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Presentation to the Standing Committee on Finance Pre-Budget Consultations : Securing Our Future . . . Balancing Urgent Health Care Needs of Today With The Important Challenges of Tomorrow

https://policybase.cma.ca/en/permalink/policy2013
Last Reviewed
2020-02-29
Date
2001-11-01
Topics
Health systems, system funding and performance
Health human resources
  1 document  
Policy Type
Parliamentary submission
Last Reviewed
2020-02-29
Date
2001-11-01
Topics
Health systems, system funding and performance
Health human resources
Text
The Canadian Medical Association (CMA) values the open, constructive and ongoing dialogue afforded by the Standing Committee on Finance’s Pre-Budget Consultations process. As a society, it is essential that we make every effort to work together to find lasting solutions to what are a series of complex and interdependent policy issues, especially during these turbulent times. Last August, the Committee set out objectives for this year’s consultations. You asked for advice on how to ensure that Canada remains a major player in the New Economy while providing Canadians with equal opportunities to succeed and create a socio-economic environment where they can enjoy the best quality of life and standard of living. However, world events have intervened and the urgent has crowded out the important. The CMA has suspended, for the most part, what we consider important longer term issues in an effort to do our part in helping guide the government’s deliberations in this time of national need. We support the government’s commitments, to date, in response to the events of September 11 and their aftermath. We are cognizant of the economic forecasts that show a slowing economy as a result and the need to re-focus our national attention on security issues. The overriding challenge for this Committee therefore, will be to develop recommendations for the next budget that address the current and future situation with respect to national security without losing sight of internal needs such as pursuing the innovations necessary to ensure the long-term sustainability of our health care system. Indeed, we see the latter as supporting the former. The CMA is committed to working closely with the federal government to ensure that Canada’s health care system can respond to immediate health security challenges. Our members are committed to continuing to ensure that Canadians’ confidence is restored by developing and implementing policy initiatives that serve to strengthen Canadians’ access to quality health care when they need it. To this end and building on our efforts since September 11, the CMA has put together a to meet these objectives. Specifically, the CMA has examined and developed recommendations that address national preparedness in terms of security, health and capacity; the capacity of our health human workforce in addressing current and future demands; and a look beyond the urgent to the necessary, in the form of a proposed process to review tax policy in support of health policy. II. PREPAREDNESS Health and Security The events of September 11, 2001 have had a profound impact on the lives of Canadians. Anxiety over the openness of our borders, the safety of our airlines and our vulnerability to attacks filled the media and our conversations in the days following the tragedies in the United States. A Canadian Ipsos Reid Express survey taken for the Canadian Medical Association October 23-25, 2001 indicated that 31% of respondents report ongoing sadness, anger, disturbed sleep, or are overprotective of their children. 1 This confirms what our members are telling us, based on everyday practice. A GPC International survey indicates that three-quarters of Canadians have a moderate to strong fear that the US-led anti-terrorist campaign will lead to Canada being a possible terrorist target. 2 An earlier Canadian Ipsos Reid Express survey taken October 1, 2001 shows that the attacks have risen to the top of the list of issues (73%) that should receive the greatest attention among our leaders. 3 Social issues, including health, are the second rated (49%) concern among Canadians. The Canadian Medical Association’s response following the terrorist attack was immediate and is ongoing. Working through and with our provincial/territorial Divisions and Affiliates, the Association began collecting names of those physicians willing to offer assistance to US agencies dealing with the tragedy should it have been requested. As well, we spearheaded the development of the Canadian Mental Health Support Network (www.cma.ca/cmhsn), which includes Health Canada and twelve other national health associations, to help Canadians and Canada’s health professionals cope with the mental health aftermath of the attack. The work of this network continues in terms of a series of public security announcements to be released very soon and in terms of ensuring that the information available through health professionals is clear, concise and consistent. We also provided continuous updated advice to Canadian doctors about bioterrorist threats. In the early days of the anthrax scare, before Health Canada had materials available for the public, hundreds of calls for information to 1-800-OCanada were referred daily by Health Canada to the CMA. However, there is an aspect of this issue requiring urgent attention given the current environment. It is the ability of our health system to respond to a disaster, be it a terrorist attack, a natural disaster or a large scale accident. As the Canadian Medical Association and others have documented, the people and the infrastructure of our system is already stretched in its capacity to deal with everyday demands. We have seen that emergency rooms across this country can barely cope with the increased demands brought on by the annual flu season. The system is already operating at or beyond capacity. Devastation approaching the scale of September 11 has not been seen in Canada since December 6, 1917 with the Halifax explosion. While no health system can ever be fully prepared to meet such a staggering level of destruction, it must have the confidence, the resources and, the disaster planning and referral systems to rise to the challenge if Canadians are to be reassured that help will be there if and when they need it. Public Health and Safety The challenge – if and when it comes – will require a local response that is supported nationally. To appreciate the scope of the work necessary to prepare the health system for the threats brought by terrorism it will be useful to understand the challenges currently facing public health in Canada. We have long enjoyed the benefits of a solid public health system through the various health protections, health promotion, and disease prevention and control programs created to maintain and improve the health of the population. The essential role of the medical officer of health in the public health system must be acknowledged, supported, and respected. Their credibility provides the community and health care professionals, particularly physicians, with balance and specialized medical expertise on public health matters. When the board of health is performing its mandated duties successfully, few are even aware that it is at work. Yet when a public health crisis strikes, the community expects rapid, knowledgeable, expert and quality attention to matters. But it can only do that if there is a strong infrastructure in place to meet the challenge. A clear and present danger is the emergence of new diseases or the re-appearance of old ones. An editorial in the April 27, 2000 issue of the New England Journal of Medicine expresses concern about the ability of public health infrastructures to cope with this problem without the resources needed to respond. 4 Increased trade, rising migration rates, and changes in the environment have led to worries over the revival of diseases thought to be under control or near extinction (e.g., human plague, tuberculosis and malaria) and even the recognition of some new “bugs”. The need to be vigilant about the re-emergence of infectious diseases was brought home to governments with a large outbreak of human plague in India in 1994. 5 Out of 876 cases reported, characterized as presumptive plague, 56 were fatal. A large outbreak of Ebola in Zaire in 1995 led to as many as 233 people dying from the disease and further strengthened the case for devoting resources to this problem. 6 West Nile Virus The New York City area got a first-hand look at this problem in 1999 with the appearance of the West Nile virus in North America. As the New York Times reported, it may have come in the blood of a traveler returning from Africa or Europe. 7 It may have arrived in an infected bird smuggled in baggage or even in a mosquito that got onto a jet. In spite of efforts to contain the disease, it has now begun to spread through the eastern portion of the continent, as far north as southern Ontario and as deep as Florida. Tuberculosis Tuberculosis remains one of the world’s two deadliest infections and it is feared to be on the verge of a major comeback. The disease kills 1.5 million to 2 million people a year, almost as many as AIDS. Experts say that toll could increase in the coming years because TB bacteria are evolving dangerous new strains that are increasingly drug-resistant. 8 Health Canada reports that there have been some cases (and deaths) in Canada of multiple drug-resistant TB (MDR-TB) strains. 9 Only Newfoundland, PEI and the territories have not had cases of drug-resistant TB. Latvia and Russia are considered “hot spots” in the world for MDR-TB. However, one in three reported isolates in New York City in recent years was MDR-TB. As well, highly resistant strains spread from New York to Florida, Nevada, Georgia and Colorado in less than two years. Malaria The World Health Organization estimates that one million die from malaria a year and 90% of those deaths are Africans (2500 African children under five die from malaria each day). 10 The disease seems to be dying back in other continents but growing stronger across Africa. The WHO report on infectious diseases describes malaria as having the power to “overwhelm a young child causing high fever, convulsions and breathing difficulties. With the onset of cerebral malaria the child lapses into a coma and may die within 24 hours.” 11 AIDS According to the WHO, there are over 33 million people worldwide living with HIV/AIDS. 12 The hardest hit area is sub-Saharan Africa where one in four of the adult population has HIV/AIDS. In South Africa, 10% of the population is now infected with HIV. 13 The problem among pregnant women is worse, with 22% infected with HIV. In May, 2000, the US National Security Council declared that the spread of AIDS across the world is a threat to national security. 14 The concern, like many of the infectious diseases, is that eventually it will overwhelm the ability of governments to cope with the disease. The US government has sought to double to $254 million to combat AIDS overseas. Readiness Post-September 11 The tragic events of September 11 provided a grim reminder of the necessity of having a strong public health infrastructure in place at all times. As was demonstrated quite vividly that day, we do not have the luxury of time to prepare for these events. While it is not possible to plan for every contingency, certain scenarios can be sketched out and prepared for. To succeed, all communities must maintain a certain consistent level of public health infrastructure to ensure that all Canadian residents are protected from threats to their health. These are only some of the external threats. The Canadian public health system must also cope with domestic issues such as diseases created by environmental problems (e.g., asthma), sexually transmitted diseases, and influenza, among many others. Even before the spectre of bioterrorism this country’s public health experts were concerned about the infrastructure’s ability to deal with multiple crises. There are many vacancies among the public health physician and nursing staffs, particularly in rural and northern Canada as well as the First Nations units. This workforce is also aging and efforts to attract and retain staff have been lagging. The announcement of October 18, 2001 by the federal government of a $11.59 million investment was welcome news to Canadians in the aftermath of September 11. It provided for the “basics” in terms of stockpiling of necessary antibiotics, the purchase of sensor and detection equipment to help respond to radio-nuclear incidents, enhancing a laboratory network to better equip them to detect biological agents, and provide training to front-line health care professionals to help them recognize, diagnose and treat suspicious illnesses. However, far more needs to be done to improve our ability to respond to health and security contingencies of all kinds. The Walkerton water crisis is an example of the difficulties often faced by public health officials. Without the full resources (legislative, physical, financial, human) to do the job properly, the health of Canadians is potentially jeopardized. The Ontario Medical Association emphasized this point in its brief to the Walkerton Inquiry: “Unstable and insufficient resources hamper the Ontario public health system. Steps must be taken by the provincial government to enhance the ability of boards of health to deliver public health programs and services that promote and protect health and prevent disease and injury. Sufficient and reliable public health funding is critical.” 15 The CMA reinforced that message in a resolution passed at its 2001 Annual General Meeting: “That CMA recommend all levels of government across Canada urgently review legislation governing all aspects of drinking water from source to consumption to ensure that comprehensive programs are in place and being properly implemented, with effective linkages to local, provincial and territorial public health officials and Ministries of Health.” In a recent broadcast in the United States, Dr. Jeffrey Koplan, Director of the US Centers for Disease Control and Prevention laid out seven priority areas for building capacity and preparedness within a public health system: 16 * A well trained, well staffed public health workforce * Laboratory capacity to produce timely and accurate results for diagnosis and investigation * Epidemiology and surveillance to rapidly detect health threats * Secure, accessible information systems to help analyze and interpret health data * Solid communication to ensure a secure two-way flow of information * Effective policy evaluation capability * A preparedness and response capability which includes a response plan and testing and maintaining a high state of preparedness These points apply whether the threat is a natural disaster or a terrorist attack. Public health must be ready for all such threats. And, at present, we are told, that responding to a crisis like Walkerton or North Battleford, not to mention the possibility of co-ordinated bioterrorism, effectively results in public health units shutting down many core programs that are the building blocks of the health care system. As the long shadow of bioterrorism rises over Canada and menaces our health and wellbeing, these issues take on even more significance to Canadians. This Committee must do its part to provide for an “act locally by thinking nationally” with regard to public health support systems. The Current Context As noted above, prior planning and preparation is one of the keys to ameliorating the effects of such sudden and calamitous occurrences. It must be remembered that a catastrophic event of the nature that occurred on September 11 is a local event in that it happens within the jurisdiction of a specific municipality. The quality and level of the response depends on how well prepared the local authorities are for such actions. The local capacity to respond varies across Canada with some area health services (e.g., the larger urban centres) better prepared and equipped than others (there may be jurisdictions that do not have plans). Regardless of how well prepared any municipality is there is always the very strong possibility that public health officials will be overwhelmed and need to turn to the province or territory for help. It is also possible that the event is so massive that even the provincial or territorial resources are besieged and it must call on the federal government with their stockpiles of medical supplies and access to epidemiologists and laboratory services. That assumes good planning before hand between the federal and provincial/territorial governments and that is not necessarily the case. There is an important role for the federal government to urgently improve the coordination among authorities and reduce the variability among the various response plans in cooperation with provincial authorities (and assist those in preparing plans where none exist). Health Canada must help facilitate efforts to rationalize preparations and make it easier for jurisdictions to assist one another in a time of disaster. This could include measures such as transferring patients quickly to facilities outside the affected area when the immediate hospitals are full or even to transferring them to other provinces or territories if necessary. Disease surveillance is another component of these measures. To be effective there must be, at the provincial and territorial level, linked electronic surveillance mechanisms that are standardized and the staff available to analyze and report the data. At the federal level, the government must be ready to provide data in a timely fashion, especially in an emergency. However, very few of Canada’s doctors will have seen the disease entities that threaten Canadians at the moment (e.g., anthrax, smallpox). The CMA has expressed its willingness to assist Health Canada in bringing together stakeholders to develop quickly a curriculum that would train health care professionals to recognize, diagnose and treat the new threats we face as a society. The government must also aid in the development of volunteer teams of health professionals and other experts that can be mobilized rapidly in response to disasters wherever and whenever they occur. The concept would be similar to the military's Disaster Assistance Response Team (DART). 