Sunday, May 15, 2011

I'll have a large Tim Horton's health care please

During recent election speeches and in his first election TV ad, NDP leader Jack Layton has made much of the fact that a BC hospital emergency department was so overwhelmed by demand in late February that four patients were triaged in the hospital’s Tim Hortons location.  While opposition politicians have trumpeted this as a failure by the government to spend enough on health care, sound economic second thought should recognize that Canadians would stand to benefit greatly if health care was offered by institutions that operated as well as the iconic coffee shop chain.

A distinguishing and crippling feature of our current health care system is its socialist structure.  A brief examination of the principles of the Canada Health Act them reveals why the system is built to fail.  One principle states that all administration of provincial health insurance must be carried out by a public authority on a non-profit basis. The fatally flawed implication here is that profit is a bad thing, when in fact the existence of profit in a business service is the clearest possible signal that consumers value the service and want more of it.  The Tim Hortons web site says, “the chain is dedicated to satisfying the changing tastes of guests through continuous product innovation. As consumer tastes grow, so do the choices.” In 2009 the company showed profits of a few hundred million dollars from their 3,750 locations.  It is clear that Canadians voted in massive numbers, through their own individually hard-earned dollars, to support the business of Tim Hortons over those of their competitors.  If others offer you a better product, you will certainly abandon Tim’s and shift your dollars elsewhere.  To thrive, the company must remain at the leading edge of innovation in both products offered and operational excellence.  If the company failed, you would not mourn its passing as it would imply that an even better business is available.

The second principle of the Act is that of comprehensiveness, meaning all necessary health services, including hospitals, physicians and surgical dentists, must be insured. This deliberately excludes a vast portion of the actual health care services available to and necessary for Canadians, with dentists, physical therapists, chiropractors, podiatrists, opticians, ambulances prescription medication and others as prominent examples of health services deemed unnecessary by the Act.  Many Canadians buy health insurance to fill this gap, and in my own household we pay about $300 per month for family health and dental coverage.  This helps pay for, although it certainly does not cover all the costs associated with helping us see clearly using glasses and contact lenses, treat our occasional illnesses through medication, handle our back and next pain through chiropractic care, moderate the damage of bunions through podiatry or even maintain oral hygiene and general health through regular dental care.  In fact, although we are forced to pay for it through our taxes, we, like most Canadians, access public health care less frequently than private health care.

What is our experience with private health care?  Well, the team at Place D’Orleans Dental is super-efficient, friendly, knows each of us well and keeps up with our life changes while providing us with state of the art services.  The modern and efficient services at Shoppers Drug Mart located at multiple convenient locations all over town can fill prescriptions quickly and refills can be prepared in advance of pickup with a self-service phone call. Non-prescription health products are abundant and inexpensive.  Dr. Lawrence and his staff at the Broadview Spine and Health Centre quickly diagnosed my sciatic problem a few years ago, explained that treatment would likely be highly effective and promptly proceeded to eliminate a debilitating and progressive pain and mobility problem, with periodic maintenance avoiding all recurrence and other problems since then.  The fine people at Lenscrafters in Place D’Orleans periodically and quickly manufacture and custom-fit glasses for us that are always stylish while improving in quality and durability.  Though we have not yet used it, the near-miraculous corrective laser eye surgery can be done extremely safely in mere minutes at an amazingly low price.

The third principle of the Canada health Act is universality, meaning all insured residents are entitled to the same level of health care.  This sounds nice in theory, but when implemented through a centrally controlled, profitless system it leads to vast inequities.  People who know how the system works are able to exploit it much better than those who do not.  Long waits for basic attention from a harried professional is common, diagnosis can take months and treatment even longer.  The monopoly system administration mostly sees you as an expense, a financial drain on resources, a thing to be dealt with and discharged as soon as possible instead of a valued customer whose satisfaction is the primary goal and whose time is too valuable to waste.  If your dentist treated you like this you would quickly select another one from the abundant supply.  If your family has the financial means after paying your tens of thousands in taxes each year, you may bypass the inefficient public system and buy the care you need elsewhere. 

The final principle of the Act I want to address is accessibility, that says all insured persons have reasonable access to health care facilities and all physicians, hospitals, etc, must be provided reasonable compensation for the services they provide. A core problem in a centrally controlled service operating in the absence of the vital information provided by a price system is that it is nearly impossible to operate with even a moderate degree of efficiency.  The usual free-market intelligence signals that tell entrepreneurs where to locate, what customers want to buy and how to provide service most efficiently are virtually absent.  Consequently, Canadians often encounter aging structures, antiquated facilities, rushed and impersonal services and incomplete care.  In a free market there is constant adaptation to customer preferences, powerful reward for innovation and improvement, a burning desire to gain and retain business relationships, efficient communication, on-time scheduling, adoption of the latest technology and steadily improving value for the dollar.  The full decision-making ability of every consumer and entrepreneur is harnessed most efficiently into an infinitely complex web of information flow. A centrally controlled government monopoly has only a tiny fraction of this information to work with and is inevitably less effective.

If only the entire Canadian health care system was run the way Tim Hortons runs its business and competes effectively with all-comers, then Canadians would have inexpensive access to all the health care they could buy.  Tim Hortons health care?  Bring it on Jack!

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