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Swedes' U-Turn on Private Care

Voters quickly shut down experiment. Did Premier Campbell take notes?

By Tom Sandborn 20 Mar 2006 | TheTyee.ca

Tom Sandborn was born in Alaska and raised in the wilderness by wolves. Later, Jesuits at the University of San Francisco and radical feminists in Vancouver generously gave time and energy to the difficult task of educating and humanizing him. Tom has a formal education, too: a BA from UBC. He has been practicing the dark arts of journalism off and on ever since university, and now also has about five decades of social justice, peace and environmental campaigning under his belt.

Tom's goal is to live up to the classic definition of a journalist's job from H. L. Menken - to comfort the afflicted and afflict the comfortable.

Reporting Beat: Labour and social justice, health policy, and occasionally environmental issues.

What is the most important issue facing British Columbians?: Two key issues face BC residents (and they're both so compelling and complex that Tom refuses to rank them): income equality and environmental degradation. Both desperately need solutions.

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[Editor's note: This is the third in a series on health care reform issues in European countries Premier Campbell recently visited.]

Members of BC's Haisla First Nation returned from Sweden with a totem pole stolen from their territory early in the last century. Much less is known about what BC's premier brought back from his recent visit to the same Nordic country.

The Tyee's repeated attempts last week to secure an interview with the premier about what he'd learned in his whirlwind four-country tour (and how those insights would inform the big push for health care "reform" announced in the recent throne speech) were unsuccessful. At the end of the week, Campbell's media spokesman Mike Morton finally responded to a series of phone and email requests with the apologetic message that Campbell was too busy to answer The Tyee's questions.

We had asked the premier to name three reforms in each country he thought worth further study, and asked if any of them did not involve someone in the private sector making a profit from health care delivery. We'd also asked him if the recent fiscal and administrative meltdown in the United Kingdom system he's singled out as "interesting" had changed his opinion of that system's experiments with public-private partnerships.

We'd also been in touch with Health Minister George Abbott's offices with similar questions. Minister Abbott had one of his aides decline to comment and suggest we get in touch with the premier. The premier was too busy to talk with us.

Hunting critical answers

British Columbians know, of course, that the premier toured Europe in pursuit of answers to some bold questions, laid out in the Throne Speech:

"Does it really matter to patients where or how they obtain their surgical treatment if it is paid for with public funds?" the speech said. "Why are we so afraid to look at mixed health care delivery models, when other states in Europe and around the world have used them to produce better results for patients at a lower cost to taxpayers? Why are we so quick to condemn any consideration of other systems as a slippery slope to an American-style system that none of us wants?"

While they may be rhetorical, these are, nonetheless, good questions. As part of The Tyee's ongoing effort to explore the context of the premier's trip for our readers, we went looking for experts and activists who would speak with us about some of the implications of heath care delivery and reforms in Sweden.

Does it matter "where or how" we get our health care services? And are there lessons to be learned in Scandinavia that apply to our situation here in BC? Well, yes, it turns out, it does matter quite a bit how health care delivery is structured, and at least some of the northern lessons suggested by the folks we consulted are highly unlikely to be part of the premier's final recommendations.

Swedes' second thoughts

First of all, let's deal with the myth of Swedish repentance. It is a favorite narrative of those promoting more free market delivery of health care in Canada. Sweden, the story goes, after a long, misguided experiment with socialism, has seen the light and is rapidly turning its inefficient socialized Medicare system over to the private sector, reaping great benefits for all. Privately owned hospitals. For-profit clinics. Cost reductions and the efficiencies only the market can deliver. A new light was breaking in the European north and Canada should hurry to emulate the Swedish example.

Johan Hertqvist, writing for the right-wing Stockholm think tank Timbro, published such an article in 2002: "The Health Care Revolution in Stockholm." After describing the privatization of a Stockholm hospital and the creation of more room for profit making in the health care delivery system in one Swedish county, Hertqvist rounds off his essay with the claim that there is now, for Swedish health care "No Way Back." Another Heteqvist article trumpets that "The new Swedish model -- consumer-driven, and incorporating positive economic incentives -- is the future of healthcare. Governments neglect it at their peril."

It turns out, however, that there was a way back, and Swedish voters decisively chose it. The right-wing county government that brought in the celebrated turn toward the market in Stockholm County (one of 21 in Sweden) was defeated in the next election, and in January 2006, new national legislation closed the door against any further privatization of public hospitals and sharply limited the room for private enterprise in delivering health care across the country.

The four private hospitals currently up and running in Sweden will be allowed to continue operating, at least until 2011, and some limited room was left for a few private sector operations entirely outside the public system, but the experiment with grafting for profit mechanisms onto the tax payer supported system was clearly rejected by Swedish voters.