17 DART consists of medical, engineering, logistics, communications and security personnel ready to deploy at short notice to anywhere in the world from their support base at Canadian Forces Base Trenton. It is crucial, that the federal government build and maintain its supplies for emergency use, its public health laboratories for early detection, its capacity to rapidly train and inform frontline health workers of emerging threats, its ability to assist the provinces and territories, and co-ordinate provincial responses in the event of overwhelming or multiple simultaneous threats. In this area, the CMA recommends that: 1. The federal government immediately provide a minimum of $15 million for an assistance fund to municipal and provincial authorities to improve the co-ordination of their emergency responses among public health officials, police, fire and ambulance services, hospitals and other services. This fund should be over and above a similar sized investment to ensure that Health Canada’s Centre for Emergency Preparedness can function even only at a minimal level of effectiveness. The announcement of October 18 by the Minister of Health that $11.59 million would be spent to enhance our response to a potential attack is an important step toward reassuring Canadians that help will be there when they need it. However, far more must be done to further expand the federal government’s ability to assist municipalities, provinces and territories in dealing with disasters. The vital role played by disease surveillance cannot be stressed enough. In the event of an unusual or particularly feared illness, or an outbreak of a preventable disease, the public’s attention can quickly focus on the public health unit’s response. The medical officer of health communicates with physicians (specialists and, general and family practices physicians) in the community. Physicians, especially general and family practice physicians, depend upon their medical officers of health and the health units as an important resource. This includes information on contact tracing, interpretation of unusual clinical symptomatology, vaccination, communicable disease control, outbreak control, environmental health, cluster investigation, epidemiology, travel medicine etc. An effective and efficient surveillance system must be in place in order to provide this data quickly to stop the spread of a disease as fast as possible. Unfortunately, a weak link in the existing surveillance system is communications. This has had an impact on health professionals’ ability to receive timely information regarding changes in disease incidence in their community. Regional, provincial/territorial and federal authorities must work to improve the coordination of communications at all levels to protect the health and wellbeing of Canadians in times of crisis. The CMA recommends that: 2. The federal government continue to invest, at a minimum, $25 million in the coming year in the resources and infrastructure (i.e., medical supplies, equipment, laboratory facilities, and training for health care professionals), needed to anticipate and respond to disasters. The sale of Connaught Laboratories meant that Canada lost much its residual capacity to manufacture vaccines. If this were a “normal” war, Canadians would be looking to divert our manufacturing capacity toward meeting the threat. Given the biological threat, the Government of Canada should be negotiating with the pharmaceutical industry to increase our capacity to produce a secure supply of vaccine on Canadian soil. This would include the need for more than one supplier and the capacity to increase quickly the production of the vaccine. The CMA recommends that: 3. That the federal government undertake an immediate review of Canada’s self-sufficiency in terms of critical medical supplies (e.g., vaccines) required in the event of disasters with a view to short term self sufficiency. Surge Capacity Among the first points of contact with the health system for Canadians in the event of a significant attack on our population it will be the doctors offices and the emergency rooms of our hospitals. As noted earlier, we have witnessed in recent years the enormous strain these facilities can be placed under when even something quite routine like influenza strikes a community hard. The media abounded with stories of patients waiting hours to be examined, of stretchers lining corridors and of ambulances being redirected from hospital to hospital. Canadians themselves experienced first-hand how the resources of the hospitals, particularly the human resources, were stretched to the breaking point. The acute care occupancy rates of Ontario public hospitals across the Ontario Hospital Association regions in 1999-00 illustrate this point. In three of the five regions (Eastern Ontario, Central and South West) the occupancy rate ranged from 94% to 97% 18. The highest rate was found in the very heavily populated Central region. A British Medical Journal study suggests that an occupancy rate over 90% indicates that the hospital system is in a regular bed crisis 19. This problem is not unique to Ontario: “the decrease in the number of acute care beds across Canada over the past decade, coupled with an aging population and our extraordinary success in extending the survival of patients with significant chronic illness, has eliminated any cushion in bed occupancy in the hospital system.” 20 With this in mind, picture a catastrophe similar in scale to the destruction seen in New York or Washington D.C. occurring in downtown Toronto, Vancouver or Montréal; or perhaps the release of smallpox or botulism over Fredericton or Winnipeg. As noted earlier, the public health system and medical diagnostic and treatment systems in the community and hospitals could become overwhelmed very quickly without the ability to absorb the extra caseload. Like our hydro system, that is why surge capacity must be built into the system nationally to enable hospitals to open beds, purchase more supplies, and bring in the health care professionals it requires to meet the need. An element of surge capacity that is seriously lacking is the federal government’s contribution to emergency bed space. With the closure of most of the Canadian Force’s hospitals and the severe loss of experienced health professionals in the military, the government’s ability to assist local and provincial/territorial civilian authorities should their systems become overwhelmed is limited. Currently the National Emergency Stockpile System can supply up to 40,000 cots, as well as medical supplies and relatively rudimentary hospital equipment. Reports indicate, however, that much of the equipment is decades old, and that protocols for logistical management (e.g., transport and rapid deployment) are outdated. There is an urgent need to reassess and reaffirm capacity in this context. The CMA is in close contact with the American Medical Association as they advise their government on coordinating the use of civilian and federal facilities in an emergency. Most hospitals work on a just-in-time inventory basis for the purchase of drugs. Without some sort of plan to quickly re-supply their pharmacies and expand their capacity, patient care will suffer. The federal government must assure Canadians that municipal and provincial plans are in place with an overarching national plan to support these jurisdictions if their service capacities are overwhelmed. As mentioned earlier, the announcement by the federal government of the $11.59 million investment to enhance our response to a potential attack is a good step. But the government must help further by making available an emergency fund that would enable hospitals to plan and organize their surge capacity. The CMA recommends: 4. The federal government provide, in the coming year, $25 million in specific earmarked funding to the provinces and territories to enable health care facilities to plan, build and maintain surge capacity (e.g., open more beds, purchase emergency supplies) into their systems. The purpose of having such elaborate response plans and stockpiles of supplies and equipment is to be ready for the possibility that, in spite of all efforts to prevent a catastrophe from occurring, it nevertheless happens. That is when responsibility for dealing with the aftermath of the event falls largely to the public health system where a strong and viable infrastructure must already be in place to meet the challenge. Without the resources and the preparations, the crisis might well deteriorate and spread beyond “ground-zero.” That notion is often very difficult for non-health sector agencies and organizations to appreciate and can be an impediment to improving our capacity to help Canadians in times of disaster. No one can be completely prepared but you can prepare for certain scenarios. That is where the federal government can facilitate the health system’s readiness and reassure Canadians that help will be there when they need it. The federal government has taken several steps to reassure Canadians that their physical safety is enhanced. This includes the introduction of the Anti-Terrorism Act and the development of an Anti-Terrorism Plan. As well, there is increased funding to the Canadian Security and Intelligence Service and the Communications Security Establishment to help those agencies do their jobs more effectively. The health system must be considered an integral component of any plan to combat terrorism. It too requires assistance, especially the public health infrastructure, in strengthening its ability to counter the effects of an attack, whomever or whatever is responsible. III. THE CAPACITY OF OUR HEALTH HUMAN WORKFORCE Although the right mix of physical infrastructure and sustainable, long-term funding is necessary, in and of itself, it is not sufficient to ensure that all Canadians have timely access to quality medical services. We must also have an adequate supply of physicians and other health personnel or the system will not have the flexibility or adaptability to respond to basic societal needs or a crisis in times of disaster. We believe that the health workforce in general is facing a major sustainability challenge, and as such, this section of the brief proposes initiatives that are not solely focused on physicians but the entire health human workforce. Reports produced by several health professional organizations show that although overall numbers may be increasing, it is not sufficient to meet future demands. In 2000, there was a moderate 1.7% increase in the nurse population 21; however, a 1997 Canadian Nurses Association report projected that the supply of nurses must grow by 2.1% per year to meet future demand. 22 Similarly, the number of physicians per 100,000 population appears to be increasing slightly each year (187 in 2000), but it remains below the 1993 level of 191 per 100,000 population. The physician to population ratio can be misleading in that it does not necessarily represent full time physicians. CMA figures show that a larger proportion of physicians fall into the older age groups and may not be working full time or indeed may not be providing patient care at all. Also, one needs to factor in the demographics of the current physician workforce. Female physicians, who tend to work fewer hours per week than their male colleagues, now represent 30% of the practising pool. This means that more physicians will be needed to provide the same number of services. But this may not be possible, as approximately two-thirds of all family physicians are no longer routinely accepting new patients. 23 This is placing considerable pressure on those currently working within the health care system with little hope for relief. For example, data gathered through the CMA’s annual Physician Resource Questionnaire (PRQ) substantiates anecdotal evidence that physicians are working harder. Over half the respondents to the 2001 PRQ (53.7%) indicated that their workload had increased over the past year. Looking at specific areas that have caused physicians the greatest degree of stress, 63.7% indicated that their workload is heavier than they would like (up from 62% in 1998), while 58.1% felt that their family and personal life had suffered from choosing medicine as a profession (up from 55% in 1998). There are a number of short-term and longer term initiatives that can be implemented to reverse the shortage in our health care personnel and alleviate the stress they are feeling from trying to keep the system operating as best it can. What follows is a description of the short-term initiative the CMA is proposing for consideration by the Standing Committee. For a detailed description of the longer term initiatives and recommendations, please refer to Appendix A. What Can be Done Today? Given the immediate need for more physicians and other health professionals in Canada and the time lag involved in training, especially for physicians, the CMA proposes that a variation on the strategy adopted by the Canadian Forces (CF) 24 be used to repatriate physicians and other professionals. The CF announced the implementation of a Medical and Dental Direct Entry Officer Recruitment Allowance effective April 1, 1999 to recruit licensed family physicians, general practitioners and dentists. Recruitment incentives involve a lump-sum signing bonus/recruitment allowance of $80,000 per direct entry medical officer and $25,000 per direct entry dental officer after a successful completion of 3 months of basic officer training. The commitment is for a duration of 4 years and retention incentives involve an adjustment to medical and dental rates of pay that are competitive with private sector net earnings. The CMA concurs with the concept of an incentive program as proposed by the CF and suggests that a similar approach be implemented for recruiting and retaining Canadian physicians and other health care professionals currently practising outside of Canada. Presently there are some 10,500 Canadian physicians practicing in the US as well as tens of thousands of Canadian nurses. Of these physicians, close to 1,000 are considered active physicians both in Canada and the US. 25 Some of these physicians are no doubt practising in border towns where dual licensure is common, but many may be expatriates who have maintained their licensure in Canada hopefully with plans to either return or at least leave their future options open. Rather than proposing a lump sum approach as an incentive the CMA proposes that the incentive come through graduated federal income tax relief by reducing federal income tax payable by 50% for 3 years for Canadian physicians and health care professionals who return to practice in Canada. Such an approach provides direct relief and over a period of 3 years would provide incentives similar in size to those proposed by the CF in their recruitment and retention program. It is estimated that such a program would cost approximately $45 million over 3 years to repatriate an estimated 5% or 500 physicians back to Canada. If repatriation of other health care providers were included then it is estimated that the total cost of such an initiative could increase to $85 million over 3 years. The CMA therefore recommends: 5. That the federal government seriously consider implementing a 3-year graduated tax relief and re-allocation policy to encourage expatriate physicians and other health professionals to return to Canada. IV. TAX POLICY IN SUPPORT OF HEALTH POLICY The federal government has played a key role in the development of our health care system, primarily through a variety of measures or policy levers such as: spending; taxation; regulation; and information. Up until now, Canada’s health care system has made extensive use of only two federal policy levers, namely spending, in the form of cost-sharing arrangements between the federal and provincial/territorial governments; and by regulation, through the Canada Health Act. However, the degree to which the government can continue to rely on these levers must be examined. In the not-too-distant future, our health care system will face a number of pressures that will challenge its sustainability. Namely, an aging and more demanding population in terms of the specialty care services and technology they will seek; the cry for expanding the scope of medicare coverage to include homecare and pharmacare; and a shortage of health personnel. Several national health care studies, namely the Prime Minister’s Forum on Health and more recently, the Senate Standing Committee on Social Affairs, Science and Technology’s Study of the Health Care System have raised the need to look at alternative health care funding sources. We can not and should not wait any longer to explore and act upon the options available to us. Looking at Alternatives One of the lesser-explored options has been the strategic use of Canada’s taxation system. A public discussion of tax policy has not been seen in Canada since at least 1966. 26 Nor have we seen a major assessment of tax policy in relation to social policy since the 1980’s Macdonald Commission. In fact, the last major overall tax policy review was that of Benson in 1971. There is an urgent need to more fully consider the role that the tax system can play in supporting the health care system. Several proposals have been put forward over time in this areas, such as earmarked taxes for health; health-related excise taxes; input tax credits for health care services; medical savings accounts; saving for long-term care; social insurance; and refundable tax credits. This list is not exhaustive. In fact, the CMA has done some preliminary work in this area by commissioning a discussion paper on taxation and health policy. 27 In the paper, the author puts forth 10 “real world” proposals where the tax system can be used to support health policy. The CMA has initiated detailed discussion with Health Canada, Statistics Canada and others to model some of the possible scenarios. Of course, some of these are more promising than others. It is for this reason that the CMA is recommending the federal government to establish a National Task Force to review the tax system with the purpose of developing innovative tax-based mechanisms that better synchronize tax policy with health policy. In this area, the CMA recommends: 6. That the Federal Government establish a blue ribbon National Task Force to study the development of innovative tax-based mechanisms to better synchronize tax policy and health policy. First and foremost this Task Force would study: a) increasing the reach of the medical expense deduction (i.e., increasing the threshold from the current 3% of taxable expenditures) b) extending the medical expense deduction from a non-refundable tax credit to a refundable tax credit so that those not having income tax payable are afforded easier access to those services not covered under universal health “programs” c) dealing with the untoward inequities arising out of the application of the GST. The CMA envisions the mandate of the Task Force as being – to conduct a thorough policy and costing analysis of all potential tax-based mechanisms (not limited to those outlined in the above recommendations) that can be developed to assist in the financing and management of the health care system. The Task Force would be comprised of representatives from government, the health care system, private sector, and the public and it would issue its findings and recommendations within 2 years of its conception. V. SUMMARY OF RECOMMENDATIONS In closing, the CMA has offered a powerful and strategic combination of policy initiatives designed to re-vitalize Canada’s health care system as well as to restore Canadians’ confidence that they will be taken care of in times of disaster. The proposals are realistic and practical. They give the provinces and territories full flexibility in terms of policy implementation while ensuring full recognition to the federal government for its essential investments. These proposals emphasize the need for the federal government to continue its leadership to ensure that our health care system, Canada’s most cherished social program, is available to meet the health care needs of all Canadians. No one group can address all of the issues and challenges facing the health care system. The CMA reiterates its commitment to work with the federal government and others to ensure that our health care system will be there for all Canadians in the future and in times of crisis. The Summary of Recommendations is as follows: 1. The federal government immediately provide a minimum of $15 million for an assistance fund to municipal and provincial authorities to improve the co-ordination of their emergency responses among public health officials, police, fire and ambulance services, hospitals and other services. 2. The federal government continue to invest, at a minimum, $25 million in the coming year in the resources and infrastructure (i.e., medical supplies, equipment, laboratory facilities, and training for health care professionals), needed to anticipate and respond to disasters. 3. That the federal government undertake an immediate review of Canada’s self-sufficiency in terms of critical medical supplies (e.g., vaccines) required in the event of disasters with a view to short term self sufficiency. 4. The federal government provide, in the coming year, $25 million in specific earmarked funding to the provinces and territories to enable health care facilities to plan, build and maintain surge capacity (e.g., open more beds, purchase emergency supplies) into their systems. 5. That the federal government seriously consider implementing a 3-year graduated tax relief and re-allocation policy to encourage expatriate physicians and other health professionals to return to Canada. 