by Gary Bannerman
EDITOR'S NOTE: Gary Bannerman was a veteran Canadian journalist and
co-author of the book Squandering Billions (with Dr. Don Nixdorf and
illustrator Kerry Waghorn), analyzing Canada's national health care
system, but also focusing extensively on American experience and
It doesn't require a movie like Michael Moore's SICKO or the
rhetoric of a Presidential campaign to comprehend the astonishing
horror show of American health management. The U.S. spends vastly
more per capita on health than whatever nation is in distant second
place, yet the country's ranking among world nations in health
statistics is within a cluster of third world countries, dead last
among first world democracies.
The 40-50 million uninsured Americans, along with likely an equal
number of under-insured citizens, are the only people in the
civilized democratic world who live in constant fear of an economic
catastrophe related to health care.
How is this so? A disproportionate number of the world's best and
brightest in the health field, supported by the most advanced and
expensive technology and institutions, work all across the country.
The U.S. has the greatest health centres (Mayo, Johns Hopkins et
al.), the greatest medical schools (Harvard, Stanford, Duke Chicago
and dozens more) and some of the most advanced health care managers,
leaders in the "wellness" mission, a recognition that keeping
insured families well is more profitable than waiting for tragedy to
strike: The "Blues," Kaiser Permanente, Humana and others.
What seems so mystifying to the world is to listen to prominent
American politicians make a very simple principle and obvious
solution, sound so complex. The words of Barak Obama, Hillary
Clinton, John McCain and so many others who went before them,
resemble something from Mad Magazine.
- A simple goal: basic health care as an enshrined right of
citizenship - no citizen or resident ever fears losing their homes
or being driven into bankruptcy because of medical expenses, and no
visitor (even illegals) is ever denied necessary care.
- A simple solution: one national insurer for all basic and
life-threatening health services.
That's the norm in the free world. The United States is the sole
The fundamental flaw in all of the so-called "universal health care"
plans (it's hard to determine whose plan is more absurd) is that
they take a top down view. They start with the 40-50 million
uninsured and then basically say that we want to keep everyone else
intact - hospitals, doctors, HMOs, pharmaceutical companies and all
related institutions - without impacting upon their profit-structure
and business plans, and then cover everybody else, just as Medicare
serves the elderly and Medicaid looks after the poor.
It would be rather like announcing a new auto insurance company
pledging only to insure the demonstrably high risk drivers. The
financial medical establishment in the U.S. is wrong-headed about
this as well, feeling that a public system would be a mortal wound
to their profit structure. They would certainly have to change, but
they would have other valuable services to market. The good news for
them is that the preponderance of current claims costs would
disappear, virtually overnight. Current premium revenues would
change as well, but they would be based on the value they deliver to
corporate and individual clients.
Here's how it should work:
1. The national insurer is the U.S. federal government, entirely
financed from the tax base. The principles would be the same as any
HMO defining services and determining costs, with actuarial science
applied to the entire population.
2. A national program would be adopted outlining what is covered. A
comprehensive plan such as what exists in most democratic countries
covers consultations with health professionals, care for all
diseases, emergency health, most surgery and some pharmaceuticals.
The most sophisticated plans also include nurse practitioners,
chiropractors, homeopathic doctors and advanced multidisciplinary
health clinics, because all of these specialties tend to minimize
the need for drugs and surgery, the most expensive solutions that
often cause more problems than they solve.
3. Service delivery would be a State responsibility, including
hospitals, laboratories and fee negotiations with health
professionals covered under the plan. If the pattern of other
countries is followed, the State plan would assess an annual
insurance premium paid by individuals and families who are in a
financial position to afford it.
4. HMOs would build their business on extended coverages, such as
dental, pharmaceuticals, advanced diagnostics, wellness programs and
non-catastrophic medical treatments not covered by the national
5. Private practice health professionals would remain so. Instead of
chasing poor people for fee payment or submitting claims to an HMO,
they would submit the same bill to the State-managed branch of the
national insurance plan.
There is no standard template followed by all of the countries with
universal health care. In Canada - theoretically - it is illegal for
any doctor or hospital to directly bill a patient for a covered
service, or to impose any surcharge over published fees. In the
United Kingdom, there is a dual track system: everybody is covered
by public health and they are treated, when needed, by public health
doctors in private practice, or in public hospitals. But there is
also a large private sector pay-for-service health system. You (or
your insurer) can choose to pay a specific doctor or hospital for
what is perceived to be superior care, or you can choose public
health. A patient cannot submit a private health bill to the public
system for partial payment, but insurance plan premiums, private
medical services and hospital costs are tax deductible.
