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					                                                           The Health Care Blog

POLICY: Oh Canada!

First published on Tuesday November 11, 2003

This article is about Canada's health system and its relationship to the US health policy
debate. It is not meant to be an endorsement of Canada's system, or an endorsement of
single payer for the US. From my personal point of view, while I think serious health care
reform is unlikely in the next few years in the US, some foreign models of health
insurance are very useful for the US debate. But the combined local/employer insurance
systems seen in Japan, Germany and Holland provide a more likely and familiar model
for the US, than the Canadian or UK single-payer systems. However, this article isn't
about what might happen here or which system is better. This article is about the
distortions that are frequently heard in the US, and in Canada for that matter, about the
Canadian system. It's also a lot longer than the average post, such as my recent post on
Canada, Steffi and Ken, and you can download it as a separate document here if you want
to print it out and savor/criticize it over a cup of coffee.

This article is dedicated to the amazing Medpundit. Despite the fact that I disagree with a
huge percentage of what she says, Sydney Smith manages to cover virtually all of health
care and medicine in her excellent blog, while writing book reviews, keeping up a full
time solo family practice, and claiming that she's not posting as much as she used to. Her
article on Canadian physician emigration and the vigorous support she got from her
commenters finally got me to get off the dime and put in my several cents worth.

Before I jump into this it's worth noting that some of the differences between these health
care systems are cultural. There have been several interesting descriptions of the
international variations in medical practices. In one great book written in the 1980s, The
Painful Prescription, Aaron and Schwartz describe rationing of hospital care in Europe
and the UK compared to the US. For instance they pointed out that in the UK kidney
dialysis was not used at nearly the levels among the elderly as it was in the US (or in fact
in Europe). So they concluded that care was rationed and as a direct consequence people
died. (If you have ESRD and don't get treatment eventually your kidneys shut down and
you die). However, many other commentators, including Lynn Payer in her book
Medicine and Culture which is very well described by Humphrey Taylor from Harris,
have shown fairly conclusively that many cultures just regard "care" in a different way. In
that sense the dialysis-use figures could be seen as the aggrandizement of hundreds of
decisions not to over-tax elderly patients with a long and difficult treatment that wouldn't
help their quality of life, even as it extended it slightly. Indeed, it's equally cultural
relative to accuse Americans of "over-care" by doing CABGs on 95 year olds who are
soon going to die anyway. So while you're reading the rest of this article you need to bear
in mind that some of the differences that are ascribed to policy are due to culture. Having
said that; many are not.
 Oh Canada!

Before we start, recall that Canada has a single payer in each province that provides
uniform health insurance to all its citizens. To provide that care it contracts directly and
exclusively with physicians and hospitals, who remain largely autonomous but have no
other customers. The US in contrast has a mixed-private-public system for which the
government provides about half the money. Insurance is only universal for those over 65,
and roughly 14% of the population has no insurance coverage, with very varying levels
of coverage for the rest--mostly coming through employers. The latest comparable
numbers have the US spending roughly 14% of GDP on health care while that number is
around 11% in Canada. So at a macro level, the Canadians pay less as a share of their
income to cover more of their people. (In fact as its GDP per capita is lower than
America's Canada spends considerably less per citizen). While single-payer advocates
tout those numbers, many critics claim that Canada rations care, and that both patients
and physicians are leaving Canada to give and receive care that's not available at home.

Given that, it's worth looking at two main aspects of the Canadian system that frequently
come up for criticism. How are patients doing? What's going on with physicians? And are
they really all leaving the Great White North to escape its health care system?

The Patient Experience

It's simplistic and true to say that Canadians have free access to basic health care.
Americans have varied access based mostly on insurance. And it's accepted that, as a
corollary, all Canadians have less access to high-technology health care than do most
Americans, However, googling around the web you'll find indications that 18% of
Canadians cannot get access to first contact care, (although only 10% have had trouble
getting routine day time care). Still even 10% lacking access to care isn't nothing,
especially in a universal insurance system. Luckily the Commonwealth Fund has over
the years funded my old colleagues at Harris and Harvard, led by Bob Blendon, to do
several studies over the years about these issues. They asked consumers' views in several
countries, but we'll concentrate on Canada and the US. (Note: When you open a link that
is a PowerPoint slide, hit the page down button as there might be 2 or 3 slides in that one

System satisfaction: Canadians were very happy with their system in the late 1980s but
were much less happy by 1998 and also in 2001, after a period of funding reduction. But
they are still happier than Americans, or at least only 18% want to completely rebuild the
system, as opposed to over 28% of Americans. (The 2003 American number is over 30%-
-I don't have the latest Canadian numbers, but they have been spending increasingly more
and their incoming PM has promised to maintain that level. So as satisfaction went down
due to less money you can expect that level to increase when there's more. It's also worth
noting that the Canadians saved the rest of their economy some money, while during the
large boom in the US in the 1990s, the health care sector stayed steady as a share of GDP.

