1. November 30, 2004 Dr. Glen Roberts Director, Health Programs roberts@conferenceboard.ca The Fiscal Implications of What is in and out of the Medicare Basket IRPP: CAREFUL CONSIDERATION: DECISION-MAKING IN THE HEALTH CARE SYSTEM

2. www.conferenceboard.ca Presentation Overview l The Conference Board of Canada-Who We Are l Synthesis of Conference Board of Canada Literature l Key Findings from Canada l Policy Principles l Questions

3. The Conference Board of Canada Who We Are OUR MISSION… The Conference Board builds leadership capacity for a better Canada by creating and sharing insights on economic trends, public policy, and organizational performance. www.conferenceboard.ca

4. Conference Board Literature Used… www.conferenceboard.ca

5. List of Ranked Indicators Used (By Category) Health StatusNon-Medical FactorsHealth Outcomes Life expectancy l males / females Body weight Lung cancer mortality rates l males / females Disability-free life expectancy l males / females Tobacco consumption Immunization for influenza l males / females Self-reported health statusAlcohol consumption Stroke mortality rates l males / females Infant mortality rateRoad Traffic Accidents *PYLL suicide – (males) Low birth weightSulphur oxide emissions PYLL lung cancer l males / females Immunization – DTP PYLL breast cancer l males / females Immunization for influenza * Potential Years of Life Lost

6. Overall Performance Results (Weighted Medal Count) Canada www.conferenceboard.ca Source: CBoC; OECD

7. Drivers of Productivity Physical capital Human Capital Innovation Source: Performance and Potential 2003-04 www.conferenceboard.ca

8. Federal and Provincial Government Budgetary Balance($ billions) www.conferenceboard.ca Source: CBoC

9. Federal and Provincial Government Budgetary Balance($ billions) www.conferenceboard.ca Source: CBoC

10. Thinking of the issues presently confronting Canada, which one do you feel should receive the greatest attention from Canada's leaders? (Open-Ended, N=1000) Canadian Priority Issues www.conferenceboard.ca

11. Estimated Impact of Determinants of Health on the Health Status of the Population (%) Source: Canadian Institute for Advanced Research www.conferenceboard.ca

12. Key Cost Drivers and Escalators www.conferenceboard.ca l COST DRIVERS o Demographics o Consumer and Provider Expectations o Chronic Diseases o Inflation l COST ESCALATORS o Pharmaceuticals o Home Care o Health Human Resources o New Technologies l EMERGING COST ESCALATORS o Access Issues o Patient Safety o Environmental Issues

13. Real Per Capita Provincial Health Care Spending Hospitals—1981–2020 ($1997 per person) Source: Canadian Institute for Health Information; CBoC.

14. Real Per Capita Provincial Health Care Spending Hospitals—1981–2020 ($ 1997 per person) Age 0-64 Source: Canadian Institute for Health Information ; CBoC.

15. Real Per Capita Provincial Health Care Spending Hospitals—1981–2020 ($ 1997 per person) 65+ Source: Canadian Institute for Health Information ; CBoC.

16. Real Per Capita Provincial Health Care Spending Physicians—1981–2020 ($1997 per person) Source: Canadian Institute for Health Information ; CBoC.

17. Real Per Capita Provincial Health Care Spending Home Care—1981–2020 ($1997 per person) Source: Canadian Institute for Health Information ; CBoC.

18. Real Per Capita Provincial Health Care Spending Prescription Drugs—1981–2020 ($1997 per person) Source: Canadian Institute for Health Information ; CBoC.

19. Real Per Capita Provincial Health Care Spending Other Institutions—1981–2020 ($1997 per person) Source: Canadian Institute for Health Information ; CBoC.

20. Real Per Capita Provincial Health Care Spending Other Expenditures—1981–2020 ($1997 per person) Source: Canadian Institute for Health Information ; CBoC.

21. Real Per Capita Provincial Health Care Spending Other Professionals—1981–2020 ($1997 per person) Source: Canadian Institute for Health Information ; CBoC.

22. Real Per Capita Provincial Health Care Spending Other Professionals—1981–2020 ($ 1997 per person) 85+ Source: Canadian Institute for Health Information ; CBoC.

23. Total Share of Nominal Provincial Spending by Component, 2001 (2020) www.conferenceboard.ca Source: CBoC; Health Canada; Canadian Institute for Health Information

24. Total Provincial Spending on Health Care as per cent of Revenue 1989 - 2020 Source: Canadian Institute for Health Information; CBoC.

25. Cost Driver and Escalator Breakdowns Component Nominal Increases (%) Approximate Annual Increase ($ billions) Overall5.35.0 Inflation2.72.0 Demand0.90.8 Aging0.8 Population Growth0.90.8 Drugs9.30.5 Homecare8.70.2 CBoC

26. Drivers of Rising Health Benefits Costs (in descending order of impact) 1. Drug costs 2. Dental Care 3. Hospital and medical services 4. Vision care 5. Out-of-country medical coverage 6. Short- and long-term disability claims 7. Paramedical coverage (massage, chiropractic, etc.) 8. Increased utilization Source: Unpublished data from The Conference Board of Canada’s 2003 compensation planning survey. www.conferenceboard.ca

27. Health Expenditure Growth Rate Source: OECD. Average www.conferenceboard.ca

28. Key Findings for Canada l Money alone is not the answer. l Canada must do more to control escalating pharmaceutical costs. l Creating and maintaining a satisfied workforce is vital for a high-performing health care system. l Canada needs to focus more on health promotion, prevention and appropriate investments in the broad determinants of health as strategies to control health costs over the long term.

29. www.conferenceboard.ca Key Findings for Canada l The “greying” of Canada’s population does not have to result in a more expensive health care system. l Countries that have invested strategically in health related information and communications technologies (ICT) and provided training and skills development are better integrated and have a more productive workforce. l User fees/cost-sharing methods work well to control costs under certain circumstances, but may have consequences. l A publicly funded health care system with zero or low user fees needs to ensure that it has adequate surgical capacity if it wants to avoid long wait times.

30. www.conferenceboard.ca 7 Key Policy Principles for Defining the Medicare Basket: Assuming that re-defining the Medicare basket is worth the trouble….. l Get it right the first time. l Recognize current health care utilization patterns and plan based on the future needs of Canadians. l Align services with patient/client expectations. l Process used must be transparent. l Services must be necessary, effective and cost-effective. l Provide equitable funding and access. l Use International experience with technology assessment. Canada needs a NICE.

31. Questions? “The Tortoises Are Gearing Up To Run” Duncan Sinclair, Chair HSRC “I learned a lot about delisting and while I’m not sure I learned how to do it, I sure learned how not to do it.” Dorothy Pringle, U of T “If you do not know where you are going, any road will take you” Alice in Wonderland

32. www.conferenceboard.ca