Here is the Reading List to focus on in terms of PRIORITIES for test2:
I. Lessons 10-20.
II. Review the following articles within the lessons:
1. Direct to consumer advertising of prescription medicines and http:/www.whp-apsf.ca/en/documents/dtca.html.
2. Evans , R. G., (2010). The TSX gives a short course in health economics: its the price stupid! Healthcare Policy, 6(2), 13-23.
3. Fojo, T., Grady, C., (2009) How much is Life worth, J. of the National Cancer Institute, 101(15), 1044-1048.
4. Menon, D. (2001) Pharmaceutical cost control in Canada, does it work? Health Affairs, 20, 92-103.
5. Morgan, S. G. et.al. (2005) "Breakthrough" drugs and growth in expenditure on prescription drugd in Canada, BMJ, 331, 815-816.
6. Drummond A.J. (2002), No room at the inn: overcrowding in Ontario's emergency departments, CJEM, 4, 91-97.
III Text Chapters: 2nd edition, Chapters 4, 10, 11, 15, 16.
Lesson 10
10.1 Introduction
The goal of this module is to explore the recent introduction of regionalization in health care planning and management in Canadian provinces.
We will begin by considering the rationales for regionalization, what regionalization of health care planning and management entails, how different provinces have proceeded
with the process of regionalization, and the challenges they have faced. We will also consider a couple of cases in which regionalization has been reversed.
10.2 Objectives
On completion of this module you should be able to:
o
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State the rationales for regionalization in health care planning and management.
Explain what regionalization of health care planning and management entails.
Describe how different provinces have proceeded with the process of regionalization.
Explain the challenges and trade-offs inherent in regionalization.
o
o
o
o
o
o
o
o
o
o
o
o
o
o
o
10.3 Regionalization
In the late 1980s and early 1990s, most provinces assigned commissions to study the health care system in their province, and released reports with recommendations
as to how to reform them. All of these provincial reports called for the devolution of authority over health care from the provincial level to a regional level.
As a result, all provinces (except Ontario) introduced formal regional governance structures in the 1990s. Québec introduced an early form of regionalization in the late
1970s, and modified the breadth and basis of its regionalization in the 1990s. Ontario was the last province to regionalize, in 2005, with the creation of Local Health
Integration Networks. Since 2005, one province (PEI) has abolished its regional health authorities, and another (Alberta) has abolished all its regional authorities in
favour of one large health authority for the entire province. Let’s come back to explore these distinctions and developments further as we proceed.
10.4 Definition: regionalization
Before we consider a definition of regionalization, we first have to understand how provincial health care planning and management occurs. In each province, health
care planning and management were traditionally undertaken by the provincial government, through the ministry or department of Health.
The ministry of health made decisions concerning the number and distribution of hospitals (general community hospitals, teaching hospitals, specialized hospitals), the
types of services they would provide, the service agencies the government would fund to provide community health services (community health centres, geriatric care
centres, mental health agencies), the number and distribution of public health units, and home care service agencies, and so on.
Regionalization occurs when a provincial government divides the province into a number of regions, and assigns an independentRegional Health Authority to each
region which is responsible for making decisions in planning health services for the region.
10.5 Decisions
To regionalize is thus to change how health care policy decisions are made
and who makes them.
The decisions could include the following:
How health care services & programs are organized, including:
o hospitals
o community health centres
o long-term care homes
o home care
o
o
o
How services are paid for
Which services are provided
The provincial government thus transfers a budget to the Regional Health
Authority (RHA) to cover the costs of health services for the population in
that region. The health authority is responsible for distributing funds to
the appropriate health service providers, and has some flexibility as to
which health service providers it will choose to fund, and on what basis it
will do so.
10.6 Regional Health Authority structure and role
Like most corporations, each Regional Health Authority has a board of directors or trustees which is appointed (by the Minister of Health, for example). Some provinces tried
elections for the regional health authority board members, but these efforts were abandoned when there weren't many people interested in running.
Members of the board of directors steer the direction of health service planning and management by the health authority. There are 2 basic forms of regional health authority in
Canada:
1. the regional health authority takes over the management and operation of health care institutions in a region (ie, it 'delivers care'), replacing the boards of directors
and management of numerous health care institutions (such as hospitals and long term care homes) in a region.
o
A sub-type emerged in Alberta in 2008. There, the province consolidated all the regions into one, adding in the Alberta Cancer Board and others. Thus, a
single health authority now delivers most of publicly-funded health care in Alberta.
2. the regional health authority takes over the funding of health care institutions in a region (ie, it pays for but does not 'deliver care'), and does not replace the boards of
directors or management of health care institutions in a region.
Whichever approach is taken in a province, the key feature of Regional Health Authorities is that they are designed to act as financial intermediaries between the provincial
government and the health care providers.
The provinces have devised their Regional Health Authorities in different ways, to cover different population sizes, and varying types of services. Further, the configuration of
regional health authorities can and does change over time within provinces.
10.7 Decentralization and centralization
Regionalization involves both decentralization and centralization.
At the provincial level regionalization involves:
o Decentralizing the authority of the provincial Ministry of Health to the Regional Health Authorities
At the regional level however, regionalization involves:
o Centralizing the authority of several hospital boards to the Regional Health Authority. Individual hospital boards may either be dissolved or amalgamated. Alternatively
they may remain in place but be superceded by a regional super-board of governors that oversees the activities of the individual hospital boards. Regionalization thus
often involves some loss of autonomy for hospitals, as they are asked to place the needs of the region ahead of its own institutional aspirations, and either make cuts in
areas found to be redundant in a region or add services where gaps exist.
o Centralizing service coordination and delivery. An RHA is in a position to assess the manner in which service agencies coordinate services among themselves. It may
request some agencies to integrate their services by amalgamating their management structures. Alternatively, it may request other agencies to coordinate their
services through formal referral and service agreements, so that services become more centralized.
o
o
o
o
o
o
o
o
o
o
10.8 Devolution of accountability
As it relates to centralization / decentralization, regionalization involves the devolution of accountability (Lomas et al. 1997).
The provincial government devolves part of its control over health policy decision-making (such as health care planning, and resource allocation) to the Regional Health
Authorities. At the same time, the government devolves accountability for policy to the RHA. That is, although RHAs now have the power to develop their own policies,
they are also held accountable if patients do not have access to timely and appropriate health care.
Regional Health Authorities must coordinate the delivery of health care provided through hospital boards, community health agencies, home care services, etc. to
ensure appropriate care. Regional Health Authorities are therefore accountable if health care is not appropriately provided -- accountable to the provincial Ministry of
Health, to health care institutions and providers, to patients/clients, and to the general public.
10.9 Summary of regionalization
Regionalization initiatives therefore involve the creation of intermediary administrative and governance bodies composed usually of appointed officials.
They consolidate, or exert some authority over, existing board and management structures to facilitate coordination & planning at the regional level.
They generally involve the devolution of power from a central governing agency such as the Ministry of Health to regional bodies.
10.10 Rationales for regionalization
In the past, the delivery of health care services was described as being:
o
Fragmented and discontinuous– services were often not well linked in referral from one type of health care provider to another. Medical tests often had to be
repeated, as records were not easily transferred among health care providers and service agencies, and referral agreements among them were often not present.
o Dispersed – health care providers and service agencies were often not placed in the most convenient locations for the majority of the population.
o Inaccessible – there were often long waiting lists for certain types of services which made them inaccessible.
o Unaccountable – if a service agency did not provide appropriate care for a patient then the patient simply “fell through the cracks” and no one was held responsible.
o Wasteful of resources - there was often duplication of some types of services, while gaps in other types of services which led to waste and inefficiency in the health
care system.
This non-system had become unwieldy and expensive, and was widely criticized as being non-responsive to the demonstrated need of the population.
It was also suggested that the inadequacies in our health services system could be improved through better integration of health and social services.
While we will deal with integrated health systems in the next lesson, it is important to note that integration of health services is usually one of the key stated goals for
regionalization, but regionalization is not the only way to achieve integration.
10.11 Economic theory behind regionalization: managed competition
One of the theories behind one form of regionalization is derived from an economic model developed by economist Alain Enthoven (2000) which is referred to as the
“purchaser/provider split” or “managed competition”.
The theory of the purchaser/provider split is that by making health service providers compete for contracts (i.e. funding) they will be forced to provide the best quality of services
at the best price in attempt to outperform their competition and be awarded the service contract.
According to this theory, regionalization creates a new set of financial incentives for service agencies to provide better quality services, at the best possible price.
Regional Health Authorities (RHAs) are expected to allocate resources better than a provincial Ministry of Health because RHAs are not expected to fund institutions as such, but
to fund activities or groups of activities, and where health care providers and service agencies are forced to bid for their business in the form of contracts with finite terms.
The budgets of RHAs are expected to cover acute care services traditionally provided in hospitals, long-term institutional care, certain types of community care (home care,
mental health care, care for the elderly) and certain types of health promotion activities.
If a regional health authority represents the “purchaser” for the population in a region, it can in theory request service providers to compete for contracts. However, in the
Canadian health system, this model has its limits. It would be extremely difficult for a regional health authority to cease buying services from one hospital and to start buying the
services from a new provider – think of the political fallout from what would be in effect the closing of a hospital and the financial cost of having a new hospital start up to
compete.
While Regional Health Authorities do not generally make providers compete for the right to provide services, there is some opportunity for competition when new funding, eg, in
the Aging at Home Strategy funding for services for seniors, becomes available.
How does this economic model get played out, then, when there is no widespread ability to change providers? The usual way is through ‘performance contacts’ or ‘accountability
agreements’, as they are known in Ontario. A contract is drawn up in which the funder agrees to pay for services and the health services provider agrees to provide certain
services.
An example from Ontario is the Service Accountability Agreement between Humber River Regional Hospital and the Central LHIN (where York University is). Have a quick look at
the agreement but concentrate on “Article 7.0 Performance Improvement Process” on pages 13-14. What is found there is backed up in law by section 25 and section 27 of the
Ontario’s law called the Commitment to the Future of Medicare Act. Section 25 allows a LHIN to make a “compliance directive” to a provider (eg, a hospital), and if necessary, then
to make an “order” (under section 27) requiring the provider comply with the compliance directive.
10.12 Exercise #1
1. Describe in your own words the process for getting a health service provider (eg, a hospital) back on track delivering the care that a LHIN wants it to deliver, when there has
been non-performance or under-performance. This involves Article 7.0 of the standard Service Accountability Agreement (available on web) and sections 25 and 27 of
the Commitment to the Future of Medicare Act.
2. How is this process different from the situation in which there could be competition to be the provider of health services?
10.13 Expectations of Regional Health Authorites
According to section 5 of Ontario's Local Health System Integration Act, Local Health Integration Networks are expected to:
... fund and integrate the local health system to achieve the purpose of this Act, including,
(a) to promote the integration of the local health system to provide appropriate, co-ordinated, effective and efficient health services;
(b) to identify and plan for the health service needs of the local health system in accordance with provincial plans and priorities and to make recommendations to the Minister
about that system, including capital funding needs for it;
(c) to engage the community of persons and entities involved with the local health system in planning and setting priorities for that system, including establishing formal channels
for community input and consultation;
(d) to ensure that there are appropriate processes within the local health system to respond to concerns that people raise about the services that they receive;
(e) to evaluate, monitor and report on and be accountable to the Minister for the performance of the local health system and its health services, including access to services and
the utilization, co-ordination, integration and cost-effectiveness of services;
(f) to participate and co-operate in the development by the Minister of the provincial strategic plan and in the development and implementation of provincial planning, system
management and provincial health care priorities, programs and services;
(g) to develop strategies and to co-operate with health service providers, including academic health science centres, other local health integration networks, providers of
provincial services and others to improve the integration of the provincial and local health systems and the co-ordination of health services;
(H) to undertake and participate in joint strategies with other local health integration networks to improve patient care and access to high quality health services and to enhance
continuity of health care across local health systems and across the province;
(i) to disseminate information on best practices and to promote knowledge transfer among local health integration networks and health service providers;
(j) to bring economic efficiencies to the delivery of health services and to make the health system more sustainable;
(k) to allocate and provide funding to health service providers, in accordance with provincial priorities, so that they can provide health services and equipment;
(l) to enter into agreements to establish performance standards and to ensure the achievement of performance standards by health service providers that receive funding from
the network;
(m) to ensure the effective and efficient management of the human, material and financial resources of the network and to account to the Minister for the use of the resources;
and
(N) to carry out the other objects that the Minister specifies by regulation made under this Act.
Regional Health Authorities are thus accountable for the design and provision of health services to their regional population.
10.14 Exercise #2
In section 10.13, we saw that Local Health Integration Networks in Ontario, like regional health authorities in other provinces, have many goals. Two of those are:
o
o
to identify and plan for the health service needs of the local health system and,
bring economic efficiencies to the delivery of health services and to make the health system more sustainable.
1. Identify how these goals might conflict, and provide an example to illustrate your point (the example can be a hypothetical one, but it should involve services or
circumstances that a Local Health Integration Network might encounter).
2. How do you think a LHIN would resolve the conflict? Why do you think this?
10.15 Exercise #3
In Ontario's Local Health System Integration Act, section 5 states that the regional health authorities (Local Health Integration Networks, or "LHINs") are to work to ensure that
there are “appropriate, co-ordinated, effective and efficient health services" in their region.
1. How can Regional Health Authorities ensure there are appropriate and effective health services across their region? Answer this question with respect to any one of
the following:
emergency care, obstetrical care, home care, hip fracture care.
2.
What assumptions about appropriateness and effectiveness are you making? Think about who would define what is “appropriate” and what is “effective”. You may
want to tie your discussion about the assumptions to earlier lessons, including Lesson 2 on Paradigms. Which assumptions do you think a regional health authority
would make? Why?
10.16 More expectations of regional health authorities
Regional Health Authorities are also expected to:
o Be more responsive to local needs than a central Ministry of Health.
By being based within a region, the RHA is expected to have a better understanding of the attributes and needs of the local population. These include modifying the
nature of the services provided according to the demographics of the population. For example, in downtown Toronto, there is likely a greater need for services for
persons with HIV/AIDS. Alternatively, in the suburbs of Toronto there is likely a greater need for childrens’ and family services. In older parts of the city such as the
former East York, there will likely be a greater need for services for the elderly geriatric population such as home care and palliative care.
o Allow systems planning at a regional level
Within a particular region, an RHA may consider the basket of services provided within it, and adjust and modify according to the needs of the population. It can also
request service agencies and hospitals to set up better systems of coordination for referral and emergency care planning.
o Ensure better coordination
An RHA is in a better position to assess patient movement within sub-sectors of the health care system, such as for home care, diabetes care, or mental health care. It can in turn
set up formal service agreements among agencies to ensure that they facilitate the acceptance and movement of clients through the system in a fluid manner to improve
continuity of care within and across sub-sectors of the health care system.
o Realize economies of scale/efficiencies
An RHA is in a position to review and eliminate redundancies in services, by choosing to fund a more limited range of health service providers of one type of service, or request
that hospitals focus on select specialties for the services they provide rather than being all things to all people. For example, Sunnybrook Hospital may asked to specialize in
emergency and critical care and eliminate obstetrical care, while North York General Hospital may be asked to specialize in obstetrical and neonatal care and eliminate its critical
care.
Economies of scale may also be achieved by pooling service contracts within a region for such services as: laboratory analysis, laundry and meals.
o Provide an avenue for citizen participation in decision-making
RHAs are expected to be closer to the population they serve, and to provide an opportunity to for citizens to be members of their board of governors and to participate in health
policy decision-making for their region.
10.17 Trends in regionalization
There are several trends occurring in the health care sector, in which Regional Health Authorities are involved.
1. Cost containment in the institutional sector
There is a shift in emphasis from institutional to community settings (including at home) for service delivery, as institutional care is generally more expensive than
providing care in community settings. Regional Health Authorities therefore assess alternatives to in-patient care for tests and surgery that could be performed on an
outpatient basis, as well as for such programs as dialysis, child birth (midwives and birthing centres), care for children with diabetes, geriatric day programs, etc.
2.
Regional authorities are expected to move resources from one program to another without confronting traditional professional & organizational barriers
As discussed earlier, organizations may be unwilling to scale down programs they offer, or accept patients from other programs due to staff shortages or physical space
limitations. As Regional Health Authorities are mandated to design service delivery according to the needs of the population, they may withhold funds from an
organization if they do not wish to cooperate. With these incentives, most organizations choose to cooperate in moving programs and resources as needed.
3.
Evaluate outcomes produced by health services
Not all health services have been evaluated in terms of being proven to be effective. Many services evolve out of a belief that they are effective, but may not have been
tested. One of the mandates of Regional Health Authorities is to evaluate the effectiveness of health services, to ensure that only those services that are effective are
being funded.
4.
Devolution to Regional Health Authorities will lead to downsizing of provincial ministries of health
It is expected that as Regional Health Authorities subsume many of the responsibilities of their provincial Ministry of Health, fewer administrative staff will be required
by its Ministry of Health, who may potentially require fewer departments as well
10.18 Regional Health Authorities across Canada
British Columbia - 5 RHAs plus one for province-wide services
Alberta - 1 RHA (since 2008)
Saskatchewan - 12 RHAs
Manitoba - 11 RHAs
Ontario - 14 LHINs
Quebec - 18 Regions
Nova Scotia - 9 District Health Authorities
New Brunswick - 2 RHAs (formerly, 8)
Prince Edward Island - formerly, 5 RHAs; then abolished; now a single regional
health authority has been proposed
Newfoundland - 4 RHAs
Types of Regional structures
Saskatchewan: These were subsumed into 12 Regional Health Authorities:
o 127 hospital boards
o 133 nursing home boards
o 45 home care boards
o 108 ambulance boards
British Columbia, Alberta, Quebec, Nova Scotia:
o Have undergone similar consolidation to facilitate coordination & planning at regional level.
o Alberta's RHAs were consolidated into a single health authority (Alberta Health Services Board) in 2008
Quebec:
o Regional health structures were legislated to include an elected Regional Assembly & Regional Health and Social Services Board.
New Brunswick, Newfoundland:
o Have instituted regional arrangements for hospital care and community care
Ontario:
o 14 LHINs fund hospitals, long term care homes, home care (through a single Community Care Access Centre per LHIN), and community health centres in their region.
New Brunswick:
o In the first wave of regionalization, 51 hospital boards were dissolved and replaced by 8 regional health authorities in 7 regions. In 2008, the 8 were consolidated into 2
RHAs, known as Regional Health Authority A and Regional Health Authority B.
Most provinces initially developed large numbers of regional planning bodies. Most provinces have subsequently reduced the numbers of Regional Health Authorities in their
province, for each to cover a larger proportion of the population.
Challenges that urban based regional authorities have experienced is that patients from rural regions often travel to urban regions for specialty care, such as for cancer care. The
urban regions thus end up paying for patients from the urban regions, and may end up with expenditures beyond their budgets.
The antidote to such a pattern would be to either have the rural region transfer a portion of its funds to the urban region, or for the urban region to be allocated a greater portion
of the funds with the understanding that it provides tertiary or quaternary care for the province (e.g. Hospital for Sick Children).
Despite the number of years that provinces have experimented with regionalization, it has recently been recognized that specialty secondary, tertiary and quaternary care (such a
transplants) may need to be centralized on a provincial basis rather than being regionalized. In British Columbia, for example, there is a Provincial Health Services Authority, which
organizes and provides cancer, cardiac, mental health and addictions and specialized women's and children's health services.
10.19 Exercise #4
In Ontario, the government has implemented Local Health Integration Networks, while leaving health care institutions intact -- for example, not-for-profit hospital corporations
are still governed by their own boards of directors. This is unlike most other provinces which have instituted the other form of regionalization).
This form of regionalization has resulted in some considerable friction between the LHINs and individual health care provider boards.
What are the possible reasons that Ontario implemented this form of regionalization, with the regional health authority co-existing with separate and independent health care
provider boards? Consider the obstacles to regionalization discussed earlier, particularly in the Ontario context.
10.20 Conclusion
The rationales behind instituting Regional Health Authorities include improving service delivery and making planning more responsive to the needs of the population. However, as
the varied experience across Canada has shown, there is no consensus on the goals for regionalization or the way that regionalization should be implemented. In fact, some of the
goals are contradictory. Furthermore, implementing new structures may not in itself solve health system problems.
Thus, depending only on regionalization to deal with dissatisfaction with certain aspects of health system performance is likely to fail. To address the areas with which the public
or patients or the government or the providers are dissatisfied may require additional or different strategies. Indeed, each of these stakeholder groups – the public, patients, the
government, the providers – may have (and likely do have) different goals for the health system. Different strategies may be necessary to handle the most prominent of these
different stakeholders’ goals. Recognizing which goals are most prominent at any given time requires such things as political acuity, sensitivity to patient needs, and an
appreciation of the economic climate.
Lesson 11
11.1 Introduction
As health care costs continue to rise and health care needs change, governments, health planners and providers are examining means to go beyond the now familiar belttightening exercises within programs and institutions and look toward means of achieving greater efficiency and effectiveness across programs (horizontal integration) and
organizations (vertical integration). There is a growing belief that this can only be achieved by breaking down existing "silos" and better integrating the various parts of the health
care system. Some advocates also talk of incorporating at least some of the social determinants of health in a coordinated health care system.
This module examines some of the forces driving the process towards "integration" in Canada, the ways in which "integration" is being approached, and outlines some recent
developments in Canada that are linked to the idea of "integrated health systems".
11.2 Objectives
Upon completion of this module, you should be able to:
1. Outline the features of Canada's health care system from an integrated and sustainable delivery system perspective
2. Outline some features of initiatives to integrate health systems in the United States and in the United Kingdom
3. Identify opportunities for and barriers to the integration of health systems in Canada
11.3 What is an “integrated health system”?
There are many terms used to describe concepts of “integrated health systems”. For example, researchers in the United States in the early 1990s described "organized delivery
systems" (Shortell et al, 1993, 1994).
In 1996, Canadian researchers proposed a "Canadian Integrated Delivery System" (CIDS) model (Leatt, Pink and Naylor, 1996). In Ontario the “integration” trend has been picked
up as part of the name of regional health authorities – the Local Health IntegrationNetworks.
Shortell et al (1993, 1996) defined the concept of "organized delivery systems" in this way:
“networks of organizations that provide or arrange a coordinated continuum of services to a defined population and who are willing to be held clinically and fiscally accountable
for the outcomes and the health status of the population being served.”
The goals for movements towards "integrated" care seem, at least on the surface, to be similar. The commonly-identified goals of integrated health systems include the following:
1. More responsive to the needs of patients/residents/citizens, with emphasis on:
o high quality care being provided on a timely basis,
o a variety of choices of care and providers available, and
o readily-available information on which to base those choices
2. Care that is better coordinated ("seamless care" without gaps between services), care that is based on evidence, and care that is provided to keep people well rather than
"cure" people when they get sick.
3. Care organized in a way that manages costs by reducing waste and duplication and provides incentives to achieve the goals in #1 and #2.
(Leatt, Pink and Guerriere, 2000)
11.4 Types of integration
Some researchers have identified that people who say they are integrating a health system can be doing at one or more levels. Shortell et al (2000) identified these levels of
integration:
Policy level integration – At this level, there is integration or coordination of policy and regulation in the health sphere. An example: payments for primary health care
are coordinated with payment for health promotion activities so that one reinforces the other. Another example: when physicians are regulated in the same fashion as physician
assistants or even by the same regulatory body, there is integration of regulation.
Organization level integration – This is integration between organizations or institutions in one or more areas of health care (either the main delivery of health services
or in supporting activities). An example: home care coordinators employed by aCommunity Care Access Centre actually work inside a hospital (another organization) to ensure a
smooth transition between acute care in the hospital and home care. Another example: one health care organization provides financial accounting services for another health
care organization – this is integration of a “function”.
Professional level integration – When two or more professions coordinate their care activities for patients. An example: when a care map or protocol is developed to
lay out the responsibilities of two or more types of health care workers in relation to patients with a specific disease (and the health care workers actually follow the map or
protocol!), you have professional level integration.
Patient level integration – When individual health care workers work together to provide coordinated services to a patient (or a patient group), there is patient level
integration. This is the least formal of the types of integration, and usually develops as the working relationship of two or more health care workers get to know one another in
relation to a specific patient or group or patients.
11.5 Integrated health systems elsewhere
Discussion about the need for improved, integrated health-care services has swept through every province in Canada in the same way that hospital restructuring hit Canada about
15-20 years ago. The two are also similar in that they have been driven by the same force at least in part - a desire to contain costs while improving, or at least maintaining, health
outcomes.
The idea of integration is not new, and has been actively pursued outside Canada over the past 25 years. Three of the more commonly cited models are Great Britain's GP fundholding model (recently reformulated into “primary care trusts”), the managed care system seen in the United States, and the reformed Veterans Health Administration health
system also in the United States. We will review each of these.
11.6 GP fund-holding model in the UK
Under “GP [General Practitioner] fund-holding”, a group of primary care physicians was provided a set amount of money to meet the health needs of a list or “roster” of patients
for which they were exclusively responsible. Investigating tests and pharmaceuticals were added to the fiscal responsibility of the GPs first, and rehabilitative care, elective
surgery, emergency care and tertiary care were added as their experience grew.
In this case, the rostering and the capitation payment (payment per person on the roster) were the responsibility of the GP.
Many changes have taken place in this revolution in health care in the UK since GP fund-holding first started, including the institution of “primary care trusts” centred on GPs as
more robust organizations to support the initiative.
11.7 Managed care in the United States
Managed care, as practised in the United States, was driven largely by corporate concerns and a desire to bring burgeoning health-care costs under control for employers and
insurers. In addition, the government-funded programs, Medicare and Medicaid, embraced aspects of “managed care” to control costs.
Although there are many variations on the theme, managed care tends to work by requiring rostered patients to receive their care through a particular managed care
organization. Typically, the patients’ insurance company or employer would name the managed care organization or provide a list of managed care companies and the patients
could choose one.
The managed care organization employs or contracts with physicians, hospitals and other providers to meet their clients' needs. Managed care has tended to be characterized by
the extensive use of practice care maps or protocols. One of the features of managed care that was most hated by clients (and, as importantly, hated by doctors) was the
requirement for treatment to be “pre-authorized” by an insurance company administrator prior to its delivery. Patients saw it as an opportunity for the managed care
organization to deny coverage and doctors saw it as interference with their practice of medicine. The “pre-authorization” requirement has been modified in most areas to
accommodate greater choice and authority of treating practitioners.
However, you may recall from the recent health care insurance debate in the United States that certain opponents to the Obama administration’s plans (including former vicepresidential candidate Sarah Palin of Alaska) claimed that in a public insurance system, bureaucrats would exercise control over treatment options of patients: in one extreme
example, Ms Palin claimed that “death panels” (that is, groups of bureaucrats) would decide whether children with disabilities would be allowed to live and receive health care.
Others claimed that faceless bureaucrats would decide whether older people would be allowed to receive health care to sustain their lives. While these claims maybe unfounded,
they can be seen to have their origins in the days of managed care in the 1990s.
11.8 The US Veterans Health Administration system
In Canada, our single-payer system for hospital and doctor care means that neither the British nor the U.S. managed care model is completely transferable. A health care system in
the United States that is more analogous to the Canadian system is the Veterans Health Administration health system. (Fooks & Decter, 2005)
This government-funded (and largely government-operated) health system was perceived as unresponsive to the needs of American war veterans, and a new approach to health
care delivery was initiated in the 1990s.
This involved regionalization of the health service with consolidation of health care institutions and the coordination of care between acute care institutions and long-term care
institutions, with the assistance of financial and managerial incentives.
While these reforms were widely praised as successes, they were rooted in a view of the needs of a particular patient population -- older veterans of wars in the middle of the
20th century. While catering to the needs of a defined population is a strength of an “organized delivery system” – Shortell et al (2000) and Leatt et al (2000) both describe this as
an essential feature of an integrated system – the patient population changed as the effects of the 1990-1991 Gulf War were realized - the veterans are younger, and their needs
were different from their older colleagues. No longer is the main problem integrating acute care and long term care/home care; it is focused on rehabilitation and reintegration of
younger veterans into society and on dealing with mental health issues. More recent wars, in Afghanistan and Iraq, have increased the size of the new patient population, and the
VHA system is struggling to adapt. (Bilmes 2007)
11.9 Exercise #1
In what ways would an integrated health system improve the health of Canadians? What kinds of experiences have Canadian patients had with our health care system which
would either support or questions the value of an integrated health care system?
11.10 Integration and coordination
Integration can involve formally linking organizational administrations into a cohesive network, through a single management structure, or linking different organizations through
contracts or less formal mechanisms.
Integration at the regional or organizational level thus involves centralizing, strengthening and rationalizing administrative authority.
Coordination involves facilitating relationships and resource flows (information, services, clients, staff) between independent organizations, to facilitate and strengthen interorganizational linkages. Service coordination is defined as a process of “combining or relating different services across agencies & program lines”.
As agencies must relate to each other to coordinate services, interagency relationships are a core concept.
Horizontal Integration involves consolidating organizations that provide services at the same level
o Goal: Rationalize services & increase efficiency
o Example: Amalgamation of hospitals & creation of multi-site facilities, such as the University Health Network
Vertical Integration involves coordinating a range of services at different levels: acute, ambulatory, long-term, home & primary care.
o
o
Goal: Provide seamless service delivery across continuum of care & one point of entry for patients
Example: Regional
Health
11.11 Exercise #2
Consider the definitions of vertical and horizontal integration in section 11.10.
Authorities
1. Provide one example of horizontal integration or coordination in the health or social services sector (other than the University Health Network).
2. Provide one example of vertical integration within the health or social services sector.
Your answers may be most meaningful if you based them on actual health care organizations that operate in Ontario, that require health and/or social services to be integrated or
coordinated.
It may be beneficial to conduct this exercise from the perspective of a patient who requires cancer care, mental health care, children’s health care, or hip fracture care, etc. In
other words, health care often needs to be coordinated and integrated for a patient in order to ensure ‘continuity of care.’ The organizations from whom a patients requires such
care should be able to facilitate access to the diversity of services he or she requires.
11.12 System models for integrated services
There are two ways health or social services institutions or agencies (or indeed, units within an institution) come together to provide integrated care or services.
1. Voluntary coalitions or ‘voluntary integration’
Organizations/agencies/units voluntarily come together to achieve common objectives, that provide mutual benefit and stability. In Ontario, this is known as 'voluntary
integration', and while usually encouraged, specific instances of this kind of integration can be prohibited by a Local Health Integration Network if the LHIN believes the voluntary
integration is not in the best interest of the entire system or patients.
2. Mandated coalitions or "mandatory or involuntary integration"
Organizations are obliged by government or a Regional Health Authority to interact and achieve common objectives. The texture of the relationship among such organizations
may however be mutually determined. In Ontario, LHINs have the power to force the integration of services provided by different health service institutions if it is in the interest
of the health system and patients to do so.
11.13 Barriers to integration of health systems in Canada
Up until now, Canadians have had a real reluctance to “let go” of their existing health and social services system -- particularly in the absence of a "vision" of what kind of system
will replace it. The Shape of the Future of Health Care report by Roy J. Romonow (February, 2002), captured this difficulty faced by Canadians:
“As Canadians, we feel a strong attachment to a public policy that, for decades, has given us access to a quality health care system on the basis of need rather than income or
wealth. We feel this attachment for some very good reasons.” (p.1)
Without a rational and just vision of what a new system would look like, we have maintained the status quo, and the entrenched powerful interests – such as hospital managers
and doctors – have been reluctant to give up or share their pre-eminent place in the health care system. This means that there has been much emphasis on preserving the way
hospitals and doctors are organized and paid -- the parts that are publicly-funded (Canada Health Act). It also means that other sectors and other potential contributors to the
health of Canadians are typically perceived to be outside the central focus of “health care”.
11.14 Structural barriers to integration in health systems
In other lessons, we have discussed the different components of our health care system, and have discussed how Medicare in Canada has contributed to the predominance of
hospital and doctor care.
But aside from their pre-eminence in public funding, entire government systems have been built up around hospitals and doctors. For example, typical provincial Ministries of
Health had separate divisions for policy and regulation of acute care hospitals, rehabilitation hospitals, specialty hospitals, home care, long term care, etc. This has meant that
there has been little coordination between these sectors at the policy and funding level, and consequently also at the delivery level.
