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The Canadian Medical Association's brief to the Standing Committee on Finance concerning the 2007 budget

https://policybase.cma.ca/en/permalink/policy8566
Last Reviewed
2019-03-03
Date
2006-09-27
Topics
Health systems, system funding and performance
  1 document  
Policy Type
Parliamentary submission
Last Reviewed
2019-03-03
Date
2006-09-27
Topics
Health systems, system funding and performance
Text
Making Canadians healthy and wealthy In the face of an increasingly competitive global economy, Canada must create incentives for its citizens and businesses to invest so that greater investment will increase productivity and our standard of living. The first place to invest is in the health of the workforce. The CMA recognizes the benefits of aligning tax policy with health policy in order to create the right incentives for citizens to realize their potential. Global competitiveness is about getting Canada beyond commodities The latest Canadian economic outlook is mixed. Our economy is forecast to grow by 3 per cent in 2007 which is the fastest growing economy among the G7 countries, according to the International Monetary Fund's semi-annual World Economic Outlook. While this may seem impressive, this growth is fuelled by commodity prices. "The Canadian economy continues to perform robustly, benefiting from...the boom in global commodity prices,'' the IMF said. In fact this is one of the key concerns included in the latest outlook from TD Economics, namely that, "Weakening U.S. demand will lead to a pullback in commodity prices, including a drop in the price of oil to $50 US a barrel in 2007"1. What can the federal government do to mitigate these bumps in the global economy? Investing in "specialized factors" is the key to global competitiveness Canada's place in a competitive world cannot be sustained by commodities or what the godfather of competitive advantage theory, world-renowned Harvard Professor Michael Porter, calls "non-key" factors. Instead, Porter suggests that sustainable competitive advantage is based on "specialized factors" such as skilled labour, capital and infrastructure. These specialized factors are created, not inherited. Moreover, Porter makes the important distinction that the crafting of "social" policies must make them reinforcing to the true sources of sustainable prosperity.2 The demand for highly skilled labour forces does not fluctuate as commodity prices do. This submission follows Porter's line of thinking in suggesting that Canada should build on these specialized factors, emphasizing the health of our skilled labour force, enhancing the skills of our health care providers and making key investment in our electronic health infrastructure. Why the CMA is addressing Canada's place in competitive world The 63,000 members of the Canadian Medical Association are best known for taking care of Canadians - 32.3 million of them - individually and collectively. Through prevention, treatment and research, physicians are also vital in supporting business by ensuring that our work force is as healthy as can be. But our members are also an important economic force in their own right as they own and operate over 30,000 small businesses employing 142,000 people across the country. 3 What's more, small businesses, like the ones physicians run, invest in research and development proportionally on a far larger scale than big corporations. 4 In addition to the clinical services they provide, physicians are vitally engaged in advancing medical knowledge through teaching and research, leading to greater innovation. Health as an investment -"the greatest benefit to mankind" According to distinguished Yale economist, William Nordhaus, "The medical revolution over the last century appears to qualify, at least from an economic point of view, for Samuel Johnson's accolade as "the greatest benefit to mankind." 5 People demand and spend more money on health because it is useful. The goal of a competitive economy is to produce more wealth. The wealthier our citizens become, the more health care they demand. In other words health care is in economic terms a "superior good". Short, medium and long-run incentives for increased productivity The pursuit of productivity to ensure Canada's competitiveness in the world is not and cannot be a short-term goal. Productivity is apolitical. Setting the foundation for productivity requires dedication to long-term goals in education, physical infrastructure and health. However, there are recommendations that can create immediate incentives for citizens and businesses to kick start more productive activity sooner than later. Executive Summary The CMA's pre-budget submission presents the facts on how investments in citizens, businesses and health infrastructure make our economy more competitive. Improvements in the quality of care, and especially timely access to care, enable the Canadian labour force to increase its performance and fully reach its potential. Our submission is also sensitive to the constraints facing the federal government and so we have considered the return on investment for these recommendations. The CMA recognizes the benefits of aligning tax policy with health policy in order to create the right incentives for citizens to realize their potential. Accordingly, our proposals include tax incentives for healthy living and a recommendation to encourage savings for long-term health care. The time horizon for our 10 recommendations ranges from short-term wins such as getting Canadian doctors working in the U.S. back to Canada sooner than later to turning the tide of rising obesity in Canada. We hope that the Standing Committee on Finance considers these short-term returns on investment as well as the longer returns on investment. A Greek proverb said it best, "A society grows great when old men plant trees whose shade they know they shall never sit in". This can be a great legacy of the Committee. On behalf of the members of the Canadian Medical Association, I wish you all the best in your deliberations. Recommendations for Committee consideration Medicine for a More Competitive Canadian Economy6 -10 recommendations with investment estimates A. CITIZENS - healthy living Recommendation 1: That the government consider the use of taxes on sales of high-calorie, nutrient-poor foods as part of an overall strategy of using tax incentives and disincentives to help promote healthy eating in Canada. Recommendation 2: That the government assess the feasibility of an individual, tax-sheltered, long-term health care savings plan. B. BUSINESS - healthy workforce Recommendation 3: That the government advances the remaining $1-billion from the 2004 First Ministers Accord that was originally intended to augment the Wait Times Reduction Fund (2010-2014) to support the establishment of a Patient Wait Times Guarantee and deliver on the speech from the throne commitment. Recommendation 4: That the federal government provide the Canadian Institute for Health Information with additional funding for the purpose of enhancing its information gathering efforts for measuring, monitoring and managing waiting lists and extending the development and collection of health human resource data to additional health professions. Recommendation 5: That the government launch a direct advertising campaign in the United States to encourage expatriate Canadian physicians and other health professionals to return to practice in Canada. Investment: A one-time investment of $10-million. Recommendation 6: That the government provide a rebate to physicians for the GST/HST on costs relating to health care services provided by a medical practitioner and reimbursed by a province or provincial health plan. Investment: $52.7-million per year or 0.2 % of total $31.5- billion GST revenues. C. INFRASTRUCTURE - healthy systems Recommendation 7: That the government follow through on the recommendation by the Federal Advisor on Wait Times to provide Canada Health Infoway with an additional $2.4-billion to secure an interoperable pan-Canadian electronic medical record with a targeted investment toward physician office automation. Investment: $2.4-billion over 5 years. Recommendation 8: That the government establish a Public Health Infrastructure Renewal Fund ($350-million annually) to build partnerships between federal, provincial and municipal governments, build capacity at the local level, and advance pandemic planning. Recommendation 9: That the government recommit to the $100-million per year for immunization programs under the National Immunization Strategy. Recommendation 10: That the government Increase the base budget of the Canadian Institutes of Health Research to enhance research efforts in the area of population health and public health, as well as significantly accelerate the pace of knowledge transfer. Investment: $600-million over 3 years. Introduction It is well known that Canada's place in a competitive world cannot be sustained by commodities or what the godfather of competitive advantage theory, Michael Porter calls "non-key" factors. Instead Porter suggests that sustainable competitive advantage is based on "specialized factors" such as skilled labour, capital and infrastructure. These specialized factors are created, not inherited. Moreover, Porter makes the important distinction that the crafting of "social" policies must make them reinforcing to the true sources of sustainable prosperity.7 The demand for highly skilled labour forces does not fluctuate as commodity prices do. This submission follows that line of thinking in suggesting that Canada should build on these specialized factors, emphasizing the health of our skilled labour force, enhancing the skills of our health care providers as well as making key investment in our health infrastructure - electronic and otherwise. Outline: healthy citizens, businesses, infrastructure and affordable government The Canadian Medical Association (CMA) brief submitted to the Standing Committee on Finance will make 10 recommendations on how the federal government can make our economy more competitive by investing in three priorities: health, health care and health infrastructure. The brief will address these topics, aligning them with support for our (A) citizens, (B) businesses and (C) infrastructure. The CMA also recognizes that the federal government does not have unlimited resources and suggests actions to be taken in order to ensure that these recommendations are both affordable and sustainable. Accordingly, we will also provide a "balance sheet" of investments, return on investments, as well as revenue raising possibilities that could help create incentives for healthy living and, in turn, a more competitive economy. A. Citizens - healthy living Canadians must become fitter and healthier. Almost 60% of all Canadian adults and 26% of our children and adolescents are overweight or obese. 8 Dr. Ruth Collins-Nakai, the immediate past-president of the CMA and a cardiac-care specialist, recently said ""I have a very real fear we are killing our children with kindness by setting them up for a lifetime of inactivity and poor health,". Canada should follow the lead of European countries, which have recently recommended a minimum of 90 minutes a day of moderate activity for children. Kicking a soccer ball or riding a skateboard for 15 to 30 minutes two or three times a week is not good enough, she said. Obesity costs Canada $9.6 billion per year. 9 These costs continue to climb. The federal government must use every policy lever possible at its disposal in order to empower Canadians to make healthy choices, help to reduce the incidence of obesity and encourage exercise as well as a proper diet. Obesity and absenteeism affect the bottom line Obesity not only hurts our citizens it is also a drag on Canadian competitiveness. There is a direct correlation between increasing weights and increasing absenteeism. The costs associated with employee absenteeism are staggering. Employee illness and disability cost employers over $16-billion each year.10 For instance, the average rate of absence due to illness or disability for full-time Canadian workers was 9.2 days in 2004, a 26% increase over the last 8 years, according to Statistics Canada's latest labour force survey. While there is a growing awareness of the costs due to obesity are well known. The programs and incentives in place now are clearly not working as the incidence of obesity continues to grow. The benefits of turning the tide of obesity are also clear. In his remarks to the CMA in August 2006, Minister Tony Clement made the following statement: "And you know and I know that health promotion, disease and injury prevention not only contribute to better health outcomes, they help reduce wait times as well." The experts agree, "The economic drive towards eating more and exercising less represents a failure of the free market that governments must act to reverse it."11 Recommendation 1: That the government consider the use of taxes on sales of high-calorie, nutrient-poor foods as part of an overall strategy of using tax incentives and disincentives to help promote healthy eating in Canada. Tax-sheltered savings for long-term care - aligning tax policy and health policy Canada is entering an unprecedented period of accelerated population aging that will see the share of seniors aged 65 and over increase from 13% in 2005 to 23% in 2031. At the same time, the cost of privately funded health services such as drugs and long-term care are projected to increase at double-digit rates as new technologies are developed and as governments continue to reduce coverage for non-Medicare services in order to curb fiscal pressures12. Since seniors tend to use the health system more intensively than non-seniors, the rising cost of privately funded health services will have a disproportionately high impact on seniors. Canadians are not well equipped to deal with this new reality. Private long-term care insurance exists in Canada, but is relatively on the Canadian scene and has not achieved a high degree of market penetration. New savings vehicles may be needed to help seniors offset the growing costs of privately funded health services. One approach would be extend the very successful model of RRSPs to enable individuals save for their long-term care needs via a tax-sheltered savings plan. Recommendation 2: That the government assess the feasibility of an individual tax-sheltered long-term health care savings plan. B. Business - healthy workforce In spite of the fact that health as an economic investment has proven returns, governments have been letting up in their support of their citizens' health. The impact is felt not only in terms of poorer health but it also affects businesses through increased absenteeism, as well as governments through lower tax revenues. According to the Center for Spatial Economics, "...the cumulative economic cost of waiting for treatment across Ontario, Saskatchewan, Alberta and BC in 2006 is estimated to be just over $1.8-billion. This reduction in economic activity lowers federal government revenues by $300-million." 