The current debate about the future of medicare has turned into a forum on the different values and perspectives of public and private providers, obscuring questions such as whether it would be cost-effective for wellness to be covered by the public health insurance program.
Whatever is not covered by medicare will be shifted to supplementary employer plans, or employees will have to foot all or part of the bills themselves.
The submission by the Canadian Chamber of Commerce in November 2001 to the Commission on the Future of Medicare, headed by former Saskatchewan premier Roy Romanow, said that “a world class health care system matters to Canadian business,” but input to the commission to date doesn’t reflect that.
Business has been silent
There are more than 140 submissions from organizations posted on the commission’s Web site. The voices of business and employers are conspicuously absent, although two of the leading organizations representing the insurance industry, the Canadian Life and Health Insurance Association (CLHIA) and the Insurance Bureau of Canada (IBC), raised issues that affect all employers.
In its submission, the IBC called for a permanent national campaign to create a “culture of safety” that will help prevent injuries, both on and off the job. Injuries account for an estimated 1.7 million days of hospital care a year across the country, according to data from the Canadian Institute for Health Information (CIHI).
The IBC estimates that in addition to that cost, more than $3.4 billion a year is spent on rehabilitation by provincial health insurance plans, workers’ compensation programs and private insurers.
CLHIA notes that more than 20 million Canadians are covered under private supplementary health insurance plans for a variety of benefits that don’t fall under provincial health insurance plans. Most of these people are members of group plans sponsored by employers, union or associations.
Total benefit payments through private supplementary insurance plans came to $10.6 billion in 2000, or 11.1 per cent of total Canadian health spending, a percentage that has held steady since 1998. Benefits include prescription drug coverage, which is the fastest growing area of expenditures. Other services such as employee assistance programs (EAPs) are often covered by supplementary insurance programs.
Nationally, supplementary plans were the fourth largest direct source of financing for Canadian health spending in 1998, trailing the government of Ontario (23.9 per cent), out-of-pocket payments by individuals (16.4 per cent), and the government of Quebec (15.4 per cent), according to the most recent data available from the CIHI.
As governments tried to contain rising health-care costs in the first half of the 1990s partly through significant cuts to public health insurance plans, “the de-listing of various services shifted the burden of financing these services to supplementary plans,” CLHIA said. That shift created significant tension between management and labour, as group premiums increased and employers explored options for reducing costs.
Benefits payments under supplementary health insurance plans constitute about 38 per cent of total health expenditures by the private sector, while out-of-pocket expenditures by individuals make up 55 per cent of the total, according to CLHIA.
Employers have so far kept a low profile in the debate about the future of medicare.
Romanow called on business to raise its voice “in a constructive and thoughtful way” about the problems and solutions facing the health-care system. But employers have stayed on the sidelines as the commission travels across Canada seeking public input, leaving the responsibility for speaking up mainly to the insurance industry.
Updating the system
Last fall, Romanow told the Business Council on National Issues “the real problem with medicare is that it was designed for another time,” and needs to be updated. But he stressed his opinion that medicare was the right decision when it was introduced, “and it remains so today.”
When medicare was established, health care was synonymous with doctors and hospitals. Today, they account for less than half of the total cost of health care.
And what about wellness? One of Romanow’s questions was whether medicare should cover wellness — prevention of disease, illness and injury. So far, there’s no evidence that anyone has sent him an answer.
Romanow had harsh words for abuse of the terms public and private in the context of medicare. “There is a difference between public funding, public administration and private service provision. The failure of key public figures to adequately distinguish between ‘provider’ and ‘payer’ issues is inexcusable,” he said.
Why wellness, and where’s the discussion of it?
The commission sees the sustainability of medicare as a major concern, but few submissions have focused on the costs and benefits of expanding universal health insurance to include services that do not relate directly to pharmaceuticals, hospitals and physicians. Some groups have argued for inclusion of home care or prescription drugs, but there has been almost complete silence about programs that promote health and wellness, or prevent disease and injury.
The Canadian Public Health Association (CPHA) submission said that “Canada needs to invest in strategies to prevent that which is preventable.” The CPHA stated that with the country’s changing demographics, “strong, well-funded prevention strategies will be increasingly critical to the health system as a whole.”
The submission of the Canadian Institute of Actuaries (CIA) noted that there has been considerable discussion about the impact of the aging baby boomer population cohort and the expected increase in utilization of existing services. The discussions have not focused on the fact that as the percentage of the population over the age of 65 increases, there will be proportionally fewer active workers to tax in support of government spending on health and other programs.
In addition, “discussions about the cost of health care do not typically include indirect costs, such as: sick leaves and disabilities, home care provided by family members and the costs of premature death. They also tend to exclude the cost of preventative measures such as workplace health and wellness plans and the provision of information on proper exercising, dietary habits and other healthy lifestyle guidelines,” the CIA said.
The CIA sees “the ratio of the over-65 population to the workforce is the crux of the problem for pay-as-you-go public-sector health plans, not the fact that people are living longer or that there are more of them.”
