What's wrong with a little privatization?

The Alberta government wants you to believe that the best way to save Medicare is to allow more private-sector competition within the system. On the surface, this may sound harmless enough. What damage could a little privatization really do?

But the reality is that numerous privatization schemes have been tried around the world - and they've all been costly failures. Consider these examples:

United States

• The United States has the most highly privatized health system in the industrial world. But this market-dominated model has not saved Americans money. Costs for health care in the U.S. are the highest in the world and have increased much more rapidly over the past 20 years than countries with public systems.

• Americans now spend an average of $3,701 (US) per capita for a system where 43 million people have no health coverage and another 50 million have inadequate coverage. This compares to Canada where we spend a total of about $2,050 (US) per capita for a system in which everyone is covered.
  

Britain

• In the 1980s the Conservative government of Margaret Thatcher weakened Britain's National Health Service (NHS) by using tax dollars to help create a parallel, for-profit health system. Private companies have been contracted to provide public health services (much like the system envisaged under Alberta's Bill 11).

• Thatcher said private health care would lower costs and reduce waiting lists in the public system. But the opposite happened: costs sky-rocketed and waiting lists grew longer. At the same time, administrative costs have jumped from 6 percent of the budget to more than 18 percent.
  

Australia

• During the 90s, Australia hired a private company - Healthcare of Australia - to build and operate the Port Macquarie Base Hospital, one of the biggest hospitals in the state of New South Wales.

• According to the state's auditor general, the government could have saved $93 million (Aus.) by building the Macquarie hospital itself. The auditor's report also shows that the hospital now costs $6 million (Aus.) more to run each year than if it were publicly operated. Other private hospitals in other Australian states have had similarly poor track records.
  

Private Health Care Fails in Canada Too

You don't have to go outside Canada to find evidence about the pitfalls of privatization in health care. Consider these examples from Alberta and Ontario:

Calgary - Privatization leads to longer waits

• In Calgary - where 100 per cent of cataract surgeries are now performed in private clinics - patients waited an average of 16 to 24 weeks for treatment.

• In Edmonton, where 80 per cent of cataract surgeries are done in public hospitals, waiting lists were five to seven weeks long.

• In Lethbridge - where 100 percent of cataract operations are performed in the public system - patients waited an average of only four to seven weeks.
  In other words, people living in regions with a higher proportion of private surgeries actually wait longer for treatment than people living in regions where operations are still performed within the public system. Clearly, the argument that private health care "relieves pressure" on the public system is false.

Ontario - Longer Waits and Higher Costs With Privatization

In a bid to reduce waiting lists, the Ontario government recently hired a for-profit company called Canadian Radiation Oncology Services to provide radiation treatments for cancer patients. But after more than a year of operation, the private company failed to improve upon the record of the public system - patients were still waiting as long as they always had.

To top things off, Ontario's Auditor General, Erik Peters, revealed that the private clinic was costing taxpayers $3,500 per patient - $500 more than the cost of treating patients in the public system.

Why won't private health care work?

Spokespeople for the government are fond of saying that privatization will "relieve pressure" on the public system, helping to control costs and reduce waiting lists. But, in the real world, these benefits have never materialized. Why is it exactly that private health care doesn't work?

• Private hospitals and clinics cost more because, unlike public facilities, they need to set aside significant amounts of money for things like investor profits, marketing and taxes (which public hospitals don't pay). As a result, only a small proportion of each dollar spend in private facilities actually goes to patient care. In contrast, almost all the money spent in the public system goes directly to front-line care.

• Private health care creates longer waiting lists by siphoning personnel and resources way from the public system. Doctors and other professionals are lured away from the public system by higher salaries in the private sector. The resulting staff shortages in the public system lead to longer waits for treatment, not shorter ones.

Don't take our word: Experts give "thumbs down" to private health care

"No health care system in the industrialized world is as heavily commercialized as (the U.S.'s), and none is as expensive, inefficient and inequitable - or as unpopular. Indeed just about the only parts of U.S. society happy with our current market-driven health care system are the owners and investors in the for-profit industries now living off the system &Many of us south of the border have always believed that you Canadians had the right idea in deciding that the financing of health care is primarily a public responsibility. We still think you're right and that we ought to emulate you, rather than vice versa."

Dr. Arnold S. Relman, Professor Emeritus of Medicine and Social Medicine at the Harvard Medical School, former editor-in-chief of the New England Journal of Medicine.

Why won't they learn?

These are literally roomfuls of information showing that privatization in health care doesn't make sense from any standpoint - either economic or ethical. The question is: why won't our government learn from these failed experiments in "market medicine"? Why are they still so attached to the idea of privatization when it's clear it won't work?

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