Health Care in Canada

The Hon. Allan Rock Minister of Health HEALTH CARE IN CANADA Chairman: Robert J. Dechert President, The Empire Club of Canada

Head Table Guests

John A. Campion, Partner, Fasken Campbell Godfrey and a Past President, The Empire Club of Canada; The Reverend Kim Beard, Rector, Christ Church, Brampton and a Director, The Empire Club of Canada; Fran Papasodaro, Student, Scarlett Heights Entrepreneurial Academy; Lorenzo Biondi, Vice-President, Drug Regulations, Information Quality, Hoffmann LaRoche; Dalton McGuinty, MPP, Leader of the Official Opposition, Ontario Liberal Party; Dr. Andrew SiMOT, Head, Department of Microbiology, Sunnybrook and Women's College Health Sciences Centre and Professor, Department of Laboratory Medicine and Pathobiology, University of Toronto; Catherine Steele, Vice-President, Ontario, GGA Communications and Third Vice-President, The Empire Club of Canada; Lillian Morgenthau, President, Canadian Association of Retired Persons (CARP); Murray Elston, President, Canada's Research Based Pharmaceutical Companies; and John Melville, President, Hoffmann LaRoche.

Introduction by Robert J. Dechert

Allan Rock

I'm delighted to be with this distinguished group at this head table today and to have the chance to speak to you about something that preoccupies us all. I saw that last week Murray MacKenzie spoke at this Club. He's the new President of the Ontario Hospital Association. It was a terrific speech, talking about the way we have to integrate services in the community. Next week Lynda Cranston will be here. She's done such a terrific job leading the new Canadian Blood Services which has been a source of such heartache for Canadians in the past. She and her board have really got us on the path to the point where public confidence is restored. I think it's very good that the Empire Club is focussing public attention on an issue that preoccupies us all. Can we keep our Canadian system of health care, of which we're so proud, into the new century? With an aging population, with increased pressures, with higher costs of technology, can we keep it? Now I happen to believe that the answer is a resounding yes and I say that not just out of political conviction but out of personal belief and I say it as a Canadian. I say that we not only can but we must keep what has become an icon of what we are as a country that reflects our deepest values and our commitment to each other as Canadians.

There are many, many things we have to do to succeed and many of them are technical. A lot of them Murray spoke about last week in terms of integrating services, reorganising care, putting a greater accent on community health centres and interdisciplinary teams working with physicians to meet public needs, and putting more emphasis on home and community care. Lillian Morgenthau, President of the Canadian Association for the Fifty-Plus, knows all about that and has spoken eloquently about it in the past. There's a whole bundle of things that we have to do if we're going to succeed in keeping timely access to quality care for Canadians. But before anything else, we have to have a commitment to the process. We have to believe that it's worth doing, and I believe it's worth doing. I believe it's so important to us as Canadians. The typical political rationale for the effort is based on social equity; that it is the best system because it's the fairest and because it doesn't distinguish between people on the basis of means.

There's also a strong economic argument for our system of health care in Canada and it's a powerful argument. If you look at the numbers, you see that in the 60s before Medicare we spent about the same percentage of GDP as the Americans-about 7 per cent. This current year we'll be just above 9 per cent of Gross Domestic Product on health care and the Americans will be over 14 per cent. Spending that much more, are the Americans providing services to everybody? They are not. Forty-three million Americans have no health insurance at all and worry about the day when they might have to choose between their health and their homes. It's estimated that 100 million Americans are under-insured.

You wonder what explains the difference between the Canadian and the American experience in terms of cost and you find that for the most part it's overhead. It's the cost of doing business. In fact a Harvard University study looked at the per-capita overhead and administrative costs for health care and expressed in U.S. dollars in Canada it was $272 per person per year but in the States it was $615 per person per year. Here's an example of how that happens. An American professor spoke in Toronto just last year and made the observation that a 900-bed hospital in Massachusetts had 350 people in the billings and the collections department. The Toronto Hospital which is of roughly equivalent size had 17 people in the billings and collections department. So the added expense of rating the population, determining risk, preparing and sending bills, making sure they're paid isn't there in a publicly funded single-payer system.

