Major themes in Canadian public and private healthcare systems

Canada HealthCare

There has long been a debate on public vs. private health care in Canada though sometimes it is seen as not to the level of its importance. Canada has privately delivered health care and privately funded health care and the most prevalent one is privately health care. They usually operate on profit basis such as radiology centre, local non-hospital lab. Many of the rendered services tend to be publicly funded, for example, covered by Medicare; however the non-essential services are not. This is contrary to the public health care which is run by government. Their services are publicly delivered not for making profit.

The need for privatization of the health care has been of great interest for the future Canadian Health Care system. Nevertheless, a significant component of private care under current system has already existed, such as dental services, cosmetic surgeries, drug and many others. In 2006, according to Health Care in Canada, approximately $142 billion, or $4,411 per person was spent on health care. On taking inflation into consideration, it amounted to nearly three times the spending of 1975. Out of this, only $98.8 billion was the spending of governments that delivers public health care. Another $43.2 billion became spent privately for additional services (Robert Steinbrook, M.D., 2006).

The often publicly funded system tend to experience long wait times by the patients that extend to even the essential required services such as hip or knee replacements, emergency room visit and to some occasions may go to as far as radiation treatment for cancer. This explains the reasons as to why there are thriving private surgery clinics. Some as well are to the idea that more should be privately run and privately funded in order to ease the backlog that is experienced within the public system. Whereas those who oppose the move see privatization as a tool that due to the reasons that physicians have to choose between the private and public system, in case of more opening of privately funded centers, it will result to an exodus of health care workers, physicians as well as philanthropic funding out of the public system that would otherwise erode the public systems further, (Canadian Institute for Health Information, 2007).

The problem that is experienced with wait times may be done away with by increasing supply. When the provision in terms of treatment is sufficiently high, then no queue will be there. Like nations which have not experienced the problems of wait times, Germany, Belgium, France, have been paying their providers on the basis of treatment volumes as well as avoiding tight restriction on spending, ( Harrison A, Appleby J.,2005). On the other hand, to keep supply in line with demand might prove to be costly, more particularly due to the fact that an increased supply is able to stimulate further demand; when there is abundant in supply, then there is likelihood of physicians referring patients who previously would have not met treatment criteria. Because of this reasons there are more cost effective supply-side approaches:

Increasing activity directly

Paying for increased activities directly forms the most basic supply-side strategy. Its early efforts include funding for extra activity temporarily; assuming that reducing wait times was just a matter of working down the backlog. However, this short-term injections of funding encourages unsustainable strategies do not address the root causes of the wait list, as well as the backlog reappearing promptly after the money is not anymore. The most current approach of fee-for-service payment tend to stress long-term funding for activity, for example activity-based payment to hospitals, fee for service payment to physicians, or bonuses for attaining extra volume on retaining a base volume. For making sure that the new activity really brings down the wait list, policy makers can be involved in financial reward contingent on wait-time reduction and activity levels. Such combination has been successfully applied in Spain, England, Netherlands among others. The case study of the impact of activity-based funding has been clearly shown by the Netherlands.

As part of the Netherlands' cost-containment strategy, they replaced fee-for-service payment with lump-sum budgeting, as well as wait lists ballooned. Again in the year 1998-2000, there was a strenuous effort for reducing waits by enhancing reporting of wait-related data and resource offering to local wait-reduction projects. Though these efforts had success, like wait time for some procedures went down somehow, but there was no difference to the overall wait lists. A move in 2001 by the government tried to reinstate activity-based funding, giving bonuses to hospitals that managed to clear their wait lists. The initiative needed sharp increase in spending of the healthcare in 2001-2003, leveling in 2004. During this time, wait times and lists went down significantly, and from that time they have not been major changes. For that reason, paying for activity, majorly the one that is combined with paying for wait reduction forms a strategy that has been proved that manages wait times, (Willcox S, Seddon M, Dunn S. et al., 2007). Whatever can be of impediment is not having spare capacity that accommodates more activity. Therefore it is of importance to improve and increase capacity on the manner of its use.

Increasing capacity

When capacity is increased in the public system, comparison of cross-national indicate a consistent connection between capacity, such as overall spending, physicians or acute-care beds, and shorter wait times. Having a proactive targeted investment within public sector capacity tend to be an effective long-term strategy of controlling wait times. For example, England and Denmark looked forward to a rise in terms of demand for coronary revascularization in 1990s; however, Denmark was the only one that made a major investment in staff, equipment and Ors. Before long, the procedure rate of Denmark had outstripped the one of England and wait time started to go down while for England went up.

