HILL: Smith government must stand up to Ottawa to fix health care

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According to a recent report commissioned by the Smith government, there are several ways the province can improve Alberta’s health-care system. But for fundamental change, Alberta must stand up to Ottawa.

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Alberta is a relatively high spender — and poor performer — in a relatively high spending and poor performing health-care country. The province ranked second-highest on health-care spending per person (adjusted for age and sex) among provinces in 2021, the latest year of available data. Yet at the same time, Albertans endured health-care wait times longer than the national average. And again, Canada itself is a relatively high spender among universal health-care countries yet ranks near the bottom for the availability of medical technologies, hospital beds and doctors.

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The report, which focuses primarily on future public emergencies, suggests moving towards “activity-based funding” for hospitals rather than set budgets each year. By funding hospitals based on activity — that is, the care and treatment provided — money would follow the patient, creating a clear incentive for hospitals to treat more patients rather than treating them as costs to be minimized. Several successful universal health-care countries that outperform Canada on key measures, including wait times, use this funding model.

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The report also recommends maximizing the use of private facilities. For evidence of success, Albertans can look to Saskatchewan, which used private clinics (and other initiatives) to reduce wait times in that province from 26.5 weeks in 2010 to 14.2 weeks by 2014. These private clinics also delivered surgeries at a cost 26% lower (on average) than their public-sector equivalents. Other provinces, including Quebec, have found success in contracting with private clinics to reduce wait times.

Again, these changes could make a big difference, but the report did not consider other important policies — e.g. cost-sharing — that exist in most universal health-care countries.

Indeed, unlike Canada, most universal health-care countries expect patients to share the cost of health-care services, with protections and exemptions for vulnerable populations. This includes countries such as Australia, France, the Netherlands and Switzerland, which all have shorter wait times for specialist consultations and surgeries than Canada.

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According to empirical evidence, cost-sharing can help reduce the use of outpatient (ambulatory) care — which would help reduce wait times — without adversely affecting the health of the population. In other words, cost-sharing could help encourage a better, more efficient use of existing health resources by helping prioritize the demands on our health-care system.

While the idea of sharing the cost of services may seem daunting to some, remember this — Albertans already pay for their health-care system with their tax dollars. If the government restrains health-care spending, cost-sharing may simply shift the point of payment from more tax dollars to direct payment — all while improving efficiency in our health-care system.

However, the Canada Health Act expressly prohibits cost-sharing, and if Alberta experiments with it, the federal government may reduce federal health-care transfers (i.e. money) to Alberta. That’s a big deterrent for any province to experiment with such policies, despite any potential benefits.

The report includes some important reforms to improve access and care for Albertans, but to have the greatest impact, the Smith government must work with Ottawa to experiment with big policies.

Tegan Hill is associate director of Alberta policy at the Fraser Institute.

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