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Sleeping with the Elephant
As the projector beamed a PowerPoint slide illustrating the US health care system's taxonomy of coverage schemes, an overlapping mosaic of magnificent convolution, Uwe Reinhardt took a moment to look back at the creation and marvel. "This slide is almost Italian in its artistry," he said, tongue planted firmly in cheek.
At times Reinhardt, a Princeton economist and eminent health care expert, sounded more Milton Berle than Milton Friedman as he delivered the 26th Osler Lecture in a crowded Palmer Amphitheatre in the McIntyre Medical Building November 6. But if his talk, "In Bed with the Elephant: Health Care and Social Solidarity in the Neighbourhood of the United States," was spiked with humour uncharacteristic of his by-the-numbers profession, his frequent injections of morality may have been even more remarkable.
"The last time I used this file the computer crashed," Reinhardt continued, "and I said it's symbolic, because the US health care system is crashing, too."
Actually, that depends on one's perspective. After all, Reinhardt said, "for the well insured, we have the most luxurious system in the world."
But there's no arguing the influence of the Darwinian US health care system north of its border. "Sleeping with the elephant was Trudeau's expression," Reinhardt said. "And it is a good one, because this is, in some regards, what is bedeviling the Canadian health care system."
Reinhardt claimed great admiration for the Canadian way of health: "You have this quaint belief that the health care of everyone, regardless of social class, should be valued equally. I think America should learn that lesson."
Instead, he said, health care in the US is viewed as a privilege, not a right, a social ethic that no legislator would dare put to ink. "If you believe, as many well-to-do Americans believe, that society is a meritocracy, then an egalitarian distribution of health care is unjust," Reinhardt said.
From this doctrine has sprung the multi-tiered US health care system: The government provides for basic health care to the poorest and the oldest. Employers provide private health insurance for the middle class. The wealthiest enjoy "boutique medicine" of the highest standard. But there is a fourth tier. Some 41 million citizens of the world's richest nation go without any health insurance -- most of whom fall into the category of working poor, the low-wage earners who keep the nation running.
By way of explaining the roots of this ethic, Reinhardt introduced the "Kindness Curve," which measures the cost versus frequency of kind acts (in this case, radiology treatment or a coronary bypass). When nice is cheap, as in the Canadian health care system, kind acts are performed all the time. When nice is expensive, as in the US system, the disincentive for kind acts takes a toll. "It's quite possible that we Americans intrinsically are just as kind as you Canadians," Reinhardt opined. "Our demand curve is the same. But the American supply curve sits so much higher that we have time for far fewer kind acts."
And though he believes that doctors and nurses deserve to be handsomely paid, "if you overpay for health care, you can price kindness out of a nation's soul."
Therein lay the caution. Canadians are increasingly calling for improvements to their health care experience. Newspapers report daily tales of woe from overcrowded hospital wards. Doctors and nurses are in short supply. Waits have become unacceptable. And the government is taking notice. The Romanow Commission on the Future of Health Care in Canada is investigating all the options, from increased government funding to the introduction of user fees and privatized choice.
"You don't have as much freedom of choice as you might think," Reinhardt warned. "The US is your worst rival because our nursing salaries, our physician incomes set the benchmark to which you must adapt. Or else we will steal your nurses and your doctors."
Mario Dumont, leader of the Action Démocratique party, believes the solution is privatization of a portion of health care. "I don't know how God made him," Reinhardt said, "but I have a feeling he took the DNA of John F. Kennedy and the mind of Ronald Reagan. He's very handsome, very seductive. But if his concept of a two-tier health system is not controlled, it can spread like a cancer through your system."
As for Dumont's claim of the greater efficiency of private markets? "Bullshine," Reinhardt said. "How well did Wall Street do at running telecommunications? Didn't you once have a company up here called Nortel? There's no empirical evidence, nor is it true on theoretical grounds, that private markets are more efficient in health care than government is."
Instead, to preserve the social ethic, Reinhardt prescribed funding the current health care system amply and running it efficiently ("A moral imperative," he said. "And you don't often hear economists talk about morality"). While the US health care system, comprising 13 percent of its gross domestic product, is massively inefficient, Reinhardt reasoned that a lean system at 10 or 10.5 percent of the GDP could treat its providers and its people right. Canada is currently at 9 percent. "Your Minister of Finance, John Manley, is dead wrong saying Canada will not raise taxes and put more money into health care. He doesn't understand health care," he said. "And it's too bad, because you're ruining a great system by strangling it."
If the nation does decide to explore privatization of health care, Reinhardt suggested it proceed "the way crocodiles make love: very carefully.
"You are still a kind people," he added. "But it could very well happen that your entrepreneurs, your Dumont and we in the south shift up your supply curve. And then you'll spend more money and be less kind. If you go further down the road that seems to be pointed to by Mr. Dumont, you will wind up ultimately like the US system --where 75 percent of the people have damn fine health care, and 25 percent at the bottom have terrible health care experience.
"If you prefer an egalitarian system, you have to fight for it. And you have to pay the piper."
Reinhardt closed with a moral to this story of an elephant and a beaver as strange bedfellows. "Being in bed with the elephant is only half of the problem," he concluded. "Having the creature walk all over you is worse. Then it will no longer be 'O Canada.' It will be 'Oy vey, Canada!' Once you're there, you can't go back."