Initiatives to give the total budgets for all these various "silos" of health care to new regional health authorities has opened up the possibilities of different funding arrangements
to solve problems. Because they control the entire "envelope" of money for a region, the health authorities at least in theory can allocate funds to one sector to solve a problem
in another. For example, regional health authorities in Alberta in the early 2000s identified that by mounting significant immunization efforts in their regions, they could help
reduce the demands on hospital emergency departments during flu season.
Similarly, in Ontario, the problem of wait times in emergency departments in hospitals is being addressed not solely by focusing on hospitals and their individual departments.
Instead, the Ministry and LHINs are working to reduce demand by assisting patients to find care in alternative sites, including their family doctors' offices and telehealth.
Also, it has been observed that wait times in emergency departments are sometimes long because hospital inpatient beds (to which some ER patients should be admitted) are full
with patients whose needs could be accommodated either at home or in a long term care home. Consequently, the ER problem is being addressed by enhancing home care and
long term care. Of course, there are also issues of patient flow with emergency departments themselves, and this forms the third prong of the strategy (Ministry of Health and
Long-Term Care, 2009).
While these are examples of cross-silo thinking, there remains tremendous resistance to de-emphasis of the role of hospitals and doctors as central to and predominant in the
health care system.
11.15 Other challenges to integration and coordination
1. Organizational autonomy or “silos”:
When an organization becomes affiliated with a Regional Health Authority it must relinquish partial control over decisions. Organizations will however only enter into
collaborative arrangements if it is in their interest. Sufficient inducements are therefore required in order to alleviate the resistance of individual organizations: a carrot
(usually a financial or other incentive) or a stick (a rule or regulation that they must follow or risk losing their organization’s funding altogether).
2. System complexity:
The sheer number of organizations and agencies involved in the planning and delivery of health services is a major impediment to operating a regional system, as it is
difficult to keep track of and orchestrate them all.
3. Inadequate information systems:
In order to coordinate services, there must be a smooth flow of information among hospitals, community health service agencies, and physicians’ offices. Without such
electronic information systems in place it is difficult to assess and provide services for patients. However, hospitals, and service agencies’ information systems are often not
compatible, and it is therefore difficult to transfer client information among them. Moreover, multiple entry/exit points make it difficult to design processes that can monitor
the movement of clients through the system.
4. Impaired and contrary vision:
Among health service organizations such questions arise as:
Who is to lead? Whose vision takes precedence?
Organizations often have such competing objectives as: improved continuity of care, increased efficiency/financial accountability. However, different objectives imply
contradictory courses of action, and agreement must therefore be achieved among agencies which can pose a challenge, particularly when such competing visions have
budget implications.
5. Funding mechanisms:
A patchwork of funding sources and restrictions on how funding is to be used foster conditions that inhibit organizations and agencies from coming together to deliver integrated
services. Such funding mechanisms can inhibit shifting resources from one program to another.
6. Political context:
The partisan nature of publicly funded health and social services implies each actor (or organization) in the system seeks to secure advantages that promote their agenda.
Reform programs involving regionalization may thus become tools in power struggles over control of scarce resources.
As a result, political bargaining and coalition formation occur. Competing groups may resist working together to create integrated service delivery systems.
In Ontario, for example, it has been found that power struggles have favored institutional over community-based actors (Poland et al., 2005).
11.16 Power, decision-making and accountability
The Romanow report suggested that “New and more collaborative approaches are needed” (p.43) to deal with the challenges to the future of our health system.
One place where collaboration is a challenge is in the governance of integrated health systems. It is important to realize that integrated health systems can either be composed of
one single corporation controlling or owning a range of health care facilities or it can be a network, joined together through mutual agreements and protocols about coordinated
action.
A good and recent example of some of the challenges in governance of integrated health systems is the Niagara Health System's treatment of its Douglas Memorial (DM) site
issue. The DM “site” is one of 7 hospitals that was amalgamated into the Niagara Health System in the 1990s.
The Niagara Health System did a careful study of the pros and cons of keeping the DM site emergency department open, and concluded that, even if it wanted to keep the
department open, there were long-standing availability issues that appeared not to be solvable and that would therefore prevent the proper operation of the department.
Further, because of the reality of the situation, DM’s emergency department had evolved effectively into an urgent care centre, even if it was funded for the more expensive
function of an emergency department. On this analysis, the decision to close the emergency department made sense – from the perspective of an organization "integrating"
services across the region.
However, you will see that in the governance of the overall system, a steering committee representing the local interests in Fort Erie stopped a process that others in the same
organization deemed appropriate. Only the existence of the LHIN and its actions in issuing this integration decision brought about the change in the emergency department.
While reasonable people could disagree on the wisdom of the outcome in this case, the circumstances show that there can be difficulties in reaching decisions to "integrate"
across an organization or across a region. The NHS decision-makers and the LHIN agreed that for the good of the system, one decision had to be made. Local people most affected
by the idea of the closing of the emergency department advocated another decision. Where the power resided – in the regional health authority in this case – the decision was
made.
11.17 Another aspect of governance – who’s in charge?
In many forms of integrated health systems, it is emphasized that decentralized, regionalized and localized management systems are essential, and the local needs should be
determined by the needs of patients/consumers/citizens.
In the example you've just read about – in the Niagara Health System – there was a LHIN board with representatives across the LHIN and not just from the Niagara peninsula and
no one from Fort Erie was involved in the decision-making.
Some might respond that only the people of Fort Erie ought to have been involved, and that centrally appointed Board Members (LHIN boards are appointed by the provincial
cabinet) will always side on the side of the larger system -- perhaps including the needs and values of a segregated and powerful system -- against local needs. Some would also
suggest that these centrally appointed Boards will, given the likely backgrounds of the Board members, be inward looking and represent the interests of those having "silo"
mentality to health care systems -- including some of the medical profession.
Recently, the regional health authorities in Alberta were dissolved and turned them into one big authority for the whole province, with a closer relationship with the provincial
Ministry of Health. While it is sometimes hard to untangle the real reasons for such an enormous structural change, commentators note that some of the regional health
authorities were aligning with their communities and advocating -- publicly -- for more money from the provincial government, and they say that a key motivator appears to have
been that the provincial government didn't like this kind of organized advocacy (Lewis 2008). Others predicted more than 10 years ago this development – a regional authority
consulting closely with its community would eventually come into conflict with the provincial government over significant allocation issues (Lomas, 1997). So we can see that the
governors of an integrated health system might align with powerful central interests, or they might align with local interests.
The Niagara Health System example is interesting because of the relationship between the physicians in Niagara and the management of the NHS. At least some of the medical
staff (including the Chief of Staff) of the NHS were vehemently opposed to the direction the management of the NHS and the LHIN board. Again, we are reminded that sometimes
the governors will align with powerful interests (for example, hospitals and doctors) and sometimes they won't.
11.18 Exercise #3
1. Who should have the major input on the structure, delivery and priority of integrated health systems in Canada?
2. Are Canadians ready or do they want the responsibility of governing their own health system? What information do you have that supports your view?
3. Historically the major decisions with respect to our health care systems have been made by "physicians." Should this medically driven governance model be at the heart of
an evolving integrated health system? Why or why not?
Lesson 12
12.1 Introduction
Last term, we read and talked about policy and management issues, and programs and services that contribute or detract from keeping Canadians healthy. This lesson and the
next lesson continue the discussion. They will examine some of the key questions underlying the sustainability of Canadian health care insurance and delivery system.
12.2 Objectives
Upon completion of this lesson, students should be able to:
1. Outline the development and history of the Canadian health care system
2. Articulate and debate the merit of the 5 principles of the Canada Health Act (1984)
3. Articulate and debate some the effects of changing demographics and the aging of the population will have on demand for health care services
12.3 A few basic principles
Canada has reached a major juncture in the health care road and new thinking is required to ensure that Canadians have timely access to the health care services they need.
Having said that, it should be reiterated that the social arguments for health care are not in question in this lesson. Canadians have continually expressed strong support for the
underlying principles of our system. Poll after poll, process after process, debate after debate, confirms this. The overwhelming majority of Canadians – and all of Canada’s
provincial and territorial governments – agree on a few basic principles:
1.
2.
All Canadians should have reasonable access to high quality, medically necessary hospital and physician care regardless of income or where they reside.
Individuals should not have to choose between bankruptcy and obtaining necessary health care services. With the proliferation of new treatment options and
promising drug therapies falling outside the Canada Health Act, this is a crucially significant issue.
3. Any reforms to the system must not negatively impact the poor or vulnerable.
4. There is an important and ongoing role for government in health care.
This does not mean that all Canadians agree with these principles, and it is important for you to think about why they might not agree.
12.4 Limitations
All future developments in the public health care insurance program have to be shaped by the principles of the Canada Health Act: universality, comprehensiveness, accessibility,
portability and public administration. But today’s reality demands that these principles be subjected to serious review, particularly as they affect and are affected by the changes
in the health care delivery system.
Financial concerns and constraints continue to mount, and the impacts of these concerns are caused and compounded by:
o increasing overall demand
o demands that care become patient-focused and more available, timely and of higher quality
o changing patterns of use
o decreasing mortality
o a growing and aging population, and
o technology costs.
Often in the past, initiatives in health care reform have attempted to manage the cost issues by introducing a series of supply side measures (for example, having fewer hospital
beds but using each remaining bed used more intensively). However, improved efficiency alone cannot meet the demands expected in the future. Alternative options for dealing
with the pressure on the publicly-funded parts of the system – and even the privately-funded parts of the system – needs to be explored. This lesson explores some other viable
options for dealing with the evolving Canadian health care system.
12.5 The need to reflect and reform
As far back as 1979, Tommy Douglas, the "father of Medicare" spoke passionately about the "second phase of Medicare" – the reorganization of the health care delivery system.
He spoke about the need to constantly review the goals of Medicare to make sure that it continued to meet the needs and the desires of the people of Canada.
The final Romanow Royal Commission report entitled Building on values: the future of health care in Canada (Nov. 2002), again captured this need to undertake a serious review
of Canada's health care system. Commissioner Romanow said:
"First and foremost, I am convinced that the Medicare house needs remodeling but not demolishing. Medicare was, and continues to be, the right choice. But the mix
of publicly available health services currently covered under Medicare needs to be adapted to today's medical realities and delivery systems." (p.2)
12.6 Sustainability
Commissioner Romanow's report reminds us that public hospital insurance and medical care insurance were introduced to Canada about 40 years ago when “medically
necessary” health services were provided almost exclusively in hospital or in physicians’ offices. But the health care system in Canada is now a mixture of community-based, home
care, and extended care services, roughly imposed onto a pre-existing system of hospitals and physician services. Today, more money is spent on drugs than on physicians. In
short, the practice of health care has changed dramatically and Medicare structurally has not.
The Canadian health care system constitutes the largest social service sector in the country, and is the third-largest employer in Canada, following manufacturing and trade. Its
immense in size and its reliance upon public funds for support in times of severe fiscal pressures is straining all public systems (education, transportation, security) in Canada.
With Canada facing major international economic problems, a key challenge for Canadian society will be to try and reconcile the various demands for overall sustainability of the
health care system.
Are the pressures on the healthcare system the result of the federal government not paying its fair share, as some provinces have argued? Or are there pressures because
Medicare’s principles are anachronistic and its operating assumptions administratively and economically untenable? Or are the pressures the result of unrealistic public
expectations and anticipated future demand? Or have our overall priorities (education, security, transportation, etc.) changed? Each assumption could require a significantly
different policy response.
12.7 Sustaining Canada's Medicare: let's begin with the Canada Health Act
A brief review of the history of Medicare is critical for understanding the future. Saskatchewan was the first province to establish public, universal hospital insurance, in 1947. In
1957 the federal government offered to share the costs of provincial hospital insurance plans, as long as the plans met minimum eligibility and coverage standards. By 1961 all ten
provinces and two territories had public hospital insurance plans. Saskatchewan, in 1962, was also the first to provide insurance for physicians’ services outside hospitals. In 1968,
the federal government enacted legislation on medical care on a cost shared basis, and, by 1972, all of the provinces had public insurance plans that included doctors’ services.
In 1984 the Canada Health Act was passed by Parliament and replaced previous legislation. It sets out the basic principles which provinces must meet regarding hospital and
doctor services in their health insurance plans in order to qualify for federal funding.
Other health services such as home care and long term care homes (known as "extended health services" in Canada Health Actterminology) may be publicly funded as well by
provincial governments and be eligible for federal funding. However, these services are not subject to the principles of the Canada Health Act except that the insurance plan for
the extended health services must be publicly administered.
12.8 Exercise #1
1. Do you think most Canadians are sufficiently aware of the historical development of the Canadian health care system? Do you think Canadians know that the Canada
Health Act is mostly about paying for health care through public insurance rather than about health care delivery?
12.9 Five sustainability principlesLet's review some of the key principles that have sustained Canada's health care system and which you have been exposed to in previous
lessons.Our health care system allows Canadians, regardless of income, to have access to "medically necessary" health care services provided by doctors or in hospitals.
Canadians may also use a whole range of services, such as eye and dental care, drugs, and long term care, through a combination of public and private insurance plans, and
private payments.
Most people agree that the publicly funded health care system in Canada - often called Medicare - has been one of the best in the world. The key questions that need to be
addressed in this course and lesson are these:
o should we define more explicitly and responsibly what the five principles of the Canada Health Act mean?
o should we redefine the reach of the Canada Health Act?
Medicare has evolved over the last five decades into a unique partnership between the federal, provincial and territorial governments. Today, it is made up of twelve interlocking
health plans administered by the ten provinces and two territories which have authority for the provision of health care. But, this did not happen overnight.
12.10 Exercise #2
The following five CHA sustainability principles underscore many of the values Canadians hold in relation to their health care system.
1. Sustainable public administration: Provincial health insurance plans must be administered on a non profit basis by the province.
2. Sustainable comprehensiveness: Provincial health insurance plans must cover all medically necessary services provided by doctors and services provided in hospitals
(including inpatient dental surgery).
3. Sustainable universality: All residents must be insured.
4. Sustainable portability: People are covered when they are temporarily away from their home province (in Canada) or when moving to another province.
5. Sustainable accessibility: Provincial health insurance plans must provide reasonable access to medically necessary hospital and physician care without direct or indirect
financial barriers.
There are elements in each of these principles that may not resonate with all Canadians. Are there parts that some or most Canadians would not agree with? Please state your
reasons and discuss.
12.11 Canada's 21st century health care sustainability challenges
While Canada's health care system continues to enjoy wide public support, it is under constant pressure to deal with:
o economic, political and structural globalization
o new, expensive and life extending medical technologies and drugs - e.g., hips, hearts, genetics
o public budgets under pressure with competing demands - education, job training, security, military operations
o changing demographics - aging population, low population growth
o changing patterns of illness and life extension
o movement from acute institutional care to community and population health based health models
12.12 Aging, demographics and changing needs in health care needs
It is common to hear that the population of Canada is aging. Of course all Canadians get older, but the “aging population” means that the average age of Canadians is rising, and
there will be a smaller proportion of younger people in Canada and a larger proportion of older people over time. This is due to a number of factors:
o lower fertility (i.e., a lower birth rate)
o lower mortality (i.e., people living longer lives) andlevels of immigration (i.e., how many people from outside Canada are allowed to enter and stay).
It is also common to suggest that because there will be a larger proportion of older people (whose health care needs are known to be greater in generalthan younger people),
health care costs will skyrocket at the same rate that the proportion of older people increases.
However, the experience in Canada has been that although health care costs do rise as the proportion of older people rises, health care costs increase at a slower rate than the
proportion of older people rises. Forty years of experience in Canada tells us that the aging population alone does not increase health care costs as much as we might have
believed – in fact, it has been shown that costs due to the aging population have grown about 1% per year – and can be expected to continue to do so. This kind of cost growth is
sustainable over time through regular growth in the economy. (CHSRF, 2001)
It is important to understand the assumptions that have gone into these projections. The most significant is that the patterns of use of health care will remain more or less
constant over time. If the same sorts of illnesses and disabilities are prevalent as they have been in the past and they are dealt with by the health care system in the same ways,
these cost projections are valid. But are patterns of morbidity (illness and disability) and patterns of use evolving?
The evidence tends to indicate that not only are people living longer, a smaller and smaller proportion of their lives are spent with illness or disability. Yes, older people
are generally sicker and more disabled than younger people, but it appears that older peopletoday are not as ill or disabled as older people in years past, at least to the extent
that they need as many services provided in hospitals (or for such a long time), for example. (Payne et al, 2006).
Why this pattern has evolved probably relates to improvements in overall wealth in Canada, improved education, improved life chances for young people, as well as
improvements in the health behaviours of individuals and improvements in health care efficacy. It probably also relates to the provision and availability of pharmaceuticals and
alternative forms of health care and supports to people, including home care, long term care, and care and support from older people’s adult children.
What does this change in the profile of older people's needs mean in terms of health care use and spending trends in the future? All signs point to a decreasing proportionate
reliance on acute care in hospitals, and a growing proportionate reliance on such services as home care, long term care and pharmaceuticals.
We will return to examine health spending trends in the next lesson.
12.13 Exercise #3
As Canada moves farther into the 21st century, there will be many issues that shape and reshape Canada's health system. What does your group believe are the top 5 political,
economic, social and demographic issues that will affect the health care system? Why do you think this and how will these issues affect the health care system?
Lesson 13
13.1 Introduction
This module is a continuation of some key questions underlying the sustainability of Canadian health care insurance and delivery system.
13.2 Objectives
Upon completion of this module, students should be able to:
o State Canada’s major national and international challenges as a post-industrial nations
o Outline and assess different approaches to save and sustain Canada’s health and health care systems
o
13.3 The cost of health care
o
o
o
o
o
o
o
o
o
o
o
Study after study (Deber, 2000) shows that Canada's publicly-insured health services are fair, cost-efficient, and more effective than any privately-insured health
services. Before public health insurance in Canada, Canada and the United States spent an equivalent amount of money on health care per person. Today, Canada
spends less per person (or “per capita”) than in the United States and gets a whole lot more.
Annual per capita spending, U. S. in 2006, was $6,714 (US) in a health system where 40 million or more people had no health insurance coverage and another 50
million had inadequate coverage. Canada in 2006, however spent about $3,678 (US) per person for a health system (encompassing the publicly-insured and privatelyinsured parts).
Using a slightly different basis for calculating per capita spending, the Canadian Institute for Health Information projected that per capita spending in Canada reached
$5,614 (Cdn) in 2010. (CIHI, 2010). As predicted, the total spending in Canada in 2010 was closed to $191.7 billion (Cdn).
Another common way of comparing spending on health care across countries is to take total spending and express that figure as a percentage of GDP or Gross
Domestic Product (the total value of all goods and services produced in a country in the private and public sectors). Among the OECD countries, United States spent the
most of its total GDP on health care, and Canada was 8th.
It is important to note that some countries who spend less than Canada (such as Japan at 8.2% of GDP) have higher life expectancy and lower infant mortality than
Canada. Similarly, the United States, which spends vastly more on health care, has a lower life expectancy than Canada.
13.4 How Canadians spend on health care
How do Canadians spend their money on health care?
In 2010, as stated, health spending in Canada was projected to be $5,614 per person. Total public and private health care spending in 2010 was projected to be $191.7
billion, up 5.3% over 2009, which, after taking into account inflation and population growth, amounted to growth of 4.0% from 2009 to 2010. Health care spending was
11.7% of Gross Domestic Product in 2010, down from 11.9% in 2009 and up from 10.8% in 2008.(CIHI, 2010)
(2010 $billions)
Total spending
Hospitals
$55.3
Drugs
$31.1
Doctors
$26.3
Other professionals*
$21.3
Other institutions**
$18.8
Public health
$12.2
Capital
$8.1
Other***
$18.6
Total
$191.7
Since 1975, the cost of drugs has increased dramatically while the proportion of direct hospital and community costs either stayed the same or decreased. In 1997,
drug costs overtook spending on physician services - which had been the second-largest category since at least 1975.
13.5 Exercise #1
Examine the table below. Why would higher health care spending not necessarily lead to improved health care services and higher life expectancy and quality of life?
Share one example with your group that demonstrates how quality of health care has been enhanced without increased health care spending.
Table 1
Life expectancy 2006
Country
Population (Million)
Life expectancy (both sexes)
Canada
32.6
81
USA
302.8
78
Cuba
11.3
78
Sweden
9.1
81
India
1,571.7
63
Japan
128.0
83
Australia
20.5
82
Source: World Health Organization 2009.
13.6 Funding health care: truths and mythology
Different industrialized countries (Japan, Scandinavian countries, Australia, Israel, Singapore, Hong Kong) have developed different approaches to funding and delivering health
care. No industrialized country's present health care system is completely private or completely public. On average, however, public financing accounts for about 75 per cent or
more of health spending in industrialized countries.
Public Funding
The federal government reduced the proportion of its contributions to the provinces in the 1990s, and Chart 4 shows the slowing of growth in public spending between 1991 and
1996 that resulted.
Public funding means using tax revenues collected by federal, provincial and municipal governments to pay for health services. The following are a list of basic underlying
assumptions of Canada's publicly funded health care system.
1. Generally speaking, countries with a publicly funded system provide access to health services to everyone (on a universal basis) than countries with mostly
private funding.
2. Publicly funded health systems cost less overall because their administration is less expensive and more effective in keeping costs under control.
3. In Canada, we have been successful in ensuring access to medically necessary hospital and physician services to everyone who needs them. This is what is
called "single tier" health care. Privately-insured services, such as dental services, are another story -- with services skewed toward the rich. (Allin 2008)
4. Some argue that in Canada we have sacrificed access to increase equity, by giving up the ability to pay for services of our choice and we thus have to accept
a lower quality of care, for example, longer waiting lists and limited access to new techniques.
13.7 Exercise #2
What does having a “single tier health care system” mean? Does Canada have a "single tier" health care system? Should Canada continue to have a "single tier" system?
13.8 Private funding for health care
Private funding for health care means using private insurance plans (paid for by individuals or employers) or personal out-of-pocket money to pay for health services either
privately or state operated. The following are some basic assumptions underlying a two-tier health care system proposed by many more market driven-groups in Canada.
1. In systems that rely more on private funding, the poor, the elderly and the disabled are generally affected the most -- they have the least access to private
insurance because of the costs, especially if they are in poor health, which increases the premiums they would have to pay for their insurance. The middle
class is next most affected, and the rich the least.
2. User fees have not been found to be effective ways of raising revenues. They are effective in reducing the use of health services but the people who are
most effectively deterred from using health services are the poorest and the sick -- the people who need the health services the most. (CHSRF, 2001) User
fees also tend to increase overall health care costs.
3. The United States is the industrialized country using the largest number of private insurance plans, capitation programs (HMOs) with widespread user fees.
While the U.S. spends more than any other industrialized country on health, some 40 million Americans have no health insurance, and many others have
inadequate coverage.
2.
3.
13.9 Exercise #3
Is there a two-tier system in Canada? Support your answer with some specifics.
13.10 The situation in Canada
In Canada, Medicare is based on the view that health care is a basic human need (like education and security) and should not be denied to anyone. In survey after survey,
Canadians stress their support for a publicly funded, accessible health care system.
It is becoming clear, though, that as health needs evolve (e.g. sophisticated medical procedures, expensive drugs) and competing cost pressures mount from education, housing,
and employment. Difficult decisions have to be made in gavernment about priorities (institutional, home care, health promotion) and levels of funding.
Currently, most of our health care system – for hospital and doctor services – is publicly funded, although there are some hospital and doctors services people have to pay for
themselves - out of their own pocket, or through private health insurance (camp check ups for kids, cosmetic surgery, private rooms in hospitals etc.).
In Canada private health expenditure includes spending on drugs, dental care, and alternative medicines etc.. In 2010, private expenditures on drugs grew by 4.6% over the
previous year, while public spending on drugs grew 5.2%, on hospitals, 6.2% and physicians, 6.9.%(CIHI 2010). We shall examine the reasons why drug cost increase more than
other sectors in a later lesson.
The following chart shows how the major sectors of the health care system are funded, by public and private money.
(2010 $billions)
Public spending
Private spending
Total spending
Hospitals
$50.4
$4.9
$55.3
Drugs
$12.4
$19.0
$31.1
Doctors
$26.0
$0.3
$26.3
Other professionals*
$1.5
$19.8
$21.3
Other institutions**
$13.3
$5.5
$18.8
Public health
$12.2
$0.0
$12.2
Capital
$6.9
$1.2
$8.1
Other***
$12.6
$6.0
$18.6
Total
$134.7 (70.4%)
$56.7 (29.6%)
$191.7
While the great debate continues about how to "sustain" Canada's health system, the fact remains that we hear periodically in the news about our inability to sustain the health
care system in its present form:
o hospital closings
o limits on drug benefits for the poor and elderly
o de-listing of services and medical treatments
o long waiting lists
o nurses and hospital staff stressed and suffering from complete burnout
o emergency rooms over crowded and closed
o families, primarily women, forced to take over responsibility for providing care to relatives.
While some of these developments (such as hospital bed closures) can be indicators of a change from hospital-based acute care and of improvements in the efficient use of
resources, there may or may not be the complementary increases in the capacity of alternative care settings such as long term care homes and home care. In the chart
above, the long term care home alternative appears in the line “Other institutions”. While spending in this line increased from $9.3 billion in 1998 to $18.3 billion in 2009,
spending on "Other institutions", as a proportion of all health care spending, declined from 11% to 10% over the same period.
13.11 Exercise #4
Some people say that in order to sustain our health care system, there should be even more private pay alternatives available, and some form of "medical savings accounts" and
that private insurance should be allowed to cover these services. Many argue that these ideas, if implemented, pose a real threat to the basic principles of medicare and that it
will end up costing more in the long run as shown by the American system and more recent experiences in the UK.
What are some of the potentially serious threats to preserving medicare if the federal government changed the Canada Health Actto permit the provinces to allow a two-tier
system for hospital and doctor services? What about services other than hospital and doctor services?
13.12 Four schools of thought to improve sustainability
Following extensive travel across Canada and listening to Canadians from all walks of life, Roy Romanow, who headed the Commission on the Future of Medicare, offered the
following four schools of thought on how best to address the challenges confronting Medicare. Each approach has its own compelling rationale and reflects values-based choices
that Canadians will have to face as we further move into the 21st century
o
The first sustainable approach is more public investment. The system has clear needs, and these should be met through the tax system, either by reallocating spending
from other government programs or by raising taxes.
The second sustainable approach is more user-pay. The system needs money, but as taxes are high enough, this money should be raised through user-fees and copayments schemes that have the added benefit of giving individuals an incentive to use the system prudently.
The third sustainable approach is to increase private choice. In order to relieve pressure on the public system, Canadians should be able to access health care services
from a private sector provider (either for-profit or non-profit), and pay for these out-of-pocket or through private insurance.
The final sustainable approach is to reorganize service delivery. The central thesis here is that our health system is fragmented, poorly organized and provides few
incentives to focus on health promotion and prevention. By restructuring how care is provided, we can preserve and enhance the system.
o
o
o
o
o
o
13.13 Exercise #5
Now that you have reviewed the history of the evolution of Canada's health system, some of the challenges, and some possible approaches to improve the
sustainability of Canada's health care system, what is your prediction of its future sustainability
The team leader should compile a list of, and describe, the top 3 negative and positive predictions of the future sustainability of Canada's health care system.
Lesson 14
14.1 Introduction
The goal of this lesson is to explore the involvement of members of the lay public in shaping three different levels of health care decision making involving:
o micro: personal health care decision-making
o meso: health service policy and administrative decision making and
o macro: provincial or regional health policy.
o
o
o
o
o
o
o
o
14.2 Objectives
On completion of this lesson you should be able to:
State the rationales for public involvement in health care decision making.
State and define the different levels of participation possible in the health care context.
Explain the reasons for the limited nature of public involvement in health care decision-making in the past.
Explain the extent to which public involvement is currently occurring at the micro, meso and macro levels.
Describe the social reasons why public involvement is so important.
Describe the challenges to public involvement in health care decision making.
14.3 Public involvement in health care decision making
Public involvement in health care decision making has been fairly limited since before the development of Medicare in Canada. There are a number of reasons for the public’s
limited involvement, including
o the dominance of the medical profession
o the technical sophistication inherent in health care
o the lack of a formal or traditional role for public involvement in health care.
In recent years, however, there have been some shifting paradigms in health care concerning the public’s involvement in the decisions that affect their health care for a
number of reasons.
14.4 Impetus for change
The impetus for change in recent years arises from several sources. The World Health Organization's (WHO) vision of health promotion for example includes such concepts as
"community participation," "community empowerment," and "healthy public policy."
In fact, the WHO’s definition of health as “not only the absence of disease but a state of physical, mental and social well being,” implies a higher level of citizen self-determination
and involvement in their health and in the social institutions that support their health.
Recent provincial government commissions and reports on health care in the late 1980s and 1990s also advocated “increased citizen participation” in health care. In these reports,
community participation was seen as a vehicle to improve population health
14.5 Citizen participation
Society’s perception of health has thus changed in recent years. Medical care is now perceived to involve a social, not just a technical or commercial relationship (Bates 1983).
Health care is social because our health is intricately linked to how we live, the relationships that sustain and support us, and our cultural orientation. In the end, social, personal
and lifestyle considerations play a large role in shaping decisions concerning societal and personal health care, and therefore provide a legitimate role for citizen participation.
Since health professionals have often taken on the role of authority figures, clients are reassessing their relationships with such professionals in an attempt to address the
apparent imbalance that has so long been a systematic part of our health care system.
“Lay participation,” “citizen involvement,” and “citizen participation” are distinguished from participation by traditional health care decision-makers, such as providers,
government officials or managers.
Charles and DeMaio (1992) conceptualized the dimensions of lay involvement in health care decision-making. They described 3 decision-making domains within the health/health
care system where there are possibilities for involvement or engagement by citizens.
Level
Relevant decisions concern:
Treatment level
Treatment choices for an individual or a family member
Service delivery level
Management processes, resource allocation decisions within a health care provider’s operations
Macro or system level
Resource allocation among health programs, health and other areas
14.6 Treatment level decisions
In the Canadian health care literature, patients are sometimes referred to as “consumers”. While the term “consumer” often implies a commercial relationship, consumers are
also considered to have a degree of power, in that they are able to make choices concerning their consumption. If consumers are dissatisfied with the services rendered, they can
“exit” or walk away and attain the desired services elsewhere.
The term “patient” alternatively implies a more passive role that is somewhat dependent on the professionalism and good graces health care providers. From this perspective,
patients are seen as dependent on the paternalism of providers, which implies a lower degree of control in a treatment encounter. The term “consumer” or “client” is therefore
commonly used in place of “patients” in the health care system.
While the use of the terms “consumer”, “client” and “patient” have been debated among health professionals, health policy analysts and health system administrators, what do
people who are getting health and social services want to be called? How do they view their role in the system?
Deber and colleagues (2005) went out and asked them, and reported that most people dislike the market connotations of the term “consumer” and generally prefer the term
“patient”. However, the preference in terminology did not mean that “patients” necessarily wanted to hand over all the treatment decisions to their health care providers. The
preference for “patient” existed even among those “patients” who had the most knowledge about their conditions and who actively engaged in discussions with their health care
providers about the positives and negatives of their treatment options. Most wanted to be involved, taking what their health professionals knew and recommended, and having
substantial influence on what was going to be done.
Robert Evans (1984) emphasized that health care is different from most commercial products or services, as individuals seek out health care not for its intrinsic value, but for the
improvement to their health they anticipate it will bring. This special characteristic of health care therefore makes health care “consumers” at the treatment level somewhat
different than other types of commercial consumers.
14.8 Why increased citizen participation in service delivery and system levels?
Several scholars have discussed citizens’ alienation within industrialized societies. The sociological literature of Karl Marx, Max Weber and Michel Foucault provide examples. Karl
Marx’s writing addressed the inadequacies of capitalist based societies in serving the needs of the working class, and the uprising of working class against capitalist systems. Max
Weber and other scholars who studied early forms of public administration focused on the increasing specialization of work, and the alienation of individuals within it.
