Canadian Medical Association Journal 1996; 154: 693-696
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Introduction
If you embark on discussions in Alberta about the future of health care, chances are that someone will tell you a story about a pig -- the health care pig. It goes like this.
A farmer had a barnyard full of animals, but felt particular fondness for one pig. This pig was brilliant: it had squealed for help when the farmer was trapped under his tractor, it had pulled a toddler out of a pond, it had alerted neighbours when their farmhouse caught fire. After hearing about the lifesaving heroics, a traveller asked to see the pig. He was surprised to discover that the animal was missing a leg.
"What happened?" he asked.
The farmer shrugged. "A fine pig like that," he said, "you don't butcher all at once."
The health care pig story is a favourite among medicare defenders in Alberta, which has seen larger cuts to its health care budget than any other province and the most aggressive attempts to develop a private health care system. Government critics argue that the public health care system is being slowly butchered, just like the pig. First one leg, then the next . . . and before we know it, the whole animal will be gone.
Nothing, of course, is that simple. Defenders of our publicly funded health care system know that medicare, unlike a pig, is in a constant state of change and flux. Still, the size of our health care pig has been shrinking for several years: the proportion of Canada's gross national product (GNP) spent on health care dropped from its high of 10.1% in 1992-93 to approximately 9% the next fiscal year. "The status quo is not sustainable," Alberta pediatric cardiologist Dr. Ruth Collins-Nakai argued during last August's CMA annual meeting. "We are left with a choice. We can either change or modify the current system or we can . . . adopt new principles."
Collins-Nakai is a firm believer in a health care system that is largely publicly funded and under close government regulation because "there is ample evidence to support the concept of a single payer system being the most effective."
She and other medicare defenders argue that it is still possible to provide all the health care Canadians need within the current publicly funded system, but radical change must be made in order to sustain it. We must reshape the pig without butchering it.
What changes will guarantee continued sustainability? Identifying the right initiatives will not be easy. "It's a living laboratory out there," says Carole Clemenhagen, president of the Canadian Healthcare Association. "We can't yet see what we've achieved." As well, different provinces are reforming health care in different ways: there are wide variations in cost-cutting strategies and new delivery mechanisms.
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Squeeze the hospitals
One process yielding significant cost reductions is captured in one buzzword -- re-engineering. Usually this refers to hospitals, which are the biggest consumers of health care dollars. The Ontario government has pledged to close or merge 30 hospitals within the next couple of years, while Saskatchewan has already closed the same number of rural hospitals.
Tony Dagnone, president and chief executive officer of the London, Ont., Health Sciences Centre, formerly University/Victoria Hospital, recently managed the second largest voluntary merger of teaching hospitals in Canada. He helped restructure two competing institutions into one hospital, with common management, governance and an integrated medical staff. His goal: cut $40 million from a combined operating budget of $400 million. He is still on track to meet this goal, but today is less certain, given the Ontario government's recent economic statement, that he will be able to divert the savings to meet unmet needs in the community.
Part of Dagnone's success has been tighter management, achieved through the kind of "delayering" strategies common in North American corporations. But clinicians have also played an important role. One physician-driven initiative has been the development of sophisticated "clinical-pathway" models. For instance, everything that happens to a heart-transplant patient between day 1 and day 30 has been tracked to see how the sequencing of tests and procedures can be improved. "We have been able to reduce length of stay, and the patient feels more in control of his or her own recovery," he says.
Dagnone argues that savings from improvements like these increase the viability of publicly financed hospitals. "I can compete with the Americans when it comes to cost and outcome of procedures, although they still manage lower length-of-stay figures than we do."
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Focus on effective care
Both Clemenhagen and Dagnone point out that hospital closures and rapid downsizing of the institutional sector are not enough in themselves to secure the future of medicare. "I'm worried that the emphasis on re-engineering and structural reforms is raising false hope that this is all we need to do," says Clemenhagen. "The changes were necessary, but the key to the future is building an ability to understand health care. What works? What are we doing to our patients? How effective are we?"
The London Health Sciences Centre is unusual in that projects such as clinical pathways identify interventions that can be eliminated because they have no proven clinical value. Clemenhagen points out that when it comes to both quality improvement and resource allocation, "many institutions are not implementing what we know. There is still rigid, control-oriented management when we need a much faster, more business-oriented approach."
Most hospitals are not using evidence-based decision making, even though guidelines have developed since the 1980s. There is also a wealth of medical information available on the Internet, but many physicians and other providers remain computer illiterate and unaware of software packages that would keep them up to date.
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Exploit new information technology
Part of the reason for foot dragging is a shortage of financial officers and entrepreneurial administrators in the health care system. Employers must invest in information technology that will enable providers to do more with less. Toronto's Hospital for Sick Children, for instance, now has a telelink with Thunder Bay, Ont., that allows videoconferencing and the transfer of images, links that expand health care services in underserviced region at minimal cost.
Moreover, squeezing the hospital sector only attacks one aspect of the problem. Andrew Vaz, national director of health care consulting at Ernst & Young, says "we must rethink the relationship of the parts to the whole system. We must ensure that both the institution and the doctors within it, for example, are aligned in the same direction."
The way physicians are paid is one element in this rethinking. Collins-Nakai argues that alternate payment methods should be adopted more widely because "not everyone wants the same thing."
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Use least-cost alternatives
Until now, health care professionals have focused on ensuring the highest standards within their own professions. Now they must focus on delivery and come together across professional boundaries. Many hospitals are developing "multiskilled workers" who cross job-description boundaries. Thanks to good relations with its unions, the London Health Sciences Centre has pioneered looser job definitions for hospital employees. "It means that a housekeeper is no longer just a housekeeper," explains Dagnone. "She can take on some of the responsibilities, for example, of the nursing assistants." This saves money and also means that the patient doesn't have to deal with as many strangers. Similarly, nurses are now doing tasks that used to be performed by physicians, and nursing assistants are taking over some of the nurses' responsibilities. Each "task bumping" represents a saving.
