In March of this year, New Brunswick's health minister suggested that the province's health-care system might consider the privatization of some services because the spending of $5.5 million a day on health services is not sustainable and healthcare costs in the province are reported to be going up by seven per cent a year.


Health Minister Mike Murphy wonders if the private sector could have a role in making the province's system more efficient.


No decisions have been made, no policies announced. It's a matter of public musing and discussion but the options are being evaluated. One option is a fee-for-service system. Others include the sub-contracting of delivered services, the consolidation of hospitals and a state-of-the-art ambulance delivery system.


In May, the Minister confirmed that some private-sector clients are paying to use hospital facilities in New Brunswick. "Third parties are using facilities” on a minimal basis said Murphy. Those third parties include the Workplace Health and Safety Commission and plastic surgeons.


The Minister said when labs and equipment aren't being used and funded by Medicare; the province could be renting them out to private-sector users to generate funds to use for public care. There may be some issues with that premise if publicly paid doctors are moonlighting after hours or cutting short their public service to earn money in the private sector.


I admire the Minister’s initiative in searching for ways to reduce the cost of delivering healthcare in New Brunswick. However, the renting of facilities and sub-contracting services to the private sector only makes sense if

• (a) standards of care are maintained or improved


• (b) there is no penalty to the public system and,


• (c) the cost to taxpayers is no greater than provision of care by the public system.

Private sector businesses and services function in response to profit need and shareholder return. That tends to drive cost up, not down.


The Americans operate a for-profit healthcare system. It’s the most expensive in the world.


In April this year, former President Bill Clinton told an audience in San Francisco that the U.S. "Healthcare system is immoral because it doesn't provide health care to everybody," Clinton said then "It's wildly uneconomical. We pay more than everybody else in the world for less."


Clinton said the United States spends 16 percent of its national income on health care, compared with 11 percent in Canada and Switzerland, the countries with the next highest spending. Forty five percent more in cost, yet the United States ranks only 37th in the world in overall health care, insures fewer of its citizens and pays more for its drugs. Nearly a third of U.S. health care spending goes to administrative costs, the highest in the world.


Clinton does not deny that some Americans have access to excellent health care, saying the success of his 2004 emergency quadruple heart bypass surgery makes him "a walking miracle."


But he said his case is also an example that not enough is being done on the prevention side. "We are great about treating sickness, but we are lousy at keeping people well," said Clinton, who also is working on the issue of childhood obesity.


The U.S. health care system ranks last among other major rich countries for quality, access and efficiency, according to two studies released in May by a health care think tank. The studies by the Commonwealth Fund found that the United States underperforms consistently relative to other countries.


"The United States stands out in these studies as the only nation that does not ensure access to health care through universal coverage and promotion of a 'medical home' for patients," said Commonwealth Fund president Karen Davis.


The U.S. ranked last in patient safety, timeliness of care, efficiency and equity. Americans were also last in terms of whether they had a regular physician. "The U.S. spends twice what the average industrialized country spends on health care but they're clearly not getting value for the money," said Davis.


She also noted that 45 million Americans or 15 percent of the U.S. population have no health insurance, which contributes to the country's medical woes.

It is estimated that 18,000 Americans die annually due to lack of insurance - a rather harsh outcome of healthcare rationing. Canadians provide healthcare for every citizen and enjoy longer, healthier lives than Americans, despite spending far less for healthcare than people in the United States. Canadians are quick to complain about wait-times for healthcare services but the fifteen percent of Americans (significantly more people than the total population of Canada) who do not have healthcare insurance wait much longer.

Reuters News Agency also reported in May that U.S. hospitals charge uninsured patients about two-and-a-half times more than those with health insurance. Hospital patients without health insurance and others who pay for medical care out of their own pockets were charged an average 2.57 times more than those with health insurance confirmed a study published in Journal Health Affairs in its May-June issue.

Hospitals in the United States set rates based on a formula that inflates prices in the belief they will come down during the negotiation process between healthcare providers and insurers. For-profit hospitals had the highest discrepancy between costs estimated by Medicare and prices charged, the study found.

Patients without health insurance lack the ability to negotiate. Hospitals defend the practice of up-charging non-insured patients by noting the fact they only recover about 10 cents on the dollar charged to uninsured patients.

A recent Harris Interactive poll of patients in the leading industrial societies of the world found that Canada ranked first and the United States last in patient satisfaction with health care.


In his search for efficiency and rationalization in New Brunswick’s healthcare system, Mike Murphy should be careful that he doesn’t throw out the baby with the bathwater.

W.E. (Bill) Belliveau is a Shediac resident and Moncton business consultant. He can be contacted at bill.bellstrategic@nb.aibn.com Atlantic Insight is a published Blog inventory of opinion articles published weekly in New Brunswick's print media as written by W.E. (Bill) Belliveau, who is a resident of Shediac, New Brunswick, and small business owner, operating his Moncton-based marketing consultancy, Bell Strategic. He can be reached by e-mail at bill.bellstrategic@nb.aibn.