13 The total costs to the federal government are even higher if all 10 provinces were included. The estimate is based on four of the five priority areas identified in the 2004 First Ministers Health Accord: total joint replacement surgery, cataract surgery, coronary artery bypass graft, and MRI scans. If you wonder what all this has to do with Canadian business, ask yourself how many person/hours employers lose due to illness? How much productive time is lost due to the stress of an employee forced to help an elderly parent who cannot find a doctor? This challenging situation is going to get worse, as the population ages, and as our health professionals age and retire. Supporting the Patient Wait Time Guarantee The establishment of pan-Canadian wait time benchmarks and a Patient Wait Times Guarantee are key to reducing wait times and improving access to health services. The 2004 First Ministers' health care agreement set aside $5.5-billion for the Wait Time Reduction Fund, of which $1-billion is scheduled to flow to provinces between 2010 and 2014. To assist provinces with the implementation of the wait time guarantee while remaining within the financial parameters of the health care agreement, the federal government could advance the remaining $1-billion and flow these funds to provinces immediately. Recommendation 3: That the government advances the remaining $1-billion from the 2004 First Ministers Accord that was originally intended to augment the Wait Times Reduction Fund (2010-2014) to support the establishment of a Patient Wait Times Guarantee and deliver on the speech from the throne commitment. Making investments count and counting our investments It would be irresponsible for government to make investments if the results were not being measured. As management guru Tom Peters suggests, "What you do not measure, you cannot control." And, "What gets measured gets done." As billion dollar federal funding of health care reaches new heights, the value of measuring these investment increases. That is where the Canadian Institute for Health Information (CIHI) comes in. CIHI has been involved in developing wait time indicators and tracking Canada's progress on wait times. It is essential that we have an arm's length body responsible for collecting data on wait times as part of Canada's effort to improve timely access to care for Canadians. CIHI has also played an active role in health human resource data collection and research. Their financial support for the 2004 National Physician Survey resulted in a one-of-a-kind research file with input from over 20,000 Canadian physicians. Recommendation 4: That the federal government provide the Canadian Institute for Health Information with additional funding for the purpose of enhancing its information gathering efforts for measuring, monitoring and managing waiting lists and extending the development and collection of health human resource data to additional health professions. Direct advertising in the U.S. to bolster health human resources deficit The primary barrier affecting timely access to quality health care is the shortage of health care professionals. Canada currently ranks 26th in the OECD in terms of physicians per capita, at 2.1 MDs per 1,000 people. More than three million Canadians do not have a family physician. This situation will get worse as the population ages and as our health professionals age and retire. Fortunately, another short-term source of health professionals exists that Canada should pursue. Thousands of health care professionals are currently working in the United States including approximately 9,000 Canadian trained physicians. We know that many of the physicians who do come back to Canada are of relatively young age meaning that they have significant practice life left. While a minority of these physicians do come back on their own, many more can be repatriated in the short-term through a relatively small but focussed effort by the federal government led by a secretariat within Health Canada. Recommendation 5: That the government launch a direct advertising campaign in the United States to encourage expatriate Canadian physicians and other health professionals to return to practice in Canada. Investment: A one-time investment of $10-million. Re-investing the GST for 30,000 small businesses The continued application of the GST on physician practices is an unfair tax on health. Because physicians cannot recapture the GST paid on goods and services for their practices in the same way most other businesses can, the GST distorts resource allocation for the provision of medical care. As a result, physicians end up investing less than they otherwise could on goods and services that could improve patient care and enhance health care productivity such as information management and information technology systems. The introduction of the GST was never intended to fall onto the human and physical capital used to produce goods and services. The GST is a value-added tax on consumption that was put into place to remove the distorting impact that the federal manufacturers sales tax was having on business decisions. However, the GST was applied to physician practices in a way that does exactly the opposite. The federal government must rectify the situation once and for all. Based on estimates by KPMG, physicians have paid $1.1-billion in GST related to their medical practice since 1991. This is $1.1-billion that could have been invested in better technology to increase care and productivity. Recommendation 6: That the government provide a rebate to physicians for the GST/HST on costs relating to health care services provided by a medical practitioner and reimbursed by a province or provincial health plan. Investment: $52.7-million per year or 0.2 % of total $31.5-billion GST revenues. C. Infrastructure -healthy system Recovery of health information technology investments is almost immediate A Booz, Allen, Hamilton study on the Canadian health care system estimates that the benefits of an EHR could provide annual system-wide savings of $6.1 billion, due to a reduction in duplicate testing, transcription savings, fewer chart pulls and filing time, reduction in office supplies and reduced expenditures due to fewer adverse drug reactions. The study went on to state that the benefits to health care outcomes would equal or surpass these annual savings. Evidence shows that the sooner we have a pan-Canadian EHR in place, the sooner the quality of, and access to health care will improve.14 Mobilizing physicians to operationalize a pan-Canadian Electronic Health Record The physician community can play a pivotal role in helping the federal governments make a connected health care system a realizable goal in the years to come. Through a multi-stakeholder process encompassing the entire health care team, the CMA will work toward achieving cooperation and buy-in. This will require a true partnership between provincial medical associations, provincial and territorial governments and Canada Health Infoway (CHI). The CMA is urging the federal government to allocate an additional investment of $2.4-billion to Canada Health Infoway over the next five years15 to build the necessary information technology infostructure to address wait times16 as well as support improved care delivery. Both the Federal Wait Times Report and Booz Allen Study concur that this requires automating all community points of care - i.e., getting individual physician offices equipped with electronic medical records (EMRs). This is a necessary, key element to the success of the EHR agenda in Canada and recent assessments place the investment required at $1.9-billion of the $ 2.4-billion. CHI has proven to be an effective vehicle for IT investment in Canadian health care. For example, as a result of CHI initiatives, unit costs for Digital Imaging have been reduced significantly and are already saving the health care system up to 60-million dollars. In fact as a result of joint procurements and negotiated preferred pricing arrangements through existing procurement efforts with jurisdictional partners the estimated current cost avoidance is between $135-million to $145-million. Moreover, in the area of a Public Health Surveillance IT solution, a pan Canadian approach to CHI investments with jurisdictional partners has lead to benefits for users, the vendor and Canadians. The negotiation of a pan-Canadian licence enables any jurisdiction to execute a specific licence agreement with the vendor and spawn as many copies as they need to meet their requirements. The vendor still owns the IP and is free to market the solution internationally - clearly a win/win for both industry and the jurisdictions. Recommendation 7: That the government follow through on the recommendation by the Federal Advisor on Wait Times to provide Canada Health Infoway with an additional $2.4-billion to secure an interoperable pan-Canadian electronic medical record with a targeted investment toward physician office automation. Investment: $2.4-billion over 5 years. Establishing a Public Health Infrastructure Renewal Fund The CMA remains concerned about the state of Canada's public health system. Public health, including the professionals providing public health services, constitutes our front line against a wide range of threats to the health of Canadians. While there is much talk about the arrival of possible pandemics, Canada's public health system must be ready to take on a broad range of public health issues. The CMA has been supportive of the Naylor report which provides a blue print for action and reinvestment in the public health system for the 21st century. While this will take several years to achieve, there are some immediate steps that can be taken which will lessen the burden of disease on Canadians and our health care system. These steps include establishing a Public Health Partnership Program with provincial and territorial governments to build capacity at the local level and to advance pandemic planning. In addition, we call on the government to continue its funding of immunization programs under its National Immunization Strategy. Public health must be funded consistently in order to reap the full benefit of the initial investment. Investments in public health will produce healthier Canadians and a more productivity workforce for the Canadian economy. But this takes time. By the same token, neglect of the public health system will cost lives and hit the Canadian economy hard. Recommendation 8: That the government establish a Public Health Infrastructure Renewal Fund ($350-million annually) to build partnerships between federal, provincial and municipal governments, build capacity at the local level, and advance pandemic planning. Supporting the National Immunization Strategy Dr. Ian Gemmell, Co-Chair of the Canadian Coalition for Immunization Awareness and Promotion, has said, "Vaccines provide the most effective, longest-lasting method of preventing infectious diseases in all ages." strongly urge that immunization programs be supported. Healthy citizens are productive citizens and strong immunization programs across the country pay for themselves over time. Recommendation 9: That the Federal Government recommit to the $100-million per year for immunization