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How Good Is Canadian Health Care? 2004 Report an International Comparison of Health Care Systems Critical2004 Issues Bulletin How Good is Canadian Health Care? 2004 Report An International Comparison of Health Care Systems by Nadeem Esmail and Michael Walker with Sabrina Yeudall Critical Issues Bulletins The Fraser Institute Critical Issues Bulletins are comprehensive studies of sin- Th e Fraser Institute is an independent Canadian economic gle issues of critical importance for public policy published and social research and educational organization. It has from time to time by Th e Fraser Institute (Vancouver, Brit- as its objective the redirection of public attention to the ish Columbia, Canada) role of competitive markets in providing for the well-be- ing of Canadians. Where markets work, the Institute’s in- Th e authors have worked independently and opinions ex- terest lies in trying to discover prospects for improvement. pressed by them are, therefore, their own, and do not nec- Where markets do not work, its interest lies in fi nding the essarily refl ect the opinions of the members or the trustees reasons. Where competitive markets have been replaced of Th e Fraser Institute. by government control, the interest of the Institute lies in To order additional copies of Critical Issues Bulletins, any documenting objectively the nature of the improvement or of our other publications, or a catalogue of the Institute’s deterioration resulting from government intervention. Th e publications, please contact the book sales coordinator: work of the Institute is assisted by an Editorial Advisory via our toll-free order line: 1.800.665.3558, ext. 580 Board of internationally renowned economists. Th e Fraser via telephone: 604.688.0221, ext. 580 Institute is a national, federally chartered, non-profi t orga- via fax: 604.688.8539 nization fi nanced by the sale of its publications and the tax- via e-mail: [email protected]. deductible contributions of its members, foundations, and other supporters; it receives no government funding. For media information, please contact Suzanne Walters, Director of Communications: For information about membership in Th e Fraser Insti- via telephone: 604.714.4582 tute, please contact the Development Department: Th e via e-mail: [email protected] Fraser Institute, Fourth Floor, 1770 Burrard Street, Van- couver, BC, V6J 3G7; To learn more about the Institute or to read our or via telephone: 604.688.0221 ext. 586; publications on line, please visit our web site at via fax: 604.688.8539; www.fraserinstitute.ca. via e-mail: [email protected]. Copyright© 2004 by Th e Fraser Institute In Calgary, please contact us Date of Issue: April 2004 via telephone: 403.216.7175 or, toll-free, 1.866.716.7175 Printed and bound in Canada via fax: 403.234.9010 via e-mail: [email protected]. Canadian Publications Mail Sales Product Agreement #0087246 In Toronto, please contact us via telephone: 416.363.6575 ISSN 1480-3666 via fax: 416.934.1639. Editing and design: Kristin McCahon Th e work of Th e Fraser Institute is assisted by an Editorial and Lindsey Th omas Martin Advisory Board that includes: Image for front cover: ©Photodisc, Getty Images, Inc. Prof. Armen Alchian, Prof. J.M. Buchanan Prof. Jean-Pierre Centi, Prof. Herbert G. Grubel Prof. Michael Parkin Prof. Friedrich Schneider, Prof. L.B. Smith Sir Alan Walters. How Good Is Canadian Health Care? 2004 Report An International Comparison of Health Care Systems Nadeem Esmail and Michael Walker with Sabrina Yeudall Contents About the authors & Acknowledgements / 2 Executive summary / 3 Introduction: How good is Canadian health care? / 9 How much does Canada spend on health care compared to other countries? / 12 Which countries other than Canada do not have cost sharing? A look at co-insurances and co-payments / 16 Which countries rely exclusively on government-managed hospitals to deliver publicly funded health care? / 24 Should Canada put its doctors on salary? / 27 Does Canada have too many doctors? / 32 Do other countries follow Canada’s model of monopolistic public provision of health insurance? / 34 Is the Canadian model of funding health care primarily from general tax revenues widely followed? What are the consequences of this system? / 38 How does Canada’s access to high-tech medicine compare? / 40 Canada spends more on health care than any other universal access country. Do we get our money’s worth? / 43 Conclusion / 53 Notes / 54 Appendix A: Sources for policy comparison tables / 56 Appendix B: Unadjusted ratios of physicians and technology to population / 57 References / 58 The Fraser Institute / 1 How Good Is Canadian Health Care? 2004 Report About the authors and Acknowledgments Nadeem Esmail Nadeem Esmail is Senior Health Policy Analyst and Manager of Health Data Systems at Th e Fraser Institute. He has a B.A. (Honours) in Economics at the University of