Defend Public Healthcare

As feared yesterday -- the premiers rolled. Their  media release on health care  that came out as their meeting in Niagara-on-the-Lake ended  didn't even dare to beg for better federal health care funding.  It  didn't even utter the word "federal".  Despite the hole the new federal funding policy will leave in provincial coffers, despite the protestors who told the premiers yesterday that federal funding was THE issue, restoring federal health care funding was a complete non-issue for the premiers. In another release on fiscal arrangements they did recall  that last year the  Premiers' Fiscal Arrangements Working Group   had reported  " federal health care funding would be reduced by almost $36 billion over the 10-year period from 2014/15 to 2023/24 compared to the arrangements currently in place".   But instead of demanding the cut be reversed, they  asked  only that the federal government "avoid further unilateral changes to programs&

At this week's meeting of the provincial premiers there were some sharp complaints about the federal government. But missing -- so far -- is any significant complaint about the one issue likely closest to the hearts of Canadians -- public health care.    Yet the federal government plans to kill its longstanding commitment to increase health care funding 6% per year, replacing it with as little as half of that.   As CUPE research materials indicate , that means losing an awful lot of cash for public health care -- many billions. The premiers lack of action on this comes despite a large demonstration in front of their meeting today.  The protestors demanded the premiers stand up to the Stephen Harper government on federal health care funding. All we got publicly from Ontario premier Kathleen Wynne was a thank you for helping the government focus. That's not going to get her government any more federal funding.  Not even a nickel. Tomorrow, the premiers w

Private funding of health care is increasing faster than public funding.   Now the Canadian Institute for Health Information reports that public funding is expected to fall to 69.7% of total funding in 2012. Public funding has been much higher -- in 1976 it  provided 77% of all health care funding.  After a slow, multi-year decline, it had stabilized by 1996.  But it has now fallen three years in a row. Canadian public sector health care spending is expected to increase 2.9% in 2012 while private funding is expected to increase 4.6% (more than half again as fast). Public sector expenditure is the lowest of all provinces and territories in Ontario -- at 67.8% in 2011.  Ontario also saw the second lowest increase per capita  in public sector health care expenditures in 2011, with a 1% increase. The cross-Canada increase was 1.7%. Private funding of health care increases inequality as only those with the cash (or robust private insurance) will receive the full range health care s

Federal Finance Minster Jim Flaherty has indicated that there is no promise to increase the Canada Health Transfer (CHT) to the provinces by 6% per year beyond the first two years after the ten year accord expires in 2014. The public won the promise for the two years during the election -- but that's where it ends, for now. More bad news: the  Globe and Mail  reports that newly re-elected Saskatchewan premier Brad Wall wants to  tie federal funding 'to health care "innovation," a term sometimes used to describe increased private-sector involvement.' Wall wants to create more conditions for his province to meet before it receives federal funding, it seems. Meanwhile, the federal government doesn't much bother to ensure that  the provinces meet the existing conditions for federal funding, i.e. the five principles of the Canada Health Act that guarantee universal, comprehensive, accessible, portable, and publicly administered health care.   

The new  National Health Expenditures Trends   notes that the administrative costs arising from private sector funding are now more than three times the administrative costs associated with public sector funding (p. 31): In 1975, administration accounted for 2.9% of total public-sector expenditure and 2.5% of total private-sector expenditure. The public- and private-sector trends differ over time. While the share gradually declined in the public sector to 2.0%  in 2009, the private-sector share has risen to 6.2%. The increase in private sector administrative costs appears to coincide with the increased role of private health insurance  discussed earlier .  That makes sense.  Private insurance incurs administrative costs while the other main form of private payment, 'out of pocket' payment, incurs very little. The more private insurance, the more administrative costs. Just like the USA.

This year's National Health Expenditures Trends  is out.  It expects per capita health care spending increases in 2010 and 2011 to grow at 4.7% and 2.8% respectively.  "When adjusted for inflation and for population changes, real rates of increase are expected to be 2.0% in 2010 and 0.6% in 2011." Total public sector spending is expected to increase 6.0% in 2010 and 2.99% in 2011. Private sector spending is expected to increase more rapidly, at 5.66% in 2010 and 6.25% in 2011.  That is about 3% higher than public sector increases over the two years. With modest total spending increases, total health expenditure in Canada is forecast to fall from 11.9% of the economy in 2010 to 11.6% in 2011. Private health care insurance costs have been increasing more rapidly than other forms of private payment.  Private health insurance expenditure per capita increased from $139.4 in 1988 to $648.9 in 2009.   Yesterday , group insurance companies providing private health care insu

Public private partnership "funding for new infrastructure, such as schools and hospitals, does not provide taxpayers with good value for money," according to the Treasury Select Committee of the British House of Commons. The Committee found that the capital cost of even a low risk P3 project is over 8%  – double the long-term cost of government borrowing. Higher borrowing costs since the credit crisis mean that PFI (as the British call P3s)  is now an ‘extremely inefficient’ method of financing projects, according to the Committee. Analysis commissioned by the Committee suggests that paying off a PFI debt of £1bn may cost taxpayers the same as paying off a direct government debt of £1.7bn. The Committee also stated it has "not seen any convincing evidence that savings and efficiencies during the lifetime of PFI projects offset the significantly higher cost of finance." The business publication  Health Investor   adds  that PFI schemes perform poorly in s

