Wednesday, September 12, 2001
The Chronicle Herald

Debate on health care reform: no end in sight
By Brian Lee Crowley

THE HAMM government probably thinks it was gob-smacked by the recent pay settlements with health care workers. In a sense it was a blow, given the still-precarious state of the province’s finances and the looming deadline for the government’s election promise to cut personal income tax by 10 per cent.

But they ain’t seen nothing yet. Spending on health in Nova Scotia is rising fast, but still only absorbs about a third of spending. If you want to see what the future holds, look at Ontario, where health care now accounts for about 45 per cent of spending. That’s nearly half of all spending in the wealthiest province in the country. And every other province is heading there.

One obvious consequence has been the starving of other spending. Education and infrastructure such as roads are two areas that have been hard hit in terms of their share of spending all across the country.

Even on the current spending trends, health care will continue to outstrip both economic and population growth for the foreseeable future. According to the provincial ministers of health, provincial health spending will increase from roughly $56 billion to $85 billion in the next 10 years just to cover basic increases for things like population growth, aging, inflation, and rising costs for current programs.

But while most people are aware of these ordinary factors driving the present trends in health care spending, few of us realize that the trend itself will accelerate massively. In other words, just looking at aging, inflation and all the rest doesn’t begin to tell us how fast health care costs are going to rise in the coming years.

Three factors are going to push the rate of increase of health care spending much higher: technology, the increased incidence of chronic and new diseases, and the significant costs of system renewal. This could bring total provincial/territorial health spending to over $100 billion within 10 years.

Many of these cost accelerators are highly desirable things in themselves. Miraculous treatments for more and more difficult and exotic illnesses are emerging every day. The stem cell research that has caused such controversy recently looks likely to produce therapies for spinal cord, brain and other tissue and organ repair or regrowth. Those therapies will also be extremely expensive. Pharmacogenomics and genetically specific drug design, another promising field, will allow us to make “designer drugs” tailored to the needs of each individual. Diagnostic technologies such as MRIs and PET scanners will become much more widespread. Nanorobotics and other exotic delivery systems will improve treatments, but, again, raise costs significantly. Improved organ transplantation technologies, neo-natal surgery, genetic testing and therapy, the list of powerful new and powerfully expensive technologies seems as endless as the promise for improved health they hold out.

Other cost accelerators arise from changes in the patterns of health in the population. For instance, we seem to be facing increased exposure to exotic or new illnesses. Just think of HIV/AIDS, hepatitis C, and recent Ebola virus scares. Ease and speed of international travel guarantees that illnesses that emerge anywhere in the globe can be brought to Canada before the carriers even know they’re sick.

There have been significant increases in diseases such as heart disease, diabetes and tuberculosis. The incidence and prevalence of end stage renal disease have increased greatly, and with it the need for dialysis. Major joint surgery will increase significantly.

Two other factors will contribute to the ever faster rise in health spending. We really know very little about the health care system, how it works, who gets better and at what cost. Yet without this, we are operating in the dark. Not only the technology of medicine is changing, but so too is the technology of health care administration, and we must keep up. Ontario estimates that spending $700 million on information systems alone is required. Nationally, this could extrapolate to well over $1 billion. Research to develop and make known new technologies is indispensable and costly.

Finally, there are our own expectations as consumers. The Internet and other resources are making us better informed and, as consumers, we are more and more impatient of poor service and unreasonable waiting times.

This is why our politicians are striving to promote a reasoned debate about medicare. We live in a world where taxes are likely to be cut, not increased, and where other forms of vital public spending cannot be put off indefinitely. If Canadians are to have widespread access to the widest array of new technologies, the tax system will not be able to pay for everybody’s health care. It will be vital to supplement the public system by allowing those who can afford it to spend some of their own money on health care, while still ensuring equitable access for those who cannot pay. The health care reform debate has barely even begun.

Brian Lee Crowley is president of the Atlantic Institute for Market Studies, a public policy think tank in Halifax. E-mail: [email protected]