Canada: a health system in flux

Canada: a health system in flux

Canada’s overstressed emergency rooms do not provide an inviting portal to the nation’s healthcare system, long considered by international health experts as among the best in the world. Milan Korcok explores what this means for international visitors needing emergency treatment in Canada, as well as for the indigenous population

First published in ITIJ 100, May 2009

Canada’s overstressed emergency rooms do not provide an inviting portal to the nation’s healthcare system, long considered by international health experts as among the best in the world. Milan Korcok explores what this means for international visitors needing emergency treatment in Canada, as well as for the indigenous population

Almost weekly, newspapers and television stations amplify stories showing patients enduring 20 to 30-hour wait times in crowded hallways while provincial politicians do their photo-ops out front promising to funnel another few million dollars to relieve the pressure. On 20 February 2009, under the headline ‘Province to Cut ER Waits’, the Toronto Star reported (again) that patients with relatively minor health problems at the city’s busiest ERs could expect to be seen, treated and discharged in about 6.5 hours, while at the main University Health Network sites, patients with more complicated diagnoses such as cancer, cardiac or neurological conditions might have to wait close to 24 hours or more to be taken care of. Health ministry data show the majority of people admitted to hospital from an ER in central Toronto (representing 14 per cent of all patients who visit ERs.) can expect to spend up to 31 hours in ER, including both treatment and waits. Those not admitted can expect waits of 14 hours from triage to discharge.

ER backups tend to get the headlines, but they do not stand in isolation. Nationwide, such backups reflect deeper problems running through hospital systems: sicker patients, families without primary physicians using ERs for routine care, aging populations, patients taking up acute care beds who should be placed in alternative levels of care such as community-based long term beds, and lack of funding to expand, innovate, renovate and build.

the burden of wait times will neither be alleviated nor exacerbated by their status as visitors

For tourists or other foreign visitors or expats experiencing medical emergencies while in Canada, the burden of wait times will neither be alleviated nor exacerbated by their status as visitors as there is no option about where they will get their medical care. Normally, they will be taken to the closest hospital facility, endure the wait, be triaged, treated, and if necessary sent on to another level of care more appropriate for them such as a tertiary care teaching hospital or university centre of excellence specializing in the treatment they need, such as for head injury, multiple fractures, or cardiac care.  

Public or nothing

Despite delays and wait times, travellers and expats to Canada can still expect world-class hospitals and doctors, extensive transportation systems to evacuate or repatriate patients from all manner of locations – urban centre or remote sub-arctic bush – and assistance company access in virtually any part of this enormous country (the world’s second largest in area after Russia). In fact, airlifting patients from ice-bound villages was pioneered in Canada and has become part of the nation’s heritage as an aeronautical innovator – especially with skis fastened to the landing gear.

But unlike many European and Asian countries where private hospital networks catering to privately-insured patients run parallel to publicly-funded systems, Canada has only a single system of hospitals available to all residents and to tourists and visitors as well. No second tier. Almost all acute care hospitals in Canada are chartered and set up as ‘private’ not-for-profit institutions and are run by local boards of directors, regional health councils, or the university medical schools with which many are affiliated. There are no for-profit or investor-owned general hospitals and none set aside for the use of privately-insured patients. Neither are the hospitals owned by governments or the national health insurance system, known informally as medicare, although they rely on them for their operating budgets.

Private health insurance for medical services covered under medicare is also prohibited, although a legal challenge to such a prohibition has been upheld in Quebec, and private specialty hospitals and clinics are now cropping up across the country to challenge these prohibitions. (Recent surveys show there are now some 130 for-profit clinics currently operational, offering everything from MRI scans to specialised surgical procedures.)

Private insurance is restricted to supplemental items – travel insurance, dental care, drugs, long-term or nursing home care, disability cover, elective care, cosmetic services, and other items not ordinarily covered by medicare. Canadians are sensitive to the need for international travel insurance as Canada has no reciprocal arrangement with any other countries for coverage of its citizens while abroad similar to that in the European Union. Foreign travellers to Canada are also not covered unless they are legal residents of the province they are visiting – short or long term.

Consequently, an insured foreign traveller stricken by a medical emergency in Canada will not have the option of going to a ‘private’ hospital where the assumption may be that care, accommodations or access to technology or talent would be of a higher grade than in the ‘public’ system. The difference is that the foreign traveller or his insurer will be charged for their services – something that is not levied on domestic patients whose services are covered under global budgets allotted to hospitals by their provincial health agencies.

