T HE H EALTH SYSTEMS OF C ANADA & THE USA Pauline Vaillancourt Rosenau, Ph.D. Division of Management, Policy, and Community Health UT Houston - School

THE HEALTH THE HEALTH SYSTEMS OF SYSTEMS OF

CANADA & THE USACANADA & THE USA

Pauline Vaillancourt Rosenau, Ph.D.Pauline Vaillancourt Rosenau, Ph.D.Division of Management, Policy, and Division of Management, Policy, and

Community Health Community Health UT Houston - School of Public Health UT Houston - School of Public Health

[email protected]

forforDoctor of Nursing Practice students

Room 706Room 706University of Texas School of Nursing

Thursday, February 17, 2011

OVERVIEW

Describe the Canadian health system and clear up some myths

Compare the two countries on CostsHow patients experience it How hospitals and doctors experience it Judging Canada and the USA on

performanceStrengths and Weakness of eachTry to figure out why

2

THE FIVE PILLARS OF THE “CANADA HEALTH ACT”

Public administration

Comprehensiveness

Portability

Universality

Accessibility

3

LIVING AND WORKING IN THE CANADIAN SYSTEM

With few exceptions, Canadians NEVER worry about incurring health care expenses.

Nor do Canadians have to submit claims to insurers.

Providers have ONE payer to submit claims to: the provincial government.

Canadian system is largely funded by general tax revenue - 25-50% federal.

4

THE CANADIAN HEALTH SYSTEM:TRUE OR FALSE?

Canada is “single payer” system? False: it is 10 payer provincial health systems with

“portability”

Each province is like one big HMO: True

The Canadian health system is “socialist”: False, most providers do not work for the government

but are rather paid by a piece rate system and

hospitals are not owned by the government

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THE CANADIAN HEALTH SYSTEM:TRUE OR FALSE? The Canadian government controls the

health system top – down False: federal – provincial authorities negotiate the

basics ; for example privatization

In Canada the bureaucracy wastes precious health care resources? False: The % of $ used for administration is much lower in

Canada than in the USA Billing is straightforward and electronic with 95% of

requested reimbursements completed.

6

THE CANADIAN HEALTH SYSTEM:TRUE OR FALSE?

In Canada the government controls prices? False: The government sets a budget, the

doctors set the payment rates in most provinces Canadians ration care by age, need, and

SES False: there are no policies that restrict care

on the basis of age, need, or socioeconomic status. Such discrimination is illegal

Canada allows euthanasia. False: Some US states have laws permitting

euthanasia but none of the provinces in Canada do. 7

8

USA COSTS WAY MORE THAN OTHER COUNTRIES

Health expenditure per capita varies widely across OECD countries.

The United States spends almost two-and-a-half times the OECD Average20

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1. Health expenditure is for the insured population rather than resident population.2. Current health expenditure.

Source: OECD Health Data 2009, OECD (http://www.oecd.org/health/healthdata).

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See slide : Commonwealth Fund International Health Policy Survey: Adults’ Health Experiences in seven Countries, 2007 – for methodology

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INTERNATIONAL COMPARISON OF SPENDING ON HEALTH, 1980–2008

0

1000

2000

3000

4000

5000

6000

7000

8000

1980

1981

1982

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1986

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1989

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1997

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1999

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2007

2008

United StatesNorwaySwitzerlandCanadaNetherlandsGermanyFranceDenmarkAustraliaSwedenUnited KingdomNew Zealand

Average spending on healthper capita ($US PPP)

0

2

4

6

8

10

12

14

16

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

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1991

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2002

2003

2004

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2006

2007

2008

United StatesFranceSwitzerlandGermanyCanadaNetherlandsNew ZealandDenmarkSwedenUnited KingdomNorwayAustralia

Total expenditures on healthas percent of GDP

Source: OECD Health Data 2010 (June 2010).


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WHY IS DOES THE US HEALTH SYSTEM COST SO MUCH?

Administration accounted for the largest share of this difference (39%),

Payments to MDs and hospitals accounted for (31%) of the next most important variables explaining difference

More intensive provision of medical services accounted for the was the third most important variable in explaining the difference (14%).

