Financing only the first stage
A version of this commentary appeared in the National Post, Huffington Post and the Hill Times
As premier of Saskatchewan, Tommy Douglas was instrumental in introducing universal hospital insurance in 1947 followed by universal medical-care coverage in 1962. Without a doubt, these two pioneering experiments became the template for what we now call universal medicare in Canada. But it is essential to remember that rearranging the financing of the system so that everyone would have access to medically necessary care was only the first step for Douglas.
The critical second stage was a fundamental reorganization of the delivery system to build in more illness prevention and health promotion, and extend care beyond hospitals and physicians. This, he recognized, was the more difficult stage, and he always hoped and expected Canadians to meet that challenge after he retired from political life.
The fact that we have made only limited progress on the second stage of medicare during the last couple of decades is hardly his fault. Nor is it the fault of the political leaders who took Douglas’ model in Saskatchewan to build national medicare, from John Diefenbaker (a Conservative) to Lester B. Pearson (a Liberal).
There are at least three aspects of the Douglas model of medicare that should be celebrated, because they provide the sturdy foundation on which we can build the next stage of medicare. The first is universality, one of the five principles under the Canada Health Act. For Douglas, universality was the key to his reform.
In contrast, access to private health insurance is based on “ability to pay,” combined with your health risk profile. While you can avoid or mitigate this through employment-based health insurance, your access then becomes determined by the type of job you hold.
Douglas replaced this system with a tax-funded approach that allowed coverage to be offered to everyone, irrespective of job, age or pre-existing medical condition. After Douglas’ momentous reform, access to medical care became based on “need,” rather than “ability to pay,” or where you happened to be employed.
Although accepted by almost all Canadians today, universality was a contentious change at the time. In this, history provides a useful lesson in the outrageous claims made by the powerful anti-medicare coalition during the doctors’ strike in Saskatchewan in 1962. Contrary to what organized medicine, the insurance companies, business groups and almost every provincial government alleged at that time, medicare actually improved life for the vast majority of Canadians, including doctors.
The second essential dimension of Canadian medicare is public administration. Contrary to what is often assumed, this does not mean public delivery. But it does mean that any publicly-financed system of health insurance must be accountable to those who pay the piper and use the services — i.e., taxpayers and citizens through their elected representatives.
We call our system “single-payer” to distinguish it from systems where governments own and operate almost all aspects of the delivery system. In the late 1940s, for example, the government of the United Kingdom took over the ownership of all hospitals when it introduced the National Health Service (NHS). Far from an ideologue, Douglas never intended the government to own or control all aspects of delivery as long as there was accountability for public funding back to elected legislatures.
This brings me to the third essential dimension, what I will call the Douglas-Diefenbaker-Pearson legacy; and that is the federal-provincial nature of universal medicare in Canada.
This is a system in which the provinces are responsible for managing their respective system, while the federal government is responsible for providing the provinces with the incentive to adhere to a few common standards. This is no micro-management.
Moreover, not one of the five principles of the Canada Health Act prevents the provinces from being more entrepreneurial in the delivery of higher quality and more timely health services. Even under the current system, provinces cannot be forced to comply with national principles, such as portability; instead, they are induced to do so by federal cash transfers and the possibility of their partial withdrawal. But surely this is the minimum we should expect from the provinces for the billions of dollars they receive in federal health transfers.
Without this minimal federal role, the terms of access to health care will vary from province to province and portability will become a sham. This is precisely what we are in danger of losing, as successive federal governments provide cash transfers for health care with little or no concern for ensuring the integrity of the principles of the Canada Health Act.
On this, more than ever, we need Douglas’ vision, leadership and balanced understanding of our federation more than ever. Rather than go backwards to a time before medicare, we can focus on the more important business of reforming the health delivery system so that it will improve the quality of life for all Canadians, not just a privileged few.
Gregory Marchildon is an expert advisor with EvidenceNetwork.ca. He is also a Canada Research Chair and professor, Johnson-Shoyama Graduate School of Public Policy, University of Regina, and former executive director of the Romanow Commission.
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