To end hallway medicine, we should consider a public-private model

Posted on April 1, 2019 in Health Policy Context

Source: — Authors: – Opinion

Ake Blomqvist is health-policy scholar at the C. D. Howe Institute and an adjunct research professor at Carleton University.

The promise to end “hallway medicine” was an important element in the campaign of Ontario Premier Doug Ford and the Progressive Conservatives in 2018. If they are serious about reaching that goal, the government should change the rules that currently make it almost impossible for privately funded medicine to compete with the Ontario Health Insurance Plan (OHIP), even though any move in that direction will provoke cries about the threat of “two-tier medicine.”

The government’s plans for a superagency to replace the Local Health Integration Networks (LHINs) and a network of Ontario Health Teams responsible for co-ordinating patient care using digital technology are consistent with the recommendations of Rueben Devlin, the chair of the Premier’s Council on Improving Healthcare and Ending Hallway Medicine. In interviews, he called for “a little bit of organizational change” to create “a Ministry of Health and an organizational structure that is nimble and effective.”

The government will need a lot of good luck for these kinds of administrative tweaks to end hallway medicine. The history of provincial health policy in Canada is replete with examples of reform proposals that have had little or no effect on costs or system performance. While Ontario has implemented new methods of paying primary-care physicians over the past 15 years, they have not yet had a major impact on either. Health-care management in Canada has been very resistant to change, to the point that, in recent international comparisons, the only country whose system is consistently ranked lower is the United States.

One reason for this may be the Canadian model of divided federal-provincial jurisdiction over health policy; politicians at both levels tend to spend more energy blaming the other guys rather than attacking the problems head-on. But another reason is the Canadian obsession with not allowing any meaningful competition between the provincial plans and privately funded health care. Even though all industrialized countries other than the U.S. have universal health insurance, the other countries allow more public-private competition than Canada does, either because people are allowed to choose between public and private insurance plans (like in Switzerland, the Netherlands and Australia) or because doctors are allowed to treat both public and private patients (as in the U.K.).

In a system where all health care must be supplied through a single government plan, innovation is a lot harder to bring about than in a model with more choice, for patients and providers, with respect to the way care is supplied and paid for. Under a government monopoly, any proposal for reform becomes highly political and gets bogged down in long, complicated negotiations between government and stakeholder interests. In a pluralistic model with public-private competition, providers and insurance plans have more freedom to experiment, because patients or doctors who don’t like what is being tried have alternatives. The result may well be more innovation and, in the long run, a more efficient system.

Dr. Devlin has spoken favourably about the “possibilities of virtual care” and cited U.S. health maintenance organizations (HMO) as examples of insurers that have made good use of digital technology in setting up their clients’ care. A proposal to convert OHIP into a U.S.-style HMO would obviously be dead on arrival, but allowing Ontarians to choose a private plan as an alternative to OHIP might not. If Dr. Devlin, Mr. Ford and Health Minister Christine Elliott want to go down in history as having set Ontario’s health policy on a new path, they should consider introducing more freedom for privately funded medicine and insurance to compete with the public system.

Defenders of the current model will object vociferously, citing the danger of allowing scope for two-tiered medicine. Reasonable people recognize, however, that preventing wealthy people from getting health care they are willing to pay for out-of-pocket is just a means to an end: To ensure that everyone, rich and poor, can access good health care when they need it.

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