Most other countries of Europe and Scandinavia, as well as Japan,
have some kind of patient co-payment, a modest charge to discourage
abuse and to encourage patients to take some responsibility for
their own health. There are also ways to pay more through private
health to expedite and expand levels of care, but never at the risk
of compromising the core national Medicare plan.
If you follow the politics of any of these countries you will see
major health controversies and the appearance of dissatisfaction.
The theme of these debates is always for greater money and less
about effectiveness and efficiency. Nothing ever seems to get
measured in terms of quality service, as if more dollars
automatically ensured better care. Costs have soared, levels of
service sometimes appear to have deteriorated and political promises
Yet leaders in the evolution of health policy in all of these
nations share one common area of certainty: the U.S. system is a
tragic joke, the most abject mismanagement and political
irresponsibility in the health world today.
The president of the Mayo Clinic Dr. Denis Cortese, in a March 21,
2008 speech to the National Press Club referred to political debates
in which people are “talking about the health system being broken,”
leaving the implication that we might be able to go out and fix it.
In fact, he told the audience that there is no system at all, and it
is now time to design one, a system that starts and ends with the
patients’ perspective and the patients’ best interests at heart. He
emphasized that there needs to be more awareness of and
documentation of the tens of thousands of annual deaths due to
medical mistakes, as a cornerstone of subsequent efforts to do a
Michael Moore regularly holds Canada up as a beacon of civility in
contrast to the U.S. Despite our somewhat quiet national pride and
welcoming any pat on the back, most thoughtful Canadians cringe
every time he does it, because we have serious problems too.
We have replaced the discriminatory nature and excesses of
for-profit health with enshrined monopolies of bureaucrats, medical
doctors and hospital administrators. The theory of our national plan
- called Medicare - is that every citizen is insured and could
decide to seek treatment from all accredited professionals and
In practice, we have so enshrined the power base of medical doctors,
laboratories, pharmaceutical companies and administrators, they have
been able to so narrowly define coverages to ensure that most of the
money comes to them, irrespective of quality care. What is supposed
to be an insurance plan for individuals has devolved into a
guaranteed income scheme and fiefdom for insiders.
Our Provincial (like U.S. States) budgets now spend more than 40 per
cent of all available financial resources on health, and Finance
Ministers don't believe that many years will pass before we are at
50 per cent. Canada spends more on pharmaceuticals than it does on
fees and salaries for medical doctors. Politicians don't know how to
say no and none among them seem to have the courage to revisit the
roots of our universal care system in order to renavigate the
Think about the pending 50 per cent of all Provincial budget
expenditures! California currently invests 25 per cent of its budget
on health care.
Health spending is predominately a service-industry, an economy
built upon taking in each other's washing. Is it not the ultimate in
selfishness to exhaust resources on our own aches and pains, with
less concern about future generations. Where is the investment in
what will build society for tomorrow? Why are school budgets
languishing so that politicians can feign improvement of Medicare,
sprouting statistics about specific areas of alleged improvement. A
favourite is to cite record numbers of hip surgeries, despite these
patients being a sector of the economy mostly retired and no longer
contributing to the economy? Why are we financing the ingestion of
mountains of pills that seem to be doing society more harm than
good, and enriching those who manufacture and dispense them?
Canadian "adverse events" statistics are just as alarming as those
in the United States, more people killed or seriously injured as a
result of medical misadventures each year than all of the statistics
from highway accidents and crime combined. American deaths in the
Iraq war have surpassed 4,000 - contrast this to a suspected 100,000
deaths a year due to adverse events within health care.
Why is this not a major national initiative? Why are independent
autopsies not performed on all mysterious deaths within the health
system, just as they are if the death occurred in a private car or
Among the distinguished professionals who designed Canada's national
health plan is a University of Ottawa health economist, Dr. Pran
Manga. He is no less certain today than he was 40 years ago that the
Canadian plan is best for all affluent nations, but he despairs at
how we have allowed vested interests to distort the system.
In our book Squandering Billions, Dr. Manga gives the following
suggestions to get Canada back on course, thoughts that should also
be central to any new plan in the U.S.
Dr. Pran Manga cites a number of serious malignancies that have
sapped the potential of Medicare, largely creating today's crisis:
- The senior people do not put the public interest first and
foremost. They put the special interests first. Federal and
provincial leaders fight for budget. Once acquired, every
bureaucratic interest has a bite at it. Then follows regions,
hospitals and professional associations, each with an insatiable
shopping list. It is amazing that anything ever gets to the patient,
always the lowest priority in a real sense. The patients' most
useful role is to justify the building of empires and bank accounts.
