Oh, Canada’s health care

In many of Canada’s provinces, it is illegal to hire a doctor to perform a medical procedure if that procedure is also provided by the government. That is what I learned reading “The Healing of America” by T.R. Reid. Reid is a journalist with an interest in health care, which led him to travel to many foreign countries to investigate how health care is provided abroad.

Reid profiles how health care is delivered in five countries: Canada, France, Germany, Japan and the U.K. What all of the countries have in common is that their health care systems are inexpensive and egalitarian. The Canadians have taken egalitarianism to the extreme, preventing those with money from finding treatment outside of a public hospital (to see how the U.S. did something similar with its Medicare in the 1997 Balanced Budget Act, see this).

On page 136 of his book, Reid writes:

The private plans can’t pay for a flu shot or a cardiac bypass or a total shoulder arthroplasty, because those procedures are provided to everyone by Medicare.

That means if you want any of those things, you have to go through the government, which means being put on a waiting list. Reid himself was told he’d have to wait a year before an orthopedist would even look at his ailing shoulder, let alone receive treatment for it.

Reid also writes about how doctors who bill Medicare at all cannot perform any health care procedure for a fee. They are either entirely publicly funded or entirely privately funded. Because the government covers so many procedures, there are few privately-run health care firms.

What is the rationale for so heavily restricting access to private care? Reid alludes to the fact that many Canadians do not want a “two-tiered” medical system where the rich receive better care than the poor. Apparently, the goal of Canadian health care is not simply to improve the lot of the poor, but also to cut the rich down to size.

It’s hard for me to see how this is justifiable. Perhaps one could argue that doctors who are treating rich patients cannot also treat poor patients, so the poor really do suffer when the rich receive care because that’s care the poor could be receiving. That makes sense if the number of doctors is fixed, which it is in the short term but not in the long term.

Allowing the rich to receive additional care for a fee sends a signal to the market that demand for medical care is greater than before. Greater demand means higher prices for medical care, which prompts more people to become doctors, eliminating the shortage and allowing both rich and poor to receive medical attention.

Is there another reason for the ban on private care that I’m missing?


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