6. That the Federal Government establish a blue ribbon National Task Force to study the development of innovative tax-based mechanisms to better synchronize tax policy and health policy. First and foremost this Task Force would study: a) increasing the reach of the medical expense deduction (i.e., increasing the threshold from the current 3% of taxable expenditures) b) extending the medical expense deduction from a non-refundable tax credit to a refundable tax credit so that those not having income tax payable are afforded easier access to those services not covered under universal health “programs” c) dealing with the untoward inequities arising out of the application of the GST. APPENDIX A The Capacity of Our Health Human Workforce Looking to the Future There are some signs that governments have begun to acknowledge that we are in a sustained shortage situation. In November 1999, several health ministers met with members of the Canadian Medical Forum Task Force on Physician Supply in Canada which recommended 2000 first year medical school places for 2000. Since then, governments have been very active in committing to increases in both undergraduate and postgraduate medical training. Enrolment of new medical students in 2000/2001 reached 1763 for an increase of 12% since 1997/98. This closely matches the promised increases to undergraduate enrolment made by governments. Approximately 140 more positions have been promised for the school years beginning 2001 and 2002. In this area, the CMA recommends that: 7. That the federal government immediately establish a Health Human Resources Education and Training Fund in the amount of $500 million per year for 5 years to fund: (1) increased enrolment in undergraduate and postgraduate education; and (2) the expanded infrastructure (both human and physical resources) required at Canada’s 16 health science centres as a result of increased enrolment. While the outlook for the future supply of physicians in Canada seems brighter, it will be quite a few years before we can benefit from the current increases in undergraduate enrolment. These initiatives must not only continue, but be enhanced to ensure that our health care system is sustainable into the future. However, there is one factor that may keep us from attaining the optimal level of medical school enrolment – high and rising medical school tuition fees. In August 2000, at the Conference of Premiers, Prime Minister Chretien said, “It is indeed important in the new knowledge-based economy that Canadians … have access to high quality post-secondary education without excessive debt loads, and that every child get the best possible start in life. This is all part of the Canadian competitive advantage.” 28 This sounds well and good, but the facts tell us otherwise. Since 1980, medical school tuition costs have increased by almost 880%, or more than twice as fast as the general cost of living. 29 The average tuition for students entering first year medical school in September 2001 was $12,840, a 158% increase over the 1997 average fee of $4,977. This means that over the course of four years, an undergraduate medical student is likely to spend approximately $110,000 in tuition, academic and living expenses. 30 Many students have had to resort to bank loans to cover the shortfall from their government-sponsored student loan, but the growing amount of debt accumulating for medical students is starting to worry the banks. The CIBC says that rising medical education costs have resulted in debt loads growing much faster than medical students’ potential income and so, it will no longer grant medical students preferred lending rates. The CIBC sets limits on the amount of debt that they feel students can repay in the years following their training. Unfortunately, medical students are now reaching these limits – which are in the $100,000 - $130,000 range. 31 Unlike the government-sponsored loans, interest on bank loans begin accruing immediately, up to a decade before a medical student starts earning a full income. This trend raises serious concerns that access to medical education will be restricted solely on the basis of personal financial resources. High debt loads will discourage capable and qualified students – particularly those from modest financial backgrounds – from applying to medical school. Canada’s health care system needs individuals from different socio-economic, cultural, rural and urban backgrounds to serve an equally diverse population of patients. First and foremost, the government must address the situation concerning the high and rising tuition fees and the insufficient financial support systems available to medical students. It must also consider purchasing additional training positions in Canada’s medical schools specifically targeted for groups, such as Aboriginal, Indian and Inuit populations. These measures will foster the education and training of a diverse population of health care givers, and will support the culturally and socially sensitive health care needs of all Canadians. The CMA sees a strong role for the federal government in ensuring that medicine remains a rewarding and affordable career accessible to students based on their passion and academic performance, not their financial status. The CMA therefore recommends: 8. That, in order to alleviate some of the pressures driving tuition fee increases, the federal government increase transfer payments to the provinces/territories with targeted amounts for post-secondary education. 9. That the federal government create and fund a national health services student bursary program to encourage students who have limited financial resources to apply for an education in health care services. 10. That the federal government develop financial support systems for health services students that are: (a) non-coercive; (b) developed concomitantly or in advance of any tuition increase; (c) in direct proportion to any tuition fee increase; and (d) provided at levels that meet the needs of the students. 11. That the federal government purchase additional training slots in Canadian medical schools for particular segments of our population, such as aboriginals. REFERENCES 1 Canadian Ipsos Reid Express. Terrorist Effect. October 23-25, 2001. 2 GPC International. Canadians split on the best response to the terrorist attacks and fear reprisals at home. Media Release October 18, 2001. www.gpcinternational.com/media/releases/20011018.html 3 Canadian Ipsos Reid Express. The Public Agenda Post September 11, 2001. October 1, 2001 4 Osterholm M. Emerging infections – another warning. NEJM 2000; 342(17) http://www.nejm.org/content/2000/0342/0017/1280.asp. 5 World Health Organization. Plague Manual – Epidemiology, Distribution, Surveillance and Control. The Organization: 1999. http://www.who.int/emc-documents/plague/docs/whocdscsredc992a.pdf 6 Sanchez A. et al. Reemergence of Ebola virus in Africa. Emerging Infectious Diseases Vol. 1(3); July-September 1995. http://www.cdc.gov/ncidod/eid/vol1no3/sanchez.htm. 7 Revkin A. Mosquito virus exposes the hole in the safety net. New York Times Oct. 4, 1999. http://www.nytimes.com/library/national/regional/100499ny-pest.html 8Okie S. Tuberculosis is threatening to make a comeback. International Herald Tribune Aug. 11, 1999. http://www.iht.com/IHT/TODAY/WED/IN/tb.2.htm 9 Health Canada. When anti-tuberculosis drugs don’t work. Tuberculosis Epi Update January 2000. http://www.hc-sc.gc.ca/hpb/lcdc/bah/epi/tbdrug_e.html. 10 BBC News Online. Africa confronts malaria. Apr. 25, 2000. http://www.bbc.co.uk/hi/english/world/africa/newsid_724000/724445.stm 11World Health Organization. World Health Organization Report on Infectious Diseases – Removing Obstacles to Healthy Development. Geneva: The Organization, 1999. http://www.who.int/infectious-disease-report/pages/textonly.html 12 Ibid. 13 BBC News Online. South Africa AIDS crisis worsens. Apr. 19, 2000. http://www.bbc.co.uk/hi/english/health/newsid_719000/719183.stm 14 Richwine L. US declares AIDS a threat to security. National Post May 1, 2000 A1. 15 Ontario Medical Association. Ontario Medical Association Input to Walkerton Inquiry Part II: Protecting the Public’s Health. Toronto. April 2001 16 Koplan JP. Building Infrastructure to Protect the Public’s Health. Public Health Training Network Broadcast September 21, 2001 (Downloaded from Web: October 19, 2001 www.phppo.cdc.gov/documents/KoplanASTHO.pdf ) 17 Dept. of National Defence. Canadian Forces Disaster Assistance Relief Team. BG-99-051 (Amended) October 10, 2001. (Downloaded from Web: October 25, 2001 [www.dnd.ca/eng/archive/2001/oct01/28DART_b_e.htm] 18 Ontario Hospital Reporting System, 2001. Acute Care Occupancy Rates, Ontario Public Hospitals by OHA region, 1999/00. Ontario Ministry of Health and Long Term Care. 19 Bagust A, Place M, Posnett J. Dynamics of bed use in accommodating emergency admissions: stochastic simulation model. BMJ; 319: 155-158 July 17, 1999. 20 Nicolle L. Viruses without borders. Can J Infect Dis Vol. 11, Issue 3, May/June 2000 (Downloaded from Web: October 23, 2001: www.pulsus.com/Infdis/11_03/nico_ed.htm) 21 CIHI. Canadian Institute for Health Information Reports Moderate Rise in Register Nurses Workforce, Fewer RNs Working on Casual Basis, More Working Full-time, Media Release, May 23, 2001. 22 Canadian Medical Association. Specialty Care In Canada: Issue Identification and Policy Challenges, October 2001. 23 Canadian NewsWire. Not enough family-physicians to meet patient needs, October 25, 2001 [www.cnw.ca/releases/October2001/25/c0304.html] 24 Incentive Programs for the Recruitment and Retention of Medical and Dental Officers, http://www.dnd.ca/eng/archive/1999/jul99/05DocIncen_b_e.htm 25 Based on a linkage done by Canadian Institute for Health Information of data from Southam Medical Data Base and the America Medical Association’s Masterfile. 26 Carter K. Royal Commission on Taxation, Canada, 1966. 27 Thompson A. Taxation and Health Policy: A Discussion Paper, August 2001. 28 Letter from Prime Minister Jean Chretien to the Honorable Gary Doer, Premier of Manitoba, Chair, Conference of Premiers, August 4, 2000. 29 Ontario Medical Association. Medical Education Fact Sheet, 2001. 30 Admissions/Student and Equity Affairs, Faculty of Medicine, University of Western Ontario. Budgeting Guide for Medical Students: 1999-2000. 31 Banks no longer banking on earning potential of medical students, Canadian Medical Association Journal, June 12, 2001; 164(12) 1735
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Rural and remote health in Canada : Presentation to the Standing Senate Committee on Social Affairs, Science and Technology

https://policybase.cma.ca/en/permalink/policy2017
Last Reviewed
2019-03-03
Date
2001-05-31
Topics
Health human resources
  1 document  
Policy Type
Parliamentary submission
Last Reviewed
2019-03-03
Date
2001-05-31
Topics
Health human resources
Text
As Secretary General and Chief Executive Officer of the Canadian Medical Association (CMA), I am here today representing our members, more than 50,000 physicians from across Canada. The Association has a two-fold mission, namely to provide leadership for physicians and to promote the highest standards of health and health care for Canadians. The CMA wants to expand significantly on part of its May 16th presentation to this Committee on health human resources. The issue of rural and remote health is of concern to the CMA and we commend the Committee for tackling this complex and very important aspect of Canada's health care system. Our presentation will focus primarily on physician workforce issues in rural and remote practice locations. Most would agree that the health care infrastructure and level of professional support in rural and remote areas of Canada are insufficient to provide appropriate care, and contribute significantly to the difficulty in recruiting and retaining qualified physicians in sufficient numbers (relative to community needs). I will address the following elements: 1. the distribution of physicians practising in rural and remote Canada; 2. their practice profile; 3. what rural physicians are telling us; 4. the CMA Policy on Rural and Remote Practice Issues; and 5. the role for the Federal Government in ensuring reasonable access to health care in these parts of the country. 1. Distribution of physicians practising in rural and remote Canada As you know, Statistics Canada informs us that approximately 25% of Canadians live in rural areas. This number varies from 15% in British Columbia and Ontario to 45% in Atlantic Canada and as high as 60% in the territories. The distribution of physicians is somewhat different. The following data are derived from the CMA physician resources database: * Approximately 10% of Canadian physicians practise outside census metropolitan areas or census agglomerations. This roughly translates to communities of 10,000 or less and for research purposes we consider this cohort to be rural physicians. * There are about 5,700 rural physicians, 87% of which are family physicians. The male/female split is similar to the overall physician pool in Canada but, among those under 35 years of age, half are female. This reflects the current breakdown of the postgraduate output and implies that females are just as likely to seek out rural practice as males. * While Quebec and Ontario are home to almost half of all rural physicians in Canada, Newfoundland has the highest proportion of rural doctors (31%) followed by New Brunswick at 23% and Nova Scotia at 21%. The territories are considered separately since one could argue that even those physicians living in northern cities would be considered to be practising in a remote area. * The majority of rural physicians are graduates of Canadian medical schools (72%) but it varies greatly by region. In Newfoundland, one in three rural physicians is a Canadian graduate; in Saskatchewan, it is only one in five. In contrast, 95% of Quebec rural physicians were trained in this country. 2. Practice profile The CMA routinely surveys the Canadian physician population. Response rates for the surveys mentioned in this brief are shown in Table 1. The following data from CMA's 2000 Physician Resource Questionnaire will be of interest to the Committee: * rural physicians are more likely to be in group practice than urban physicians (68% vs. 58%); * 78% of rural physicians take call (compared to 75% of urban physicians); * excluding their on-call time commitments, rural physicians report spending the same number of hours on direct patient care as urban physicians; * however, rural physicians are on-call for more hours in a month than their urban colleagues; not only do they see more patients while on-call but they also spend more hours providing services; * rural physicians are more likely to be compensated for being on-call, whether it is for carrying a phone or pager (37% are compensated vs 10% of urban physicians) or being available on-site (60% are compensated vs 31% of urban physicians); * while more than half of rural physicians are paid primarily on a fee-for-service basis, proportionately fewer physicians are remunerated this way (53%) compared with 63% of urban physicians. Rural physicians are more likely than their city colleagues to be paid with a salary or some type of blended arrangement. When asked how they would prefer to be paid, 40% selected blended compared to 30% of urban doctors. Less than a third (31%) preferred fee-for-service. Please see Table 2 for an overview of these results. 3. What rural physicians are telling us In the last ten years, in addition to CMA's annual general physician resource questionnaire, two surveys (in 1991 and 1999) were specifically designed to address issues pertaining to physicians practising in rural and remote areas of Canada. I would like to highlight some results from both these surveys. 1991 Survey * Over half of the survey respondents selected desire for rural practice as a very important factor in the decision to locate in a rural area (Figure 1). Only 11% reported financial incentives as being very important. * The physicians who moved from a rural to an urban area were asked about the importance of selected professional considerations (Figure 2). Hours of work was by far the most frequently cited as very important (39%), followed by the need for professional backup (28%) and access to specialty services (24%). * The physicians who moved from a rural to an urban area were asked about the importance of selected personal considerations (Figure 3). Children's educational opportunities was the most frequently cited (by 36%) as very important among the personal considerations, followed by career opportunities for their spouse. * The physicians who moved from a rural to an urban area indicated that there were a number of professional factors that might have influenced them to stay (Figure 4). These factors include additional colleagues (56%), locum tenens (48%), opportunity for group practice (41%) and specialist services (36%). 1999 Survey * In a tracking question from the survey conducted eight years previously, the 1999 survey found that, while rural physicians' level of personal satisfaction with their choice to practise and live in rural communities has remained constant, their level of professional satisfaction - i.e., how they are able to meet the health care needs of their patients - fell significantly since the early 1990s. In a striking example, only 17% reported being very satisfied with the availability of hospital services in 1999 compared to 40% in 1991. * Rural physicians identified the following five factors as being most important in defining their practice community as rural: (1) a high level of on-call duty; (2) the long distance to a community health centre or hospital; (3) lack of services from medical specialists; (4) an insufficient number of family physicians or general practitioners; and (5) the long distance to a teaching hospital (tertiary health care centre). CMA's findings were supported by the 1999 report from Barer and colleagues 1 that identified the following barriers to recruiting and retaining physicians in underserviced communities in Canada: (1) lack of adequate training for the unique circumstances associated with practising medicine in rural environments; (2) remuneration issues; (3) onerous on-call duties and, more generally, heavy workload leading to burnout; (4) professional isolation; (5) lack of spousal employment opportunities; (6) children's education and extracurricular opportunities; (7) climate, recreational and cultural opportunities; and (8) distance from family and friends. CMA 2001 Physician Resource Questionnaire To illustrate some of these findings and highlight some of the positive events, the following quotes are taken from CMA's most recent survey of physicians (the response rate is unavailable for this survey which is still in the field): I know one of the biggest problems my rural colleagues suffer from is lack of locums and difficulty replacing doctors in the community leading to heavier patient loads and responsibilities. This has particularly become worse since medical students have had to choose earlier about specialties with less options to return later. Somehow students and residents should be exposed to more rural medicine. Rural surgical specialists have onerous responsibilities placed upon them with little backup, expectations for 24/7 call coverage ad no financial compensation or recognition for their unwavering devotion to their communities and their profession. My colleagues and I are a dying breed and do not expect that we will be replaced. There is little incentive to practise in a rural environment yet the need continues to grow. Although Fort Frances is rural/remote, we have managed to recruit and retain excellent physicians. We service a catchment area of 22,000 and have 10 MD's on the call rotation. We are an example of how you can live rural/remote, practise interesting medicine and have great quality of life. Most people would think we are over-doctored here but it is the only way we can sustain a healthy lifestyle. Nonetheless the lifestyle of on-call, long irregular hours, and a physician spouse has been hard on the family and relationship. I dream of having regular hours and never having to answer the phone in the middle of the night. 