Look at the competitive advantage that we get from our single-payer system of health care. In Canada, healthrelated employee benefit costs are markedly lower than in the United States because Canadian employers don't have to buy insurance for all health coverage. In the U.S. businesses assume that cost and KPMG did a major study of this differential. They calculated that medical insurance accounts for 1.4 per cent of total gross payroll in Canada, whereas in the U.S. it costs 8.7 per cent of total gross payroll or over six times more. Last March the Conference Board of Canada published a study that looked at the cost of doing business on both sides of the border and concluded that to match the cost advantages of our health-care system, a business operation in the United States would have to earn pre-tax profits that were anywhere from 160-to-200-per-cent higher than the Canadian sites. The report concludes that business leaders and Canadians generally "should recognise not only Medicare's symbolic value but also its economic contribution to the competitiveness of Canadian business visa vis the United States." These conclusions have found expression by Canadian business leaders as well. Just last April Charles Baillie, the CEO of the Toronto Dominion Bank spoke to the Vancouver Board of Trade and he said: "Canada's health system is an economic asset, not a burden, one that today more than ever our country dare not lose." He concluded not only is our system fairer than the alternative; it's more affordable.

So it seems to me, that both in terms of social policy and in terms of economics, we're onto something here that we should work very hard to keep. I don't suggest it's going to be easy and we all have the stories of the waiting lists, the aunt who couldn't get the hip replacement for 18 months, the shortages of facilities and difficulty getting access to diagnostic equipment. We all know there are challenges. My point is that we have to mobilise a national will to meet those challenges. We can't let it slip away. Governments have to put aside political differences and we have to take the evidence about what works and we have to apply it to make sure we keep something that's of fundamental value to us as Canadians. It goes beyond politics. It goes beyond jurisdiction. It goes beyond mere dollars. We're talking about preserving and strengthening for our children the centrepiece of our social infrastructure. It's worth a national effort to do that and the debate should not be cast as a choice between the status quo and a parallel private system. That's not the choice. The status quo is unacceptable; we all know that. It has to change. We have to solve those problems and I believe we can.

There's increased pressure for a parallel private system. Sometimes people stop me and say: "Doesn't it make sense that if we do have waiting lists, if we do have problems with access, why don't you let me, if I can afford it, buy my way to the service? Why can't I have the choice?" At a certain level the analysis is sensible and perhaps compelling. I've taken the opportunity in the two and a half years I've been in this job to travel to other countries where such choices exist and speak to people who are involved in those systems. I've described the pressure here in Canada from some quarters to open that door and I have to tell you that almost without exception the people in countries where that parallel private system exists caution me against it. They emphasise that it's not the simple answer that it would first appear.

They talk about losing the best and brightest physicians and other health-care providers to the for-profit sector even if their involvement is only permitted as a percentage of their professional time. They talk about a parallel private system not necessarily being the answer to the waiting lists. England is a good example of that. The Harley Street surgeon is available to those who can afford him but the waiting lists in the public system are still a major problem for the British government. They talk about the fact that because business principles are at work, a private system will take the high volume, low-cost and profitable procedures but as soon as a complication arises they'll send the patient back to the public system so the public ends up subsidising the private part of health care. And they talk about something that's, I think, even more important. They talk about the political dynamic. If you take the most influential opinion-makers in society, the people who can afford it, and you resolve their concern about access to care, you reduce the pressure on governments to solve the problems in the public system. Sometimes the most influential people, the ones who can bring the greatest pressure to bear on governments to face up to these challenges, are no longer interested because they're looked after. I think that point has to be taken into account as well.

So I say to you that it's not beyond us as a nation. It's not beyond the ingenuity of Canadians. It's not beyond the means and the efforts of our governments and our professionals to find solutions to these problems and this is not the day to detail my view about that. I've spoken on other occasions about it and I've had the chance to speak with many of you but I do believe that it's within our grasp. As we're looking for challenges of which Canadians are worthy, one of them should be to restore to strength a health-care system that says much about us as a people and to ensure Canadians and their families equal and timely access to quality care. That's a challenge worthy of Canadians.

A couple of weeks ago in Charlottetown I met with the provincial ministers of health. We meet every year, sometimes more often, and there was a remarkable degree of commonality in our analysis and in our position as to what ought to be done. We talked about the issues that Dr. Hugh Scully and the CMA raised so well during the summer about physician supply. We talked about the supply of health-care workers generally, nurses as well as doctors, and we talked about what kind of delivery service we should have for primary health care and communities to take the best advantage of our healthcare professionals and to increase access to care. We've agreed to work away in the coming weeks and speak again in January to develop a plan, a strategy for dealing with health-care human resources and the delivery of services that will have broad support among the physicians and among the nurses and among governments and with the public and I'm determined to see that process through.

I think it's also terribly important when we're trying to analyse the challenge and design responses to have a base of information that's reliable and complete and that's why I'm very enthusiastic about the effort we launched with the Budget to put money and effort into a Canada-wide information database about the performance of our health-care system. Canadians spend $80 billion a year on health care and it's astonishing how little we know about what we get for the money. MacLean's magazine performs an important public service by producing what to my mind is at present the only coherent, intelligible, practical and useful, regular report on what's going on out there. We should do better than that. We should have a very complete and reliable public report to Canadian taxpayers about what they're getting for their money.