Research by professors from Harvard and Un. Of California in summer 2010; Inquiry

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Pozen and Cutler. Inquiry. 2010 Summer;47(2):124-34

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EXHIBIT 12. HIGH U.S. INSURANCE OVERHEAD: INSURANCE-RELATED ADMINISTRATIVE COSTS

Fragmented payers + complexity = high transaction costs and overhead costs

McKinsey estimates adds $90 billion per year*

Insurance and providers

Variation in benefits; lack of coherence in payment

Time and people expense for doctors/hospitals

$76$86

$140$191$198

$220$247

$516

$0

$100

$200

$300

$400

$500

$600

US FR SWIZ NETH GER CAN AUS* OECDMedian* 2006

Source: 2009 OECD Health Data (June 2009).

Spending on Health Insurance Administration per Capita, 2007

* McKinsey Global Institute, Accounting for the Costs of U.S. Health Care: A New Look at Why Americans Spend More (New York: McKinsey, Nov. 2008).

AND IT IS ALSO ABOUT GOVERNMENT INTERVENTION AND REGULATION

Canadians think they have “good government”

Americans distrust their government Canadians are comfortable with price

controls in the health sector Price controls in the health sector yield

lower costs Unlike other economic sectors unfettered

market competition does not lower costs

16

PHARMACEUTICAL SPENDING PER CAPITA: 1995 AND 2007ADJUSTED FOR DIFFERENCES IN COST OF LIVING

$385

$319

$335

$317

$228

$210$422

$431

$542

$588

$691

$878

$0 $200 $400 $600 $800 $1,000

US

CAN

FR

GER

AUS

NETH 1995

2007

Source: OECD Health Data 2009 (June 2009).* 2006

*

ANNUAL SALARY RANGE FOR REGISTERED NURSING JOBS IN CANADA

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Province step One Top of scale

Quebec $40,927 $60,319

Ontario $57,252 $81,315

$82,258 after 25 yrs of service

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HOW MEDICINE IS PRACTICED IN CANADA AND THE USA: FROM THE PATIENT’S POINT OF VIEW – ABOUT THE SAME

See slide : Commonwealth Fund International Health Policy Survey of Primary Care Physicians, 2006– for methodology

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HOW DO DOCTORS AND HOSPITALS GET PAID IN CANADA AND THE USA

PAYMENTS IN CANADA

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Fee for service for most primary care and specialists - bills sent to the province

Extra-billing of patient is NOT permitted No individual bills are prepared for patients Hospitals (largely private nonprofit) are paid on global

budget system with funds sent by the province; some regional health authorities obtain population-based funding (west) (HiT 2004)

Payment for pharmaceuticals varies by province and formularies are set up at the provincial level

What Canadian doctors are paid for treatments and procedures: ex. Gynecologist paid $45 for visit in B.C.

http://www.health.gov.bc.ca/msp/infoprac/physbilling/payschedule/index.html http://www.health.gov.bc.ca/msp/infoprac/physbilling/payschedule/pdf/26.%20ob

stetrics_gynecology.pdf

HOW DOCTORS BILL IN CANADA

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Billing is straightforward but lots of variation across provinces as each takes care of its on billing

Doctor must be registered as a practitioner in the province

Doctor must have a billing number – and not automatic

Doctor must be eligible and qualified to bill for the specific code indicated: ex. neurologist won’t be paid for doing an appendectomy.

The amount billed must be for the amount allowed by the fee schedule (Medical Services Plan)

HOW DOCTORS BILL IN CANADA (CONT..)

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Bills are submitted electronically on forms online through the web or via a direct connection to the MSP office – daily or weekly- and 98% reimbursed

The provincial payer organization sends payment twice monthly directly to the MD and pay interest on reimbursements that are delayed more than 30 days.

Ease of billing is a big plus in Canada and doctors who have billed in both Texas and Canada are in agreement on this : “One insurer, one fee schedule, rarely any question of eligibility and no incentive to withhold payment – its heaven compared to the US”.

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OUTCOMES IN THE CANADIAN HEALTH SYSTEM:CANADA DOESN’T DO TOO BADLY…

OVERVIEW: AMERICANS AND CANADIANS ON ACCESS AND HEALTH OUTCOMES

Very poor Americans are in poorer health than their Canadian counterparts

Wealthy Americans and Canadians – equally healthy

Little difference between insured Americans and Canadians as a whole -- on access to health care and health status

Americans without health insurance are – different, with low access to health care and more “unmet health care needs”

Alexis Pozen, David M. Cutler (2010) Medical Spending Differences in the United States and Canada: The Role of Prices, Procedures, and Administrative Expenses. Inquiry: Summer 2010, Vol. 47, No. 2, pp. 124-134.

