Sustainability

What’s the Issue?

Sustainability is a loaded word. It often turns up when people are discussing what might be wrong with the Canadian healthcare system. In general terms, “sustainability” describes the ability to maintain something at a certain level through conservation or defence. In Canada’s healthcare debate, “sustainability” can trigger a heated argument about whether we can afford the level of healthcare people expect at a cost which is acceptable to Canadians and their government(s). But is Canada’s healthcare really at risk of becoming unsustainable?

These discussions are complicated because we usually aren’t told what is causing the concern: which costs are rising (e.g. public or private), what is being compared (e.g. absolute cost increases or cost increases as a percent of gross national product) and how health costs relate to other financial developments (e.g. is the economy growing or shrinking).

There is also confusion about what proportion of government spending is taken up by healthcare. This is affected not only by how much the government spends on healthcare, but also by how much it spends (or doesn’t) in other areas. For instance, if the government decides to cut back spending on education or police services, then healthcare spending—even if it remains unchanged—will account for a larger percentage of the provincial budget.

So instead of worrying about the unsustainability of healthcare, Canadians should be asking how the numbers are moving relative to other factors such as: private health spending, gross domestic product, government spending in other areas, and tax revenues. That’s the way to sustain an informed discussion on sustainability.

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Evidence

In their December 2012 report Strengthening Primary Health Care through Primary Care and Public Health Collaboration, Dr. Ruta Valaitis (McMaster) and her teams in Ontario, Nova Scotia and British Columbia explored how public health and primary care can improve health and the quality and effectiveness of primary health care systems in Canada when they work more collaboratively.
Healthcare spending as a % of Gross Domestic Product (GDP) has increased gradually over the last several decades, showing sharp increases in the recent past and in the early 90’s – reflecting the impact of a recession. Healthcare spending typically goes up as a % of overall spending during recessionary times.

Public healthcare spending has risen in absolute terms since 1998, although the Canadian growth rate in per capita health expenditures has been lower than the OECD average. Healthcare spending is also taking a greater share of total government spending in recent years. Tax cuts at both the provincial and federal levels have reduced provincial revenues and contributed to pressures on provincial budgets.

Canada’s healthcare costs are at the higher end of other wealthy countries (although much lower than those of the United States).

Aging of the population is often described as tsunami about to swamp our Medicare system. However, various studies for many years have shown that aging of the population per se will add less than 1% a year to healthcare costs. Although the population is aging and the babyboomers are expected to live longer than their predecessors, the increased number of elderly will be small in comparison to Canada’s overall population and consequently their impact on the delivery of healthcare in Canada will also be small.

Aging of the population typically accounts for only a small fraction of inflation-adjusted health cost increases. Health cost increases are driven by changes in the quantity and types of healthcare received by Canadians of all ages, not by demographic changes. That is, an aging population provides opportunities for all sorts of interventions without good evidence of increased health or quality of life, but this is an issue for all Canadians, not just the elderly. An aging population does not necessarily threaten the sustainability of Canada’s healthcare system, but it does create a need to ensure we are able to provide seniors with the right care, in the right place, at the right time.

Polls tell us that Canadians’ big concern with the healthcare system is wait times and access to care. While sometimes more resources reduce wait times, evidence suggests there are several issues contributing to wait times and several approaches to solving them. Accurately recording waits is an important first step. Appropriateness of care (is this MRI necessary?) is another issue. Many waits and delays are not due to a lack of resources but rather a failure to use appropriate management tools. Work that has been done changing management practices in Alberta and Ontario has rapidly reduced wait times without increased resources.

Separating issues of funding (i.e., who pays for healthcare)and delivery (i.e., who owns and administers the institutions providing care) helps to inform debates about public and private roles in healthcare systems. In Canada, about 70% of healthcare funding comes from public sources – this is slightly below the OECD average. However, almost all services delivered in hospitals or by physicians are publicly financed.

The delivery of care can also be by public and private operators. Private operators can be divided into: corporate for-profit (operators are responsible for maximizing return to their shareholders), for-profit small business (which includes physicians and physiotherapists who deliver care through private offices/clinics), and not-for-profit organizations such as Canadian hospitals.

The evidence suggests that under most circumstances corporate for-profit delivery of healthcare produces few benefits to the patient or to the healthcare system. Potential ‘win-win’ situations exist if savings result from strong economies of scale or better management. However, savings frequently arise from more contentious measures, including freedom from labour agreements (and different wage levels and skill mixes), evasion of cost controls placed on other providers, sacrifice of difficult-to-measure intangibles, risk selection/cream skimming, or even dubious practices. In theory, these problems can be minimized if performance is monitored, but this adds additional costs, and may be difficult where outcomes are not easy to measure. If performance cannot easily be monitored, not for profit delivery is more likely to provide high quality outcomes than is for profit delivery, with corporate for profit delivery being the most vulnerable to poor outcomes.

Making patients pay isn’t the key to making the system more affordable. User charges for patients discourage patients from seeking both necessary and unnecessary care. When preventive care is discouraged and effective drug prescriptions are not filled, user charges can promote higher costs and poorer health. Medical savings accounts, another approach to making the patient pay, don’t work. They don’t work for services that the sick need and they don’t work for the services that the healthy need.

More Healthcare and More Expensive Healthcare is not Always Better. It is easy to assume that the real problem with the healthcare system is “not enough” – not enough physicians, not enough MRIs, not enough money in the system. But the evidence suggests more healthcare is not always better, the more expensive drug is not necessarily the right choice. In fact, the evidence suggests that sometimes more care, care that you don’t need, can be harmful and expose patients to unnecessary risks.

How Important is Healthcare to Health? Health starts in our homes, schools and communities. It is critical that everyone can see a doctor when they are sick and everyone needs to be able to access preventive care easily – things like screening for cancer and heart disease. But we also need to stop thinking of health as something we get at the doctor’s office. Health starts in our families, in our schools and workplaces, in our playgrounds and parks, and in the air we breathe and the water we drink. The evidence shows the conditions in which we live and work have a big impact on our health, long before we see a doctor.

Researchers in the US estimate that over the period 1996 through 2002 medical advances saved a maximum of 178,193 lives. They also estimated how many lives would have been saved if mortality rates among US adults with an inadequate education had been the same as rates among adults with 1 or more years of college. Changing US society to eliminate deaths associated with disparities in education would have saved 1,369,335 lives during the same period, a ratio of 8 to 1.

The Canadian Health Services Research Foundation 2007 Mythbuster focused on the “Myth: Canada’s system of healthcare financing is unsustainable.”

Synopsis: For the average Canadian, the debate over financial sustainability is not so much a question of whether the system is affordable, as it is “Will Medicare be there for me when I need it?” The answer hinges on a simple fact: “Medicare is as sustainable as Canadians want it to be.”

For an update on how other countries are dealing with health policy issues see: The International Health News Briefing summarizes health policy news from selected countries. It is produced by The Commonwealth Fund’s International Program in Health Policy and Innovation. Visit the International Health Policy Center for more on the program’s activities.

Recommended reading on Sustainability from the Health Council of Canada

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