The growth of technology and the interdependence of institutions within our society mean that it is often impossible to opt out of government influence and control, given
government’s involvement in developing laws concerning social behaviour, and programs of social support. Michel Foucault’s work focused on the loss of individual control within
institutional settings.
The mass media also illustrate the inequalities in provision of public services, and lead to demands for equitable treatment of the disadvantaged. Media attention has brought
attention to cases of child neglect of infants of homeless mothers, and the inadequacy of the Children’s Aid Society to protect such infants. Discrimination in society by members
of the police and other officials of authority have also brought attention to cases of injustice.
The Canadian Charter of Rights and Freedoms (1984) has also given greater weight to the cause of individual rights. The Charter enshrined an array of rights to groups and
individuals, allowing them to challenge government laws and regulations in the courts, which has led to a rights-based orientation within society.
14.9 Opinion polls
In 2005, the Health Council of Canada produced collected the results of opinion polls from the first five years of the 21st century.
They found that polls in 2002 and 2005 found that the majority of Canadians thought that it was important for citizens to be involved in healthcare system decision-making, and
that decisions about the system would be better if the views of citizens were sought out and taken into account. Perhaps reflecting the public mood at the time, other major
inquiries into the health care system, including the Romanow Commission, argued strenuously for more public participation.
14.10 The potential outcomes of increased participation
There are many reasons advocates promote public participation in decisions at the service delivery and system levels, many of them instrumental.
1. Satisfy consumerist demands
With the rise of the neo-liberal ideology and policies over the past 30 years, with emphasis on market-like mechanisms of control, some people have come to view their
participation in the health care system like their participation in the market for consumer goods where they can decide between brands and level of customer service. With
these developments, they demand a participatory role.
2. Build consensus
The greater the extent of public participation, the greater is the opportunity to build consensus among those participating. Contending arguments can be discussed, and different
perspectives shared.
3. Increase accountability
The greater the extent of public participation, the greater the opportunity to monitor administrative agencies, and initiate government reform in ways that are most responsive to
public needs. Public participation can also make health care providers more accountable to the communities they serve.
4. Change public attitudes, expectations, & political priorities
By sharing different social perspectives, and expressing needs, greater understanding can be achieved among government, providers and the public.
5.Incorporate patient preferences into treatment alternatives
By having consumers involved in the decisions that affect the way health care is delivered, they can exercise greater control so that the treatment options best support their life
style, social and cultural preferences.
6.Provide a way to express and resolve dissatisfaction with health system performance
There are a number of aspects of the health system that have been broadly perceived as underperforming. Part of the rise of these concerns may come from greater consumerist
perspectives (see above) but some also from greater awareness in the public sphere about how the health system works.
Prime among the drivers of these perceptions are the concerns about rising health care costs, and the various alarmist portrayals of health care costs threatening the economy
and other aspects of social life. Other drivers include the following:
Awareness of small area variation in medical practice
This involves different treatment patterns for the same condition across regions of the province, and the country. For example, the rates of mastectomy for breast cancer
compared to lumpectomy plus radiation in Toronto versus Thunder Bay have been found to be very different, with higher rates of mastectomy in rural regions. Publicly-funded
websites about wait times for specific procedures and diagnostic tests also allow for easy comparisons of different levels of performance.
Critical appraisal of health care interventions and a lack of proven efficacy of health care activity
As only 40 percent of health care treatments have been proved to be effective, there are calls for greater evaluation of heath care interventions. For example, hormone
replacement therapy (HRT) was considered an effective treatment for the prevention of post-menopausal symptoms, heart disease and osteoporosis, until clinical trials in 2002
found that HRT increased rates of breast cancer, heart and stroke.The recognition of the importance of non-health care related determinants of health.
With the shift away from the contribution of medical care to health, to a focus on the broader determinants of health in enhancing health status, a role for the public is
increasingly important.
14.11 Levels of citizen participation
The Health Council’s Primer (2006) identified the first categorization of levels of citizen participation as an article by Sherri Arnstein in 1969. There, Arnstein described a “ladder of
participation” and the ladder was illustrated in the Primer in this way.
To simplify the ladder, the Health Council reviewed different concepts of the degrees of participation, and suggested that there are three essential tactics:
o Public communication, Public consultation, Public participation
Public communication was described as generally one-way communication from the government to the public, with no specific goal of obtaining feedback or input directly.
The awareness concept of “spin” has helped these one-way communications become more suspect for hidden or biased or politically-motivated views over time.
In public consultation, there is a one-way flow of information from the government to the public and then an invitation for the public to provide comments, usually “raw”,
to the government. There is no dialogue, or back and forth discussion, for clarification or greater understanding. The interpretation of the raw input is left to the
government.
In public participation, there is a flow of information back and forth between the government and members of the public. Often the dialogue is structured between
representatives of the government (officials or bureaucrats) and groups representing segments of the public. Sometimes, members of the public are invited to engage in the
actual decision-making with some formal voting procedures, for example.
14.12 Challenges to participation
While participation may therefore be a desired goal, several obstacles must be overcome to attain public participation in health care decision- and policy-making.
A belief that the majority of people are not interested in participating
“the flaw in the pluralist heaven is that the heavenly choir sings with a strong upper class accent” (Schattschneider 1975).
This quote from an American political scientist emphasizes the members of the public most likely to participate are those in the middle and upper classes who are educated, have
resources, and are members of social institutions through employment or political affiliation. Those least likely to participate are individuals with low income and education,
as they either have other more pressing concerns (for example, a single mother on social assistance whose main concerns may be how to provide for her children), or are
not aware of, or interested in opportunities to participate.
Attempts to gain a more “representative” group may thus tend to fail because of a lack of time, interest and commitment by a sufficiently high number of individuals from lower
socio-economic groups.
Diffuse versus concentrated interests
Concentrated interests reflect the interests of those who are most directly affected by a change in policy. For example, “Primary Care Reform” which involves a change in how
family practices are organized will likely affect physicians and nurses the most if it changes how they are paid. For patients, access to health care should remain the same or
improve in terms of the hours at which health care is available (such as evenings and weekends). In this case, physicians represent “concentrated interests” while consumers and
the public represent “diffuse interests”, unlikely to mount a serious challenge to “primary care reform.”
Where there are concentrated interests, there are concerns about individuals promoting their own narrow interest. Another way of putting this is that members of the public may
provide a “user perspective” but cannot provide a collective or public policy perspective. Further, it is often argued that individual members of the public can only effectively
articulate the effect of a proposed policy or idea or practice on individuals, whereas in the policy arena, there is usually a concept of a broader community or collective good that
can only be articulated by others, usually representatives of groups of members of the public.
For example, in developing a policy on whether an expensive experimental drug that treats multiple sclerosis should be included on a list of insured drug products for example, a
patient (or family member of a patient) with an illness such as multiple sclerosis is thought likely to advocate for adding the drug to the list of benefits. Alternatively, a participant
with a broader community perspective may wish to understand the level of benefit that will be derived from the drug, the percentage of those with multiple sclerosis who take
the drug are expected to benefit and whether the benefit of an experimental therapy justifies its cost.
If the high-cost drug is listed, the result may be that other programs that benefit other subsets of the population may have to be cancelled, given that budgets are limited. Such
difficult choices may thus be best made in a balanced way that incorporates complementary and competing perspectives.
2. A belief that public participation will not necessarily be a force for change, but may be a mobilization of forces for the right / left or for already-entrenched interest groups
Those who participate may be attempting to influence policy to their advantage by advancing a specific political agenda or the interests they have. In other words, they are not
participating for the sake of the overall public good, but to advance a position for which they are advocating.
3. A belief that administrative agencies use participation for their own ends, to “co-opt” those participating
Government administrators or politicians may wish to advance their agenda, but often need their plans accepted by the groups and individuals most affected by a change, in order
to gain legitimacy.
4. A belief that citizens don’t know enough
Informational asymmetry refers to the higher level of knowledge and information held by health care practitioners as compared to lay persons and consumers. While health care
practitioners therefore serve as patients’ agents in accessing health care, the imbalance in information between provider and patient can create a barrier to participation if
patients feel uneasy about asking questions or asserting their preferences when treatment options are discussed. Such information asymmetry and the dominance of physicians
thus legitimizes decision-making authority in the hands of professionals.
14.13 Exercise #2
1. Besides the patient's perspective and the broad community's perspective, are there other types of potential participants in decision making health/health care systems
at the meso and macro levels?
2. What perspective(s) would they bring to decision making?
Lesson 15
15.1 Introduction
Much of medical care is given in hospitals and spending on hospital care is the largest single item in the health care budget. At the same time the nature of hospital care is
changing. Surgery that in the past would have required an admission to hospital is now done on an outpatient basis; hospital stays are getting shorter; emergency departments
are becoming more crowded.
Besides changes in how patients are treated there are also changes in working conditions inside hospitals. In the early and mid 1990s many nurses were laid off or switched from
full-time to part-time or casual. Now we face a nursing shortage. Changes in hospital care also cause changes elsewhere in the health system. As patients leave hospital earlier
home care becomes more important. Also, as hospitals are closing the remaining hospitals need to operate more efficiently so that care does not suffer. All of these changes may
affect patients’ satisfaction with the care that they receive in hospitals.
15.2 Objectives
By the end of this module you should be able to:
State the factors that need to be considered when looking at waiting times for hospital services.
Identify the reasons for overcrowding in emergency departments.
State why nurses left Ontario and what measures can be instituted to retain nurses in the future.
Outline the possible stresses on family life that come from home care.
Formulate ways to monitor patient satisfaction with hospital care.
15.3 Waiting times for hospital services
There has been considerable debate around the issue of waiting times for things like cataract surgery, knee replacements and MRIscan. However, there is actually very little good
information about waiting times across Canada because the way that waiting times are measured is not standardized. Should the waiting time start when the patient first notices
symptoms, when s/he first sees the doctor, or when the doctor decides that a procedure is necessary? For a number of conditions we also don’t know if longer waits make a
difference to the outcome. For instance, if radiation therapy for cancer is delayed by 3-4 weeks does it really matter?
Check wait times for certain surgery and diagnostic procedures in your area on Ontario's wait times website. (We'll look at emergency room waits later.) Pick a type of surgery or a
diagnostic test in the hospital nearest your home and then see where you could go in Ontario to get the surgery without waiting as long.
15.4 Emergency departments
Return to Ontario's wait times website for information about the time spent in emergency departments in hospitals in or near the Local Health Integration Network area where
you live or are familiar with.
15.5 Exercise #1
When departments are busy, waits can be 4-5 hours or more for minor problems. One way to reduce waiting times might be to hire more staff. However, if the number of
people coming into emergency departments drops then the hospitals will be paying staff who are not doing much work. Come up with three additional solutions for
dealing with overcrowding. Make sure to say why you think each would work and what effect it would have.
Read the article by Drummond. He lists many possible solutions to deal with overcrowding. One of the measures that he identifies is better data about the problem of
overcrowding. What kinds of information should be gathered to help clarify the problem? Make sure you say why the kinds of information would help clarify the
problem.
15.6 The nursing shortage
Between 1991-2001 thousands of nurses left Ontario, mostly to work in the United States. Most of these nurses left because of hospital downsizing and a lack of job
opportunities. One of the major reasons for overcrowding in emergency departments is a lack of trained nurses. Fewer nurses means harder working conditions for the ones who
remain and possibly poorer patient care.
Now skim the highlights of Ontario's Nursing Strategy.
15.7 Exercise #2
Many nursing positions in Ontario are part-time. Nurses argue that part-time positions result in them leaving the province for work elsewhere or leaving the profession entirely.
Hospitals say that with tight budgets they cannot afford to keep all nurses on full-time.
1.Are there other things that hospitals could do besides offering full-time jobs that would lead to the retention of nurses? Be sure to explain how the initiatives that you
identify would lead to nurses staying.
2.Doctors are not subject to lay-offs like nurses are. Doctors also seem able to increase their income while nurses do not have this option. What are some reasons that
doctors and nurses are treated differently? (In thinking about this question, think back to some of the work we did in the first term.)
15.8 Home care
Between 1996 and 2001, more than 275 hospitals across the country were closed, merged, or converted to other types of care facilities. The number of approved beds is also
down substantially. At the same time, many more people are being cared for in hospital day-surgery programs. The shift in the number of hospitals and in the type of care offered
in hospital has led to a dramatic growth in home care.
15.9 Exercise #3
Home care is often delivered by family members, particularly women.
1.Should home care be provided by family members? What sort of stresses, if any, do family members come under if providing such care?
2. If family members provide home care, what resources should be made available to them? Be sure to state why the resources would be helpful or useful.
3. If you were a patient and had the option of staying in hospital or getting home care, which would you choose and why?
15.10 Patient satisfaction with hospital care
As hospital stays are shortening and with substantial other changes in the way hospitals operate and provide care, there is a question of whether or not patients are satisfied with
the care that they recieve. Patient satisfaction or dissatisfaction can affect overall attitudes towards the health care system and can be a force either leading to more changes in
the health care system or can stop politicians from proceeding with other changes.
In Ontario, annual reports on hospital performance are prepared and issued by the Health System Performance Research Network, and one of the indicators of performance is
patient satisfaction.
Next, surf the patient satisfaction part of the 2007 OHA report on hospital patient satisfaction, or 2008 report on acute care hospitals and discover the levels of patient satisfaction
in different kinds of hospitals in Ontario -- community, small and teaching hospital. Also, look for hospitals near where you live or where you are familiar with.
15.11 Exercise #4
1.
What factors do you think influence patient satisfaction with hospital care? Indicate which factors you have identified from what you have read for this lesson, and
which you have identified from personal experience or the experience of others.
2.
After Saskatchewan closed more than 50 small rural hospitals in 1993 it was found that death rates fell faster in communities that lost their small hospitals than in
those that kept them open and yet people in communities that lost hospitals were less satisfied with health care after the closures (Liu, L., Hader, J., Brossart, B., White,
R., & Lewis, S., 2001). How would you explain this paradox? If unable to access the article, please use other resources or hypothesize the reason for this paradox.
3.
4.
5.
15.13 Readings
Drummond, A.J. (2002). No room at the inn: overcrowding in Ontario’s emergency departments. CJEM, 4, 91-97.
Registered
Nurses
Association
of
Ontario
(2003) Survey
of
Casual
and
Part-Time
Registered
Nurses
in
Ontario. Available
http://www.rnao.org/Page.asp?PageID=122&ContentID=1047&SiteNodeID=467
Liu, L., Hader, J., Brossart, B., White, R., & Lewis, S. (2001). Impact of rural hospital closures in Saskatchewan, Canada. Social Science & Medicine, 52, 1793-1804.
at:
16.1 Introduction
The area of mental health represents one of the saddest chapters in the development of the Canadian health care system – and it continues to remain one of its
weakest links. In this session we explore the series of stages through which health care for individuals with serious mental illness has been developed in Canada, and
some recent developments.
16.2 Objectives
On completion of this lesson you should be able to:
1. Understand the history of mental health care in Canada.
2. Explain how mental health care is an area characterized by the ‘broad determinants of health’.
3. Describe the role of institutional care for individuals with serious mental illness.
4. Explain the importance of community care, and how community care is organized in the mental health sector in order to ensure ‘continuity of care.’
16.3 How is mental illness conceptualized?
In the medical model, mental illness is conceptualized as a series of defined illnesses that affect
usually classified based on duration and severity of symptoms, and include:
o Depression
o
o Bi-polar disorder
o
o Schizophrenia
o
one’s well being, and that have common types of symptoms. The illnesses are
Anorexia/Bulemia
Personality disorder
Alzheimer’s
disease
While most of these illnesses have a profound effect on a person, current models of care emphasize recovery and re-integration into one’s normal life.
This was not always the case, however. Simmons’ (1990) and Lajeunesse’s (2002) accounts of mental health care in Canada prior to the turn of the century and the early- and mid20th century provide a description of treatments and therapies for persons diagnosed with mental illness that were not very effective.
16.4 Early treatment of mental illness
Part of the problem with early treatment lied in the lack of understanding by clinicians of mental illness, and the lack of proven treatments that could address mental illness.
Patients were often subject to the treatments below because the health professionals were at a loss to know what was effective.
Some of the early treatments for mental illness included warm or tepid baths (just below body temperature) for 2 to 24 hours, hot or cold body wraps (patients wrapped in a wet
sheet for hours). Shock treatment became a growing trend in the 1940s and 1950s. Various restraints were used to prevent movement for certain patients. Patients were also
placed into solitary confinement in small quarters at times as well.
In one experimental therapy, patients were injected with malaria virus to induce a fever, after which quinine was provided to kill the malaria virus. It was believed that the fever
induced by malaria produced an effect that cured the symptoms of the mental illness (Lajenesse 2002).
The other practice was lobotomy, which was performed on patients in Canada, Britain and the U.S. from the mid-1940s to 1960. After this time it was discontinued (Simmons 1990).
16.5 Institutionalization
As our understanding of mental illness was in its infancy in the 1910s and thereafter, patients were often sent to asylums for long term stay, without much expectation of recovery.
Living in an asylum was however a de-humanizing experience. Patients generally had a bed in a large ward, with little privacy or room for personal effects, work duties such as
cleaning the institution were common, and little diversion was made possible. Patients were treated harshly, with little respect. Such revelations were revealed by a reporter in
Alberta who posed as a person with symptoms of mental illness. It is no surprise that most became more depressed and despondent under these conditions (Lajeunnesse 2002).
Asylums were also located in rural locations, at a distance from a city. This left patients with little contact with their community, and due to the distances that had to be traveled
often made visits with family infrequent. That is, if one’s family continued to care. Mental illness often presented challenges that most families found very difficult to deal with,
often leaving the person affected alone and without hope. Such was the state of care in the early decades of the 20th century.
While accommodation in psychiatric facilities has improved since that time, another problem of residing in an institution is the growing dependence patients develop on having their
needs taken care of for them. In this way, living in an institution can make patients ill equipped to resume their life in the community. This is an effect that continues to the
present day.
Moreover, the diagnosis of mental illness itself was often not accurate, and individuals would at times receive inappropriate treatment due to misdiagnosis, which occurred up until
the 1990s. For example, a person or child with a developmental disability may have been diagnosed with a mental illness, and received the treatment that went along with it.
16.6 Community care
Governments and private agencies had also established a series of disparate services for community mental health care ranging from child guidance clinics, mental health clinics, to
outpatient clinics and wards in general hospitals and other specialized services in the community.
An Ontario government report on community mental health in 1955 painted a gloomy picture, revealing mental health services to be “under funded, maldistributed throughout the
province, administered in a bewildering variety of ways, supported financially by the province and the federal government but avoided like the plague by municipalities and
lacking a clearly defined mission” (Simmons 1990, 51).
The mental health clinics were aimed at early detection and treatment of mental illness. Outpatient clinics and psychiatric units were intended to treat people with mental illness
close to their communities, without having to institutionalize them in the large psychiatric hospitals. Traveling clinics covered wide distances but could only diagnose, and could
not treat illness.
It was only in the 1950s that consideration was given to integrating these services into a community mental health services network.
A 1986/87 Ontario government report on mental health spending reflected the fledgling role of community mental health services, in the table below, comprised of only 4.9 percent
of the mental health budget.
Service
% of mental health budget
10 specialty psychiatric hospitals
35.2%
Psychiatric units in general hospitals (over 60)
22.5%
Community mental health
4.9%
OHIP payments and homes for special care
31.0%
Community care had thus not been emphasized in mental health care (Simmons 1990).
16.7 The era of psychiatric de-institutionalization
The advent of anti-psychotic medications in the 1960s heralded in a new era of psychiatric treatment. The early neuroleptic medications calmed some of the symptoms of patients
with schizophrenia, and allowed them to begin to resume their life, though supports were still required to make this possible. There were also negative side effects associated
with these medications, but they were nevertheless the first type of treatment that could begin to address patients’ symptoms.
As a result, the first wave of deinstitutionalization occurred in the 1960s and 1970s in Ontario and internationally, based on this innovation in psychiatric treatment.
De-institutionalization was guided by two philosophies. The first was the philosophy of social reform. Social reform emphasized the provision of humanizing care in the least
restrictive setting. It also recognized that care would be most appropriate if it was ‘closer to home’ and that recovery was most likely if persons with mental illness could remain in
and maintain their links to their community.
De-institutionalization was also driven by fiscal reform, in the sense that governments were under fiscal constraint and large asylums were expensive to operate. The closing of
psychiatric facilities thus allowed public expenditures to be reduced, and funds to be freed up for other purposes. An example was the closure of Lakeshore Psychiatric Hospital in
Toronto.
In Ontario in 1965, there were 15,257 psychiatric hospital beds.
In 1998 in contrast, there were 5,089 psychiatric beds; 2,833 of these were in general hospital psychiatric units, and 2,256 in psychiatric hospitals.
By 2005/6, there were about 3900 inpatient beds, 45% in general hospitals, and 55% in specialty hospitals.(Hospital Report Research Collaborative, 2007)
The overall number of psychiatric beds in Ontario was therefore reduced to about 26% of its peak level in 1965.
16.8 Deinstitutionalization in a vacuum
The unfortunate aspect of de-institutionalization in the 1960s and 70s was the lack of investment in housing and community mental health services, required to address the needs
of the persons who had been de-institutionalized.
While some of patients’ symptoms were calmed by anti-psychotic medications, they had serious side-effects and patients also needed housing, and continuing mental health care.
Unfortunately, these needs were largely unmet.
A large proportion of patients resided in dilapidated rooming housing under abhorrent conditions, or on the streets. And patients who managed to find accommodation still
required ongoing community care in order to become stabilized and rehabilitated, services which they largely did not receive, given the lack of attention paid to community care.
Moreover, there have always been shortages in psychiatrists, resulting in lengthy waiting lists for care. Other types of rehabilitative care were scarce and not always available. For
those patients who did not have families that could provide informal support, the scenario was often bleak.
Compliance with medications is also another issue. Given the strong side effects of the early anti-psychotic medications, many patients did not wish to take them, as they tended to
make them drowsy and numb their sensitivity to life, and had other types of physical effects. Some patients would prefer to accept the symptoms that go along with their illness
than have to take these medications. Unfortunately, when patients go off their medications they become more susceptible to episodes of acute illness, particularly if they are
under stress. Such episodes often lead to re-hospitalization in order to stabilize the patient.
16.9 Introduction of general hospital psychiatric units
Along with the decline in the use of psychiatric hospitals, was the move to create psychiatric treatment centres in general hospitals. The introduction of psychiatric units in general
hospitals however created a 2-tier system, whereby:
o The most seriously ill ended up going to a mental hospital (first tier).
o The mildly affected, depressed, but well-off went to general hospital psychiatric units (second tier).
The general hospitals were not always well equipped to provide care and treatment. What often happened is that the seriously ill would be admitted to a general or psychiatric
hospital, and be discharged after a certain length of stay. Given the lack of supports for them in the community, these patients often ended up back in the hospitals within a
period of time. This is referred to as the “revolving door syndrome."
16.10 The 3 solitudes
Given the discussion above, a system of three solitudes resulted, comprised of:
 specialty psychiatric hospitals – which were traditionally separate from other
hospitals*
o General hospital psychiatric units – which function autonomously & select
patients
o Community mental health programs
In providing appropriate care, these 3 forms of care must somehow be linked into an integrated whole, to provide a continuum of care to addresses patients’ needs for treatment,
rehabilitation
and
recovery.
* the provincial psychiatric hospitals have all now been devolved to community-run public hospital organizations. For example, the former Whitby Psychiatric Hospital is now
designated as a public hospital and is called Ontario Shores Centre for Mental Health Sciences.
16.11 Service fragmentation
A study that assessed patients with mental illness who were discharged from an in-patient facility, found that 2 years after discharge: only 24% had not been re-admitted and were
functioning well.
The problem is perceived as the fragmentation in services. If services are not linked to one another, patients may experience difficulty in navigating where they should go for their
varying needs. Patient needs are after all are very diverse, including housing, mental health services, rehabilitation and occupational health services, support for employment,
recreational services, etc.
16.12 Accountability: emerging issue in shifting to community care
A problem in accountability also exists in shifting to community care. In moving from a single institutional system to a system involving multiple settings in the community,
accountability gets lost in terms of who is responsible for overseeing patient care.
It is difficult to assign responsibility for care, as psychiatrists often have too heavy a case load to be able to follow-up with patients. A case manager is often required. However, the
linkages between a case manager, a patient’s family doctor, and their psychiatrist are often weak. Patients who at one time seem fine, can experience stress and relapse into an
acute state of illness. If no one takes responsibility for keeping in touch with them, they may end up “falling through the cracks.”
16.13 Comorbidity
A significant proportion of persons with mental illness also have a comorbid condition, that is, another disabiling condition, which is particularly the case for youth, and the elderly
Often the co-morbidity is an addiction to a substance. In these cases, patients are often not welcome from mental health providers, as providers indicate patients first need to
alleviate their addiction. At the same time, the providers in addictions services are not prepared to deal with someone with a mental illness.
Special mental health-addictions programs have been developed in most provinces. However, these programs often have long waiting lists, and it is difficult to get into them. Many
patients with co-morbidity or a dual diagnosis therefore do not receive appropriate treatment, as they may be refused by one or the other type of service provider.
16.14 Mental health care: overview
Let’s consider the types of mental health treatment provided in the last century, in order to get a better understanding of how care has evolved, and where it is going.
Where treated?
How treated?
1900-1960
Asylums, mental hospitals
Shock treatment, restraints, lobotomy
1961-1980
De-institutionalize (1st phase)
Medication: anti-psychotics
1981-2000
General hospitals (psychiatric units)
“Revolving door syndrome”
2000-2010
De-institutionalize (2nd phase)
Lack of affordable housing, unemployment, penal
incarceration
16.15 Goals of mental health care
In considering mental health care, it is important to remember that the goals of society are two-fold.
1. Rehabilitation of person with mental illness: the first goal is for health and social services to address the needs of the person with mental illness, in terms of their need for
services related to treatment, rehabilitation and recovery.
2. Protection of society: the second goal is to protect both the person affected by mental illness and society.
In addressing this second goal, the province of Ontario has enacted legislation related to community treatment orders, referred to as Brian’s Law. This legislation makes it possible
for providers such as psychiatrists or informal care givers such as family members to intervene into a person’s life who is suffering from mental illness and force them to be
admitted into an institutional setting (general or psychiatric hospital) or to force them to take their medication in the community. Recourse to this forcible treatment may occur if
there is a perceived risk of danger to the person affected by mental illness or others.
Prior to the enactment of Brian’s Law, the person or others would have had to have faced “imminent” danger, and if so, the legislation was such that the person would be confined
to an institution as long as a psychiatrist indicated this was necessary.
Brian’s Law essentially removed the word “imminent” from treatment orders, allowing health professionals or family members to intervene at an earlier stage of a person’s illness,
thereby making possible the forcible treatment of chronically ill persons who may pose a risk to themselves or others. The recent legislation therefore lowered the burden of
proof required for forcible treatment. It also made it possible to forcibly treat persons in the community, rather than institutional settings.
16.16 Exercise #1
Now, read an article by Dickinson. In this article Dickinson discusses the impact of the Canadian Charter of Rights and Freedoms.
How has the federal government assisted the provinces in understanding the implications of the Charter for mental health treatment? How do legal issues relate to mental health
treatment?
16.17 Challenges to mental health care
At the same time, there are several challenges associated with the treatment of persons with mental illness.
1. The first is the social stigma, and societal misconceptions of mental illness. Persons with mental illness are often treated with prejudice by society, and this as well as
misperceptions of mental illness can often hurt the persons affected, and inhibit them from participating fully in society. It can also prevent them from seeking care, if they
know they will be labeled and discriminated against if they admit to having an illness. Such stigma therefore compounds the effects of the illness.
2. Persons with mental illness need autonomy, and wish to have privacy. If they are hospitalized due to their mental illness, they may not wish their family or even their family
doctor be informed of their hospitalization. This can inhibit follow-up care.
3. Medical treatment is often provided without a recognition of the social supports required by persons with mental illness. This can prevent persons with mental illness from
recovering, as they require more than medication.
4. There is also a lack of coordination of community care. In the seminal Graham Report, commissioned by the Ontario Ministy of Health, Dr. Graham indicated that a lack of a
coordination of the various types of community services prevented patients from accessing the services they required, and led to gaps and duplications of services in many
cases.
5. The phenonmenon of transinstitutionalization. As the chapter by Dickenson describes, it is the process of shifting persons with mental illness “from one institutional setting to
another without solving the problem that motivated their discharge from mental hospitals in the first place” (Dickenson 2002, 383). This often occurs when a person with
mental illness becomes involved with the law, and ends up institutionalized within the penal system. It is unfortunate that a significant proportion of persons incarcerated
have mental illness, and are inappropriately treated within these institutions. That is, they do not receive the treatment they require for their mental illness, and the
incarceration only serves to exacerbate their illness. Models of court diversion programs for persons with mental illness have been developed, and are operational in parts of
Ontario, and elsewhere in Canada. However, these programs cannot meet the enormous demand on them and therefore a significant proportion of persons with mental
illness end up inappropriately incarcerated.
16.18 Exercise #2
List and describe the types of medical and social services that you believe persons with mental illness require or may require in order to live independently in the community. Why
would they require these services and supports? What would be the consequences if they did not receive them?
16.20 Addressing stigmatization
In 2006, the Senate Standing Committee on Social Affairs, Science and Technology published a report called Out of the Shadows: Transforming Mental Health, Mental Illness and
Addiction Services in Canada. The report recommended the establishment of a Mental Health Commission of Canada. In March 2007, the Commission was formed to provide a
pan-Canadian focus on mental illness and mental health. One of its first objectives is a 10-year campaign to reduce stigmatization of mental illness and addiction.
The Commission is also working on developing a mental health strategy for Canada, and has established 5 demonstration research projects to find ways of assisting the many
homeless people in Canada who have mental illnesses.
While this appears to be a positive step forward, it is early in the life in the Commission. It will be worth watching – and perhaps participating in the activities of – the Mental Health
Commission of Canada.
16.21 Community care
While the concept of community care is extremely important in terms of assisting persons with mental illness to re-integrate into their normal life, a number of obstacles remain.
These include:
1. Cutbacks to social assistance. When the Conservative government of Mike Harris entered office in 1995, they cut back social assistance payments by 22%. Since that time
there has been no significant increase in these payments, leading those who rely on social assistance to face challenges in finding affordable housing, etc. Although persons
with serious mental illness are entitled to a disability payment on top of this welfare payment, the conditions for disability payments are becoming difficult to meet, such that
persons for mental illness may technically not be eligible for them. Such financial challenges can cause persons with mental illness to live in poverty, which exacerbates their
condition.
2. The police often respond inappropriately when they apprehend someone with a mental illness who may be in an acute stage of psychosis. Rather than understanding the
person is ill, and trying to find an alternate way to deal with him or her, the police have been known to respond with force, leading to untoward consequences.
3. As discussed, there is often an inappropriate response from the legal system. It has been found that at least 25% of persons in correctional institutes have mental illness.
Although some court diversion programs exist, they are not readily available to provide access to all who need them.
4. Employment opportunities are also scarce. Often persons with mental illness can re-integrate back into a normal life and take on the responsibilities of a job. However, there is
often a prejudice towards them, and it can be difficult for persons with mental illness to find an employer who will accommodate their needs for flexibility. The Ontario
government has started to recognize this need, and started pilot programs with business groups, however these do not meet the demand currently present. Moreover, some
consumer groups have started consumer-run businesses, such as a consumer operated courier business. Again these opportunities are accessible only to a few clients, and
further government support is required.
16.22 Community care (continued)
Other initiatives have begun or are required in the community. These include:
1. “Consumer-survivor” movement: which is run by persons with mental illness and forms one type of informal care and peer support. Social and recreational programs such as
club houses are sometimes available, where consumers can provide informal support to those who need it.
2. Coordination of health and social services still remains a considerable challenge. While in most provinces, regional authorities are responsible for coordinating the variety of
agencies that provide mental health services, in Ontario the extent of coordination varies among provinces based largely on individual community initiatives.
