Quotulatiousness

April 19, 2011

Things that keep on rising in price … like healthcare costs

Kevin Libin points out that Michael Ignatieff may have been even more accurate than he himself realized:

The politicians are finally talking about it, but if you listened to what Mr. Ignatieff said during last week’s English-language debate, you might have found yourself feeling a bit depressed. Perhaps because the Liberal leader effectively argued that if Canadians wanted to keep getting decent medical treatment, they were going to have to learn to live without lots of other things.

“This comes down to a moment of choice,” Mr. Ignatieff intoned. Canadians could either vote for personal income tax breaks, planned corporate income tax cuts, new equipment for the Canadian Forces, all promised by the Conservatives, or, he said, “you can support health care.”

To be accurate, he used language that was far more politically loaded (“multi-million dollar expenditure on prisons … big gifts to upper-middle class Canadians”), but his message was the same: affording public health care means sacrificing other possible priorities.

There’s certainly much to suggest he’s got a point.

If our healthcare costs keep rising, unbounded by any kind of cost control, it will either consume the economy, or cause its collapse. And, of course, the large number of soon-to-retire Baby Boomers are about to need much higher health spending as the natural aging process starts taking its inevitable toll. Fun times ahead, folks.

Already, nine out of 10 provinces spend the majority of their own source revenues (which excludes federal transfers) on health care, according to the Fraser Institute’s report “Canada’s Medicare Bubble.” Only Alberta is just barely under 50%; Nova Scotia spends 88%.

With all the good will in the world, the government can’t keep increasing their healthcare spending . . . they’re almost out of money already.

2 Comments

  1. Michael Ignatieff may have a point but there is also service delivery. Do we really need millions of parents turning up with their snotty nosed children to get antibiotics for a cold? Somewhere along the line there needs to be a recognition that our health care costs are being caused by unnecessary visits, unnecessary drugs and unnecessary procedures that are going towards the doctor or hospital’s bottom line.

    Comment by Wallhouse Wart — April 19, 2011 @ 13:01

  2. I had a post up earlier this month about the (world-wide) problem of antibiotic over-prescription (here), and that is something that could be addressed to some degree by allowing user fees: if it’s “free”, people will over-consume the service. Even token charges can be sufficient to reduce silly use of the services.

    Unnecessary drugs is an incentive problem: drug companies make profits on newly developed drugs for a set period of time, then the generics are allowed onto the market. Most drug trials do not result in a salable product, so drug companies are always betting heavily on a small proportion of their R&D output being profitable in order to carry the non-performing majority. They maximize the profit by encouraging doctors to prescribe these profitable drugs. Doctors may not get direct cash kickbacks, but they are inundated with all sorts of other inducements to prescribe these drugs as much as possible.

    No quick fix of the Canada Health Act is going to be able to address the incentives problem.

    Comment by Nicholas — April 19, 2011 @ 18:21

RSS feed for comments on this post.

Sorry, the comment form is closed at this time.

Powered by WordPress