programs under the National Immunization Strategy. Making medical research investments count - supporting knowledge transfer The Canada Institutes of Health Research (CIHR) was created to be Canada's premier health research funding agency. One of the most successful aspects of the CIHR is its promotion of inter-disciplinary research across the four pillars of biomedical, clinical, health systems and services as well as population health. This has made Canada a world leader in new ways of conducting health research. However, with its current level of funding, Canada is significantly lagging other industrialized countries in its commitment to health research. Knowledge transfer is one of the areas where additional resources would be most usefully invested. Knowledge Translation (KT) is a prominent and innovative feature of the CIHR mandate. Successful knowledge translation significantly increases and accelerates the benefits flowing to Canadians from their investments in health research. Through the CIHR, Canada has the opportunity to establish itself as an innovative and authoritative contributor to health-related knowledge translation. Population and public health research is another area where increased funding commitments would yield long-term dividends. Recommendation 10: That the government Increase the base budget of the Canadian Institutes of Health Research to enhance research efforts in the area of population health and public health, as well as significantly accelerate the pace of knowledge transfer. Investment: $600-million over 3 years. Conclusion The CMA recognizes the benefits of aligning tax policy with health policy in order to create the right incentives for citizens to realize their potential. Accordingly our proposals include tax incentives for healthy living as well as a recommendation to encourage savings for long-term health care. The time horizon for our 10 recommendations ranges from short-term wins such as getting Canadian doctors working in the U.S. back to Canada sooner than later to turning the tide of rising obesity in Canada. We hope that the Standing Committee on Finance considers these short-term returns on investment as well as the longer returns on investment. A Greek proverb said it best, "A society grows great when old men plant trees whose shade they know they shall never sit in". This can be a great legacy of the Committee. On behalf of the members of the Canadian Medical Association, I wish you all the best in your deliberations. Appendix 1 - Recommendations for Committee consideration 10 point plan with estimated investments and revenues Appendix 2 - The Information Technology Agenda in the Canadian Health Care Sector * The Health Council of Canada, the Presidents and CEOs from the Academic Healthcare Organizations and the federal advisor on wait times all agree on the need to accelerate the building out of the information technology infostructure for the healthcare sector * All these groups amongst others argue that there are large gains to be made on improving healthcare delivery and achieving efficiencies in operating the health care system * Automating health care delivery in Canada will lead to a more efficient healthcare system and will build industry capacity to compete in the international market place * A $10-billion investment is estimated to result in a return on investment (ROI) exceeding investment dollars by an 8:1 margin, and a net savings of $39.8-billion over a 20-year period. It is estimated that a net positive cash flow would occur in Year Seven of implementation, and an investment breakeven by Year 11, resulting in an annual net benefit of $6.1-billion.17 * Part of this investment is to automate the over 35,000 physicians who have a clinic in a community setting * It is estimated that $1.9-billion is needed to accomplish this task which when complete will facilitate better management of wait times, improved patient safety, helping to address in part the human resource shortage for providers as well as make a contribution to improved First Nation health. * Our recommendation is that the Federal government provide a further direct investment of $1-billion into Canada Health Infoway (CHI) that is targeted to the automation of physician offices. This funding would pay for 50% of the costs to automate a physician's clinic. * The funds would be allocated to provinces and medical associations through CHI once an agreement has been developed. A jointly developed program would ensure complementarity with a provincial health IT strategy and a program that has been designed by physicians such that it does the most to improve health care delivery * Physicians would be asked to pay the other 50% and through tax policy they would be able to claim a deduction for capital information technology acquisitions * This arrangement mirrors current programs funded by CHI on a 75%-25% cost sharing model with provinces but with physicians picking up approximately 25% of the costs Appendix 3 Can taxation curb obesity? A recent article in the New Scientiest.com1 asks, Can taxation curb obesity? "The economic drive towards eating more and exercising less represents a failure of the free market that governments must act to reverse."18 "We have market failure in obesity, because we have social costs greater than the private costs," according to Lynee Pezullo director of the economic advisory group Access Economics. "The government also bears the health costs, and people don't take into account costs they bear themselves. If people had to pay for their own dialysis they might bear these things in mind a bit more." When two-thirds of the population of countries like Australia or the US are obese or overweight, you can't handle the problem with simple solutions like education," Barry Popkin of the University of North Carolina, Chapel Hill. A Yale University professor is generating support for a "twinkie tax"1 on high-calorie foods like french fries. This tax works In California in 1988, Proposition 99 increased the state tax by 25 cents per cigarette pack and allocated a minimum of 20% of revenue to fund anti-tobacco education. From 1988 to 1993, the state saw tobacco use decline by 27%, three times better than the U.S. average.1 CMA is not alone in supporting a junk food tax In December, 2003, the World Health Organization proposed that nations consider taxing junk foods to encourage people to make healthier food choices. According to the WHO report, "Several countries use fiscal measures to promote availability of and access to certain foods; others use taxes to increase or decrease consumption of food; and some use public funds and subsidies to promote access among poor communities to recreational and sporting facilities." The American Medical Association is planning to demand the government to levy heavy tax on the America's soft drinks industry. Currently, 18 U.S. states have some form of "snack" food tax in place and five states have proposed policy and legislative recommendations. The economic costs of obesity are estimated at $238-billion annually, and rising. Along the same lines, the former Surgeon General, C. Everett Koop, believes that after smoking, "obesity is now the number one cause of death in [the U.S.]...we're not doing the same kind of things with obesity that we have done with smoking and alcohol as far as government programs are concerned ... It's got to be like smoking, a constant drum beat." 1 "U.S. Slowdown Underway Canada in for a Bumpy Ride" See www. td.com/economics/ (accessed Sept. 19, 2006) 2www.worldbank.org/mdf/mdf1/advantge.htm (accessed Sept. 19, 2006) 3 Source: Statistics Canada, Business Register 2005. 4 Source: Statistics Canada, Industrial Research and Development -2004 intentions, No. 88-202-XIB, January 2005. 5 Nordhaus notes that over the 1990-1995 period the value of improved health or health income grew at between 2.2 and 3.0 per cent per year in the United States, compared to only 2.1 per cent for consumption. See The Health of Nations: The Contribution of Improved Health to Living Standards William D. Nordhaus, Yale University www.laskerfoundation.org/reports/pdf/economic.pdf (accessed Sept. 18, 2006) 6 See Appendix 1 for 3-year investment details as well as short, medium and long-term returns on investment 7 www.worldbank.org/mdf/mdf1/advantge.htm Accessed September 20, 2006. 8 Source: ww2.heartandstroke.ca/Page.asp?PageID=1366&ArticleID=4321&Src=blank&From=SubCategory Accessed August 14, 2006. 9 P.Katzmarzyk, I. Janssen "The Economic costs associated with physical inactivity and obesity in Canada: An Update" Can J Applied Physiology 2004 Apr; 29(2):90-115. www.phe.queensu.ca/epi/ABSTRACTS/abst81.htm Accessed August 14, 2006. 10 Staying@Work 2002/2003 Building on Disability Management, Watson Wyatt Worldwide www.watsonwyatt.com/canada-english/pubs/stayingatwork/ Accessed July 31, 2006. 11 Swinburn, et al. International Journal of Pediatric Obesity (vol 1, p 133) (accessed Sept. 19, 2006) 12 Canada's Public Health Care System Through to 2020, the Conference Board of Canada, November 2003. 13 The Economic Cost of Wait Times in Canada, by the Center for Spatial Economics, June 2006. www.cma.ca/multimedia/CMA/Content_Images/Inside_cma/CMA_This_Week/BCMA-CMA-waittimes.pdf 14 Booz, Allan, Hamilton Study, Pan-Canadian Electronic Health Record, Canada's Health Infoway's 10-Year Investment Strategy, March 2005-09-06 15 See Appendix 1 and Appendix 2 for more investment details and background. 16 Final Report of the Federal Advisor on Wait Times, June 2006, Dr. Brian Postl 17 Booz Allen Hamilton Study, Pan-Canadian Electronic Health Record, Canada Health Infoway's 10-Year Investment Strategy, March 2005 18 Can taxation curb obesity? See www.newscientist.com/article/dn9787-can-taxation-curb-obesity.html (accessed September 20, 2006.) Medicine for a more competitive Canadian economy
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CMA Submission: The need for health infrastructure in Canada

https://policybase.cma.ca/en/permalink/policy10705
Date
2013-03-18
Topics
Health systems, system funding and performance
  2 documents  
Policy Type
Parliamentary submission
Date
2013-03-18
Topics
Health systems, system funding and performance
Text
In its Economic Action Plan 2011(Budget 2011), the Government of Canada committed to consult stakeholders on the next long-term plan for public infrastructure which would extend beyond the expiry of the current framework, the Building Canada Plan, on March 31, 2014. The CMA’s 2012-13 pre-budget brief recommends that the federal government ensure health infrastructure is eligible for funding as part of the next long-term plan for public infrastructure. The purpose of which is to address a particular health infrastructure deficit that is preventing the optimization of health care resources and exacerbating wait times and ensure that Canadian communities are able to meet the current and emerging care needs of their older seniors. The CMA has prepared this brief to provide further details on the scope of the proposed infrastructure funding for the health sector, its rationale and economic benefit, and how it could be applied. 2. Overview of proposal The CMA recommends that the federal government ensure health sector infrastructure for long-term care facilities is eligible for funding under the next long-term infrastructure program. This funding should be applicable both for new capital projects and for renovating/retrofitting existing facilities. This recommendation, and the recognition of the need for additional capacity in the long-term care sector, is part of a pan-Canadian approach to redirect alternate level of care patients from hospitals to homes, communities and long-term care facilities, where they can receive more appropriate care at a lower cost. It costs $842 per day for a hospital bed versus $126 per day for a long-term care bed. If ALC patients were moved to more appropriate care settings, in this case, from hospital to long-term care, this would save the health care system about $1.4 billion a year. For the purposes of this recommendation, long-term care facilities include long-term care residential homes, assisted living units and other types of innovative residential models that ensure residents are in the setting most appropriate to their needs. The long-term care sector is facing significant change due to increasing numbers of older seniors and their increasingly complex care needs. These pressures not only relate to the construction of new facilities but apply to the need to maintain existing facilities, including retrofitting to meet higher regulatory requirements, as well as struggling to meet higher care needs of their increasingly elderly population. The CMA’s recommendation to ensure that long-term care infrastructure qualify under the next long-term infrastructure plan is one component of the association’s Health Care Transformation initiative and would support a pan-Canadian approach for continuing care, which would integrate home care and facility-based long-term, respite and palliative care services fully within the health care system. 