Terence Corcoran: Can central planning save health care?

·5 min read
COVID Ont 20200629
COVID Ont 20200629

It didn’t take long for Sylvia Jones, Ontario’s health minister, to try to calm the ruffled feathers of the province’s fluttering medical pigeons following her refusal on Wednesday to rule out privatization of health-care delivery. ”All options are on the table,” she had said. Oops. On Thursday, in response to questions in the legislature, Jones took one of the options off the table.  Free access to health care via government-supplied health cards “is never going to change,” she said.

Like all Canadians, residents of Ontario and their insurers pay for some medical services, but the real cost of health care is essentially government-funded and government supplied.  Nationally, last year governments spent $300 billion (more than $32,000 per family of four) on health care, with annual spending increasing unsustainably faster than the national economic growth rate.

By ruling out the prospect of greater fee-for-service health care, Jones is attempting to ward off the ideology-fed local and national political panic over the possibility that health care could be “privatized” and turned over to bands of immoral, profit-seeking corporations.

A typical bit of hysteria from The Council of Canadians warned that Ontario Premier Doug Ford “has used the pandemic as an opportunity to cut and privatize health care, to line the pockets of his corporate friends.”  Added the council: “Privatizing health care has always been the plan.”

If only that were true. What seems to be shaping up in Ontario and around the country is pressure for escalating government spending on health care based on the only model that’s available when the government is in control: central planning. Amid the panic, there is no shortage of five-point and 10-point plans that call on governments to do more, spend more, plan more, collect more data — and pay more.

Actually, that’s one of the few areas in which the benefits of dollar-driven market forces are recognized in the health-care field. If we want more nurses and emergency staff and PSWs, let the price system bring in the needed workers. The Ontario Council of Hospital Unions last week issued a  “five-point plan” to staff up the provincial hospital system.  Among the five points: increase wages to attract and retain staff; offer financial incentives to discourage retirements and enhance hiring and retention; and recruit with incentives for the thousands of nurses, paramedical and others who are licensed and not working.

Over at the Ontario Medical Association, representing doctors, the central planning machine produced a “Doctors’ Five-Point Plan for Better Health Care”: 1) Reduce wait times and the backlog of services. 2) Expand mental health and addiction services in the community. 3) Improve home care and other community care. 4) Strengthen public health and pandemic preparedness. 5) Give every patient a team of health-care providers and link them digitally.

Each of the plan items require another half-dozen or more planning targets. For example, the plan for item one on the five-point planning list includes eight other planning sub-objectives, such as “providing adequate funding” and “evolving the model of surgical care delivery” to include outside-hospital settings. All told, the OMA five-point plan contains about 80 proposals for government action.

Another source of planning advice was published last May in The Globe and Mail under the headline “10 ways to fix Canada’s health-care system right now.” Written by four experienced and distinguished health-care managers and policy veterans, their approach begins with a statement that they “strongly disagree” with proponents of for-profit hospital and physician care. Instead of market forces, they prefer central planning methods. “We will present solutions to each of these (10) problems that can be implemented by sheer force of political will, and in many cases without major investment.”

With sheer force of political will, the government should make pharmacare a reality, introduce dedicated community surgery centres to reduce wait times, bring in digital referrals by mandating certain electronic record systems, among other things.

Some journalists have their own central planning models. Andrew Coyne, for example, says it is wrong to think that nobody knows what to do about the health-care system. “That’s not the case. The broad strokes of reform have been widely understood for decades. Emphasize prevention over care. Move doctors, to this end, from fee-for-service to a flat per-patient payment (called capitation), and from sole practitionerships to multidisciplinary teams of providers. Require every patient to enrol with one of these teams, who are responsible to either treat them for whatever ails them or refer them to hospitals for surgery. They might even pay the hospitals out of their budgets, becoming the purchasers of care on their patients’ behalf.”

That’ll be easy.

And then, of course, there is the data problem. One of the classic critiques of central planning is that there is no way to accumulate all the knowledge necessary to make the right decisions without a market and price system. Without a price system, there is no real way to allocate resources. Not surprisingly, then, the Canadian Medical Association recently called for the creation of a national health-care data collection system. CMA President Katharine Smart said Canada is “at the end of many years of poor planning and lack of planning.”

We need more data, said Smart. “We are facing a crisis. It’s important that we plan correctly, having robust data that will support provinces and territories.” It was a classic plea of the central planner.

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