Obtaining capacity from the private sector

This is another short-term strategy. Even if private sector incorporate technically nonprofit sector, most of the literature within this area compares public with private delivery. Though there has never been any research showing major contribution on wait reduction, it still a short-term strategy that if undertaken correctly then its impact can be felt on the wait time. In some instances where private sectors have been involved, it has happen to fill some of the pressing need, to some extend have reduced waits. Here, the private provider tend to be a small business that is to set up a stand-alone clinic that is to offer a throughout service, especially in order to risk patients. These centers are able to facilitate the precise targeting and efficient use of resources. Although, it is not a requirement for-profit ownership, a section of the clinics tend to be owned by nonprofit organizations or publicly, ( Deber R., 2002). Little evidence shows that there is more efficiency in terms of service delivery, the private opt to type of services that could be run more efficiently (public). The main importance of private involvement tends to be always speeding and ease of setup.

The private sector could be capable of mobilizing resources more quickly as well as deploying them more flexibly, as compared to the public or non-profit sector. Even though Canada has tried this initiative a more emphasis should be put in several of the sectors. For example, in radiation therapy, in order to attain sufficient rapid increase in capacity, they made a contract with new private company which allowed treatment of another additional 1000 per year, thus reduced wait times. This company depended on the spare capacity of non-profit hospital; equipment and location, on the other hand in its ability of recruiting new staff and paying them good bonus for working evenings, it happen to succeed while the non-profit sector had failed. The explanation for the success was revealed that was due to the organization's stand-alone entity (but not a part of a complex and already overburdened system) as well as many efforts that were put in improving the efficiency of service design.

The risk evidences of private delivery have been realized in different places of Canada, more so when the owner tend to be a large corporation that has to bring a profit to its shareholders. According to the evidences, public hospitals experience higher rate of mortality plus higher costs as compared to private hospitals. Sometime the market offers a strong temptation to skimp on quality for cutting the costs, as well as diverting resources from patients care to into profits. These tendency becomes difficult to prevent when the care delivery tend to prove to be complex and involves multiple, hard to observe inputs, for instance long-term care and hospitals. The issue will become less in case a small company has been contracted to offer a simple easy to monitor company such as laboratory. Another tendency of private providers is that they "cherry-pick" healthier patients while leaving the sicker ones to be attended to by the public system. However, it might not be necessarily a problem but an essential part of running a predictable, high-throughout service so long as the payment of the providers reflects the cost of the population that is to be treated, not as the average patient. In spite of the available risk, a research on the costs and quality of contracted-out elective services, in part due to the fact monitoring systems tend to be seldom in place. It becomes of significance to keep in mind that contracting with private providers will not always be synonymous with bringing the free market into health care.

The Canada government can find it possible to introduce market forces, especially competition among providers, while not having any form of private ownership. The government can also intervene in turning the private capacity into reduced wait times. Private companies will not likely to brave high the markets of healthcare entry and exit costs not until they are offered a guaranteed revenue stream, which always is supposed to come from the government. The government might even go to the extent of actively direct patients to the private service. In the case of English pilot project where the government was involved in buying the capacity from new independent, which was a private sector, long waiting patients were invited by the coordinator to have surgery in this place. Because of that, surgical activities rise while wait time went down. Although after the government subsequently paid for a more independent centre, such frequent failed to attract enough patients who were to use their capacity, (MacLeod H, Hudson A, Kramer S. et al., 2009). Amazingly, the response of the government was to fund yet additional centre having hope that they were to spur competition, but not to introduce a coordinator. Lastly, careful monitoring and tight contracts tend to be essential way of ensuring that a company genuinely meets the quality standards and do not be involved in poaching staff from the public system. Therefore, in case the government has the willingness of doing so, then opting to buy some types of private capacity could be a viable option of meeting a shortfall in treatment volumes. On the other hand the report of OECD indicated that, ranging from medium to long-term; it could be cheaper to expand activity by expanding public capacity.

Encouraging private capacity that is privately financed.

Even though public spending has a dominant role in Canada as well as other countries, they as well happen to have a role in private health insurance. While Canada allows complementary / supplementary private health insurance that covers fee and services that have not been covered by public insurance, some other countries have feature primary/substitute private health insurance which include either everybody posses private insurance or a section of the patients posses public while others private, but not having all of them. The ongoing debate is on whether private health insurance is capable of reducing waits is more concerns duplicate private health insurance, (Ciampolini J, Hubble MJ., 2005). Sometimes private health insurance is wrongly classified to be a demand-side strategy. It actually not intends to lower the total demand from the public to the private sector. In case our imagination put the nationwide treatment to remain the same, moving around demand can never possibly lower the population waits. What is assumed towards private health insurance promotion tends to be the idea that the supply of care will not remain the same. It is rather anticipated that in case more patients are capable of paying their own treatment, then there will be a rise in supply of private treatment, as well as more treatment to go around. Therefore it will be more accurate to describe private health insurance to be a supply-side strategy. Some of the cross-sectional studies are to the opinion that duplicate, in case anything duplicate private health insurance then it has to be associated with longer wait times.

This has been evidenced in Australia where they had a markedly shorter wait times, the reason behind it was private sector capacity. They had an active private hospital sector that had a contribution to the general capacity. They as well possessed a greater supply in terms of specialist physicians, which is a type of capacity that cannot be created by private sector.