The Canadian Institute on Health Information is being funded to do just that. That institute is jointly owned by the Government of Canada and the provinces. The professionals are also involved and they're putting together a plan for accumulating, analysing and publishing information which will give you an idea of the performance of the health-care system-everything from the distribution of doctors and hospital beds, diagnostic equipment through to the discharge and readmission rates in hospitals, the differential outcomes, depending on treatment protocols chosen; a very complete sense of health care in Canada. The first report, which will be basic, will be out early in the new year and I think year by year as we polish and deepen and broaden that analysis and report we'll have in our hands a tool that we can use to better manage the health-care system, to point us in the direction of some of the answers of which I spoke earlier. Next time we have a debate about whether we're spending enough on health care or how much more we should spend or where it should be spent, perhaps we'll have some concrete evidence upon which to base our judgements, the way people do in the real world. I think it's important that we have that evidence for that purpose.

Let me impose just a few moments longer on you today to talk about something which is related to health care but doesn't get mentioned often enough in my view and that's health. I like to remind people that I'm the Minister of Health, not the Minister of Illness and it's often forgotten. There's a whole agenda having to do with wellness that too often gets overlooked. Now let me make two points. First of all I'm not talking about taking money from health care to devote it to health promotion. We know that every dollar in health care is needed there and when I speak about improving health I'm talking about one part of the strategy to make the health-care system more sustainable. If we reduce the demand by improving population health, it'll help us sustain health care into the future.

When we were in Charlottetown, Canadian ministers published the Second Report on the Status of Health of Canadians. It was encyclopedic and it told us vast amounts of information about how we're doing in terms of our health. Much of it was extremely encouraging as you would imagine, like the mortality rates. We're living longer; infant mortality is down. The indices basically are very encouraging. But there are also parts of the report that are very troubling. Hospitalisation rates for asthma among children up to the age of four tripled between 1971 and 1995. The incidence of both breast and lung cancer among women is up markedly. Almost 6 per cent of babies are born with a low birth weight, a significant precursor to later problems. Pre-term birth is a major reason and the national rate of pre-term births rose 13 per cent between 1982 and 1996. Accidental injuries, many of them preventable, are the leading cause of death among children and youth. Diabetes is becoming almost epidemic, particularly type 2 diabetes. The consequences can be grave, with circulatory problems leading to amputations and diabetic retinopathy is now one of the leading causes of blindness in Canada. Type 2 diabetes can in many ways be prevented, and its consequences managed very effectively with lifestyle changes. As well as working on saving health care, and without diminishing for a moment the importance of that challenge, we should also have a wellness agenda and that has to include three factors. First, research and information. Second, advice to Canadians on lifestyle choices that affect their health. And the third is getting at some of the external factors like the environment that play into health issues.

As for research and information, I'm delighted to tell you that we are about to transform the way research is conducted in this country. We all know how important research and development is. Those of you who are in business must regard it as a fundamental part of your investment. I'm sitting at a table with John Melville of Hoffmann LaRoche whose company sets a remarkable standard for its investment in research in this country and throughout the world. Murray Elston with PMAC can tell you how fundamental that investment in research is to the pharmaceutical sector. And the same should be true of the Canadian government. What we've done with the Canadian Institutes of Health Research is to take a proposal that came from the research community itself and change the way that we organise and fund health research in Canada. First of all, we will increase funding. We're going to double the amount we spend on health research over the next two years. Second, we'll change the way in which it's spent. We're going to bring all of the research perspectives to the table so that they can coordinate their approach on health issues-biomedical research which of course is fundamental, clinical research, research into health services and how they can be delivered more effectively, and research on determinants of health.

I'll give you an example. When the Canadian Institutes of Health Research are created, the governing council may well decide to recommend the creation of an institute on aging and that institute could do work on Alzheimer's. If it chooses to do so, it would look at that disease across the whole spectrum of perspectives. Biomedically, what is the molecular mechanism of Alzheimer's as a disease? Clinically, what pharmaceuticals or what treatments are most effective? With regard to health services, is it better to deal with persons afflicted with Alzheimer's in the community and if so, in what way? Or is institutional care better? Regarding health determinants, what is there about diet or the environment or lifestyle that might contribute to or complicate Alzheimer's? All of these perspectives would be brought to bear in a co-ordinated way-properly funded, across the country, in virtual institutes that will network the expertise that's out there, will accelerate discovery, broaden our horizon of scientific knowledge and put us in a better position to deliver better health care and better health to Canadians.