Furthermore, hospitals have a scale of rates they charge foreign patients that vary from province to province and even within locality and type of hospital, and administrators are not shy about admitting these revenues help ‘offset’ some of their indigenous costs. These charges can be five to six times what it costs to provide comparable services to domestic patients. So, if a foreign traveller gets sick in downtown Toronto, Montreal or Calgary, their insurer best be prepared to pay $5,000 or so per day, or more, for their hospital care. However, cost containment companies working the Canadian landscape have been shown to modify these charges somewhat. International cost containment companies, many of them headquartered in Canada, are now an integral part of every international insurer’s infrastructure covering patients anywhere in North America, but their dealings with hospitals are far different from those they employ with American hospitals. Because of the absence of private health insurance for core services, the American-style superstructure of PPOs, wholesale discounting for volume referrals by insurers, and third party managed care is non-existent in Canadian hospitals. Canadian hospitals do not have chargemaster rate manuals from which they negotiate discounts as Americans do because they do not charge the great bulk of their patients – medicare beneficiaries. Thus, the hammer and tong negotiations that American hospitals are subject to by such insurance giants as United Healthcare, Wellpoint and Aetna (with which many international cost containers sometimes partner) do not exist in Canada.

almost all acute care hospitals in Canada are chartered and set up as 'private' not-for-profit institutions

That is not to say that cost containment companies are irrelevant in the Canadian healthcare environment, just that they have a different role, and that is to see that the bills they are presented with – which can be substantial – are tested and sometimes challenged. Mike Starko, managing director of OneWorld Assist Inc., notes that negotiations with Canadian providers can be a completely different type of negotiation compared with US hospitals. For some health regions, non resident customers or insurers will not be offered any discounts and are simply not even set up to negotiate bills. Few hospitals are managed like a business resulting in limited availability of discounts.
“As healthcare budgets get squeezed,” says Starko, “more and more health regions and specific hospitals are focusing on and managing revenues from other sources including non resident patients. They are starting to use collection agencies for unpaid bills which only a few years ago would have been unheard of in Canada. We are also seeing non resident billing rates rise at a faster rate than the corresponding inflation, as this segment is now being viewed as an important revenue stream. The good news is that more providers are now willing and able to negotiate with cost containment companies in exchange for quick payment.”

A system undermanned

Will tourists to Canada and expats get the quality of care they expect of a system that has in the past been highly rated internationally? The short answer is Yes, but not as unconditionally as they might have a decade ago and not without some cost in terms of waiting in a system that is essentially undermanned.

The problem is there are just not enough doctors, they are unevenly distributed, and for well into the future Canada will have to rely on foreign-trained physicians, many from countries in far more desperate need of doctors than Canada. The College of Physicians and Surgeons of Ontario recently announced that 42 per cent of the record 2,961 physicians it licensed in 2006 were foreign-trained doctors and, for the third year in a row, more were IMGs (international medical graduates). With about 4.5 million Canadians reporting that they had trouble finding a family doctor last year, the shortage is ‘untenable’ nationwide, says the College of Family Physicians of Canada. The College says the country needs approximately 3,000 more family doctors, warning that the shortfall could hit 6,000 by 2011. The result of these shortages of manpower and technology is that about one million Canadians are on waiting lists for healthcare procedures and five million people (out of a total population of just less than 34 million) do not have access to a family doctor. According to the OECD, Canada is now 26th out of 28 in its doctors per population ratio – almost neck and neck with the US and UK. But lack of domestic medical manpower output, at times exacerbated by government decisions to squeeze down on medical school enrollments as a way of restraining national medic costs, has become chronic.

Economies of scale

The paradox in this picture of attrition is that Canada’s healthcare costs have now risen to record levels, estimated at $171.9 billion in 2008, $5,170 per capita, or 10.7 per cent of GDP. This represents total public and private spending. These levels push Canada into the upper stratum of countries in the OECD along with the United States, Norway, Switzerland, and Luxembourg. The US remains by far the biggest spender at about 16 per cent of GDP in 2008 and over $7,000 per capita.

Have these costs and manpower pressures resulted in lowered quality of care or sub-standard hygiene levels? Are visitors to Canada at increased risk of hospital infection or worse? Not likely, but according to Canadian perceptions of their healthcare access and quality, it isn’t what it used to be. And continuing media reports of MRSA and C difficile infections (particularly in Quebec hospitals) have not eased these concerns.

Canadian hospitals do not have chargemaster rate manuals from which they negotiate discounts as Americans do

In the 1970s and early 80s, when healthcare costs amounted to only about seven per cent of GDP, medicare was the nation’s single most prominent social achievement according the poll after poll. At that time, more than 80 per cent of Canadians polled assessed their healthcare system as ‘very good’ to ‘excellent.’ But despite the increased spending, public appreciation of the healthcare they receive has plummeted. Now, most polls show only a bare majority of Canadians think their healthcare is good or better. According to an Ipsos Reid poll, 61 per cent of Canadians thought of their healthcare system as ‘excellent’ or ‘very good’ in 1991: in 2000, only 29 per cent thought so. In 1991, 12 per cent thought it ‘fair’ to ‘very poor’ – a number that increased to 34 per cent in 2000.