3. Rationale The rationale behind the recommendation for health infrastructure to qualify for the next long-term infrastructure plan is based primarily on the care needs of Canada’s growing seniors’ population and its impact on Canada’s health care system. Communities across Canada face a common problem of a lack of resources to properly meet the housing and care needs of their seniors population. Demographic trends indicate this problem will only intensify. However, as demonstrated below, investing in seniors can generate substantial direct and indirect economic benefits. Meeting the needs of Canada’s growing seniors population and their changing care needs While all advanced countries are expected to age over the coming decades, the Canadian population is projected to age more rapidly than that of most other OECD countries, according to a recent report from Finance Canada. Statistics Canada reports the number of seniors (65+) in Canada is projected to increase from 4.2 million in 2005 to 9.8 million in 2036, with their share of the total population increasing from 13.2 per cent to 24.5 per cent. The number and proportion of older seniors – those 75 and older – are expected to increase significantly as well. Ontario’s population of people aged 75 and up is expected to grow by almost 30 per cent between 2012 and 2021. According to Statistics Canada’s medium-growth population projection scenario, the population aged 80 years or over will increase 2.6 times by 2036 – to 3.3 million persons. While the rate of residency in long-term care facilities among seniors has been declining, as the aging of Canada’s population accelerates, the demand for residential care will nonetheless increase significantly over the near term due to higher numbers of elderly seniors. Not only is the size of the elderly population increasing, but their health needs are changing too, particularly among those requiring residential care. Long-term care residents are older today than in previous years and have more complex health needs than ever before. A Canadian Institute for Health Information (CIHI) comparison of home care clients and seniors who are living in residential care found that “seniors in residential care were more likely to require extensive assistance with activities of daily living (ADLs), such as bathing and toileting (74 per cent versus 18 per cent). They were also more likely to have moderate to severe cognitive impairment (60 per cent versus 14 per cent). The number of residents with dementia is expected to increase. In 2011, 747,000 Canadians were living with cognitive impairment, including dementia – that’s 14.9 per cent of Canadians 65 and older. By 2031, this figure will increase to 1.4 million. At the request of the House of Commons Finance Committee, the CMA submitted a national dementia strategy. This proposal to fund long-term care facilities supports such a strategy. Many existing residential facilities are poorly equipped to meet the care needs of their residents, which are more complex now than when these facilities were originally built. For example, many facilities do not meet current building safety standards and the limited provincial and municipal funding available is usually insufficient to bring them up to code. Also, there is a lack of units with shared space to better support residents with dementia, as well as a shortage of appropriate units to care for residents who are disabled or obese. Renovations are also required to make better use of long-term care beds for other purposes such as providing short-stay respite care or transitional care. According to the Ontario Association of Community Care Access Centres, the lack of physical facilities necessary for care was the reason most often given by homes for declining to admit a long-term care wait-list client. Opportunity to improve health care efficiency and reallocate existing program spending We recognize that addressing the current gap in long-term care residency options is only one strategy to improve the effectiveness of Canada’s health care system. However, we believe it is a critical component of an integrated continuum of care strategy that provides for increased home and community supports. Improving options for seniors will have a positive cascading effect on many other elements of the system. Not only will seniors reside in more appropriate and safer settings but acute care resources will be better used. Consider that about 45 per cent of provincial and territorial governments’ health care spending in 2009 went toward those 65 years and older, while this group constituted only 14 per cent of the population. A major issue facing Canada’s health care system is the high number of alternate level of care patients (ALC) who occupy acute care beds. ALC patients are those who have completed the acute care phase of their treatment but remain in an acute care bed or who are admitted into a hospital bed due to the lack of a more appropriate care setting. In most cases, these people would be better served living in their own home with the appropriate level of supports or in a long-term care residence. The high number of ALC patients in hospitals is a problem experienced across the country. The total number of hospital bed days for ALC patients in 2007-2008 (latest figures) was 1.7 million. Furthermore, the lack of options for ALC patients also contributes to a high percentage of these patients being readmitted to hospital within 30 days of discharge (see Appendix A). According to CIHI figures, 85 per cent of ALC patients were older than age 65, with almost half waiting for placement in long-term care. A high percentage of ALC patients suffer from dementia. It costs $842 per day for a hospital bed versus $126 per day for a long-term care bed. If ALC patients were moved to more appropriate care settings, in this case, from hospital to long-term care, this would save the health care system about $1.4 billion a year. The presence of ALC patients in hospitals also lead to longer surgical wait times and longer delays in the emergency department as acute care beds remain unavailable. In fact, the Wait Time Alliance – an alliance of 14 national medical organizations and specialties – has said “the most important action to improve timely access to specialty care for Canadians is by addressing the ALC issue.” Available wait-time data (See Appendix B) for long-term care show that wait times to access a long-term care bed can often be measured in, not months or days, but years. Data from Ontario for 2004 to 2008 found that less than 50 per cent of seniors with high or very high needs were placed in a long-term care facility within a year of being put on a wait list. The average wait time for placement in Quebec is 13 months (ranging between five months and four years). The most recent report by Ontario’s Auditor General found that 15 per cent of patients on the provincial wait list for long-term care passed away while waiting for placement. The wait to access residential care can vary immensely depending on where one resides. Often the wait is longer for residents in small, rural and northern communities. Sometimes the only route to securing a placement is for the resident to move to a facility in another community. Investment required According to Statistics Canada, there are 261,945 long-term care beds in operation in Canada (latest figures, 2009/10.) How many residential beds will be required in the future to meet the growing number of elderly seniors? The Conference Board of Canada has produced a bed forecast tied to the growth of the population aged 75 and over and based on a decreased bed ratio demand of 0.59 per cent per year to reflect the greater shift to community-based services and supportive housing options being advanced at the provincial level. This bed ratio demand is described by the Canadian Healthcare Association as representing a modest shift from the current reliance on long-term care to community services. Based on these assumptions, it has been estimated that Canada will require an average of 10,535 new beds per year over the next 35 years, for a total of 637,721 beds by 2047. Demand would vary over the 35-year period, peaking between 2022 and 2040 (See Appendix C). The five-year projection for beds is as follows: Table 1: Projected shortage in long-term care beds, 2014 to 2019 [SEE PDF FOR CORRECT DISPLAY OF TABLE] Year Number of additional beds required 2014 4,331 2015 4,715 2016 6,028 2017 6,604 2018 8,015 Projected 5-year shortage 29,693 As shown, there is a projected shortage of 29,693 beds over the next five years. For the purposes of longer-term planning, the gap in beds required for the following five-year period (2019-2023) is as follows: Table 2: Projected shortage in long-term care beds, 2019 to 2023 [SEE PDF FOR CORRECT DISPLAY OF TABLE] Year Number of additional beds required 2019 8,656 2020 8,910 2021 10,316 2022 14,888 2023 14,151 As previously outlined, the rising gap in bed numbers is affected by the increased numbers in people aged 75 and older anticipated over the next 35 years. The estimated cost to construct 10,535 beds (the average number of beds required to be built per year from 2013 to 2047) is $2.8 billion, based on a cost estimate of $269,000 per bed. This figure could include both public and private spending. The purpose of this bed projection is to provide a sense of the immense challenge Canada faces in addressing the needs of a vulnerable segment of its older seniors population. It is important to note that this forecast does not include the significant investments required to renovate and retrofit the existing stock of residential facilities, not only to meet the current standards but to effectively respond to the complex care needs of residents requiring long-term care today and in the future. Similarly, the potential facility capacity expansions through retrofit or renovation are not included. Moreover, innovative capital investment in residential facilities can provide opportunities for their greater use by other members of the community. They can, for example, provide short-stay respite to support families and convalescent care programs such as those found in the United Kingdom. We also recognize that supportive housing and healthy aging programming are important components of an integrated solution to the ALC issue and to ensuring seniors reside in the most appropriate place. 4. How the funding would work Health infrastructure could qualify under a communities component of the next long-term infrastructure plan where this federal funding can be leveraged with provincial and and / or municipal investment (e.g. 1/3 federal component matched by + 2/3 provincial and / or municipal). This funding allocation could also include the use of public-private partnership models. Investing in Canada’s Continuing Care Sector Provides a Wide Range of Economic Benefits Construction of new residential care models and renovating/retrofitting existing facilities will provide significant economic opportunities for many communities across Canada (See Appendix E for detailed figures). Based on Conference Board of Canada estimates, the construction and maintenance of 10,535 long-term care beds (the average number of new beds needed per year from 2013 to 2047) will yield direct economic benefits on an annual basis that include $1.23 billion contribution to GDP and 14,141 high value jobs during the capital investment phase and $637 million contribution to GDP and 11,604 high value jobs during the facility operation phase (based on an average annual capital investment); and close the significant gap between the projected long-term care bed shortages and current planned investment. When indirect economic contributions are included, the total estimated annual contribution to Canada’s GDP reaches almost $3 billion, yielding 37,528 new jobs (construction, care providers and other sectors). Details on these economic benefits are provided in Appendix F, but a summary is presented below: Table 3: Average annual total economic contribution of new residential care facilities [SEE PDF FOR CORRECT DISPLAY OF TABLE] (10, 535 new beds per year at market prices) GDP (in 2013 $millions) Number of jobs created Average direct contribution to GDP of investing in new facilities (construction) $1,225.4 14,141 Average direct contribution to GDP of operating the new facilities $637.0 11,604 Average indirect contribution to GDP of investing in new facilities (construction) $969.9 10,115 Average indirect contribution to GDP of operating the new facilities $135.4 1,667 TOTAL (both direct and indirect) $2,968 37,528 For every 100 jobs created in the construction of long-term care facilities, an additional 72 jobs would be created in other sectors, while for every 100 jobs created in the long-term care sector, 14 jobs would be created in other sectors. The numbers provided above reflect the annual average contribution. On a time specific level, covering the five-year period between 2014 and 2018, an estimated 167,840 jobs would be created, based on the construction of 29,693 new beds. Another important economic benefit is the return in government revenues. The increase in construction and operating spending per average year will provide over $425 million in federal government revenues and over $370 million in provincial revenues (See Appendix G). As previously identified, an improved stock of long-term care beds will provide many other economic spinoffs, including savings in health care costs that can be reallocated to better meet Canadians’ health care needs and to provide greater support for families in their role as caregivers. Without adequate provision of long-term care resources, Canada’s labour force may experience a productivity drag through increased leaves and absenteeism to care for elderly relatives. 