It is March 2030, and a grim-faced Finance Minister rises in the Ontario Legislature to present her first budget.
“Mr. Speaker,” she declares, “this province has hit a wall. Sustaining our health-care system will consume 80 per cent of this year’s provincial spending. As a result, we have no choice but to impose major cuts to education, welfare, public transit and all other programs and services. I am particularly sorry to have to announce that funding for junior kindergarten must be terminated.”
This budget speech will be repeated in provincial capitals across Canada in less than 20 years, unless health ministers meeting today in Halifax agree to start down the path of fundamental change.
But history tells us they almost certainly won’t.
Don Drummond, the former chief economist of TD Bank, is leading a commission to reform government services in Ontario, as the McGuinty administration struggles to rein in a chronic and crippling deficit.
Mr. Drummond recently delivered a paper that showed how seriously rising health-care costs are undermining public finances.
Over the past decade, public health spending has increased annually by 7.6 per cent, even though inflation held steady at around 2 per cent. This year health care will consume 46 per cent of everything the Ontario government spends.
“Things will only get as worse as health care eats up every other public service like an insatiable Pac Man,” Mr. Drummond warned. He estimated that by 2030, using conservative assumptions, funding health care will take up 80 per cent of provincial budgets.
“The system must be reformed,” he concluded. Who could possibly disagree?
Mr. Drummond listed all the things needed to bend the cost curve while improving the mediocre service the current system delivers: changing the way doctors are paid; letting other professionals provide some services that physicians now provide; shifting the focus from acute care to chronic care; identifying and expanding best practices; fighting obesity and other bad habits; reining in skyrocketing prescription costs.
But all of these reforms were identified 20 years ago. The system is sclerotic, entrenched and opposed to change.
One solution might be for provinces to pool resources and align practices to create a truly national health-care system. Liberal Senator Art Eggleton, who is part of a Senate committee preparing a report on health-care reform, believes the federal government should take the lead.
“They have a responsibility to set some goals ... in partnership with the provinces,” he said in an interview.
But the provinces strongly resist federal direction in health care, and Stephen Harper in the past has criticized federal interference in areas of provincial jurisdiction.
A better strategy might involve provinces working with each other, assisted rather than directed by Ottawa. But interprovincial co-operation is also hard to come by.
For 20 years, people who knew what they were talking about warned that federal deficits had to be brought under control. But Ottawa only acted in the 1990s when it became clear the government was about to hit a debt wall.
People who know what they’re talking about tell us that we’re now racing toward a health-care funding wall. But if the past is precedent, politicians won’t act until it’s clear we’re about to hit that wall.
Then we’ll see if they’re able to brake in time.