Historically, Canadians have been intensely proud of medicare since its adoption 40 years ago. Its emphasis on egalitarianism exemplified the nation’s social values say its proponents. To just as many others it was something ‘The Americans’ didn’t have. In essence, many Canadians have a proprietary ideological attachment to medicare that offsets its apparent shortcomings. But the deterioration of respect for the nation’s healthcare over the past decade has been augmented by a polarizing debate over the role of the private sector in what has been a rigidly controlled single payer system.

Last summer, Dr Brian Day, the outgoing president of the Canadian Medical Association threw fat into the fire when he told the CMA annual meeting: “The private-public rhetoric on healthcare is a relic of tedious and tiresome propaganda. Those who relentlessly argue against and demonize the private sector need a reality check.” Dr Day owns and runs a private specialty hospital in British Columbia and has for several years been in the vanguard of a greater private sector role in Canada’s health system.

At the same annual meeting, Dr Robert Ouellet, incoming CMA president (who owns and runs five private medical imaging clinics in the Montreal area), pushed the case for private expansion even further when he asked: “Does it make sense, in the face of a shortage of operating rooms, to ban surgeons who provide 90 per cent of their services in a hospital from performing five to 10 per cent of their surgeries in private clinics?” This is a reference to prohibitions across the country preventing physicians from working in both private or public systems. The rule is: one or the other. Such rules, said Dr Day, have a deleterious effect on Canada’s medical manpower – already critically thin by international standards.  

negotiations with Canadian providers can be a completely different type of negotiation compared with US hospitals

Despite these conflicting tensions, Canada’s political parties have shown little inclination to challenge the basic tenet of medicare – that it remain a single payer government monopoly funding system free of undue intrusion from the private sector. Yet, a recent Supreme Court Case in Quebec recently ruled that a prohibition on private insurance for patients who could not be appropriately be taken care of by their provincial coverage was unconstitutional. And in the provinces of Quebec, British Columbia and Alberta, private, for-profit specialty hospital and clinics (knees, hips, diagnostic services,) are being set up and investors, many of them international, are seeking permission to provide the basic services medicare can’t.

Does this mean better access to a winder range of service for foreign visitors? Not unless they have come to Canada as medical tourists. The few for-profit clinics that exist are largely prohibited from providing the kind of emergency hospital care foreign tourists are covered for by their travel policies. For them, the general community hospital will be the first choice for any referral. Neither will they qualify for the knees, hips, diagnostic imaging and other supplemental services the  for- profits specialize in.

Cross-border care

In a not uncommon report, Toronto Globe and Mail reporter Lisa Priest in January 2008 wrote that more than 150 critically ill Canadians – many with life threatening cerebral hemorrhages – have been rushed to Michigan and New York State hospitals since the spring of 2006 because they could not obtain intensive care beds in Ontario. British Columbia too was forced to send patients with spine injuries to Washington state hospitals, and neighouring provinces Alberta and Saskatchewan have also been forced to relocate emergency patients to the US. But because foreign travellers are not covered under medicare, their travels to US specialty hospitals would not be covered by any Canadian government programme, although there would be no reason –other than economics –  why their insurer could not foot the bill to relocate them from Toronto to a brain injury clinic in Cleveland.

When Robert Bourassa, former Premier of Quebec, needed cancer treatment, he crossed into the US and obtained it at his own expense. When a leading Member of Parliament was diagnosed with breast cancer, in 2007, she went to the M.D. Anderson Center in Houston for treatment, at her own expense. Not all are tethered to waiting lists. Canadians by the thousands now go to the US for diagnostic imaging, radiation therapy, brain injury, cancer treatment, joint replacements, and a growing list of procedures not available to them in Canada. Sometimes these patients pay their own way, but most go at provincial expense under contracts written between provincial health ministries and US health centres.

Despite the sometimes acrimonious debates about the need for more consistent funding of healthcare and medical education, the quality of medical care one may expect in Canada is still high, particularly at the major university-centred networks of teaching hospitals such as those affiliated with McGill University in Montreal, the university of Toronto network (which includes such internationally renowned institutions as the Hospital for Sick Children), Dalhousie in Nova Scotia, the newer campuses such as McMaster University hospital in Hamilton, or Memorial University in Newfoundland; or the university centres in British Columbia, Alberta, or Ottawa.

As in the U.S., not-for-profit tertiary care centres affiliated with the nation’s medical schools rank as the top hospitals on everybody’s list.

Foreign travellers to Canada are also not covered unless they are legal residents of the province they are visiting

The Canadian medical landscape is a highly sophisticated environment where world class technology and talent are conflicted by stresses that impact many other less wealthy countries. With health costs rising faster than major economic indices, GDP, consumer price index or wages, Canada is no different from any other developed country. What makes the dynamic so paradoxical, is that though it is quite clear government is not adequately funding what Canadians think is their birthright, it, along with a majority of Canadians still rejects private sector funding healthcare – even though hundreds of millions of dollars in private investment capital stand ready to be transfused into it.