More privatization is not the answer for BC health care

Health care is a top priority issue for British Columbians and a key sector of the provincial economy.

Leading up to the 2024 election, the BC Conservatives are promising major health care reforms, in particular a greater role for private health care. More choice and competition, they claim, will “unleash the power of private-sector innovation” and reduce wait times. There’s good reason to be skeptical of such claims. 

This post looks at how we pay for health care in BC and the perils of flirting with privatization.

We mostly speak of the public health care system, but there are also many private interests in health care including services provided through private insurance as well as for-profit delivery of publicly funded services. If anything, BC needs to reverse creeping privatization already in the public system. 

Public and private health care 

Health care is a large and complex sector in BC with $34.5 billion per year in public expenditures and $14.8 billion in private expenditures in 2023 (Figure 1). Public and private shares represent 70% and 30% of total health expenditures, respectively, and 8.2% and 3.7% of GDP.^[1] 

After a period of declining public health spending-to-GDP in the 2010s—that is, annual increases were smaller than the growth of the economy—public spending has grown in recent years, including the response to the COVID-19 pandemic. Private health care spending has also been rising over time relative to GDP. 

Public health care in Canada has evolved substantially in the past half century, starting with coverage for hospitals then for physician services. These two areas remain the core elements of public health care, underpinned by the principle that “access to necessary medical care is based on need and not an individual’s ability to pay,” as written in BC’s Medicare Protection Act. Hospitals and physician services are also covered by the federal Canada Health Act, which bans extra-billing by physicians and user charges by hospitals as a condition of accessing federal funding.

Over the decades, public health care coverage has expanded to include other services, such as home care, long-term care, pharmaceutical drugs and other services. Public coverage in these areas varies by province and in BC there are co-payments and deductibles, and means-testing, unlike the situation for accessing hospitals and doctors. 

Outside of the public system, many employers provide private health insurance with coverage (to varying degrees) for prescription drugs, vision care, dental care and other supplementary health services. Those without private insurance must pay out-of-pocket or go without those services. The private insurance sector also leads to duplication of administrative functions, coordination of care challenges (if a family is covered through two different plans, for example) and incentives for private insurance companies to deny claims to bolster their bottom line. 

To accommodate a growing and aging population—as well as wage and salary pressures for health care professionals—public health care spending needs to grow annually by about 5% in order to maintain the same level of health care services. A growing economy is thus central to society’s ability to pay for health care. At the same time, the expanding frontier of technology also means more treatments, diagnostics and drugs are available than ever before, adding cost pressures for new services over time. 

In this context, claims that better public results can be achieved at less cost by adding private care are largely wishful thinking.

The Conservative Party platform alludes to reducing the share of health care expenditures relative to GDP, which would imply absolute reductions in public health care services. This contrasts with other parts of their platform that call for more doctors and nurses, and out-of-province care for diagnostics and medical procedures if waiting lists in BC are deemed to be too long, both of which will require more public dollars. 

Challenging Private Clinics 

A vision of private clinics coming to the rescue of public health care implicitly assumes that a host of doctors, nurses and other professionals are sitting on the sidelines and can only be activated by for-profit clinics. In reality, the number of health care professionals is limited. Efforts to expand post-secondary programs and recruit from overseas are major planks of the current government’s strategy, but to date have been insufficient to keep up with BC’s surging population. 

Already, some queue jumping via private clinics is allowed in BC for workplace injuries, with WorkSafeBC clients able to access private clinics like Cambie Surgery. Allowing more private clinics would further shuffle the chairs in terms of access, allowing those with money to jump the queue while others have to face potentially longer wait times as private clinics poach staff from the public health care system. These services would also likely be concentrated in major urban centres as small towns and rural areas are not profitable. 

The public-private split is significant in the context of the 2018 legal challenge from the Cambie Surgical Clinic to the Medicare Protection Act’s limits on accessing private health financing and extra billing. A victory by Cambie would have enabled people to seek parallel private care, a measure that would have amounted to queue jumping for the wealthiest due to the relatively fixed number of physicians in BC. In September 2020, the BC Supreme Court ruled in favour of the BC government, which defended the Medicare Protection Act. The Cambie appeals were dismissed in July 2022 by the BC Court of Appeal and in August 2023 by the Supreme Court of Canada. 

The BC government has also challenged through the courts creeping private health care financing. In 2022 and 2023 it made Telus Health and Harrison Healthcare back down in bids to charge thousands of dollars in fees to access their primary care clinics. However, these companies continue to exist by serving a grey area of “premium” health care services. 