Another problem of privately financed treatment consuming public resources is also experienced. Most of the countries tend to give their physicians the opportunity of practicing in both the private and public sector; hence they earn higher payments at the end. Such arrangement makes physicians have an obvious incentive of devoting their hours to private patients and they go to the extend of keeping their public waiting list long so that they may have no choice but to choose to attend private practice. This can be revealed by the nation of Australia in terms of promoting of private health insurance as a strategy of wait-reduction. In 1984, Australia introduced a universal public insurance, though they maintained a thriving market for duplicate private health insurance. By 1990s this promotion of citizens with private health insurance failed. In fact majority of Australians seemed to be contented with the use of public system, and they never considered private health insurance to be a good value for money not unless they looked forward for a significant health needs.

As much as there was a continued expansion of the treatment activity, private health companies were caught in the lose end of their revenue due to insuring sicker patients. However, later the government introduced an initiative of measure that was to encourage uptake of private health insurance. The argument of the government was that bolstering private health insurance was capable of reducing pressure on public system that was to reduce wait lists / time for public care. In the duration of 1999 to 2001, the Australians proportion with private health insurance had risen from 31 to 45% as well as the increase in private treatment went up. An average significance in the decrease of public wait time or list was as well realized.

Why will one find that the increase in private health insurance will fail to reduce pressure on the public systems? According to researches, the absorbed new patients and services by private health insurance is never a great source of pressure as such. The idea was that the growth within the privately financed activity was involving younger, patients who are of lower risk and requires shorter, higher profit, less complex procedures, such as day surgery, leaving all the labor intensive as well as treatment costs to the hand of the public system. Apart from shifting the demands from the public to private sector, this coming up of the private health insurance could bring up new demands especially for the services that tended to be profitable for private hospitals.

One of the major criticisms of private health insurance is because of its regressive form of funding. Since contributions tend not to be income adjusted, the rich becomes more likely of affording private insurance, and any other applicable co-payments. Looking at it in terms of equality perspective, to decide to go for private financing can be of justification in case it as well of benefit to patients who are relying on the public system, (McGowan T., 2003). It is not automatically that private financing will translate to be of greater capacity, and even if it becomes so, there could be failure of deploying the capacity in a manner that brings down the wait list. In addition any kind of new supply will always be distributed in terms of ability to pay, but not in terms of clinical need. For example, in other nations like Australia, more than a half the elective surgeries are recently private financed, and the elective surgery rate increases from socioeconomic advantage which is the opposite someone can expect in case treatment have been distributed as per the need. Promotion of private health insurance therefore stand to be an inequitable, indirect and proves to be an expensive method of increasing the supply of the treatment; yet it can as well be attained just with the same efficiency using other ways.

It is of great importance to redesign healthcare delivery in Canada for the reason of making the most out of existing capacity. Researches have indicated that inefficiencies, for example unnecessary steps, complex booking processes, avoidable delays, poor use of human resources as well as traffic jams, tend to be some of the factors that bound within the health care, and because of them, they are capable of creating long queues even if there is existing capacity that can meet the demand. Some of the ways to approach such problems may be through streamlining the patients' journey, pooling wait lists, consolidating services, maximizing scope of practice of professionals within healthcare, (Rachlis MM., 2005). Nevertheless, researchers have failed to come out with a high quality research based on the effectiveness of redesigning initiatives; this is in exception of some clear-cut interventions like promoting day surgery. It does not necessarily need to thoroughly evaluate the high profile nationally supported initiatives. For example some countries like Australia, their national hospitals programme came to be realized to create particular efficiencies, though its effect on wait times has never been measured.

Various researches have indeed showed that increased efficiency contribute to the reduction of wait times, though it has never come up with an intervention that shows the degree of impact. What makes things sometimes to be complicated is that you will never find that every kind of change introduced for the purpose of efficiency will definitely promotes efficiency. Initiatives that will be poorly conceived is capable of making processes to even become more convoluted, increase unproductive administrative tasks and bring new delays and detours on the part of the patients. Various projects that are billed as redesign will always rely on extra staffing or extra work that may not be easy to sustain. It becomes not difficult to promote improvement project at policy level, for example by funding them, however it becomes difficult to promote projects that tend to improve things. May be the most difficult could be making sure that local organization take part in the thorough, whole system analysis that is of importance in diagnosing the problem correctly hence coming up with a correct solution. It is of importance for a country to make significant efforts to disseminate and support best practices, but as much as such endeavors have indicated some local impacts, it become difficult to determine the extent of those affecting wait times at the national level, (Health Council of Canada., 2007). Using evidence that tend to poorly design system is capable of wasting significant amount of time as well as resources and to re-tool these systems could be the most correct approach of tackling wait times. Nevertheless, generally there is need for further research concerning the intervention and the strategies of knowledge translation that can steer the strategy to have a major large scale impact.