5. Conclusion The aging of our population touches all Canadians – from seniors who need the services to families who serve as caregivers and/or contribute financially to the care of aging relatives. Recent data show that 32 per cent of caregivers who provide more than 21 hours of care per week report distress in their role – four times the proportion of distressed caregivers who provide less than 10 hours of informal care per week. The federal government has a long history of allocating capital investment in the health sector. Previous examples include the Hospitals and Construction Grants Program in 1948, the Health Resources Fund established in 1966 and, more recently, the funding of capital projects at research hospitals under the Canada Foundation for Innovation Leading Edge and New Initiatives Funds in 2012. All communities across Canada are strongly affected by the social and health care needs of their growing senior and long-term care populations (see Appendix H for a sample of recent news stories.) Federal capital investment will help narrow the significant gap between the projected long-term care bed shortages and current planned investment in the area of residential care facilities. Further, it would have a cascading effect leading to a more effective and efficient Canadian health care system. Recommendation The Canadian Medical Association recommends that the federal government allocate $2.3 billion over a five-year period in the next long-term infrastructure plan for the construction, renovation and retrofitting of long-term care facilities. Long-term care facilities include long-term care residential homes, assisted living units and other types of innovative residential models that ensure residents are in the most care setting most appropriate to their needs. This funding could be delivered as part of the communities component of the next long-term infrastructure plan. 1 Department of Finance Canada. Economic and fiscal implications of Canada's aging population. Ottawa, 2012. 2 Office of the Auditor General of Ontario. 2012 annual report. 2012. http://www.auditor.on.ca/en/reports_en/en12/2012ar_en.pdf. Accessed 01/30/13. 3 Statistics Canada. Population projections for Canada, provinces and territories 2009 to 2036. June 2010. 91-520-X 4 Alzheimer's Society Ontario. Facts about dementia. http://www.alzheimer.ca/en/on/About-dementia/Dementias/What-is-dementia/Facts-about-dementia. Accessed 01/30/13. 5 Canadian Medical Association. Toward a Dementia Strategy for Canada. Ottawa, 2013. http://www.cma.ca/submissions-to-government Accessed 01/30/13. 6 Ontario Association of Non-Profit Homes and Services for Seniors. Proposals for the Ontario Budget. Fiscal Year 2012-13. March 2012. 7 David Walker. Caring for our aging population and addressing alternate level of care. Report Submitted to the Minister of Health and Long-Term Care. June 30, 2011. Toronto. 8 Long Term Care Innovation Expert Panel. Why not now? A bold, five-year strategy for innovating Ontario's system of care for older adults. March 2012. http://www.oltca.com/axiom/DailyNews/2012/June/LTCIEPFullREport_web_jun6.pdf. Accessed 01/30/13. 9 For an example of an integrated continuum of post-acute care model see CARP, One Patient: CARP's Care Continuum. http://www.carp.ca/wp-content/uploads/2013/01/One-Patient-Brief-Updated-Oct-18.pdf. Accessed 01/30/13. 10 Canadian Life and Health Insurance Association. Improving the accessibility, quality and sustainability of long-term care in Canada. CLHIA Report on Long-Term Care Policy. June 2012. 11 Wait Time Alliance. Time out! Report card on wait times in Canada. 2011. http://www.waittimealliance.ca/media/2011reportcard/WTA2011-reportcard_e.pdf. Accessed 01/30/13. 12 Correspondence with officials from Bruyère Continuing Care in Ottawa. January 2013. 13 Canadian Institute for Health Information. Health care in Canada, 2011 2011. . 14 Rapport du Vérificateur général du Québec à l'Assemblée nationale pour l'année 2012-2013. 15 Office of the Auditor General of Ontario. 2012 annual report. 2012. 16 The .59 per cent decrease in bed ratio is presented as Scenario 2 in Lazurko, M. and Hearn, B. Canadian Continuing Care Scenarios 1999-2041, KPMG Final Project Report to FPT Advisory Committee on Health Services, Ottawa. 2000. Presented in Canadian Healthcare Association, New Directions for Facility-Based Long-Term Care. 2009. http://www.cha.ca/wp-content/uploads/2012/11/CHA_LTC_9-22-09_eng.pdf. Accessed 01/30/13. 17 Canadian Institute for Health Information, Health Care in Canada, 2011.
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Healthier Generations for a Prosperous Economy: Canadian Medical Association 2013-2014 pre-budget consultation submission to the Standing Committee on Finance

https://policybase.cma.ca/en/permalink/policy11028
Date
2013-11-06
Topics
Health systems, system funding and performance
  1 document  
Policy Type
Parliamentary submission
Date
2013-11-06
Topics
Health systems, system funding and performance
Text
The Canadian Medical Association (CMA) submission to the House of Commons Standing Committee on Finance discusses the important role of the federal government in ensuring Canada's health care system is cost-effective, accountable and accessible in order to support the country's economic advantage. As in other leading industrialized countries, the federal government has an important role in the effective allocation of health-related resources and the health outcomes of Canadians. The purpose of this brief is to provide decision-makers with recommendations on areas within existing federal mandates in which the Government of Canada can contribute to advancing Health Care Transformation and improving the health of Canadians and the health care system - an issue Canadians consistently rank as their top concern. These recommendations focus on federal investment in a seniors care strategy, the social determinants of health and health sector innovation and productivity. Summary of Recommendations Recommendation # 1 The CMA recommends that the Government of Canada collaborate with provincial, territorial and municipal governments to establish and invest in a pan-Canadian strategy for seniors care. Recommendation # 2 The CMA recommends that funding for health infrastructure qualify under the next Building Canada Plan to support the construction, renovation and retrofitting of long-term care facilities. Recommendation # 3 The CMA recommends that the Government of Canada invest $25 million per year over five years toward a pan-Canadian dementia strategy. Recommendation # 4 The CMA recommends that the Government of Canada establish a Canada-wide injury prevention strategy to identify successful programs and facilitate the sharing of knowledge and resources that will enable them to be disseminated nationwide. Recommendation # 5 In support of a pan-Canadian palliative care strategy, CMA recommends that the Government of Canada undertake research to identify successful programs and facilitate the sharing of knowledge and resources so that they can be replicated nationwide. Recommendation # 6 The CMA recommends that the Government of Canada establish health as a required consideration in the Cabinet decision-making process. Recommendation # 7 The CMA recommends that the federal government, in consultation with the provincial and territorial governments, health care providers, the life and health insurance industry and the public, establish a program of comprehensive prescription drug coverage to be administered through reimbursement of provincial/territorial and private prescription drug plans to ensure that all Canadians have access to medically necessary drug therapies. Recommendation #8 The CMA recommends that the Government of Canada establish and invest in a comprehensive strategy for improving the health of aboriginal peoples that involves a partnership among governments, non-governmental organizations, and First Nations, Métis and Inuit communities. Recommendation #9 The CMA recommends that the federal government rescind changes made to the Interim Federal Health Program until appropriate consultation and program review occur. Introduction As in other leading industrialized countries, the federal government has an important stewardship role in the effective allocation of health-related resources and health outcomes of Canadians; this is central to a productive workforce and a strong economy. This brief provides tangible, actionable recommendations on how the federal government can contribute to transforming Canada's health care system and improving the health of Canadians. The focus is on three critical areas for federal investment: a senior's care strategy; the social determinants of health and health equity; and health sector innovation and productivity. The recommendations in these areas are aligned with the CMA's Health Care Transformation initiative, the principles of which have been endorsed by 134 organizations, representing millions of Canadians.1 1. Contributing to a National Seniors Care Strategy Issue: Engagement and investment from the Government of Canada is essential to meet the increasing needs of Canada's aging population. It is expected that by 2036, a quarter of Canada's population will be over the age of 65. The number of people in the oldest age group - the age group most likely to experience serious health problems - is expected to increase at an even faster rate: Statistics Canada predicts that in 2036 there will be 2.6 times as many people 80 years old or over as there are today. 2 Already, patients age 65 or older account for nearly half of Canada's health care spending (45% in 2009).3 Canada's governments are rightly concerned about how to provide sustainable, high-quality health care to all Canadians as the country's population ages. The Canadian public shares this concern. In an Ipsos Reid public opinion survey done for CMA in July 2013, 83% of respondents said they were concerned about their health care in their retirement years. The CMA recommends the Government of Canada collaborate with provincial, territorial and municipal governments to establish and invest in a pan-Canadian strategy for seniors care. As elaborated below, the CMA recommends that this strategy include adequate investment in long-term care, home care, as well as palliative and end-of-life care to ensure access to the continuum of care. In addition, there should be investment in programs to address age-related health risks of particular concern, notably dementia and injuries due to falls. These areas, including recommendations for immediate investment by the Government of Canada are discussed in greater detail below. i) Ensure continuing care qualifies under the new Building Canada Plan4 Addressing the gap in long-term care residency options is a critical component of an integrated continuum of care strategy that provides for increased home and community supports. Communities across Canada face a common problem of a lack of resources to properly meet the housing and care needs of their seniors population. While the percentage of older Canadians who live in long-term care facilities is declining, as the aging of Canada's population accelerates, the demand for residential care will increase significantly. The current wait times in the long-term care sector are contributing to the high number of alternate level of care patients (ALC) who occupy acute care beds; a major issue facing Canada's health care system. At more than 3 million ALC days, the high number of ALC patients in hospitals is a problem experienced across the country.5 Based on the difference between the average cost of care in hospital versus long-term care, if ALC patients were moved from hospital to long-term care this would save the health care system about $2.3 billion a year. The Conference Board of Canada has produced a bed forecast tied to the growth of the population aged 75 and over and based on a decreased bed ratio demand to reflect the greater shift to community-based services and supportive housing options being advanced at the provincial level. Based on these assumptions, over the five-year period ending in 2018, an estimated 29,693 additional beds will be required, representing a pan-Canadian investment of $7.98 billion. It is evident that the existing and planned schedule of provincial projects will be unable to meet the estimated demand. Based on a review of provincial budgets, current capital investments already committed at the provincial level represent at least $861 million allocated over the next 10 years, representing approximately 3,200 new beds. The shortfall between our projected gap (29,693) and our calculation of provincial committed projects is 26,493 beds, at a cost of $7.1 billion. The CMA recommends funding for health infrastructure qualify under the next Building Canada Plan to support the construction, renovation and retrofitting of long-term care facilities. ii) Invest in a national dementia strategy About three quarters of a million Canadians currently live with Alzheimer's disease and other forms of dementia and cognitive impairment. Our knowledge of how to prevent dementia is limited. We do not fully understand its causes and there is no known cure. People with dementia may live for years with the condition and will eventually need round-the-clock care. Dementia currently costs Canada roughly $33 billion per year, both in direct health care expenses and in indirect costs such as lost earnings of the patient's caregivers. Given that the prevalence of dementia will unquestionably increase with the aging of Canada's population, the Alzheimer Society of Canada predicts that by 2040 the annual cost to the country will reach $293 billion. 