3. “Assertive Community Treatment” (ACT) is one type of community care for patients with serious mental illness. Under ACT, a team of health professionals including a
psychiatrist, psychiatric nurses, occupational therapists, and social workers provide care in the community around the clock. That is, each ACT team has a case load of patients,
whom they visit in their home, and assist them in coordinating the variety of services available. The intent of ACT is to improve “continuity of care” for the patients who rely
on them in the community.
ACT teams are nevertheless expensive, as the cost of running them comes close to the cost of maintaining persons with mental illness in an institution. However, the outcomes
are better for the person, who receives personalized support and services in their home, while still taking responsibility for their lives and integrating back into their normal lives.
Given their high cost, not all patients are given access to ACT. Those who do not have access to ACT sometimes have a case manager, who assists in helping them manage the care
and issues they have. However, again, not all patients even have a case manager.
Many patients in fact never seek the care that they would benefit from, often due to the stigma associated with mental illness. Their condition can therefore deteriorate, and their
quality
of
life
can
be
very
poor.
It
is
not
uncommon
for
such
persons
to
end
up
homeless
and
on
the
street.
16.23 Ontario's discussion paper on mental health and addictions
The Ontario government released a discussion paper in July 2009 called Every Door is the Right Door. The purpose was to get input to guide a 10-year strategy on mental health and
addictions. Read at least the executive summary of the discussion paper (pages 9-11).
16.24 Exercise #3
Identify five top priorities for mental health and addictions reforms from the reading you have done in this lesson (identify your sources).
Comment on whether the Ontario discussion paper called Every Door is the Right Door deals with the issues, and if so, how.
16.26 Readings and references
Readings
Dickinson, H. “Mental Health Policy in Canada: What’s the Problem?” in B. Singh Bolaria and Harley Dickinson (editors) Health, Illness, and Health Care in Canada,Third edition,
Nelson, Thomson Learning, Scarborough, Ontario. 2002.
Minister's Advisory Group. Every door is the right door: towards a 10-year mental health and addiction strategy: a discussion paper. Available at
http://www.health.gov.on.ca/english/public/program/mentalhealth/minister_advisgroup/pdf/discussion_paper.pdf
Lesson 17
17.1 Introduction
There is intense interest in the pharmaceutical industry for at least a couple of reasons:
1. More money is being spent on drugs than on any other part of the health care system except for hospitals.
2. Drugs are not like other products for a variety of reasons:
1. there is rigorous testing before they can be marketed;
2. professional knowledge is required to use them;
3. the person who chooses the drug (the doctor) is not the one who uses it;
4. the government pays for drugs for a large segment of the population.
Drugs, if used properly, can have a very positive role in relieving symptoms, keeping people healthy and helping to cure disease. However, if used inappropriately, they are a
drain on health care resources and may do more harm than good. Drugs are researched, made and marketed by private corporations that are profit making entities. At
times, the companies’ interests in making money brings them into conflict with the public interest in making sure that drugs are used in the best manner. This lesson will
explore how this conflict of interests plays out in Canada in a number of contexts related to the pharmaceutical industry and the use of drugs.
17.2 Objectives
By the end of this lesson you should be able to:
1. Explain terms such as compulsory licensing, patents, generic medications, clientele pluralism and research and development.
2. State the role of the federal government in approving new drugs.
3. Explain how promotion affects the way drugs are used.
4. Specify how trade agreements have affected drug policy in Canada.
5. Identify the changing relationship between the pharmaceutical industry and government.
6. Identify some major factors influencing the substantial year-over-year increases in spending on drugs.
7. Understand how Canadian governments are trying to control drug spending.
17.3 Patents, compulsory licensing and generics
In the early 1960s, a series of three reports found that drug prices in Canada were among the highest in the world. All three reports attributed these high prices to the patent
system. A patent is a legal document giving the patent holder the exclusive right to sell a product until the patent expires. At that time the patent life for drugs (and all other
products) was 17 years from the date the patent was issued. In the 1960s it took about 3-4 years from the time the patent was issued until the drug was marketed. That 3-4 years
was the time needed to do all of the required testing. Therefore, companies had exclusive rights to sell drugs for 13-14 years.
The response of the federal government to the question of patents was to set up a system of compulsory licensing in 1969. If a company wanted to sell a drug while it was still under
patent protection it could go to the Commissioner of Patents in Ottawa and apply for a compulsory license. The “compulsory” part meant that the company holding the patent
could not block the issuing of the license. Once a company had a compulsory license it could sell its own version of the drug. These subsequent versions of the drug are usually
called “generics.”
17.4 Exercise #1
1. What would be the effect of generic drugs on provincial drug plans?
2. The brand name companies, the ones that produced the original drugs, claimed that allowing compulsory licensing was “piracy”, stealing their intellectual property. How do you
balance the rights of companies to profit from their discoveries with the need to have drugs priced at levels that are affordable?
17.5 Trade agreements and government policy
In the mid 1980s the newly elected federal Conservative government developed a policy of free trade with the United States. At the same time, the United States became
increasingly concerned about its negative trade balance (it was importing more than it was exporting) and set about making sure that other countries did not allow “theft” of
products developed by American companies. The U.S. government saw compulsory licensing as a form of theft and in return for agreeing to a free trade deal (the Free Trade
Agreement) it demanded that Canada modify its rules about compulsory licensing. In the early 1990s Canada signed the North American Free Trade Agreement (NAFTA) and the
agreement setting up the World Trade Organization (WTO). The government claimed that compulsory licensing was illegal under these agreements and passed a law abolishing it.
17.6 Drug promotion
It has been estimated that drug companies spend about $2 billion every year promoting their products to Canadian doctors or about $24,000 per doctor. This promotion takes many
forms including giving free samples of medications to doctors, advertising in medical journals, sending sales representatives to visit doctors in their offices and sponsoring medical
meetings.
In the United States companies are also allowed to advertise prescription medications directly to the public via television, newspapers, and in magazines. In 2004, over US $4 billion
was spent on direct-to-consumer advertising (DTCA) (Health Council of Canada, 2006). There is increasing pressure to allow DTCA in Canada.
17.7 Exercise #2
Go to http://www.whp-apsf.ca/en/documents/dtca.html This publication is a critique of DTCA.
Discuss
the
following
topics
and
summarize
the
arguments
for
or
against
DTCA:
1. The right for consumers to have information about medications.
2. Communication between doctors and patients.
3. Treatment that patients receive.
4. Changes in public health.
17.8 Clientele pluralism
“Clientele pluralism” is a term used to describe the relationship between the federal government and the pharmaceutical industry. The authority to regulate drugs is concentrated in
a single branch of the government, the Therapeutic Products Directorate (TPD) which is a part of Health Canada. However, the TPD has limited resources. The pharmaceutical
industry is represented by Canada’s Research-Based Pharmaceutical Companies (Rx&D) which has the authority to act on behalf of its members in a number of key areas and to
bind its members to agreements. Under clientele pluralism the government turns over some of its authority to the companies. For instance, although the Food and Drugs Act
allows the government to regulate promotion by drug companies, the government has allowed the companies to regulate themselves.
17.9 Spending on drugs
Spending on drugs is now only second to hospital costs as a percent of the health care dollar in Canada. Overall, expenditures on drugs were 16.4% of all spending on health care in
2009, compared to 9.3% in 1985 (Canadian Institute for Health Information, 2009).
17.10 The reasons for cost increases
There are a number of reasons for this increase in drug spending but the main ones are the fact that more prescriptions are being written and that they are being written for more
expensive medications. The pharmaceutical industry argues that this increase is justified because although new drugs are more expensive than older ones they are also more
effective and instead of people having to be hospitalized and have surgery they can now be treated as outpatients with medications.
Read a brief article by Professor Steve Morgan and others called "'Breakthrough' drugs and growth in expenditure on prescription drugs in Canada" published in the British Medical
Journal in 2005. This article provides a surprising conclusion about the cause of the increase in prescription drug spending from 1996 to 2003.
Another must read article in terms of pricing is "The TSX gives a short course in health economics" by Robert G. Evans (2010). It explains the real reason why cost always increase.
17.11 Expensive drugs with small marginal benefits
In an article in the Journal of the National Cancer Institute, Fojo and Grady provided some information about new drugs recently approved for treatment of various cancers in the
United States. Table 1 is drawn from their article, and indicates the total cost for a course of treatment using certain drugs and the overall increase in survival from the median
survival time without the drug.
Table 1
Drug (brand name)
Total cost for treatment (US$)
Increase in overall survival
$80,352
1.2 months
$90,816
1.5 months
$15,752
10 days
$34,373
2.7 months
Cetuximab (Erbitux)
for non-small cell lung cancer
Bevacizumab (Avastin)
for breast cancer
Erlotinib (Tarceva)
for pancreatic cancer
Sorafenib (Nexavar)
for renal cell carcinoma
They also make the point that though they highlighted these four drugs, expensive drugs – especially for the treatment of cancer – are becoming more common: 90% of the
anticancer agents approved for use in the US over the last 4 years cost more than US$20,000 for a 12-week course of treatment.
Read the following sections of their article: the section entitled “The Costs of Cancer Treatments” (page 1045, second column) and “New Drugs as Stepping Stones” (page 1046, first
column).
17.12 Attempts to control spending
The federal government and the provinces, in an attempt to limit costs, have implemented a series of measures to reduce expenditures. Read the article by D.
Menon, "Pharmaceutical cost control in Canada: does it work?"Health Affairs 20(3), 92-103.
Among the issues Menon discusses is the role of the federal Patented Medicines Prices Review Board (PMPRB) which sets limits on the price for new patented medications. Menon
also sets out the industry's argument against the criteria that the PMPRB uses.
Then, scan the recent Ontario government plan to get better value from its drug spending. In April 2010, the government "effectively halved effectively halved the rate of
reimbursement of ingredient costs and banned the 'professional allowances' (kickbacks) paid to pharmacies by generic manufacturers. Taxpayers and private payers will save
hundreds of millions of dollars, and pharmacy revenues will fall by an equivalent amount. Patients will still get their drugs, with no loss of quantity, quality or even convenience;
no one’s health is threatened. But investor profits will fall."
(Evans, 2010, p.13).Soon after the Ontario government's new policy was announced, other provincial governments joined in, but did not go quite as far as Ontario.
17.13 Exercise #3
1. Bearing in mind all that you have read, do you think that the pharmaceutical industry's criticisms of the pricing policies of the PMPRB are valid?
2. If provincial governments continue to control costs then the pharmaceutical industry may not introduce some new drugs into Canada. How would you balance the need to be
able to fund drug programs with the need for new medications? What are the various ways to control drug costs?
3. What are the ethical issues involved in deciding to permit the sale of, and to pay publicly for, expensive drugs with relatively small benefits for the people who take them?
17.15 Readings and references
http://www.whp-apsf.ca/en/documents/dtca.html
Evans, Robert G. (2010). The TSX gives a short course in health economics: it's the prices, stupid! Healthcare Policy, 6(2), 13-23.Fojo, T. and Grady, C. (2009). How much is life worth:
Cetuximab, non-small cell lung cancer, and the $440 billion question. Journal of the National Cancer Institute, 101(15), 1044-1048.Menon, D. (2001). Pharmaceutical cost control
in Canada: does it work? Health Affairs, 20, 92-103.
Morgan, S. G., Bassett, K. L., Wright, J. M., Evans, R. G., Barer, M. L., Caetano, P. A., & Black, C. D. (2005). "Breakthrough" drugs and growth in expenditure on prescription drugs in
Canada. BMJ, 331, 815-816.
Lesson 18
18.1 Introduction
The focus of this lesson is on the evaluation of health policy, health management, and health informatics programs and initiatives. Evaluation is a particularly complex enterprise as
it involves a judgement of the value or worth of a program, strategy or policy. Given this ultimate goal, it is very important that the goals or objectives of an initiative be specified
so that a proper evaluation of it can be undertaken.
In this lesson, we explore some current issues related to evaluation. The issues here also involve the extent to which values, as well as evidence, influence the planning and carrying
out of evaluations and whether evaluations should focus on the impacts of initiatives on individuals, communities, or whole societies.
18.2 Objectives
Upon completion of this lesson, you should be able to:
1. Identify the differences between research and evaluation.
2. Outline the distinctions between needs assessments, formative, summative, process, and outcomes evaluations, and the purposes of each of these.
3. Provide examples of different forms of evidence: instrumental, interactive, and critical.
4. Outline a plan for carrying out an evaluation of a community initiative.
5. Outline a plan for carrying out a health impact assessment of a government policy.
o 18.3 Research versus evaluation
o While there are many similarities between research and evaluation, there are also some key differences. The Canadian Oxford Dictionary defines these terms as follows:
o re·search
o 1a the systematic investigation into and study of materials, sources, etc., in order to establish facts and reach new conclusions. b (usu. in pl.) an endeavour to discover new or
collate old facts etc. by the scientific study of a subject or by a course of critical investigation.
o eval·u·ate
o 1 assess, appraise (evaluate the situation) 2a find or state the number of amount of. b find a numerial expression for.
o While both activities involve finding out about the world, evaluation is specifically concerned with providing a judgment upon the value of an initiative (program, strategy or
policy). Evaluation also has a commitment to providing information that will be of more immediate value for the ones conducting the evaluation or being served by the initiative.
This value may involve changing an initiative in order to improve it, or terminating it, if it is found to be ineffective.
o In contrast, research does not necessarily have a goal of providing information that can be easily applied to solving existing problems or dealing with current issues. Research can
be concerned with providing knowledge for knowledge’s sake without an apparent application. Evaluation, therefore, can be seen as a more applied activity, research potentially
less so.
o In both cases, however, careful thought must be given to developing the purpose of the research or evaluation. Care must be taken to develop a careful research or evaluation
design that will allow the specific questions being asked to be answered. Data must be carefully collected and analyzed. The meaning of findings must also be outlined so that they
can be put to good use. Good and competent evaluators are also careful researchers.
18.4 The scope of evaluation
Scope
Evaluation typically refers to the evaluation of programs, but can also apply to the evaluation of broader strategies, or governmental policies. In this lesson all three of these
activities are referred to as initiatives.
Programs
Programs are usually limited activities that have a specific purpose or goal. Programs are usually carried out by local or community agencies. Some examples of programs that could
be evaluated are:
o initiatives to promote smoking cessation
o a plan to promote early discharge of newborns from hospitals in order to achieve costs savings
o health centres establishing a new management information system
o a university or health agency establishing a new approach to informatics training
o a hydro company establishing a energy conservation program through use of specific fee changes
o a city setting up special lanes for drivers who car-pool
Strategies
Strategies are usually broader in scope and involve a set of initiatives in order to achieve more substantial effects than could be achieved by programs alone. These may involve a
level of government or a number of agencies such as a hospital network. Some examples of strategies that could be evaluated are:
o a province deciding to establish a series of community health centres
o integration of health and community services
o a hospital network converting to electronic patient record keeping
o a regional health authority establishing citizen boards for regional health boards
o the health branch of a ministry adopting an anti-poverty strategy for public health practice
o a hospital network developing an approach for increasing and improving communication between hospitals and community-based service agencies.
Policies
Policies usually involve broad decisions by governments. Some recent policy changes by Canadian governments that could be evaluated are:
o changing employment insurance benefits or eligibility
o reducing or increasing social assistance rates
o allowing direct marketing of pharmaceuticals to the public
o allowing privately-operated health care facilities to bill public health insurance plans
The effects of policy changes are usually broad, complex, and far reaching. Therefore, they usually require complex evaluations.
18.5 A taxonomy of evaluation activities
There are a variety of activities that fall under the general category of evaluation. Some of these have what is called a temporal (time) dimension. For example, needs
assessments usually take place before an initiative (program, strategy, or policy) is established. A formative evaluation usually takes place while an initiative is in operation. The
primary aim of a formative evaluation is to decide how to improve the program, strategy, or policy. A summative evaluation usually takes place at the end of an initiative. The
purpose of these is to decide whether to continue or discontinue an initiative.
Additionally, an evaluation can involve the determination of whether an initiative has been implemented correctly. This is known as an implementation study. Anoutcome
study determines whether specific goals have been met. Implementation and outcome evaluations have some similarities with needs assessments, formative evaluations, and
summative evaluations.
Needs assessment
A needs assessment takes place prior to the development or implementation of an initiative. The questions that such a process can ask include the following:
o What needs attention?
o What should our initiative (program, strategy, policy) be trying to accomplish?
o Where are we failing?
Formative evaluationA formative evaluation takes place during the implementation of an initiative. The questions that such a process can ask include the following:
o How can the initiative (program, strategy, policy) be improved?
o How can it become more efficient or effective?
Summative Evaluation
A summative evaluation takes place at the end or near the end of an initative. Some of the questions that such a process could ask include the following:
o Is the initiative (program, strategy, policy) worth continuing or expanding?
o What conclusions can be made about the effects of the initiative (program, strategy, policy) or its various components?
Implementation Study
In an implementation study the following questions could be asked:
o What is happening in the initiative (program, strategy, policy)?
o To what extent has the initiative (program, strategy, policy) been implemented as designed?
o How much does the initiative (program, strategy, policy) vary from site to site?
Outcome Study
In an outcome study, the following questions could be asked:
o To what extent is the initiative (program, strategy, policy) meeting its goals?
o Is there steady progress towards the attainment of objectives?
18.6 Effectiveness, efficiency, equity: determining goals and evaluation criteria
Since evaluation involves the determining of the value or worth of an initiative, it is important to be clear about the goals of the initiative. Determining goals is a complex task as it
involves issues of values, belief in particular paradigms of health and well-being, and potential disagreements among those (stakeholders) who are affected by the initiative
(service providers, clients, government funders, differing professional groups, etc.)
For some, the determining value that should guide the development of goals is that of effectiveness. To what extent does the initiative reach its goals? Or is the guiding value one of
efficiency, that is, reaching goals at the lowest possible cost, or achieving the most for a given cost? Or, should the guiding value be one of equity: the extent to which resources
and services are provided on a just or fair basis?
Initiatives may have a number of potential goals. Some of these are easily measured such as the number of patients seen by an agency. But other goals can be more complex, such
as satisfaction with a service, or providing clients with a greater sense of control or self-efficacy after experiencing an initiative.
The determination of goals of an initiative can be done in many different ways. Some questions that can guide this process are the following:
o Should goals be set by experts?
o Should goals be set by service providers (policy makers)?
o Should goals be set by clients (the public)?
Another set of questions involve determining the criteria by which an initiative will be evaluated, for example:
o Is the initiative (program, strategy, policy) effectively meetings its goals?
o Is the initiative (program, strategy, policy) meeting its goals efficiently?
o Is the initiative (program, strategy, policy meeting its goals in a manner that is ethical, equitable and fair?
18.7 Framing the questions: what is the focus of the initiative and related evaluation?
What is our initiative about? Is it about influencing individuals? That is, changing their ideas, attitudes, or behaviours? Or is the initiative about changing an organization or agency?
That is, changing the processes, reporting mechanisms or its client sensitivity? Or is the initiative about changing the way that a society operates, that is, its levels of poverty, the
effectiveness of the health care system, or the extent of citizen participation?
Getting Data from Individuals If the focus of the initiative is on changing or influencing the ideas, attitudes, or behaviours of individuals, then a variety of data types can be
collected. These are focused on individuals’ ideas, individuals’ attitudes, or individuals’ behaviours.
Individuals’ Ideas
Sometimes we are concerned with changing people’s ideas about something. This could be their knowledge of what leads to a healthy life, their beliefs about the health care
system, or their understandings about ways of accessing quality health care. It could also involve their ideas about managing a workplace, or using a new information system.
In these cases an evaluation would try to ascertain whether their ideas about the area of interest have changed as a result of the initiative that has been implemented.
Individuals’ Attitudes
Attitudes refer to individuals’ feelings towards something. An evaluation could be concerned with how various individuals now respond to persons, objects or even programs as a
result of our initiatives. One example could be a person’s attitudes towards a new management style or a new patients’ record keeping system. The words “like,” “prefer,” and
“feel positively or negatively towards” illustrate the idea of attitudes.
Individuals’ Behaviours
Behaviours refer to observable actions on the part of individuals. An evaluation could gauge whether an initiative has led to changes in specific behaviours such as attending a clinic,
using a new system, or changing one’ s management style.
Getting Data About Institutions
Frequently, an evaluation can be focused on the operations of an institution or a system. In these cases, an evaluation could focus on an institution’s effectiveness, efficiency, or
commitment to equity.
Effectiveness is about the extent to which an institution is reaching its goals. These goals must be clear, and data must be identified that will allow this question to be answered.
Efficiency is about whether the institutions is reaching its goals in a cost-effective manner. This goal must be balanced against other goals such as effectiveness and equity.
Equity is about whether an institution is going about its activities in a fair and just way. Clearly, some consensus must be reached about what constitutes justice or fairness in order
that this goal can be evaluated.
Getting Data About Societies
Getting data about societies can involve looking at various measures of how well the society is doing. These data can involve social indicators, population survey data, or statistics on
various illnesses or diseases.
Social indicators are broad measures about society. These can include employment and unemployment rates, percentage of a country’s economic output spent on services, or
number of people in training or education programs.
Population survey data come from surveys of a population. They can indicate general degree of satisfaction with life, attitudes towards various issues, or measures of health related
beliefs, attitudes, or behaviours.
Statistics on illnesses or diseases come from health care records and indicate the overall health and well-being of citizens within a nation, province, or locality. They can focus on
physical illness, mental illness, use of hospitals, or other health-related measures.
18.8 Measuring achievement of goals
In evaluating an initiative, it is important to have a clear idea of what kind of measure will be used to determine if goals have been met.
For example, if a health care agency’s goal is to improve the satisfaction of its patients with the length of wait to receive a specific service, it would be reasonable to gather data
from individuals in a satisfaction survey after they receive the service to determine their attitudes toward the service. However, what would the measurebe?
o It might be the average score from a question on a survey that asked people to rate the quality of the service on a scale of 1 to 10, with 1 being “horrible” to 10 being
“awesome”.
o Or, it might be the predominant (most frequent) answer to a question that asks people to rate whether the wait for the service was “too long”, “just right” or “quick”.
o Or, there might be two surveys, one before the wait and one after. Before they receive the service, people could be asked to say how long, in hours or days, they expect to
wait for the service. After, they could be asked whether the wait for the service was “too long”, “just right” or “quick”. The two responses could then be compared.
Think about what information might be revealed to an evaluator with each of these examples. Also, think what an evaluator might not know if she or he used the measures in
these examples.
18.9 Exercise #1
1. Identify 3 possible goals that a hospital could have.
2. For each of the 3 goals, identify (1) the kind of data that would be used to evaluate whether the goal has been achieved, and (2) suggest a measure that could be used to
evaluate whether the hospital has achieved the goal.
18.10 Models of data collection
Peter Park (1993), using Habermas (1972) as a starting point, outlined three forms of knowledge/evidence that can be used in evaluation: instrumental, interactive, and critical. Each
form of evidence can be used as part of needs assessments and evaluations.
Instrumental Knowledge
Instrumental knowledge is also known as traditional, scientific, positivist, quantitative, or experimental knowledge. Instrumental knowledge is developed through traditional
scientific approaches and is concerned with understanding physical and social environments. Its philosophical traditions include positivism and operationalism. Instrumental
knowledge is drawn from traditional research and data collection methods.
In evaluations these kinds of data would involve the designing of controlled experiments with control groups to assess the impacts of an initiative. This could involve the collection
of “hard” data such as observations, questionnaire data, or outcome data such as incidence of disease or sickness. This is the dominant approach used within health research.
Most of what we hear about from medical journals involving experiments and detailed clinical trials reflects this kind of knowledge.
Interactive Knowledge
Interactive knowledge is derived from lived experience. It is also known as constructivist, naturalistic, ethnographic, or qualitative knowledge and its focus is on meanings and
interpretations provided by individuals. Its theoretical bases are phenomenology, symbolic interactionism, and grounded theory.
In evaluations, these kind of data would be collected through extended open-ended interviews where people would talk about their experiences of an initiative. It could also involve
detailed participant observation where an evaluator would spend time within the environment associated with the initiative. This could involve experiencing the initiative itself
and reporting on how it appeared to impact its participants. This approach is common among cultural anthropologists and other researchers who use field research methods.
Critical Knowledge
Critical knowledge is also known as reflective knowledge. Examples of critical knowledge approaches are critical, materialist or structural, and feminist theory. Critical knowledge is
derived from reflection and action on what is right and just. It is concerned with the role that societal structures and power relations play in promoting inequalities and
disenabling people.
The goal of this kind of evaluation would be to illuminate these health-harming societal structures and raise consciousness about the causes of problems and deriving means of
alleviating them. In terms of an evaluation, it would help to identify whether the initiative had unintended side effects that were actually harming initiative recipients rather than
helping them.
Some evaluators examined whether children’s breakfast programs in Atlantic Canada were reducing or increasing inequities among poor and not poor children. They came to the
conclusion that there were many negative aspects of these breakfast programs that led to stigmatization of children, and fostering dependency among poor families.
18.11 Exercise #2
1. Give 3 examples of something you know about the world for each of the 3 kinds of knowledge (total of 9 examples).
2. Which things that you know do you feel most sure of?
3. How easy would it be to convince somebody else of a belief based on each of the different forms of knowledge?
4. Why do you think that is so? (You may find it helpful to think of the paradigms work we did in the first term
18.12 Carrying out an evaluation: two approaches
There are a variety of schemes for developing an evaluation. Two examples of these are presented. One is from the Community Work Station at the University ofKansas and is
concerned with evaluating community initiatives. It is located at http://ctb.ku.edu/en/tablecontents/sub_section_main_1338.htm
The other is concerned with the health impact of policies and comes from the International Health IMPACT Assessment Consortium. It can be found
athttp://www.liv.ac.uk/ihia/IMPACT%20Reports/2001_merseyside_guidelines_31.pdf
The University of Kansas Guide
Steps in evaluation
Engage stakeholders
o Decide who has an interest in this initiative and its evaluation. These could involve the funders of the initiative or its evaluation, the clients, the service providers, or the policy
makers. It could also include the general public as community members.
Describe the program
o Provide a description of the initiative. What its purposes are, how it came about, and what it hopes to achieve.
Focus the evaluation design
o Decide how you are going to decide whether the initiative has achieved its goals. Decide upon the kind of evidence you are going to collect.
Gather credible evidence
o Gather the kinds of evidence that will answer your research questions. Make sure that the evidence will be adequate to answer your questions.
Justify conclusions
o Based on your analysis of evidence, come to, and justify your conclusions
Ensure, use and share lessons learned
o Try to make sure that your conclusions are understood and applied by stakeholders.
18.13 Exercise #3
Go to the University of Kansas website at http://ctb.ku.edu/en/tablecontents/sub_section_main_1338.htm and review the material there. Then imagine a community initiative
to vaccinate all people in the community with high risk of complications from the H1N1 flu.
o Describe the initiative.
o Who are the potential stakeholders?
o How would you evaluate it?
o What kinds of evidence would you use?
o How would you try to assure that the information you gather is used
18.14 Health Impact Assessment - Merseyside Health Consortium guidelines
According to these guidelines, the following processes should be followed in order to assess the health impact of a government strategy or policy.
1. Screening, to select policies or projects for assessment.
2. Using some criteria decide which policy you are interested in assessing health impact.
3. Establish a Steering Group and agreeing on Terms of Reference.
o This will allow stakeholders to contribute and feel part of the assessment.
4. Carry out the health impact assessment.
o Using the criteria established from the Kansas program, for example, the assessment can be carried out.
5. Monitor and evaluate processes and outcomes of the Health Impact Assessment and providing feedback to influence continuing review.
o This will allow for a success assessment.
Methods for undertaking a HIA include:
1. Policy analysis (where appropriate)
2. Profile the areas and communities affected.
3. Involve stakeholders and key informants in predicting potential health impacts, using a predefined model of health
4. Evaluate the importance, scale and likelihood of predicted impacts
5. Consider alternative options and making recommendations for action to enhance or mitigate impacts
18.15 Exercise #4
Go to the International Health IMPACT Assessment Consortium website for the Merseyside Guidelines for Health Impact Assessment
at http://www.liv.ac.uk/ihia/IMPACT%20Reports/2001_merseyside_guidelines_31.pdf and review the material there. Then, think about a government policy to increase the
minimum wage to reduce poverty in a province and answer these questions.
1. Imagine the government policy and provide a brief outline of it
2. Who are the potential stakeholders?
3. How would you assess its impact?
4. What kinds of evidence would you use?
5. How would you try to assure that the information you gather is used?
18.18 Reading and references
Readings
Raphael, D. (2000). The question of evidence in health promotion. Health Promotion International, 15, 355-367.
International Health IMPACT Assessment Consortium:
Scott-Samuel A, Birley M, Ardern K. (2001). The Merseyside Guidelines for Health Impact Assessment. Second Edition, May 2001. University of Kansas website
athttp://ctb.ku.edu/en/tablecontents/sub_section_main_1338.htm
Lesson19
19.1 Introduction
As you know from previous lessons, one of the best ways to improve population health in Canada would be to decrease social inequality. You also know that taking this tack is not a
priority for the Canadian or provincial governments. By contrast, governments continue to spend increasing amounts of money on the prevention and treatment of disease
through conventional means. Some critics believe that because of this spending the system is out of control and efficiencies must be introduced into the health care system.
Others feel that the proportional amount of money being spent on health care in Canada is not increasing.
Whatever the case, most commentators on the health care system in this country believe that the development and implementation of health care informatics systems will enable
Canadians to utilize current and future health care resources to the utmost. The implementation of such systems will contribute to the effective administrative and clinical
operation of the health care system. The focus of this lesson will be on the current state of health care informatics in Canada and elsewhere.
19.2 Objectives
By the time you have completed this lesson, you will be able to:
1. Define health informatics/eHealth.
2. Outline the development of computational devices that have contributed to the development of health informatics.
3. List the factors limiting the growth of health informatics in developed countries and in the Third World.
4. Describe the characteristics of Administrative Decision Support Systems.
5. Describe the characteristics of Clinical Decision Support Systems.
19.3 Definition
According to Englebardt and Nelson (2002, p. 528), health care informatics can be defined as:
The study of how health data, information, knowledge, and wisdom are collected, stored, processed, communicated, and used to support the process of health care delivery to clients
and for providers, administrators, and organizations involved in health care delivery.
19.4 The role of technology
As might be expected, health data collection, storage, processing, and communication are related to the nature of the technology that is available to carry out these tasks. For
example, at the administrative level, prior to the development of modern computers, there was no option but to collect and store a hospital patient’s information on paper. Upon
entry to a hospital, paper forms would be filled out recording the patient’s demographics and other information. Once admitted to hospital, the patient’s condition and progress
would similarly be recorded in paper form (the ‘chart’). If a patient was to be moved from one part of a hospital to another, her chart would physically accompany her. You may
have seen a television medical shows or movie in which a doctor examines a patient’s chart that is hanging from the bottom of her bed. As you will see later, however, it is now
possible to collect and store a patient’s information in a computer electronically.
In the past, at the clinical level, when it came to diagnosing a patient’s problems, the results of examinations and tests would similarly be committed to paper and sent back to the
doctor for interpretation. Current computer based systems now make it possible not only to record test results automatically in a computer so that they are immediately
accessible by the doctor, but also for the results of examinations and tests to be merged with other information already collected on the patient, such as prior medical history. The
result can be enhanced administrative efficiency for the health care system and better treatment for the patient.
19.5 A bit of history
The complexity of computational operations that can be carried out by human beings are related to their ability to remember things. We can all add 2 +2; however, 2(2 + 2)/6(4/3) is
a little more difficult to deal with. Similarly, we can remember the names of two new people we meet, but remembering 12 new names is a more formidable task.
Computational tools such as the abacus have assisted in tasks requiring memory and have been in existence for thousands of years. In 1890 in the United States a device was
developed that helped in the tabulation of the millions of records collected in the census. To some, this invention marked the beginning of medical informatics in the United Sates.
The advantage of computers is that they can assist us in clearly remembering and analyzing more information than we can process in our heads. Computers as we currently know
them were first developed in the Second World War by the Germans and British for military and security reasons. In the post-war era, the greatest impetus to computer
development came from the need to calculate complex missile flight paths. Calculations that may have taken years to complete by hand, could now be finished in seconds.
