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Can Health Care Make Society More Productive?

Posted: 01/03/2013 4:21 pm

The road to reviving Canada's sluggish productivity may lead straight to an emergency department -- or an operating room -- or an immunization clinic.

Sound implausible? Only if you consider public health care from the tired and usual point of view -- which is that it is a consumption good, sucking ever-larger amounts of money out of a shrinking taxpayer pocket. Strike another commission, Canada.

But if you can accept the notion that public health care, if optimized, could be an investment good yielding future wealth as opposed to a consumption good using up current wealth and resources, the road to reversing our productivity slide seems suddenly to be freshly-paved.

Take a pass on the commission, Canada. Take a progressive look at public health care.

Health care is a form of human capital. Considered in the broadest sense, health care encompasses public education and prevention services as well as the delivery of care when illness strikes. As such, it is actually one of society's critical means of keeping our population productive.

The correlation between health and productivity has been illustrated in different ways. The Canadian Institutes of Health Research estimated the outbreak of severe acute respiratory syndrome (SARS) in 2003 took US$3.6 billion out of Canada's GDP and 1 per cent off its economic growth. Imagine the consequences -- both economic and human -- had SARS gone unchecked.

More recently, the Fraser Institute estimated that work-time productivity losses due to long waits at hospitals and to see specialists cost the Canadian economy C$1.08 billion in 2011. The cost tripled to $3.29 billion when time outside of the working period was included.

These examples are at the system level. Think of the value impacts, as well, at the individual level: having a worn-out joint replaced or having a heart attack treated can allow people to remain productive for years beyond what would have been their original "shelf life."

Canadians can't afford productivity losses. We've had two decades of sluggish productivity growth. The Conference Board of Canada reported last year that our productivity level has fallen to 80 per cent of the U.S. level from a high of 90 per cent in the mid-1980s.

If we can agree that efficient health care is an enabler of productivity and that productivity is key to wealth, the next steps should be easy: first, view public health care as a significant driver of our economy; next, consider our expenditures in health care as a potential investment yielding future wealth; and finally, manage those investments strategically to ensure we get maximal value for our money.

The latter will take much effort given the inefficiencies in public health care in Canada.

This would be a cathartic and defining shift for Canadians, who have been locked in a philosophical debate over public vs. private health care. In fact, the core issue should be how to get maximal value for all of our health dollars. This is not about spending more or spending less; it's about investing for value.

"Show me the value" should be the new mantra in public health care. Indeed, it seems to be gaining traction.

The premiers last year created a Working Group on Health Care Innovation to "enhance patient care and improve value for taxpayers." Ontario's government this year announced an action plan that will shift funding to "where we get the best value."

This summer, Alberta's health care agency, Alberta Health Services, launched its first group of Strategic Clinical Networks, a new concept in public health care in Canada. They will bring together medical practitioners, patients, business people, researchers and others in teams that conceive and carry out projects aimed at improving health care services to achieve outcomes for all Albertans and generating measurable value for the public money invested.

We appear to be finally moving away from viewing public health care as an economic burden.

The new view emerging is that of an extremely valuable asset -- an asset that is a big part of the economy and can be managed better and exploited more fully by drawing on the bright minds, unique perspectives and special skills that exist in the medical, business, social and academic communities.

As this asset strengthens, productivity will continue to grow and the important correlation between strategic health care investments and our economy will become abundantly clear.

Loading Slideshow...
  • Smoking Rates Among Genders

    Smoking rates for both men and women have fallen over the last decade. Rates for men fell from 28.1 per cent in 2001 to 22.3 per cent in 2011 and for women, from 23.8 per cent to 17.5 per cent.

  • Smoking Among Teens

    Since 2001, the largest smoking decline for both sexes occurred among teens. Young people aged 15 to 17 saw rates falling from 20.8 per cent to 9.4 per cent in 2011. And teens aged 18 to 19 saw rates drop from 33.7 per cent to 19.1 per cent.

  • Second Hand Smoke

    The proportion of non-smokers aged 12 and older who were regularly exposed to second-hand smoke at home declined from 10.6 per cent in to almost half at 5.5 per cent in 2011.

  • Fruits And Vegetables

    In 2011, 40.4 per cent of Canadians aged 12 and older reported that they consumed fruit and vegetables five or more times per day. This was down for the second year in a row from the peak of 45.6 per cent in 2009.