- From the outset, the phrase "medically necessary services" was
never intended to be the exclusive domain of medical doctors. The
Act does not preclude coverage of other health professionals and
each of them, within their special niche, would save money and
improve results - dramatically so. But, from the beginning, the
Canadian Medical Association has put its own definition on the
government wording. They and the provincial associations seem always
able to hijack the process and secure relative exclusivity, a system
that guarantees the most expensive approaches possible for each
problem, no matter how minor, and duplication of costs as the MD
gatekeepers hand off to others.
- Governments can't seem to grasp the word "substitution" when
different services are considered. Study after study shows that if
nurse practitioner, optometric, chiropractic and other highly
specialized regulated professions are used, costs per patient go
down and outcomes improve. Drug utilization and rates of surgery
decline. Yet politicians and bureaucrats see these as "additional"
costs if they are not now covered and potential cost-cutting
targets, if they are currently part of the program.
- There is far, far too much bureaucracy. Each health practitioner
seems to carry an army of paper pushers on his or her shoulders.
- There is insufficient competition because of medical, dental and
pharmaceutical monopolies. Manga often cites the fact that British
Columbia has the lowest rates for dental hygiene services than
anywhere in Canada, simply because it is the only province which
doesn't give dentists an absolute monopoly on their services. B.C.
hygienists are the only ones permitted to have an independent
practice. In dental colleges, hygienists are professors. Manga says,
"the dentists say to the hygienist that you can be my professor, but
in the real world, you have to be my employee." The notion that
there is any vital health prerogative for teeth-cleaning to be a
monopolistic preserve of dentists is preposterous, a political gift
to an already wealthy profession.
- Despite overwhelmingly positive statistics from multidisciplinary
community health centres employing nurse practitioners, physicians
(usually on salary) and other health professionals as needed, there
has been too little progress on expanding the mode of care, again
because of opposition from the medical profession.
- Home care, convalescent hospitals and small surgi-centres should
be dramatically expanded, each with the aim of restricting acute
care hospitals to only the most serious of all cases, but this must
be done with political courage, eliminating all unnecessary
personnel and infrastructure as soon as they become redundant. Acute
care hospitals and trauma centres are not in the health and healing
business, but focused on procedures, serious illness and
emergencies. Convalescent patients or those with minor conditions
simply get in the way and become vulnerable to the adverse events
that haunt big hospitals.
- Pharmaceutical utilization and costs are out of control, with
about half of the $22 billion (2004 dollars, now in excess of $26
billion) annual expenditure a complete waste. "You cannot possibly
consider a pharmacare program if you have a bad system. ...the
system has to be fixed first." Any consideration of pharmacare
before addressing core issues would be profoundly stupid with
predictably devastating consequences.
- Manga says good policies work if the leaders are prepared to be
tough. Lamentably, that is too rarely the case. It is easier to
coast along tinkering with the status quo. There has been no
shortage of good ideas for health reform, but a lack of political
- Too often, the search for ideal, unanimous and even perfect
solutions prevents any improvements from taking place. "The best is
always the enemy of the good," he said. "Progress gets lost in
To use a popular sports colloquialism, governments "hit the wall" in
terms of health spending within the past few years. The 10 percent
of Gross Domestic Product we now invest stands up well by any
international comparison, but the services do not. We have been
going backwards. The share of provincial budgets as high as 48
percent is an unconscionable assault on everything else government
is supposed to do, and, to be brutally frank, spending 48 percent of
resources serving the current population is grotesquely unfair to
future generations, who have the right to expect a society made
better as a result of our inhabitation.
Therefore, some severe surgery and reconstruction is required:
- ADVERSE EVENTS - A study of a small slice of Canadian health care
determined that 185,000 patients are victimized each year as a
result of errors or diseases contracted within the system, and as
many as 23,750 of these people die. The research focused on hospital
records composed in somewhat of an "honour system" within the
institutions where the problems occurred. A Harvard-based expert on
this topic says that these records are never more than 5-20 percent
accurate. The truth is definitely far worse.
And, since this evidence represented only a selection of acute care
hospitals, and not the total field of drugs, surgery, doctors'
offices, other institutions and clinics, it may be correct to
project 50,000 unnecessary deaths each year as a result of medical
mistakes. The cost of treating errors must be multiple billions of
Various initiatives have more recently recommended third party
review of all incidents.
This is a tragedy and a crisis beyond imagination.