6 The CMA recommends the Government of Canada invest $25 million per year over five years toward a pan-Canadian dementia strategy. This $25 million investment would be distributed as follows: - $10 million to support research on key aspects of dementia, including prevention, treatment options, and improving quality of life. - $10 million in increased support for informal caregivers. This includes both financial support and programs to relieve the stress experienced by caregivers such as education, skill-building and provision of respite care and other support services. - $5 million toward knowledge transfer, dissemination of best practices and education and training to support: - an integrated system of care facilitated by effective co-ordination and case management - a strengthened dementia workforce, which includes development of an adequate supply of specialists and improving diagnosis and treatment capabilities of all frontline health professionals. iii) Establish an injury prevention strategy for Canada Falls are the primary cause of injury among older Canadians; they account for 40% of admissions to nursing homes, 85% of injury-related hospitalizations and nearly 90% of all hip fractures. The Public Health Agency of Canada estimates that injuries among seniors cost Canada approximately $2 billion a year in direct health care costs.7 They are also a major contributor to alternate level of care patients in hospitals given the shortages in the home care, rehabilitation or long-term care sector. Falls can be prevented, and a growing number of regional programs across Canada are identifying and modifying risk factors for falls in their client population specific to seniors. The CMA recommends the Government of Canada establish a Canada-wide injury prevention strategy to identify successful programs and facilitate the sharing of knowledge and resources that will enable them to be disseminated nationwide. iv) Support the expansion of palliative care in Canada Experts believe that a palliative-care approach - when combined with treatment - leads to better outcomes by reducing the length of stay in hospitals and the number of deaths in acute care. In Canada, according to Canadian Institute for Health Information (CIHI), only 16% to 30% of patients have access to hospice palliative and end-of-life services.8 These services tend to be delivered in institutional settings on a tertiary or intensive model; and like falls prevention programs, they tend to be delivered locally. The CMA strongly supports an approach that integrates palliative care with chronic care in the community, earlier in the patient's condition. In support of a pan-Canadian palliative care strategy, CMA recommends that the Government of Canada undertake research to identify successful programs and facilitate the sharing of knowledge and resources so that they can be replicated nationwide. 2. Social Determinants of Health and Health Equity Issue: Addressing the social and economic determinants of health is critical to ensuring improved health outcomes for Canadians. Research suggests that 15% of population health is determined by biology and genetics, 10% by physical environments, 25% by the actions of the health care system, with 50% being determined by our social and economic environment.9 While a strong health care system is vital, changes to our health system alone will not be sufficient to improve health outcomes or reduce the disparities that currently exist in disease burden and health risks. Addressing the social and economic determinants of health has an important role in ensuring the sustainability of the health care system. It is estimated that one in five dollars spent on health care in Canada can be attributed to socio-economic disparities. These are the avoidable health costs linked to issues such as poverty, poor housing, health illiteracy, and unemployment among others. In 2012 health care dollars, these potentially avoided costs represented $40 billion in public spending. 10 Many of these social and economic determinants fall within the jurisdiction of the federal government such as tax policy. The section below elaborates on how the federal government can contribute to addressing the social determinants of health and reduce health inequity. i) Ensure healthy public policy Recognizing that the social and economic determinants of health have an important role in the health of Canadians, the policy decision-making process across departments must include a consideration of health. This can be accomplished by establishing health as a required consideration in the Cabinet decision-making process to ensure that the health promoting aspects of policies and programs are strengthened while potential negative impacts can be avoided or mitigated. In short it will ensure healthy public policy. Not only could health care costs be reduced, but ensuring healthy public policy has the potential to provide significant benefits for the Canadian economy. Healthier people lose fewer days of work and contribute to overall economic productivity.11 The CMA recommends the Government of Canada establish health as a required consideration in the Cabinet decision-making process. ii) Address access to prescription pharmaceuticals Universal access to prescription drugs is widely acknowledged as part of the "unfinished business" of Medicare in Canada. What exists today is a public-private mix of funding for prescription drugs. As of 2011, CIHI has estimated that 44% of prescription drug expenditures were public, 38% were paid for by private insurance and 18% were paid out of pocket.12 At present, Quebec is the only province to have universal prescription drug coverage for its residents, either through private insurance or a public plan, introduced in 1997. Of serious concern, there is evidence of wide variability in levels of drug coverage across Canada. According to Statistics Canada, almost one in 10 (7.6%) of households spent greater than 3% of after tax income on prescription drugs in 2008. Across provinces, this ranged from 4.6% in Alberta and 4.7% in Ontario to 13.3% in PEI.13 Further, 10% of the Canadian respondents to the Commonwealth Fund's 2010 International Health Policy Survey said they had either not filled a prescription or skipped doses because of cost issues.14 Research conducted by Ipsos Reid in 2012 showed that almost one in five households (18%) does not have supplementary insurance coverage that would cover prescription drugs.15 Statistics Canada's 2011 Survey of Household spending clearly shows the burden on seniors and low-income Canadians. Households headed by a person aged 65 and older spent 50% more, on average, on prescription drugs when compared with all households.16 Those in the lowest income groups are three times less likely to fill needed prescriptions.17 This has consequences not only for their health but for the health care system as well. Individuals who are unable to manage treatable conditions often end up hospitalized at a great cost to the health care system. The CMA recommends the federal government, in consultation with the provincial and territorial governments, health care providers, the life and health insurance industry and the public, establish a program of comprehensive prescription drug coverage to be administered through reimbursement of provincial/territorial and private prescription drug plans to ensure that all Canadians have access to medically necessary drug therapies. iii) Address health disparities experienced by First Nations, Métis and Inuit During a cross-country town hall consultation in Winnipeg on Feb. 4, 2013, the CMA heard about the adverse effects of inequalities and disparities and their impact on the health and wellness of First Nations, Métis and Inuit in Canada. As elaborated below, the inequalities and disparities in the social determinants of health can have a significant impact on the health of the population. First Nations, Métis and Inuit in Canada experience higher rates of chronic disease, addictions, mental illness and childhood abuse. The Health Council of Canada reports that the crude mortality rate for First Nations is higher and life expectancy lower than the Canadian average.18 In 2009, UNICEF reported that the infant mortality rate for First Nations on reserve was seven times higher than the national average.19 First Nations, Métis and Inuit peoples suffer much higher rates of infectious and chronic diseases. Tuberculosis rates are six times higher in First Nations populations and 17 times higher in Inuit communities as compared to the rest of Canada.20 Diabetes rates are higher among First Nations, Métis and Inuit peoples - 15.5% vs. just over 4.7% for the non-Aboriginal population,21 and First Nations, Métis and Inuit communities face higher rates of heart and circulatory diseases, respiratory diseases, and mental health disorders.22 Housing is a key area of concern for First Nations, Métis and Inuit. It is estimated that there will be a backlog of 130,000 housing units in First Nations, Métis and Inuit communities between 2010 and 2031, with 44% of existing units needing significant repairs and 18% requiring complete replacement.23 This inadequate housing can lead to serious health problems. The quality of housing stock directly affects health through exposure to lead, mold and other toxins that are harmful to health. Action is needed to develop an appropriate housing strategy for Canada's First Nations, Métis and Inuit that includes consideration of expiring social housing arrangements on and off reserve. Access to health care also plays a role in determining health. This can be a challenge for First Nations, Métis and Inuit. Many live in communities with limited access to health care services, sometimes having to travel hundreds of miles to access care.24 Additionally, there are jurisdictional challenges between federal and provincial delivery of health services. First Nations, Métis and Inuit living in Canada's urban centres also face significant barriers to accessing health care. Further, even when care is available it may not be culturally appropriate. Utilizing the Non-Insured Health Benefits (NIHB) program can be problematic for some First Nations. It is the CMA's understanding that funding constraints can lead to decreased quality of services, treatment delays or even in some cases denial of services. While the federal government has committed to continuing payments for the NIHB program the CMA is aware of concerns with current funding is inadequate to account for the growing native population, the addition of other beneficiaries, and the higher health care utilization as a result of the poor health status of many of Canada's First Nations.25 The CMA recommends the Government of Canada establish and invest in a comprehensive strategy for improving the health of First Nations, Metis and Inuit that involves a partnership among governments, non-governmental organizations, and Aboriginal communities. iv) Restore coverage under the Interim Federal Health Program The CMA, together with other medical, health and social organizations, have recommended that the changes to the Interim Federal Health Program be rescinded until appropriate consultation is undertaken. The purpose of this consultation would be to identify opportunities to achieve the Government of Canada's cost saving objectives while maintaining the scope of health care coverage for the program recipients. To date, this consultation has not occurred. One of the primary rationales for the program changes was an estimated cost savings of $20 million per annum in health care costs covered by the federal government. As evident by the recent statements of provincial health ministers following the Oct. 3 Federal/ Provincial/ Territorial Health Ministers Meeting, these projected cost savings are not likely to be realized. The CMA is concerned that the costs of the program have been downloaded on the provincial health systems, the charitable sector, and other public programs and organizations that provide the uninsured with benefits. Further, there has been significant confusion that has resulted in an increased administrative burden on the health sector following continual changes in this program. The CMA recommends the federal government rescind changes made to the Interim Federal Health Program until appropriate consultation and program review occur. 