Wednesday, June 2, 2010

Our Neighbors To The North Are Cutting Back

Recently, we have been focusing on our neighbors to the south as we discuss issues of illegal immigration. But while we have been focusing our energies down there, something has been going on up in Canada. And it's big.

What is it, you may ask? Well, this: Soaring Costs Force Canada To Reassess Health Model. Oh, dear. Isn't this the model the Democrats claimed worked so well, and was one to emulate here in the States? Wasn't that the constant rallying cry to shove through Obamacare, whether we wanted it or not (and "or not" was what we wanted)? Were not those of us who tried to point out that there were very real problems with the Canadian system scoffed at, derided, and dismissed? Yes, yes we were.

Well, here's the thing. Once again, we were right, as the article mentioned above demonstrates:
Pressured by an aging population and the need to rein in budget deficits, Canada's provinces are taking tough measures to curb healthcare costs, a trend that could erode the principles of the popular state-funded system.

Ontario, Canada's most populous province, kicked off a fierce battle with drug companies and pharmacies when it said earlier this year it would halve generic drug prices and eliminate "incentive fees" to generic drug manufacturers.

British Columbia is replacing block grants to hospitals with fee-for-procedure payments and Quebec has a new flat health tax and a proposal for payments on each medical visit -- an idea that critics say is an illegal user fee.

And a few provinces are also experimenting with private funding for procedures such as hip, knee and cataract surgery.

It's likely just a start as the provinces, responsible for delivering healthcare, cope with the demands of a retiring baby-boom generation. Official figures show that senior citizens will make up 25 percent of the population by 2036.

"There's got to be some change to the status quo whether it happens in three years or 10 years," said Derek Burleton, senior economist at Toronto-Dominion Bank.

"We can't continually see health spending growing above and beyond the growth rate in the economy because, at some point, it means crowding out of all the other government services.

"At some stage we're going to hit a breaking point."

Huh. Here Canada is having problems, and their relationship with drug companies seems to be a tad bit different from the one Obama has. That is to say, they are actively fighting them, and fighting FOR their citizens, as opposed to Obama making a deal with Big Pharma from the Get-go which definitely was in Big Pharma's favor. Yt, Canada is having problems:

In some ways the Canadian debate is the mirror image of discussions going on in the United States.

Canada, fretting over budget strains, wants to prune its system, while the United States, worrying about an army of uninsured, aims to create a state-backed safety net.

Healthcare in Canada is delivered through a publicly funded system, which covers all "medically necessary" hospital and physician care and curbs the role of private medicine. It ate up about 40 percent of provincial budgets, or some C$183 billion ($174 billion) last year.

Spending has been rising 6 percent a year under a deal that added C$41.3 billion of federal funding over 10 years.

But that deal ends in 2013, and the federal government is unlikely to be as generous in future, especially for one-off projects.

"As Ottawa looks to repair its budget balance ... one could see these one-time allocations to specific health projects might be curtailed," said Mary Webb, senior economist at Scotia Capital.

Brian Golden, a professor at University of Toronto's Rotman School of Business, said provinces are weighing new sources of funding, including "means-testing" and moving toward evidence-based and pay-for-performance models.

"Why are we paying more or the same for cataract surgery when it costs substantially less today than it did 10 years ago? There's going to be a finer look at what we're paying for and, more importantly, what we're getting for it," he said.

Other problems include trying to control independently set salaries for top hospital executives and doctors and rein in spiraling costs for new medical technologies and drugs.

Ontario says healthcare could eat up 70 percent of its budget in 12 years, if all these costs are left unchecked.

SEVENTY PERCENT?? Well, I don't have to be a Nobel Prize Winner in Economics to know THAT is not good (though these days, accomplishments have become passe - ahem):
"Our objective is to preserve the quality healthcare system we have and indeed to enhance it. But there are difficult decisions ahead and we will continue to make them," Ontario Finance Minister Dwight Duncan told Reuters.

The province has introduced legislation that ties hospital chief executive pay with the quality of patient care and says it wants to put more physicians on salary to save money.

In a report released last week, TD Bank said Ontario should consider other proposals to help cut costs, including scaling back drug coverage for affluent seniors and paying doctors according to quality and efficiency of care.

Those sound like some possible options, but the outcome is unclear:

The losers could be drug companies and pharmacies, both of which are getting increasingly nervous.

"Many of the advances in healthcare and life expectancy are due to the pharmaceutical industry so we should never demonize them," said U of T's Golden. "We need to ensure that they maintain a profitable business but our ability to make it very very profitable is constrained right now."

Scotia Capital's Webb said one cost-saving idea may be to make patients aware of how much it costs each time they visit a healthcare professional. "(The public) will use the services more wisely if they know how much it's costing," she said.

"If it's absolutely free with no information on the cost and the information of an alternative that would be have been more practical, then how can we expect the public to wisely use the service?"

But change may come slowly. Universal healthcare is central to Canada's national identity, and decisions are made as much on politics as economics.

"It's an area that Canadians don't want to see touched," said TD's Burleton. "Essentially it boils down the wishes of the population. But I think, from an economist's standpoint, we point to the fact that sometimes Canadians in the short term may not realize the cost."

