Fraser Forum Senator Sanders—and much of the media—incorrectly sell single-payer as only path to universal health care

From Bacchus Barua of the Fraser Institute.

"“There is so much to be learned and we will take back what we learned here and what we learned about the Canadian health-care system to the United States Congress and to the American people,” said U.S. Senator Bernie Sanders (pictured above) during his recent speech at the University of Toronto.

Of course, many Canadians were quick to congratulate themselves for the high praise received. Unfortunately, not only is Senator Sanders taking lessons from a universal health-care system that receives only mediocre value for the amount it spends, but his increased advocacy for a single-payer system suggest that he’s learning the wrong lessons.

Let’s start with some basics. The pursuit of universal health insurance coverage in no way necessitates a single-payer government monopoly. And yet, Senator Sanders, his tour guides, and much of the media continue to use the terms interchangeably—selling their single-payer vision as the only path to universal health care.

Sure, of the 29 members of the OECD—a group of economically developed countries—considered having achieved universal or near universal health-care insurance coverage for core services in 2015, some (such as Canada) use a single-payer approach. However, others (such as Switzerland and the Netherlands) rely on regulated, but competitive, private health-care insurance markets. In fact, many countries use a blend of public and private insurers and providers because they understand that the focus should be on the goal of universal access regardless of ability to pay, not on requiring a government monopoly over health-care financing and services.

While this is certainly the most egregious conflation of terms that continues to plague health-care debates in Canada and the United States, the senator is guilty of other misunderstandings.
For example, he is often quoted marvelling that Canada’s government is able to ensure universal insurance coverage for its population at 50 per cent of what the U.S. spends on health care (presumably on a per capita basis, adjusted for purchasing power parity or ppp). While this is true, it does not inform us about the relative efficacy of a single-payer system such as Canada’s compared to more blended multi-payer universal health-care systems, for at least three reasons.

First, the U.S. simply spends more on health care (per capita, and as a percentage of its economy) than every developed country in the world, period. So while it’s true that at US$4,753 per capita (ppp), Canada spent about half of what the U.S. did ($9,892) on health care in 2016, so did Australia ($4,708), Germany ($5,551) and the Netherlands ($5,385)—all of which allow for private-sector involvement to a far greater extent than Canada. In fact, the Netherlands largely relies on a mandatory and competitive private insurance system with a public safety-net—similar in a number of ways to what the U.S. has presently after the introduction of the Affordable Care Act (although distinctly different in a variety of ways as well).
Second, while the figures above include public and private spending, even if we examined just the amount of money the U.S. already spends on public health care (Medicare, Medicaid, Veterans Administration, etc.), at a cost of $4,860 it’s already more than what Canada spends on public and private health care combined ($4,753). So the notion that expanding government control over the rest of its health-care system would allow the U.S. to bring total health-care costs down to Canada’s level is illogical.

Finally, the non-monetary costs of Canada’s single-payer system (as a result of rationed care) are often ignored. These costs are manifested most clearly in the form of the long wait times Canadians endure for medically necessary care.

In 2016, Canadians could expect to wait 20 weeks between referral to treatment, averaged across 12 major specialities. In some provinces, patients could expect to wait for more than a year to receive treatment from an orthopaedic or neurosurgeon. While defenders of the status-quo acknowledge the presence of such waits, they often brush them aside as little more than minor inconveniences. However, physicians repeatedly indicate that their patients wait longer than what they consider clinically reasonable.

There are also other unseen consequences in the form of patients being in pain, unable to work or experiencing increasing difficulty as their conditions deteriorate while they wait for treatment. In fact, a recent study pegged the personal economic cost of lost wages and time at approximately $1,759 per patient in Canada (and up to $5,360, if you include time lost outside the work week).

By contrast, patients in Australia, Germany and the Netherlands report much shorter wait times for treatment across the board. As mentioned previously, they too spend about half of what the U.S. does on health care, but—unlike Canada—ensure universal access to care through a blended system involving public and private insurers and hospitals.

While it’s always encouraging to see U.S. senators such as Bernie Sanders striving to improve access to health care in the U.S., he would be better served by visiting universal health-care countries that get better value for their health-care dollars than Canada.

Importantly, rather than suggest that “[t]he only long-term solution to America's health-care crisis is a single-payer national health-care program,” he should set his sights on creating the best health-care system possible for Americans, irrespective of whether it is achieved through government or private means."