In 1975, there were seven workers for every person over the age of 65. By 2001, this number was about five and, in the next 25 years, it is expected to diminish further so that there will be only 2.5 workers for each senior.
Whatever is not covered by medicare will be shifted to supplementary employer plans, or employees will have to foot all or part of the bills themselves.
The submission by the Canadian Chamber of Commerce in November 2001 to the Commission on the Future of Medicare, headed by former Saskatchewan premier Roy Romanow, said that “a world class health care system matters to Canadian business,” but input to the commission to date doesn’t reflect that.
Business has been silent
There are more than 140 submissions from organizations posted on the commission’s Web site. The voices of business and employers are conspicuously absent, although two of the leading organizations representing the insurance industry, the Canadian Life and Health Insurance Association (CLHIA) and the Insurance Bureau of Canada (IBC), raised issues that affect all employers.
In its submission, the IBC called for a permanent national campaign to create a “culture of safety” that will help prevent injuries, both on and off the job. Injuries account for an estimated 1.7 million days of hospital care a year across the country, according to data from the Canadian Institute for Health Information (CIHI).
The IBC estimates that in addition to that cost, more than $3.4 billion a year is spent on rehabilitation by provincial health insurance plans, workers’ compensation programs and private insurers.
CLHIA notes that more than 20 million Canadians are covered under private supplementary health insurance plans for a variety of benefits that don’t fall under provincial health insurance plans. Most of these people are members of group plans sponsored by employers, union or associations.
Total benefit payments through private supplementary insurance plans came to $10.6 billion in 2000, or 11.1 per cent of total Canadian health spending, a percentage that has held steady since 1998. Benefits include prescription drug coverage, which is the fastest growing area of expenditures. Other services such as employee assistance programs (EAPs) are often covered by supplementary insurance programs.
Nationally, supplementary plans were the fourth largest direct source of financing for Canadian health spending in 1998, trailing the government of Ontario (23.9 per cent), out-of-pocket payments by individuals (16.4 per cent), and the government of Quebec (15.4 per cent), according to the most recent data available from the CIHI.
As governments tried to contain rising health-care costs in the first half of the 1990s partly through significant cuts to public health insurance plans, “the de-listing of various services shifted the burden of financing these services to supplementary plans,” CLHIA said. That shift created significant tension between management and labour, as group premiums increased and employers explored options for reducing costs.
Benefits payments under supplementary health insurance plans constitute about 38 per cent of total health expenditures by the private sector, while out-of-pocket expenditures by individuals make up 55 per cent of the total, according to CLHIA.
Employers have so far kept a low profile in the debate about the future of medicare.
Romanow called on business to raise its voice “in a constructive and thoughtful way” about the problems and solutions facing the health-care system. But employers have stayed on the sidelines as the commission travels across Canada seeking public input, leaving the responsibility for speaking up mainly to the insurance industry.
Updating the system
Last fall, Romanow told the Business Council on National Issues “the real problem with medicare is that it was designed for another time,” and needs to be updated. But he stressed his opinion that medicare was the right decision when it was introduced, “and it remains so today.”
When medicare was established, health care was synonymous with doctors and hospitals. Today, they account for less than half of the total cost of health care.
And what about wellness? One of Romanow’s questions was whether medicare should cover wellness — prevention of disease, illness and injury. So far, there’s no evidence that anyone has sent him an answer.
Romanow had harsh words for abuse of the terms public and private in the context of medicare. “There is a difference between public funding, public administration and private service provision. The failure of key public figures to adequately distinguish between ‘provider’ and ‘payer’ issues is inexcusable,” he said.
Why wellness, and where’s the discussion of it?
The commission sees the sustainability of medicare as a major concern, but few submissions have focused on the costs and benefits of expanding universal health insurance to include services that do not relate directly to pharmaceuticals, hospitals and physicians. Some groups have argued for inclusion of home care or prescription drugs, but there has been almost complete silence about programs that promote health and wellness, or prevent disease and injury.
The Canadian Public Health Association (CPHA) submission said that “Canada needs to invest in strategies to prevent that which is preventable.” The CPHA stated that with the country’s changing demographics, “strong, well-funded prevention strategies will be increasingly critical to the health system as a whole.”
The submission of the Canadian Institute of Actuaries (CIA) noted that there has been considerable discussion about the impact of the aging baby boomer population cohort and the expected increase in utilization of existing services. The discussions have not focused on the fact that as the percentage of the population over the age of 65 increases, there will be proportionally fewer active workers to tax in support of government spending on health and other programs.
In addition, “discussions about the cost of health care do not typically include indirect costs, such as: sick leaves and disabilities, home care provided by family members and the costs of premature death. They also tend to exclude the cost of preventative measures such as workplace health and wellness plans and the provision of information on proper exercising, dietary habits and other healthy lifestyle guidelines,” the CIA said.
The CIA sees “the ratio of the over-65 population to the workforce is the crux of the problem for pay-as-you-go public-sector health plans, not the fact that people are living longer or that there are more of them.”
In 1975, there were seven workers for every person over the age of 65. By 2001, this number was about five and, in the next 25 years, it is expected to diminish further so that there will be only 2.5 workers for each senior.