4. CMA Policy on Rural and Remote Practice Issues In October of last year, the CMA released its Policy on Rural and Remote Practice Issues. A copy of this policy is appended to this presentation. The policy contains 28 specific recommendations in the three key areas of training requirements for physicians practising (or wanting to practise) in rural and remote Canada, compensation, and work and lifestyle support issues. The policy illustrates the breadth of issues that need to be addressed before we can hope to alleviate the shortage of the rural physician workforce. The CMA believes that strategies developed to recruit and retain physicians to rural and remote Canada must be comprehensive, flexible and varied to meet and respond to local needs and interests; they must also include, from the outset, community and physician input. The CMA also believes that, as a general rule, these strategies should not be coercive in nature, for example mandatory return-in-service contracts with new medical students. However, this is not to say that strong, positive incentive programs would not work. The Nova Scotia Department of Health, for example, developed a successful incentive program for physicians (including a guaranteed minimum income, a signing bonus and moving expenses, among others) and, importantly, hired a full-time recruiter to implement it. Under this program, 52 physicians were recruited in 1999, 50 in 2000 and 15 so far in 2001; none of these physicians were actively recruited from other Atlantic Canada provinces. There are also examples from the international scene. In Australia, the National Rural Health Strategy involved funding a rural incentives program and the creation of the Australian Rural Health Research Institute (a consortium of five universities with rural campuses). The Australian Journal of Rural Health was also funded through this strategy. The incentive program included relocation grants, grants for continuing medical education and funding for temporary replacements (locums). While this strategy has been well received, there are still many problems of reasonable access to primary care in many parts of rural Australia. In the United States, a financial incentive program, with its roots in the HMO act of 1973, uses an index of medical underservice to determine which areas receive the most funding. The CMA developed an index of rurality in 1999 which could be used in a similar fashion should the federal government decide to become involved in a similar program. 5. Role for the Federal Government The CMA and others have identified a number of issues that need to be addressed to increase physician recruitment and retention in rural and remote Canada. While our presentation appropriately focuses on the physician workforce issue, this situation applies to other health care professions as well. On this note, the CMA has recently embarked on a study, in collaboration with the Society of Rural Physicians of Canada and the Canadian Nurses Association, that will examine the rural workforce of a number of health care professions. We understand that, constitutionally, it is the role and responsibility of the provincial and territorial governments to oversee the provision of health care within their respective jurisdictions. Nonetheless, the CMA has identified five major leadership opportunities for the Federal Government in ensuring that Canadians who live in rural and remote areas have access to appropriate health care. These opportunities are in delivery, evaluation, immigration, planning and funding. Allow me to expand on each of these: i) Delivery: the Federal Government already has a health care delivery role in rural and remote Canada through the Indian and Northern Health Services Directorate of Health Canada. It would be important and valuable to identify lessons learned from this role and share this knowledge with all jurisdictions and players (for example, how physicians can best work with out-post nurses). ii) Evaluation: the CMA applauds the creation of the federal Office of Rural Health within Health Canada. We encourage the Federal Government to expand the role of this office so it can carry out an ongoing evaluation and roll-up of rural health and workforce status; this would become a reliable source of information for researchers, planners and decision-makers. iii) Immigration: in order to meet the short-term health care needs of Canadians, the CMA encourages the Federal Government, through Bill C-11, to develop an immigration policy that is friendly towards qualified international medical graduates. At the same time, any such policy must recognize the need for Canada to strive for reasonable self-sufficiency in the production of physicians. iv) Planning: we need a national planning approach for the short, medium and long term. Again, the CMA encourages the Federal Government to expand the role of its Office of Rural Health, with adequate support and funding, to carry out a comprehensive workforce needs assessment in rural and remote Canada. This information is critical to a successful planning process. v) Funding: finally, there is a role for the Federal Government in funding a mechanism whereby physicians and other health care professionals who want to prepare for practice in rural and remote Canada can obtain the appropriate training and experience. This is one of the main identified barriers to recruitment and retention in rural and remote areas. There is a precedent for the Federal Government in providing one time only funding to create capacity: this was in the 1966 Health Resources Fund Act, whereby the Federal Government funded the creation of new medical schools and the expansion of existing ones. The Federal Government could do the same thing now for the rural and remote workforce capacity. As you know, the Government of Ontario has recently announced the creation of its Northern Ontario Rural Medical School. This begs the question about the rest of the country and opens the door to the Federal Government to work with the Association of Canadian Medical Colleges, the CMA and other relevant medical education organizations to address this issue on a national scale. I want to thank the Committee for inviting us to appear today and we trust that we will have further opportunities to appear before this Committee and work with you during the course of this study. [TABLE CONTENT DOES NOT DISPLAY PROPERLY. SEE PDF FOR PROPER DISPLAY] Table 1 - Response Rates of CMA Surveys to Rural Physicians Year Response rate Sample size of respondents Accuracy level (19 times out of 20) 1991 CMA survey Rural cohort Rural to urban cohort 55% 49% n = 1320 n = 196 +/- 2.7% +/- 7.0% 1999 CMA Rural survey 31% n = 1658 +/- 2.5% 2000 CMA Physician Resource Questionnaire 40% (rural respondents) n = 253 rural respondents +/- 6.2% [TABLE END] [TABLE CONTENT DOES NOT DISPLAY PROPERLY. SEE PDF FOR PROPER DISPLAY] Table 2 - Results of the CMA 2000 Physician Resource Questionnaire Rural Urban Take call 78.3% 75.4% Hours of shared call per month 175 hrs/month 139 hrs/month Patients attended while on call 73 per month 41 per month Hours spent providing service while on call 56 hrs/month 34 hrs/month Group Practice 68.4% 58.2% Remuneration 90%+ professional income from fee-for-service Preference for fee-for-service mode Preference for blended mode 52.6% 30.8% 40.3% 63.0% 38.1% 29.7% [TABLE END] 1 Barer M. et al. Toward Improved Access to Medical Services for Relatively Underserved Populations: Canadian Approaches, Foreign Lessons. Centre for Health Services and Policy Research, University of British Columbia, May 1999.
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The physician appointment and reappointment process 2016

https://policybase.cma.ca/en/permalink/policy13564
Date
2016-12-03
Topics
Health human resources
Physician practice/ compensation/ forms
  1 document  
Policy Type
Policy document
Date
2016-12-03
Topics
Health human resources
Physician practice/ compensation/ forms
Text
Beginning in the 1990s most jurisdictions established regional health authorities (RHAs) with consolidated medical staff structures and there has been a trend toward requiring all physicians practising in a region to hold an appointment with the RHA in order to access health resources such as diagnostic imaging and laboratory services, irrespective of whether they hold hospital privileges or not. Subsequent to the consolidation of medical staff governance there have been several developments over the past decade that have implications for where and how physicians can practise, and for their ability to advocate freely on behalf of their patients. These include: * the establishment of formal physician resource plans that link the appointment process to the ability to participate in the provincial/territorial medical insurance plan; * a greater focus on clinical governance that includes detailed attention on scope of practice and privileges; * a growing concern about the ability of physicians to advocate on behalf of their patients and the communities they serve; and * an increase in the number of physicians entering into employment or contractual arrangements. The Canadian Medical Association (CMA) puts forward the following recommendations for governments, regulatory authorities, RHAs and medical staff structures within RHAs and hospitals. Recommendations Where physician appointments are to be approved in relation to Physician Resource Plans, the CMA recommends that such plans must: * take into consideration both population need and projected physician supply; * include transparency in the provision of information about available practice opportunities and on the criteria and processes through which applications for appointments are approved; * be based on a documented methodology with results in the public domain; and * be based on a medium-term projection range, using the most current and reliable data available, and be regularly reviewed and updated. The CMA recommends that the application of standardized credential templates must take into consideration the quality of care being provided by the physician and local circumstances such as the complement of medical and hospital resources available locally and the timeliness of proximity to secondary and tertiary care. The CMA strongly supports the implementation of policy to safeguard physicians from fear of reprisal and retaliation when speaking out as advocates for their patients and communities, and the right and duty of medical officers of health to speak publicly to the citizens they serve. The CMA supports provincial/territorial amendments to public health legislation to protect the right and duty of medical officers of health to speak publicly to the citizens they serve without political interference or risk of adverse employment consequences. The CMA believes that medical staff bylaws should expressly extend to physicians under contract entitlement to the procedural protections set out in the hospital or health authority bylaws. The CMA recommends that the processes of granting appointments, reappointments and privileges and allocating resources respect the following principles: 1. All processes should be fair, equitable, documented and transparent and should protect confidentiality. 2. Criteria for reappointment should be clearly specified in medical staff bylaws and should be no more onerous than necessary to verify the ongoing provision of quality care by the medical staff. 3. A regular evaluation of appointed physicians should be conducted by the appropriate clinical chief. 4. The quality of a physician's care is the most important criterion to be considered at the time of appointment, reappointment and the granting of privileges. 5. The information required for the granting of appointments, reappointments or privileges or for the allocation of medical resources must be accurate, valid and appropriate. 6. The processes of granting appointments, reappointments and privileges and allocating resources should recognize and accommodate the changes in practice patterns that may occur over the medical career cycle. 7. Physicians with established community practices have a significant investment in their practice and the community; this investment should be considered at the time of reappointment or change in privileges. 8. A recommendation, without just cause, to withdraw an appointment, to restrict privileges or to significantly reduce resources available to a physician must include appropriate compensation based on individual circumstances. 9. The reporting of legal actions or disciplinary actions as part of the reappointment or reappointment process should be restricted to those matters in which a final determination has been rendered and in which there has been an adverse finding to the physician. Objective This policy outlines the principles that should be considered for the granting of physician appointments, reappointments, privileges and access to resources at the health care facility, district or RHA level. Key definitions Appointment: The process by which a physician joins the medical staff of a health region or health facility in order to access resources to care for patients. Credentialing: An approach to obtaining, verifying and assessing the qualifications of a health professional against consistent criteria for the purposes of licensing and/or granting privileges.1 Privileges: Permission from an authorized body to a health care provider to conduct a specific scope and content of patient care. Privileges are granted based upon an evaluation of the provider's training, experience and competence related to the service, and are specific to a defined practice setting.1 Clinical peer review: The process by which physician peers assess each other's performance. A peer is a physician with relevant clinical experience in similar health care environments who also has the competence to contribute to the review of other physicians' performance.2 Background Historically the formal appointment process applied to physicians wishing to practise in hospitals. Beginning in the 1990s most jurisdictions established RHAs with consolidated medical staff structures and there has been a trend toward requiring all physicians practising in a region to hold an appointment with the RHA in order to access health resources such as diagnostic imaging and laboratory services, irrespective of whether they hold hospital privileges or not. Since the CMA first adopted principles for the physician appointment and reappointment process in 1997 there have been several developments that are reviewed below: * the establishment of formal physician resource plans that link the appointment process to the ability to participate in the provincial/territorial medical insurance plan; * a greater focus on clinical governance that includes detailed attention on scope of practice and privileges; * a growing concern about the ability of physicians to advocate on behalf of their patients and the communities they serve; and * an increase in the number of physicians entering into employment or contractual arrangements. Physician Resource Plans (PRPs): New Brunswick was the first province to require physicians to have privileges with an RHA in order to obtain a billing number.3 More recently jurisdictions such as Nova Scotia (N.S.) have introduced medium to longer range PRPs that are to be used when approving new appointments. In 2012 N.S. released a PRP for 2012-2021, which has since been updated to 2013-2022.4 Under the terms of the Nova Scotia Health Authority Medical Staff Bylaws, the RHA CEO or their designate will assess applications for new appointments in relation to need and availability of resources. The assessment is to be completed within 60 days and there is no right of review or appeal of the CEO's decision.5 Manitoba's medical staff bylaws make a similar provision.6 While Ontario has not regionalized to the same extent as other jurisdictions, legislation has been introduced that proposes to make the 14 Local Health Integration Networks (LHINs) responsible for primary care planning and performance management.7 Moreover the Bill will amend the Health Insurance Act to authorize the health minister to delegate non-fee-for-service physician compensation to the LHIN. Recommendation Where physician appointments are to be approved in relation to PRPs, the CMA recommends that such plans must: * take into consideration both population need and projected physician supply; * include transparency in the provision of information about available practice opportunities and on the criteria and processes through which applications for appointments are approved; * be based on a documented methodology with results in the public domain; and * be based on a medium-term projection range, using the most current and reliable data available, and be regularly reviewed and updated. Other physician resource planning considerations are set out in the CMA's comprehensive policy on PRPs.8 Clinical governance: Since the late 1990s there has been a great deal of attention paid to the concept of clinical governance, which may be defined as the structures, processes and culture needed to ensure that health care organizations and all individuals within them can assure the quality of the care they provide and are continuously seeking to improve it. During the past decade several provinces have carried out inquiries related to problems with pathology and radiology. In British Columbia (B.C.) the Chair of the BC Patient Safety & Quality Council conducted a review of the medical imaging credentialing and quality assurance that reported in 2011. In his final report, Dr. Douglas Cochrane set out 35 recommendations that called for much more rigorous and uniform oversight of medical practice in B.C.9 The recommendations included a call for: * the creation of a single medical staff administration to serve all health authorities and affiliated organizations; * the development of standardized processes for medical staff appointment, and credentialing and privileging, including common definitions; and * the development of performance assessment and review process for all physicians.9 The Cochrane report has resulted in the British Columbia Medical Quality Initiative (BC MQI). BC MQI is implementing an online Provincial Practitioner Credentialing and Privileging System (CACTUS Software) that will be used by all of B.C.'s RHAs to manage these processes for physicians, midwives, dentists and nurse practitioners.10 BC MQI has developed 62 privileging dictionaries for medical directors and department heads to use with their colleagues during initial and renewal privileging processes. The dictionaries recommend the required current experience to perform a certain activity in the form of numbers where applicable and also recommend the requirements for renewal of privileges and the requirements for return to practice. These recommendations are meant to take into account the individual's own experience and the context of the local site in which they work. They are meant to begin a conversation as needed with the department head, colleagues and others. The Society of Rural Physicians of Canada (SRPC) has raised concerns about the potential impact of volume-based credentialing on rural medical practice. For example, the dictionary for Family Practice with Enhanced Surgical Skills recommends that for operative delivery, a volume of at least five caesarean section deliveries be performed per year averaged over 24 months.11The SRPC has put forward recommendations that emphasize the need for appropriate peer review and consideration of geographic diversity and the range of medical practice, and that credential revalidation should be based on the actual quality of care provided by the physician, the continuing medical education completed by the physician and should also consider the impact of changes in delivery on the health outcomes in the community.12 It seems likely that other jurisdictions will be watching the CACTUS program with interest. Recommendation The CMA recommends that the application of standardized credential templates must take into consideration the quality of care being provided by the physician and local circumstances such as the complement of medical and hospital resources available locally and the timeliness of proximity to secondary and tertiary care. Advocacy: Advocacy has been identified as one of seven core roles of every physician by the Royal College of Physicians and Surgeons of Canada13 and the College of Family Physicians of Canada.14 This role entails physicians using their expertise and influence in the interests of their individual patients and the communities and populations they serve. Over the past decade there have been several instances where physicians have either expressed concern about their ability to advocate or have had disciplinary action taken against them, likely as a result of their advocacy activities. As a result of an inquiry carried out by the Health Quality Council of Alberta, the Alberta Medical Association, Alberta Health Services and the College of Physicians and Surgeons of Alberta have adopted a joint policy statement that sets out guidelines for physician