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 Oh Canada!

Access to care: In terms of actually getting care and accessing doctors, both Americans
and Canadians felt access was about the same. But in terms of access to care, by 2001
26% of Canadians thought it was getting worse, and only 6% getting better. 20% of
Americans thought their access was getting worse too, but 17% thought it was getting

But then we get to some of the key issues. In Canada for elective surgery you have to
wait; two thirds of Americans can get it within a month. Most Canadians have to wait
more than a month and more than 25% have waited more than 4 months. No one waits
that long in the US (presumably so long as they can qualify for coverage).

Costs matter: But in the US costs really matter. Over a quarter of Americans had out-of-
pocket costs of over $1,000, compared to less than 5% of Canadians. Americans were
two to five times more likely than Canadians to have an access problem due to cost, such
as not getting a needed drug or not seeing a doctor. And when you look at those with
below average incomes, in Canada only 9% failed to get recommended follow up care
due to cost. In the US, over one third did not. More than a quarter of Americans (26%)--
including 39% of those with below average incomes--didn't fill a prescription because of
costs, more than twice the number than in Canada. 21% of Americans have problems
paying medical bills compared to only 5% in Canada, and that goes for 35% of
Americans with below average incomes. So on a macro level it's true that nationally
Canadians sacrifice getting access to expensive resources (such as MRIs and surgeons).
But in turn they don't have to put up with the individual cost issues that are a problem for
many Americans, especially the poorer ones.

If you look at the same type of indicators amongst those who are sick in similar study
(also from Blendon's group) they are virtually all the same, with problems of access to
specialty care and hospitals in Canada matched by access problems due to cost being 2-3
times worse for the sick in the US. Here are the sources for the full charts for the
“healthys” and the sick.

The impatient inpatient: This is where the arguments get anecdotal, and little ridiculous.
I never understand, for instance, why American small business owners who have to buy
insurance in the world's most dysfunctional market complain so much about the prospect
of Canadian-style health care. In 1993 I talked to a Rotary Club where, before I even got
my international comparisons slide out, the small business owners in the room came after
me with the classic anti-Canadian argument that goes something like "When he needed
care the Prime Minister of Alberta/Nova Scotia/Yukon Territory/Canada came down to
the US". There has always been an extremely limited number of Canadians getting new
high-tech care in the US that isn't available in Canada, almost always paid for by their
province. However this has been transposed into the argument that thousands of
Canadians are flooding across the border to get care that is unavailable at home. There is
even the very occasional and under-filled patient bus trip coming down to get

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 Oh Canada!

prescriptions and treatments unavailable in Canada, of course massively outnumbered by
the buses taking Americans to buy cheaper drugs up north.

While the argument about Canadians flooding south to get medical care withheld from
them up north is widely heard, it's bullshit. Yup, lots of Canadians get care in the US, but
that's because, due to the better weather, the higher incomes, going to college or that
NAFTA thing, they either live here, or are on vacation in Florida to escape that terrible
winter. Work done by a team led by Steve Katz at University of Michigan with the
Evans/Barer/Cardiff team at UBC which looked into this in obsessive detail found
essentially no evidence of Canadians crossing the border to get care. (Incidentally plenty
of Americans are still going up there for non-covered surgery like laser corrective eye
surgery, which is cheaper and just as good up north). In fact according to Canadian
insurers there appears to be no interest amongst Canadian consumers in commercial
insurance products to cover care abroad, other than standard holiday cover. Note that this
is not the case in the UK, where private insurance allows about 10% of Brits to jump the
queue to get surgery in a private hospital. So it looks like the Canadians accept the fact
that they have to wait for surgery, and not surprisingly don't want to come down here to
pay for it out of pocket.

