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Fraser Institute

Enough talk, we need to actually do something about Canadian health care

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12 minute read

From the Macdonald Laurier Institute

By J. Edward Les for Inside Policy

Canada spends more on health care as a percentage of GDP than almost all other OECD countries, yet we rank behind most of them when it comes to outcomes that matter.

I drove a stretch of road near Calgary’s South Health Campus the other day, a section with a series of three intersections in a span of less than a few hundred metres. That is, I tried to drive it – but spent far more time idling than moving.

At each intersection, after an interminable wait, the light turned green just as the next one flipped to red, grinding traffic to a halt just after it got rolling. It was excruciating; I’m quite sure I spied a snail on crutches racing by – no doubt making a beeline (snail-line?) for the ER a stone’s throw away.

The street’s sluggishness is perhaps reflective of the hospital next to it, given that our once-cherished universal health care system has crumbled into a universal waiting system – a system seemingly crafted (like that road) to obstruct flow rather than enable it. In fact, the pace of medical care delivery in this country has become so glacial that even a parking lot by comparison feels like the Indianapolis Speedway.

The health care crisis grows more dire by the day. Reforms are long overdue. Canada spends more on health care as a percentage of GDP than almost all other OECD countries, yet we rank behind most of them when it comes to outcomes that matter.

And we’re paying with our lives: according to the Canadian Institute for Health Information, thousands of Canadians die each and every year because of the inefficiencies of our system.

Yet for all that we are paralyzed by the enormity and complexity of the mushrooming disaster. We talk about solutions – and then we talk and talk some more. But for all the talking, precious little action is taken.

I’m reminded of an Anne Lamotte vignette, related in her bestselling book Bird By Bird:

Thirty years ago my older brother, who was ten years old at the time, was trying to get a report written on birds that he’d had three months to write, which was due the next day. We were out at our family cabin in Bolinas, and he was at the kitchen table close to tears, surrounded by binder paper and pencils and unopened books about birds, immobilized by the hugeness of the task ahead. Then my father sat down beside him, put his arm around my brother’s shoulder, and said, “Bird by bird, buddy. Just take it bird by bird.”

So it is with Canadian health care: we’ve wasted years wringing our hands about the woeful state of affairs, while doing precious little about it.

Enough procrastinating. It’s time to tackle the crisis, bird by bird.

One thing we can do is to let doctors be doctors.  A few weeks ago, in a piece titled “Should Doctors Mind Their Own Business?”, I questioned the customary habit of doctors hanging out their shingles in small independent community practices. Physicians spend long years of training to master their craft, years during which they receive no training in business methods whatsoever, and then we expect them to master those skills off to the side of their exam rooms. Some do it well, but many do not – and it detracts from their attention to patients.

We don’t install newly minted teachers in classrooms and at the same time task them with the keeping the lights on, managing the supply chain, overseeing staffing and payroll, and all the other mechanics of running schools. Why do we expect that of doctors?

Keeping doctors embedded within large, expensive, inefficient, bureaucracy-choked hospitals isn’t the solution, either.

There’s a better way, I argued in my essay: regional medical centres – centres built and administered in partnership with the private sector.

Such centres would allow practitioners currently practicing in the community to ply their trade unencumbered by the nuts and bolts of running a business; and they would allow us to decant a host of services from hospitals, which should be reserved for what only hospitals can do: emergency services, inpatient care, surgeries, and the like.

In short, we should let doctors be doctors, and hospitals be hospitals.

To garner feedback, I dumped my musings into a couple of online physician forums to which I belong, tagged with the query: “Food for thought, or fodder for the compost bin?”

The verdict? Hands down, the compost bin.

I was a bit taken aback, initially. Offended, even – because who among us isn’t in love with their own ideas?

But it quickly became evident from my peers’ comments that I’d been misunderstood. Not because my doctor friends are dim, but because I hadn’t been clear.

When I proposed in my essay that we “leave the administration and day-to-day tasks of running those centres to business folks who know what they’re doing,” my colleagues took that to mean that doctors would be serving at the beck and call of a tranche of ill-informed government-enabled administrators – and they reacted to the notion with anaphylactic derision. And understandably so: too many of us have long and painful experience with thick layers of health care bureaucracy seemingly organized according to the Peter Principle, with people promoted to – and permanently stuck at – the level of their incompetence.

