Dear Bernie…………..


The current single payer system in Canada presented a solution in a time when farmers, who had little or no money for healthcare, represented the major demographic in the country and a cooperative type model was therefore attractive.

But times have changed……….…………………

Joanna Morrow

Partner – Arizona Benefit Consultants

Dear Bernie Sanders…

Jan 19, 2016

As someone who has experienced both the Canadian single payer healthcare system and our system here in the United States I would like to share my perspective on what I’ve experienced to be the pitfalls of a single payer system. I was born and raised in Canada and worked for a major health insurer in that country for years.  In 2008 I moved to the United States and since that time have worked as a group health insurance broker assisting employers with cost management related to employer-sponsored medical plans.

“An ounce of prevention is worth a pound of cure.” – Benjamin Franklin

Where the Canadian system falls short is on the diagnostic end of health management. Because the Canadian system is funded almost entirely by Federal dollars and offers universal access to all citizens, providers are stingy with services particularly diagnostic services that would offer a proactive approach to health management and disease prevention.  Allocation of healthcare dollars are shared with each province by the Federal government and are a function of a complicated formulary based on criteria such as population, demographics, etc.  Standard of Care guidelines help provide a medical framework within which providers make financial decisions.  In an effort to make dollars go the furthest and because hospital inpatient expenses are still the largest expenditure in any healthcare budget, the diagnostic and treatment services are prioritized by providers beginning with “best risk” in terms of greatest return on investment.

The notorious waits that we hear of as being characteristic of the Canadian healthcare system are typically for services such as MRIs, colonoscopies, mammograms, or simply the opportunity to see a specialist. The Canadian system operates like an HMO in that you cannot walk in off the street and see a specialist – the family doctor is the gatekeeper who ultimately directs care.  There is no money for frivolous items like gastric bypass (weight reduction surgery) unless under extreme and unique circumstances.   However, once you are diagnosed and treatment protocol identified whether it be a need for chemotherapy, colectomy, etc. then the treatment itself is comparable to what one would receive in the United States minus the frills.  For example, chemotherapy treatment at a Cancer Treatment Centers of America facility might take place in a polished, private room with spa music playing in the background, whereas in a Canadian hospital you will be in a large room in the comfort of a recliner chair along with 20 other patients in recliners also receiving chemo at the same time.  Employer sponsored benefits in the Canadian system offer a “bells & whistles” package to that which is provided for under the provincial healthcare system and that is who pays for private rooms and similar niceties to improve the overall experience.

Careful What You Wish For

There is a lot of discussion around the term “single payer system” as though that is the utopia and the answer to all healthcare woes. I am here to tell you it is not.  The problem in both systems is the COST of healthcare.  In Canada there is never enough money to cover the true cost of proactive, quality healthcare but you listen to Canadians and they love their “free” healthcare all the while complaining of its flaws for which there are many.  The current single payer system in Canada presented a solution in a time when farmers, who had little or no money for healthcare, represented the major demographic in the country and a cooperative type model was therefore attractive.   But times have changed.  There are a growing number of Canadians who are demanding the right to pay for a private and/or superior level of healthcare over what they have currently.

The Root of All Evil

The American system is financed by multiple payers – private insurers, (made up of employers and individual policy holders), patients, and government programs such as Medicare and Medicaid. Here is the United States our problem is also cost.  However, unlike the Canadian system where the Federal government is in the driver’s seat, in the United States the providers are still dictating the cost of healthcare.  I have a claim sitting on my desk right now where an employee of one of my commercial clients received 8 stitches this summer by a plastic surgeon in New York.  He received a bill for $12,000.00.  That is $1,500 per stitch!  The insurance company reimbursed with the usual and customary reimbursement of $2,000.00.  The plastic surgeon then sent a letter to my client advising him to go back to his insurance company and complain that he was being charged the full amount and went on to say “it’s our experience when you do that, the insurance company will pay us more.”  And therein lies the problem.  Providers in the American system are being over-financed in the majority of cases because no one with any significant influence or authority has taken the time to unravel and reform medical billing practices.  Instead we have spent the last few years reshuffling the cards only to redefine who pays the bills.  We all know that the true cost of 8 stitches is nowhere near $12,000.00 and that 3 nights in hospital should not cost $50,000.  How refreshing and original it would be if a politician decided to introduce this as a campaign platform.

When a Federal government finances healthcare delivery in a single payer system there are only so many dollars to go around. As a result it ultimately influences decisions by providers that impact the overall care of the patient.  Medical decisions all of a sudden become in part, financial decisions.  If the Affordable Care Act had redirected even half of the financial and administrative burden it’s placed on employers and instead mandated greater accountability on healthcare providers for transparency in cost of care and billing practices, we may actually start toward addressing the true problem in healthcare.