Quebec has already bumped much of its health care out of hospitals and into the community. Its CLSCs, or community service centres, provide a coordinated array of health and social services provided by physicians, nurses, social workers, occupational therapists, physiotherapists, counsellors and community workers. Family health care, inoculation services, health-promotion programs, home care and psychologic counselling are all on the menu. Moreover, the services are performed by the lowest-cost provider qualified for the job. In the Notre-Dame-de-Grace CLSC in Montreal, for example, there are only six physicians among the 150 staff members.
All Quebec residents have had access to CLSCs since 1988. Visits to a centre cost the system less than visits to physicians or a hospital emergency room, but there is a still cheaper alternative. CLSC users can now call a 24-hour information line and talk to a nurse. This avoids unnecessary, and expensive, consultations about the common cold or normal childhood illnesses.
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Restrict the definition of "medically necessary"
Almost one-third of Canada's health care spending already takes place in the private sector and the proportion is growing all the time, since medicare covers only items considered "medically necessary." This has always excluded dental care and most drug costs; today, governments are busy pushing additional items off their lists of insured procedures. In 1994, Ontario delisted the reversal of vasectomies and tubal ligations, most in-vitro fertilization and routine circumcisions, as well as the removal of tattoos and spider veins. In Alberta, routine eye examinations for those aged 19 to 64 are no longer considered medically necessary.
But there is no national definition of what medically necessary means. Andrew Vaz expects public debate on this issue to accelerate as ad hoc definitions narrow across the country. "Expenditures of millions of dollars are affected by where the line is drawn," he observes. "Clinicians and consumers need to participate in the discussion about what is in and what is out." The debate should not focus exclusively on fiscal pressures, he adds, but should cover arguments about personal responsibility for health and society's obligation to the poor.
Neither the federal government nor the CMA is anxious to start dictating a list, since such a top-down approach might push us too close to the American system of health care micromanagement, with its attendant encroachment on clinicians' judgement. "But the menu of insured services right now is too big and bloated," argues Dagnone. "The tax base cannot sustain it. We must identify core medical services, then see if private health insurance companies will cover the balance."
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Look for additional revenue sources
Vaz argues that the growth of the private sector is inevitable. "It's not just an affordability issue," he says, "it's also a market issue. There are tremendous market opportunities." Consumers want choice, and are willing to invest in their health and health care. Public-sector institutions might investigate the opportunities for generating extra revenue without compromising their primary mission.
How? Some of today's social and health care programs won't be available tomorrow, suggests Clemenhagen, who speculates that home-care services such as visiting nurses or meals on wheels may not be universally available. Entrepreneurial hospital administrators could then contract with a private company to offer home care on a pay-as-you-go basis without infringing the Canada Health Act. A patient who comes in for a hip replacement will be given a choice of different kinds of after care, with the level of service depending on how much she wants to pay. This means that tomorrow's hospitals will be dealing with multiple payers, and also points to tremendous opportunities for private health insurance to cover the growing market for nonessential services. "We'll see more market forces within the public system," continues Clemenhagen. "Internal markets could be the route needed to preserve our public framework."
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Political will
The efficiency and effectiveness of Canada's publicly funded health care system could be improved enormously by taking steps such as these. Most provinces -- Saskatchewan and New Brunswick are the best examples -- have already made their health care systems more efficient. They have weathered noisy protests from citizens who have lost services they had become accustomed to, and they have not unduly compromised the quality of their care. "The levers in the single-payer model have served us well in the push for cost reductions," Clemenhagen notes. "Compare Canada with the United States, where they have no controls over their hospital budgets, capital expenditures or number of physicians in practice and now spend more than 15% of their GNP on health care."
But new directions taken in the field are not enough to preserve our publicly funded system. "Without a change of policy direction by governments," comments Dr. Jack Armstrong, the CMA president, "we cannot maintain universality."
Armstrong, a Winnipeg pediatrician, acknowledges that recent cuts have made the system more efficient, but the quality of care is now being affected by continued chopping. "If we go on like this, our system will start to look like Solzhenitsyn's Cancer Ward."
What both Armstrong and Clemenhagen seek is a predictable, meaningful level of federal funding. Last November HEAL (the Health Action Lobby, an umbrella group representing health care organizations, including the CMA) told a Commons committee that Ottawa should permanently earmark a portion of federal transfers to the provinces exclusively for health care. Clemenhagen says this would ensure "that Ottawa has the moral and practical authority to expect compliance with the Canada Health Act." Without it, she argues, Ottawa will lose its clout and control. Every province will take the message that there are no national standards, and the publicly funded system will dissolve.
Will the federal government strengthen its commitment to the public system? Armstrong is not optimistic, because the CMA's discussions with the departments of health and finance have suggested that their only priority is fiscal restraint. And if the government took the step urged by HEAL, it would be abandoning its commitment to the other provincial programs that are partially financed by federal transfers: welfare and postsecondary education. In January, Finance Minister Paul Martin explicitly rejected the HEAL suggestion. "There is no doubt about the absolute necessity of ensuring that medicare is protected," he said. "But I also think there are other responsibilities out there as well."
Public opinion polls have a strong impact on political will. "I have seen a very acute shift of opinion within the past 8 years on how sacred health care really is," Vaz remarks. "Both Ralph Klein and Mike Harris are making much deeper cuts than they promised in their election campaigns, and by and large they are getting away with it."
If Canadians' attachment to medicare continues to loosen, it is unlikely that Ottawa will go out of its way to save it.