But I didn’t mean to suggest – not for a minute – that doctors shouldn’t be engaged in running these centres. I also wrote: “None of which is to suggest that doctors shouldn’t be involved, by aptitude and inclination, in influencing the set-up and management of regional centres – of course, they should.”

Of course they should. There are plenty of physicians equipped with both the skills and interest needed to administer these centres; and they should absolutely be front and centre in leading them.

But more than that: everyone should have skin in the game. All workers have the right to share in the success of an enterprise; and when they do, everybody wins.  When everyone is pulling in the same direction because everyone shares in the wins, waste and inefficiencies are rooted out like magic.

Contrast that to how hospitals are run, with scarcely anyone aware of the actual cost of the blood tests or CT scans they order or the packets of suture and gauze they rip open, and with the motivations of administrative staff, nurses, doctors, and other personnel running off in more directions than a flock of headless chickens. The capacity for waste and inefficiencies is almost limitless.

I don’t mean to suggest that the goal of regional medical centres should be to turn a profit; but fiscal prudence and economic accountability are to be celebrated, because money not wasted is money that can be allocated to enhancing patient care.

Nor do I mean to intimate that sensible resource management should be the only parameter tracked; patient outcomes and patient satisfaction are paramount.

What should government’s role be in all this? Initially, to incentivize the creation of these centres via public-private partnerships; and then, crucially, to encourage competition among them and to reward innovation and performance, with optimization of the three key metrics – patient outcomes, patient satisfaction, and economic accountability – always in focus.

No one should be mandated to work in non-hospital regional medical centres. It’s a free country (or it should be): doctors should be free to hang out their own community shingles if they wish. But if we build the model correctly, my contention is that most medical professionals will prefer to work collaboratively under one roof with a diverse group of colleagues, unencumbered by the mundanities of running a business, but also free of choking hospital bureaucracy.

I connected a couple weeks ago with the always insightful economist Jack Mintz (who is also a distinguished fellow at the Macdonald-Laurier Institute). Mintz sits on the board of a Toronto-area hospital and sees first-hand “the problems with the lack of supply, population growth, long wait times between admission and getting a bed, emergency room overuse,” and so on.

“Something has to give,” he said. “Probably more resources but better managed. We really need major reform.”

On that we can all agree. We can’t carry on this way.

So, let’s stop idling; and let’s green-light some fixes.

As Samwise Gamgee said in The Lord of the Rings, “It’s the job that’s never started as takes longest to finish.”


Dr. J. Edward Les is a pediatrician in Calgary who writes on politics, social issues, and other matters.

Business

Federal Budget 2025: A responsible media would ensure Canadians know about the dismal state of federal finance

Published on

From the Fraser Institute

By Jake Fuss and Grady Munro

From 2014 to 2024, gross government debt (including federal, provincial and local governments) increased from 85.5 per cent of the economy (measured by GDP) to 110.8 per cent—a larger increase than any other G7 country. When debt grows faster than the economy, government finances are unsustainable.

Ahead of the Carney government’s long-awaited first budget scheduled for Nov. 4, a recent CBC commentary described the long-standing debate about the federal deficit and the state of federal finances as “something of a phoney war.” And that calls to balance the budget—expressed today and over the last decade—have lacked any serious discussion about the trade-offs between allowing deficits to persist versus balancing the budget.

While there’s certainly something to be said about the political theatre that regularly dominates the House of Commons—which we agree focuses too often on scoring political points instead of adequately assessing the merits of policy—it’s wrong to downplay concerns about the state of federal finances. Such concerns aren’t “phoney.”

Consider this. From 2014 to 2024, gross government debt (including federal, provincial and local governments) increased from 85.5 per cent of the economy (measured by GDP) to 110.8 per cent—a larger increase than any other G7 country. And federal gross debt increased from 53.0 per cent of the economy in 2014/15 to a projected 70.0 per cent in 2024/25. When debt grows faster than the economy, government finances are unsustainable. And the Carney government seemingly plans to continue this same approach.

In other words, the government plans to continue to spend more than it collects in revenue, continue to run massive deficits, and continue to rack up large amounts of debt.

Why should Canadians care?