A related case is Well Health, a Vancouver-based corporation with operations across North America, recruiting physicians into for-profit primary care clinics with an emphasis on new technology and administrative functions. Well Health also performs diagnostic and non-medically-necessary services and provides “executive” health services (an assessment, not covered by the public sector, costs $2,750).

Allowing more broad-based private care options only diverts resources to the most affluent, with the inevitable result that care and access will be worse for low-income households. The key distinction here is payments for “medically necessary services,” as per the Medicare Protection Act, but the boundary is blurry. Ultimately, a public model is needed in areas where private interests are seeking business such as virtual care, laboratories and diagnostics. 

Contracting out publicly funded services to for-profit providers (also called outsourcing or for-profit delivery) is a related but distinct form of privatization. A 2023 report by the BC Seniors’ Advocate notes that more than two-thirds of publicly funded long-term care spaces in BC are contracted out to both non-profit (33%) and for-profit (35%) entities. Despite their contractual obligations to health authority funders, the report found that for-profit care home operators failed to deliver half a million care hours and non-profit care homes spent 24% more per resident on direct care. 

In early 2020, the BC government seized control of four Retirement Concepts facilities due to inadequate care of seniors. Private, for-profit delivery sets up perverse incentives to reduce staffing and quality of care to boost profits. As researcher Andrew Longhurst points out, public dollars have funded both the profits of long-term care providers along with providing the revenue stream to finance the company’s mortgage, meaning the public sector loses the real estate assets created by its own funding.

Looking to Public Solutions 

Rather than indulge privatization, there is good reason to believe the scope of public health insurance should be expanded. CCPA has long advocated for public health care reforms aimed at integrated, team-based care, which can alleviate workplace stress and burnout for physicians and other professionals, including better control over hours and reduced administrative demands. This includes physicians paid by salary as well as more intensive use of nurses and allied health professionals, such as physiotherapists and counsellors. 

Community Health Centres (CHCs) are a model of primary care that can lower health costs, improve health outcomes and reduce health inequities. CHCs provide continuous (or longitudinal) daytime and after-hours access to their patients, emphasize prevention and health promotion and support chronic disease management. One of the key strengths of CHCs is that providers build long-term relationships with their patients and understand their health conditions and can meet their primary care needs under one roof. 

The BC government has been more supportive of CHCs in recent years, establishing six new CHCs,^[2] but a bigger push is needed. CHCs are key to spending smarter in health care. As health researcher Marcy Cohen notes, “the majority of health services and expenditures are for people living with chronic conditions. It is estimated that two thirds of medical admissions via emergency rooms are due to the exacerbation of a chronic disease, and 80 per cent of primary care physician visits are related to chronic conditions.” 

With more than one million people in BC aged 65 and over in 2024, seniors’ care is inevitably a major part of the health care system. While most seniors are able to live independently, aging inevitably requires increasing amounts of support and care. Three important dimensions of seniors’ care are home health care (including home support nursing), assisted living and long-term care, all of which ideally form a continuum of housing and health care for seniors. 

There is general agreement that supporting seniors at home is preferred if it allows for appropriate and regular contact with the health care and community-based social support systems. Supporting seniors is important for early interventions that could grow into more expensive interventions later on. The Ministry of Health estimates that some 15% of long-term care patients could be in home care. 

At the end of the day, we want a healthy population, which includes a well-funded health care system providing essential services. But too often we neglect the bigger picture and the factors that can cause ill health. Social determinants of health encompass a wide range of factors including socioeconomic status, education, employment, working conditions, housing and social inclusion. 

In BC, poverty and inequality are arguably major drivers of health care spending in various ways, including diseases arising from living in poverty. Top of mind should be the need for poverty reduction and housing plans aimed at ending homelessness. Addressing these challenges, supported by public investments in health care and housing, are key to a progressive reform agenda for public health care. 

Notes

[1] The bulk of public expenditures, $32.5 billion, are direct BC government expenditures. There are also other public expenditures in BC by the federal government (including armed forces, veterans and Indigenous people), municipal governments and social insurance plans (mostly workers’ compensation) amounting to $2 billion in 2023.

[2] RISE CHC (Vancouver-Collingwood), Roots CHC (Delta), Island Sexual Health CHC (Victoria), Westshore CHC (Colwood), Luther Court CHC (Victoria) and Umbrella Multicultural Health Cooperative (New Westminster).

Topics: Election commentary, Health care