- DRUGS OUT-OF-CONTROL - Every professional study demonstrates that
50 percent or more of all drugs prescribed is a complete waste:
incorrect prescriptions, over-prescribing, dangerous conflicts with
other medication and unnecessary in the first instance. Experts
advise that we consume two or three times per capita the amount of
antibiotics used in Europe, without supporting evidence of more
disease requiring attention. The 2004 numbers show $18 billion in
prescription drugs and $3.8 billion in over-the-counter remedies.
Nothing has grown faster in health costs and there is absolutely no
statistical evidence that any of the additional cost has achieved a
system-wide benefit. Profits of drug companies have soared. Fees to
prescribing professionals remain robust. How many billions of this
total end up in toilets, garbage cans, gathering dust in medicine
cabinets and causing more harm than good - sometimes fatal - within
patients, no one really knows.
Government should consult experts such as Toronto's Dr. Joel Lexchin
about a return to compulsory licensing and a national purchasing
system such as that which operates so effectively in Australia. This
should be a top priority federal-provincial assault: fewer and more
accurately dispensed prescriptions, and a national purchasing
- COMPREHENSIVENESS - It is time to make the "comprehensiveness"
clause of the Canada Health Act as it was intended by its authors.
Vigorous policies to enhance the abundance and utilization of nurse
practitioners, chiropractors and all other regulated health
professionals would improve service, increase the emphasis on health
rather than disease, and significantly reduce the amount of
unnecessary drugs and surgery. There is a vast body of evidence to
support these claims.
An example of the savings possible is Dr. Pran Manga's
internationally accepted methodology analyzing what might be
possible if the Ontario Health Insurance Plan fully covered
chiropractic for neuro-musculoskeletal problems (one third of all
visits to the health system), rather than less effective medical
doctors. Dr. Manga's 1998 numbers estimated a minimum annual saving
of $380 million to a maximum of $770 million per year in Ontario
alone. His average or "likely" estimate of $548 million,
extrapolated nationally, would be $2.2 billion. Assuming an average
inflation of 3 percent since 1998, it would indicate a potential
national saving of $2.7 billion per year. Put another way, by not
following his 1998 advice, the country has squandered $10 billion,
completely irrespective of the hundreds of thousands of patients who
received inadequate or inappropriate care, and suffered
- ADMINISTRATION - Sometimes it seems as if Canada's leading health
statistic is the number of meetings, seminars, conferences, task
forces, Royal Commissions, and parliamentary inquiries than there
are treatment programs. Salaries in the managerial side of the
health system are ridiculous, particularly in hospitals and regional
health authorities, and cannot possibly be defended by any
accountability process. Hospital managers typically earn $300,000 to
$500,000, with every benefit under the sun, travel first class and
often get more in wrongful dismissal damages when fired, than when
they are at work.
Because there are 32 million shareholders in the Canadian health
network, a democracy in action, it is unrealistic to expect private
sector efficiencies and accountability. Private firms can be
selective about the work they do and how they report. Democracy is
cumbersome. But need we have a daily airlift of federal and
provincial bureaucrats travelling around inflating each other's
sense of importance?
- CO-PAYMENT - Nothing would impact more positively upon health
resources than an effort to encourage responsibility among both
doctors and patients. Co-payment - a modest user fee for
professional visits - should be considered. The amount is almost
irrelevant and the administration cost would be net zero. Half of
whatever is charged would be debited from professional fees paid by
the patient's medical plan. The other half would cover the
administrative cost of the new process at the point of care. Social
services recipients would be exempt; seniors and the working poor
would be refunded fully through tax credits. We are the only
universal access nation in the world that does not have a user fee
to encourage responsible behaviour by both patients and service
Despite all of the obstacles placed by the system to divert patients
from chiropractors, optometrists, naturopaths, podiatrists,
acupuncturists, physiotherapists, massage therapists and others, for
whom the patient or their insurer must pay some or all of the fees -
as opposed to the "free" medical doctor competition - these
professions demonstrate every day that people will pay for value
received. It is high time medical doctors earned the same respect
for their "free" medical services to patients.
- CLOSER TO HOME - The best investment in better and lower cost
future care would be a determined program to evolve small
convalescent hospitals, multidisciplinary Community Health Centres,
and comprehensive home care infrastructure.
If this is pursued with vigour, wherever possible encouraging
competition among professionals and provider organizations,
including private sector firms and non-profit organizations, it is
likely to have heavy up front costs, far in advance of any savings
from current hospital-based systems.
However, if the individuals we elect have the strength to ignore the
self-serving broadsides sure to come from today's monopolists, this
cannot fail to provide better and more economical health care in the
future. The up front investment, if amortized like a typical
business proposition, will prove to be exceptionally wise.
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