Canadian provinces move toward privatizing healthcare

Three premiers are taking initial steps that could change Canada's system.

By , Special to The Christian Science Monitor

Universal healthcare is as much a source of Canada's identity and national pride as the red maple leaf stitched to its flag. Ever since the groundwork was laid in 1947, universal coverage has been a right for all Canadians, regardless of their economic standing.

Yet while most Canadians are satisfied with the current system, economic pressure is building for reform. As a result, three provincial premiers are signaling a move toward privatization which could significantly alter the Canadian healthcare landscape.

"Our healthcare system is on life support and it is fading fast," said British Columbia premier Gordon Campbell recently.

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The premiers of Alberta, Ontario, and British Columbia say ballooning costs and long delays for some procedures can only be solved by private initiatives. Up to 40 percent of their provincial budgets goes toward healthcare.

Canada's healthcare system is actually run by its 10 provinces and three territories, but is governed by federal guidelines set out in the Canada Health Act. In exchange for following the five principles of the act - universal access, portability, public management, coverage of all medically necessary services, and no additional user fees - the federal government pays a share of the costs.

While the federal government originally promised to cover half of those costs, Ottawa's share has been declining for years. Currently its contribution hovers around 15 percent.

That amount of money, said Alberta's premier Ralph Klein, makes Ottawa "irrelevant" to the future of healthcare funding.

Indeed, premiers from all 10 provinces blame the federal Liberal Party government for the state of the system, and are forming a council, expected to be operational on May 1, to take that argument to the people.

But while some provinces are simply asking Ottawa to shoulder more of the burden, others like Alberta are making more radical, often controversial, reforms. In January, Premier Klein announced plans to cut some covered services, shift more payment responsibilities to patients, and hike health-insurance premiums.

The three provinces feel buffered by statements from Canadian Health Minister Anne McLellan, who has said that the national Liberal Party government is not opposed to more private hospitals. Currently, only a small number hospitals offer fee-based services for procedures not considered "essential."

Yet for a country steeped in social welfare tradition, the proposed changes are a tough pill to swallow.

"[Privatization proposals] are a serious attack on our national health care system by three of the most powerful premiers in the country," says Natalie Mehra, provincial coordinator of the Ontario Health Coalition, a public healthcare lobby group. "It's very dangerous," she contends. This would lead toward an American-style system, say analysts, that divides patients between those who can pay costs out of pocket and those who can't.

Additionally, under the terms of the North American Free-Trade Agreement (NAFTA), some analysts say US companies could demand access to all of Canada once one province opens the door to for-profit care.

Ottawa's dwindling share of healthcare funding has taken with it much of its leverage. As a result, Alberta and other provinces have been emboldened to "totally violate" the principles of the act, says Donna Wilson, professor of nursing at the University of Alberta in Edmonton. "Klein has been wanting to do this since 1993 when he was first elected," Wilson says. "One week later, he ... started talking about choice, for-profit healthcare, and contracting out jobs."

Ultimately, it is public opinion that may restrain the political proponents of marketplace medicine. Last year, a poll by Price Waterhouse Cooper indicated that 60 percent of Canadians supported the idea of expanding private health services as a way to solve the health crunch, and nearly half backed user fees.

Yet the same poll found that 75 percent of Canadians were willing to make "compromises," such as paying higher taxes to ensure that all Canadians have equal access to healthcare. More important, 99 percent of Canadians fully supported the Canada Health Act's five governing principles. Overall, 90 percent of the public rates the current system good to excellent.

"[Private] medical care costs more because companies have to make 25 to 30 percent profit to keep operating," says Shirley Douglas, spokeswoman for the Canada Heath Coalition, explaining why Canada spends proportionately less public money to provide complete medical coverage for all Canadians than America does while leaving 40 million people without any health insurance.

Others, however, see the provincial reform efforts as the only practical solution. "The guy who's got it right is Klein," says John Graham, director of pharmaceutical policy for the Fraser Institute, a Vancouver-based conservative think tank. Graham praised Klein's efforts to allow more private hospitals, eliminate unionized employees, and offer profit-based incentives as a way to improve healthcare. But, he says, this won't lead to "an American-style" system of medicine.

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