Socialized Medicine Cuts Canada’s Costs--and Care

Billboards on the riverfront drive in Windsor demand to know “how many more” will die under Canada’s vaunted health care system. Ads in the newspapers have been urging citizens to rally for reforms.

And rally they did on a recent bone-chilling morning, calling for changes in a national health plan under scrutiny as a possible model for the United States.

“We don’t want our people dying anymore,” said protester Vicki Bondy, a volunteer with Heartbeat Windsor, a group that helps Canadians find hospital beds in the United States when they cannot get them at home.

The rally was organized to protest the death of Bondy’s nephew, 2-year-old Joel Bondy, who needed heart surgery but never got it. Joel’s death in February offers a window on Canadian health care at its worst: Compared to the United States, there is a relative paucity of high-tech health centers here--and, as a result, hundreds of Canadians who need complex treatment ranging from heart surgery to organ transplants spend months on waiting lists. Each year, some Canadians die while they wait.

But the rally that marked Joel Bondy’s death underscored another aspect of the Canadian system, something that should be of interest to Americans seeking models for change: Even as the marchers deplored the Canadian system’s downfalls, they were quick to say that it was better than the American way.

“I wouldn’t trade our system for anything in the world,” said Andrew Williams, a 32-year-old Windsor resident who needed a triple-bypass operation last year, waited in vain for 3 1/2 months, then finally gave up and left Ontario province for nearby Detroit. “But changing demographics have put strains on this system.”

Canada established universal health insurance coverage in 1971, although some provinces had set up narrower programs of their own even earlier. In designing its brand of socialized medicine, Canada did not go nearly as far as Britain, which nationalized hospitals and made doctors government employees. It merely outlawed private health insurance for virtually all forms of care and enrolled citizens in government plans administered by the 10 provinces.

Every Canadian citizen is thus guaranteed access to a doctor at no direct cost. He can see any practitioner he pleases. He goes in and out of the hospital, in most cases, without ever touching his wallet.

“It doesn’t matter how rich or poor you are, what color you are or what side of town you live on,” said Williams, marching with his sisters just across the Detroit River from Detroit. “If your child is sick, you can walk into a doctor’s office anywhere in Ontario, with no money in your pocket.”

Over the years, universal health insurance has evolved into Canada’s most popular social program. Data compiled by the Families USA Foundation in Washington show that 7 out of 10 Canadians think their system gives them good or excellent care; 9 out of 10 say the health care system here is “one of the things that makes Canada the best country in the world in which to live.”

When asked in casual conversation to tick off the differences between their country and the United States, Canadians almost invariably mention universal health insurance as evidence that Canada is the more civilized place.

Since primary care is available at no cost, Canadians do not hesitate to see their doctors. Indeed, this is probably one reason Canadians are so healthy. Canadian infant mortality, a key measure of a nation’s public health, was 9.6 per 1,000 births in 1981, compared to the American rate of 12.6 per 1,000.

And not only that: At the same time that Canada provides no-charge treatment for all, it has managed to hold down costs. Before Canada had established its universal health insurance system, it spent about as much as the United States did on health care (7.4% of its gross national product, compared to 7.6% in the United States).

Since 1971, however, the two countries’ rates of spending have diverged, so that Canada now spends less than 9% while America spends nearly 12% of its gross national product on health.

It is this aspect of Canada’s system that has caught the eye of U.S. lawmakers, corporate executives and union leaders. For the last 10 years in America, health care costs have been rising faster than inflation; now, they are rising faster than any other part of the U.S. economy.

Corporate America foots most of the bill, but insurance premiums have been shooting up so fast that a major cost of doing business today has become the cost of employee health insurance. Worker health care now adds about $700 to the cost of an American car; in Canada, it is believed to add only $223.

When U.S. employers have tried to cut back on coverage, labor unrest has resulted.

“In most of the strikes that have occurred in the last few years, health care has been the major issue,” said Rod Rogers, a spokesman for the Oil, Chemical and Atomic Workers Union.

At non-union businesses, meanwhile, some employers have simply dropped coverage altogether. An estimated 37 million Americans are without health insurance today, including a growing number of middle-income people. Philip Shandler, a spokesman for the U.S. Bipartisan Commission on Comprehensive Health Care, says the population of uninsured Americans is growing by 1 million a year.

