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The Globe and Mail

Minor surgery on doctors fees isn't the cure

The ongoing battle between the Ontario government and its doctors has demonstrated one thing clearly: When it comes to reforming health care, we're a lot better at talking than doing.

The rhetorical flourishes about doctors' pay have been fearsome.

The Ontario Medical Association, the union-that-likes-to-pretend-it's-not-a-union, would have us believe that its members will suffer grievous financial harm, that patient care will be decimated and that physicians will flee Ontario in great numbers if the government imposes a new fee schedule. Provincial leaders, on the other hand, behave as if the key to wrestling Ontario's whopping $16-billion deficit to the ground rests in trimming physician payments.

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To date, Health Minister Deb Matthews is winning this PR war, largely because physician remuneration has increased 75 per cent over the past eight years.

But, as in many areas of health care, we pay too much attention to cost and not enough to value for money.

Under our current system, very few physicians have actual goals and fewer still are accountable for specific outcomes. We pay them to "care," which, more often than not, means to carry out specific acts as they see fit. There are more than 8,000 medical acts codified in the fee schedule, each with a dollar figure attached.

The root of the current dispute is that the Ontario government has cut the price paid for 37 procedures and frozen the rest. The province says these cuts will save $338-million; it aims to keep total physician costs steady at $11-billion, though it's not clear exactly how. The OMA argues the freeze will result in a de facto wage clawback of 16 per cent over four years, once you factor in inflation and new physicians, and that will mean less care.

Both sides are missing the point – they are bickering over Band-Aids while the patient bleeds to death.

The fundamental problem is that the payment system for physicians is broken. It rewards quantity, not quality. It's economically unsound, it doesn't serve patients well and it doesn't serve physicians particularly well either, except those who are procedural specialists.

Right now, Ontario spends $8-billion annually on fee-for-service payments to physicians, $1.9-billon for primary-care group payments and $1-billion on alternate payment plans. It's the wrong mix for delivering care in the 21st century.

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As Don Drummond said in his report, fee-for-service should be no more than 30 per cent of total physician payments, as it is in high-performing systems, not 70 per cent. That's because fee-for-service can work for delivering acute care, but it's a poor way of remunerating chronic care.

The good news is that capitation (payments based on the number of patients cared for rather than the things done to them) is becoming commonplace in primary care. So is teamwork. But the switch to Family Health Teams has been costly so the province is adjusting. The capitation bonus is being cut, which will reduce a family doctor's income by about 8 per cent, but you don't hear a lot of complaining about that change.

Where most of the noise is coming from is specialist groups. Currently, some specialists are paid a salary and an increasing number have alternative payment plans – a blend of salaries for hospital work, stipends for teaching and fee-for-service for clinical work. But there is still way too much fee-for-service, or piecework.

In many of the best health systems in the world, salaried physicians are the norm, not the exception. Just as important, primary and specialty care is integrated.

Let's look at just two examples from south of the border. The Cleveland Clinic has 2,000 physicians on staff who work in 120 specialties and sub-specialty areas. They are all salaried and have individual one-year renewable contracts with clear targets, not open-ended billing numbers for life, as in Ontario.

More interesting is Kaiser Permanente, a big not-for-profit health-care provider. Kaiser has nine million patients, largely in California. It has 15,000 physicians, all of whom work in physician-owned medical groups. All its physicians – primary care and specialists – are salaried, and they get constant feedback on their performance and outcomes, to ensure their practices (and the larger Kaiser system) are getting value for money.

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This is the kind of fundamental reform that is required in Ontario and other provinces, instead of just tinkering with a largely hopeless fee schedule.

It's time for both the OMA and the government to tone down the rhetoric and get back to the negotiating table – but with the intent of committing to fundamental change, not merely a truce in the frustratingly familiar ritual of public bickering and then buying labour peace with more of the same old, same old.

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