advocacy.15 Eastern Health in Newfoundland and Labrador has a privacy/confidentiality oath or affirmation for physicians that acknowledges that they may have professional standards for disclosure and advocacy regarding patient safety, but stipulates the expectation that such concerns be first addressed through Eastern Health as an initial step.16 The CMA's policy on the evolving professional relationship between physicians and the health care system sets out nine factors for physicians to consider before undertaking advocacy.17 As predominantly employees of some level of government, and with a responsibility to sound an alert on population health risks, public health physicians are at greater risk of being disciplined for advocacy. There have been two high profile cases of public health physicians who have been dismissed for advocacy-related activities since 2000. Thus far only B.C. has enacted public health legislation to protect medical officers of health from political interference and adverse employment consequences. B.C.'s Public Health Act stipulates that the provincial health officer (PHO) has a duty to advise on provincial public health issues, which includes public reporting where the PHO believes it will best serve the public interest. Similarly sub-provincial medical health officers must advise on local public health issues and publicly report on them after consultation with the PHO. B.C.'s legislation also provides health officers with immunity from legal proceedings for actions done in good faith in the performance of their duties and for reports they are required to make. In addition the legislation protects health officers from "adverse actions", defined as an action that would either affect or threaten "the personal, financial or other interests of a person, or a relative, dependent, friend or business or other close association of that person" as a result of performing their duties in good faith.18 Recommendations The CMA strongly supports the implementation of policy to safeguard physicians from fear of reprisal and retaliation when speaking out as advocates for their patients and communities, and the right and duty of medical officers of health to speak publicly to the citizens they serve. The CMA supports provincial/territorial amendments to public health legislation to protect the right and duty of medical officers of health to speak publicly to the citizens they serve without political interference or risk of adverse employment consequences. Growing employment/contractual relationships: The move to RHAs, consolidation in the hospital sector and changing delivery models have had significant implications for the relationships between physicians and hospitals. The Canadian Medical Protective Association (CMPA) has identified several areas of concern, including patient advocacy, reporting of physicians, responding to adverse events, collection and use of physician information, practice arrangements and liability provision.19 One issue that the CMPA has highlighted in particular is the increasing trend in some jurisdictions for physicians to be engaged on a contracted employee basis rather than as independent contractors appointed with privileges.20 This is seen among facility-based physicians such as hospitalists, clinical and surgical assistants and laboratory physicians. The CMPA has cautioned that physicians engaged on a contractual basis may not have the same procedural rights on termination of contracts as those engaged under the privileging model and it has issued guidance on issues to consider with individual contracts, including CMPA assistance, indemnification clauses, liability provisions, confidentiality, termination of contract, dispute resolution and governing law.21 Recommendation The CMA believes that medical staff bylaws should expressly extend to physicians under contract entitlement to the procedural protections set out in the hospital or health authority bylaws. Principles Physicians must take a leadership role and be active participants in the development of appointment, reappointment and related processes; medical communities must therefore be aware of the basic principles that should be reflected in these processes. Once a physician has obtained a licence to practice, the process of appointment approval is the next step in obtaining permission to practise medicine in a health care facility, district or region. The next step is the granting of privileges. This bestows the right to perform specific medical acts within the health care facility, district or region. The final step is the provision of the necessary resources so that the physician is able to provide appropriate medical services for patient care. A medical committee with a clear structure and mandate to deal with appointments, reappointments and privileges must be maintained in all health care facilities, districts and regions so that physician input may be given during the appointment, reappointment and related processes. Clinical peer review must be foundational to these processes. Time, training and resources must be sufficient to support consistent peer review processes. The principles proposed below apply to all of the following processes: the appointment and reappointment processes, the granting of privileges and the allocation of health care facility, district or regional resources. Principles for the processes of granting appointments, reappointments and privileges and allocating resources 1. All processes should be fair, equitable, documented and transparent and should protect confidentiality. They should be completed in a timely manner and follow the rules of natural justice. At a minimum, the rules of natural justice give the physician the right to notice and the right to be heard before, and provided with reasons by, an impartial adjudicator. Given the nature of the physician's interests in the appointment, reappointment and other related processes, the following principles should also be included: * the right to be heard, either in person and (or) by representation; * the right to full disclosure of the information being considered by the committee that makes recommendations on appointments, reappointments and privileges; * the right to present evidence; * the right to a hearing free from bias, either real or perceived; * the right to a record of the proceedings; * a decision within a reasonable period; * the right to receive written reasons for the decision; and * the right to an appeal process by an independent and impartial body other than the board of the health care facility, district or region. It is important that all processes, including any review processes, follow the principles of natural justice. These processes should be part of the medical staff bylaws that guide the operation of the health care facility, district or region and should be known to all appointed physicians. 2. Criteria for reappointment should be clearly specified in medical staff bylaws and should be no more onerous than necessary to verify the ongoing provision of quality care by the medical staff. Medical staff appointments are typically for a one-year term. Criteria for reappointment vary across Canada, ranging from the provision of evidence of renewed licensure and liability coverage with a discretionary in-depth performance evaluation to the foregoing plus a mandated in-depth performance evaluation and reporting on continuing professional development activity. 3. A regular evaluation of appointed physicians should be conducted by the appropriate clinical chief. It should consist of a fair, documented process with explicit, agreed-upon criteria for the review of the physician's qualifications and credentials and the quality of care provided. If there is demonstrated inappropriate behaviour or a quality-of-care issue, a program for remediation should be established with regular follow-up over a period deemed appropriate by the physician's peers. As in other jobs, the objective of regular performance evaluations for a physician is to improve the physician's performance and the focus should be on opportunities for learning and improvement. The appraisal should entail a standardized peer evaluation process, in addition to self-assessment. The self-assessment process should include the recognition of satisfactory existing skills and the identification of new skills to be learned. In some situations remediation may be justified, for example when there is a need to upgrade skills, when interpersonal and communication skills are unacceptable, and when there is alcohol or drug abuse. Physician evaluations conducted by RHAs should take into account requirements already asked of the physician by their certifying and/or licensing body or other speciality organization in order to avoid duplication of effort. Looking ahead, with the increasing focus on team-based collaborative care, performance of team function and its impact on overall performance to meet health service requirements and quality of care is expected to become increasingly relevant. Conflict resolution mechanisms, scopes of practice and shared roles and responsibilities will need to be considered in order to assess individual and team performance. 4. The quality of a physician's care is the most important criterion to be considered at the time of appointment, reappointment and the granting of privileges. Quality care may be defined as the provision of service that satisfies the needs of the patient and meets the standards set out by recognized bodies of the profession, such as licensing bodies, national clinical societies and others. The essential components of quality include competence, accessibility, acceptability, effectiveness, appropriateness, efficiency, affordability and safety. The cost of a physician's care should not be the primary criterion considered during appointment, reappointment and related processes. Practice patterns, resulting in differences in cost of care, will differ for numerous reasons, including severity of illness, patient mix and patient choices. If there is a local, regional or district physician resource plan, then the need for a particular physician skill base as identified in the plan is an important criterion for appointment or reappointment to institutions within the plan. Physicians must be involved in the development of such a plan, and the plan must be supported by physicians at the local, district or regional level. If a practice and remuneration plan is introduced for a facility, hospital or academic health sciences centre, then participation in such a plan should not be a criterion for reappointment. 5. The information required for the granting of appointments, reappointments or privileges or for the allocation of medical resources must be accurate, valid and appropriate. The information required for these purposes should generally be limited to that which is reasonably necessary to determine the physician's ability to provide safe care. Physician's privacy should only be violated if it is determined that a medical condition or other disability poses an unacceptable risk to patients. The physician's credentials, skills, expertise and quality of care, as judged by peer assessment, should be considered during the appointment or reappointment process. Utilization data and associated indicators are being used more frequently as criteria for appointment and reappointment. Therefore, physicians must be involved in the development of such indicators, and there must be agreement by all parties on the type and quality of data or indicators to be used. In addition, before appointment or reappointment, physicians must be made aware of the data or indicators that will be used to evaluate them and the criteria by which these indicators will be applied. 6. The processes of granting appointments, reappointments and privileges and allocating resources should recognize and accommodate the changes in practice patterns that may occur over the medical career cycle. These processes should be flexible and reasonable concerning other issues such as on-call responsibilities or time needed to fulfil research and teaching commitments. It is important to recognize that a physician's practice pattern may change during his or her medical career. These changes may reflect the desire to no longer take call, the narrowing of the physician's practice to achieve a higher level of expertise in a specific area or the desire to pursue academic interests or responsibilities. Pregnancy, parental leave and the wish to practice part-time must also be considered. The quality of a physician's personal life and other special needs should be viewed as important and should be considered by those making decisions in these areas. 7. Physicians with established community practices have a significant investment in their practice and the community; this investment should be considered at the time of reappointment or change in privileges. An established physician may face financial loss if he or she is not reappointed or if there is a recommendation to substantially change his or her privileges. This possibility should be considered at the time of reappointment or change in privileges. 8. A recommendation, without just cause, to withdraw an appointment, to restrict privileges or to significantly reduce resources available to a physician must include appropriate compensation based on individual circumstances. Appropriate compensation includes financial restitution, retraining, relocation assistance and counselling assistance as required. Sufficient notice and other elements of due process should also be components of this recommendation. Generally, physicians are not employees of a health care facility, district or regional authority. Nonetheless, there are often extensive restrictions on physician mobility and limited opportunities to practice both inside and outside a province or territory. Age may also be a factor in the ability to find placement elsewhere, particularly if the physician is nearing retirement age. For these reasons, an interruption or cessation of a physician's career caused by withdrawal of an appointment, restriction of privileges or reduction in the resources available to the physician justifies appropriate compensation and due notice; this is in keeping with good human resource practices. Appropriate notice should be provided to physicians so that there is minimal impact on patient care. What constitutes timely and appropriate notice may in some cases be several months and will differ depending on the impact of the decision. Examples of decisions that could have a significant impact on physicians include: * temporary or permanent closure of operating rooms or other facilities; * strategic redirection of the hospital that may adversely affect a particular medical service or department, such as regionalization of laboratory testing or provincial centralization of a specialized service; and * implementation of a retirement policy. 9. The reporting of legal actions or disciplinary actions as part of the reappointment or reappointment process should be restricted to those matters in which a final determination has been rendered and in which there has been an adverse finding to the physician. References 1 Accreditation Canada. Qmentum Standards. Governance. Ottawa: Accreditation Canada; 2016. 2 Australian Commission on Safety and Quality in Healthcare. Review by peers: a guide for professional, clinical and administrative processes. Sydney: Australian Commission on Safety and Quality in Health Care; July 2010. Available: http://www.safetyandquality.gov.au/wp-content/uploads/2012/01/37358-Review-by-Peers.pdf (accessed 2016 May 02). 3 New Brunswick Department of Health. Registration requirements. Fredericton: New Brunswick Department of Health; 2016. Available: http://www.gnb.ca/0394/prw/RegistrationRequirements-e.asp (accessed 2016 May 02). 4 Nova Scotia Department of Health and Wellness. Shaping our Physician Workforce. Updates. Halifax: Nova Scotia Department of Health and Wellness; 2016. Available: http://novascotia.ca/dhw/shapingPhysicianWorkforce/updates.asp (accessed 2016 May 02). 5 Province of Nova Scotia. Nova Scotia Health Authority Medical Staff Bylaws. Halifax: Province of Nova Scotia; April 2015. Available: https://www.novascotia.ca/just/regulations/regs/hamedstaff.htm (accessed 2016 May 02). 6 Winnipeg Regional Health Authority. WRHA Board By-Law No.3 Medical Staff. Winnipeg: Winnipeg Regional Health Authority; March 2014. Available: http://www.wrha.mb.ca/extranet/medicalstaff/files/MedByLaw.pdf (accessed 2016 May 02). 7 Bill 41. An Act to amend various Acts in the interests of patient-centred care. 2nd Sess, 41st Leg, Ontario; 2016. Available: http://www.ontla.on.ca/bills/bills-files/41_Parliament/Session2/b041.pdf (accessed 2016 Nov 07). 8 Canadian Medical Association. Physician resource planning. Updated 2015. Ottawa: The Association; 2015. Available: http://policybase.cma.ca/dbtw-wpd/Policypdf/PD15-07.pdf (accessed 2016 May 02). 9 Cochrane DD. Investigation into medical imaging, credentialing and quality assurance. Phase 2 report. Vancouver: BC Patient Safety & Quality Council; Aug 2011. Available: http://www.health.gov.bc.ca/library/publications/year/2011/cochrane-phase2-report.pdf (accessed 2016 May 02). 10 British Columbia Medical Quality Initiative. Briefing note: BC MQI - Provincial Practitioner Credentialing and Privileging System (CACTUS Software) Implementation. Vancouver: British Columbia Medical Quality Initiative; January 2016. Available: http://bcmqi.ca/wp-content/uploads/Briefing-Note_ProvincialPractitionerCPSystemImplementation.pdf (accessed 2016 May 02). 11 British Columbia Medical Quality Initiative. Family Practice with Enhanced Surgical Skills Clinical Privileges. Vancouver: British Columbia Medical Quality Initiative; March 2015. Available: http://www.srpc.ca/ess2016/summit/FamilyPracticeEnhancedSurgicalSkills.pdf (accessed 2016 Nov 06). 12 Soles H, Larsen Soles T. SRPC position statement on minimum-volume credentialing. Can J Rural Med. 2016;21(4):107-11. 13 Royal College of Physicians and Surgeons of Canada. CanMEDS 2015. Physician competency framework. Ottawa: Royal College of Physicians and Surgeons of Canada; 2015. Available: http://canmeds.royalcollege.ca/uploads/en/framework/CanMEDS%202015%20Framework_EN_Reduced.pdf (accessed 2016 May 02). 14 College of Family Physicians of Canada. CanMEDS-Family Medicine. Working Group on Curriculum Review. Mississauga: College of Family Physicians of Canada; October 2009. Available: http://www.cfpc.ca/uploadedFiles/Education/CanMeds%20FM%20Eng.pdf (accessed 2016 May 02). 15 Alberta Medical Association, Alberta Health Services, College of Physicians and Surgeons of Alberta. Advocacy Policy Statement. Edmonton: Alberta Medical Association; 2015. Available: https://www.albertadoctors.org/Advocacy/Policy_Statement.pdf (accessed 2016 May 02). 16 Eastern Health. Privacy and confidentiality. ADM-030. St. John's, NL: Eastern Health; 2015. Available: http://www.easternhealth.ca/OurServices.aspx?d=2&id=743&p=740 (accessed 2016 Jun 23). 17 Canadian Medical Association. The evolving professional relationship between Canadian physicians and our evolving health care system: where do we stand? Ottawa: The Association; 2012. Available: https://www.cma.ca/Assets/assets-library/document/en/advocacy/policy-research/CMA_Policy_The_evolving_professional_relationship_between_Canadian_physicians_and_our_health_care_system_PD12-04-e.pdf (accessed 2016 May 02). 18 Public Health Act. SBC 2008, Chapter 28. Available: http://www.bclaws.ca/civix/document/id/complete/statreg/08028_01 (accessed 2016 Nov 07). 19 Canadian Medical Protective Association. Changing physician-hospital relationships: Managing the medico-legal implications of change. Ottawa: The Association; 2011. Available: https://www.cmpa-acpm.ca/-/changing-physician-hospital-relationships (accessed 2016 Nov 07). 20 Canadian Medical Protective Association. The changing practice of medicine: employment contracts and medical liability. Ottawa: The Association; 2012. Available: https://www.cmpa-acpm.ca/-/the-changing-practice-of-medicine-employment-contracts-and-medical-liability (accessed 2016 Nov 07). 21 Canadian Medical Protective Association. Medical-legal issues to consider with individual contracts. Ottawa: The Association; 2016. Available: https://www.cmpa-acpm.ca/-/medico-legal-issues-to-consider-with-individual-contracts (accessed 2016 Nov 07).
