"An Australian approach to health care in Canada would primarily require important changes to financial flows within provincial tax-funded systems, a greater reliance on competition and private ownership, and public support for private insurance and care."
The report suggests that the Canadian health care system would be greatly improved if provinces adopted reforms based on Australia's proven framework for providing high-quality universal-access health care at reasonable cost:
1. Consider adopting activity-based funding for health services and allowing private provision of hospital and surgical services.
Global budgets (the dominant form of hospital funding in Canada) disconnect funding from service provision. Conversely, activity-based funding, where funding follows the patient, creates incentives for hospitals to treat more patients and to provide the types of services that patients desire. The result is a greater volume of services from the existing infrastructure, reductions in waiting time, and improved quality and efficiency.
Introducing private provision inside a competitive framework also results in better system performance while ensuring access to quality health care. Importantly, private providers create greater competition, putting pressure on all providers (whether public or private) to operate more efficiently.
"Canada and Australia share the same goals for a health care system that provides patients with timely access to high-quality care, regardless of their ability to pay," Esmail said.
"Canada would take important steps towards fixing its ailing health care system if we adopted some of the policies that work for Australia."
2. Consider allowing private health care and insurance, implementing financial incentives for the purchase of insurance, and paying some portion of costs for private care. Canada's provinces should also consider allowing dual practice for physicians to maximize the volume of services provided to patients in both public and private settings.
Australia's superior health care performance is in part the result of a vibrant private parallel health care sector. The private sector in Australia plays a large role in both financing and delivering health care, most specifically elective surgery.
"When patients use the private parallel health care sector they free up resources in the universal system for patients who have opted not to seek private care. In Australia, supporting the private parallel sector may have helped reduce wait times and has helped contain health care cost increases," Esmail said.
Australia also allows physicians to work in both the public and private health care sectors rather than requiring them to opt out of the universal system. This has the benefit of making more efficient use of highly skilled medical resources.
3. Provinces should consider implementing cost-sharing regimes for universal health care with reasonable annual limits and automated exemptions.
A lack of cost-sharing (i.e. when patients are required to pay for a portion of their insured medical services) has resulted in excessive demand and wasted resources in Canada's health care system. Cost-sharing encourages patients to make more informed decisions about when and where it is best to access the health care system, thus increasing the cost efficiency of health care (ultimately reducing total spending) and improving access to treatment for those in need. Cost-sharing policies have been shown not to have an adverse effect on health outcomes as long as low-income populations are exempt.
Follow the Fraser Institute on Twitter / Like us on Facebook
The Fraser Institute is an independent Canadian public policy research and educational organization with offices in Vancouver, Calgary, Toronto, and Montreal and ties to a global network of 86 think-tanks. Its mission is to measure, study, and communicate the impact of competitive markets and government intervention on the welfare of individuals. To protect the Institute's independence, it does not accept grants from governments or contracts for research. Visit www.fraserinstitute.org
Add to Digg Bookmark with del.icio.us Add to Newsvine
Director of Health Policy Studies
(403) 216-7175 ext. 422
(416) 363-6575 ext. 235