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A version of this commentary appeared in the Globe & Mail, the Canadian Healthcare Network and The Province

As a recent Globe and Mail investigation has noted, some Canadians have had to pay extra for care that they thought would be fully covered. The investigation reveals how complex this set of issues can be.

As many do not realize, Canada’s health-care system is not “public.” Unlike public school teachers, those providing health care are not government employees. What we call “public hospitals” are actually private, not-for-profit organizations. Canada’s system is what the OECD calls a “public contracting” model, which relies on public financing of private providers.

Neither is there a Canadian system. Because health care in Canada is deemed to be under provincial jurisdiction, there is considerable variation across the country.

However, to receive federal money, provincial insurance plans are required to fully fund all “insured services” to “insured persons.” For historical reasons, the definition of what qualifies as insured services is based both on being “medically necessary” and on who provides them (physicians) and where (in hospitals). As a result, only about 70 per cent of health care is publicly financed.

Private payment finances most dental care and a considerable proportion of rehabilitation, outpatient pharmaceuticals and long-term care. As care moves outside of hospitals, there is accordingly, increased scope for it moving outside this public funding model.

One implication of our current model is that, to the extent that services being provided in private clinics do not fall under the “medically necessary” definition, there is nothing illegal about additional charges. Cosmetic surgery or “executive health assessments” are obvious examples.

But as the investigative reporting noted, certain doctors have also found loopholes, where they can charge for additional services that fall outside the definition of insured services. One striking example was from an Ontario patient being asked to pay $495 to see a dietitian, which would not qualify as an insured service, in order to be placed higher on the list for a publicly funded colonoscopy. Other examples illustrate additional perfectly legal loopholes, including those relating to the treatment of work-related injuries that are (legally) paid for by workers’ compensation boards.

There are also differences in what the provincial funding bodies have decided are deemed to be insured services. For example, Ontario regulates what they term “independent health facilities,” which offer services that might otherwise be performed in hospitals, and prohibits them from charging “facility fees” to patients for services that would be publicly insured. Many other provinces do not, which allows providers to legally “double dip” since they are charging for additional services that are not necessarily publicly insured.

The investigation made a strong case for clamping down on these activities, although one could dispute the extent to which they are actually illegal as opposed to being ethically problematic.

The international evidence strongly suggests that there are few benefits to allowing private payment.

This is logical – there is no reason to pay extra for services that would be publicly covered unless what you could get for “free” is inferior or seen to be. Since there is no reason to pay to bypass a queue unless that queue is long, the evidence has found that allowing private payment does indeed make the publicly available care worse.

More promising approaches to improving wait times include both making sure the necessary resources are in place, and learning from engineers and improving queue management, including encouraging single points of entry.

A better question, in my view, is asking what we should be paying for. And, if we are going to invest more money, place it where we can improve peoples’ health. This may indeed mean that, rather than insisting people be treated in hospitals in order to receive necessary pharmaceuticals or rehabilitation, we extend the list of insured services to cover medically necessary care, regardless of where it is delivered or by who.

We must also recognize that more is not always better. Receiving a diagnostic test that isn’t needed, and the unnecessary radiation that may go with it, is not always a good thing. How many people without cancer should receive therapy that may damage them to avoid missing one case?

We shouldn’t be frightening people with the sense that not paying for more care – care they may not need and that may harm them – means that they may die. Instead we should be backing clinicians, including those at Choosing Wisely Canada, who are searching for the win-win of improved outcomes at lower costs.


Raisa Deber is a Professor at the Institute of Health Policy, Management and Evaluation, University of Toronto and an expert advisor with EvidenceNetwork.ca. Her newest book, Treating Healthcare will be released by University of Toronto Press in December, 2017.

June 2017


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