Preamble
The recent Supreme Court of Canada decision1 places a difficult challenge before the Canadian Healthcare system. The Court upheld the contention that when government imposes delays in access to treatment in order to sustain the Public Health System it violates the individual’s right to life, liberty and the security of the person. Although rationing of resources was the primary concern, this decision threatens to provoke a series of challenges which will seriously weaken the political and economic viability of the single payor system. The Canadian Government’s response to this challenge will critically affect its ability to preserve the goals and principles incorporated in the Canada Health Act.
Proposed changes
To accomplish a sustainable reform it is necessary to make two simultaneous adjustments to the system. These changes are intended to increase the system's flexibility in dealing with change and to improve its economic performance. The primary objective is to introduce an element of productive competition while preserving the systems overall structure.
I) Supplement the Regional Health Authorities with physician owned partnerships
Legislation should be written to establish physician owned partnerships empowered with the same responsibilities as the Regional Health Authorities. These partnerships should be owned equally by the physician members and should exclude ownership by non-physicians. They should be required to hire professional business management and to include in their governing body representation from the communities they serve. They should be directly responsible to the Ministry of Health. These partnerships thereby would create de facto competition within the Canadian health-care system without deviating from the intent of the Canada Health Act.
II) Establish Individual Tax-Preserved Health Care Access
Currently the Federal and Provincial governments set aside a portion of tax revenue to provide health care to all Canadians. Economic decisions which affect the availability of healthcare are therefore the prerogative and responsibility of government. It is this intrusion of government into the needs of the physician-patient relationship which lies at the heart of the Supreme Court decision. Effective revitalization of the Canadian System must begin with its funding mechanism. The tradition of governments amassing funds for healthcare should be questioned. Healthcare is an intensely personal endeavor. Individuals deserve not just access to care but the right of choice. Differences between Regional Health Authorities and fiscally responsible physician-partnerships will provide an appropriate framework. To fund this choice requires a fundamental change in the use of taxation. Rather than allow government to confiscate the necessary funds, permit citizens to preserve a portion of their tax liability specifically to purchase healthcare. Each citizen would then have the right to designate either a regional health council or a physician-partnership as their comprehensive source of healthcare. A monthly check-off out of their tax liability would distribute funds to the appropriate recipient. The commitment to universal care remains intact. The Physician-partnerships would assume the responsibility to appropriately manage their patients’ pooled fiscal resources. The quality of their fiscal decisions to deploy these funds will be a critical factor as they compete for the continued loyalty of their patients.
III) Consequences of this reform
These physician-partnerships would assume the role of risk assuming insurers. They would have the responsibility to contract with hospitals, independent providers, and to pay their employees and expenses. There would thus be two parallel sources of health care. Patients could choose either to cede their tax credit to a government sponsored regional health authority whose funding then comes directly from the government, or to use the tax check-off to purchase medical care from a physician-partnership. The outcome of the competition between these two sources of health care would hinge upon the quality of care they provide. To eliminate extraneous drains upon the healthcare dollar there should continue to be a prohibition on the introduction of private health care insurance companies. Patients would choose between government sponsored and physician sponsored care based upon their satisfaction with access to care, the outcome of care and the availability of new resources and treatment.
Within the physician-partnership, fee-for-service would be replaced by an appropriate salary determined by the partnership. Increased income then becomes dependent upon the overall performance of the group and upon incentives based rewards established within the physician’s own area of expertise. Such a system of remuneration will take advantage of the physician’s natural inclination to weigh the value of his personal services against a professional desire to treat and cure patients. To succeed, providers must focus upon efficient, appropriate care. In this new fiscal model economic incentives become appropriately balanced between provider and patient needs.
IV) Promote competition
By encouraging the formation of multiple physician-partnerships one of the major goals of Canadian reform is achieved. Open competition between care giving entities will drive an efficient reorganization of medicine. Physician-partnerships will need to negotiate arrangements with hospitals for beds, with universities for advanced care for seriously ill patients and with private provider groups for specific aspects of care. They must decide how many hospital beds they need, where they want to send their difficult cases (e.g. rare malignancies) for treatment, and whether to engage specialty providers (e.g. cardiac surgery) to perform specific tasks. The breadth of decisions they will need to make will be determined by the Government’s definition of health care that will be encompassed under tax preserved health care funding.
1 Chaoulli v. Quebec (Attorney General), 1 SCR 791, 2005 SCC 35.
End of Part I
Canada Health Act: Proposed Reorganization:
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