Fyke report’s missing link: health-care allowances

Lawrence Solomon
National Post
April 17, 2001

Saskatchewan’s Commission on Medicare brutally described the country’s health-care system last week in its report, Sustaining a Quality System.

Our publicly funded system is dysfunctional, Commissioner Kenneth J. Fyke’s report explains time and again, killing and injuring us in large numbers through clinical errors – he suggests these may dwarf the toll taken by highway accidents – and failing us in numerous other ways. It is “a system unintentionally designed to produce an unacceptable degree of error and waste. The most talented and committed individual can neither overcome bad system design nor compensate for the absence of timely and comprehensive information.”

Mr. Fyke, whose career in the Canadian health bureaucracy spans 35 years, understands that ours is a politicized system that largely operates for the convenience of the various special interests involved – chiefly the government bureaucracy and the various health-care workers who “have focused on their own entitlements rather than their obligations.” The rigid system that results creates obsolete practices, bad morale, general frustration and impersonal care that’s dispensed on a volume basis with little regard to the patient’s actual needs. Needless work is routinely performed. “Essentially the system pays for activity and is indifferent to result,” the report states.

The U.S. health-care system may have problems, but “it is inconceivable that American health-care organizations pay less attention to quality and service than ours given their competitive insurance structure and their litigation-friendly jurisdiction. In fact, given that quality has more funding and champions in the United States than in Canada, it is likely that, if anything, our circumstances are worse.”

Under the status quo, our doctors poorly dispense drugs – as one example, adverse drug reactions account for 20% of elderly admissions to hospital – and they operate whether surgery is called for or not. Instead of using medical resources better, the health-care establishment insists it needs more money, and typically gets it. Yet more money, Mr. Fyke believes, is part of the problem: “Adding money without changing the culture of the system provides only temporary relief.”

The culture that Mr. Fyke sensibly wants for us is less paternalistic and more customer-oriented. He shudders at a system that “would frankly be an embarrassment in any other human service industry. Long waits, anonymity, isolation, embarrassment, confusion, non-response, physical discomfort and infantilization are all common characteristics of health-care settings from patients’ and families’ points of view.” Why does a consumer of an automobile have access to superb information, the report asks, while consumers of health services are kept in the dark?

The answer, of course, partly lies in the auto companies’ need to compete for our business, leading them to lavish us with information. More fundamentally, the availability of myriad choices in the types of cars we can purchase, and the manner in which they’re outfitted, creates an industry of independent information providers skilled at understanding the many niches in the auto marketplace, and at conveying information about those niches to those of us who seek it. If the automobile sector were managed as a giant monopolized utility by auto bureaucrats deciding what cars with which options we needed and when – if it operated as the health industry does – we would have no meaningful choices, giving us little reason to gather data and giving information providers little incentive to gather it for us.

But amazingly, Mr. Fyke does not see that the culture that he deplores will not change as long as the system operates as a monopoly, without competition to give customers choice. To span the information gap, he suggests more bureaucracy in the form of performance indicators, a redesigned annual report by Saskatchewan’s health ministry and another government body – a Quality Council – that would, among other tasks, issue report cards.

These recommendations turn an otherwise insightful report into so much paper. And yet an answer to our medicare woes does exist, one which Mr. Fyke entirely ignored, even though it meets his desire to maintain a publicly funded, one-tier system. The answer, which goes by the name of health-care allowances, would provide every Canadian, rich or poor, with an annual allowance equal to what he currently costs the system, plus an annual top-up. It has been analyzed for Canada by one of the world’s top health-care actuarial firms and confirms Mr. Fyke’s finding that a publicly financed health-care system can deliver quality at lower cost by finding the kind of efficiencies that excellent systems find. But even more, health-care allowances would solve many problems that Mr. Fyke identifies, such as how to provide free prescription drugs without bankrupting the medicare system.

The Fyke report may yet prove valuable, however. The person who commissioned it, Saskatchewan’s former premier, Roy Romanow, is now heading up a federal inquiry into medicare and he plans to use it as a building block. Good. Mr. Fyke’s diagnosis of the disease is excellent: It’s his prescription that’s wanting.

Mr. Romanow has his foundation in the Fyke report. To make for medicare a magnificent edifice, he should now direct his energy to the one medical instrument – health-care allowances – that can deliver the quality and meaningful choices that will allow medicare to fulfill the dream that Canadians have for it.

Why isn’t buying surgery like buying a car?

From Sustaining A Quality System, a report from Saskatchewan’s Commission on Medicare released April 11.

Emily Pelletier wants to buy a new car. Bill Kozak needs surgery. Both want the best possible information to answer their questions and enable them to make informed judgments and decisions. In Saskatchewan at the dawn of the millennium, what will their quest for information find?

Emily Pelletier, a savvy consumer who knows her way around the Internet, the library, and the newsstand, is in great shape. The specifications for the car – dimensions, features, engine size and power, fuel efficiency – are supplied by the manufacturer. There are numerous magazines, journals, and Web sites that publish independent comparative reviews of cars in the same class.

She can find out the dealer cost and the typical mark-up. She can consult buyers’ guides to find out how the car holds up over time, what components are most likely to break down, what repairs will cost, and the typical rate of depreciation. She can read real-time, up-to-date customer satisfaction survey information. And Emily’s car will come with a warranty that guarantees quality and service for a defined period of time.

Thirty years ago, Emily would have had a much more difficult time finding any of this information. Buying a car in those days was much more of a gamble. For such a major purchase, the public wanted reliable, comprehensive information to aid their decisions. As the information got better and easier to get, the auto industry transformed. In the 1980s, for example, it became clear that Japanese cars were better than American cars – mainly because of advanced design and manufacturing processes, and a commitment to quality. Millions of buyers bought Japanese cars as a result.

After surveying the wreckage of their market share, the American manufacturers responded by making better cars. Today almost every car is much better than the cars of twenty years ago. Quality improvement has been driven by consumer expectations and fuelled by sound evaluative data.

Now let us consider Bill Kozak, the patient about to undergo surgery. What information is available to him? Not very much. He probably knows little about his family physician – where she graduated, where she placed in her class, what type of continuing medical education she has pursued, even her main areas of interest. She may refer him to a specialist, whose characteristics are similarly unknown. How many procedures has the specialist done? What is the complication rate, and how does this compare to the peer group? Are there other specialists around and if so, why refer to one and not the others? How does the hospital compare to others in terms of outcomes? If Bill is a sophisticated, energetic, and assertive patient, he might get a smattering of the information he requires. But much of it is not available to either Bill, his providers, their managers, or the provincial ministry of health. They are in a sense shopping unarmed.

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