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Avoiding negative consequences to health care delivery from federal taxation policy

https://policybase.cma.ca/en/permalink/policy11957
Date
2016-08-31
Topics
Health human resources
Physician practice/ compensation/ forms
  1 document  
Policy Type
Response to consultation
Date
2016-08-31
Topics
Health human resources
Physician practice/ compensation/ forms
Text
The Canadian Medical Association (CMA) provides this submission in response to Finance Canada’s consultation on Legislative Proposals Relating to Income Tax, Sales Tax and Excise Duties (Draft Tax Legislative Proposals). The CMA is the national voice of Canadian physicians. On behalf of its more than 83,000 members and the Canadian public, the CMA’s mission is helping physicians care for patients. In fulfillment of this mission, the CMA’s role is focused on national, pan-Canadian health advocacy and policy priorities. As detailed in this brief, the CMA is gravely concerned that by capturing group medical structures in the application of Clause 13 of the Draft Tax Legislative Proposals, the federal government will inadvertently negatively affect medical research, medical training and education as well as access to care. To ensure that the unintended consequences of this federal tax policy change do not occur, the CMA is strongly recommending that the federal government exempt group medical and health care delivery from the proposed changes to s.125 of the Income Tax Act regarding multiplication of access to the small business deduction in Clause 13 of the Draft Tax Legislative Proposals. Relevance of the Canadian Controlled Private Corporation Framework to Medical Practice Canada’s physicians are highly skilled professionals, providing an important public service and making a significant contribution to our country’s knowledge economy. Due to the design of Canada’s health care system, a large majority of physicians – more than 90% – are self-employed professionals and effectively small business owners. As self-employed small business owners, physicians typically do not have access to pensions or health benefits, although they are responsible for these benefits for their employees. Access to the Canadian-Controlled Private Corporation (CCPC) framework and the Small Business Deduction (SBD) are integral to managing a medical practice in Canada. It is imperative to recognize that physicians cannot pass on any increased costs, such as changes to CCPC framework and access to the SBD, onto patients, as other businesses would do with clients. In light of the unique business perspectives of medical practice, the CMA strongly welcomed the federal recognition in the 2016 budget of the value that health care professionals deliver to communities across Canada as small business operators. Contrary to this recognition, the 2016 budget also introduced a proposal to alter eligibility to the small business deduction that will impact physicians incorporated in group medical structures. What’s at risk: Contribution of group medical structures to health care delivery The CMA estimates that approximately 10,000 to 15,000 physicians will be affected by this federal taxation proposal. If implemented, this federal taxation measure will negatively affect group medical structures in communities across Canada. By capturing group medical structures, this proposal also introduces an inequity amongst incorporated physicians, and incentivizes solo practice, which counters provincial and territorial health delivery priorities. Group medical structures are prevalent within academic health science centres and amongst certain specialties, notably oncology, anaesthesiology, radiology, and cardiology. Specialist care has become increasingly sub-specialized. For many specialties, it is now standard practice for this care to be provided by teams composed of numerous specialists, sub-specialists and allied health care providers. Team-based care is essential for educating and training medical students and residents in teaching hospitals, and for conducting medical research. Put simply, group medical structures have not been formed for taxation or commercial purposes. Rather, group medical structures were formed to deliver provincial and territorial health priorities, primarily in the academic health setting, such as teaching, medical research as well as optimizing the delivery of patient care. Over many years, and even decades, provincial and territorial governments have been supporting and encouraging the delivery of care through team-based models. To be clear, group medical structures were formed to meet health sector priorities; they were not formed for business purposes. It is equally important to recognize that group medical structures differ in purpose and function from similar corporate or partnership structures seen in other professions. Unlike most other professionals, physicians do not form these structures for the purpose of enhancing their ability to earn profit. It is critical for Finance Canada to acknowledge that altering eligibility to the small business deduction will have more significant taxation implication than simply the 4.5% difference in the small business versus general rate at the federal level. It would be disingenuous for Finance Canada to attempt to argue that removing full access to the small business deduction for incorporated physicians in group medical structures will be a minor taxation increase. As taxation policy experts, Finance Canada is aware that this change will impact provincial/territorial taxation, as demonstrated below in Table 1. Table 1: Taxation impacts by province/territory, if the federal taxation proposal is implemented In Nova Scotia, for example, approximately 60% of specialist physicians practice in group medical structures. If the federal government applies this taxation proposal to group medical structures, these physicians will face an immediate 17.5% increase in taxation. In doing so, the federal government will establish a strong incentive for these physicians to move away from team-based practice to solo practice. If this comes to pass, the federal government may be responsible for triggering a reorganization of medical practice in Nova Scotia. Excerpts from physician communiques The CMA has received as well as been copied on a significant volume of correspondence from across our membership conveying deep concern with the federal taxation proposal. To provide an illustration of the risks of this proposal to health care, below are excerpts from some of these communiques:
“Our Partnership was formed in the 1970s…The mission of the Partnership is to achieve excellence in patient care, education and research activities….there would be a serious adverse effect on retention and recruitment if members do not have access to the full small business deduction…The changes will likely result in pressure to dissolve the partnership and revert to the era of departments services by independent contractors with competing individual financial interests.” Submitted to the CMA April 15, 2016 from a member of the Anesthesia Associates of the Ottawa Hospital General Campus
“The University of Ottawa Heart Institute is an academic health care institution dedicated to patient care, research and medical education…To support what we call our “academic mission,” cardiologists at the institute have formed an academic partnership…If these [taxation] changes go forward they will crippled the ability of groups such as ours to continue to function and will have a dramatic negative impact on medical education, innovative health care research, and the provision of high-quality patient care to our sickest patients.” Submitted to the CMA April 19, 2016 from a member of the Associates in Cardiology
“We are a general partnership consisting of 93 partners all of whom are academic anesthesiologists with appointments to the Faculty of the University of Toronto and with clinical appointments at the University Health Network, Sinai Health System or Women’s College Hospital…In contrast to traditional business partnerships, we glean no business advantage whatsoever from being in a partnership…the proposed legislation in Budget 2016 seems unfair in that it will add another financial hardship to our partners – in our view, this is a regressive tax on research, teaching and innovation.” Submitted to the CMA April 14, 2016 from members of the UHN-MSH Anesthesia Associates Recommendation The CMA recommends that the federal government exempt group medical and health care delivery from the proposed changes to s.125 of the Income Tax Act regarding multiplication of access to the small business deduction, as proposed in Clause 13 of the Draft Tax Legislative Proposals. Below is a proposed legislative amendment to ensure group medical structures are exempted from Clause 13 of the Draft Tax Legislative Proposals: Section 125 of the Act is amended by adding the following after proposed subsection 125(9): 125(10) Interpretation of designated member – [group medical partnership] – For purposes of this section, in determining whether a Canadian-controlled private corporation controlled directly or indirectly in any manner whatever by one or more physicians or a person that does not deal at arm's length with a physician is a designated member of a particular partnership in a taxation year, the term "particular partnership" shall not include any partnership that is a group medical partnership. 125(11) Interpretation of specified corporate income – [group medical corporation] – For purposes of this section, in determining the specified corporate income for a taxation year of a corporation controlled directly or indirectly in any manner whatever by one or more physicians or a person that does not deal at arm's length with a physician, the term "private corporation" shall not include a group medical corporation. Subsection 125(7) of the Act is amended by adding the following in alphabetical order: "group medical partnership" means a partnership that: (a) is controlled, directly or indirectly in any manner whatever, by one or more physicians or a person that does not deal at arm's length with a physician; and (b) earns all or substantially all of its income for the year from an active business of providing services or property to, or in relation to, a medical practice; "group medical corporation" means a corporation that: (a) is controlled, directly or indirectly in any manner whatever, by one or more physicians or a person that does not deal at arm's length with a physician; and (b) earns all or substantially all of its income for the year from an active business of providing services or property to, or in relation to, a medical practice. "medical practice" means any practice and authorized acts of a physician as defined in provincial or territorial legislation or regulations and any activities in relation to, or incidental to, such practice and authorized acts; "physician" means a health care practitioner duly licensed with a provincial or territorial medical regulatory authority and actively engaged in practice;
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Appropriateness in health care

https://policybase.cma.ca/en/permalink/policy11897
Date
2016-08-24
Topics
Health human resources
Resolution
GC16-26
The Canadian Medical Association calls for emphasis on considerations of appropriateness in health care as part of the medical school curriculum.
Policy Type
Policy resolution
Date
2016-08-24
Topics
Health human resources
Resolution
GC16-26
The Canadian Medical Association calls for emphasis on considerations of appropriateness in health care as part of the medical school curriculum.
Text
The Canadian Medical Association calls for emphasis on considerations of appropriateness in health care as part of the medical school curriculum.
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Emergency health services

https://policybase.cma.ca/en/permalink/policy11914
Date
2016-08-24
Topics
Health systems, system funding and performance
Health human resources
Ethics and medical professionalism
Resolution
GC16-43
The Canadian Medical Association supports initiatives to enhance the capacity of primary care physicians to provide emergency health services during and after disasters.
Policy Type
Policy resolution
Date
2016-08-24
Topics
Health systems, system funding and performance
Health human resources
Ethics and medical professionalism
Resolution
GC16-43
The Canadian Medical Association supports initiatives to enhance the capacity of primary care physicians to provide emergency health services during and after disasters.
Text
The Canadian Medical Association supports initiatives to enhance the capacity of primary care physicians to provide emergency health services during and after disasters.
