Health service charges and customer empowerment

In a rather teasing but ham-fisted attempt to make healthcare user fees respectable, Canadian economics columnist Neil Reynolds evoked the words of Tommy Douglas, certainly the political father of universal public healthcare in Canada. Douglas once advised: “I think that there is value in having every family, and every individual, make some individual contribution . . .  I think it keeps the public aware of the cost and gives people a sense of personal responsibility. Even if we could finance (medicare) without a per capita tax, I personally would advise against it.” Reynolds concluded from this, “Mr. Douglas, the pragmatic socialist, was right. Free medical care lets people remain personally indifferent to costs, discourages thrift and encourages debt. Medicare needs Tommy Douglas memorial user fees.


Click on: http://www.theglobeandmail.com/news/opinions/opinion/tommy-douglas-the-pragmatic-socialist/article1806775/

OK, Douglas didn’t endorse a punitive user fee and didn’t suggest that in appearing to be “free,” health services would be heedlessly abused by patients. Nevertheless, Reynolds was right to raise Douglas’s statement in considering healthcare reform. There is a connection between making an individual contribution (paying something) and individual responsibility. Let’s suggest as well: when you pay even a nominal fee for a service, you may likely experience a heightened concern for its quality.


It's easy to feel abused under a regime of taxation without representation. It’s revolting. There are risks as well, however, in an exchange in which you claim a service for free. 


In Tommy Douglas’s vision, albeit of a less atomized society, the patient is an interested shareholder in a health service he or she owns as a citizen and taxpayer. It seems possible that a shareholder’s sense of empowerment could be enlivened by introducing some form of service charge.


Taxes are high today as well; democratic socialists of the past would be impressed. However, today millions of patients pay no income taxes. And taxpayers generally have no accurate idea what share of their taxes actually goes to public healthcare services. Those jurisdictions that levy a separate healthcare tax only use the separate tax to pay a fraction of the total healthcare budget. This, in practice, may have the unfortunate affect of bolstering the impression that healthcare is affordable—indeed, a bargain.


The financial costs of rising utilization rates for health services are expected to grow almost twice as fast as the cost pressures caused by our aging populations, as noted recently by The Canadian Health Services Research Foundation. Click on: http://www.theglobeandmail.com/news/national/time-to-lead/healthcare/stop-blaming-seniors-for-soaring-health-costs/article1793802/.


User fees to abate these costs have been widely discredited. To make a real difference, they’d end up unfairly discouraging those with lower incomes. Nevertheless, as the area of greatest growth in costs, surely, the direct relationship between the doctor/prescriber and the prospective patient/client is critical to reform. Conceptually, some form of service charge should help prod both parties to act most efficiently and empower the patient to insist on quality service.


If Tommy Douglas’ reformers could stand up to a full-fledged doctor’s strike, surely, we can consider making  changes to the healthcare system we have inherited—and which, like to one he challenged, also claims to be a seamless virtuous whole.