The commission spent two years studying ways of reforming the American health care system and in early March issued a number of recommendations. One was for a “public-private partnership” that would offer some new government health insurance assistance but at the same time call on more private businesses to cover their workers. Lawmakers are now considering ways to write the recommendations into law.

Shandler said the commission considered handing over full responsibility to the government, Canadian-style, but decided that it would be too hard to legislate such a shift because of “opposition from health care providers, doctors in particular.”

Canadian doctors bitterly fought enactment of their universal health care system, but today they seem happy that they lost the battle.

“It’s much more comfortable for doctors” in Canada, said Allan Detsky, a doctor and economist who studied in the United States and who now heads the internal medicine department at Toronto General Hospital.

In Canada, he pointed out, doctors may not be able to charge as much as they could in the United States--but they don’t have to worry about collecting bills or arguing with increasingly hard-nosed insurance companies over reimbursement.

It turns out that by eliminating all the paper work and dickering, Canada has not only pleased its doctors but also helped hold down costs. Because paper work is dramatically simplified--all bills go straight to the government--it is estimated that Canadians spend less than $20 per capita each year on the flow of forms.

Americans, by contrast, spend $95 each on insurance overhead. It has been estimated that if the United States were to cut out the paper work the way Canada has, the system could save $21.4 billion a year.

But there is another way Canada holds down its health care costs, and it is a lot less attractive: It deliberately limits the spread of the newest, most advanced health care technology. Canada may go in for primary medicine in a big way--its medical schools turn out far more general practitioners and pediatricians than their U.S. counterparts--but it scrimps on the specializations.

When hospitals here want magnetic resonance imaging equipment, lithotriptors to treat kidney stones and other big-ticket innovations, they must include the purchase cost in their annual budget proposals to the provincial government. If the province rejects the budget, the hospital cannot buy the equipment.

Admirers of the Canadian approach say it saves money by encouraging basic health care, cutting out duplicative technology and, most likely, reducing unnecessary surgery.

Still, detractors of the Canadian system say it was the restrained approach to high technology that brought the Bondy family to grief. The Bondys’ hometown, Windsor, has a population of about 300,000 but it has no specialized cardiac surgery unit. Detroit, meanwhile, has nine. In all of Canada, it turns out, there are only 11 heart surgery units; the United States has 793.

Joel Bondy’s aunt Vicki, who has become a spokeswoman for the family, said the child was born with arteries too small to supply oxygen to his body. He had surgery when he was 3 months old, but it was not effective, and his parents were told that he needed another operation. Because Windsor does not have the facilities, Joel’s parents put him on a waiting list for surgery in London, Ontario, a two-hour drive away.

There are no clear statistics available on average waiting times for high-tech treatments in Canada, but doctors say it is commonplace for a patient to languish for three to six months before a heart operation, a bed in a cancer center, a hip replacement or some other highly specialized treatment.

While the patients wait, their doctors act as their intermediaries with the specialized units. In Joel’s case, surgery was first scheduled for late February, but as the date approached, more urgent patients were moved ahead of him. He was bumped back to mid-March.

Joel’s anguished parents complained to the local news media, and Heartbeat Windsor took up the case.

The group’s director, Michael Billett, who is known locally as “the Detroit connection,” arranged for the child to have surgery across the river in the United States. But before Joel could make it over the bridge, Canadian officials, deeply embarrassed by the affair, announced that they had found a bed for him after all. They urged the Bondys to have the surgery done in Toronto, and the Bondys relented. They made the trip to Toronto, but it was too late.

“They finally got him in, and he died four hours before surgery was to have been performed,” his aunt said.

Word of the toddler’s death shocked Windsor, where seemingly everybody knew about Joel and was rooting for him. Then word leaked out that the Ontario government had already forked over about $5 million to the hospitals of Detroit to pay the hospital bills of other sick Canadians.

Why, citizens wondered, hadn’t those tax dollars been spent building a heart unit in Windsor?

“It’s the first time I’ve ever seen an entire city mourn,” said Vicki Bondy as she surveyed the crowds who came to the march the first weekend in April.