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Reducing barriers to physician mobility and for a more uniformed healthcare system in Canada

https://policybase.cma.ca/en/permalink/policy11850
Date
2016-05-12
Topics
Health human resources
  1 document  
Policy Type
Parliamentary submission
Date
2016-05-12
Topics
Health human resources
Text
On behalf of 83,000 physician members, the Canadian Medical Association (CMA) welcomes this opportunity to provide input to the Standing Senate Committee on Banking, Trade and Commerce study on internal barriers to trade. For the purposes of this brief, an internal barrier to trade is any regulation or policy that restricts mobility or otherwise creates a perverse incentive for mobility. Basic Facts on the Canadian Physician Workforce The physician workforce in Canada has always been a mobile one. As of January 2016, just over one in four (26%) licensed physicians who graduated from one of Canada’s 17 medical schools was practising in a different province from the one where they obtained their medical degree.1 It might be added that only 8 of Canada’s 13 provinces and territories have medical schools. Another important dimension of mobility is the fact that Canada continues to rely to a significant degree on the medical services provided by International Medical Graduates (IMGs). Presently, IMGs represent 24% of practising physicians in Canada, and this figure has remained steady over the past two decades (and previously) despite significant increases in medical enrolment.1 A key reason for this dependence is that Canada trains fewer physicians relative to population than other developed countries. According to the Organization for Economic Cooperation and Development (OECD), in 2013, Canada ranked 28th out of 34 member countries in terms of medical graduates per 100,000 population; at 7.5 graduates per 100,000, Canada was one-third below the OECD average of 11.1.2 Another key consideration of the physician workforce in Canada is that beyond the tuition that medical students pay at the undergraduate level, it is virtually exclusively publicly funded. By way of illustration, in 2012, 99% of physician professional incomes came from the public purse in Canada, compared to an average of 72% for the 22 OECD countries for which data were available.3 1 Canadian Medical Association Physician Masterfile, January 2016. 2 Organization for Economic Cooperation and Development. OECD Health Statistics, 2015. http://stats.oecd.org/Index.aspx?DataSetCode=HEALTH_REAC. Accessed 05/05/16. 3 Organization for Economic Cooperation and Development. OECD. Stat. Accessed 05/05/16. 4 Internal Trade Secretariat. Agreement on Internal Trade. http://www.ait-aci.ca/agreement-on-internal-trade/. Accessed 05/05/16. 5 Federation of Medical Licensing Authorities of Canada, Association of Canadian Medical Colleges, Medical Council of Canada. Licensure, postgraduate training and the Qualifying Examination. Can Med Assoc J 1992;146(3):345. 6 Federation of Medical Regulatory Authorities of Canada. Model standards for medical registration in Canada. Ottawa, 2016. 7 Federal/Provincial/Territorial Advisory Committee on Health Delivery and Human Resources. Report of the Canadian Task Force on Licensure of International Medical Graduates. Ottawa, 2004. 8 Medical Council of Canada. Practice-ready assessment. http://mcc.ca/about/collaborations-and-special-projects/practice-ready-assessment/. Accessed 05/08/16. 9 Canadian Heritage. The Canadian Charter of Rights and Freedoms. http://publications.gc.ca/collections/Collection/CH37-4-3-2002E.pdf. Accessed 05/08/16. 10 Canada. Canada Health Act R.S.C., 1985, c. C-6. http://laws-lois.justice.gc.ca/PDF/C-6.pdf. Accessed 05/08/16. 11 Canadian Institute for Health Informaiton. Prescribed drug spending in Canada, 2013: a focus on public drug programs. https://secure.cihi.ca/free_products/Prescribed%20Drug%20Spending%20in%20Canada_2014_EN.pdf. Accessed 05/08/16. National Standards for Eligibility for Licensure The medical profession was well out in front of the 1994 Agreement on Internal Trade (AIT) and its objective in Chapter Seven of eliminating or reducing measures maintained by the provinces and territories that restrict or impair labour mobility in Canada.4 In 1992, the Federation of Medical Licensing Authorities of Canada, the Association of Canadian Medical Colleges and the Medical Council of Canada adopted a standard for portable eligibility of licensure in all provinces except Quebec.5 When the AIT was revisited in the late 2000s, the Federation of Medical Regulatory Authorities of Canada (FMRAC) worked on the development of an agreement on national standards that was endorsed in all jurisdictions in 2009. This has continued to evolve, and presently, the Model Standards for Medical Registration in Canada set out the: . Canadian standard for full licensure; . route from a provisional license to a full license (which would apply to most IMGs that do not come through the post-MD system in Canada); and . requirements for provisional licensure.6 The result of this effort is that the number of different medical licences in Canada has been reduced from more than 140 to fewer than 5. Since the early 2000s the federal government has played a strong leadership role in assisting the professions to come into compliance with the labour mobility provisions of the AIT. In the case of the medical profession, the key issue has been the mobility of IMGs. In 2002, the federally funded Advisory Committee on Health Delivery and Human Resources established the Task Force on Licensure of International Medical Graduates, which brought together representatives from national and provincial/territorial health ministries, medical regulatory and certifying bodies and medical schools with a mandate to aid in the integration of IMGs into the Canadian medical workforce. The recommendations in the 2004 final report of the Task Force essentially set out a workplan that has resulted in considerable progress on several initiatives.7 Federal funding through programs such as Employment and Social Development Canada’s (ESDC) Foreign Credential Recognition Program and Health Canada’s Internationally Educated Health Care Professional Program, in addition to significant investments by the medical bodies themselves, has contributed to several successful initiatives on the part of the Medical Council of Canada (MCC) and FMRAC and its provincial/territorial members. These have included: . $3.5 million from Health Canada to MCC to develop programs to facilitate the integration of IMGs into the physician workforce such as the National Assessment Collaboration examination, a standardized examination that assesses the readiness of an IMG for entrance into the Canadian post-MD training system; . $8.4 million from Human Resources and Skills Development Canada/ESDC to MCC to streamline and standardize the processes of application for medical licensure and to develop physiciansapply.ca, a single electronic web-based application process for registration with each of the 13 medical regulatory authorities; and . $6.7 million from ESDC to MCC to develop a more flexible MCC Qualifying Examination Part I that can be administered internationally, which will enable IMGs thinking of immigrating to Canada to assess whether they have one of the requirements for full licensure. The work to date has contributed significantly to the integration of IMGs but much remains to be done. Many IMGs enter practice in Canada without entering the post-MD system through a process of provisional licensure. One process that jurisdictions have developed over the past decade to facilitate this route to practice is called Practice Ready Assessment (PRA). PRA is an assessment process to determine if an IMG is able to provide safe medical care to the Canadian public under provisional licensure. This consists of a period of practice under supervised direct observation of a licensed physician in a clinical setting with patients. This has the advantage of expediting the process of assessment to approximately 12 weeks versus 2+ years in a residency program. To the present, PRA programs have been developing in a non-standardized way across jurisdictions. With support from Health Canada, an initiative is underway at the MCC with collaboration from FMRAC, the regulatory bodies, the certifying colleges and provincial IMG assessment programs to develop a pan-Canadian PRA program.8 The goal of this program is to address pan-Canadian specialty areas of need, including family medicine, psychiatry and internal medicine. The elements of this program will include: . IMG candidate orientation to the Canadian health care context; . identification of core competency for each specialty; . clinical assessor training; . standardized assessment tools; and . guidelines. This initiative is presently in the implementation phase, and the plan includes development of additional work-based assessment tools.i i For further information contact MCC – www.mcc.ca or FMRAC – www.fmrac.ca Recommendation one: The Canadian Medical Association recommends that the federal government continue to support the Medical Council of Canada and the Federation of Medical Regulatory Authorities of Canada in the implementation of a pan-Canadian Practice Ready Assessment Program for International Medical Graduates and the development of work-based assessment tools. Mobility and Medicare The right of Canadian citizens and permanent residents to move freely and pursue a livelihood in any jurisdiction is set out in the 1982 Canadian Charter of Rights and Freedoms.9 This is supported in the objectives of the AIT that refer to an “open domestic market” and “free movement of persons”. 4 This is certainly the spirit in which Canada’s Medicare program was established, beginning in the 1950s, and which has now come to be regarded as a much-cherished basic right by Canadians. The preamble of the 1984 Canada Health Act (CHA) includes the objective “to facilitate reasonable access to health services without financial or other barriers”, and portability of health insurance from one jurisdiction to another is one of five criteria for eligibility for federal funding (subject to a three month waiting period in which benefits are paid for by the originating jurisdiction).10 However, the letter of the CHA defines insured health services as “hospital services, physician services and surgical-dental services provided to insured services”10 and that is how it continues to be interpreted by the provinces and territories. An issue that has been identified in many recent reports is the uneven access to prescription drugs. The Canadian Institute for Health Information (CIHI) has estimated that in 2014, the federal and provincial governments accounted for 42% of prescription drug spending, with the majority accounted for by private insurance (36%) or out-of-pocket (22%) spending.11 There is wide variation in public per capita spending on prescription drugs across the provinces. In 2015, CIHI has estimated that expenditure ranged from $219 in British Columbia and $256 in Prince Edward Island (PEI) to $369 in Saskatchewan and $441 in Quebec.12 Even more striking variation is evident when looking at household out-of-pocket spending on prescription drugs by income quintile. Statistics Canada’s 2014 Survey of Household Spending shows that the poorest one-fifth (lowest income quintile) of PEI households spent more than twice as much ($645) on prescription drugs than the poorest one-fifth in Ontario ($300).13 Aside from overall differences in public spending, there are also differences in which drugs are covered, particularly in the case of cancer drugs. For example, the Cancer Advocacy Coalition of Canada reported in 2014 that in Ontario and Atlantic Canada, cancer drugs that must be taken in a hospital setting and are on the provincial formulary are fully funded by the provincial government; if the drug is taken outside of hospital (oral or injectable), however, the patient and family may have to pay significant costs out-of-pocket.14 More generally, the Canadian Cancer Society has reported that persons moving from one province to another may find that a drug covered in their former province may not be covered in the new one. 15 12 Canadian Institute for Health Information. National Health Expenditure Database 1975 to 2015. Table A.3.1.1. https://www.cihi.ca/en/spending-and-health-workforce/spending/national-health-expenditure-trends. Accessed 05/08/14. 13 Statistics Canada. CANSIM Table 2013-0026 Survey of household spending (SHS), household spending, by age of reference person. Accessed 03/27/16. 14 Cancer Advocacy Coalition of Canada. 2014-15 Report Card on Cancer in Canada. http://www.canceradvocacy.ca/reportcard/2014/Report%20Card%20on%20Cancer%20in%20Canada%202014-2015.pdf. Accessed 05/08/16. 15 Canadian Cancer society. Cancer drug access for Canadians. http://www.colorectal-cancer.ca/IMG/pdf/cancer_drug_access_report_en.pdf. Accessed 05/08/16. 16 Ipsos Reid. Supplementary health benefits research. Final report, 2012. 17 Conference Board of Canada. Federal policy action to support the health care needs of Canada’s aging population. https://www.cma.ca/Assets/assets-library/document/en/advocacy/conference-board-rep-sept-2015-embargo-en.pdf. Accessed 05/08/16. 18 Hall E. Canada’s national-provincial health program for the 1980’s ‘A commitment for renewal’. 1980. 19 Canada. Statutes of Canada 2012 Chapter 19. http://laws-lois.justice.gc.ca/PDF/2012_19.pdf. 20 Canadian Medical Association. Submission to the Minister of Finance: Small Business Perspectives of Medical Practice in Canada. https://www.cma.ca/Assets/assets-library/document/en/advocacy/submissions/cma-brief-medical-practice-as-small-business-march-17-2016.pdf Another consequence of the “patchwork quilt” of prescription drug coverage in Canada is the potential for “job lock” among those with employer sponsored benefits. Research carried out by Ipsos Reid for the CMA in 2012 among Canadian adults found that 51% of respondents had employer-sponsored supplementary benefits, with almost all of them reporting prescription drug coverage. Among those with employer benefits, just over four in 10 (42%) indicated that their employer benefits program would be a factor in whether or not they would switch jobs.16 Uneven access to and coverage of prescription drugs across Canada raises two concerns with respect to population mobility. On one hand, there could be a temptation to move to another jurisdiction with better access and coverage, and on the other, there could be a reluctance to move to another jurisdiction for fear of lesser access and coverage. Uncertainty about health care coverage should not be a factor in Canadians’ decisions about where they choose to live and work. One concrete step that the federal government could take to mitigate these concerns would be to introduce a program of drug coverage that would cap high out-of-pocket drug costs for individual Canadians. In 2015, the Conference Board of Canada conducted research for the CMA to estimate the cost of a drug program that would cover prescription drug costs that are greater than either $1,500 per year or 3% of household income (so-called catastrophic costs). They estimated that this would cost the federal government $1.6 billion in 2016.17 Recommendation two: As a positive step toward comprehensive, universal coverage for prescription medication, the Canadian Medical Association recommends that the federal government establish a new program for catastrophic coverage of prescription medication. The Canada Health Act and Physician Mobility In his 1979 review of the Medicare program that led to the CHA, Justice Emmett Hall clearly recognized the power imbalance of the shift to an exclusive public payer for physician services, stating “I reject totally the idea that physicians must accept what any given Province may decide unilaterally to pay. I reject too, as I did in the report of the Royal Commission, the concept of extra-billing.” Justice Hall’s recommended solution to this imbalance was provision for that “when negotiations fail and an impasse occurs, the issues in dispute must be sent to binding arbitration, to an arbitration board consisting of three persons, with an independent chairperson to be named by the chief justice of the relevant Province and one nominee from the profession and one from the Government”.18 Provision for reasonable compensation was built into the CHA in sections 12 (1) and (2). In most jurisdictions, bargaining disputes between the government and the medical association over the amounts that physicians should be paid are subject to a binding dispute resolution mechanism that includes some form of arbitration, as Justice Hall envisioned. However, in Ontario, the physicians have been without a contract since March 31, 2014, and Nova Scotia has given Royal Assent to, but not yet proclaimed the Public Services Sustainability (2015) Act, which suspends the right of the medical association (Doctors Nova Scotia) to arbitration. As noted in the basic facts enumerated above, Canadian physicians are highly mobile, but they should not be motivated to move on the basis of unfair treatment by the government, as is currently the case in Ontario. There is recent precedent for amending the CHA. In 2012, the Jobs, Growth and Long-term Prosperity Act amended the CHA to remove members of the Royal Canadian Mounted Police from the list of exclusions of insured persons.19 Recommendation three: The Canadian Medical Association recommends that Section 12(2) of the Canada Health Act be amended to require: (a) Provincial and territorial governments to enter into an agreement with the provincial/territorial organization(s) that represent(s) practising medical practitioners in the province; and (b) The settlement of disputes relating to compensation through, at the option of the provincial/territorial organization(s) referred to in paragraph (a), conciliation or binding arbitration that is equally representative of the provincial/territorial organization(s) and the province/territory and that has an independent chairperson, to satisfy the “reasonable compensation” criterion in s. 12(1)(c) of the Act for full federal funding. Incorporation Eligibility and Access to the Small Business Deduction A significant proportion of Canada’s physicians are self-employed, small business owners, whose medical practices are incorporated as Canadian-Controlled Private Corporations (CCPCs). The ability to incorporate and access to the small business taxation rate play an important role in the allocation of resources in Canada’s health care system. As explained in the CMA’s recent submission to the Minister of Finance20, incorporation eligibility for medical professionals has been advanced by provincial governments to support the achievement of health policy objectives and, in part, to level the playing field with other self-employed individuals. The CMA strongly welcomed the federal government’s recognition in the budget of the contribution of health care practitioners as small businesses. However, the CMA has significant concerns with the proposed amendments (clause 54 of the Notice of Ways and Means Motion to Amend the Income Tax Act and Other Tax Legislation) to alter eligibility to the small business deduction. It is not clear whether these measures will impact group medical structures. The results of a recent survey by the CMA of its membership confirms that the CCPC framework provides a critical tax equity measure that recognizes the unique challenges they face as small business owners and is critical to the operation of the practice model, particularly supporting community-based care. In some cases, the practice model is only economical within this framework. An important fact is that unlike other small business owners, physicians cannot pass on any increases in compliance or operating costs to patients, given the design of Canada’s public health care system. Of significance to the committee’s study on internal trade, approximately 26% of survey respondents indicated that they would be very or somewhat likely to relocate to another provincial/territorial jurisdiction (26%) or to the U.S. or another country (22%) if they were no longer able to incorporate under the CCPC framework. Recommendation four: Given the potential for negative unintended consequences, such as rendering group medical structures economically unviable or introducing perverse incentives for mobility, particularly out of country, the Canadian Medical Association strongly encourages the federal government to provide clarification regarding the 2016 budget measures with regard to the Canadian-Controlled Private Corporation framework.