It's amusing to see the Harper government   begin to prepare the way   for stimulus spending should the economy dip into a second recession. After the election, the Harper government changed its focus to curtailing public spending  -- or, as they like to refer to it, “lowering the deficit”. Programs for working people would  have to be scaled back. But curtailing spending (and reducing the deficit) is, apparently, quite expendable if the economy tips downwards.  If events do go this way, I'm betting that most of the stimulus will go directly to corporations (and the well to do) via infrastructure spending, cash for struggling corporate industries, and tax cuts.   Programs aimed at working people will get short shrift from these guys: the squeeze on these programs may even get worse.   And that's a pity -- the government stimulus may be necessary to stop capitalism from choking off its own growth, but why not stimulate growth by supporting programs for working people, i

Expenditures on hospitals saw some of the smallest increases in public sector health care expenditures over the last decade, according to a 2011 report from the Canadian Health Services Research Foundation (CHSRF).   In contrast, health services from the sectors dominated by for-profit corporation (drugs and capital expenditures) saw the highest expenditure increases.  In fact the real per capita annual percentage increases for these two sectors were about double the increases for the hospital sector.  Compound annual growth rates of real per capita public sector health care expenditures, 1999 to 2009, Canada Use of funds                                                      Compound annual growth rate Total health                                                                        4.13% Hospital care                                                                      3.41% Other institutions                                                                 2.45% Physician care    

What's striking in the threats by the federal government to legislate back Air Canada and Canada Post workers is that they came so quickly.   This is something new. In Canada Post's case, the threat of legislation came only a few hours after Canada Post locked the workers out.  For its part, the union had offered to accept the existing contract and continue negotiations to keep the mail moving. Far from threatening the national economy, the Air Canada strike was (if you can believe news reports) hardly even inconveniencing passengers before the government began to threaten legislation.   Given the speed of the legislative threat, this may well have been the plan even before the strike began.   (Indeed, one has to wonder if the government telegraphed its plan to Air Canada before the strike began, further undermining the bargaining process.)  The result?   The employer may be able to ditch the defined benefit pension plan for new hires: the issue will be sent to arbitrat

Colleen Flood, the Canada Research Chair in Health Law and Policy at the University of Toronto, has commented  that the Conservative Harper government may require the provinces to increase for-profit health care delivery in exchange for new federal funding.  Here's her comment about the upcoming federal-provincial discussions on the Canada Health Transfer:  "Perhaps the one thing that is new is the emphasis on private for profit delivery which we’ve been seeing. There’s some talk that that may be a condition that the feds actually put on the transfer, the condition of experimenting with private for profit delivery within the context of a public system. I don’t think that’s ever been actually discussed much." The current Canada Health Transfer agreement with the provinces expires in March 2014.  

Among the claims made by the critics of socialized health care in Canada, one often repeated suggestion is that Canada is an out-lier (a socialist throwback , even) and that many highly developed European countries have a more privatized health care system. Well of course, the range of services covered by the public system varies from country to country, with one providing this range of services, another providing that.  But the most comprehensive single comparison is the percentage of health care costs covered by the public system. And those figures make clear that Canada has some catching up to do if it is going to match the public coverage provided by other developed countries. The 2010 study National Healthcare Expenditure Trends from the Canadian Institute for Health Information (CIHI)  reports (p. 65) that the share of health care costs in Canada covered by the public system is behind almost all European countries.  Only the Switzerland and  the Slovak Republic lag behi

Andre Picard’s piece in the Globe today suggests that the Tories will keep the 6% Canada Health Transfer funding escalator intact only until 2016  -- that's the most minimal version of the promise they made during the election campaign.   Picard, however, suggests the Tories will avoid a ten province deal and instead create different deals with different provinces, with increases only keeping up with inflation after 2016.  The deals would tie the money to specific items in different provinces (e.g. wait times for certain surgeries in Ontario, catastrophic drug coverage in New Brunswick.)   There is also even the suggestion that ultimately the Tories may get rid of all federal- provincial  transfers and instead give the provinces revenue from the GST.    The CHT cash transfer currently supplies about $27 billion to the provinces for health care.  For Ontario that covers about 23% of provincial health care spending ($10.746 billion).  Such changes would radically reduce the federal

Premier McGuinty has called for a ten year deal on federal health care funding. Right now, the federal government provides more than $10 billion through the Canada Health Transfer (CHT) for public health care in Ontario.  That is a lot of cash, almost a quarter of total provincial government health care spending. Under the existing ten year agreement with the provinces, originally negotiated in 2004, federal government increases added over $800 million in new health care funding for the province of Ontario this year alone.  But the accord runs out in 2014 and the Harper Conservatives  failed to make any solid commitment to continue to increase the CHT prior to the election call.  In fact., they did not even mention the CHT in their party program. The end of the current CHT "escalator" would be a devastating blow to public health care. Thankfully, the election campaign has forced the Conservatives to change this line and promise to increase federal health care fu