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BUT THERE ARE WIDE VARIATIONS ON HEALTH LIFESTYLES

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Reference: Krueger, Bhaloo, & Rosenau; “Health Lifestyles in the U.S. and Canada: Are We Really So Different? “Forthcoming Social Science Quarterly, December 2009

COMPARISON OF U.S. AND CANADA: OUTCOMES

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Indicator Canada United States

Low Birth Weight Babies 6% 8%

MDs per 10,000 population

19 27

Nurses and Midwives per 10,000

100 98

Infant Mortality Rate 5.04 6.26

Life Expectancy – Female 83 81

Life Expectancy – Male 79 76

http://www.globalhealthfacts.org

The BEST Outcomes Measure

See slide : Measuring The Health of Nations: Mortality Amenable to Health Care, 2008– for methodology

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SPECIFIC OUTCOMES - MORTALITY RATES

Seven diseases favored CanadaColorectal cancer

Childhood leukemia

Kidney transplants

Liver transplants

One disease favors the U.S.Breast cancer

Hussey, P. et al, “How Does the Quality of Care Compare in Five Countries?” Health Affairs 23(3) May/June 2004

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SPECIFIC OUTCOMES- MORTALITY RATES

Overall RR of mortality 0.95 in favor

of Canada (CI 0.92 to 0.98)

Results quite heterogeneous

No explanation for heterogeneity

Guyatt, G. et al, “A Systematic Review of Studies Comparing Health Outcomes in Canada and the United States”, Open Medicine 2007;1(1):E27-36

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WAIT TIMES

Historically this has been the Achilles heel of the Canadian systemResult of budget cuts 1990’s

Today the situation is much improved

But the U.S. also has a “waiting times” problem, but for different reasons

In the US we wait because of cost….. In Canada patients because of scarcity

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SUMMING IT ALL UP

Strengths and Weaknesses And figuring out why….

CANADA – HEALTH POLICY STRENGTHS

Federal leadership, with state

autonomy on implementation, is a

workable compromise

Access is best when it is universal

Choice is ok – one big HMO

Primary care emphasis is important

Electronic medical records are not

essential39

WHAT CANADIANS SEE AS THEIR SYSTEMS WEAKNESSES

Waiting lists can be overused as “supply side” control mechanisms even if the MDs are in charge.

“Costs in Canada are too high.” Really? I guess it is always relative to your perspective.

Tolerance of a private sector “safety valve” may be essential if universal access is to be preserved

http://www.oecd.org/dataoecd/51/48/41925333.pdf40

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USA - STRENGTHS

Quality generally highLots of evidence that “more is not always better” when it comes to healthcare

But many patients don’t understand this or believe it.

Medical technology is available…if you are well insured…if not insured or underinsured… ?

No waiting if you pay out of pocket.

USA - WEAKNESSES

Cost - are way higher than in every other industrialized country with little to show for it.

Accessibility – may get better after 2014 ?

Administrative costs are high and this is unlikely to change after health reform is implemented. 42

WHY DO THE TWO COUNTRIES DIFFER AS TO HEALTH SYSTEM PREFERENCE? Culture – maybe but USA and Canada are converging; media,

proximity, culture diffusion, geographic mobility and immigration

History – Yes More distrust of government in US More emphasis on individual liberty

Form of government – yes Presidential system in the USA

Roots in the constitution Designed to require incremental policy rather than

comprehensive policy

Parliamentary system in Canada Good at implementing comprehensive change quickly and

efficiently Responsible party model Important role for party leadership

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SENATOR MITCH MCCONNELL SAID CANADIAN SHONA HOLMES HAD “BRAIN CANCER” HTTP://PATIENTSUNITEDNOW.COM/?Q=SEARCH/NODE/ENTER%20KEYWORDS

Diagnosis: Rathke’s Cleft Cyst on pituitary gland -- a benign cyst

Wait time in Canada would have been three months with no copay, no deductible

Cost for removal at Mayo Clinic = $97,000

"I knew in my gut that I had to see someone and could not wait five to six months," she says. So she called Mayo Clinic and got an appointment the same day.

