TORONTO (Reuters) – Pressured by an aging population and the need to rein in budget deficits, Canada’s provinces are taking tough measures to curb healthcare costs, a trend that could erode the principles of the popular state-funded system.
Ontario, Canada’s most populous province, kicked off a fierce battle with drug companies and pharmacies when it said earlier this year it would halve generic drug prices and eliminate “incentive fees” to generic drug manufacturers.
British Columbia is replacing block grants to hospitals with fee-for-procedure payments and Quebec has a new flat health tax and a proposal for payments on each medical visit — an idea that critics say is an illegal user fee.
Is this what we have to look forward to? The model the current administration is touting as the solution to our “health care crisis”?
And a few provinces are also experimenting with private funding for procedures such as hip, knee and cataract surgery.
It’s likely just a start as the provinces, responsible for delivering healthcare, cope with the demands of a retiring baby-boom generation. Official figures show that senior citizens will make up 25 percent of the population by 2036.
“There’s got to be some change to the status quo whether it happens in three years or 10 years,” said Derek Burleton, senior economist at Toronto-Dominion Bank.
So glad my hip surgery was under workman’s compensation.
“We can’t continually see health spending growing above and beyond the growth rate in the economy because, at some point, it means crowding out of all the other government services.
“At some stage we’re going to hit a breaking point.”
“Why are we paying more or the same for cataract surgery when it costs substantially less today than it did 10 years ago? There’s going to be a finer look at what we’re paying for and, more importantly, what we’re getting for it,” he said.
Other problems include trying to control independently set salaries for top hospital executives and doctors and rein in spiraling costs for new medical technologies and drugs.
Ontario says healthcare could eat up 70 percent of its budget in 12 years, if all these costs are left unchecked.
Seventy percent of it’s budget. Now we all know that the United States has a much larger population than Canada. Just imagine…can you imagine seventy percent of the Federal budget going to health care?
The losers could be drug companies and pharmacies, both of which are getting increasingly nervous.
“Many of the advances in healthcare and life expectancy are due to the pharmaceutical industry so we should never demonize them,” said U of T’s Golden. “We need to ensure that they maintain a profitable business but our ability to make it very very profitable is constrained right now.”
That’s right, hurt the companies that give everyone their longevity.