The Ministry of Health and Social Affairs announcement of the new legislation makes no bones about it. "The Government's point of reference is that the Swedish health and medical services should continue to be democratically controlled, financed on the basis of solidarity, provided on equal terms and according to need…..otherwise there is a risk that a conflict of interest may arise between the players in the market and the people in need of care."

'Collective responsibility'

This comes as no surprise to Kathleen Connors, the National Chairperson of the Canadian Health Coalition. Connors, a retired RN and lifelong campaigner for Medicare, has spent a lot of time in conversation with health care professionals from Scandinavia, and she sees the Swedish rejection of sweeping market reforms as consistent with what she learned from those conversations.

"The value given to collective responsibility in Sweden and Norway is high. None of the people I talked with complained about high taxes. They see that they derive big benefits from the investment in collective well-being. They may make reforms and modifications, but they'll be within their basic system, without lurching off track. They experimented with privatization and it didn't work."

Connors believes there are important lessons for Canada to learn from countries like Sweden, but she worries that Premier Campbell's bias in favor of free market solutions might keep him from finding them.

"It all depends on the lens the premier uses to view his experience," she told The Tyee. "If we look at what the Scandinavian countries spend on the social determinants of health- environment, women's rights, clean water, secure employment, wellness and peace, where spending far outreaches what Canada now invests, there are lessons for us."

One feature of the Swedish health care system that might be instructive for Canada, and BC, is the way Sweden handles pharmaceuticals. Rather than leave marketing of prescription drugs to private industry, Sweden has established a state monopoly, Apoteket, which conducts all retail sales of drugs across Sweden.

Public money goes farther

There are lessons closer to home, as well, that might help the premier assess the value of adding for-profit layers to BC health care. The Tyee spoke with Dr. Margaret McGregor, a local physician who divides her time between clinical work at the Mid Main Community Health Centre and a research position at the Department of Family Practice at UBC. Dr. McGregor has looked closely at the implications of allowing for-profit operators into a publicly funded health care sector, something that already occurs in BC in long term care homes, where 30 percent of facilities are for-profit.

The results of Dr. McGregor's research are no more encouraging about such experiments than the failed Swedish experiment. She and her co-researchers, writing last March in the Canadian Medical Association Journal, determined that "Not-for-profit facility ownership is associated with higher staffing levels. This finding suggests that public money used to provide care to frail, elderly people purchases significantly fewer direct-care and support staff hours per resident-day in for-profit long-term care facilities than in not-for-profit facilities."

McGregor's research compared for-profit and not-for-profit long-term care facilities in BC that received similar levels of funding from the public purse. The for-profit homes, not surprisingly, given their need to generate a cash flow for share holders, delivered diminished service to their residents for the same investment of public money. (McGregor's paper cites earlier research that links higher staffing levels to better service for patients and better medical outcomes.)

McGregor told The Tyee about more recent research that extends this comparison. This new work, still being prepared for publication, found that patients in for-profit, long term care facilities were more likely than their peers in not-for-profit homes to be hospitalized for three of six diagnostic conditions viewed as indicators of quality of care.

"The publicly funded for-profit homes have fewer nurses and fewer support staff. The data from BC comparing delivery models suggests the for-profit sector doesn't deliver better service," she told The Tyee. "As a clinician, having read the research on for-profit models, I'd say the proponents of privatization are not considering the evidence to date including this BC experience."

'Profit motive upped death rates'

Premier Campbell has expressed enthusiasm for adopting a mixed public-private system model for delivery of health care in BC. Research in the US and Europe, however, support the BC findings cited by McGregor. The data suggests the Swedish voters may have known what they were doing in their recent rejection of privatized hospitals and wide expansion of the for-profit sector in their health care system.

In 2002, researchers at McMasters University did a meta-analysis of studies across the United States capturing the experience of over 38 million American patients. Their finding: being treated in a for-profit hospital significantly increased mortality when compared to treatment in a not-for-profit facility. In 2004, the same research team determined that cost of care was 19 percent higher in for-profit hospitals than in not-for-profit institutions in the US.

"Our previous study showed the profit motive results in increased death rates, and this one shows it also costs public payers more," said Dr. P.J. Devereaux, the study's lead author. "With for-profit care, you end up paying with your money and your life."

Meanwhile, in Europe, the World Health Organization's Health Evidence Network issued a major study in July 2004, asking some related questions in its cumbersome title "What are the equity, efficiency, cost containment and choice implications of private health-care funding in Western Europe?" This densely researched 35 page report, reviewing research from across Europe, would be a logical addition to any primer on the experiences in Sweden and elsewhere in Europe.

The report concludes "Evidence shows that private sources of health care funding are often regressive and present financial barriers to access. They contribute little to efforts to contain costs and may actually encourage cost inflation."

Tom Sandborn is a Vancouver journalist and a regular contributor to The Tyee.  [Tyee]

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