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Physician Services Cuts in Ontario

Just Politics or Path to Privatization?

If you have followed the debate about Ontario doctors for the past few months, you might think it is all about their income. As recently as last week, Minister Dr. Eric Hoskins reassured the Legislative Assembly that doctors’ service fees have gone up sixty percent  since the Liberals took office a decade ago and that Ontario physicians are amongst the best paid in the country, able to absorb a five percent cut without any negative effects on healthcare delivery. He has also stated that the government is looking to honour its commitments to increase the wages of other healthcare professionals and to increase funding to home care and mental health services.[1] I can only suppose additional funding required by Bill 95 (Improving Mental Health and Addictions Services in Ontario Act) may result in more challenges in the coming years.

The Health Minister has also said the cuts to physicians’ services introduced this year are a direct result of the annual cuts to the province from the federal Conservative government, claiming them to be in the neighbourhood of eight hundred million dollars a year for the next ten years.[2] In spite of accusations that fifty-four million dollars of federal health transfers were directed to non-health programs earlier this year,[3] the Premier has said that the healthcare budget is increasing, with doctors’ fees set to go up by 1.25 percent next year.[4] Allegedly, then, the cuts suffered by physicians today are being used to fund other parts of the healthcare system by taking services out of hospitals and into regional administrators (Local Health Integration Networks (LHINs) and Community Care Access Centres (CCACs)).

But these cuts or changes, depending on whose side you are on, are not new. Back in 2012, the Ontario Medical Association accepted a cut of four percent that saved the province $850,000.00.[5] An additional cut of five percent now may not be so insignificant in that context. In April of 2015, the then president of the Ontario Medical Association (OMA), Dr. Ved Tandan, said: “During negotiations [for a new Physician Services Agreement] we were told to ‘take it or leave it.’ When we rejected this ‘offer’ to cut fees and programs, and made a very reasonable counter-offer [pay freeze], the government imposed something even more severe than what they offered at the table.”[6]

Is it all really about doctors pay?

The short answer is no. However, the changes continue to be rolled out slowly and the full details are known only to a few people in the government. Even the Ontario College of Family Physicians had not received the details of the confidential “Price Report”by February this year and was struggling to answer to its members on the impact of the new changes.[7] Last month, the OMA announced they had just found out about another 1.3 percent cut to fee-for-service doctors starting 1 October, adding up to a total of 6.9 percent in cuts this year.[8] Despite this limitation, it is known the changes include cuts to physician fees (including “clawbacks”) and cuts to new enrolments to Family Health Teams (FHT) and to residency spots, which directly affect the training of new physicians and their first years of practice.[9] In addition, there are claims of hundreds of nursing jobs being cut,[10] as resources are diverted from hospitals to community care, but they have a different mechanism to negotiate their collective agreements.

It is said there are some 800,000 Ontarians without a family doctor and an estimated 140,000 people added to OHIP every year. According to government figures, medical care costs will increase by three percent every year, so if physicians across the province provide medical services past the 1.25 percent hard cap imposed by the government for next year, Ontario doctors will have to foot the bill themselves through a still unknown mechanism referred to as “clawbacks.”[11] Is it legal to tell a contractor she has to work for free because your needs have gone over budget?

Path to Privatization?

A very important aspect of the cuts to physician services is that the fee changes are not flat across the board. The fees for some procedures are being cut by as much as fifty percent and in some cases, like with fertility clinics and addiction clinics, the cuts may put these privately delivered services at risk of shutting down,[12] which has caused the government to step back by deferring some of the cuts.

It may be argued the government is precisely looking for some services to be eliminated entirely, when the alternative is these be delivered at the expense of doctors. This would cause Ontarians to have to find other methods for obtaining those services and possibly even be more open to the idea of privatization in a not too distant future. The problem with that plan is that while some fees are slashed below the point where they make economic sense, they remain “insured services”and cannot be provided by private funding, as per the prohibition in s. 14(1) of the Health Insurance Act and, depending on the service, for contradicting the accessibility condition in the Canada Health Act.

We might see ourselves in a situation similar to that in Chaoulli v Quebec (2005) where the majority of the SCC found no justification for the government prohibition against individuals obtaining private health insurance. This should not, however, be confused with “privatization.”There are several combinations of public/private healthcare funding and not all of them necessarily imply the government getting out of its positive obligation to provide healthcare, if you believe such obligation exists. Beyond the ideological biases that obscure an honest debate, the experience from other countries shows there are alternatives which can help us finance our healthcare by including the private sector, without replacing the existing system.[13]

Doctor Shortages are Real.

A recent private study by the OMA has estimated the income of Ontario physicians will go down by approximately thirty percent by 2017. The estimate considers the current cuts to physician fees, growth in overhead costs, and inflation. The worse part of the problem is that government has the power to act unilaterally and, as independent contractors, doctors can either accept the terms of the relationship or leave the province.

There are many reasons, other than greed, why some people chose to practice medicine or invest in healthcare as a business. Is there a valid reason why we should require them to be any different than any other private endeavours that make our daily lives better with access to various levels of technology, housing, food, and clothing? On average, doctors enter the workforce ten years later than other professionals and with enormous amounts of debt. Doctor shortages are real and, as with the “clawback”changes in Ontario, they are not always beneficial to the remaining practitioners in the system.

Ontario has already seen a massive exodus of doctors in the 90s.[14] Many doctors may chose to leave to the US, where it is estimated there will be a shortage of 90,000 physicians over the next decade[15] and a potential doctor shortage, combined with restrictions for new physicians entering the system, may already be causing the value of established family practices to increase.[16] These are not good indicators and we should not wait until it is too late to start considering our options seriously.

[13] Brian Ferguson, “The Potential of Private Sector Health Care in Canada: Does it Cause Global Warming?”(2007) Background Paper # 5 Canadian Health Care Consensus Group (Westlaw).