The Early Computer
In these early years, computers were much different than they are now. For example, the Electrical Numerical Integrator Computer (ENIAC) developed in the United States in 1946
weighed more than 30 tons and had 19,000 vacuum tubes. The later development of transistors and silicone chips made it possible to displace vacuum tubes and the size and
weight of computers began to decline. We all know that today computers can be very small yet carry out sophisticated tasks.
Developments in the 1960s
In the 1960s, computers were first used in the health field in the area of hospital administration – keeping records, billing, and so on. The application of computer technology to
clinical care followed. For example, the electrocardiogram and electroencephalogram developed in the 1960s both utilized computers.
Developments in the 1970s
In the 1970s there were further developments in managing nursing and health information. In Canada, for example, York Central Hospital in Richmond Hill developed a
computerized patient care system. At the same time family physicians had computerized medical information records and health care data bases made available to them by the
Canadian government. Also, the 1970s saw the increased development of relational data bases. As a result, systems were designed that could remind doctors to collect more data
on patients with particular problems, order a diagnostic test, and change a therapy regimen.
Developments in the 1980s In the 1980s Canada continued its expansion of health care informatics systems. During the decade, the ability to move documents between locations
accelerated the development of networked health information systems in many countries. In addition, attempts were made to use symbolic reasoning to develop diagnostic
systems that would eliminate some of the guess work in the clinical realm (expert systems). It was found, however, that the diagnostic process was far more cognitively complex
than had been thought, and it was recognized that expert systems had limitations.
Developments in the 1990s By the 1990s systems had been developed that could store and retrieve financial, administrative, medical, nursing, pharmaceutical, dental, and
consumer information that was relevant to health. Such systems were based on computers and networked telecommunication devices like telephones, wireless radios, satellites,
and high speed fibre-optic cables. Health care informatics were further revolutionized in the 1990s by the continued improvement of file transfer protocols (FTPs), that facilitated
the movement of data files from one location to another.
19.6 Factors limiting the development of informatics
Although there have been continuous improvements in health care informatics, Engleberdt and Nelson (2002, p. 470) pointed to four factors that are hindering world-wide
development.
1. Lack of a standard nomenclature or language. This is more of a problem in the United States than in Europe because in the former competition among developers has resulted
in less co-operation than in the latter.
2. Limited funding for the development of clinically based decision support systems.
3. In the Third World, the absence of money, personnel, electricity, and reliable telephone systems.
4. Differences in funding for national health care systems.
19.7 Exercise #1
You know from other lessons in this course that there are differences in the ways in which the Canadian and American health care systems are funded. Why would differences such
as
these
affect
the
development
of
health
care
informatics
systems?
19.8 Administrative systems
In all nations, health managers are faced with the challenge of delivering the best health care possible with available resources. In this connection, Grossman (1994, p. 24) points out
that the challenge of health managers is:
o to track and organize a wealth of data to distinguish between necessary and inappropriate services, to identify opportunities for greater efficiency, and
o to project the cost implications of substituting one form of treatment for another.
More specifically, as pointed out by Englebart and Nelson (2002, p. 84) health managers must deal with the following:
o The mandate by patients, payers, and compliance agencies to precisely measure and quantify services provided and their costs and quality.
o The need to respond to financial pressure stemming from the increasing demand for and intensity of services provided, which is balanced against a growing payer revolt
against the associated price of health care.
o The pressures to recruit, retrain, pay, and effectively deploy the health care workforce.
o The management of workload variability either caused by fluctuations in demand for care in intensity of services or resulting from directional strategies employed by the
health care institution.
o The efforts to reduce variation in practice reflected by protocol-based health care.
In dealing with issues such as these, health care managers can use Administrative Decision Support Systems (ADDS). According to Turban (1993, p. 87), “ADDS is an interactive,
flexible and adaptable computer-based information system (CBIS) specially developed for supporting decision making related to the solution of a particular management
problem.” Turban goes on to say that, “It utilizes data, it provides easy user interface (UI), and it allows for the decision maker’s own insights.”
19.9 Clinical systems
Physicians, nurses, and other health care workers can be subjected to a considerable amount of stress in their jobs. Under circumstances such as these, mistakes are sometimes
made. Baker et al (2004) estimate that there are approximately 70,000 preventable medical errors in Canadian hospitals each year.
As you saw previously, ADDS can assist in the carrying out of the administrative function of health care organizations. Clinical Decision Support Systems (CDSS) have been used to
improve the clinical operations carried out in health organizations.
Englebart and Nelson (2002, p. 116) define a CDSS as: An automated decision support system (DSS) that mimics human decision making and can facilitate the clinical diagnostic
processes, promote the use of best practices, assist with the development and adherence of guidelines, facilitate processes for improvement of care, and prevent errors.
The same authors (p. 117) also point out that there is some resistance to such systems for five basic reasons:
1. Narrowness of scope of the applications.
2. Mistrust of the clinical decisions made by the system.
3. Inability to incorporate new discoveries into the rule bases.
4. Nonportability to the CDSS to other computer systems.
5. Lack of integration with existing systems.
19.10 Telemedicine & telehealth
As in any rapidly evolving information and communication technology (ICT) field, definitions change and adjust according to a myriad of determinants. An example of this evolving
ICT field is the distinction - or lack of distinction - between telemedicine andtelehealth.
Telemedicine which was conceived in the 1970s is the provision of health care services, clinical information, and education over a distance using telecommunication technology
(e.g., telephone, video, cable TV, etc.). It existed long before the Internet. Some of the first telemedicine reports were of group therapy, nursing interactions, health education and
training, televisits to community health workers, medical image transmissions, home care and other applications. In many early cases, no physicians were involved, and
interactivity was not a necessary part of the transaction.
Telehealth is seen by some as being a more encompassing term than telemedicine, which many define as restricted to interactive patient-physician teleconsultations. Other
dimensions have been used to point out the distinctions. The WHO described telehealth as the integration of ICT systems into the practice of protecting and promoting health,
while telemedicine is the incorporation of these ICT systems into curative medicine.
In Ontario, however, “telemedicine” is the term used for teleconsultations: see a short video at http://www.otn.ca/ (click first on Healthcare Providers under the video monitor, and
when finished that video, click on Patients and Families under the video monitor). “Telehealth” is used to describe a public service of free confidential access to a registered nurse
at any time. Seehttp://www.health.gov.on.ca/en/public/programs/telehealth/.
19.11 Privacy and confidentiality
Privacy and confidentiality are not new concerns in the health field. The confidentiality of patient-physician relationship has a legal and philosophical foundation developed over
many years. The use of powerful electronic health information systems and the integration of those systems through advanced networks add new layers of complexity, if not risk.
Personal health records contain information that can be exploited by others. The media have made privacy a recurring theme, frequently focussing on fear-provoking stories about
security breaches on the Internet, for example.
In a world of networked information, the danger scenario is easy to paint: hackers altering health records just for fun; corporations stealing records to better target potential
customers; or, worse yet, insurance companies or employers accessing an individual’s private health information to his or her detriment.
The real threat may not result from the new technologies making personal data inherently more accessible, but from the potential value to others once the data have been collected
and stored in one place for legitimate purposes.
Other researchers are seeing the technology as the saviour of data protection in health, not a threat to it. They point to the fact that, today, an estimated 70% of violations of this
sort involve trusted insiders in the health system, and that improved security technology will prevent many of these people from having the kind of unfettered access that the
current paper system provides.
Privacy: The right of individuals to determine when, how, and to what extent they share information about themselves with others.
Confidentiality is based on a special patient-doctor relationship and “refers to the expectation that the information collected will be used for the purpose for which was gathered”
Threats to confidentiality:
o Innocent mistakes – accidental disclosure
o Abuse of access privilege
o People are curious
19.12 Exercise #2
19.13 Exercise #3
o Insiders divulging information
o Outsider attacks
o Access for profit purpose – secondary use
Search the internet and make a list of the legislation (both federal and provincial) that protects health data privacy and confidentiality in Canada.
Read the articles by Chandrasekhar CP and Ghosh J. 2001. Information and communication technologies and health in low income countries: the potential and the constraints.
Bulletin of the World Health Organization. 79;850-855, and by Merchant JA, Cook TM and Missen CC. 2007. The role of information and communication technology. Bulletin of the
World Health Organization. 85(12); 970.
According to these authors, what are the major impediments to the introduction and extension of health informatics systems in developed and Third World countries?
19.15 Readings and references
Readings
Chandrasekhar CP, Ghosh J. 2001. Information and communication technologies and health in low income countries: the potential and the constraints. Bulletin of the World Health
Organization, 79: 850-855.
Merchant JA, Cook TM and Missen CC. 2007. The role of information and communication technology. Bulletin of the World Health Organization. 85(12); 970.
Lesson 20 20.1 Introduction
The focus of this lesson is on the influence of ethics, values and law on health and health care. As you have already discovered in this course, there are many ways of looking at
health and health care. These include the perspectives of economics, clinical practice, politics, law and ethics. Each of these perspectives makes assumptions about what is
important in decision-making so an integrated approach is important. In this lesson you will be introduced to ethics in the field of health and in scientific research in the area as well
as how the law both influences and is influenced by ethics in this field.
20.2 Objectives
Upon completion of this lesson, you should be able to:
1. State some of the key issues raised by ethics in the field of health
2. Identify how ethics are important to health and health care
3. Identify some ethical principles that underlie approaches to health and health care
4. Identify various ethical issues that are currently being debated in the media and in the other work you are reading in this course
20.3 The distinctive nature of health care
Despite the reports we read in the media and much of the political discussion we hear, health care is not just a business driven by statistics and costs. People do not consume
health care in the same way they buy clothes, food or cars and they do not choose health care the way they choose a vacation or car. Decisions about health concern the way
in which people in a society see themselves as individuals and as societies. They are about fundamental values and beliefs related to the meaning of life and what it is to be
humane and caring. They raise questions about the meaning of illness, about quality of life, about dependence, about mortality, and about the very nature of humanity.
20.4 Changing focus of bioethics
In the lesson of this course on paradigms in health and health care and again in the lessons on health promotion, you studied how paradigms or schools of thought have shifted.
Those paradigm shifts have affected the ethics in health and health care.
Until recently ethics in health care was medical ethics. It was often about procedural ethics, such issues as informed consent for medical treatment, regulating the health
professions, appropriate protocols for research studies and drug trials, methods of triaging or deciding how to prioritize patients for treatment or maintaining confidentiality of
medical records. The ethics in medical care relied on the physician to do good (beneficence) and to do what they thought was in the best interests of the patient. Trust was placed in
the medical profession to understand the nature of good health care and to practice based on that understanding. Bioethics then focused on questions of individual care, patient
rights and professional duty.
Now it is possible to see a change in focus. While questions of individual patient benefit and individual rights to medical benefits are still important, new issues are beginning to take
on even greater urgency. Demands are increasing for access to the vast storehouse of new technologies that are available and people are recognizing that health is more than just
medical care. They are realizing it is also about such things as the environment, the workplace, income levels and so on. It has also become clear that what benefits one person may
not be of benefit to another. There are competing demands that cannot be resolved by individuals. So there is a new focus on the common good, that is, what is best for society?
Health care has become a barometer that indicates that state of the fundamental social contract of Canada and the same can be said of many countries. The arguments about who
should pay for what and what should be paid for and the various legal cases about health care, are not so much about medicine as they are about clarifying collective social values,
about what is fair and just.
20.5 Exercise #1
1.
There are many books on bio-medical ethics that you can find in the library or on the web. Find a definition of beneficence and nonmaleficence and give the definition
and the source of your definition.
20.6 The search for ethics
A number of reasons have been suggested for why there has been an increase in the public interest in health care policy and in health care ethics. People now want to understand
and participate in the debates about such issues as:
o how science is defining human beings (e.g. think about the debate about human cloning);
o who is going to have access to the new technology (e.g. think about the debate around in-vitro fertilization) and
o how medical treatment will be given priority (think of the current debates about whether everyone should be entitled to an organ transplant and what kind of equipment
hospitals buy to detect disease).
Some of the changes in social context that have led to the search for ethics are:
o the move towards greater individualism in society generally and the increasing secularization, diversity and multi-cultural nature of society so that identifying shared norms
and values is less easy
o the effects of the unprecedented powers given by new science and technology and the impact of the suggestion that people are their genetic make-up, making people
conclude that life is more choice than chance
o the emergence of a market place approach to values in which some argue that no limits should be placed on the pursuit of knowledge because supply and demand will ensure
that the knowledge is used ethically (and unethical uses will not be commercially viable)
o the economic pressures on the provision of health that have led to competing pressures, and
o the increased use of law in resolving disputes.
20.7 Exercise #2
1. What do you think has made decisions in health care more complex than they used to be? Give a specific example of a recent public discussion about competing demands in
health policy and explain the competing demands.
2. Go to the Assisted Human Reproduction glossary compiled by Health Canada. It gives a definition of cloning. Do you think that cloning will improve the human race as some
people argue? Or do you think that it might lead to inequalities between those who are considered genetically better than others as some people have argued. Give two
arguments for and two arguments against the cloning of humans.
20.8 Values and ethics Values are long-lasting beliefs about preferable behaviours and goals. There are a number of ways of viewing the relationship about values and ethics.
Margaret Somerville in her book, The Ethical Canary: Science, Society and the Human Spirit, says that one way to view the search for ethics “… is as the search for societal values in a
secular democracy” (Somerville, M.A. (2000) p. 5). In the same book she has said that: “Health care is an ethics laboratory for societies like Canada” (Somerville, M.A. (2000) p.4).
An article by Dr Nuala Patricia Kenny called, “Dilemmas in the Current Health Care Environment”, in which she says that “…ethics [is] a discipline of philosophy which helps us
identify, clarify and prioritize the vales at stake in decisions and actions [and that it has] become central to good decisions” (Kenny, P.K. (1999) p.111)
Some of the ethical principles or values that are important in Canada are the principle of justice, the principle of non-discrimination, the principle of diversity, and the principle of
autonomy and informed decision-making. These are principles that can provide a way of thinking about an issue and a way of making sure that the things we value in society are
maintained in the ethical decisions we take. They provide a framework or a lens through which to view and evaluate diverse and complex technologies and developments in
research, including human gene research. They also suggest that everyone needs to be involved in making decisions that affect ourselves and how we live in society.
Some of the ethical concepts that people use to decide how they will make decisions are:
o Autonomy: the promotion of self-determination and the freedom of people to choose their own direction;
o Beneficence: promoting good for others
o Nonmaleficence: avoiding doing harm, including refraining from actions that risk hurting others
o Justice or fairness: providing equality for all people
20.9 Exercise #3
1. Do you think that the courts are the best place to be deciding social values and ethics? Do you think there are other places where the balancing of rights could be determined
fairly? If so, what are they?
20.10 Current ethical dilemmas
There are many interests in the ethical debates that are taking place now. In an area such as genetic screening, for example, the following will all have a perspective: policy analysts,
genetic counselors, genetic scientists and researchers, ethicists, members of the legal profession, religious leaders, disability rights advocates and other groups vulnerable to the
impacts, business and commerce, and, of course, the general public. Each is likely to define the issue in a very different way and use a different measure of what is fair and just.
The economist wants to know if it is affordable. The ethicist will want to know if it corresponds to our values and which ethical principles will guide the development and use of the
knowledge. The person with a disability wants to know if the knowledge will be used as genetic determinism and to be assured that there will not be genetic discrimination in
insurance, in health care, in employment and in social attitudes. Women will want to know if they will all have equal access to the technology and whether they can make their
own choices about any information that is found. Genetic scientists are interested in the knowledge of the genetic code and the discovering the keys to human biological structure
and function. Commercial interests will look at how to make profits from their investment in the knowledge revolution and will look at venture capital investments. The lawyer
will find him or herself involved in cases relating to wrongful birth and wrongful conception, about informed consent to screening and privacy and confidentiality. The genetic
counsellor will concern her or himself with calculating risk-benefits for individual patients and providing expert guidance on how to interpret the knowledge gained. As you can
see, it is a complicated area.
There are vast arrays of similar issues that come with the recent scientific developments.
20.11 Exercise #4
One group of people that has a dilemma with the research and the technology that is being developed in human genetics are people with
disabilities. They think that many people may use the technology, such as genetic screening, to eliminate foetuses that show abnormal genetic structures. They argue that this
would be as discriminatory and unjust as to screen out babies based on gender. Read the extract below from the 2000 position statement on the new human genetics of the
European contingent of Disabled Persons’ International (DPI). (DPI is an international human rights organization committed to the protection of disabled people's rights.)
Human genetics poses a threat to us because while cures and palliatives are promised, what is actually being offered are genetic tests for characteristics perceived as undesirable....
[O]ur perceived value and role as well as our human rights are continually diminished by the questionable medical ideas and discriminatory attitudes spawned by the new
genetics....
We repudiate the utilitarian ideology which informs much of the new human genetics, particularly the assumption that society would be better off without the inconvenience and
expense of disabled people. In contrast, we want to see all clinical practice based on strong principles of justice, ethics and non-discrimination with a respect for diversity,
autonomy and fully informed choice.
The DPI statement includes a list of 10 demands about the future of the new human genetics. These include strict regulation of human genetic techniques; non-directive, rightsbased genetic counselling; support for all children and celebration of human diversity; representation of disabled peoples on all human genetics advisory and regulatory bodies;
and protection of disabled people from discrimination and violation through medical intervention. (The full text of the DPI statement is here.)
1. What particular ethical position does this international non-government organization that has mandate to promote the rights of disabled people, take on human genetics? Can
you think of other groups who might be similarly concerned?
2. Do you think it is ethical to screen for fetal abnormalities such as Down Syndrome? Cystic Fibrosis? Criminal tendencies? Eye colour? Gender? Explain why you say yes or no to
each of these.
20.12 Ethics and economics
money for what?”
“Is there enough money?” is a question often raised about health and health care. The second question that is less often asked: “Is there enough
In any society, the people pay for what they value. Therefore the issue is about what individuals and society value. But that then leads to 2 more important questions:
· How will the priorities be determined? and
· Who gets to sit at the decision table?
These are significant questions particularly when we recognize that health is very important to people but they define differently what they think are the priorities and how those
priorities will be decided.
20.13 New reproductive technologies
In many ways, health care has become a barometer that indicates the state of the fundamental social contract in our society.
Clarifying collective social values in this area is complicated because of recent trends:
o The accelerating pace of innovation in medical technology and the rising costs that innovation brings. As possibilities grow, the ability to fulfill them all diminishes and
arguments over resources become more likely.
o Another problem is the new found knowledge of genomics. The interventions that this makes possible are seen as therapeutic by some and as eugenics by to others. Easily
available genetic information is already being used as a basis for the allocation of resources. In the United States, for example, there have been a number of legal cases in
which medical insurance was refused for babies with genetic anomalies that the mother was aware of before birth.
o Patient awareness has increased. Health care consumers who were once thought of as uninformed and pliable are now knowledgeable and demanding. They read of the latest
technology and want these new treatments for themselves.
As you have already read, some groups such as those with disabilities are particularly wary of the way this technology will be used. Women have also expressed concerns. The
federal government of Canada has passed legislation to regulate the use of this knowledge, and in 2006, created an agency (Assisted Human Reproduction Canada) responsible for
protecting and promoting the health, safety, dignity and rights of Canadians who use or are born of assisted human reproduction technologies.
The government and the agency are attempting to balance the rights of individuals with the values of society. Through legislation they are attempting to balance the rights of the
individual with the interests of society and determining which should take priority.
20.14 Ethics in the health care system
There are a number of issues relating to the health care system itself that are raising ethical dilemmas. In particular there are issues around whether everyone is treated equally and
fairly in terms of treatment. There are issues around whether the allocation of resources including how money is spent, who gets what treatment, what services are available to
everyone and which are restricted, and health inequalities and inequities (between the rich and poor, between disabled and non-disabled, between races etc).
Read Chapter 4 in the textbook, Staying Alive.
Direct-to-Consumer
Consultation Workshop
SUBMISSION - WORKING GROUP ON WOMEN AND HEALTH PROTECTION
Prepared by the Working Group on Women and Health Protection
Advertising
(DTCA)
Direct-to-consumer advertising of prescription drugs
The Working Group on Women and Health Protection is a national coalition of women's health groups, public interest organizations, researchers, journalists and health
professionals working on women's health issues, which formed in September 1998 to discuss the proposed changes to Canada's health protection legislation.
The aim of this working group is to jointly develop policy recommendations on proposed changes to Canada's Health Protection Legislation which will promote greater gender
equality, improve on existing safeguards to protect women's health, and ensure a greater voice for women in decision-making and policy development.
We welcome Health Canada's recent adoption of a Women's Health Strategy in March 1999, as a first step towards practical implementation of the recommendations on health in
the Beijing Platform for Action, to which Canada is a signatory.
The Beijing Platform for Action calls on national governments to:"Take all appropriate measures to eliminate harmful, medically unnecessary or coercive medical interventions, as
well as inappropriate medicalisation and over-medication of women."
This is especially relevant to the current discussion on direct-to-consumer (DTC) advertising of prescription drugs in Canada.
Given the heavy emphasis on drugs for healthy women in US DTC advertising, the proposal to allow DTC advertising is a concern not only for the Canadian public as a whole, but also
very specifically for women. The US has seen extensive public advertising campaigns for products such as estrogen therapies for menopause, bisphosphates to prevent
osteoporosis, and classes of drugs in which over-prescribing to women has been identified as a problem, such as tranquillisers and antidepressants. As the primary care providers
in the home, women are also the target audience for ads for a wide range of drugs used by all family members.
The box on the next page lists a few examples of DTC ads found to be in violation of US FDA regulations last year, including drugs promoted to women. Box 1: Education for the US
public - of a special kind Examples of 1998 and 1999 violations. Reported in: Drug concerns get F.D.A. reprimands over advertising, by Robert Pear. New York Times, March 28,
1999
In TV commercials for the menopausal hormone treatment Premarin, "multiple distracting visual images and activity occur during the audio presentation of the risk information" but
the benefits were described clearly, against a visual background without any distractions. The US FDA asked Wyeth-Ayerst to stop running this and certain other advertisements
because of the "broad and ambiguous health claims" made about Premarin, promising benefits that had "yet to be substantiated". In other words the FDA found that they were
making claims without the evidence to back them.
In an ad for the birth control injection Depo Provera, the risk information was jumbled in the visual and audio parts of a TV commercial to such an extent that the FDA judged that
these messages, "virtually insure that consumers will have trouble fully comprehending the information."
Bristol-Myers Squibb used women athletes in advertisements promoting the use of its drug Pravachol to reduce the risk of heart attack. The FDA judged this to be misleading
because Pravachol's use to protect against heart attacks had never been tested in women.
The FDA judged an ad for a cholesterol lowering drug, Lescol, overstated the drug's benefits and did not acknowledge that it could cause liver problems. The FDA judged this to be
"false, misleading, unbalanced and incomplete information to consumers." Novartis, the manufacturer, was also found to have nusled consumers by suggesting that this drug cost
less than other cholesterol-lowering medicines, when "Lescol may cost more."
The FDA objected to an advertisement for Caverject, an alternative to Viagra for impotence, because the manufacturer, Pharmacia & Upjohn, omitted the fact that Caverject must
be injected into the penis. Merck & Co. exaggerated the effectiveness of its anti-baldness drug Propecia, suggesting it was guaranteed to prevent hair loss in men, according to the
F.D.A. An ad in Time Magazine showed a man looking anxiously into the mrrror and said, "Starting today, you need not face the fear of more hair loss." Propecia can slow hair loss,
but it does not necessarily stop the process of balding or prevent hair from falling out.
In a recent ad in Time magazine, Glaxo-Wellcome did not mention the common side effects of its herpes drug, Valtrex, and used such small type to say that "there is no cure for
genital herpes" that this statement would have been easy to miss.
Manufacturers of three drugs for allergy that are widely advertised, Allegra, Claritin, and Zyrtec, were all found to have made unsubstantiated claims that their product was the best
of the three drugs.
According to IMS Health, a pharmaceutical market research company, the top ten drugs by DTC advertising budget in the US in 1998 included three allergy drugs, two cholesterol
lowering drugs, one drug for baldness, one for osteoporosis prevention, two antidepressants (one of which is marketed for smoking cessation) and one drug for stomach ulcers.
The industry argues that DTC advertising gets drugs to consumers faster, thus preventing much more expensive hospitalization and progression to more serious illness. As one wry
commentator put it, "If consumers don't get to see the ads, they'll end up in hospital with terminal baldness.
Why worry about DTC advertising?
Prescription drugs differ from other consumer goods because of their potential harmful as well as potential beneficial effects, the seriousness of many health conditions requiring
prescriptions, and the extra vulnerability of people who are ill and are seeking care. DTCA also differs from other forms of advertising in that a person cannot simply go out and
buy the product, they must go to their doctor first to ask for a prescription.
The aim of advertising is to increase product sales. If the industry is successful in advertising its drugs to the public, this means more visits to the doctor to request drugs, more
people using prescription drugs and more prescriptions per person. The massive growth in spending on DTC advertising in the US, from US $55 million in 1991 to more than US
$1.2 billion last year, indicates that this form of advertising is likely to be paying off. As was mentioned above, because of the potentially large audience, DTC advertising tends to
concentrate on drugs for healthy people, such as disease prevention drugs, contraceptives and hormones. It also tends to concentrate on newer drugs because aggressive
promotion soon after a drug's launch helps a company to maximize the returns on investment in drug development.
Newer is not necessarily better To market a new drug in Canada, a manufacturer needs to show that it has the desired effect (i.e. is better than placebo for a specific use), that it is
acceptably safe and that product manufacturing is adequate. From 1991 to 1997, 577 new patented drugs were marketed in Canada. Of these, only 50, or 8.7%, were thought to
be either breakthrough drugs or substantial improvements over existing treatments. Of the rest, 287 or 49.7% were "line extensions", new dosage forms or other modifications of
existing products, and 240 or 41.6% offered moderate, little, or no therapeutic improvement.
Beyond their usual higher cost, one worry about advertising aiming to convince the public to take recently launched drugs, as opposed to established therapies, is that so little is
known about drug safety when a drug first comes to market. Usually 2000 to 3000 people have taken the drug in pre-marketing studies. Any harmfiil effect occuring in less than
about 1 in 800 people has little to no chance of being discovered. Many serious harmfiil drug effects occur less commonly than this. If a new drug is heavily advertised soon after
its launch, it may be taken by hundreds of thousands of people in a very short time. The US General Accounting Office reviewed post-approval risks of new drugs approved
between 1976 and 1985.1 Fifty-one percent of the drugs were found to have serious adverse effects not detected before approval. This was the ease for one of the first drugs to
be heavily advertised to the public in the US in the early 1980's, benoxaprofen (Oraflex), an anti-arthritis drug. It was withdrawn only five months after its US launch in 1982,
following reports of severe reactions, including deaths. The US FDA called a moratorium on DTC advertising soon after, which was lifted in 1985 following public and stakeholder
consultations.
Too recent a history of widespread unnecessary harm
DES Action Canada is one of the member groups of the Working Group on Women and Health Protection. DES (diethyistilbestrol) is a synthetic estrogen that was widely used in
pregnancy from 1941 to 1971. As early as 1953 it was found to be ineffective in preventing miscarriage and premature labour, the main reasons for its use in pregnancy.
Promotion for this indication continued long after well-designed scientific studies showed that this drug was not effective. DES was also widely promoted, "for routine prophylaxis
of all pregnancies"… with claims that it helped produce… "bigger and stronger babies, too." In 1971 DES was found to cause a rare form of vaginal cancer among women exposed
before birth. It has since been linked to malformations of the reproductive organs in both women and men, and pregnancy and fertility problems.
An estimated 200,000 to 400,000 Canadian women took this drug in pregnancy. The US National Cancer Institute estimates that 4.8 million women were prescribed DES in the US.
Another member group is Breast Cancer Action Montreal. Breast cancer is a disease that could benefit greatly from improvements in treatment; it still kills many Canadian women.
Breast Cancer Action was formed by women who have been diagnosed with breast cancer, and provides information, support and advocacy for better health services.
A representative of Breast Cancer Action travelled to Washington DC last year for public hearings on whether the US FDA should approve tamoxifen to prevent breast cancer, a use
that has not been approved in Canada. Tamoxifen is an effective breast cancer treatment. However, the organization disagrees with the approval of its use to prevent breast
cancer, given the contradictory evidence on whether it is effective, the fact that most "high risk" women given the drug would never develop breast cancer anyway without it, and
the real possibility of harm. This drug increases the risk of endometrial cancer and development of blood clots that are fatal if they travel to the lung. The FDA approved the drug
for "reduction in the incidence of breast cancer" rather than prevention because not enough evidence was in to know whether the drug really prevented breast cancer.
As the enclosed ad shows, however, the manufacturer is encouraging all women over 35 to go to their doctor to find out their risk status and take the drug if they are high risk. The
ad doesn't list the risk criteria, adding to the underlying message that all women should be anxious about breast cancer and that taking a drug can allay that anxiety. The WHO
Ethical Criteria specifically state that "language which brings about fear and distress should not be used." Women harmed by the Meme breast implant also participate in the
Working Group. They charge that these implants were not properly tested before marketing in Canada and were withdrawn after being found to be defective. Had they been
widely promoted to the public as well as to doctors soon after their launch, who knows how many more women would have been harmed?
A large urban women's health clinic is another member of the Working Group. One of their concerns is that direct-to-consumer advertising will encourage many older women to
request bone mineral density scans and new drugs for osteoporosis prevention, when bone density has been found to be a very poor predictor of fracture risk and drugs to
prevent osteoporosis are of questionable value for many postmenopausal women.
"Direct-to-doctor" and "indirect-to-consumer" promotion: a poor track record The aims of the Working Group are to ensure that any changes to health legislation and to the
administration of health services in Canada help to ensure a high degree of consumer protection, transparency and accountability in decision-making. Regulation of drug
promotion is one area where Canada falls short, with lax enforcement that depends largely on industry self-regulation by the Pharmaceutical Manufacturers Association of
Canada (PMAC), or, in the case of published advertisements, on the Pharmaceutical Advertising Advisory Board (PAAB), whose members include both the advertising and
pharmaceutical industries, creating a fundamental conflict of interest.
Neither PMAC nor PAAB publishes information on committee deliberations or on code breaches in enough detail for the public or health professionals to be able to find out if an ad
they saw or an event they participated in was found to violate regulatory guidelines. In contrast, detailed information on violations is published regularly in countries such as
France and the United States that have direct government regulation of drug promotion.
Section 9(1) of the Food and Drugs Act, states that:
 "No person shall label, package, treat, process, sell or advertise any drug in a manner that is false, misleading or deceptive or is likely to create an erroneous
impression regarding its composition, merit or safety." The principle is sound, but it needs to be enforced, with active monitoring, effective sanctions and corrective
actions for violations, and full public accountability in decision-making.
 At an international level, Canada has supported the World Health Organization (WHO)'s efforts to contribute to better regulation of drug promotion. WHO's Ethical
Criteria for Medicinal Drug Promotion, ratified by the 1988 World Health Assembly, aims to ensure that drug promotion is in keeping with national health priorities
and principles of rational drug use. At successive World Health Assemblies, Canada has supported resolutions calling on national governments to implement
effective regulation of drug promotion, based on the WHO Ethical Criteria. This is sorely needed in Canada.
 In both its regulatory standards governing promotion to doctors and in transparency and accountability in decision-making, Canada falls short of the US, which relies
on direct regulation of all forms of drug promotion by the FDA. DTC advertising is unlikely to be the same in Canada as it has been in the US. Given our lack of
adequate regulation, it will probably be worse.
 We should not be talking about further deregulation of drug promotion in Canada to allow DTC advertising of prescription drugs, but how we can make sure that the
legislation we have is properly enforced. This should include a more thorough look at indirect advertising aimed at the public than is contained in the 1996
Therapeutic Products Programme policy paper on the distinction between advertising and other activities. The emphasis in this policy is on assisting "manufacturers
and associated third parties in the dissemination of non-promotional information about drugs that will not be subject to legislation pertaining to drug advertising." If
the aim is public safety and protection from deception and fraud, it is crucial that all communications from manufacturers about their products, whether they are
carried out directly or through associated third parties, are subject to section 9 (1) of the Food and Drugs Act.