Featured on the Mayo clinic website .http://www.mayoclinic.org/patientstories/story-339.html

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EXAMPLE OF MEDIA COVERAGE IN THE USA

The Case of Shona Holmes: http://www.youtube.com/watch?v=cahvnCBVXXU&feature=related

http://factcheck.org/2009/08/dying-on-a-wait-list/ same as above with Fact Check information

Mayo clinic charged 100,000$ - Shona’s story is no longer posted at Mayo Clinic’s website

Dr. Jason Huse, a pathologist at the Sloan-Kettering Cancer Center, in the USA . Factcheck.org says: “He told us something different.” "By strict definitions it’s not even a tumor," he said, but a remnant of embryological structures that eventually develop into the pituitary gland. Huse stressed that without having examined Holmes, he couldn’t know the prognosis of her RCC: "It is not out of the realm of possibility," he told us, "that this could have been impeding her hormone secretions to the extent that it was a life-threatening situation." And of course, we don’t know what Holmes’ American doctors told her. However, Huse said, RCC "is not typically a malignant lesion and it is not typically life-threatening."

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“U.S. NEWSPAPER COVERAGE OF THE CANADIAN HEALTH SYSTEM: A CASE OF SERIOUSLY MISTAKEN IDENTITY” AMER. REV. OF CANADIAN STUDIES – SPRING 2006, PP 27-58

Objective: This study assesses the fairness, accuracy, and comprehensiveness of U.S. newspaper coverage of the Canadian health system in two of the most influential newspapers published in the U.S.

Methods: Quantitative methods, interpretative assessments, and thematic analyses are employed to evaluate coverage of the Canadian health system in the New York Times and the Wall Street Journal between 2000 and 2005 46

U.S. NEWSPAPER COVERAGE …2 Findings: U.S. newspaper reporting on the topic of the Canadian

health system is found to be poor. Points of misinformation are indicated, misrepresentations are specified, and inadequate explanations are denoted.

Overall, ongoing themes and controversial issues regarding the Canadian health system receive almost as much notice in U.S. newspapers as actual news events.

Anecdotal information plays nearly as great a role in coverage as facts and evidence.

U.S. newspaper reports about the Canadian health system are found to be oversimplified.

Information, all too often, is presented out of context and sources are not always sufficiently identified.

Coverage is incomplete: all provinces are underrepresented in the U.S. newspapers studied, except Ontario.

Some articles are confused and a few were found to contain errors.

Conclusions: These inadequacies in newspaper coverage mean that the U.S. public is sadly misinformed with regard to the Canadian health system.

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REFERENCES FOR LEARNING MORE

And documentation for this lecture

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RESOURCES FOR LEARNING MORE ABOUT CANADA

Listen or View: “Does Canada's Health Care System Need Fixing? 10 August 2009” NPR http://www.npr.org/templates/story/story.php?storyId=111721651

Read: Ross and Detsky “Health Care Choices and Decisions in the U.S. and Canada”; JAMA 10/28/2009 ; 2009;302(16):1803-4, http://jama.ama-assn.org/cgi/reprint/302/16/1803

Read; Sanmartin, et al “Comparing Health and Health Care Use In Canada and the United States,” Health Affairs, vol. 25, July/August 2006 “ (Abstract ) http://content.healthaffairs.org/cgi/content/abstract/25/4/1133

View : “Sicko” by Michael Moore; Scene Selection # 7 Only “Canada!”: about 10 minutes that begins at minute= 40. See especially the Conservative party member (golfer interview) at Minute 48 http://freedocumentaries.org/teatro.php?filmID=133&lan=undefined&size=undefined

Listen: Audio Interview and Review of “Sicko” by Jonathan Oberlander – University of North Carolina; for ‘NPR’s program, Fresh Air” 2007. only the first 15 minutes are relevant - about Sicko’s presentation of Canada http://www.npr.org/templates/story/story.php?storyId=11826524

And investigate other countries such as Britain, Germany, Japan, Taiwan, Switzerland at: http://www.pbs.org/wgbh/pages/frontline/sickaroundtheworld/view/ 49

METHODOLOGY: COMMONWEALTH FUND INTERNATIONAL HEALTH POLICY SURVEY: ADULTS’ HEALTH EXPERIENCES IN SEVEN COUNTRIES, 2007

Survey of comparing Adults’ health care experiences in Australia, Canada, Germany, New Zealand, the Netherlands, the United Kingdom and the United States.