The Grumpy Doctors

As mentioned earlier, I started working on this article partly because Sydney Smith over
at Medpundit wrote a piece saying essentially that Canadian doctors felt that their system
sucked, they all wanted to move to the US and that many of them already had--leading to
a doctor shortage in Canada. She concluded:

       And why are Canadian physicians leaving their patients in the lurch? Not for the
       money. They leave for better research opportunities, for greater professional and
       clinical autonomy, better job choices, and better medical facilities. They leave, in
       other words, for all the advantages conferred by a free-market healthcare system-
       -the same advantages that we American physicians take for granted when we
       yearn for a Canadian-style system. We should look to Canada, all right, but not
       as a role model. We should look to them instead as a warning. There but for the
       grace of God--and a strong independent streak--go we.

Before we look more at the emigration factor, again it's worth looking at a relatively
recent study by the Harvard team. In 2000 they asked a set of questions to doctors in the
same five (English-speaking nations) nations where they surveyed patients in 1998 and
2001. It was indeed true that doctors in Canada were pretty miserable, and you certainly
can trawl the Internet and easily find grumpy Canadian doctors, and many anecdotal
stories of them leaving for the good life in the US. In the Harvard study, Canadian
doctors did believe that their ability to provide quality care had got worse in the last five
years, but only slightly more Canadian doctors believed this (59% v 56% for generalists
and 67% v 60% for specialists) than did Americans. And Canadians were only slightly

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 Oh Canada!

more pessimistic that the quality of care would decline (61% v 54%) in the future. But
when asked about major problems in their practice, compared to Americans they were
one-third less likely to regard external review of clinical decisions to control costs as a
problem (13% v 36%), and less than one-half as likely to see limitations on drugs they
could prescribe (18% v 43%), or to be concerned that their patients couldn't afford
necessary prescription drugs (17% v 48%). These of course are the typical hassles that
make up the drudgery of a physician's daily practice. The real concerns of Canadian
physicians compared to Americans were, of course, limitations on specialist referrals
(66% v 29%) and access to hospital care (64% v 8%) for their patients.

Then things get really interesting. When asked, more directly if their actual patients often
lacked access to newest drugs or medical technology only 26% of Canadian doctors said
so--roughly the same as the 27% of Americans. And when asked if their patients get
sicker because they are not able to get the health care they need, instead of the high
numbers you might expect, only 12% of Canadian doctors said so, as opposed to 18% of
Americans. So it appears that Canadian physicians think that by and large that Canadian
patients do actually get the care they need, or if they don't, it seems not to impact their

Then when asked about their satisfaction with their own practice 72% were very or
somewhat satisfied compared to 68% of Americans. And when you ask the classic three
Harris questions about satisfaction with the system and the need for reform, Canadian
docs are much less likely to want "complete rebuilding" (4% vs 12%), and similarly
much more likely (25% vs 16%) to think that their system "works well." Here is the full
physician chart set.

There's no question that Canadian doctors are less happy than they were, but that's more
to do with the funding (and pay) cuts they saw over the previous decade (which were a
symptom of the Canadian government getting its health care spending under control) than
anything fundamentally wrong with the system.

The dissatisfied disappearing physician: But what about all those Canadian doctors
fleeing the country? Well let's first look at why they are fleeing. There are several
Canadian researchers or specialists in the US taking advantage of bigger budgets for their
research, or training in something Canada leaves to its bigger, richer neighbor. A 1994
survey of Canadian physicians living in the United States found that postgraduate training
in the United States was associated with subsequent emigration--in other words they went
there, they liked it and stayed or went back later. Other reasons for staying in the US
included professional/clinical autonomy, availability of medical facilities and jobs, and
remuneration, although this last factor was curiously considered equally important by
Canada-based docs as a reason for staying behind. (They clearly hadn't asked their émigré
colleagues what they were making!)

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 Oh Canada!

Now we're starting to get somewhere. Just as Canada takes advantage of America's over
abundance of facilities to buy high-tech services for its patients on the margin (usually
before it later adopts them in its own facilities) it also does the same for doctors who
want to work in highly-specialized cutting edge technology areas. As in many other
industries, the opportunities to do the coolest stuff tend to be here in the States. For an
example, look to this somewhat tongue-in-cheek debate between Robert Califf, a Duke
cardiologist and a Canadian colleague David Naylor, which asked if American cardiac
care is better than Canadian care?