Advertising by any other name is still advertising
Two features distinguish advertising: its aims and who produces it. The aim of advertising is to increase product sales. It is produced by or on behalf of a company that stands to gain
financially from an increased volume of product sales. One of the key principles of the WHO Ethical Criteria is that promotion should not be designed so as to disguise its real
nature, for example as educational or scientific activities. Deregulation of drug promotion should similarly not be disguised as an educational initiative.
RECOMMENDATIONS:
 Direct-to-consumer advertisements of prescription drugs should not be allowed, given the lack of evidence of health benefits and the serious potential for harm.
 Regulation of drug promotion in Canada is a public responsibility and should not be left to industry self-regulation. It should be carried out dfrectly by Health Canada
or by a legislated independent body, at arm's length from both the pharmaceutical and advertising industries, with the legislated authority to actively monitor and
enforce compliance, including sanctions and corrective actions, and with full procedures in place for public reporting and for transparency and accountability of
decision-making.
 The public needs access to up-to-date, accurate, comprehensive and unbiased information on the pros and cons of all treatment options, both drug and non-drug, as
well as the option not to treat, for the health conditions and illnesses they face. People need access to this information as a part of necessary public health services.
(Box 2 lists the guiding principles of the UK National Health Service's initiative to integrate patient information into publicly provided health services.) To ensure lack
of bias, information providers should have no financial links to product manufacturers or the health industries.
 Information materials and activities produced by organizations with financial backing from pharmaceutical companies about those companies or their "competitors"
products should be subject to the same regulations as advertising directly produced by the sponsoring company.
 Given the problem of unnecessary medicalization faced by women, such as having a stage of life defined as a "deficiency state" or a "disease risk" needing drug
treatment, and the widespread overprescribing of psychotropic drugs to women, regulation of drug promotion should include representation by women's
organizations and explicit attention to gender equity. Promotional messages for health professionals that contribute to further gender inequality, target women for
treatment inappropriately, or foster a disrespectful attitude towards women patients should be prohibited.
The Working Group on Women and Health Protection is a growing coalition of women's health, consumer, and public interest organizations, as well as academic researchers
working on women's health issues. The Working Group first formed as a coalition following a consultative meeting on "Proposed Changes to Canada's Health Protection
Legislation - Women's Health and Responsible Regulation," held in Toronto, September 12-13, 1998.
Representatives from the following organizations participated in the September meeting:
 the Alliance for Public Accountability,
 the Winnipeg Women's Health Clinic,
 Breast Cancer Action Montreal,
 the Consumers Association of Canada,
 the Breast Cancer Prevention Coalition,
 DES Action Canada
 the Canadian Health Coalition,
 Health Action International,
 the Canadian Women's Health Network,
 the Medical Reform Group of Ontario,
 the National Network on Environments and Women's Health,
 the World Alliance on Breastfeeding Action,
 the Women's Network on Health and the Environment,
Since September, the Working Group also includes participation from organizations of women harmed by breast implants, women with HIVIAIDS, the national Centres of
Excellence for Women's Health, and a provincial rural women's health network.
The Working Group on Women and Health Protection is currently funded by the Women's Bureau of Health Canada, the National Network on Environment and Women's
Health; DES Action Canada also contributed to the first meeting of this coalition. Member groups are funded separately. Neither this coalition nor its member groups has any
financial links to the pharmaceutical or advertising industries.
Box 2: General Principles for giving information to patients, UK National Health Service (Reproduced in: Entwistle et al. International Journal for Quality in Health Care 1996; 8(5):
428)
Information should be up to date, timely, accurate and consistent, and if possible, based on evaluated research with professionals and users involved in its development and
evaluation.
Information should be accessible to all patients, in accordance with their information needs and ability to comprehend (i.e. it must be free, attractively presented and in
appropriate language format).
Information should be integrated into a planned programme for shared decision making with feedback from patients and professionals used to refine the information and
materia1s.
Patients should be able to control how much information they are given at any one time and be enabled by the health care team to understand the information they are given.
Information must be presented in a way that ensures confidentiality - (with the exception of special circumstances) a patient's explicit consent should be given before disclosure
of information to relatives and carers.
Information should include all available treatments or management options, including non-intervention, with comprehensive and unbiased information about outcomes (risk and
benefit) based on a systematic review of research evidence, noting uncertainties and gaps in scientific knowledge.
Reality Check: A few Myths about DTC Advertising
Myth:Direct-to-consumer advertising of prescription drugs helps to empower consumers, enabling them to participate in informed decisions about their health care with their
doctors.
Reality Check:"The problem is that inherently those ads are misleading, not because of the adverse safety profile but because one comes away with the idea that the drug works in
every instance."
-
David Kessler, ex FDA Commissioner, on television ads; Quoted in: TV DTC advertising soars in the US. Scrip 1998, June 10; 2342:15.
To participate in informed decisions about care, people need full, unbiased, accurate information about the pros and cons of all treatment choices, both drug and non -drug, as
well as the option not to treat, where it is appropriate. They need an overview of what can be done for their condition, what they can expect, both good and bad, and help with
decision-making. If they're making a decision about a prescription drug, they are dealing with a potentially toxic substance and often with a serious health condition. This is why
it is important to have both the advice of a health professional and additional information sources. Advertising aims to sell a product. It will always present the product in as
positive a light as possible. It will never fulfill the function of telling consumers they really don't need to take the advertised product, they'll get better anyway on their own. It
will never tell them that in fact a competitor's products are superior. We can never expect these things from advertising. No one expects them from a car ad. Why expect them
from an ad for a medicine? We've also never seen this sort of unbiased information in any advertising of medicines to doctors.
No matter how strict the guidelines governing advertising, a company will always be tempted to present their product in as positive a light as possible, and to underplay its
negative side. Unfortunately, with advertising of medicines all too often this has translated into exaggerating benefits and downplaying risks. It might not be a problem if we
were talking about the wonders of a new perfume. However, downplaying the risks and exaggerating the benefits of a medicine can be dangerous. It can also be dangerous to
convince people they need a drug when they don't.
Myth:The type of promotional abuses we see in the US wouldn't happen here. After all, in Canada healthcare is recognized as a public responsibility, so the government has a
higher stake in making sure that advertising of medicines is ethical and contributes to the best possible use of health care resources.
Reality Check: Regulation of drug promotion is one area of healthcare where Canada falls far below the standard set in the US. This is because in the US drug promotion is directly
regulated by the FDA. In Canada, we depend on industry self-regulation. Most forms of drug promotion aimed at doctors are covered by the Pharmaceutical Manufacturing
Association of Canada (PMAC)'s Code of Marketing Practices. This includes the big budget items like sales representatives (drug detailers) who pay personal visits to doctors to
promote drugs. It also includes conferences and continuing medical education sponsored by companies. In Canada, industry sponsors are allowed to be involved in developing
the agenda for educational symposia and choosing speakers. A 1997 FDA guideline no longer allows this in the US.
Published ads are regulated by the Pharmaceutical Advertising Advisory Board (PAAB), a semi- autonomous organization. It is not run by the industry alone, but has the drug
industry on its board along with representatives of advertisers, medical media, health professionals and consumers. PAAB has an arm's length relationship to government, but
not to industry. It was set up in 1975 as a compromise by Health Minister Marc Lalonde, who had threatened to bring in direct government regulation because of concerns
about the inadequacy of industry self-regulation. PAAB pre-screens published ads, which is a positive feature as it can prevent problem ads from ever reaching the press.
However, if pre-screening is based on weak standards and/or does not adequately enforce code standards, it does not effectively prevent misrepresentation of a product's
benefits and risks.
The ad for Evista (raloxifene) included in this package was pre-screened by PAAB but it promotes the drug for unapproved uses. Evista has not been approved to prevent breast
cancer, to protect against heart disease, or to relieve symptoms of menopause. It has only been approved to prevent osteoporosis. The information on fracture prevention is
extremely misleading. Although it refers only to evidence about symptomless fractures that were visible on x-ray, this is not mentioned.To date, there is no evidence that Evista
has any effect on fractures that women could feel. Many symptomless spine fractures cause no problems at all for the rest of a person's life. This is very different from a drug
that prevents a woman from breaking a hip or from pain and disability.The information on fracture prevention is also based on "pooled treatment groups" including some
women taking twice the recommended dose.
Is there fair balance of benefit and risk information? This ad fails to mention that Evista can cause deep vein thrombosis, blood clots that usually form in the leg, but can also travel
to the lungs and be fatal, in about 3 in 1000 women who use it. The ad also fails to mention that in animal studies, Evista caused cancer of the ovaries. If PAAB thought this ad
was OK, clearly anything goes.
Another ad included in this package, for the antidepressant Effexor (venlafaxine), misleadingly represents the drug's benefits. The headline and quote imply that the drug is a
beffer treatment for depression than competitors because of its action on two types of neurotransmitters. This is a fine idea in theory, but the proof is in the pudding -- or in
this case, in the clinical studies of how well the drug works. It has not been shown to be more effective than other antidepressants that affect only one neurotransmitter, yet
PAAB pre-screened and accepted this ad.
Ultimately, the Food and Drugs Act states that advertising should not be deceptive or misleading, and empowers the Health Protection Branch to stop advertising that causes risks
to the health of Canadians; the HPB can also force a company to change unethical marketing practices. Both the PMAC and PAAB codes are voluntary.
In Canada: There is no active monitoring of most forms of drug promotion. No one is watching companies to make sure they promote their products ethically to doctors,
pharmacists or other health professionals; pre-screening of ads is a positive feature, but unfortunately is based on a low standard for balance of product benefit and risk
information, accuracy of claims, and the scientific evidence used to back claims;
If a company is found to violate the PMAC code, it is fined. A bigger fine accompanies each violation within a twelve-month period. Then, amazingly, the company is granted a
clean slate at the beginning of the next year. For a large multinational, even the highest possible fine levied by PMAC - $20,000 - does not represent an effective disincentive.
Companies might easily be tempted to see such fines as "the price of doing business" especially if they can increase their sales dramatically by stretching the truth a little. The
public, doctors, pharmacists and other health professionals can't find out if an ad or a promotional activity was found to be misleading or inaccurate. This keeps people from
knowing if they've been duped. It also stops them from getting a clear idea of what is and is not acceptable practice. This type of information on US violations is available from
the FDA, and much of it is published on their web site.
Self-regulation of drug promotion does not work. We should not be talking about deregulating further in Canada, we should be talking about what kind of changes we could make
to our current system to bring regulation of drug promotion in line with health priorities.
To quote David Kessler, ex-Commissioner of the US Food and Drug Administration:
"Once a new drug has been approved, a company is under intense pressure to promote it as vigorously as possible. There's a risk that patients who don't need it will be exposed.
That's why the role ofthe F.D.A. is critical." (Drug concerns get F.D.A. reprimands over advertising, by Robert Pear. New York Times, Sunday, March 28, 1999)
Myth:It is paternalistic to ban direct-to-consumer advertising because such a ban assumes people can't decide for themselves whether to trust the information they see in ads. It
also assumes that doctors know best.
Reality Check:There is no reason to believe that the general public is less likely to be duped by misleading advertising of medicines than doctors. After all, doctors should have
learned principles of rational prescribing during their medical training. They should know to use greater caution in prescribing most new drugs because when a drug is first put
on the market, it has been taken by too few people and for too short a time to know much of anything about rare harmful effects or long-term effects. They should know not to
prescribe antibiotics to people who have colds and the flu or other viral infections. To minimize resistance to new drugs, doctors should also be careful not to prescribe
powerful new antibiotics for initial treatment of common bacterial infections that are likely to respond to older antibiotics.
Studies of how appropriately a doctor prescribes consistently show that doctors who rely most heavily on drug promotion as an information source prescribe less appropriately.
Prescribing appropriateness is measured in these studies as: whether a drug was prescribed for a condition it is meant to treat; whether the right dose was used; whether
unnecessarily harmful drugs were avoided; and whether the least expensive of equivalent drugs was prescribed.
Doctors are not making a decision about their own health care; they are providing treatment advice to patients. The way many doctors prescribe drugs could be much improved,
and in several provinces medical educators and health service providers have developed projects to improve prescribing.
Are advertisements to patients likely to improve doctors' prescribing? This seems unlikely, given what is known about promotional influences on doctors and the quality of their
prescribing.
A medicine used in the right way by the right person for the right condition can be a powerful cure or provide comfort that was otherwise unattainable. The same medicine - used
in the wrong circumstances or in the wrong way - can be at best useless and at worst life-threatening.
The aim of DTC advertising of prescription drugs is to increase sales. No fluff about education or empowerment can hide this basic fact. Even the industry does not deny this aim;
they simply say that more drugs translate to better health. These calculations, like the slick presentations in advertising materials, tend to emphasize the benefits of medicines
and forget to count their risks. Harmful effects of medicines (ADRs) are estimated to cause around 100,000 deaths per year in the US. (Lazarou et al. JAMA 1998; 279:12001205) At a similar rate, this translates to 9,000 to 10,000 deaths per year in Canada. ADRs were estimated to cause 1.5 million people in the US to be so seriously injured in 1994
that they were hospitalized or needed to prolong their hospital stay. It isn't hard to figure out that if more drugs are sold, more people will use them and the risk of harmful
drug reactions - including deaths, disability and serious injury - will increase.
For a real lesson in paternalism towards women, check out a few US DTC ads for menopausal women. (See attached example) Forget menopause? The underlying message is that
there is something wrong with being 50'ish and a woman, and she'd better use drug treatment to cure herself of this terrible affliction.
Myth:We can develop a compromise solution to introducing DTCA in Canada. Instead of having direct ads, produced by a company, we can have joint educational efforts involving
the industty and non-profit groups to produce educational advertisements.
This will be a win-win situation, satisfying the industry's needs to expand their markets, helping non-profit groups to gain a higher profile and financial security, and maintain an
emphasis on education, meeting the needs of the Canadian public.
Reality Check: An ad is an ad is an ad, no matter what it's called. Either we allow the industry to advertise to the public in Canada or we don't. If a company is advertising a
product, working with a non-profit to produce "educational materials" as part of an advertising campaign won't stop the company's aims from being to increase sales. It would
be unrealistic to expect anything else from a manufacturer who must after all survive within a competitive marketplace. It may make it more difficult for the public to recognize
the materials as advertising, however.
If all treatments must be mentioned, is the sponsoring company going to agree to pay for something that says its product usually shouldnt be used, its product is not as good as a
competitor's or is more expensive but hasnt been found to work any better?
A non-profit group which receives funding from a company to produce advertising/educational materials together with that company is not in an equal position or able to fully
control the content of those materials. It is financially dependent on the company, both for current and future funding. This type of relationship creates a fundamental conflict
of interest.
"Because patient associations are so intent on gathering and passing on information about drugs under development, they have become useful vehicles for pharmaceutical
companies for disseminating information about new medicines at the pre-launch stage."
- Sean Milmo, journalist writing in a pharmaceutical industry trade magazine, A matter of patients, Pharmaceutical Visions 1996; 5(1):68-72.
"What companies would do and I was actually part of the process, is create a demand for a product before it was actually released. We went around to various communities and
organized public health education seminars on migraines and that topic was really popular. ..seminars that we actually charged five dollars for, another marketing tactic that
makes the patient think that this thing isn't being funded by a major pharmaceutical company. We held these seminars right across Canada."
- John Martens, ex Glaxo employee. In: Mintzes B. Blurring the Boundanes: New Trends in Drug Promotion. Amsterdam: HAI, 1998
"…researchers believe it helps to prevent heart disease; and it may provide protection against colon cancer, Alzheimer's disease and stroke… On the other hand, questions remain
about the link between hormone therapy and breast cancer, largely due to inconsistent research results."
The TSX Gives a Short Course in Health Economics: It's the Prices, Stupid!
Abstract
The fall in Shoppers Drug Mart shares last April 8 gave a crystal-clear demonstration of the link between health expenditures and health incomes. Reacting (finally) to the
excessive retail prices of generic drugs, the Ontario government effectively halved the rate of reimbursement of ingredient costs and banned the “professional allowances”
(kickbacks) paid to pharmacies by generic manufacturers. Taxpayers and private payers will save hundreds of millions of dollars, and pharmacy revenues will fall by an
equivalent amount. Patients will still get their drugs, with no loss of quantity, quality or even convenience; no one's health is threatened. But investor profits will fall. There are
similar savings opportunities throughout the health system. Health costs are primarily a political, not an economic, problem.
Wednesday, April 7, 2010. The shares of Shoppers Drug Mart (SC-T) closed on the Toronto Stock Exchange at just under $44. The next morning they were trading below $37.
Nearly a fifth of the company's market value, about $1.6 billion, had vanished literally overnight. It got worse. On June 29, Shoppers bottomed at $32.57 a share. The company
had lost a quarter of its market value since the evening of April 7. (Shoppers has since recovered somewhat; on October 1, it closed at $38.82.)
Go to:
Lesson One: Every dollar of expenditure on health services (or anything else) is a dollar of someone's income.
There is no mystery about where the money went. The Minister of Health of Ontario announced, on that Wednesday evening, that as of July 1 the Ontario Drug Benefit (ODB) Plan
would change the rate at which pharmacies were reimbursed for the ingredient costs of generic drugs dispensed to beneficiaries. By June 29, it was clear that they were going
ahead as planned. Pharmacies had previously been receiving 50% of the price of the corresponding branded and originally patented drug; henceforth they would receive only
25%. At the same time, the “professional allowances” (less politely, kickbacks) paid by generic manufacturers to pharmacies would be banned. Shoppers, the largest chain
pharmacy in Canada, would see this change come straight off its bottom line — as indeed would every other pharmacy in Ontario — and the stock market reacted accordingly.
The Ontario government estimated that this change would reduce ODB outlays by about $500 million per year, or 12% of the estimated $4.1 billion that the Ontario government
spent on drugs in 2009 (CIHI 2009). But private payers in Ontario, both insurers and individual patients, spent another $7.6 billion, and as of April 1, 2012, they too will be paying
no more than 25% of the price of the originally patented drug.
Nationally, about a quarter of private spending is for non-prescription drugs and related items. So if one assumes an equivalent 12% saving on generics for private payers, that
would amount to 7.6 × 0.75 × 0.12 = $684 million. The numbers are rough, but the total savings look “not unadjacent to” $1.2 billion per year.1
That's an average of nearly $100 for every resident of Ontario. It is also an estimate of the annual revenue lost by Ontario pharmacies. The savings and the loss are opposite sides
of the same coin. And the savings/lost revenue will increase over the next few years as several high-volume “blockbuster” drugs come off patent and more generic alternatives
become available (Picard 2010; Cutler 2007). The fall in Shoppers' capitalization represents Bay Street's (rather unstable) guesstimate of the present value of its share of that
lost stream of future revenue. No wonder Jürgen Schreiber (CEO of Shoppers) was upset.
Go to:
Lesson Two: Winners and losers are always unevenly distributed.
The gainers from this policy change are Ontario taxpayers, patients and (eventually) privately insured workers and their employers. Patients benefit immediately, taxpayers will
gain as the debt burden is lessened and workers/employers will gain as, if and when, private insurance premiums fall (or rise less rapidly), leaving more cash on the table to be
divided between them.
Investors, in and out of Canada, will lose; the market has already made a preliminary calculation of their loss. Shoppers Drug Mart is a blue-chip stock, popular with mutual funds
and exchange-traded funds offering steady growth with good dividends. (It has a beta of 0.40.) These folks have had a nasty surprise. Overall, the net effect has probably been
to shift wealth down the income distribution because stock ownership is highly correlated with income and pharmaceutical use is not.
Pharmacists, qua pharmacists, will probably be little affected. The steady up-trend in prescriptions to be filled will not change, and failing significant technical changes in the
dispensing process, pharmacists will be needed to fill them. Assuming that the market for pharmacists' services is reasonably competitive, and chains like Shoppers pay no
higher wages and hire no more pharmacists than they have to (they are, after all, for-profit corporations, not charities), then pharmacists' wages and employment are unlikely
to change.2
Those pharmacists who own their own stores, however, definitely will lose — their profits will fall along with those of corporate pharmacies. They are, in a sense, their own
shareholders. But it is the return to store ownership, not the wages of pharmacists, that will fall.3 Expressions of distress by pharmacists' organizations will reflect this impact on
pharmacy owners
Lesson Three: It's the prices, stupid!
Health expenditures are driven by prices as well as quantities: E = P × Q. Q is unchanged; Ontarians are still getting their prescriptions filled. The reforms have cut the prices paid
for generic prescriptions, not the quantity provided. Pharmacies have had their profits cut but have not gone out of business, and it appears that Bay Street has significantly
reduced its June 29 estimates of the impact of the reforms. As the price cuts are extended to private payers, there could be some reduction in the numbers of pharmacy outlets,
but Ontario is heavily over-endowed with pharmacies, especially in urban areas.4 Indeed, this density is likely a consequence of the overpricing of generic drugs.
The ODB reforms do contain provisions to protect access to pharmacy services in regions with low dispensing volumes, where lower reimbursement might really threaten
patients' access to drugs, but this is a small fraction of the Ontario population. Because the vast majority of prescriptions are filled in markets densely populated with
pharmacies, there seems no good reason to let the rural tail wag the urban dog.
Shoppers initially threatened to terminate free delivery services and other benefits to patients, but this move seems questionable. Providing such services is a marketing decision,
not an act of charity. If they add to profits, they continue. If not, well, the pharmacy can always offer these services for a price to those willing to pay.5
Lesson Four: Rising health costs are not a law of nature, like the tides. They are responsive to well-crafted policy.
This episode gives the lie to those who allege that containing health costs must necessarily impose unacceptable cuts to the quantity and/or quality of health services, threatening
Canadians' health. Such claims are the basis for the argument that universal public health insurance is “fiscally unsustainable.” They are also false.
The interests driving these claims are not difficult to discern; see Lesson One, above. But the implicit assumptions are twofold, and both are wrong. First, they assume that the
prices currently paid for health services are determined through some market or other process such that they reflect the real costs of production. Imposed reductions must
therefore result in reduced quantity or quality of services. The Ontario reform demonstrates that this is incorrect. The second assumption is that the services currently being
provided are all necessary and effective in promoting patients' health. This assumption flies in the face of a vast literature on prescribing appropriateness and clinical variations;
for the merest scratch on the surface of the latter, see Evans (2009).
Lesson Five: Cost containment is primarily a political, not an economic, problem.
The shares of Jean Coutu, the large Quebec pharmacy chain, also fell on April 8, from $10 to $9, and bottomed on June 29 at $7.88. Investors expected Quebec to follow Ontario's
lead. More generally, Ontario is only about 40% of Canada. If its reforms rolled across the country, could we be seeing national savings — pharmacy revenue losses — in the
$2—$3 billion range? The answer appears to be no, not so much, and the reasons are quite instructive.
The government of British Columbia did react, very quickly. Health Minister Kevin Falcon announced that PharmaCare would negotiate a mutually acceptable agreement with
pharmacies to reduce the reimbursement rate for generic drugs. Reductions will apply to private payers as well. But the reimbursement rate was reduced only to 35% of the
corresponding previously patented drug, phased in over three years. There would also be additional payments to pharmacists for various other services, of possible value to
patients but of clear benefit to pharmacies.
Alberta had, in fact, acted earlier to reduce payments for generic drugs, first for new generics and then, effective April 1, 2010, all generic drugs. But the cuts were from 75% to
56% of the corresponding branded product (45% for new generics), so that Albertans after their reform are still paying higher prices than the ODB was paying before July 1,
2010.
As the Alberta government's press release notes, disingenuously: “The pharmacy industry indicated it had some concerns with reductions to generic drug prices. … Government
recognizes that reducing the price of generic drugs will impact revenues of pharmacy businesses” (Alberta 2010). Well, duh! (Yet again, see Lesson One, above.)
Unlike Ontario, neither Alberta nor British Columbia eliminated kickbacks from generic manufacturers to pharmacies. And both left in place maximum dispensing fees well above
Ontario's rate of $8.50 (Alberta, $11.93; BC, $10.50). In short, while recognizing that generic drug prices were too high, both Alberta and British Columbia struck a political
compromise between the financial interests of taxpayers and private payers on the one hand, and pharmacies on the other.
There is no economic reason why governments in both Alberta and British Columbia could not have followed Ontario and gone for 25% or even less. The government of British
Columbia, in particular, seems proud that they achieved a “negotiated” rather than an imposed settlement. But pharmacies negotiated with a gun at their heads. By leaving so
much money on the table, these governments in effect bought ideological comfort and, presumably, political advantage with other people's money. (In BC, some of mine.)
Well, it isn't the first time that has happened. The point that comes through loud and clear, however, is that had they wanted to cut drug costs still further, they could easily have
done so. Both the previous and the new lower costs of generic drugs are the result of political choices, not economic forces.
Quebec is more involved. Current legislation requires the provincial government to pay no more for a drug than the lowest price available in any other province. That would force
them to match Ontario's 25%, and the government says they will. But:
This same law prohibits private plans from adopting the same control approach as the RAMQ [Quebec's health insurance plan]. Indeed, private plans are obligated to reimburse
an original drug at a minimum of 68% of the amount claimed, even if the generic drug is sold to the pharmacist at a maximum of 25% of the price of the original. (Tagsa 2010)
In effect, the government of Quebec is trimming its own costs while leaving private payers exposed to higher charges. And in Quebec, employer-based insurance is de
facto compulsory. Employers and employees are thus being milked to subsidize pharmacies — a distinctly perverse approach to cost control!
Nonetheless, pharmacy owners are said to be outraged that they were not consulted. (What, exactly, might they have said? It's a zero-sum game.) They have demanded various
forms of compensation, and have taken a page from the Big Pharma playbook. Current or planned generic production in the province will be suspended if their prices fall.
That argument makes no economic sense. Generics are an internationally traded commodity. What possible benefit would there be to Quebeckers at large from paying a
premium, directly or indirectly, for local production — and supporting the price of Jean Coutu shares?
But that is an economist talking. The political calculation is likely to be different — as it was in Alberta and British Columbia. At time of writing, the Quebec poker game was still in
session. The important point is that it is a political poker game. Whatever emerges, any suggestion that Quebeckers will pay prices for generic drugs that approximate their real
economic costs, or are determined by competitive market forces, would be incredibly naïve or simply dishonest.
Lesson Six: In the health services sector, regulation works. Markets don't.
In October 2007, the Canadian Competition Bureau released a report on generic drug prices (Canada 2008). Bay Street analysts are paid to assess the profit potential of publicly
traded corporations. They ignored the Competition Bureau report, if they noticed it at all. A small prize will be given to the reader who can find a response in Shoppers Drug
Mart share prices during October 2007.
Yet, the Bureau clearly stated that retail prices for generic drugs were too high. Competition among generic suppliers was effective in holding down prices paid by pharmacies, but
not prices charged by pharmacies; the benefits of competition were being appropriated before reaching the retail payer (and hence were capitalized in, e.g., Shoppers share
prices). The Competition Bureau's report contains thoughtful discussion of the ways in which the competitive market forces of the economic textbooks have been subverted in
this market, and hopeful suggestions as to how they might be strengthened and made more effective. The TSX apparently did not fancy their chances.6
The report ends on a rather wistful note:
Individual plan members and persons paying out of pocket can also play a key role in helping to obtain the benefits from competition by being effective shoppers. The more that
consumers compare prices and services when shopping for drugs, the more incentive the pharmacies will have to make lower prices and better services available to patients.
(Canada 2008)
Indeed. And if wishes were horses, beggars might ride. In the real world:
it is the cash-paying customer without a drug plan who typically pays the highest price for prescription drugs. Sullivan says many pharmacy computers are set up so that if a
regular pharmacy client loses their employer-paid benefits, and that information is entered on the screen, “a completely different” higher price for the prescription
automatically pops up. (Silversides 2009)
The central point is that over half of prescription drug costs (55% in 2009), generic and patented, are paid privately and always have been. Yet, this private market has not
restrained prices. Conceivably, an activist provincial government might try to restructure the drug dispensing process to create genuine market competition, but such
restructuring would have to be extensive, complex, politically costly and highly uncertain of outcome.
Why would any rational government take on such a dubious task when regulatory alternatives are ready to hand? Such a quixotic enterprise might please ideological
marketophiles and congenital economists, but the more realistic folk who decry regulation and champion “the market” in health services typically do so precisely because they
understand how little threat markets pose to existing price and income patterns.7 The Ontario government has instead chosen to cut the Gordian Knot. Its example has forced
other provinces, perhaps half-heartedly and despite ideological reservations, to follow along.
Lesson Seven (extra credit): All six of these lessons apply across the whole health system.
Prescription drugs account for only 13.9% of Canadian health spending, and generics for less than half of that. Even if provinces could pick up, for their residents, all of the $2—$3
billion in annual savings that might be on the table, that is small change compared to last year's estimated total of $183.1 billion, increasing about $10 billion a year.
But wait! There's more!
When Canada's Medicare was extended to cover physicians' services in the late 1960s, the rate of escalation of physician and hospital costs was dramatically reduced. The
universal public system both avoids the very large administrative overheads generated by private insurance (Woolhandler et al. 2003) and possesses a significant degree of
bargaining power in negotiating with providers. The sectoral price inflation endemic to private or mixed financing systems — over and above general inflation rates — is
substantially reduced. A universal pharmacare program could do the same.
But in Canada, we still finance prescription drugs on the American Plan — multiple public and private payers, very expensive and highly inequitable. Commentators have noted for
years that we incur substantially higher costs as a result. Most recently, Gagnon (2010) calculates that a true pharmacare system similar to medicare — universal, first-dollar,
tax financed, with a single public payer — could reduce total drug costs by as much as $10.7 billion per year, even assuming a 10% increase in utilization. That begins to sound
like serious money.
About $1.5 billion could be saved by eliminating most of the administrative overhead, the extra paper pushing (and the tax-expenditure subsidies) associated with private
insurance. But the big money comes from aggressive price negotiating with the pharmaceutical industry. When governments are themselves on the hook for drug costs —
directly accountable — it concentrates the political mind wonderfully. Promoting industrial policy by giving away their citizens' money to Big Pharma is likely to look less
attractive.
These savings are not imaginary; examining New Zealand's Pharmac program for drug purchasing, Morgan (in Evans et al. 2007) has calculated potential savings for Canada of a
similar magnitude. So fierce opposition to a medicare-type Pharmacare program from Big Pharma and the private insurance industry is a given. The potential savings are their
revenues — once more, see Lesson One, above.8
But there is another source of resistance. In cutting about $10 billion from Canadians' total drug bill, genuine pharmacare would also double the public share. Opposition thus
comes not only from anti-tax ideologues and assorted libertarian loonies, but also from quite clear-eyed occupants of the upper income brackets. Tax-financed pharmacare, like
medicare, would transfer some of the overall payment burden from the unhealthy and unwealthy to the healthy and wealthy. The latter are thus natural allies of Big Pharma
and the private insurers in protecting our high-cost drug financing system. And they make their dollars count, politically.
Pharmaceuticals are not the only sector where prices are out of line. Payments to physicians account for the same share of health spending ($25.6 billion in 2009) as
pharmaceuticals ($25.4 billion), and they have been on a bit of a tear lately. According to the Canadian Institute for Health Information (2009), per capita expenditures have
risen 45% in the last 10 years, after adjusting for general inflation. This increase is second only to pharmaceuticals (a whopping 74%). But in the last five years, the escalation of
payments to physicians has accelerated — 24% above inflation and population growth since 2004, compared with 16% in the previous five years — while in all other major
expenditure categories the growth, while still very significant, has slowed. (Pharmaceuticals fell from 46%, 1999—2004 to 19%, 2004—2009; hospitals are down to a mere 11%.)
These are very big numbers. If payments to physicians had merely kept pace with inflation and population growth over the last decade, our annual doctor bill would now be $7.9
billion lower. Similar restraint in prescription drugs would have saved us $11.0 billion.9
Research currently nearing completion at the Centre for Health Services and Policy Research at UBC suggests that the growth in physician expenditures is, like that of
pharmaceuticals, largely a consequence of increasing relative prices — sector-specific inflation. There is thus considerable scope for cost containment in physicians' services, as
in prescription drugs, by focusing on the prices being paid. The real problem is, as always, the political difficulty of containing the income aspirations of powerful actors on the
supply side.