3. Improving Health Care Productivity and Innovation The CMA supports federal engagement to advance a health sector innovation and productivity framework, the purpose of which would be to support the introduction and expansion of innovation in health technology and processes of delivery to yield better health outcomes and productivity. As part of this framework, the CMA encourages federal focus on accountability measures and health information technology, as elaborated below. i) Accountability mechanism to improve productivity and quality care Despite the importance of the health care sector to Canada's economy and quality of life, it is generally agreed that in health care, Canada is no longer a strong performer relative to similar nations. For instance, OECD Health Data 2012 ranks Canada seventh highest of 34 member states in per capita health care spending, while Canada's health care system continues to rank below most of our comparator countries in terms of performance. 26 According to the latest forecast report by CIHI, public spending on health care was to surpass $200 billion in 2012. According to the OECD, if the Canadian health sector was to become as efficient as the most efficient countries, we could save 2.5% of GDP in public expenditure by 2017.27 The need to improve system performance will only intensify as demand for health care services increases and the system is pressed to effectively manage the rising number of Canadians with chronic diseases. While the provinces and territories have initiated steps to collaborate on the sharing of best practices in health care, federal leadership is necessary to address the overall performance of the health care system in Canada. This includes collaborating with the provinces and territories on the identification of pan-Canadian metrics that link health expenditures to nationally comparable health outcomes and system performance. CIHI does develop and collect data on numerous health indicators and has developed a performance measurement framework with an initial set of indicators coming out in the near future. However, there is currently no pan-Canadian process to set targets and monitor outcomes and system performance, the purpose of which is to demonstrate accountability to Canadians, improve health outcomes and health sector performance. The CMA recommends the federal government engage the provinces and territories in a collaborative process to identify pan-Canadian metrics and measurements that link health expenditures to nationally comparable health outcomes and system performance. ii) Maximizing the value of Electronic Medical Records The digitization of our health care system is central to quality, safety and the continuity of patient care for all Canadians. Canada continues to make progress in the adoption of health information technology (HIT). It is forecast that 70% of physicians will have an electronic medical record (EMR) system in place by 2014. Almost 90% of the most common radiology examinations and reports in Canada's acute care hospitals are now digital, up from approximately 38% only six years ago. However, there is still a long way to go in order to share information more effectively among caregivers, enable patient access to clinical information, and optimize the use of these systems. Areas where progress has stalled include: specialist EMR needs, applied research, local interoperability, decision support tools, and analytical tools. Stalled progress in these areas has meant Canadians are not benefiting at the point of care such as allowing comparisons between patients within a practice, comparing across practices, facilitating sentinel disease surveillance and a population health approach to primary care, and allowing patients to get consistent, more understandable information from their providers electronically through portals, emails and other e-routes. As we look to the future - and in particular the next three years - there's a need to reframe the discussion from building HIT infrastructure to deriving benefits. To this end, investment is required to ensure that the efforts to date are fully utilized and support improved patient outcomes. A committee comprised of CMA and Provincial Territorial Medical Associations representatives considered this issue and developed recommendation for targeted investment in HIT; these are outlined below. The CMA recommends the Government of Canada allocate $545 million as follows: * $200 million to support an additional 10,000 physicians not covered by current programs. * $200 million to support change management for EMR adoption. * $10 million to support data migration (i.e. clinics have to move to new products). * $100 million to support local interoperability solutions. * $5 million to support the Standards Collaborative. * $20 million to support research into HIT effectiveness. * $5 million to support solutions for the integration of clinical practice guidelines (CPGs). * $5 million for applied research on patient portal. This additional investment would benefit patients, providers and governments through improved patient care and improved performance of health care systems. In addition, the appropriate use of health information technology will contribute toward a more effective health care system supporting Canada's economic competitiveness. Conclusion Working with the provinces and territories and health care providers in delivering better health care to all Canadians through enhancing productivity and innovation is a policy challenge requiring federal leadership and engagement. The CMA believes the Government of Canada should act upon the recommendations included in this brief and collaborate with stakeholders to ultimately contribute to optimal health outcomes for Canadians, and health services that are delivered in a more efficient and cost-effective manner. 1 For the latest update on the Principles to Guide Health Care Transformation, visit: www.cma.ca/cma-media-releases 2 Statistics Canada. Population projections for Canada, provinces and territories 2009 to 2036. June 2010. 91-520-X 3 CIHI. Health Care in Canada, 2011, 1. 4 CMA. The need for health infrastructure. Submission to the Minister of Infrastructure, March 1, 2013. www.cma.ca/multimedia/CMA/Content_Images/Inside_cma/Submissions/2013/Health-Infrastructure_en.pdf . 5 CIHI. 2012. Health Care in Canada, 2012: A focus on wait times. 6 Alzheimer Society of Canada. A New Way of Looking at Dementia in Canada. Based on a study conducted by RiskAnalytica. C. 2010 7 PHAC. The Safe Living Guide - A guide to home safety for seniors. 2005. Revised 2011. 8 CIHI. 2013. End-of-life hospital care for cancer patients. 9 Keon, Wilbert J. & Lucie Pépin (2008) Population Health Policy: Issues and Options. Available at: www.parl.gc.ca/Content/SEN/Committee/392/soci/rep/rep10apr08-e.pdf 10 Public Health Agency of Canada (2004) Reducing Health Disparities-Roles of the Health Sector: Discussion Paper. Available at: publications.gc.ca/collections/Collection/HP5-4-2005E.pdf 11 Munro, Daniel (2008) "Healthy People, Healthy Performance, Healthy Profits: The Case for Business Action on the Socio-Economic Determinants of Health." The Conference Board of Canada. Available at: www.conferenceboard.ca/Libraries/NETWORK_PUBLIC/dec2008_report_healthypeople.sflb 12 Canadian Institute for Health Information. Drug expenditure in Canada, 1985 to 2011. Ottawa. 13 Statistics Canada. CANSIM Table 109-5012 - Household spending on prescription drugs as a percentage of after-tax income, Canada and provinces. www5.statcan.gc.ca/cansim/pick-choisir;jsessionid=4FF8F1A5D604C73873F71D9FDE6141C5. Accessed 12/10/12. 14 Commonwealth Fund. 2010 Commonwealth Fund International Health Policy Survey. www.commonwealthfund.org/~/media/Files/Surveys/2010/IHP%202010%20Toplines.pdf Accessed 12/10/12. 15 Ipsos Reid. Supplementary health benefits research. www.cma.ca/multimedia/CMA/Content_Images/Inside_cma/Media_Release/2012/ CMA-Benefits-Research-Survey_en.pdf. Accessed 12/10/12. 16 Statistics Canada. CANSIM Table 203-0026. Accessed 06/18/13. 17 Mikkonen, Juha & Dennis Raphael (2010) Social determinants of Health: The Canadian Facts. Available at: http://www.thecanadianfacts.org/The_Canadian_Facts.pdf 18 Health Council of Canada, "The Health Status of Canada's First Nations, Métis And Inuit Peoples", 2005, online: http://healthcouncilcanada.ca.c9.previewyoursite.com/docs/papers/2005/BkgrdHealthyCdnsENG.pdf Accessed October 20, 2010. 19 National Collaborating Centre for Aboriginal Health & UNICEF Canada "Leaving no child behind - national spotlight on health gap for Aboriginal children in Canada" 2009, online: www.nccah-ccnsa.ca/s_140.asp Accessed November 20, 2009 20 Health Council, supra note 34. 21 NWAC, 2009, supra note 39. 22 Canada, Health Canada, First Nations, Inuit and Aboriginal Health, (Ottawa: Health Canada), online: www.hc-sc.gc.ca/fniah-spnia/pubs/index-eng.php Accessed November 4, 2009 23 Assembly of First Nations (2013) Taking Action Together on Shared Priorities Towards a Fair and Prosperous Future: AFN Submission to the Council of the Federation. Available at: www.afn.ca/uploads/files/13-07-23_afn_submission_to_cof_2013.pdf 24 Bowen, S. Access to Health Services for Underserved Populations. 25 Assembly of First Nations (2011) Structural Transformation & Critical Investments in First Nations on the Path to Shared Prosperity. Pre-Budget Submission, 2011. Available at: www.afn.ca/uploads/files/2011-pre-budget-submission.pdf 26 OECD Health Data 2012 - www.oecd.org/health/healthgrowthinhealthspendinggrindstoahalt.htm 27 OECD, Economic Survey of Canada 2012. www.oecd.org/eco/surveys/economicsurveyofcanada2012.htm
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Letter - CMA’s 2006 Pre-Budget Submission to the Minister of Finance

https://policybase.cma.ca/en/permalink/policy2031
Last Reviewed
2013-03-02
Date
2006-04-19
Topics
Health human resources
Health systems, system funding and performance
  1 document  
Policy Type
Parliamentary submission
Last Reviewed
2013-03-02
Date
2006-04-19
Topics
Health human resources
Health systems, system funding and performance
Text
On behalf of the Canadian Medical Association (CMA), I am pleased to present you with our pre-budget submission for your government's consideration. The CMA appreciates the opportunity to provide input into this government's first budget and to identify strategic investment opportunities for the long term health of Canadians. While Canada's health system faces many challenges, we believe that immediate action by the federal government in four key areas will offer both short term and long term benefits. They are: (1) the establishment of a Canada Health Access Strategy to support a patient wait-times guarantee; (2) a proposed Visa position buyback program and a repatriation program to immediately address shortfalls in health human resources; (3) a strengthening of Canada's public health infrastructure; and (4) a remedy for GST-induced distortions in the health care system.We believe these proposals fit well with the government's stated priorities. While information on each of these recommendations is attached for your information and consideration, I would like to provide you with an overview of each. 1. CANADA HEALTH ACCESS STRATEGY The CMA has been advocating for the implementation of maximum wait time thresholds or care guarantees for a number of years and is pleased that the government has included this as one of its top five priorities. As a first step, the CMA worked with six other specialty societies as part of the Wait Times Alliance (WTA) to develop a set of pan-Canadian wait-time benchmarks or performance goals released last August. We believe this work served as a catalyst for the provincial and territorial governments to move some way toward meeting their commitment in announcing pan-Canadian wait-time benchmarks last December. We must continue to work with governments and the academic community to improve access to medical care beyond the five priority health issues identified in the First Ministers' 2004 10-year health care plan. The second step in implementing patient wait-time guarantees is the issue of honouring the commitment and providing for patient recourse. As a member of the WTA, the CMA strongly supports accelerating the timetable to reduce wait times nationwide. However, the federal government needs to do its part to assist provinces in advancing the timetable by stepping up the flow of funds earmarked for the last four years of the accord. Our proposed Canada Health Access Strategy is comprised of three components directed at making this happen: supporting provinces to expand capacity and to handle surges in demand; supporting the creation of regional and/or national referral networks; and establishing a Canada Health Access Fund for a "safety valve" to help Canadians access care elsewhere when necessary. Details on how this Strategy would work are attached. The point is that this Strategy is necessary to assure Canadians that they get the care they need when they need it. Recommendation 