($1=$1.05 Canadian) (Reporting by Claire Sibonney; editing by Janet Guttsman and Peter Galloway)

Isn't that the single biggest issue right now? Once a social program has begun, people do not want to give them up? Isn't that what happened in Greece? Isn't that a big problem for the US, too? We continue to expand and extend programs that have massive benefits we cannot afford. For example, did you know in some states Unemployment Benefits were extended to 99 weeks? I'm sure you can do the math, but that's almost 2 years! Could that money not have been better used in a WPA sort of way? Or some other jobs-creation plan? There are claims that the EUC is actually expanding unemployment. That is, simply put, problematic.

But here's the biggest problem with the whole Canadian health care crisis compared to ours - our financial numbers were fudged. Only after the bill became a law did the REAL numbers start coming out, and they are NOT good. Check out what former CBO Director Douglas Holtz-Eakin stated recently:

Yikes. Again, this is what happens when a bill is rammed through without people bothering to read it first, filling it full of pork and giveaways, and expecting more service for less money. That is to say, it was fraught with problems from the beginning. We can only hope that before it is fully implemented, there is a massive overhaul or repeal.

I am all for people having health care, but as I have said before, let's be smart about it. Do our homework first. REALLY look at the numbers, get out of Obama's Big Pharma deal, and do right by all of our citizens, not corporations or political parties. Let Canada be a warning to us.


Mary Ellen said...

There's no doubt, the Seniors are going to be the first to be kicked under the wheels of the bus when it comes to health care.

My mom's medicare has changed where she can get her drugs now, from Walgreen's before to CVS now. When she was at Walgreen's, there were so many of them that they were never far away. Now I have to drive way out of my way to find a CVS and when I get there, even though they call to tell me meds are ready for pick up, they aren't. They've even shorted my mom's medication by 30 pills one time. Since we don't usually count them at the counter, the mistake wasn't discovered until a few days after I picked up the meds. I found out later that this particular CVS is so under-staffed that they make mistakes like that all the time. This is why they won the bid with the government, less money being spent on employees...which made it easier to underbid Walgreen's.

My mom also said that she is paying more for tests than she did before. They used to be covered in full by Medicare and now they are only paying a portion of the bill. Lucky for her, she also has an alternative insurance company, but they are now fighting so they don't have to pay for tests that Medicare won't pay for. It's a real mess.

Oh...and I also found out that the hospital near us has dumped the home nursing care for Seniors who leave the hospital after an illness but still need follow-up care at home (i.e. changing dressings on wounds, physical therapy, etc.). Now those Seniors have to find transportation back to the hospital or their doctors to have that care....not always easy when most of them can't even drive anymore, have a family member to drive them, or afford a cab.

But, hey...they're old and gonna die anyway, right? What did Obama say to Jane Strum? "Take a pill."

Rabble Rouser Reverend Amy said...

Wow, Mary Ellen - that is huge. Your mom is lucky she has you to go get her pills for her, but what abt the elderly people who have to drive themselves??

And that SUCKS abt the pills being shorted. I stopped using the closest CVS to me after they let go their outstanding pharmacist and got some guy in who is HORRIBLE. They failed to contact me in a timely manner that they were out of the painkiller my dog needed right before a holiday weekend. I had to scramble to get it filled at another one (she had bone cancer, and was in a lot of pain). Their callous disregard, and their complete lack of customer service on other occasions sent me running to another pharmacy. So, I can appreciate the frustration with them.

ME, the problems you laid out are big ones, indeed. What are people supposed to do who need these services? That $250 check Obama is going to send out sure isn't going to cover the increase in costs for even a month for most people, much less cover these kinds of expenses for a year.

Oh, wait, I forgot - you already said it. They're supposed to die already. Grrrr.

I bet you are glad to have the Obamas back in DC, aren't you? Though with the Blago trial starting, I am sure Obama's name will be invoked a number of times, eh? Can't believe the judge let Obama off the hook, though I shouldn't be surprised, I know...

Mary Ellen said...

It's amazing how the stench in the air just disappeared as soon as Air Force One left the Illinois airspace. I also think it's funny that the entire time he was here we were getting one electrical storm after another. Seems to me that perhaps it was a sign from above...heh heh heh.

I have no doubt that Blago's trial won't touch Obama, the Feds are making sure of it. It sure would be a treat if there was a leak of one of those taped phone conversations that Blago wanted the public to hear, something tells me that those that are being kept locked up go right to the top.

Rabble Rouser Reverend Amy said...

LOL - yes, I bet the air quality quickly improved in your neck of the woods.

Absolutely it was a sign with all of those electrical storms!! I mean, really, could it have been any clearer?? :-)

Oh, wow - wouldn't that be awesome if one of those calls got leaked? And really, ME, what in the world was so different abt what Blago did, WITH Obama, Rahm, and the whole pack of them, involved in the decision making, and what the White House is doing now??

And abt that - like none of us who were paying attention are surprised at the Chicago politics Obama et al. are playing? Sheesh.

Anywho - yeah - I'd love to see some of those phone calls see the light of day...