The economics is, by comparison, easy.
Acknowledgements
With thanks to Michael Law for helpful comments.
Notes
1
The cut to 25% is not the whole story; there are to be a variety of other compensatory payments to pharmacies to cushion the shock. On the other hand, the proportionate
savings to private payers may be even greater than those to the ODB.
2
This prediction assumes that because the overall volume of dispensing work will not be reduced, requirements for pharmacists will not change, i.e., the average number of
prescriptions filled per pharmacist will remain constant. Conceivably, however, efforts to restore the profitability of pharmacies could lead to fewer pharmacies and higher
dispensing rates per pharmacist — reducing the demand for pharmacists. Introduction of “robo-pharmacy” could have even more dramatic effects.
3If
the option of opening one's own pharmacy enables pharmacists to bargain for higher wages than the market would otherwise provide for work of similar effort and knowledge,
then any such premium would be reduced as store ownership becomes less attractive.
4A
recent analysis of the supply and geographic distribution of pharmacies in Ontario (Law et al. 2010) shows that the majority of the population (63.6%) live within an 800-metre
walk of one or more pharmacies, and nearly all (90.7%) live within a five-kilometre driving distance. A randomly distributed cut of 20% in the number of outlets (conservative,
since closures would be more likely in pharmacy-dense areas) would have virtually no impact on these access measures.
5The
announcement by Loblaws that they were considering opening dispensaries in their stores took some of the wind out of Shoppers PR sails, though that may have been just a
shot across the bow in response to Shoppers' intrusion into the grocery market.
6
Still, the clear message, from a disinterested public agency, that Canadians were paying too much for generic drugs can only have strengthened the political position of the
Ontario government.
7There
are examples of successful cost containment through competition — New Zealand's Pharmac and Medicaid in the United States, or, for that matter, hospital or pharmacy
purchasing in Canada. But these are competitive tendering processes at wholesale, by a single buyer or a coordinated group, not a fragmented retail market. Even very large
private insurers have been remarkably ineffective, worldwide, in mobilizing their potential market power to restrain price inflation in the health sector.
8When
the United States introduced the Medicare Part D coverage of prescription drugs for the elderly, the pharmaceutical industry lobbied successfully to have the legislation
specifically prohibit the Social Security Administration from negotiating drug prices with suppliers. They were well aware of the potential impact on prices of a large public
buyer.
9
Of course, the population is also aging. Demography would account for an increase of about 5%.
How Much Is Life Worth: Cetuximab, Non–Small Cell Lung Cancer, and the $440 Billion Question
1. Tito Fojo and
2. Christine Grady
+Author Affiliations
1. Affiliations of authors: Medical Oncology Branch, Center for Cancer Research, National Cancer Institute (TF), and Department of Bioethics, The Clinical Center
(CG), National Institutes of Health, Bethesda, MD
1. Correspondence
to:
Tito Fojo, MD, PhD, Medical Oncology Branch, Center for Cancer Research, National Cancer Institute, National Institutes of Health, Bldg 10, Rm 12 N226, 9000 Rockville Pike,
Bethesda, MD 20892 (e-mail: tfojo@helix.nih.gov).
Abstract
The spiraling cost of cancer care, in particular the cost of cancer therapeutics that achieve only marginal benefits, is under increasing scrutiny. Although health-care professionals
avoid putting a value on a life, our limited resources require that society address what counts as a benefit, the extent to which cost should factor in deliberations, and who
should be involved in these decisions. Professional societies, such as the American Society of Clinical Oncology, government agencies, including the Food and Drug
Administration, and insurance companies should be involved. However, no segment of society is better qualified to address these issues than the oncology community.
Oncologists must offer clear guidance for the conduct of research, interpretation of results, and prescription of chemotherapies. We review recent drug approvals and clinical
trials and comment on their relevance to the issue of the spiraling cost of oncology therapeutics. We suggest some standards that would serve as a starting point for addressing
these issues.
The year 2008 was one with few major breakthroughs in cancer treatment. A highlight of the war on cancer at the annual meeting in 2008 of the American Society of Clinical
Oncology (ASCO) was the reporting of the results of a multi-institutional European trial in which cetuximab was added to cisplatin and vinorelbine to treat patients with non–
small cell lung cancer (NSCLC) (1). The overall survival (OS) advantage from adding cetuximab was 1.2 months (hazard ratio [HR] = 0.871, P = .04). This extra time was
accompanied by a substantially higher rate of febrile neutropenia in those receiving cetuximab, along with higher frequencies of acne-like rash, diarrhea, and infusion-related
reactions. Unfortunately, there were no systematic quality-of-life assessments reported to objectively determine the tolerability of the agent compared with conventional
treatment.
Did the results of this trial constitute a breakthrough? According to the researchers, “Cetuximab added to a platinum-based chemotherapy sets a new standard for the first-line
treatment of patients with non–small cell lung cancer” (1). And the ASCO press briefing asserted, “these findings are likely to have a significant impact on the care of patients
with these types of cancer” (2). But the only reasonable conclusion is that a magic anticancer bullet aimed at an important target missed by a wide margin. Nevertheless, the
presentation raised once again an even more pressing and important set of issues: What counts as a benefit in cancer treatment? How much should cost factor into
deliberations? Who should decide? As oncologists, we cannot go on without answering these questions. The moral character of our specialty depends on the answers.
Previous SectionNext Section
The Purported Benefits of Cancer Treatments
Unfortunately, the announcement of a 1.2-month prolongation of survival in NSCLC was not the first time cetuximab garnered attention for marginal benefits. The Food and Drug
Administration (FDA) approved cetuximab for advanced colorectal cancer after it was shown that when combined with irinotecan, it prolonged OS by 1.7 months compared
with single-agent cetuximab but not with single-agent irinotecan (3–5). Preliminary reports also indicated a marginal benefit in the front-line setting characterized by higher
response rates, with an effect on progression-free survival (PFS) of at most 0.9 months (27 days) (6–9). And this prolongation of survival occurred at the expense of skin toxicity
in as many as 85% of patients, including grades 3 and 4 toxicities in 18.7% (7), with skin toxicity likely to occur in 100% of those who benefited (10). Is an additional OS of 1.7
months a benefit regardless of costs and side effects?
Cetuximab is not alone among treatments offering marginal benefit at very high cost. The FDA approved the anti–vascular endothelial growth factor antibody bevacizumab
(Avastin) in combination with carboplatin and paclitaxel for first-line treatment of eligible patients with locally advanced, recurrent, or metastatic nonsquamous NSCLC based on
an OS increase of 2 months (11). The addition of bevacizumab to chemotherapy then became the standard of therapy for nonsquamous NSCLC, despite disagreement among
lung cancer specialists regarding the actual benefit. The authors of a recent phase III trial claimed that their “study augments a growing body of evidence that combining
bevacizumab with standard platinum-based chemotherapy provides important clinical benefits for patients with advanced nonsquamous NSCLC” (12). They concluded this after
showing that compared with placebo, the addition of either low- or high-dose bevacizumab to gemcitabine and cisplatin prolonged PFS by 0.6 months in the low-dose
bevacizumab group (median PFS = 6.7 vs 6.1 months for placebo; P = .003) and 0.4 months in the high-dose bevacizumab group (median PFS = 6.5 vs 6.1 months for placebo; P =
.03). The duration of follow-up was not sufficient for analysis of OS. However, based on past experience, this albeit statistically significant improvement of 18 and 12 days,
supported by hazard ratios for PFS of 0.75 and 0.82, may not withstand the OS test. For example, in the study in which bevacizumab was added to carboplatin and paclitaxel,
the benefits in PFS (HR = 0.66) and OS (HR = 0.79) were similar, and in another trial of bevacizumab (see below), the benefit in PFS did not translate into improved OS (13). If the
addition of bevacizumab does not improve OS, are 12–18 additional days of PFS a real benefit?
In breast cancer, the benefit of bevacizumab is even less, and probably nonexistent, even if measured in days. In combination with paclitaxel, bevacizumab was reported to
prolong PFS by a statistically significant extent compared with paclitaxel alone (median PFS = 11.8 vs 5.9 months; HR for progression = 0.60; P < .001) (13). Yet, the benefit in PFS
did not translate into an increase in OS. The actual benefit to the patient of this prolongation in PFS is questionable because there was no improvement in quality of life as
demonstrated by the lack of statistically significant changes in scores on several validated instruments. Despite these data, the FDA approved bevacizumab for the treatment of
metastatic breast cancer.
Finally, marginal benefits have not been confined to biological agents. In pancreatic cancer, the addition of erlotinib to gemcitabine improved OS a mere 10 days (median OS =
6.24 vs 5.91 months) (14). The authors noted that objective response rates were not substantially different between the groups and that patients receiving erlotinib and
gemcitabine experienced higher frequencies of rash, diarrhea, infection, and stomatitis, but these were generally grade 1 or 2, albeit with dose reductions in 16% of patients
and treatment discontinuation due to toxicity or refusal in 10% and 8% of patients, respectively. Again, we must ask ourselves if the additional 10 days are a benefit.
Furthermore, in renal cell carcinoma, an OS advantage for sorafenib could only be demonstrated by comparing the sorafenib-treated cohort with the placebo patients who did
not cross over to receive sorafenib, clearly a group of patients with a poorer prognosis, and the survival advantage was obtained at a substantial cost in terms of both toxicity
and expense (15,16).
These examples challenge the oncology community to address some serious questions: What should count as a benefit in cancer? What is the minimum amount of benefit needed
to adopt a therapy as the new standard? Is 1.2 months of additional life a “good” in itself? How much should the quality of that 1.2 months matter? Or the cost?
Previous SectionNext Section
The Costs of Cancer Treatments
In the United States, 18 weeks of cetuximab treatment for NSCLC costs an average of $80 000, which translates into an expenditure of $800 000 to prolong the life of one patient
by 1 year (17) (Table 1). Cetuximab is not unique in costing more than the median US household income ($50 233) (18) or a year’s tuition at the finest colleges in the country
(19)—bevacizumab costs $90 000 to treat an average patient (17 and Table 1). Erlotinib and sorafenib as used in the registration regimens cost approximately $16 000–$34 000
per patient (Table 1) (17). By comparison, artificial renal dialysis costs $129 090 for one quality-adjusted life year (20).
Table 1
Estimated drug costs for indications cited in the text*
In some sense, every life is of infinite value, and we naturally avoid confronting the tension between not wanting to put a value on a life and having limited resources. But the
spiraling cost of cancer care in particular makes this dilemma inescapable. We, the oncology community, cannot continue to ignore it. Such expensive therapies impose
substantial burdens on patients and providers of health insurance. We must stop deluding ourselves into thinking that prescribing cetuximab, bevacizumab, erlotinib, or any of
the other expensive chemotherapies and tests are an aberration, a temporary deviation from an otherwise reasonable cost trajectory. Indeed, greater than 90% of the
anticancer agents approved by the FDA in the last 4 years cost more than $20 000 for a 12-week course of treatment (17). These approvals—and the use of these drugs by
oncologists—signal to pharmaceutical companies our tolerance of such pricing, and they set a higher threshold for what society considers acceptable costs.
Previous SectionNext Section
New Drugs as Stepping Stones
We should also not assume that approval of these expensive drugs with marginal overall benefit would necessarily lead to identification, perhaps based on molecular techniques,
of a subset of patients that derives greater benefit and hence give us a greater return on our investment than was initially apparent. The recent ASCO Provisional Clinical
Opinion recommending that anti–epidermal growth factor receptor (EGFR) antibody therapy should not be administered to a patient with colorectal carcinoma if a KRAS
mutation in codon 12 or 13 is detected is a good start to the rational use of molecularly targeted agents (21). However, the majority of the 60%–80% of patients with colorectal
carcinoma who will still receive the anti-EGFR antibody cetuximab will not derive benefit, underscoring not how far we have come but how far we must go (21). Or consider the
use of erlotinib in pancreatic cancer, clearly a disease in which advances are urgently needed (14). Do we really believe that soon we will be able to identify the small
percentage of patients who had some marginal benefit? Who will fund this research? And who will conduct it?
Because none of the novel therapies mentioned above has achieved cures, the majority of patients with treatment-refractory cancers eventually receive them, often in
succession, adding to the financial burden to society. Although it is true that progress is often incremental—recent improvement in the treatment of colon cancer is a clear
example—advances are likely to be discarded or trumped by completely new therapies (eg, Gleevec's displacement of interferon and stem cell transplant in chronic
myelogenous leukemia). Thus, not all advances are building blocks for the future, and this expectation should not justify expenditures for marginal benefits in patients with
advanced disease. An example of this is the recent observation in colorectal cancer that addition of cetuximab to capecitabine, oxaliplatin, and bevacizumab resulted in shorter
PFS and inferior quality of life—an observation reinforced by similar results with panitumumab (22,23). Furthermore, although some agents (eg, Trastuzumab) (24,25) approved
in the metastatic setting may also have benefit in the first-line setting, a better outcome in first-line therapy is not guaranteed, especially for drugs with marginal benefits. For
example, a recent study examining the potential benefits of treatment with sorafenib (Nexavar) in patients with untreated advanced renal cancer found a minimal difference in
median PFS when the drug was administered as first-line therapy (median PFS = 5.7 months) compared with its previous benefit in second-line therapy (median PFS = 5.5
months) (15,26). Unfortunately, differences in OS were not reported—an important omission—because if in an earlier setting a drug has a benefit in PFS that is marginal and
similar to that in patients with advanced disease, it may not result in a statistically significant OS advantage. For the patient with advanced disease and at best 12 months of
expected survival, an extra month or two might be statistically meaningful, but it may not be so for a patient at an earlier point in their disease expected to survive a few years.
Previous SectionNext Section
What Is to Be Done?
Who should tackle this problem? ASCO and other professional societies have an essential role in defining standards of care. If a treatment with marginal benefit is declared a new
standard and a clinically or statistically significant gain at a plenary presentation of its annual meeting and this is featured at press briefings, ASCO effectively endorses—or
appears to endorse—that view. Sadly, some years do not produce breakthroughs in treatment of sufficient importance to fill a plenary session. This does not mean that
marginal benefits should be showcased; other types of presentations merit consideration for plenary session presentations. We must not let P values or the increasingly popular
hazard ratio define success. For drugs that target EGFR, which has been long touted as an important target in lung and colorectal cancers, marginal benefit in NSCLC and
colorectal cancer is nothing less than a major disappointment. Attempts to view this otherwise place hope above data, experience, and reality. We must recognize that
professions can regulate themselves and, in fact, that is part of the role of a professional society. ASCO should lead the way in engaging oncologists and the public in dialogue
about what should count as a benefit. Oncologists should feel supported if they decide that for a given patient or group of patients, the marginal benefit is not worth the cost.
Cancer researchers should be clear about the benefit they are trying to achieve in a trial, how it will be measured, and what it will mean for the field.
The FDA must also shoulder responsibility. It should reconsider the validity of PFS as an endpoint, especially when OS is not affected and the advance in PFS is not accompanied by
an improvement in quality of life. More importantly, trial design is critical for determining what magnitude of survival advantage will pass that magical P value of .05. In the
cetuximab trial, the 1.2-month survival advantage achieved statistical significance because the inclusion of 1125 patients ensured that a small difference would reach statistical
validity. The FDA should encourage trials powered for larger differences and discourage those looking for marginal differences. Trials that demonstrate no survival advantage or
prolonged survival of only 1 or 2 months should be subject to greater scrutiny.
Insurance companies and government health agencies should also assume some responsibility. Although patients with end-stage renal disease might receive greater financial
support overall than cancer patients because they live longer, we should not advocate spending more for cancer patients than for those with end-stage renal disease. Other
developed countries spend less than $129 090 for an extra year of life and this should be sufficient to buy excellent care (27,28). In Great Britain, for example, the National
Institute for Clinical Excellence has established a maximum threshold of €30 000 per quality-adjusted life year. Insurance companies and government agencies should
benchmark therapies to an agreed on amount. If this were done, Americans would still receive excellent care. This would not inhibit innovation but direct it toward
interventions that produce clinically significant improvements in health outcomes or ones that can be priced at a lower level commensurate with their marginal benefits.
Government agencies could engage the public—not just interested drug companies, oncologists, and patient advocates—in deliberations regarding how much they are willing
to pay to achieve certain levels of benefit. Knowing the maximum Americans are willing to spend could transform pharmaceutical companies and their practices because they
recognize that to extend indications, they must compromise on price. Thus, a small survival advantage would only be acceptable if a company were willing to substantially
reduce a drug's price in exchange for a larger market share. For those unwilling or unable to reduce prices, only smaller studies that detect larger differences should be
tolerated. Such changes would streamline drug development, reduce costs, and lead to more rapid completion of clinical trials. Rather than hamper research and development,
this would lead to a greater focus on a better pipeline with less redundancy across companies. After all, do we need 10 companies developing similar drugs for each potential
target?
Many Americans would likely not regard a 1.2-month survival advantage as “significant” progress, the much revered P value notwithstanding. But would an individual patient
agree? Although we lack the answer to this question, we would suggest that the death of a mother of four at age 37 years would be no less painful were it to occur at age 37
years and 1 month, nor would the passing of a 67-year-old who planned to travel after retiring be any less difficult for the spouse were it to have occurred 1 month later.
Indeed, although one hopes that insurance companies never offer patients the choice between receiving a therapy with marginal benefit and receiving a fraction of the cost as a
monetary disbursement, it would not be surprising to see patients opt for the disbursement to leave to their loved ones or to spend with them while they are alive.
Previous SectionNext Section
The Responsibility of Oncologists
Ultimately, however, what counts as a benefit in cancer treatment and how much cost should factor into deliberations are not ethical problems that can be relegated to others.
No segment of society is better qualified to address these issues than the oncology community. It is time to confront these issues, lest others confront them for us. Oncologists
must offer clear guidance both in the conduct of research and in prescribing chemotherapies. To begin the discussion in the profession, we suggest the following standards:
1. Research studies that are powered to detect a survival advantage of 2 months or less should only test interventions that can be marketed at a cost of less than $20 000 for
a course of treatment, which is a monetary value consistent with the cost of one quality-adjusted life year in patients treated with artificial renal dialysis ($129 090).
Similarly, a study designed to detect a 4-month advantage can test a therapy that will cost up to $30 000 per patient. The corollary of this is that we should demand that
drugs already approved be priced accordingly. For example, it has been estimated that to be cost-effective even at the $100 000 per quality-adjusted life year level, the
retail price of 6 months of erlotinib would have to be reduced by 80% (29).
2. Drugs shown to be active in one subset of patients should be advocated, approved, and prescribed for that subset only. The marginal benefit, if any, which may be
achieved in other patients should not be an excuse to administer a therapy even if it is decided that there is nothing further to be done.
3. FDA-approved indications should be strictly adhered to. If the FDA approves a drug for first-line therapy, it should not be used in a second-line setting unless evidence is
obtained that sequential therapies provide meaningful benefit that outweighs toxicities. Without such evidence, insurance companies should deny coverage, and
physicians should not administer the drug.
4. The all too common practice of administering a new, marginally beneficial drug to a patient with advanced cancer should be strongly discouraged. In cases where there
are no further treatment options, emphasis should be first on quality of life and then cost. Although we recognize that oncologists are faced every day with dying patients
who still want to pursue further therapy, we must avoid the temptation to tell a patient that a new drug (eg, single-agent bevacizumab or cetuximab) is available if there is
little evidence that it will work better than established drugs (eg, oral etoposide or cytoxan) that could be offered at a miniscule fraction of the cost and with possibly less
toxicity.
5. For therapies with marginal benefits, toxic effects should receive greater scrutiny. Consideration could be given to developing a cumulative toxicity index that considers
toxic effects—their grade, duration, and actual impact on quality of life—and allows for a more uniform comparison.
We must deal with the escalating price of cancer therapy now. If we allow a survival advantage of 1.2 months to be worth $80 000, and by extrapolation survival of 1 year to be
valued at $800 000, we would need $440 billion annually—an amount nearly 100 times the budget of the National Cancer Institute—to extend by 1 year the life of the 550 000
Americans who die of cancer annually. And no one would be cured.
The current situation cannot continue. We cannot ignore the cumulative costs of the tests and treatments we recommend and prescribe. As the agents of change, professional
societies, including their academic and practicing oncologist members, must lead the way. The time to start is now.
Pharmaceutical Cost Control In Canada: Does
It Work?
by Devidas Menon
Although price controls have worked to a certain extent, drug expenditures continue to rise.
ABSTRACT: Governments in Canada have instituted mechanisms intended to
control drug prices. These include the establishment of a semi-judicial body by
the federal government to control factory-gate prices and of various measures at the provincial level, such as formulary management, use of generics, refer- ence-based
pricing, price freezes, and limits on markups. To a large extent,
these measures have been effective in price control. Total drug spending in the
country continues to rise, however; clearly, mechanisms other than price controls will need to be developed if drug spending is to be better managed. T
he re s po n sibility fo r provi di ng health care to citizens
in Canada lies principally with provincial governments, although the federal Canada Health Act imposes some conditions on these governments. However, pharmaceuticals
used out- side hospitals lie outside the domain of the act. Consequently, there are many payers for pharmaceuticals. This paper discusses these payers’ roles and the
mechanisms that have been put in place to
regulate and control drug spending, and comments on the implications of these.
The Legislative Context The Canadian government’s Hospital Insurance and Diagnostic Services Act went into effect in 1958. Under this act, a cost-sharing
agreement was offered to provinces that developed publicly funded
insurance programs for medically necessary hospital services, in- cluding inpatient prescription drugs. In 1968 this coverage was in- creased to include physician services with
the passage of the Medi- cal Care Act. Although a royal commission on health care appointed
by the federal government (the Hall Commission, named after the chair, Justice Emmett Hall) had recommended inclusion of out©2001 Project HOPE–The People-to-People Health Foundation, Inc.
Devidas Menon is executive director and CEO of the Institute of Health Economics, and is a
professor of public health sciences at the University of Alberta, in Edmonton.
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pieces of legislation were repealed with
the passage of the Canada Health Act, which is now in force. Be- cause outpatient drugs are not considered “medically necessary services” covered by the act, there now are
numerous payers for prescription drugs in the country, including the federal and provincial governments, health care institutions, private insurers, and patients.
In parallel with these developments, a number of legislative actions took place on intellectual property protection. The “compul- sory licensing” provision of the Patent Act
(introduced initially in
1923) was amended in 1969 to allow a manufacturer to import a patented drug, if a royalty were paid to the patent holder.1 It was
“compulsory” in that the patent holder had to allow the other manufacturer to do this, with a fairly small royalty (4 percent). Generic drug manufacturers gained significant
market share after this. How- ever, compulsory licensing was seen as contributing to low levels of
research and development (R&D) investment (about 4.9 percent of sales in 1969) by the drug industry, and the patented drug manufacturers lobbied for change. In 1987 Bill
C-22 was passed, which extended the period of patent protection before compulsory licensing
could be possible. It also created the federal Patented Medicine Prices Review Board (PMPRB). The industry committed to increasing R&D investment in the country, up to 10
percent of sales by
1996. It also predicted an increase in numbers of scientific and re- search-related jobs as a result of the legislation.2 Finally, in 1991, Bill C-91 was passed. This was in part the
result of negotiations under
the General Agreement on Tariffs and Trade (GATT) and the North America Free Trade Agreement (NAFTA); it increased patent protection to up to twenty years and
eliminated compulsory licensing. These legislative actions on both public health insurance and patent protection have had major impacts on who pays for drugs in Canada
and what they pay for them. In 1997, for example, approxi- mately U.S.$5.6 billion was spent on prescription drugs (including drug costs, copayments, and dispensing fees).3
Half of this was paid
by public-sector sources (predominantly provincial prescription
drug benefit programs and hospitals), about 29 percent by individu- als with some private insurance; and 21 percent, out of pocket.4
Price Control: The Federal Government Role
The federal responsibility for drug price control rests with the PMPRB, an independent, quasi-judicial body.5 It is responsible for ensuring that prices charged by manufacturers
of patented drugs are not excessive. The PMPRB reports to Parliament through the minister of health.
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Downloaded from content.healthaffairs.org by Health Affairs on March 12, 2013n Classification scheme. The PMPRB does not set prices. In- stead, it reviews factory-gate
prices of individual products to deter- mine if they are excessive. To do this, the board has instituted a set of processes, including review of individual drug prices, conduct of
investigations, and application of enforcement mechanisms. The PMPRB process is based on the following classification scheme for all patented drugs: Category 1: a new drug
product that is an exten- sion of existing or comparable dosage form of an existing medicine, usually a new strength of an existing drug (“line extensions”); Cate- gory 2: the
first drug to effectively treat a particular illness or that provides a substantial improvement over existing drug products, often referred to as “breakthrough” or “substantial
improvement”; and Category 3: a new drug or dosage form of an existing drug that provides moderate, little, or no improvement over existing drugs
(“me-toos”).6 The board uses several criteria to classify a product. A manufacturer has to submit data (including price) to the PMPRB for classifi- cation of any drug. For a drug
that is to be considered a breakthrough, the manufacturer also has to include reviews of the product in recognized journals (where available), results of two to
five well-controlled trials, and results of a complete Medline search
of articles and reviews of the drug. Once a drug is classified, its price
is reviewed to determine if it is “excessive.”
“Excessive” is interpreted based on the following guidelines: (1) The price of an existing patented drug cannot increase by more than
the Consumer Price Index (CPI). (2) The price of a new drug (in most cases) is limited so that the cost of therapy with the new drug
is in the range of the costs of therapy with existing drugs in the same
therapeutic class. (3) The price of a breakthrough drug is limited to
the median of its prices in France, Germany, Italy, Sweden, Switzerland, Britain, and the United States. In addition, no patented drug
can be priced above the highest price in this group of countries. n Possible actions. The review of prices of all patented drugs is conducted on a regular basis. This is based on
manufacturers’ filings as well as on complaints about price. Manufacturers are supposed to
file price and sales information each year that the drug remains patented. These figures are then reviewed by board staff. As an
example, of the 840 patented drugs sold in 1999, 826 had undergone price reviews that year. Investigations are conducted when PMPRB
staff determine that a particular price appears to exceed the guidelines. If it is established that a price is excessive, the manufacturer can make what is called a Voluntary
Compliance Undertaking
(VCU) to adjust the price and take remedial action. This could
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initiate formal proceedings and hold a public hearing. Following such a hearing, it can order the manufacturer to
reduce the price so that it is no longer considered excessive, reduce
it even further for a specified time period so as to offset previously
earned excess revenues, reduce the price of one other patented drug of the same manufacturer, and, if required, order a payment to the government of Canada equal to
excess revenues. The board has
recourse to other legal action should compliance not be reached. n Effect on prices. The PMPRB uses the Patented Medicine Price Index (PMPI) as a measure of
manufacturers’ reported prices
for patented products. This index shows how much more or less a
fixed market basket of drugs would have cost in the current year
than in a reference year, using the quantities sold in the reference year.7 Between 1988 and 1993 the PMPI increased each year, repre- senting an increase in average price in
each of the years over the previous one. In the next five years the PMPI fell each year; that is, manufacturers’ prices for patented medicines fell each year. Between
1988 and 1999 manufacturers’ prices for all prescription and nonpre- scription drugs increased an average of 1.9 percent annually (compared with the average figure of 0.8
percent for prescription drugs), which is
less than the average annual increase in the CPI (2.6 percent).8 These data lead to the conclusion that prices have been increasing modestly at worst, and in fact decreasing in
some cases. What about
the actual prices themselves? In 1987 the ratio of the Canadian prices of patented drugs to the median of the prices in the seven compari- son countries was 1.23 (that is,
prices were, on average, 23 percent higher in Canada); Canadian prices were higher than in all of the other countries except the United States. This ratio has declined
since then, and in 1999 prices were on average about 10 percent below the comparison median; only the United States, Italy, and France had higher average prices.9 Currency
exchange rates could
have some influence on these ratios.10 Breakthrough drugs are particularly important in the PMPRB
review. Although they accounted for only about 12 percent of all patented drug sales in 1997, they have had much more impact than
this share might suggest. They are generally more costly and innovative and may also establish a new therapeutic class and therefore a
reference price for that class. In 1997, 97 percent of breakthrough drugs were priced below the international median, compared with
75 percent in 1990.
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Downloaded from content.healthaffairs.org by Health Affairs on March 12, 2013Price Control: The Provincial Governments’ Roles Various drug programs have been developed
by provincial govern- ments, particularly for the elderly and for persons requiring social assistance. This began in 1974 with the Ontario government’s Drug Benefit Program
for needy and elderly persons.11 Now, all provincial governments provide some form of publicly funded drug coverage
for seniors, for those requiring social assistance, and, to a certain
extent, for the general population.12 There are also special programs
for diseases such as cystic fibrosis and multiple sclerosis and for catastrophic expenses. Each province manages its own mix of cover- age plans, and rules of coverage vary
considerably. These include who is covered; what drugs are covered; copayments, deductibles, and premiums; encouraging cost-effective prescribing; and meas- ures
limiting prices, markups, and other fees.13 Despite interprovin- cial variations, there is general agreement that beneficiaries should
be provided with the most cost-effective therapies. Price is therefore an important consideration for coverage by a provincial drug program. A number of approaches have
been, are being, or can be used to manage either prices or expenditures. These include the use of for- mularies, generic substitution, reference-based pricing, price
freezes, controls on markups and dispensing, and “risk sharing.” n Formularies. After a new drug has received approval to be marketed and sold in Canada, the manufacturer
makes a submission
to a provincial government to have the drug covered by a particular drug program, which “covers” a specified list of prescription drugs
(the formulary). The drug program reviews effectiveness of a new
product in relation to its costs and determines whether it has a
therapeutic advantage over products already on the formulary. Usu- ally, a new drug that is merely equivalent to an existing listed drug will be added only if it does not
increase program costs. Manufacturers will therefore set prices so as to obtain market access to the publicly funded drug programs. “Value for money” data on new
products are increasingly being demanded by drug plan managers. Canadian guidelines have been developed to assist manufacturers in
designing, conducting, and reporting economic evaluations.14
In some cases, drugs may be added to the formulary under specific
conditions. For example, if a new drug is generally equivalent to
existing drugs for most uses but has a therapeutic advantage in a
specific use, it may be covered under a “special authorization” and
reimbursed for that use. Special programs may be created, as in Alberta, where new drugs for multiple sclerosis are available with
specific criteria for patient selection/eligibility. n Generics. For many years Canada encouraged competition in
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patent policy. Also, the drug regulatory review process allows generic drug manufacturers the option of providing data comparing the ingredients of their product with
those of the patented product, instead of repeating all of the studies originally conducted by the manufacturer of the patented product. This helps to reduce generics’ time to
market. Naturally, generics are priced lower than the original innovative products, as R&D costs are considerably lower for these products. Provincial (and other) drug
programs use generic substitution to
control expenditures. If a drug is available from multiple sources, provincial programs usually pay the price of the lowest-cost alternative. Generics make this possible when
they exist. Some provincial governments have gone even further, requiring that, for example, the
first generic available be priced at approximately three-quarters of
the level of the patented drug already on the formulary. n Reference-based pricing. Reference-based pricing (RBP) is an extension of the notion of generic substitution and has
been
introduced in British Columbia. RBP categories are identified—for example, nitrates for the treatment of unstable angina.15 The “refer- ence product” in each category is that
with the lowest price. The government uses an independent panel of pharmacists and doctors at the University of British Columbia to determine therapeutic
equivalence of drugs. This panel evaluates and compares the effectiveness of existing and new drugs for individual conditions, based
on research evidence. The drug benefits program will only reim- burse—for any drug in the category—the price of this reference product. The major difference between RBP
and generic substitution is that with RBP, drugs in a category need only to be therapeutically equivalent, not chemically identical. There are four drug
classes for which there is a reference standard.16 A physician can
request a nonreference product for a specific patient. This requires
the physician to apply for “Special Authority” to the drug program,
in which the physician must identify a specific medical need. n Price freezes. In Ontario a price freeze was instituted from
1994 through 1998. Since then, price increases have been considered,
if the manufacturer is prepared to provide a price reduction for a different drug so that the change is cost-neutral to the drug program. n Markups and dispensing fees. These
made up about onethird of the purchase price of drugs in 1997. Provincial governments can limit markups, so that prices of drugs bought under the provin- cial drug
program will be controlled. Similarly, they have some control over dispensing fees for drugs paid for by their programs, since
they are set either by them or through negotiations with provincial
PRESCRIPTION DRUGS 97
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Downloaded from content.healthaffairs.org by Health Affairs on March 12, 2013pharmacists’ associations. In Canada there is little opportunity for discounting prices of
patented drugs, although discounting is com- mon with generics. n “Risk sharing.” Recently, some governments have started to negotiate with companies to reach
agreements aimed at limiting
total expenditures on specific drugs. These could, for example, com- pel the company to pay the province for expenditures above an
agreed-to figure. Specifically, since 1988, in Ontario, as a condition
for listing a patented drug, manufacturers must enter into agree- ments with government forecasting what the drug will cost the program (excluding dispensing fees and
markups) each year for
three years. n Other payers. Health care institutions, private insurers (unions, employers, insurance companies), and individual patients also pay for drugs. The prices paid by
these groups are influenced by what the provincial programs pay. In the retail sector, however,
there is no control over markups and dispensing fees (as there is in
the provincial programs); patients paying for their own medications may face higher final prices. This could also be true for third-party payers, although some of them may
negotiate fees. In the hospital sector, discounts are possible. Hospitals often negotiate specific arrangements with individual companies. n Effect on prices. Three factors
come into play: price trends, price levels, and drug expenditures. A recent analysis of prices and
expenditures by six of the provincial drug programs from 1990 to
1997 provides some insight into all three areas.17 (These six provinces contain approximately 70 percent of the population of Canada.) Trends. Annual increases in retail prices
of patented drugs (ex- cluding dispensing fees) fell from 1990 on; since 1994 average prices have actually dropped. This is on average true for the prices of nonpatented
single-source drugs as well, while for nonpatented multiple-source drugs, this trend of annual price decreases began in
1993. Such averages might be misleading, however, because the changes in the individual provinces were different. For example, in Ontario patented drug prices dropped
more rapidly than in the other provinces, and in Alberta, following three years of annual
reductions in price for these products, there was a slight increase in
1997. Clearly, different provincial policies affect prices differently. Over the entire period, price increases of the three types of drug
“Even when a drug has been launched in Canada, access for patients across the country may be an issue.”