By now you know the answer. If as a patient or a cardiologist you make it to Duke (or
another high-end American institution), you find quicker access to more expensive

       Califf noted that Americans experienced "differences in mortality over time
       largely because of the difference in the rate of revascularization between the
       countries" Conversely, "simply stated, for people with heart disease, the US
       offers greater access, better technology, and greater creativity in solving clinical
       problems," Califf said. "There's no question when you look at the systems, the US
       has better access to cardiologists, better access to technology-not because as
       cardiologists you're not smart enough to use it, you're just not allowed to use it
       when you want to-and very rapid access to new technologies."

But then he admitted some more interesting nuggets:

       “Yes, we cost more to the patient, and we have problems with prescription drugs,
       but in the category of respect for cardiovascular practitioners, there's no question
       who gets more respect, and if you want to make more money, just move south”.

His debating partner, Dr David Naylor responded that:

       Revascularization may provide a mortality advantage. From a broader
       population perspective, though, these differences are unlikely to change the fact
       that in overall survival after the age of 65, Canadians come out ahead of the US.
       "The US does of course come out ahead in what is spent," he added, roughly
       double that spent in Canada on care of the elderly.

In the last part of what was a pretty funny debate for a bunch of dry heart docs, Califf got
rather serious and actually came over as a fan of the Canadian system but felt that it just
needed more money:

       “I would submit that the US is going to have to become more like Canada in
       terms of its healthcare system, because there's no other solution in sight, but I
       would also submit that if you don't ratchet up your expenditures on healthcare

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 Oh Canada!

       with the demographic that you and we share, you're going to be facing an even
       more explosive situation than you currently have”

However part of what he said in jest is true. It is logical for Canadian doctors who need
no additional qualifications to work in the US to go south for another reason. It pays
better; much better! Canadian physician incomes averaged about C$135,000, and even
surgical specialists get only about C$180,000. In the US specialists in groups averaged
somewhere between $150,000 and $350,000, primary care around $150,000--and don't
forget that Canadian dollars are worth 1/3 less than their American namesakes! In fact
this chart of international physician incomes shows that virtually any doctor would be
better off moving to the US. (Actually FYI Japanese doctors make more than
Americans). So when Medpundit says that Canadian doctors are coming here in droves,
you can't exactly blame them. Only one little thing is a bit strange; they are not!

The brave folks from UBC led again by my old colleagues Morris Barer and Bob Evans,
as reported in this issue brief called The myth of Canadian physician emigration, show
that although roughly 500 doctors a year are leaving to the US, somewhere between 250
and 300 were coming back the other way, and that the deficit was more than made up of
other doctors immigrating to Canada--mostly Brits who thought that Canadian pay scales
were pretty good compared to what they got at home! Even at its greatest extent Canada
was losing 1.4% gross of its physicians and more than making it up through returning
Canadians and importing foreigners. And even though Canada has fewer docs per head
than the US (2.1 per 1,000 v 2.6) it has more than the UK or Japan (1.7 & 1.6) so these
numbers are not significant either as a share of all doctors or proportionally to the
population. It is worth pointing out that the other 99% of Canadian doctors didn't believe
that doubling their salary was enough to compensate for the associated unpleasantness of
having to move to the US!

Conclusion: There are No Easy Answers

My primary objective in writing this piece is not to deride the good work done by those
on all sides of this issue. Instead it's to show that while looking at international
comparisons is valuable, it's not OK to look on the surface and ignore the many
complexities underneath that surface. Worse it's totally dishonest to take "facts" out of
context or tell blatant lies--but there's no tax on lying.

Health systems everywhere are under financial strain--always have been and always will
be. Canada certainly limits access to high technology and specialists by limiting
investment in them upstream. The US does not, but citizens living in Canada are very
unlikely to run into severe financial trouble because of their health--not so here.
Meanwhile, poorer Canadians have a roughly comparable experience with their medical
system as do other Canadians. Poor Americans certainly do not enjoy the benefits of
their system as much as their richer compatriots. You might also have a sneaking
suspicion that as their health system is more popular with Canadians than with their

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 Oh Canada!

doctors (while the opposite is true in the US) perhaps the Canadian system is actually run
in favor of the consumers rather than the producers of health care!

There are certainly cultural differences between Americans and Canadians, as Michael
Moore pointed out Bowling For Columbine. But there are also structural ones that are
creations of policy. We are heading into a period of policy discussion again, and
inevitably the Canadian system will come up in the conversation. It would be nice if that
conversation was based somewhat in reality.

Matthew Holt is a health care consultant living in San Francisco. He authors The Health
Care Blog, which can be found at www.thehealthcareblog.com, and can be reached at

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