Saturday, February 23, 2008

Great White North – Part XLIV

Significant goings-on up north. The Castonguay Report is released - see the Toronto Star.

Signficant because, at least in Quebec, the provincial health system is characterized as “overburdened,” “wheezing” and “near a crisis point” - because it can “no longer sustain the annual growth in health-care costs.”

Cheese, really? In Canada?

Significant also because the Castonguay Report recommends that Quebec adopt strategies that the evil American insurance companies use - - increase premiums (i.e., taxes) and reduce benefits (i.e., copays and deductibles). Predictably, unions fiercely oppose these strategies and meanwhile there is a shortage of doctors.

Sounds familiar. But in Canada??

The article notes that “The province currently spends about $24 billion annually on health care, or about 40 per cent of its budget.”

Well, now. The 2007 population of Quebec was about 7,720,000. Its $24 billion annual expenditure on health care is equivalent to $3,100 annually per capita. If U.S. federal health care spending were 40% of our budget, the U.S. would raise about $1.6 trillion anually to finance health care spending - - or around $5,400 per capita.

So the Canadian per capita number seems 43% less than the U.S. number. Is so large a difference the result of superior Canadian health care management? Maybe it is. But what if not?

What if, just maybe, this difference really measures how easily health care demand rises to meet the supply of money? What if, just maybe, it demonstrates that the American economy is able to supply substantially more health care per capita than Canada’s? And what if the difference mainly means Americans demand substantially more health care than Canadians? Might that explain, for example, the more immediate availability of hospital and specialty care in the U.S.? If the higher level of health care supply in the U.S. is bad, does that mean the higher level of health care demand is also bad? If so, who shall be punished for this?

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