An honest debate on how our health care system operates must deal with how access to care is rationed. One way is by the thickness of patients' wallets, another is by how many procedures government is willing to fund. Both methods are used and any policy debate should focus on determining an acceptable balance. Politicians of all stripes often avoid admitting that rationing takes place, and they attempt to shift the debate to other grounds such as the misunderstood Canada Health Act.

The harsh reality of rationing care was not so clear in the early days of increasing government involvement in health insurance. The first big step was taken in the 1950s when government took responsibility for paying hospitals. Initially, public hospital insurance did not involve government dictating how hospitals should function. By the early 1970s public health insurance was completed by adding payments for doctors. Both hospital insurance and medical insurance were introduced so as to fix the failures of private health insurance, including canceling coverage when people retired.

Once government became the single health insurer it started to worry about rising costs. A series of royal commissions were appointed across the country to review health care and make recommendations on how to improve service while controlling costs. It is questionable whether any of them produced significant change, but the system evolved substantially in the past 30 years. Pharmaceuticals took a greater proportion of health budgets. Combined with technological change and the aging of the population, health care in 2004 is very different from the system originally studied by Emmett Hall. Control of health care also gradually changed. Power and control of health care also gradually changed and are now centralized in the hands of government appointed health authorities who operate under strict instructions that they must not go over budget. Independent hospitals used to routinely go over budget and confront the government with a done deal. That is a thing of the past. Many believe that the increased centralization of control over the health system might lead to more rational decision making and more efficient service delivery. The question is whether it will efficiently deliver only half the amount of care that is required!

Just how will the New Era health system determine how much care to provide? Before exploring that fundamental question it is useful to consider a complication that arose in the past few years. Technological change has made it possible to have stand alone surgery centers that are an alternative to hospitals. In British Columbia the first such centres were women's health clinics that provided abortion services. More recently orthopedic and eye surgery centres have opened as well as private MRI imaging centres. In the 70s and 80s people were satisfied with their ability to get procedures from public hospitals, or at least they were sufficiently satisfied so that a market didn't exist for private clinics. Not enough people were willing to pay thousands of dollars to get their procedure performed quicker so as to make it economical to open a private clinic. In the 1990s the federal government, under then Finance Minister Paul Martin, chose to balance its budget by cutting funding to the provinces for health care. The provinces responded by restricting health budgets, and the public responded by looking for alternatives. Dissatisfied with how long it was taking to get people back to work, the Workers' Compensation Board and ICBC contracted with the emerging private surgery centres. That created a market for their services, and they haven't looked back.

There has always been a multi-tier health system in Canada. In the early days of "Medicare" no one cared because the universal system was considered to be very good. As wait lists became unsatisfactorily long, more attention has been paid to the fact that folks with money can go to the US for their surgery; the RCMP, prisoners and other special classes enter the system with preferential treatment. The private surgery centres, however, take the multi-tier system to a new height. It is now the case that you can get quicker treatment if you get hurt on the job than if you have exactly the same injury at home. It soon became common knowledge that some folks who were injured at home were taking advantage of the clinics by paying out of pocket. That appears to be a violation of the Canada Health Act.

The Canada Health Act was created in the 1980s as a mechanism for the federal government to put pressure on the provinces to stop extra billing by physicians and to stop user fees in hospitals. At that time, BC charged a daily fee for use of the hospital and extra billing by physicians was becoming a problem in Alberta and Ontario. The Act provided that if those practices continued, the federal government could withhold one dollar from its cash transfer to the province for each dollar that was charged in extra billing or user fees. Today we frequently hear the claim that something is "against the Canada Health Act". All that means is that the federal government might decide that it will withhold some money from a province in response to a practice that is contrary to the Act. Many people believe that paying out of pocket at private surgery centres could lead to financial penalties under the Act. For example, it is reported that MLA Barry Penner recently had to pay approximately $7,000 as the facility fee in order to have his ruptured disk operated on in a private surgery centre. Under the Canada Health Act the federal government could, but it doesn't have to, decide to deduct a corresponding $7,000 from its cash transfer to the province. The current level of out of pocket payments makes the entire issue equivalent to counting angels on pinheads, but if out of pocket payments to private clinics expanded, the federal government could decide to put pressure on the province to stop the practice. None of this says anything about what happens if a third party pays for the patient's "facility fee".

Since WCB and ICBC pay for their clients to use the private surgery centres, why couldn't MSP or some other part of the Ministry of Health Services pay for everyone's use of the clinic? If you were in Barry Penner's situation, why shouldn't you be able to go to the surgery centre and have it paid by simply presenting your CareCard? There is nothing in the Canada Health Act that would stop that or penalize the province for doing that. The Vancouver Coastal Health Authority is in the process of issuing requests for proposals (RFPs) for private clinics to perform procedures that are currently performed in hospital. There is an important difference between the RFP process and the scenario of being referred to a clinic by your doctor and having it paid through your CareCard. In the RFP process the Health Authority will maintain control over the number of procedures that are performed. If it contracted for 100 surgeries to be done at a private clinic, it may decrease the number done through its hospitals by the same amount. One way or the other, the Health Authority will keep its budget balanced. On the other hand, if clinics could expand to meet the demand by billing through your CareCard for everyone who walked through the door, they would expand to meet the demand and the government would lose control of its budget.

The reason many people who are in pain cannot get their surgeries quicker has nothing to do with public vs. private health care. It has nothing to do with nursing shortages. It is a simple matter of rationing the number of procedures government is willing to cover out of the health budget. Of course, if government was willing to loosen the purse strings there is a legitimate debate over whether public hospitals should be allowed to provide the service rather than private clinics, but that is a side issue relative to the fundamental debate over rationing access to care.

Some conservatives understand the rationing issue and respond by arguing that there is nothing wrong with people using private clinics and paying out of pocket. After all isn't that more convenient than going to the US? They argue that the federal government should provide certainty by either amending the Canada Health Act or by providing assurances that it won't be used to financially penalize provinces that allow people to pay for their care.

Opposition to out of pocket payments, and eventually private insurance for access to private surgery centres, comes from many quarters, from those who want to protect vested economic interests to those concerned about the consequences for public health care. Advocates of a two tier system prefer to characterize opposition as coming from those with economic interests to protect, particularly public sector health unions. They would prefer to ignore the fact that it could make it easier to cut the public system. Governments have already shown that they are willing to take enormous political heat over how they manage the health system. If people could be told "if you don't like the wait, you can use the private system", it could take some of the political heat off and make it easier to let waiting lists grow. In that case, rather than supposedly decreasing the queue by using a private clinic, those using the private clinics would be making it easier for the government to further cut funding to the public health system. That is the fundamental issue and the grounds for the debate on how our health system should be structured.

The public system can be expanded so people won't need to or want to use private clinics, or more people can pay out of pocket with the possible consequence that wait lists in the public system will be allowed to grow longer as budgets fail to keep up with the need for care. When Gordon Campbell promised to make health care available "when and where you need it", he didn't say that access would depend on the size of your wallet.