1. The federal government advance the remaining $1 billion from the 2004 First Ministers Accord that was originally intended to augment the Wait Times Reduction Fund (2010-2014) to support a Canada Health Access Strategy by: (a) expanding provincial surge capacity : $500 million to be flowed immediately to provinces on a per capita basis in return for agreement to accelerate the timetable for bringing down wait times, as was promised in the recent federal election campaign; (b) improving national coordination of wait time management: $250 million to support creation of regional and/or national referral networks, a more coordinated approach to health human resource planning, expansion of information technology solutions to wait time management and facilitation of out-of-country referrals; and (c) establishing a Canada Health Access Fund: $250 million initial investment in an alternative patient recourse system or "safety valve" when and if clinically-indicated maximum wait time benchmarks as agreed to by provinces/territories last December are exceeded. Addressing Shortfalls in Health Human Resources As identified by Minister Clement in a recent speech at the "Taming of the Queue III" wait-time conference, addressing shortages in health human resources is a key element of any strategy for reducing lengthy wait-times. Unfortunately, we face serious physician shortages, starting with family physicians. The bad news is that it can take several years to educate and train the necessary professionals. The good news is that there are some strategies that can be undertaken to address the situation in the short term. 2. VISA POSITION BUYBACK FUND One such strategy is our Visa Position Buyback proposal that would eliminate the backlog of 1,200 qualified international medical graduates (IMGs) over the next five to seven years. Currently, these qualified IMGs, who are either Canadian citizens or landed immigrants, are unable to access the necessary residency training. One existing source for training capacity exists with the positions purchased by foreign governments for visa trainees. We estimate that there are over 900 current visa trainees at all rank levels. By implementing the Visa Position Buyback program, the government is able to take an immediate step that will produce tangible results as soon as a two to four years from now. This initiative would be part of a longer term plan to fully address the shortages in health human resources and help the government meet its commitment to implement a properly functioning patient wait-time guarantee. Recommendation 2a. The federal government allocate $381.6 million toward the training of up to 1,200 IMGs through to practice over the 2007/08 to 2015/16 period. Funding would be made available in two installments: an immediate investment of $240 million and the remaining $140 million subject to a satisfactory progress report at the end of five years. Repatriate Health Professionals Working in the United States Fortunately, another short-term source of health professionals exists that Canada should pursue. Thousands of health care professionals are currently working in the United States including approximately 9,000 Canadian trained physicians. We know that many of the physicians who do come back to Canada are of relatively young age meaning that they have significant practice life left. While a minority of these physicians do come back on their own, many more can be repatriated in the short-term through a relatively small but focussed effort by the federal government led by a secretariat within Health Canada. Recommendation 2b. The federal government should establish a secretariat within Health Canada that would provide funding to national professional associations to conduct targeted campaigns to encourage the repatriation of Canadian health professionals working in the United States, and act as a clearinghouse on issues associated with returning to Canada (e.g., citizenship, taxation, etc.). 3. PUBLIC HEALTH INFRASTRUCTURE RENEWAL The CMA remains concerned about the state of Canada's public health system. Public health, including the professionals providing public health services, constitutes our front line against a wide range of threats to the health of Canadians. While there is much talk about the arrival of possible pandemics, Canada's public health system must be ready to take on a broad range of public health issues. The CMA has been supportive of the Naylor report which provides a blue print for action and reinvestment in the public health system for the 21st century. While this will take several years to achieve, there are some immediate steps that can be taken which will lessen the burden of disease on Canadians and our health care system. These steps include establishing a Public Health Partnership Program with provincial and territorial governments to build capacity at the local level and to advance pandemic planning. In addition, we call on the government to continue its funding of immunization programs under its National Immunization Strategy. Recommendation 3a. The federal government should establish a Public Health Infrastructure Renewal Fund in the amount of $350 million annually to establish a Public Health Partnership Program with the provincial/territorial governments for the purposes of building capacity at the local level and advancing pandemic planning. In addition, the $100 million per year for immunization programs under the National Immunization Strategy should be continued. 4. A REMEDY FOR GST-RELATED DISTORTIONS IN THE HEALTH SYSTEM The CMA and many other national health organizations are concerned about the increasing, unintended and negative consequences the GST is having on health care. For example, the 83% rebate originally provided for under the so-called "MUSH" formula is no longer tax neutral and is acting as a deterrent in some cases toward increased use of ambulatory care services such as day surgeries. Over the past 15 years the physicians of Canada have faced a large and growing unfair tax burden due to the GST. Since physicians' services are tax exempt under the law, physicians are unable to either claim input tax credits or pass on the tax because of the prohibition under the Canada Health Act of billing patients directly. This puts physicians in a unique and patently unfair catch 22 that now amounts to over $65 million per year, which further acts as a deterrent to repatriating or retaining Canadian physicians. Recommendation: 4a. That the federal government, in the course of reducing the GST from 7% to 5% further to its campaign commitments, remove the large and growing deterrent effects of the GST on the efficient and effective delivery of health care in Canada. In summary, the CMA is providing you with recommendations on strategic investments to help your government honour its commitment to timely access to care and to improve the health of Canadians. Our recommendations are financially reasonable, making good use of Canadians' tax dollars. We look forward to meeting with you on April 19 to discuss our proposals with you. Sincerely, Ruth L. Collins-Nakai, MD, MBA, FRCPC, MACC President c.c. The Honourable Tony Clement, Health Minister
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Submission on Bill C-462 Disability Tax Credit Promoters Restrictions Act. Submitted to the House of Commons Standing Committee on Finance

https://policybase.cma.ca/en/permalink/policy14026
Date
2013-05-22
Topics
Health systems, system funding and performance
Physician practice/ compensation/ forms
  1 document  
Policy Type
Parliamentary submission
Date
2013-05-22
Topics
Health systems, system funding and performance
Physician practice/ compensation/ forms
Text
The Canadian Medical Association (CMA) is pleased to present this brief to the House of Commons Standing Committee on Finance regarding Bill C-462 Disability Tax Credit Promoters Restrictions Act. The Canadian Medical Association represents 78,000 physicians in Canada; its mission is to serve and unite the physicians of Canada and to be the national advocate, in partnership with the people of Canada, for the highest standards of health and health care. The CMA is pleased that the House of Commons has made Bill C-462 a priority. This bill is an important step toward addressing the unintended consequences that have emerged from the Disability Tax Credit since 2005. Part 2: Issues to be addressed In 2005, the Disability Tax Credit was expanded to allow individuals to back-file for up to 10 years. While this was a welcome tax measure for individuals with disabilities, the CMA has been urging the Canada Revenue Agency to address the numerous unintended consequences that have emerged. Central among these has been the emergence of a “cottage industry” of third-party companies engaged in a number of over-reaching tactics. The practices of these companies have included aggressive promotional activities to seek and encourage individuals to file the Disability Tax Credit. The primary driver behind these tactics is profit; some companies are charging fees of up to 40 per cent of an individual’s refund when the tax credit is approved. Further to targeting a vulnerable population, these activities have yielded an increase in the quantity of Disability Tax Credit forms in physician offices and contributed to red tape in the health sector. In some cases, third parties have placed physicians in an adversarial position with their patients. We are pleased that this bill attempts to address the concerns we have raised. The CMA supports Bill C-462 as a necessary measure to address the issues that have emerged since the changes to the Disability Tax Credit in 2005. However, to avoid additional unintended consequences, the CMA recommends that the Finance Committee address three issues prior to advancing Bill C-462. First, as currently written, Bill C-462 proposes to apply the same requirements to physicians as to third-party companies if physicians apply a fee for form completion, a typical practice for uninsured physician services. Such fees are subject to guidelines and oversight by provincial and territorial medical regulatory colleges (see Appendix 1: CMA Policy on Third Party Forms: The Physician Role). The CMA recommends that the Finance Committee: 2 Amend the definition of “promoters” under section 2 to exclude “a health care practitioner duly licensed under the applicable regulatory authority who provides health care and treatment.” If the committee imports the term “person” from the Income Tax Act, then the applicable section of Bill C-462 should be amended to specify that, for the purposes of the act, “Person does not include a health care practitioner duly licensed under the applicable regulatory authority who provides health care and treatment.” Second, the CMA is concerned that one of the reasons individuals may be engaging the services of third-party companies is a lack of awareness of the purpose and benefits of the Disability Tax Credit. Additional efforts are required to ensure that the Disability Tax Credit form (Form T2201) be more informative and user-friendly for patients. Form T2201 should explain more clearly to patients the reason behind the tax credit, and explicitly indicate there is no need to use third-party companies to submit the claim to the CRA. The CMA recommends that the Finance Committee: Recommend that the Canada Revenue Agency undertake additional efforts to ensure that the Disability Tax Credit form is more informative, accessible and user-friendly for patients. Finally, the CMA recommends that a privacy assessment be undertaken before the bill moves forward in the legislative process. It appears that, as written, Bill C-462 would authorize the inter-departmental sharing of personal information. The CMA raises this issue for consideration because protecting the privacy of patient information is a key duty of a physician under the CMA Code of Ethics. Part 3: Closing The CMA encourages the Finance Committee to address these issues to ensure that Bill C- 462 resolves existing problems with the Disability Tax Credit while not introducing new ones. The CMA appreciates the opportunity to provide input to the Finance Committee’s study of this bill and, with the amendments outlined herein, supports its passage.
3 Summary of Recommendations Recommendation 1 The definition of “promoters” under section 2 of Bill C-462 should be amended to exclude “a health care practitioner duly licensed under the applicable regulatory authority who provides health care and treatment.” Recommendation 2 If the Committee imports the definition of “persons” from the Income Tax Act, the applicable section of Bill C-462 should be amended to specify that, for the purposes of the act, “Person does not include a health care practitioner duly licensed under the applicable regulatory authority who provides health care and treatment.” Recommendation 3 The Canada Revenue Agency should undertake additional efforts to ensure that the Disability Tax Credit form is informative, accessible and user-friendly. Recommendation 4 Prior to advancing in the legislative process, Bill C-462 should undergo a privacy assessment.
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