I'm very excited about this proposal because the Canadian Institutes of Health Research are going to set a world standard. I don't know if you saw on the front page of the newspaper last week the physician from Britain who developed the procedure involving ovarian grafts. He was in the newspapers saying he's leaving Britain and coming to Canada because he prefers our environment for scientific research and discovery. He said one of the things that's bringing him here is our creation of the Canadian Institutes of Health Research. That's the kind of signal we're sending to the world. It's an exciting time for scientific inquiry in Canada. I want to point out that with us here this afternoon is the Chair of the Interim Governing Council of the Institutes, who's also the President of the Medical Research Council-Dr. Henry Friesen. Dr. Friesen is the person who initially proposed this approach and whose energy and commitment has resulted in the fact that by the end of October, I'm going to be tabling legislation in the House to create the Institutes. He and his team have done an outstanding job of advising on the design and structure of the Institutes and Dr. Friesen, thank you so much for what you've done for Canada in that regard.

In terms of information and people's health, more and more of us are using the Internet. I think 38 per cent of the population now use the Internet. There's good and bad information out there and in the health area some of it is not always reliable and the consumer's left to wonder what can be believed. Over the course of the next month or so we're going to be drawing a lot of attention to something that we're doing. Health Canada is going to launch the Canada Health Network, a network of 380 reputable organisations that have websites with reliable data about health, health treatments, health care and health outcomes. Under the seal of approval of Health Canada, through the Canada Health Network, you will be able to gain access to information you can trust about a wide range of subjects of practical importance to Canadians. Our partners are growing week by week. The number of sites is burgeoning and soon it will be a remarkable collection of practical and useful information that you can trust.

So in terms of information and research I think we're making some important changes. In terms of personal lifestyle we're going to continue to discourage people from smoking tobacco. We're going to draw attention to the importance of physical activity as a way of preventing or managing diabetes and we are going to talk about diet and produce some nutritional labelling changes that will give you some practical advice when you buy food. In terms of external factors, we have to focus on environmental health and with my colleague, David Anderson, I will be doing that.

Let me mention one other thing before I concludechildren and health. We all know about the importance of an early start in life. Fraser Mustard and his colleagues have demonstrated the first three years have so much to do with later outcomes in terms of health. And it seems to me that when you're looking at ways to improve the population's health, starting early is an important part of that. That's why I am a proponent of the National Children's Agenda and why I think we should do more in terms of ensuring that children get the proper start. That of course raises the issue of the surplus. The Prime Minister has always said beating the deficit is tough but if you think that's difficult wait till we have a surplus and see how hard it is to develop consensus on what should happen with that. We campaigned on a balanced approach. We said roughly half to tax cuts and debt repayment and roughly half to reinvestment where it's needed. And we intend to do what we said we would.

First of all, there will be tax cuts. I spent 23 years just a block away from here practising law for a firm in downtown Toronto. I can well recall the way I felt every quarter when I sent that tax instalment cheque in. A lot of that additional taxation was said to be temporary to deal with pressures that we faced at the time. Well, the pressures have diminished and the burden of tax has to be reduced. We will be following through with that commitment. In terms of reinvestment it seems to me that Canadians will not support spending for no reason.. Not spending for its own sake. They want to know that if government's going to spend it's for something which improves the quality of our life or achieves a worthwhile purpose. It seems to me that public investment in things like health care, in children, in research will have the public's support as these will make our society more productive, more competitive, more prosperous and more successful. People also make our society fairer and more equitable and we all recognise that we must not only balance the books but we must also balance the scales of social justice.

The Health Agenda of tackling the challenges we face on the health-care side and focussing on specific goals to improve the health of Canadians will meet the priorities that Canadians themselves share as we go into this new millennium. The agenda that I've described reflects not only the policy of the government but the priorities of our people. Obviously there'll be a great deal to do in the balance of this mandate and into the next century, whether it's renewing our institutions, restoring the environment, reinforcing the role of the voluntary sector, restructuring health care or revolutionising research. We should take a page from our success in recent years and just as we pursued fiscal health with the Prime Minister's leadership and a collective determination, we should now pursue physical health and the well-being of our children as a worthy national goal. Let's target the illnesses that we want to prevent. Let's promote the lifestyles that we want to encourage. Let's give every child in Canada a decent start in life. And as we invest to gain a better standard of living let's also focus on a higher quality of life. Thank you very much.

The appreciation of the meeting was expressed by Catherine Steel Vice-President, Ontario, GGA Communications and Third Vic President, The Empire Club of Canada.