Canada’s Three Tiered Healthcare System

Thanks to Premier Danny Williams’ comments, we are in another short bout of collective denial and misunderstanding of Canada’s healthcare system and the public perception thereof.

1. Denial.

For those not in the know, Premier Williams recently jaunted down to Miami for heart surgery. In his interview with NTV reporter Fred Hutton, he stated, “This is my heart. It’s my health and it’s my choice.” True. It is a choice. If you can afford it.

It’s also a wonderful reflection of the fact that despite all the mythology awe, in Canada, actually have a three-tiered healthcare system. Williams enjoys the benefit of tier three – travel to the US. It’s a choice that many, many wealthy Canadians make. Indeed, it’s a choice other wealthy politicians have made, including former Quebec premier Robert Bourassa and former MP Belinda Stronach. I’m willing to bet that the Mayo Clinic has made a lot of money off wealthy Canadians.

Of course, this effect is largely ignored since most Canadians can’t afford to go to the US. So we pretend it doesn’t happen. Indeed, the 1998 Katz paper, a frequently cited paper that claims Canadians don’t travel to the US for healthcare, strikes me as deeply misleading. As the study states:

An important limitation of this study is that only public out-of-country expenditures are included in the analysis; private sources of funding, including “travel” health insurance plans and out-of-pocket payments, are omitted.

This of course doesn’t prevent them from drawing some very strong conclusions, namely that Canadians don’t go to the US for healthcare. In some ways they are right, average Canadians don’t, but what did you expect if the  study only looks at people who used Ontario public insurance – in short, those who couldn’t afford to travel to the US and pay privately…

Then of course, there is the more familiar second tier. This is private healthcare available here in Canada. Don’t be fooled, there is plenty of private healthcare in Canada. Indeed, at least 30% of healthcare spending in Canada is from private funds. This includes simple things like your glasses and dental costs, as well as the more complex, such as clinics that conduct surgery in Quebec (which the Feds don’t dare close) to those in British Columbia (which most people pretend don’t exist). These service upper middle class Canadians and, ironically, provincial Workers Compensation Boards which are not bound by the Canada Health Act and so can pay to have their patients serviced by private clinics in Canada. Irony!

Finally, there is familiar tier one — the public system that most of us avail ourselves of. (Which still has a huge private component – all those doctor offices are private businesses…) The system generally works, but often has too few doctors (try finding a GP – 4.5 Million of us haven’t!), long wait lines in Emergency Rooms (often hours long) and waiting lists for some procedures (don’t break your hip).

This is the reality of healthcare in Canada. Yes, we have universal healthcare. But it is within a three-tiered system and the wealthy – like Danny Williams – opted out a long, long time ago.

2. (Mis)perceptions of Canadian (Mis)perceptions

Of course, many Canadians know that the wealthy go elsewhere. They even know that their healthcare system is either groaning or breaking (try being on a waiting list) or financially unsustainable (try living in a province where healthcare eats up 45% of the budget and rising). Moreover, they know more money isn’t going to magically solve it (or at least not the amount of money we can afford). Did anyone really believe that $41 billion over 10 years would “save healthcare for a generation?”

(As an aside, I suspect this is why Canadians reject the Liberals’ National Daycare Program – many people agree daycare is good and important but they remain suspicious of a system that is likely to become as top-down, hard to contain and even more difficult to reform/evolve as Healthcare. In short, they don’t wanted it modeled after I system they already think is borked.)

But the story isn’t that Canadians want either the status quo or the American option. Although Canadians recognize our system has huge challenges, most of us agree the American system is far, far worse, particularly for the vast majority of us who can’t afford to fly down there to begin with. Far better to stick with the devil we know, than the bogey man to the south. The fact is… better the system you know and hate, then the one you don’t know and hate even more.

Ultimately, both the Canadian and the American models are likely done. Neither country can afford to manage double digit (or even high single digit) increases in healthcare costs. Somewhere, something has to give. But we’ll have to experience a lot more pain (and denial about how great our system is) before we get there. What I suspect is true is that the wealthy and privileged stopped caring a long time ago. They aren’t invested in the system because – residing in the third tier – they are outside of it.

11 thoughts on “Canada’s Three Tiered Healthcare System

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  2. David Humphrey

    I think there's at least one more tier, or perhaps it's the upper portion of tier one–there are people who know people and know how to get things done. You can get a lot done if you know the right people in tier one. You can get the right referrals, you can get slotted in for surgeries, and you can access the right resources, drugs, and other benefits. But you have to know the right people. And, you have to know how to work the system. In other words, you need to be well educated, confident, savvy, networked. I think we sometimes forget that all health care in Canada is private…just some of it is publicly funded.

  3. meznor

    I've personally never had a problem witho our healthcare system… but I'm young and generally healthy. I don't currently have a doctor, and I briefly tried to find one only to discover most doctors don't accept new patients. So I rely on walk-in clinics the rare times I get sick or need medication. But what's the solution for an aging population that continues to threaten to burden the system?I think three things can start solving our impending healthcare crisis.- Better public awareness/education campaigns to take control of your own health – DIY healthcare, so to speak. Ontario did a good job distributing information about H1N1 and ensuring the public did simple things like wash their hands, stay home if they had flu symptoms, and get vaccinated if they were in a high-risk category. More campaigns like that for other preventable illnesses with simple, easy to follow advice would go a long way to prevent line-ups at the emergency room for things that could be treated or prevented from home. – Trust our nurses to provide perscriptions for common medications (e.g., birth control). Again, reduce waiting times for people who are going to the clinic or doctor for refills or other meds they can only currently get from a doctor. – Digitization of health care records, and modernization, in general, by healthcare professionals offering advice, blogs, wikis, etc. on DIY-Healthcare topics. Integrate this into school curriculum somehow – maybe a topic in Health class – and teach kids when they're young to be more in touch with their bodies and health. We need a sort of holistic approach here where health isn't just something you get from a hospital or clinic or even doctor.