Method: Interviews with representative sample of adults, Age >17years, 2,500 in the United

States and 3,000 in Canada. Funded by the Commonwealth Fund, partnered with the Health Council of Canada to expand Canadian Sample.

Interviews conducted by telephone between 6 March and 7 May 2007 by Harris Interactive and Country affiliates

Conducted in different languages; French and English for Canada while Spanish and English in US

The margin of sample error for country averages is approximately + 2 percent for the US and Canada and + 3 percent for other five countries, at 95% confidence interval.

Peer Reviewed Publication Citation: Schoen, C., Osborn, R., Doty, MM., et al. Toward Higher-Performance Health Systems: Adults’ Health Care Experience in Seven Countries, 2007. Health Affairs (2007) 26(6) w717-w734

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METHODOLOGY: COMMONWEALTH FUND INTERNATIONAL HEALTH POLICY SURVEY OF PRIMARY CARE PHYSICIANS, 2006

Countries involved are Australia, Canada, Germany, New Zealand, the Netherlands, the United Kingdom and the United States

Methods: The survey consists of interviews with representative samples of primary

care physicians in seven countries using common questionnaire. Harris Interactive; country affiliates and in the Netherlands, the Center for

Quality of Care Research, Radbound University Nijmegen, conducted interviews by mail and telephone from late February through July 2006

Survey was conducted in English in the US and Canada. The margin of sample error ranges from +3 percent to +5 percent, at 95

percent confidence interval. Peer Reviewed Publication Citation: Schoen, C., Osborn, R., Huynh, P.T., et

al. On the Front Lines of Care: Primary Care Doctors’ Office Systems, Experiences and Views in Seven Countries. Health Affairs 25 (2006) w555-w571

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METHODOLOGY: SPECIFIC OUTCOMES-MORTALITY RATES

Joint US, Canadian authors from McMaster University, Hamilton, Canada

Meta-analysis of outcome studies 38 studies meeting most criteria for high quality (only one

missed criteria allowed) Publish or unpublished prospective or retrospective

observational studies comparing health outcomes data for patients with any age with same diagnosis in US and Canada

Sources included: EMBASE (1980-Feb 2003), MEDLINE (1966- Feb 2003), healthSTAR (1975-Feb 2003), EBM (2003) and dissertation abstracts ondisc (1969- Feb 2003).

Results were pooled using a random-effects model Cochrane’s Q-test was assessed to check heterogeneity and

relative risk was used as a summary statistics

Guyatt, G. et al, “A Systematic Review of Studies Comparing Health Outcomes in Canada and the United States”, Open Medicine 2007;1(1):E27-36

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METHODOLOGY: MEASURING THE HEALTH OF NATIONS: MORTALITY AMENABLE TO HEALTH CARE, 2008

Comparison of trends in deaths considered amenable to healthcare in the US, Canada and in 17 other industrialized countries.

Data and Analysis: Mortality and population data extracted from WHO files Data include deaths coded according to ICD-9-CM and ICD-10 by

sex and five-year age band. The general Age limit was set at 75 years. The causes of death considered are bacterial infection, diabetes, CVD,

treatable cancers, cerebrovascular disease and complications of common surgical procedures.

Age-standardized death rates (SDRs) per 100,000 population by sex was calculated for years 1998 and 2003.

Peer Reviewed Publication Citation: Nolte, E., & McKee, C. M. (2008). Measuring the Health Of Nations: Updating An Earlier Analysis. Health Affairs, 27(1), 58-71

Previous Publication Citation: Nolte, E., & McKee, C.M. (2003). Measuring The Health Of Nations: Analysis Of Mortality Amenable To Health Care. BM, 327, 1129-34

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Chen, Duanjie, and Jack M. Mintz. 2009. “The Path to Prosperity: International Competitive Rates and a Level PlayingField.” C.D. Howe Institute Commentary. No. 295. Toronto: C.D. Howe Institute. September

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Documents

T HE H EALTH SYSTEMS OF C ANADA & THE USA Pauline Vaillancourt Rosenau, Ph.D. Division of Management, Policy, and Community Health UT Houston - School