  • Physical Activity

    In 2011, 53.8 per cent of Canadians were at least 'moderately active' during their leisure time, up from 52.1 per cent the year before. 'Moderately active' would be equivalent to walking at least 30 minutes a day or taking an hour-long exercise class at least three times a week.

  • Overweight

    At least 60.1 per cent of Canadian men, about 7.6 million, and 44.2 per cent of women, roughly 5.6 million, had an increased health risk because of excess weight. These rates have remained stable since 2009.

  • Obesity

    In 2011, 18.3 per cent of Canadians aged 18 and older, roughly 4.6 million adults, reported height and weight that classified them as obese. This rate was unchanged from 2009. <br>Between 2003 and 2011, obesity rates among men rose from 16 per cent to 19.8 per cent, and among women, from 14.5 per cent to 16.8 per cent.

  • Heavy Drinking

    In 2011, 19 per cent of individuals aged 12 and over reported heavy drinking, up from 17.3 per cent in 2010. Heavy drinking increased for both sexes. The proportion among males rose from 24.8 per cent to 26.8 per cent and among females, it rose from 10.1 per cent to 11.4 per cent. <br> Heavy drinking refers to consuming five or more drinks per occasion and at least once a month during the year prior to the survey.

 
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The road to reviving Canada's sluggish productivity may lead straight to an emergency department -- or an operating room -- or an immunization clinic. Sound implausible? Only if you consider public...
The road to reviving Canada's sluggish productivity may lead straight to an emergency department -- or an operating room -- or an immunization clinic. Sound implausible? Only if you consider public...
 
 
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04:03 PM on 01/04/2013
411 500 patients in Canada suffer from myalgic encephalomyelitis a potentially severe and disabling disease also known as chronic fatigue syndrome. This sick population doubled from 2001 to 2010 amd yet there is nearly 0$ spent by Health Canada in research. ( 6cents per patient per year for the last 10 years-compare this to 400$ per patient per yearfor Parkinsons disease) Stigma is really high. This is not a disease due to laziness or lack of drive. This disease is just as disabling as end stage AIDS, progressive MS or congestive heart failure. Do not get fooled by the name. Cost to society is measured in billions.

i was in my prime years when I got sick in 2008, productive and fully engaged in my community. Now,
i wait every month for a check in the mail.
02:25 AM on 01/04/2013
Health care is a valuable part of our economy. Companies considering coming to Canada see the Government health plan as a plus. That said, your argument seems to be mixed up.

You seem to be saying that improving health care will increase production. But in the period you are referencing health care became more accessible and productivity dropped.

Their is no reason to believe the two are connected. but there is also no reason to believe that improving health care would improve productivity. There are very likely many other factors at work that affect productivity.

One such might be that most people feel secure in their job and without worry that they might be terminated tend to not put as much effort into it as they might. Might also mean that a lot of people are in jobs that do not engage their interest and again they are not motivated to put forth a lot of effort.

Personally, I think the real difference is that the American companies are investing much heavier in new technologies that increase their productivity by switching more fully to automation. I think many Canadian companies are slow to improve their infrastructure and their work force is aging as well. It is natural that we would see a difference in productivity rates as a whole.
09:39 PM on 01/07/2013
Then why is healthcare so much more costly in the US and why do 20,000 plus Americans die every year due to lack of healthcare?

Although it varies by state, few working Americans enjoy such benefits as paid paternity and long term maternity leave, paid vacation and holidays and overtime pay afforded to Canadians.
06:08 PM on 01/03/2013
I don't see all this health issues causing lack of productivity and "shelf life". In the private sector people are put on the shelf in their mid fifties no matter how healthy or fit they are, and most people don't have any or very few health issues yet. Once you are thrown into the retirement pond where you can swim for 40 years if you live until 95, then you have plenty of time to visit the doctors and sit on waiting lists, any care you get or don't get doesn't affect any productivity.
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04:41 PM on 01/08/2013
In terms of their contribution to society? A healthy person who has received timely medical care is obviously more likely to benefit society, regardless of age, than someone who is sick and on bed rest...

And what shelf are people being placed on in their 50's? Disability? Exactly. Timely medical care will undoubtedly increase productivity (if you understand productivity to mean wellness, quality of life and benefit to society).