AB Premier Smith hints at user fees, co-pays, privatization for health care

AB Premier Smith hints at user fees, co-pays, privatization for health care

Answers to the major problems confronting Alberta’s health care system, Daniele Smith said in a paper published under her name last year, are found in user fees, co-pays, privatization, and slyly delisting services covered by health insurance by redefining them. 

The paper – entitled Alberta’s Key Challenges and Opportunities – was published by the University of Calgary’s right-leaning School of Public Policy in June 2021.

At the time the paper was published, Alberta’s new premier was still president of the Alberta Enterprise Group, a pro-business advocacy organization with extensive ties to the province’s conservative parties, past and present.

Apparently unreported by media, the paper was spotted recently by economics blogger Bob Ascah, a retired senior Alberta Treasury Department civil servant and former director of the Institute for Public Economics at the University of Alberta. 

The paper begins with the fatuous claim Albertans are culturally different from other English-speaking Canadians and an amateurish potted history of the province intended to suggest our supposedly entrepreneurial character and business mindset are at the root of this allegedly unique character.

Naturally, given her long-held market-fundamentalist ideology, Smith sees government as the root of all economic problems, complaining that the challenges faced by Alberta Health Services came about because “we had a bureaucracy who followed the crowd and lazily took the path of least resistance, locking down the entire economy and blaming Albertans for not doing enough to avoid getting sick.”

This is not merely tendentious. It is categorically false.

Nevertheless, now that we are getting to know her better, it seems possible at least that Smith actually believed this when she wrote it. 

This drivel soon leads to the real point of the exercise, however: advocating health care policy prescriptions like the privatization schemes and minuscule health spending accounts that were mentioned in her United Conservative Party (UCP) leadership campaign.

Despite its obvious flaws of scholarship, Smith’s paper is illuminating because some of her worst ideas are sketched out in a more detail than we have seen hitherto.

Smith was obviously working on this well before it was known that there would be a campaign for the UCP leadership, let alone that she would be in it. 

The paper rightly diagnoses the core problem with Alberta’s finances: that we’re stuck on the proverbial royalty price roller coaster. 

However, Smith immediately goes on to claim: “We want gold plated services and we don’t want to pay any more taxes for them.”

Whether or not basic health care services in Alberta are “gold plated” is another matter entirely, but it is true that Alberta conservative governments have relied on inherently unstable resource revenues to pay for services that should be covered by taxes, although Smith clearly doesn’t see raising taxes as the ideologically correct answer. 

So what’s the path forward, according to Smith, as expressed in her paper?

Well, to start with, “reinventing government” to be more like a for-profit corporation.

She calls for Alberta immediately to “permanently wean Albertans off their energy royalty dependence,” claiming that a combination of spending cuts and investment revenue generated by the money saved would clear away Alberta’s deficits.

Now, this was written well before Smith was in a position where she needed to buy Albertans’ votes with their own money, so it’s fair to say her proposed spending cuts won’t see the light of day, at least unless the UCP manages to eke out reelection. 

“The next step in closing the gap” in health care funding, she continues after several pages of numbers that show signs of being processed with the assistance of a professional number-cruncher of the sort she would have worked with as a Fraser Institute apparatchik, “is to generate $4 billion from new user fees.”

“We can no longer afford universal social programs that are 100 per cent paid by taxpayers,” she argues. “The only option is to allow people to use more of their own money to pay their own way and to use the power of innovation to deliver better services at lower cost.” (Don’t hold your breath for the second part of this idea ever to be realized.)

The next paragraph explains what Smith means when she talks about a “patient-centred” health care system, as she does constantly. Just as “choice” means paying for access, “patient centred” doesn’t mean quite what it sounds like either. 

“What the government needs to do is create matching Health Spending Accounts for all Albertans,” she explains. “The Government should pledge to match up to $375 per person and challenge individuals and employers to do the same.”

“By taking responsibility for their health and giving people the means to do so,” she burbles, “it should translate into less pressure on the hospital system and better chronic care management which will bring costs down.” 

Better, she continues, “once people get used to the concept of paying out of pocket for more things themselves then we can change the conversation on health care. 

Instead of asking what services will the government delist … we would instead be asking what services are paid for directly by government, and what services are paid out of your Health Spending Account. (Which only amounts to $375 a year, remember.)

My view is that the entire budget for general practitioners should be paid from Health Spending Accounts,” she continued. “If the government funded the account to $375 a year, that’s the equivalent of 10 trips to a GP, so there can be no argument that this would compromise access on the basis of ability to pay.”

(I await responses from genuine experts – distrusted though they may be by the Smith Government – as to how likely this claim is to play out as predicted.)

“But we could take it one step further,” Smith confidently continues. “I think is (sic) time to redefine universality. … If we establish the principle of Health Spending Accounts, then we can also establish co-payments.”

Before we go further, Dear Readers, I urge you to speak with an American friend or relative about what they think of co-pays, as these fixed out-of-pocket payments required before health insurance can be accessed are known south of the Medicine Line. 

“It doesn’t need to be onerous, and it could be on a sliding scale,” Alberta’s future UCP premier says reassuringly. 

“I don’t believe Albertans are willing to pay one penny more for an underperforming health system and watch their dollars evaporate without any improvement in performance,” she then asserted, tendentiously. “I’m willing to bet most Albertans would be willing to pay up to $1,000 if it would reduce waiting times on vital treatments for themselves or a family member.”

Smith then moved on to “reengineering” the way services are delivered. After a shot at the idea of public services, she confidently states, “the only way to make substantial and significant changes in the way programs are delivered is to allow contracting out, competition and choice.”

This model for health care, she explained, is how the government now runs education in Alberta – with charter schools, private schools, and home schooling not just tolerated, but actively encouraged by the UCP. 

“There should be similar options” for health care, she asserts, outlining her idea for charter hospitals, private hospitals and “home-based health care.” 

Gee whiz, she continued, we could even have “specialized birthing centres, so new moms could have a custom environment to offer the most pleasant experience possible to welcome the new member of their family.” (Although not, presumably, for $375 a year, or even 10 times that.)

If you’re worried by this, Smith concluded, don’t be. “That is the beauty of entrepreneurship. Someone will conceive of a brilliant way to do things differently that will not only deliver better patient care but do it in a way that reduces the cost for all of us.”

If you believe that, of course, there are investment opportunities awaiting you in cryptocurrency, veterinary deworming paste and bridges across the mighty Peace!

NOTE: All italics in quoted passages in this post were added by me. DJC

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