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Small business perspectives of physician medical practices in Canada

https://policybase.cma.ca/en/permalink/policy11846
Date
2016-03-21
Topics
Physician practice/ compensation/ forms
Health human resources
  1 document  
Policy Type
Parliamentary submission
Date
2016-03-21
Topics
Physician practice/ compensation/ forms
Health human resources
Text
The Canadian Medical Association (CMA) is the national voice of Canada's doctors, representing more than 83,000 physicians across all regions in the country. With this brief, the CMA provides a portrait of medical practice as small businesses in Canada. A significant proportion of Canada's physicians are self-employed, small business owners, whose medical practices are incorporated as Canadian-Controlled Private Corporations (CCPCs). Reflecting the significance of the CCPC framework to medical practice in Canada, the CMA strongly supports the federal government's commitment to reduce the small business taxation rate from 11% to 9%. However, the CMA has been concerned with some statements regarding the incorporation of professionals. In response to the federal government's statement, the CMA has received a significant volume of correspondence from its membership; unprecedented in our almost 150 year history. Presented within this brief are the results of a survey undertaken by the CMA to explore physician incorporation. The survey was distributed to a sample of 25,000 physicians on Dec. 21, 2015 and closed on Jan. 8, 2016 with a response rate of 9%. Among the key findings of the CMA's survey on incorporation was that more than 8 out of 10 respondents indicated that they were incorporated and reported an average of 2 full-time employees in their professional corporation, including themselves. When part-time employees where included, this increased to an average of 3 employees. Survey respondents confirmed that physician gross (pre-tax) salary is not representative of net salary; where overhead expenses were reported to be 29%, on average, of gross (pre-tax) professional income. Of note, there have been several studies at the provincial level that specifically researched overhead expenses; these studies found average overage expenses to exceed 40% of gross salary. The results of the CMA's survey confirms that the CCPC framework provides a critical tax equity measure that recognizes the unique challenges they face as small business owners and critical to the operation of the practice model, particularly supporting community-based care. In some cases, the practice model is only economical within this framework. An important fact is that unlike other small business owners, physicians cannot pass on any increases in compliance or operating costs to patients, given the design of Canada's public health care system. When asked to consider the likelihood of various actions they may take should the federal government alter the CCPC framework, a large majority (75%) of the respondents indicated that they would be very or somewhat likely to take one or more of these actions: * more than half (54%) of practicing physicians said that they would be very or somewhat likely to reduce the number of hours worked; * 42% would be very or somewhat likely to reduce office staff; and, * about one quarter indicated that they would be very or somewhat likely to pursue other measures such as closing their practice and retiring (24%) or relocating their practice to another provincial/territorial jurisdiction (26%) or to the U.S. or another country (22%). This brief also highlights the policy imperative for extending incorporation to medical professionals. As captured in Ontario's 2000 budget document, it is "to level the playing field with other self-employed individuals who can choose whether to operate their businesses through a corporation".1 Finally, the CMA's core recommendation to the federal government is to maintain tax equity for medical professionals by affirming its commitment to the existing framework governing Canadian-Controlled Private Corporations. Introduction The Canadian Medical Association (CMA) is the national voice of Canada's doctors. The CMA is the voluntary professional organization representing more than 83,000 physicians across all regions in Canada and comprising 12 provincial and territorial medical associations and more than 60 national medical organizations. The CMA's mission is helping physicians care for patients. The purpose of this brief is to provide an overview of medical practice as small businesses in Canada. As is discussed herein, a significant proportion of Canada's physicians are self-employed, small business owners, whose medical practices are incorporated as Canadian-Controlled Private Corporations (CCPCs). As such, the CMA strongly supports the federal government's commitment to reduce the small business taxation rate from 11% to 9%, as outlined in the mandate letter for the Minister of Small Business and Tourism.2 1) Most Physicians are Small Business Owners Canada's physicians are highly skilled professionals, providing an important public service and making a significant contribution to the knowledge economy. In light of the design of Canada's health care system, the vast majority of physicians are self-employed professionals operating medical practices as small business owners. More than 8 out of 10 respondents to the CMA's survey indicated that they were incorporated; 81% indicated that they were incorporated individually while 4% indicated they were incorporated in a group. Nationally, it is estimated that approximately 60% of physicians are incorporated.3 Physician-owned and run medical practices ensure that Canadians are able to access the care they need, as close to their homes as possible. In doing so, Canadian physicians are directly and indirectly responsible for hundreds of thousands of jobs across the country, and invest millions of dollars in local communities. Respondents to the CMA's survey on incorporation reported an average of 2 full-time employees in their professional corporation, including themselves. When part-time employees where included, this increased to an average of 3 employees. In operating their medical practices, Canada's physicians rent, lease or own office space and further contribute to local economies through municipal taxes on these properties. Like other self-employed small business owners, physicians typically do not have access to pensions or health benefits. In addition, as employers, physicians are responsible for the provision of payroll taxes and benefits for their employees. 2) Increased Cost-Burden for Canada's Doctors Canada's physicians face unique, additional financial and personal burdens in owning and operating medical practices in comparison with other small businesses. First, amongst Canada's small business owners4, Canada's physicians are highly skilled and trained professionals. On average, physicians enter the workforce at a later age with significant debt from education. The average age that family physicians enter practice is over 30 years and over 33 years for specialists.5 The 2013 National Physician Survey explored the issue of debt levels. It found that the proportion of medical students expecting debt of $100,000 or more doubled from 15% in 2004 to 30% in 2012.6 Further, a third of medical residents expect debt to be over $100,000 and 19% expect debt to exceed $160,000 before entering practice.7 For Canada's doctors, the high level of education-related debt and the later age they are able to initiate professional earnings represents a significant challenge for personal financial planning, notably retirement planning. Second, it is not well known that physician gross (pre-tax) salary is not representative of net salary. In addition to the expenses of running a medical practice, such as salaries and rent, physicians have a range of professional fees that are required by regulation to be submitted. According to the respondents to the CMA's survey on incorporation, these overhead expenses were reported to be 29%, on average, of gross (pre-tax) professional income. Of note, there have been several studies at the provincial level that specifically researched overhead expenses; these studies found average overage expenses to exceed 40% of gross salary.8 Finally, unlike most small business owners, as providers within a public health care systems, Canada's physicians cannot pass on any cost increases associated with operating their medical practice. The majority of physician remuneration in Canada is through "fee-for-service" systems9 whereby fees for insured physician services10 are set by the province following negotiations with the provincial medical association. Any increases in the cost of operating a medical practice, including changes in taxation, would be borne by the physician directly, as would the potential additional resource burden incurred in responding to a change to the CCPC regulatory framework. It is not surprising then that one study found that "high-income, self-employed physicians are much more sensitive to the marginal tax rate than would be suggested by previous labor-supply studies".11 The results of the CMA's survey on incorporation with respect to personal financial planning highlight the concerns associated with the unique burdens facing physicians in operating a medical practice. A strong majority (92%) of respondents rated the ability to save for retirement as very important for personal financial planning. A majority (61%) of respondents indicated the ability to pay off debt and half (50%) indicated the ability to manage practice overhead costs as very important for personal financial planning. 3) Role of Incorporation for Ensuring Tax Equity for Medical Professional As reviewed above, in light of the design of Canada's health care system, the majority of physicians are self-employed professionals and small business owners. Like other small business owners, physicians do not have access to pension and health benefits, despite investing in local communities and providing employment. Unlike other small business owners, physicians commence professional income later in life and carry high debt levels associated with education and training. In light of these significant considerations, the CCPC framework represents a measure of tax equity for Canada's physicians. In Canada, the 12 jurisdictions have extended the ability to incorporate to medical professionals. As stated in Ontario's 2000 budget document, the underlying policy purpose of extending incorporation to medical professionals is "to level the playing field with other self-employed individuals who can choose whether to operate their businesses through a corporation".12 For self-employed professionals, incorporation offers many well recognized benefits. As highlighted by most taxation guidance, the application to the small business deduction and the ability to retain income in the corporation are significant benefits of incorporation for small businesses.13 For self-employed medical professionals without access to an employer pension or benefits, the ability to retain income in the corporation contributes to retirement and pension planning capabilities. Finally, the CCPC framework allows for income splitting with family members in almost all jurisdictions. The CMA's survey on incorporation explored the benefits of the CCPC framework. The top rated benefit of incorporation was the ability for professional income to be taxed at the small business taxation rate, with 85% rating it as very important. In comparison, 60% of respondents indicated that income splitting with a family member was very important. 4) Changes to the CCPC Framework and Potential Unintended Consequences As noted above, the federal government has committed to reducing the small business taxation rate from 11% to 9%. In recognition of the significant financial pressures managed by physicians owning and operating medical practices, the CMA strongly supports this commitment. However, along with this commitment, the federal government has made concerning statements regarding professionals and the CCPC framework. While the federal government has not indicated a specific measure or timeline, the statements on their own have yielded significant uncertainty and concern. In response to the federal government's statement, the CMA has received a significant volume of correspondence from its membership; unprecedented in our almost 150 year history. The CMA cannot emphasize enough the need for caution in considering changes to the CCPC framework. The CCPC framework and the ability of incorporated physicians to maintain access to the small business rate is fundamental to the business model for these medical practices. Changes to the framework could have real and far-reaching impacts. Beyond the immediate impact to a physician, employees of a medical practice, and the region the medical practice serves, depending on the scope of changes to the CCPC framework, impacts could be at the health-sector level, particularly in terms of shifting the delivery of care away from institutionalized care toward community-based care. The physicians surveyed by the CMA were asked to consider the likelihood of various actions they may take should the federal government alter the CCPC framework. A large majority (75%) of the respondents indicated that they would be very or somewhat likely to take one or more of these actions: * more than half (54%) of practicing physicians said that they would be very or somewhat likely to reduce the number of hours worked; * 42% would be very or somewhat likely to reduce office staff; and, * about one quarter indicated that they would be very or somewhat likely to pursue other measures such as closing their practice and retiring (24%) or relocating their practice to another provincial/territorial jurisdiction (26%) or to the U.S. or another country (22%). The responses to the CMA's survey on incorporation align with the limited research available on this issue. In a study that explored the interprovincial migration of physicians confirmed that "the differences in real income have a positive and significant effect on a physician's decision to migrate from one province to another".14 Another study that explored the impacts of taxation on physicians, noted that "it has been demonstrated in the literature that physicians in higher-tax states work less on average".15 These studies emphasize the potential for unintended consequences should changes to the CCPC framework impact physician medical practice. Conclusion As outlined in this brief, the majority of Canada's doctors are self-employed, highly skilled professionals providing a critical health care contribution in communities across the country. For these physicians, the CCPC framework provides a critical tax equity measure that recognizes the unique challenges they face as small business owners. For the vast majority of incorporated physicians, the benefits of the CCPC framework are critical to the operation of the practice model, particularly supporting community-based care. In some cases, the practice model is only economical within this framework. In light of the intrinsic role of the CCPC framework to medical practice, and therefore the provision of medical care in Canada, the CMA encourages significant caution in considering any potential changes to this framework. The CMA's core recommendation to the federal government is to maintain tax equity for medical professionals by affirming its commitment to the existing framework governing Canadian-Controlled Private Corporations. References 1 Ontario Budget 2000 https://www.poltext.org/sites/poltext.org/files/discours/ON/ON_2000_B_37_01.pdf 2 Mandate Letter for the Minister of Small Business and Tourism http://www.pm.gc.ca/eng/minister-small-business-and-tourism-mandate-letter 3 CMA. 2014. Environmental Scan. 4 Industry Canada. Key Small Business Statistics 2013 https://www.ic.gc.ca/eic/site/061.nsf/eng/02814.html 5 Canadian Post M.D. Registry. 6 National Physician Survey http://nationalphysiciansurvey.ca/wp-content/uploads/2013/03/C3PR-Bulletin-StudentResidentDebt-201303-EN.pdf 7 National Physician Survey http://nationalphysiciansurvey.ca/wp-content/uploads/2013/03/C3PR-Bulletin-StudentResidentDebt-201303-EN.pdf 8 Alberta Medical Association. Setting the record straight on physician compensation. https://www.albertadoctors.org/Media%20PLs%202013/Feb1_2013_PL_Backgrounder.pdf and Ontario Medical Association. Payments to physicians and practice overhead expenses: separating facts from fiction in Ontario. https://www.oma.org/resources/documents/paymentsphysicians_pp18-19.pdf. and R.K. House & Associates Ltd. Executive Summary for the British Columbia Medical Association: 2005 Overhead Cost Study. 9 CIHI. Physicians in Canada, 2014: Summary Report. https://secure.cihi.ca/free_products/Summary-PhysiciansInCanadaReport2014_EN-web.pdf 10 Health Canada. Canada Health Act Annual Report 2014-15. http://www.hc-sc.gc.ca/hcs-sss/pubs/cha-lcs/2015-cha-lcs-ar-ra/index-eng.php 11 Mark H. Showalter and Norman K. Thurston. Taxes and labor supply of high-income physicians. Journal of Public Economics 66 (1997) 73-97. 12 Ontario Budget 2000 https://www.poltext.org/sites/poltext.org/files/discours/ON/ON_2000_B_37_01.pdf 13 Manulife. The Professional's Option - Professional Incorporation. https://repsourcepublic.manulife.com/wps/wcm/connect/02b56600433c4887b94dff319e0f5575/ins_tepg_taxtopicproopt.pdf?MOD=AJPERES&CACHEID=02b56600433c4887b94dff319e0f5575 14 Michael Benarroch and Hugh Grant. The interprovincial migration of Canadian physicians: does income matter? Applied Economics, 2004, 36, 2335-2345. 15 Norman K. Thurston and Anne M. Libby. Taxes and Physicians Use of Ancillary Health Labor. The Journal of Human Resources, XXXV 2.
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8 records – page 1 of 1.