Calgary and an MA in Economics from the University of British Columbia. He is the co-author of a number of publications on health-care topics, including How Good is Canadian Health Care?, a special, full-length edition of Fraser Forum (August 2002) and Waiting Your Turn: Hospital Waiting Lists in Canada, 12th edition. He is a frequent contributor to Fraser Forum and his articles have been published in newspapers across Canada. Michael Walker Michael Walker is the Executive Director of Th e Fraser Institute. As an economist, he has written or edited 50 books on economic topics. His articles on technical economic subjects have appeared in professional journals in Canada, the United States and Europe, including the Canadian Journal of Economics, the American Economic Review, Th e Journal of Finance, the Canadian Tax Journal, Health Management Quarterly and Health Aff airs. Since 1974, Michael Walker has directed the activities of Th e Fraser Institute. Before that, he taught at the Univer- sity of Western Ontario and Carleton University and was employed at the Bank of Canada and the Federal Department of Finance. He received his Ph.D. at the University of Western Ontario and his B.A. at St. Francis Xavier University. He is a director of a number of fi rms and other enterprises, including Mancal Corporation and Th e Milton and Rose D. Friedman Foundation. He is Chairman of Th e Pacifi c Academy for Advanced Studies and is on the Financial Post Board of Economists. In 1992, he was awarded the Colin M. Brown Freedom Medal and Award by the National Citizens’ Coalition and, in 2003, he received an honorary Doctor of Laws degree (LL.D) from Th e University of Western Ontario. Sabrina Yeudall Sabrina Yeudall is a fourth-year student at Simon Fraser University in Burnaby, British Columbia, where she is complet- ing a B.A. in Economics and Latin American Studies. She was awarded fellowships to participate in Leadership for the Americas, a program that enabled students from universities in North, Central, and South America to exchange ideas on public-policy issues. In the program’s inaugural year (2000), she presented a paper on Human Capital and Education and she returned the following year as the mentor for the SFU team’s Canadian Economic Development project. Ms Yeu- dall was an intern at Th e Fraser Institute during spring and summer of 2003 and was co-author of “Lessons from Japan’s Health Care System” (Fraser Forum, July 2003). She is currently working in the Property Management industry and run- ning a private tutoring and editing service. Acknowledgments Th e authors would like to thank the Max Bell Foundation for funds in support of Sabrina Yeudall during her internship at Th e Fraser Institute in the summer of 2003. 2 / The Fraser Institute How Good Is Canadian Health Care? 2004 Report Executive summary A new edition Which countries other than Canada shun user fees and other forms of cost sharing? Th is second edition of How Good is Canadian Health Care? provides answers to a series of questions that are impor- An important consideration in the use of health care re- tant to resolve if Canada is to make the correct choices as sources is the cost of access at the point of consumption. it amends its health care policies. Th e study is strictly com- Th e evidence surveyed in this study suggests that health parative and examines a wide number of factors for the care costs can be signifi cantly reduced if consumers of member countries of the OECD in arriving at the answers care have to participate in paying for the care they demand. to the questions posed. In this study, we primarily com- While bearing in mind that low-income citizens may be pare Canada to other countries that also have universal ac- exempted from paying user fees, the question is, do oth- cess, publicly funded health care systems. Since the United er universal-access countries share Canada’s notion that States and Mexico do not, we often ignore these countries user charges should be banned? In fact, most do not. More in the comparisons made. Th e study’s focus, therefore, is than three quarters of the universal-access countries in the not whether we should “abandon the key elements of Can- OECD also charge user fees for access to hospitals, general ada’s compassionate approach to health care delivery,” but practitioners, or specialists—and in many cases, to all three. how we organize to achieve it. To answer this crucial ques- In banning user fees, Canada is very much in the minority. tion, which is also the focus of the current debate about health care reform in Canada, we examine the policies fol- lowed in other industrialized, universal-access countries; Do other countries follow Canada’s model of monopolistic policies that, at lower cost, produce superior access to, and public provision of health insurance? outcomes from, health care than Canada’s policies do.
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