August
26, 2004
Private
Clinics and Public Dollars
On
Tuesday, August 24th, Global TV continued with coverage
on the Campbell government's use of private surgery centres.
Their story included an interview with medical ethicist
Professor Eike-Henner W. Kluge from the University of Victoria
who said that of over 149 studies, 131 show that publicly
funded institutions are more efficient and cheaper than
private institutions.
Professor
Kluge provided me with the following citations to support
what he said on Global.
Vaillancourt
Rosenau P and Linder SH. 2003 "Two decades of research
comparing for-profit and nonprofit health provider performance
in the United States." Social Science Quarterly;
84(2):219-241, http://www.blackwell-synergy.com/links/doi/10.1111/1540-6237.8402001/abs/;
Vaillancourt
Rosenau P and Linder SH. 2003. "A comparison of the
performance of for-profit and nonprofit U.S. psychiatric
inpatient care providers since 1980," Psychiatric
Services; 54(2): 183-187, http://intl-psychservices.psychiatryonline.org/cgi/content/full/54/2/183;
Silverman et al. 1999. "The association between for-profit
hospital ownership and increased Medicare spending."
New England Journal of Medicine; 341(6): 1523-1528,
http://content.nejm.org/cgi/content/abstract/341/6/420.
I also
discovered the following article.
Woolhandler
Steffie and Himmelstein David J. 2004 "The high costs
of for-profit care" Can. Med. Assoc. J., Jun
2004; 170: 1814 - 1815, http://www.cmaj.ca/cgi/content/full/170/12/1814.
See the excellent references at the end of that article,
complete with links when the references are available online.
The
research cited here supports a simple point; if government
has a choice between allocating dollars to private surgery
centres or to public facilities, it should decide on the
facility that is most effective and efficient. The evidence
suggests that public facilities have the advantage. Instead
of siphoning off scarce dollars to private surgery centres,
government could re-open closed beds and operating rooms
in public hospitals. It could also look at establishing
new types of specialized public facilities that specialize
in particular procedures.
August
25, 2004
Private
Clinics and Wait Lists
On
August 23rd Global TV broke the story that the government
is using private clinics, and it is claiming that the contracting
out is necessary because of the growth in wait lists that
followed HEU job action. Premier Campbell and Health Minister
Hansen are playing politics with patients on the waiting lists;
they've moved just far enough to create a debate, but not
far enough so that the market can expand and eliminate the
waiting lists.
Someone
who is in pain or disabled is not likely to have the patience
to argue over the subtleties of health economics. It is understandable
that they want their procedure and they want it now; they
want Campbell to keep his promise to make health care available
when and where people need it. From that point of view, no
one is going to object to the use of private surgery centres
to shorten waiting lists, but was it the best way to shorten
them?
The story
on contracting surgeries to private clinics is well timed
with respect to the September 13th first ministers' meeting
on health care. Federal Health Minister Ujjal Dosanjh started
his term saying that his government would "stem the growth"
of private clinics. In subsequent interviews he backed down
and admitted that there are no plans for the federal government
to do anything about private clinics. That is why it is a
waste of time for NDP leader Carole James to ask what the
federal position is on the use of the private clinics. Dosanjh
has already indicated that he won't use the Canada Health
Act to punish provinces that contract with private clinics.
We don't
get the best decisions when we aren't offered alternatives.
The Minister of Health is not saying whether, if given the
funds, public hospitals could have performed the procedures
he allowed to be contracted to private clinics. Claims have
been made that money was saved by the contracting out, but
was that because the clinics decided to set a precedent and
offer a loss leader, or was it because the public facilities
weren't allowed to bid on a level playing field. Were the
operating rooms in public hospitals functioning at capacity
so that an escape valve was necessary, or was a political
decision made to force a debate on the role of private clinics?
Hospitals
perform hundreds of procedures, and it is impossible to allocate
costs precisely. Should the cost of security, fixing the roof,
cleaning the hallways and paying the light bill be allocated
equally across all procedures, in proportion to the costs
that can be accurately attributed to each procedure or on
the basis of some idea of what has to be done and what is
extra or marginal? There is no right answer, which is one
reason why there is some room to maneuver on pricing. It is
unfair to say that hospitals don't know the cost of any procedure,
when the truth is that there is no precise answer because
arbitrary decisions have to be made on allocating overhead.
If
the Campbell government is prepared to contract with private
clinics, why can't anyone on the wait list go to any private
clinic and have the bill paid by simply presenting their CareCard?
The clinics have been taking WCB and ICBC patients for almost
a decade. Why should there be any limits on the number of
MSP patients they take? Government continues to ration the
number of procedures that can be performed. It is doubtful
whether the clinics could have survived without the work they
received from WCB and ICBC. Government's lastest contracts
with the clinics help them grow, and they make it possible
for private paying patients with fat wallets to pay to go
to the front of the line. That doesn't shorten the queue,
it just takes off the pressure to improve the public system.
Doctors,
dentists, pharmacies and most laboratories have been private
components in a predominately publicly financed health care
system for over 35 years. The issue is not whether there
should be some private element in our publicly financed system;
it is whether government should shift work from public hospitals
to private clinics, and if so, what criteria should be used
for making those decisions. Hansen needs to say whether
he turned to the private clinics because there was no alternative,
whether he did so because they were cheaper, or whether he
has started a process of shifting where care is provided at
the same time he continues to ration how much care is offered.
How many procedures have been contracted, and who determines
who gets a procedure paid for publicly at a private clinic?
A week before the Global TV story, Hansen announced $5 million
more for heart surgeries. Why didn't he further shorten the
list by announcing $7 million, and why didn't he make his
announcement six months or maybe a year ago? The answer is
because government rations access to health care whether it
is provided in a public hospital or in a private clinic.
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