  4. Dave Macdonald

    I don't believe that our health care system can be complete without a proactive component. The tiers captured in the blog, and even David's comments, will always exist (even to the extent that the US has elements of public health care in pockets hidden away), but we can't afford for health care to be reactive ALL the time. We'll never keep up with those costs if we can't respect our own bodies and maintain a growing population that includes generations that age more than its predecessor. People will smoke, people will drink, they'll get obese, etc. so long as health care is just passively outsourced and wholly relied upon when there's an acute issue.Melissa captured parts of a DIY system, but her third component about education can be blown up to actually drive people to own the responsibility for their health in some way. I really want others to be able to own their health to save me money, but I'm not sure what the incentive is to make me want to entirely own mine when I've got a system that I can trust to be there all the time just in case… it's a mess to say the least.

  5. christopher

    David, I'm surprised you didn't get more comments on this post :)With respect to how any single country's health-care system works, the 'third' tier is a bit of a red herring. If you're sufficiently “wealthy and privileged,” there will always be a third tier as long as there's for-profit health care anywhere on earth.I agree that our system has many problems and that Canadians' perceptions of our own system are skewed by the disastrous US system, but I'm not sure that ours is “done” (though I may have misunderstood what you mean by that). For all its problems, it appears to me to be intensely popular and I suspect that if services are too far restricted, people may find that they're willing to fight–or even pay more–to keep them. That said, recent history suggests I may be wrong…But what I'm more interested in is your mention of the “wealthy and privileged” and the various commenters' mentions of the idea that individuals must take responsibility for their own health. To some extent, this is reasonable, but there's a bigger public health issue that dwarfs the contributions that individuals can make to their own health and which, if properly addressed, could dramatically reduce the costs of our health care system.The problem is that, quite apart from their access to the third tier, the wealthy and privileged are healthier than we are. Social inequalities result in reliably worse health. The effect of social inequality on health is huge–one Canadian researcher has compared the reduction in mortality resulting from the elimination of the “social gradient in health” to curing *all* forms of cancer. It's obvious enough that social inequality can't be completely eliminated, but the point is that investment in areas seemingly as far removed from health care as public transit, city planning, agricultural subsidies–and day care (not meant as an endorsement of any particular plan!)–can have large effects on the health of the population and therefore on the affordability of health care. (CCPA page about inequality and health) (WHO's social determinants of health pages)PS: is this the new big-print version of your blog?

  6. beyondnormal

    I think the real message in the US and Canadian health care debate is Govt doesn't 'solve' problems, it just changes the problem. Politicians have some grandiose idea they can control human behavior, and (un)fortunately they are very deluded in this.The most inane thought of all is that getting Govt involved will control costs. How many times do we have to prove this is absolutely false, not to mention illogical, to stop believing this concept. How can adding another layer of control ever reduce cost? Adding anything will always increase cost to the end user – the only thing it does is create more jobs (with little to no real value added) for someone to do.

  7. Dave Macdonald

    Christopher, you are bang-on when it comes to noting that the wealthy are typically healthier. They can invest in their health with less time and creativity on account of having more money. It's a systemic issue that really does involve those far removed investments, but it can also be tied to the cheapest foods. One thing that Michael Pollan has done, despite some of his more controversial points, is show that the cheapest and most convenient foods are typically not the healthiest. If you've ever walked around the Greater Vancouver Food Bank, you'd see that things there aren't going to nourish people so much as feed them.It's an unfortunate problem, but it's also pretty interesting.

  8. Jacqueline Drake

    Until we know all the dark secrets hidden in the many pages of Health Care I don't want any part of it. Already due to the high cost of Health Care, I and many others on Social Security have lost some of our monthly income. What next?? I just heard that in 36 months we will be asked to accept a chip in our arm. Many Christians will refuse that. At least I know I will.

  9. Jacqueline Drake

    Until we know all the dark secrets hidden in the many pages of Health Care I don't want any part of it. Already due to the high cost of Health Care, I and many others on Social Security have lost some of our monthly income. What next?? I just heard that in 36 months we will be asked to accept a chip in our arm. Many Christians will refuse that. At least I know I will.

  10. john fort

    The only reason Canadians are stuck with a pathetic welfare health care system is because the average voter supports collectivism. All universality means is, ‘ I don’t want any fellow citizen to have better health care (than I have) even if it costs me dearly’. It is politics of envy not logic.

  11. Tim

    I’ve read through the comments left so far and I don’t see any mention of what I think anyway is the elephant in the room:  the rich are getting way richer (es[ecially the super-rich) and the poor poorer.  If you tax the rich fairly (according to their means using a progressive tax-structure) and ensure we diversify our economy to keep wealth inside the country and charge a fair price for private companies to extract our resources, we can have PLENTY of money to fund a universal, high-quality and accessible health care system that’s better than we have now.

    The country of Norway (which is a capitalist social democratic nation) has about 500 billion dollars stashed away in a rainy day fund.  The money from this came from the profits they made off their oil and gas industry.  They fund their social programs using the INTEREST they make off of their rainy day fund, including their health care system.

    Without going on and on, I would encourage everyone interested in the subject to consider how we could expect to continue to fund a health care system that will continue to be more and more expensive because of an aging population (provided there are no efficiencies made) if we continue to fall short in how we tax and save.

    For me, I believe it can be done better without having to compromise and continue to go down the slope of further privatization.  For me, the goal should be the opposite:  tax the rich more, use the money for things people want like access to quality healthcare and eliminate the need for private healthcare delivery (meaning making all necessary dental, optical, etc.  treatments publicly financed and provided).


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