No need to choose between lower taxes and health care

Failings of the health system are not due to chronic underfunding

Michel Kelly-GagnonIf Quebec voters have one concern during the current election campaign, and just about every election campaign for decades now, it’s the health-care system.

Contrary to what many commentators have been claiming for years, the failings of the health system are not due to “chronic underfunding.” For this reason, the notion that lower taxes would necessarily lead to a worse health system is seriously flawed.

Quebec’s health care system is ailing. Wait times in ERs are among the worst in the Western world. The wait to get a family doctor is sky high (and for the lucky ones who have a GP, getting an appointment is often a trial). But is this due to a lack of money? Absolutely not. The numbers (from various sources and for several time periods) are clear.

In 2021, Quebec’s health care budget was $47 billion, more than double what it was in 2000 (in constant dollars, which is to say, accounting for inflation). Yes, you read that right: Health care spending more than doubled in 20 years! (Moreover, according to the economic literature the hypothesis that the aging population would wholly or very largely justify this increase does not hold water.)

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KEEP AN EYE ON QUEBEC

According to CIRANO, an academic research centre affiliated with the Université de Montréal, public health spending rose by around 32.2 per cent, in constant dollars, just from 2004 to 2019.

According to the Canadian Institute for Health Information (CIHI), there has not been any general disinvestment in health care in Quebec or Canada. Indeed, total health care spending as a percentage of GDP went from just over nine per cent in the early 2000s to 11.5 per cent in 2019. In other words, as a proportion of our collective wealth, we are spending more on health care, not less.

The organization that I head, the Montreal Economic Institute, has also shown that from 2008-2009 to 2016-2017, health spending rose from $30.6 billion to $36.4 billion, again in constant dollars. This growth was faster than population growth.

In fact, out of 28 countries, Canada ranks second in terms of the portion of GDP spent to finance its health care system – despite mediocre results on several key indicators, according to OECD and Commonwealth Fund data.

Many of the jurisdictions that outperform Quebec in various rankings comparing the efficiency of the health care systems of industrialized countries actually have a lower tax burden than Quebec. Saying tax cuts would be at the expense of the quality of public health services is, therefore, a false dichotomy.

In 2017, the Health and Welfare Commissioner (a position since eliminated) summed up the situation well: “The system’s difficulties do not seem related to an insufficient budget or a lack of human resources, and still less to a lack of material resources. It would instead be related to the organization of care and services and the allocation of financial and human resources.”

Quebecers deserve a much better health-care system. But they deserve tax cuts, too. Getting both is entirely possible as long as the government that’s elected on Oct. 3 has the courage to undertake real reforms based on the following four broad pillars:

  1. competition among care providers
  2. patient freedom of choice
  3. the introduction of entrepreneurship that results in innovation, and
  4. hospital funding that follows the patient.

Finally, can we please stop brandishing the American scarecrow? Social-democratic countries – consider Sweden, Denmark or Germany – that offer, in some instances, more complete universal coverage than Quebec respect and vigorously apply these four broad principles.

Let’s hope the Quebec intelligentsia will decide, one fine day, to go beyond the simplistic and superficial cliches they constantly throw at us. What we need is a calm, factual, logical debate.

Michel Kelly-Gagnon is President and CEO of the Montreal Economic Institute.

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