98 CANADA
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Downloaded from content.healthaffairs.org by Health Affairs on March 12, 2013products were below the rate of inflation. Prices. Patented drugs undergo PMPRB price
control, but prices of nonpatented drugs are under less control. In 1996 Canadian prices
for nonpatented single-source products (in the six provincial drug programs reviewed) were, on average, 30 percent higher than the median international price. In a countryto-country comparison, based on the top seventy-two drugs in this group, Canada ranked
second-highest in overall average price, below the United States, where prices were, on average, 96 percent higher. At the other end of
the spectrum is Italy, with prices on average being 47 percent of Canadian prices.18 These higher Canadian prices may be due to the
fact that there is only one supplier for the product in the country. Expenditures. Exhibit 1 shows expenditures by these six provincial programs from 1990 to 1997. Despite
price-control mechanisms, ex- penditures on drugs have been increasing in the provinces. What Are The Issues And Tensions?
The objective of price-control measures is obviously to control price, and this has succeeded to some extent in Canada. But expen- ditures continue to increase. Also, it is not
clear what some of the other effects have been, most of which relate to access to needed
drugs. This is the source of major tension between governments and
the drug industry in Canada. Manufacturers in Canada are concerned with the interpretation
of the criteria for breakthrough or Category 2 drugs, although they
feel that the process of PMPRB review is itself transparent. In the
eight years between 1988 and 1995, of the 581 drugs reviewed by the board, only 41 were classified as breakthrough and thus offered a potentially good price for the
manufacturers. The industry has sug- gested that four categories be used by PMPRB. In one approach, breakthroughs and line extensions would be retained as categories,
EXHIBIT 1 Provincial Government Drug Spending, Millions Of U.S. Dollars, 1990–1997
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class extension—created.19
It has been reported that because of some PMPRB rulings, certain
drugs have not been launched in Canada, although they have under- gone regulatory review and received a Notice of Compliance.20 Price
levels set by the PMPRB, especially when compared with U.S. prices, are claimed to be a disincentive to launch in a country that has only 2 percent of the world drug market.
There certainly are a number of drugs that have been approved for sale both in Canada
and the United States but that have not been launched in Canada. Examples include Ambien (zolpidem/Searle), a hypnotic; Capozide
(captopril-hydrochlorthiazide/Bristol Myers Squibb), a combination of an angiotensin converting enzyme (ACE) inhibitor and a diuretic; and Lorabid (loracarbef/Eli Lilly) and
Orelox (cefpo- doxime/Aventis), both antibiotics. Price limits may have caused this
(especially for Ambien), but this has yet to be rigorously proven. The patented-drug manufacturers’ association Rx&D has re- cently expressed concern about the pricing
restrictions of the PMPRB: “It must be realized that attempts to lower prices below
current levels will ultimately have a negative impact on Canadians’ access to new medications, and the benefits of research and develop- ment investment.”21 This statement
indicates the position of the manufacturers—namely, that investment by the industry in R&D is a benefit to Canadians, quite apart from direct health benefit. Ex- hibit 2
compares the ratio of R&D to domestic sales in the comparator countries and Canada in 1988 and 1995. The industry association
has claimed that the number of jobs in the industry went from
14,500 in 1987 to 21,000 in 1999; of this, an increase of more than
3,000 has been attributed to R&D-related jobs. However, it is not clear exactly what the nature of these jobs is, or whether they are greatly increasing research capacity in the
country.
EXHIBIT 2 Pharmaceutical Research And Development As A Percentage Of Domestic Sales, In Eight Countries, 1988 And 1995
Canada
100 CANADA
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Downloaded from content.healthaffairs.org by Health Affairs on March 12, 2013Even when a drug has been launched in Canada, access for patients across the country may be
an issue. This is mainly a result of
the fact that Canada really has ten formularies, about which decisions are made independently by provinces. A recent study that examined the 148 new drug molecules
launched between 1991 and
1998 demonstrated significant variation in access in provincial drug programs.22 For example, of the twenty-three drugs for cardiovascular disease, one province had ten
under the drug program and an- other had all but one. Variations such as these were found even after correcting for known differences between provincial programs (for
example, some cancer drugs are funded by the government through
cancer boards and are not included on the provincial formularies). Price is certainly a consideration in these decisions and may well have something to do with these
variations. Clearly, in some provinces individuals have to pay out of pocket for certain prescription
drugs that would have been subsidized by government in another province, or worse, they may not take the drug at all. Such findings raise questions about how provincial
formulary decisions are actually made. Companies claim that they provide the
same information to the various provinces, yet the decisions are different. In fact, for the economic evaluation component of the
submissions (which is often a requirement by government), there are accepted national guidelines. Industry spokespeople express
frustration that they spend time and effort having evaluations con- ducted according to the guidelines, yet governments seem to ignore
them. This is despite the fact that based on two years’ worth of experience with the guidelines, a review showed that economic
evaluations were well presented, complete, and transparent, thanks
in part to the guidelines.23 There are conflicting claims regarding the effects of reference- based pricing. A 1996 survey concluded that senior citizens in British Columbia
supported the RBP program; more than 90 percent of
those surveyed were in favor, and only 14 percent believed that it would affect access to care.24 On the other hand, the industry asso- ciation in Canada challenged RBP in the
courts. This series of challenges lasted three years and involved two appeals by the association. Ultimately, the Supreme Court of Canada ruled in favor of the government,
which then claimed that the $74 million saved through
this program could be used to maintain and protect the drug pro- gram and to make other innovative drugs available in the province. The definitive study on the downstream
effects of RBP has yet to be done, although some early results of studies are emerging.25 Finally, the assertion is made that decisions are being made on the basis of drug
price alone (as opposed to considering overall costPRESCRIPTION DRUGS 101
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Downloaded from content.healthaffairs.org by Health Affairs on March 12, 2013effectiveness), and as such are inappropriate. Often it is cost containment within the drug
program that drives formulary decisions,
in isolation of cost reductions that might occur elsewhere in the health care system were the drug to be used. This is another source of frustration for the industry, which is
usually asked to provide
economic analyses from a societal perspective of the impact of their new product, only to have (from their point of view) the societal benefits accruing in another sector
ignored when the decision is made. A
number of ca nadia n federal and provincial government actions to control the price of drugs seem to have attained
their objective to a large extent. At the same time, drug
spending continues to increase. Between 1990 and 1997 drug spending (on all drugs) increased at an average of 5 percent a year. As a proportion of total health spending,
there has been a constant in- crease as well. A recent report indicates that between 1990 and 1997
the percentage of total health care spending attributable to pre- scription drugs increased by 2.7 percentage points in Canada. This compares with the Organization for
Economic Cooperation and Development (OECD) median increase of 1.3 percentage points.26 From a public policy perspective, expenditures are probably more
relevant than prices. Clearly, price is merely one of the many factors
that influence expenditures. Others include population demographics, prescribing practices, and introduction of new and innovative drugs, some of which might replace
nondrug therapy. If pharmaceuticals are to better managed, as much (if not more) attention has to be paid to these factors, and their impacts as has been paid to drug
prices
Breakthrough” drugs and growth in expenditure on
prescription drugs in Canada
Steven G Morgan, Kenneth L Bassett, James M Wright, Robert G Evans, Morris L
Barer,
Patricia A Caetano, Charlyn D Black
Driven by increased use of prescription drugs and by
shifts from old to new products, spending on drugs in
Canada doubled between 1996 and 2003.1
Which
drugs drove this expenditure growth? The Canadian
Patented Medicine Prices Review Board appraises the
therapeutic novelty of every patented medicine in
Canada to distinguish “breakthrough” drugs from
other medicines. Since 1990, the board has published
these appraisals in annual reports.2
We applied the
board’s classifications for breakthrough drugs to total
expenditures on and use of prescription drugs in the
province of British Columbia (population 4.2 million).
Methods and results
Between 1990 and 2003, the board appraised 1147
newly patented drugs (identified by active ingredient(s),
formulation, and strength), including derivatives of existing medicines, such as
esomeprazole. Of these new
drugs, 68 (5.9%) met the regulatory criterion of being a
breakthrough drug (“the first drug to treat effectively a
particular illness or which provides a substantial
improvement over existing drug products”).2
These
included, for example, filgrastim, donepezil hydrochloride, and infliximab.We
expanded the criterion for being
a breakthrough drug, however, to include all subsequent
formulations and dosages of a classified breakthrough
drug, as well as all competing drugs to enter the chemical subgroup3
established by a classified breakthrough
drug. All variants on a breakthrough drug were therefore also classified as
breakthroughs. This increased the
number of breakthrough products in our study to 142.
The remaining 1005 new drugs did not provide a
“substantial improvement over existing drug products.”
We classified them as “me-too” drugs. The Patented
Medicine Prices Review Board’s breakthrough assessments are not available for
drugs first marketed before
1990; we therefore classified these only as “vintage
brand” or “vintage generic” drugs. Generic versions of
drugs marketed before 1990 were classified as vintage
regardless of year of introduction.
From 1996 to 2003, per capita expenditure on prescription drugs in British
Columbia more than
doubled (from $141 (£78; €115) to $316) and per
capita days of treatment supplied increased by just over
half (from 194 to 301 days) (figure). Cost per day supplied rose from $0.73 to
$1.05.
Breakthrough drugs accounted for 6% of expenditure and 1% of use in 1996,
and 10% of expenditure and
2% of use in 2003. Vintage brand and vintage generic
drugs combined accounted for 75% of total use in 1996
and 54% in 2003, but only 53% and 27% of total annual
expenditure for those two years respectively. In contrast,
me-too drugs accounted for 44% of use and 63% of
expenditure by 2003. Their average cost per day of
treatment was twice that of vintage brand drugs and four
times that of vintage generic drugs.
Comment
In British Columbia most (80%) of the increase in drug
expenditure between 1996 and 2003 was explained by
the use of new, patented drug products that did not
offer substantial improvements on less expensive alternatives available before
1990. The rising cost of using
these me-too drugs at prices far exceeding those of
time tested competitors deserves careful scrutiny.
Approaches to drug pricing such as those used in New
Zealand4
may enable savings that could be diverted
towards other healthcare needs. For example, $350m
(26% of total expenditure on prescription drugs)
would have been saved in British Columbia if half of
the me-too drugs consumed in 2003 were priced to
compete with older alternatives. This saving could pay
the fees of more than a thousand new doctors.
Given that the list of top 20 drugs in global sales5
includes newly patented versions of drugs in long
established categories (that is, marketed before 1990)—
such as angiotensin converting enzyme inhibitors, statins, selective serotonin
reuptake inhibitors, and proton
pump inhibitors—me-too drugs probably dominate
spending trends in most developed countries
Epirubicin for breast cancer may cause considerable
venous sclerosis
Paula Bolton-Maggs, Aileen Flavin
The use of the adjuvant epirubicin for breast cancer in the
United Kingdom has increased since initial data from the
national epirubicin adjuvant trial (NEAT) were presented
in 2003.1
Two women, aged 53 and 55 years, developed
pain and restriction of movement of the arm due to
venous sclerosis after having infusions of epirubicin. They
both had grade 3 invasive ductal carcinoma and had had
surgery and axillary node dissection followed by eight
courses of adjuvant chemotherapy using the epirubicin,
cyclophosphamide, methotrexate, and fluorouracil
regimen. This includes four cycles of epirubicin 100
mg/m2
given at 21 day intervals.
Neither woman experienced extravasation or pain at
the sites of infusion. The first woman had the first two
injections into a large antecubital vein. At the time of the
second infusion, two other ipsilateral antecubital veins had
thrombosed. The infused vein became hard, swollen, and
tender 18 days after the second infusion. Subsequent doses
were given into two different veins in the back of the hand.
The vein used for the third infusion thrombosed together
with associated nearby veins, leading to painful symptoms
within a week or two in the network of veins further up the
arm. The fourth infusion was given into the back of the
hand and resulted in sclerosis of veins on the anterior
surface of the arm proximal to the wrist, but not directly
involving the infused vein.
The second woman described similar symptoms, with
aching and pain in the arm days after the second
infusion. Both patients experienced pain on extension of
the elbow due to tightening of the affected veins and
developed puckering of the skin over most of the venous
networks in the arm (figure). Similar symptoms
developed around the wrist; extension and flexion
became painful, lasting more than three months. The
second woman gave up driving her car.
This complication had not previously been reported
to the Committee on Safety of Medicines or the drug
company, although the serious effects of extravasation of
the drug are known.2 3 The medical information for
epirubicin contains a limited statement indicating venous
sclerosis occurs if small veins are used or with repeated
use of the same vein. Irritant drugs are those defined as
causing symptoms such as these, which are described as
self limiting with no long term sequelae.2
The experience
of these women indicates that venous sclerosis may be
more extensive and troublesome than has previously
been recognised and that extravasation injury is merely
the tip of the iceberg.
Introduction
Emergency department overcrowding is a chronic, systemic and serious public health issue that affects all EDs in Ontario. It has numerous negative consequences, including the
potential for increased morbidity and mortality and placing the general public at risk as a result of ambulance diversion. Despite the chronicity of the problem and an impressive
international literature base, ED overcrowding remains poorly understood by government, regional health authorities, hospital administrations and the leaders of organized
medicine.
On Dec. 14, 2000, the Canadian Association of Emergency Physicians (CAEP) and the National Emergency Nurses' Affiliation (NENA) released a Joint Position Statement on
emergency department overcrowding.1 On the same day, the Section on Emergency Medicine of the Ontario Medical Association released its own Position Paper.2 The Section's
paper, No Room at the Inn, was based on a literature review and attempted to provide a factual basis for focused reform and resolution of the problem. It is précised here.
Definition: Emergency department (ED) overcrowding is not clearly defined in the emergency medical literature. This lack of definition limits our ability to study the problem and
develop effective solutions.
EDs were designed to evaluate and manage patients over a 2- to 3-hour period.3 When the delay in transfer of admitted patients to a hospital bed is longer than 4 hours this could
be classified as overcrowding. The ED can become gridlocked, with no available beds to bring in new acutely ill or injured patients from either the waiting room or from arriving
ambulances.4 Admitted patients in the ED utilize a disproportionate share of resources. They require 2.5 times more service from emergency physicians and nurses compared to
the average ED patient.5
A reasonably functional definition is that overcrowding exists when the volume of patients seeking care exceeds an ED's capacity to provide care within an ideal time frame.
Scope of the problem
ED overcrowding is not unique to North America. It has been described in Australia, Great Britain, Spain and Taiwan.4,6,7
In the US, ED overcrowding emerged as an issue in the mid-1980s, reported initially from New York City.8,9 It soon became recognized as a widespread problem in urban centres
across the United States.10 In 1989, the American College of Emergency Physicians (ACEP) conducted an informal poll of state chapter presidents to gauge the extent of the
problem nationwide. Forty-one state chapters and the District of Columbia reported serious problems with ED overcrowding.11 The following year, in a survey of US teaching
hospitals, Andrulis and colleagues determined that 38% of 277 responding institutions reported that overcrowding sometimes forced them to hold admitted patients in the ED
for 24 hours or longer.12 In response to growing concern by its members, ACEP convened a national task force whose recommendations were published in 1990.13
In recent years, ED overcrowding has become a major focus of national media coverage and public concern in Canada. However, it is not a new problem. In Ontario, ED
overcrowding was initially reported in the late 1980s14-19and continued throughout the 1990s.20
In the late 1990s, ED overcrowding had risen to such crisis proportions in Toronto that a task force was struck by the Ontario Hospital Association (OHA) to review the root causes
and to develop a series of recommendations for its solution.21,22
Despite its characterization as an urban problem, it is clear that overcrowding also exists in nonurban environments.23
Causes of ED overcrowding
The causes of ED overcrowding are complex and multifactorial.9,11,24-26 These were summarized by Derlet and Richards,24 and their article forms the basis for the following section.
1. Lack of beds for patients admitted to the hospital
In Ontario and throughout Canada, the lack of beds for patients admitted to the hospital appears to be a significant contributor to ED overcrowding. With insufficient hospital
beds, patients in the ED who require hospitalization must wait in the ED until a bed becomes available. In Ontario, the hospital system is currently designed to operate on a bed
occupancy rate of 95%. Many authorities suggest that a bed occupancy rate of 85% would provide the system with much needed flexibility.27
In Toronto, the OHA reported an overall decline in the number of staffed acute care beds of 19.2% between 1992 and 1996. This was noted to be extremely close to the decline in
the overall hospital census of 19.6%, suggesting that overall hospital occupancy for the region had remained stable. However, the report points out that the mix of beds
available has not been maintained in proportion to demand. For example, the volume of cases that required critical care increased 1.4% in the period 1992/93 to 1996/97, while
the number of critical care beds declined by 6.6%.21
In the past 6 years there has been a reduction in acute care beds of 22%, occupancy rates are up by 7.4% and critical care beds have been reduced by 10.7%.22
In Ontario, the problem is not only due to an absolute reduction of beds but also due to a lack of flexibility in service-specific bed allocation. This leads to problems with the mix of
beds available at times of high demand. Most authorities would agree that there is a requirement for "flex beds" to allow for variations in bed demand.28
There is also a problem with "alternate level of care" (ALC) patients who would be best served by transfer to a long-term care facility, but because of a shortage of long-term beds,
occupy acute care hospital beds. The utilization of acute care beds by ALC patients -- "bed blockers" -- contributes to the problem of ED overcrowding by preventing the
admission of emergency patients to hospital beds. A recent OHA survey of hospitals in Toronto21 revealed that ALC patients occupied an average of 10% of total staffed bed
capacity. Some individual hospitals reported the percentage to be much higher, at 20% to 25%.
The report also revealed that "bed blockers" affect not only the ED but also critical care areas. The critical care capacity of the surveyed hospitals was reduced by 10% by patients
awaiting transfer to other beds in the hospital.
2. Shortage of nursing staff
In 1999, Ontario had the lowest number of registered nurses employed in nursing per 10 000 population by province/territory in Canada; 67.6 nurses/10 000 population
compared to the Canadian average of 74.6.22
There is a perception that there is a shortage of adequately trained emergency nurses in Ontario. This needs to be quantified. Experienced nursing staff are vitally important to
the provision of high quality care in the ED.
One factor is the move of some hospitals to staff the ED with part-time nurses to lower costs. This creates shortages within the department as experienced personnel move into
full-time jobs outside of the ED. A corollary to this problem is the high staff turnover in some EDs, leading to a higher percentage of new, inexperienced emergency nurses, who
may not be as efficient in the delivery of care.
3. Increased complexity and acuity of patients in the ED
The population is aging and has more chronic disease that often exacerbates and requires ED care. AIDS, drug abuse, homelessness, domestic violence and the deinstitutionalization of the mentally ill have also had an impact on the complexity of cases encountered in the ED. The increasing frequency of day surgery has led to increased
visits to the ED for post-operative complications such as nausea and vomiting, poor post-operative pain management and wound infections.
The evaluation and maintenance of surgical critical care patients in the ED is no longer a rare occurrence.29,30Their collective requirement for procedures and laboratory
investigations contribute to their ED length of stay (LOS). The use of computed tomography (CT) and special procedures are the strongest independent predictors of prolonged
LOS.31
4. Increase in patient volumes
The ED is a major access point to the health care system for Ontario's citizens. In 1990 there were an estimated 3.4 million annual visits to the province's EDs.16 In 1993 there
were over 4 million ED patient visits, and in 1999 that number had increased to 5.1 million.22
Between 42% to 55% of all ED visits involve nonurgent problems.32 Most experts in the field of ED administration discount the effect of the "inappropriate" emergency patient, the
patient who seeks primary medical care from the ED, as contributing significantly to overcrowding.
First, there is no agreement within the specialty of emergency medicine as to what constitutes an inappropriate visit.33,34 There is also an increasing appreciation that the ED can
provide acceptable primary care to a portion of the population, with no additional cost to the system. As such, the ED fills an important gap in the health care social safety
net.9,35-40 Finally, it is becoming increasingly apparent that declaring nonurgent use of the ED as the "fashionable scapegoat for the ills of the health care system" is not only
misguided but can lead to inappropriate attempts to either restrict or divert access to the ED.41,42
5. Intensive therapy in the ED
Advances in the scope of practice in emergency medicine have led to increasing LOSs for patients in the ED. Thrombolysis for acute myocardial infarction, sedation for painful
emergency procedures and a new understanding of the need for more aggressive and prolonged therapy of asthma and migraine have led to more prolonged visits to the ED.
Many conditions that used to require admission are now evaluated and managed in the ED, including thromboembolic disease, chest pain evaluation, nephrolithiasis and
infectious diseases such as pneumonia and pyelonephritis. This requires additional human resources and ED beds.
6. Delays in service provided by radiology, laboratory and ancillary services
As a result of advancing technology and changing standards of care, more patients in the ED need CT scans, ultrasounds and other diagnostic testing, all of which lead to longer
ED stays.
In many hospitals, there has been the development of an institutionalized culture that does not actively support the smooth functioning of the ED. Delays in responding to
requests for x-rays and laboratory tests inevitably lead to delays in treatment and prolonged ED stays.
7. Shortage of on-call specialty consultants, delay in response or lack of availability
Specialist consultation is an integral component of emergency care. A consultant may be called to the ED to directly participate in the patient's care or may be contacted to
provide a consult once the patient is admitted. Some patients, because of the complexity of their illness or injuries, may require more than one consultant.
The process of consultation can be complicated. One study43 reviewed the response of consultants to a community ED. Although in many instances consultants responded to their
initial page, multiple attempts were often required. After telephone contact, a significant interval (on average, 40 minutes) elapsed before the consultant actually came to the
ED. Delays in consultant response contribute to prolonged ED patient stays and thus to overcrowding.
In the situation of smaller community hospitals, certain specialties may not be available, and emergency patients may need to be transferred to a larger hospital with even greater
delays.
8. Shortage of physical plant space within the ED
As the average LOS increases for patients presenting to the ED, a larger department becomes necessary just to facilitate the same number of patients. This problem becomes
compounded when the ED experiences an increase in patient volumes.
Coupled to this is the change in practice patterns. Patients who were once admitted are now investigated, treated, observed and then discharged from the ED. This further
increases the need for physical space.
9. Difficulty in arranging follow-up care
Many patients in the ED require the involvement of home care or social services. Others require the arrangement of appropriate medical or surgical follow-up care. Such
administrative requirements require considerable time and delay patient discharges from the ED.
10. Difficulty in the transfer process
Inter-facility transport in the province has always been complex. The historic problem of finding an available bed for a given type of clinical problem has been greatly assisted in
Ontario by dedicated, centralized Critical Care Access hotlines. Similarly, the requirement to find professional staff to accompany the patient while in transfer has been
ameliorated in rural hospitals by the welcome development of dedicated Advanced Life Support (ALS) air ambulance personnel. The current problem, however, commonly
involves the lack of availability of ground ambulance transport for patient transfers. In smaller community and rural hospitals, this leads to significant delays in the patient
transfer process and can lead to ED overcrowding.
Effects of overcrowding
Overcrowding in the ED has a number of sequelae that negatively impact on patient care.
1. Public safety at risk
Overcrowded EDs can be associated with poor patient outcomes. As physicians are seeing more complex, acutely ill patients, they often have inadequate time for proper
patient assessments. This can lead to medical error, poor outcomes and increased medicolegal risk.
In 1 study of the influence of overcrowding on health care quality provided in a university teaching hospital, there was an observed, significant, positive correlation between
mortality rates and the weekly number of patient visits.44
2. Prolonged pain and suffering
During times of overcrowding, emergency patients may experience prolonged pain and suffering unnecessarily because the ED staff is too busy to attend to them.
3. Long waits and patient dissatisfaction
An overcrowded ED will, by definition, lead to prolonged waits for treatment and increased patient dissatisfaction. This dissatisfaction is reflected in an increasing number of
patients who leave without being seen. In Ontario in 1999, there was an increase of 2% in the number of patients who left the ED without having been assessed by a physician
(Marion Lyver, EHS Consultant, Ministry of Health and Long Term Care, Province of Ontario: personal communication, 2001).
The consequence of this is the potential for seemingly minor medical problems to become more serious from delay in care. The myth that patients who "leave without being
seen" usually have minor, insignificant illness has recently been dispelled.45
4. Increased costs
The overcrowding of EDs with inpatients results in an increased average inpatient LOS. This leads to increased costs per patient.46
5. Ambulance diversions
The incidence of ambulance diversion has increased, especially in urban areas. The consequences of these diversions are significantly increased transport times, limitations on
system-wide response times, increased emergency health service system costs, risk of traffic accidents and potential for poor clinical outcome. Patients suffer the
inconvenience of discontinuity of care from their usual medical provider and separation from their medical record. Patients' families often have to travel extra distances to visit.
Paramedics may be tempted to misrepresent their evaluation of the patient in order to avoid a "redirect."47 Of greater concern, when hospitals declare "redirect status," the
system relies on the field assessment by a paramedic that the patient's condition permits the longer transport to another facility.18
6. Violence
Violence in the ED is of increasing concern. A recent survey of health care workers in the ED revealed that 84% of respondents reported witnessing verbal abuse at least once
per shift in the year before the survey. More than 20% recalled physical threats over 20 times in the year and over 50% had been physically assaulted.48,49 ED overcrowding, long
patient waits, high-stress illness and the noisy environment of the ED are felt to be factors that contribute to violence.
7. Decreased physician productivity
The many causes of ED overcrowding have had a contributory, cumulative and negative effect on physician productivity.21,50-52
Proposed solutions
ED overcrowding is a multifactorial problem, and potential solutions will of necessity be complex, expensive and undoubtedly debated.
It is apparent to emergency physicians that the long-term solution to the problem of ED overcrowding has the essential and fundamental requirement of a paradigm shift in the
relationships of government, regional health boards and hospital administrations with the specialty. EDs need to be better understood and better supported. Emergency
physicians must have a voice. Those who work in the ED have a clear perspective and a genuine desire to work toward the common goal of a high standard of care for our
patients, a standard that is threatened by overcrowding. This is not a monetary issue for us; it is a matter of patient advocacy.
This having been stated, there are some clear initiatives that will help to relieve overcrowded EDs.
1. Increase the capacity to provide inpatient, critical care and long-term care beds
"ED overcrowding is primarily the result of a shortage of inpatient beds, not a lack of ED capacity. When a hospital has enough inpatient capacity to promptly meet the needs of
seriously ill or injured patients, ED overcrowding does not occur."25 The number of acute and long-term care beds available to the citizens of Ontario must be increased.
There also needs to be better bed management within individual hospitals. There are a number of well elucidated measures that can be taken to address the roadblocks to
prompt transfer of admitted patients to the floors.4,28
2. Expand the supply of qualified emergency nurses
There must be an expansion of full-time positions for emergency nurses across the province. Part-time and casual positions threaten skill retention, clinical judgement and the
ability to function as an integral member of a resuscitative team. There is an absolute requirement for clinical nurse educators to ensure adequate assessment and resuscitative
skills for maintenance of competence.
3. Develop recruitment and retention initiatives for emergency physicians
There is a shortage of trained emergency physicians in the province, and the current cadre is in constant threat of reduction because of job stress and burnout.
As of January 1999 there were 119 Royal College certified emergency physicians in the Province of Ontario. The College of Family Physicians of Canada reported that there were
353 family physicians with the Certificate of Special Competence in Emergency Medicine (CCFP[EM]) in Ontario. Therefore, 472 certified emergency physicians staff 181 EDs in
the service of 10 million citizens; clearly, more needs to be done.53
A coordinated human resources plan for emergency medicine is a necessity. There must also be a meaningful increase in the number of positions for postgraduate training in
emergency medicine.
Alternative Payment Plans in Ontario have been a stabilizing influence on the human resources component of ED service. They must, however, be carefully developed with a view
to competitive remuneration and a "wellness" package to assist in the retention of emergency physicians.54
4. Informatics
It is clear that media reports are an insufficient basis for the development of public health policy. Quantitative data are needed to characterize the magnitude and the extent of
the problem. Currently, these data either do not exist or are not retrievable. This deficiency must be addressed.
5. Encourage a review of the need, desirability and requirements of fast-track and observational units for all EDs
Many urban EDs have initiated fast-track programs, and others have introduced observation units. These programs have demonstrated an ability to improve patient flow (with
significant reductions in ED patient LOS), reduce the percentage of patients who leave without being seen, and improve patient satisfaction, often at lower overall costs.5,55-59
Both of these concepts may achieve some efficiencies in ED care and in-hospital bed utilization. Further study is required as to the desirability and the requirements for the
institution of such programs in Ontario's EDs.
6. Encourage a further review of ambulance service provision
In rural hospitals in particular, inter-hospital facility transport poses a barrier to timely, quality care for the acutely ill and injured. This can lead to delays in service provision and
ED overcrowding in smaller emergency units. The relative shortage of advanced radiological services, such as CT scanners, in rural areas means that patients must be
transported to tertiary centres. Despite a decade of study, the issue of inter-hospital facility transport remains unsolved.
In urban areas, the terms "Redirect Consideration" and "Critical Care Bypass" have become part of the day-to-day lexicon of urban emergency care. There is evidence that the
frequency of ambulance diversion has increased with the hospital restructuring of the past half decade. Ambulance diversion, at best, equates with patient discomfort and
inconvenience and at worst leads to poor patient outcomes. This issue was recently highlighted, and an approach elucidated by ACEP.60
Conclusion
Emergency department overcrowding in Ontario is not a new problem; neither is it limited to urban centres, a product of the flu season or secondary to inadequate access to
primary care. It has numerous negative consequences on the quality of patient care. There is a national and international body of knowledge that defines the causes and
outlines potential solutions.
The problem can be solved but this will only happen if emergency health care providers are given adequate opportunity to provide meaningful input to potential solutions.
The public views ED overcrowding as a symptom of a health care system in crisis, as the proverbial "canary in the mine." It is time for the restoration of the public's confidence
in the emergency health care system. It is time for the government, hospitals and emergency health care providers to work cooperatively to relegate ED gridlock to that of
an historical anomaly.