Third edition of the Jean A. Pouliot Lecture Series with Donald J. Johnston, secretary-general of the Organization for Economic Cooperation and Development (OECD) from 1996 to 2006 and member of MEI’s Board of Directors.
Excerpts from an address pronounced by Donald J. Johnston
No subject appears to dominate the public-policy debate across the advanced countries of the world as much as health care. This area of social policy produces important and differing lessons that countries embarking upon reform should draw upon. Canada and other countries are at the crossroads, wrestling with making their health-care systems sustainable and affordable.
What should be the respective roles of the public and private sectors in both financing and delivering health care? This is the most difficult issue facing health-care systems everywhere. I see an increasing role for the private sector, which I believe can be compatible with the overall equity objectives of our health-care system.
Private health insurance plays a role both in Canada and in other OECD countries, but it differs very much from country to country. Public spending on health care across the OECD countries averages about 72.5 per cent of the total, with Canada slightly below at 70.3 per cent. The balance is financed by private health insurance or simply paid out of pocket by individuals. In 2000, only 11.4 per cent of Canadian health-care costs were financed by private health insurance, compared with 12.7 per cent in France.
Various countries see the use of private health insurance differently. In some cases, it provides primary coverage for different population groups (for example, in the United States, Germany and formerly in the Netherlands.) In other countries it provides a supporting role for public systems. In Australia, Ireland, New Zealand and Britain, private-insurance-funded providers operate in parallel to the public delivery system, offering a private alternative.
In many countries such as France, private health insurance complements financing from public programs. In others, like Canada, private health insurance supplements public systems by financing goods and services excluded from public coverage.
In his 2002 report, Roy Romanow took a position that I respect but with which I disagree. He states that we must not regard our system as being on auto pilot, impervious to change. But I do not see much change in his approach except to add more taxpayer dollars.
While it is likely that the benefits of shifting costs from the public sector to the private do not, by and large, include reducing overall costs of health care, benefits might be found elsewhere than in overall cost savings.
France, often cited as the best health system, combines public and private financing. Taxpayers pay the bill up to just over 70 per cent of overall costs. Then it becomes optional whether further insurance is required. About 90 per cent of French employees choose additional coverage through not-for-profit mutuelles, which normally adds about 20 per cent, leaving 10 per cent or less financed out of individual pockets.
Can a private and public mix respond to the need for equity, namely that everyone should have access to diagnosis and the best treatment in a timely way? Clearly, no one should take a back seat to wealth when their lives are at stake. But, for example, a knee or hip replacement falls into a category where in my view, if someone is prepared to pay for accelerated treatment, so be it.
Or should there be a parallel system for those who can and wish to spend their savings on health, and in so doing take pressure off the public system and the waiting lists for treatment? Some systems, Australia and Germany, function in that manner.
Is there a best-practice system somewhere that we all should follow? Probably not, but we should certainly establish what works and what does not and try to pick the best out of each system. If that means revising the framework put forward in the Canada Health Act, we should not be afraid of doing so. After all, health-care systems need to evolve over time based on international experiences and changing conditions. This can be achieved only through avoiding doctrinaire approaches and focusing on the well-being of all its users.
Photos taken during the event
The 2007 keynote speaker, the Honourable Donald J. Johnston, with Mr. Adrien D. Pouliot, sponsor of the Jean A. Pouliot Lecture Series.
The President of the MEI, Mr. Paul Daniel Muller.
Madam Hélène Desmarais, Chairman of the board of the MEI.
Mr. Pouliot introducing the keynote speaker.
The Honourable Donald J. Johnston.
The complete works of Adam Smith was give to Mr. Pouliot that evening.
Photos: Claudio Calligaris