Because the costs of government debt land squarely on their backs. For example, when government debt levels rise, the cost of debt interest often also rises. This year the federal government will spend a projected $54.5 billion on debt interest costs—equivalent to what it sends to the provinces for health care. Moreover, when governments borrow money, they can help drive up the cost of borrowing by increasing demand for the limited pool of savings that both government and the private sector compete for—making it more expensive for a family to take out a mortgage or businesses to attract investments. And to pay for today’s debt accumulation, governments in the future may raise taxes—a burden that will fall disproportionately on younger generations.

Again, given this alarming deterioration in the state of government finances over the last decade and the costs it imposes on Canadians, there’s nothing disingenuous about calling for more fiscal discipline from Ottawa.

Of course, getting federal finances back in order is no small task—the Trudeau government’s forays into areas of provincial jurisdiction (which carry huge price tags), combined with Carney’s massive new spending commitments for defence and other programs, mean the government cannot balance the budget without significant trade-offs. In the past, the federal government has overcome similar fiscal circumstances by committing to balance the budget and outlining a clear plan to achieve this goal. The Carney government should heed these lessons and apply them in its upcoming budget.

Jake Fuss

Director, Fiscal Studies, Fraser Institute

Grady Munro

Policy Analyst, Fraser Institute
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Alberta

Alberta taxpayers should know how much their municipal governments spend

Published on

From the Fraser Institute

By Tegan Hill and Austin Thompson

Next week, voters across Alberta will go to the polls to elect their local governments. Of course, while the issues vary depending on the city, town or district, all municipal governments spend taxpayer money.

And according to a recent study, Grande Prairie County and Red Deer County were among Alberta’s highest-spending municipalities (on a per-person basis) in 2023 (the latest year of comparable data). Kara Westerlund, president of the Rural Municipalities of Alberta, said that’s no surprise—arguing that it’s expensive to serve a small number of residents spread over large areas.

That challenge is real. In rural areas, fewer people share the cost of roads, parks and emergency services. But high spending isn’t inevitable. Some rural municipalities managed to spend far less, demonstrating that local choices about what services to provide, and how to deliver them, matter.

Consider the contrast in spending levels among rural counties. In 2023, Grande Prairie County and Red Deer County spent $5,413 and $4,619 per person, respectively. Foothills County, by comparison, spent just $2,570 per person. All three counties have relatively low population densities (fewer than seven residents per square kilometre) yet their per-person spending varies widely. (In case you’re wondering, Calgary spent $3,144 and Edmonton spent $3,241.)

Some of that variation reflects differences in the cost of similar services. For example, all three counties provide fire protection but in 2023 this service cost $56.95 per person in Grande Prairie County, $38.51 in Red Deer County and $10.32 in Foothills County. Other spending differences reflect not just how much is spent, but whether a service is offered at all. For instance, in 2023 Grande Prairie County recorded $46,283 in daycare spending, while Red Deer County and Foothills County had none.

Put simply, population density alone simply doesn’t explain why some municipalities spend more than others. Much depends on the choices municipal governments make and how efficiently they deliver services.

Westerlund also dismissed comparisons showing that some counties spend more per person than nearby towns and cities, calling them “apples to oranges.” It’s true that rural municipalities and cities differ—but that doesn’t make comparisons meaningless. After all, whether apples are a good deal depends on the price of other fruit, and a savvy shopper might switch to oranges if they offer better value. In the same way, comparing municipal spending—across all types of communities—helps Albertans judge whether they get good value for their tax dollars.

Every municipality offers a different mix of services and those choices come with different price tags. Consider three nearby municipalities: in 2023, Rockyview County spent $3,419 per person, Calgary spent $3,144 and Airdrie spent $2,187. These differences reflect real trade-offs in the scope, quality and cost of local services. Albertans should decide for themselves which mix of local services best suits their needs—but they can’t do that without clear data on what those services actually cost.

A big municipal tax bill isn’t an inevitable consequence of rural living. How much gets spent in each Alberta municipality depends greatly on the choices made by the mayors, reeves and councillors Albertans will elect next week. And for Albertans to determine whether or not they get good value for their local tax dollars, they must know how much their municipality is spending.

Tegan Hill

Director, Alberta Policy, Fraser Institute

Austin Thompson

Senior Policy Analyst, Fraser Institute
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