Be careful, Canada
Be careful what you wish for, Canada.
One way or the other, Canadian courts are about to take some key decisions about the role of private financing and practice in your healthcare system; the on-going Cambie trial in British Columbia is just the latest attempt to overturn fundamental components of publicly funded medicare.
The decision of this trial will have ramifications for decades and for millions of people. So, what can international experience teach us?
One particularly illuminating case is Ireland. In 1957, the Irish Republic decided to set up a voluntary health insurer owned by the state to take the pressure off the public system, allowing those who had the means to buy healthcare.
It sounded reasonable. But sixty years later, private health insurance has taken off with almost half the population covered. This allows faster access to public care subsidized by the state and queue jumping of the very long waiting lists by the better off.
Despite only accounting for 12 per cent of total health funds, private insurance in Ireland now drives access to hospital care — the tail that wags the dog.
Private health insurance occupies a unique role in the Irish setting providing faster access to care in both public and private provider settings. However, it does not always cover hospital expenses and often covers a fraction or no cover for non-hospital care such as outpatient appointments with a specialist, GP visits or care from allied health professionals.
Private health insurance in Ireland does not cover drugs costs, perhaps because there is already a government reimbursement threshold for households spending more than a fixed amount in a month. Moreover, the benefits of queue jumping only accrue to those who are able to afford private health insurance premiums — and there are also concerns about the affordability of private health insurance.
Ireland has historically been way off the pace when it comes to delivering universal healthcare and it is therefore an outlier in Europe and has one of the highest proportions of national income spent on voluntary health insurers. The result is two tier access to acute care and only very average results in terms of health outcomes. (The other two countries with large voluntary health insurance sectors are France and Slovenia but their insurers cover co-payments and they do not allow faster access).
Rather than helping the public sector out, private insurance may have contributed to the problems. It erodes solidarity giving the well-off a way out of engaging with the public sector and potentially aggravating underfunding by making the better off less happy to be taxed more for health.
It also means that dual practice providers — those who work in both the public and private sectors — have an incentive to keep their public waiting lists long to boost their private practice. Private insurance also costs in terms of public subsidies and the need for regulation.
As a potential way out, the Fine Gael Labour government of 2011 proposed Irish private insurers to be the basis of a Universal Health Insurance, modelled on the Dutch managed competition system. However, this policy cul-de-sac proved too expensive and too complex. It has now been abandoned for a more typical re-energizing of the public system in the guise of the “Sláintecare” policy.
The core aims of Sláintecare are to establish a universal, single-tier health service where patients are treated solely on the basis of health need and funded through general taxation. This means a removal of private insurance funding from public hospitals (over six years) with waiting time guarantees backed up by increased accountability and information.
Nevertheless, the disentangling of the public and private systems is not an easy task; it will take careful planning, sequencing, coalition building and changing the public narrative about the nature of the health system. These are worthwhile challenges to take on in order to deliver a true, universal healthcare system for Ireland.
The introduction of private health insurance in Ireland allowed a two-tier system to develop with long waiting lists in the public system and limited financial protection for households. It is striking that as Ireland is struggling to limit the role for two-tier healthcare, Canada seems on the cusp of embracing it.
While Canada might be considering an expanded role for private health insurance, such a decision needs to be taken with sober judgement. It cannot be easily unwound. Private health insurance was initially introduced in Ireland to take some of the pressure off the government. However, its introduction has impeded a fair, efficient and integrated system and there has been substantial profiteering by smaller insurers since the liberalization.
It has taken 60 years to develop a plan that will disentangle public and private financing in Ireland. Implementation will take another 10 years at least. It must be questioned whether Canada can afford such a lengthy and difficult journey.