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SUN NEWS COLUMN: Five ideas to kick-start our economy after COVID-19

Coming out of the COVID-19 pandemic, Canada is going to be facing a recession. Potentially, a very deep one.

Unemployment will be high and many businesses will continue to shut their doors for good. Companies that do survive the pandemic, as well as a majority of Canadians, will be tapped out financially. Heading into the pandemic, accounting firm MNP reported that 46% of Canadians were within $200 at the end of each month from insolvency.

Tax hikes could be catastrophic for many households and businesses. And yet, government cost pressures will be immense.

Beyond the mountains of debt governments are incurring right now, they’ll have serious health-care bills to pay. Don’t forget, our health-care system put thousands of procedures on hold as COVID-19 arose and the first of the baby boomers will hit 75 years of age next year — entering an age bracket where health-care costs rise by a third on average.

So what can governments do to spur economic growth without spending money? Lots. Here are five examples:

First, they could find a way to get natural resource projects off the ground. SecondStreet.org made a list of stalled or cancelled oil and gas, and mining projects since 2014 and the total value was equivalent to the cost of building an NHL-sized arena every single day for a year. Just imagine how many jobs we could create if governments even salvaged a fraction of those projects.

Tearing down internal trade barriers is another enormous opportunity. These are barriers that make it difficult for businesses to operate in other parts of Canada. For example, should a long-distance bus really have to change trailer hitches when it arrives in another province? A Senate report includes several examples like this and notes these barriers cost our economy billions each year.

Our third idea is similar — aggressively reduce red tape in general. Since the pandemic began, governments have been busy relaxing restrictions to make it easier for businesses and the public — from allowing a restaurant to sell alcohol with your delivery order to allowing doctors to video conference with patients.

Canadian Federation of Independent Business analysis suggests unnecessary red tape costs businesses billions of dollars each year. If governments cut unnecessary red tape, they could make it easier for businesses to operate.

Fourth, health reform. Under Canada’s monopolistic health-care model, we trail the developed world when it comes to doctors, hospitals beds and equipment per capita. The government could increase capacity and take pressure off our public system by allowing private clinics to provide the same procedures as the public system. This would also allow many of the hundreds of thousands of Canadians who go abroad each year for health care to instead spend those dollars in Canada. More jobs created. More patients helped.

Finally, now would be a good time for governments to curtail their expenditures. Governments could focus their spending on priorities, such as health care instead of public art and other non-priorities. Public sector bodies could experiment with “work from home” models for employees to reduce office costs and reduce compensation levels — just like many working outside government received.

These are just some ideas to get Canada up and running again. If governments try the opposite — more borrowing, more intervention and higher taxes — prepare for a much longer recovery period than necessary.

Colin Craig is the President of SecondStreet.org, a new Canadian think tank.

This column appeared in the May 4, 2020 edition of the Calgary Sun, Edmonton Sun, Winnipeg Sun, Toronto Sun, and Ottawa Sun.

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Prevention – reduce demand in the first place

If Canadians lived healthier lives, we could reduce demand for emergency services, orthopaedic surgeries, primary care and more. 

For instance, if you visit the Canadian Cancer Society’s website, you’ll read that “about four in ten” cancer cases are preventable. The Heart and Stroke Foundation notes that “almost 80 percent of premature heart disease and stroke can be prevented through healthy behaviours.” A similar number of Diabetes cases are also preventable. 

Many joint replacements and visits to ERs and walk-in clinics could also be avoided through healthy living. 

To be sure, not all health problems can be avoided through healthy living – everyday the system treats Canadians with genetic conditions, helps those injured in unavoidable accidents and more.  

But there is an opportunity to reduce pressure on the health care system through Canadians shifting to healthier lifestyles – better diets, more exercise, etc. 

To learn more, watch our Health Reform Now documentary (scroll up) or see this column. 

Partner with non-profits and for-profit clinics

European countries will partner with anyone who can help patients. 

It doesn’t matter if it’s a non-profit, a government entity or a private clinic. What matters is that patients receive quality treatment, in a timely manner and for a competitive price.  

In Canada, governments often delivery services using government-run hospitals instead of seeing if non-profit or private clinics could deliver the services more effectively. 

When governments have partnered with non-profit and private clinics, the results have often been quite good – Saskatchewan, Ontario and British Columbia are just a few examples of where partnerships have worked well. 

Canada should pursue more of these partnerships to reduce wait times and increase the volume of services provided to patients.  

To learn more, watch our Health Reform Now documentary (scroll up) or see the links above. 

Make cross border care more accessible

In Canada, citizens pay high taxes each year and we’re promised universal health care services in return. The problem is, wait times are often extremely long in our health system – sometimes patients have to wait years to see a specialist or receive surgery. 

If patients don’t want to wait long periods, they often have to reach into their own pocket and pay for treatment outside the province or country. 

Throughout the European Union, we also find universal health care systems. But a key difference is that EU patients have the right to go to other EU countries, pay for surgery and then be reimbursed by their home government. Reimbursements cover up to what the patient’s home government would have spent to provide the treatment locally. 

If Canada copied this approach, a patient waiting a year to get their hip operation could instead receive treatment next week in one of thousands of surgical clinics throughout the developed world. 

Governments benefit too as the patient is now back on their feet and avoiding complications that sometimes come with long wait times – meaning the government doesn’t have to treat those complications on top of the initial health problem. 

To learn more, watch our Health Reform Now documentary (scroll up) or this shorter video. 

Legalize access to non-government providers

Canada is the only country in the world that puts up barriers, or outright bans patients from paying for health services locally. 

For instance, a patient in Toronto cannot pay for a hip operation at a private clinic in Toronto. Their only option is to wait for the government to eventually provide treatment or leave the province and pay elsewhere. 

Countries with better-performing universal health care systems do not have such bans. They allow patients a choice – use the public system or pay privately for treatment. Sweden, France, Australia and more – they all allow choice. 

Why? One reason is that allowing choice means some patients will decide to pay privately. This takes pressure off the public system. For instance, in Sweden, 87% of patients use the public system, but 13% purchase private health insurance. 

Ultimately, more choice improves access for patients. 

To learn more, watch our Health Reform Now documentary (scroll up) or watch this short clip on this topic. 

Shift to funding services for patients, not bureaucracies

In Canada, most hospitals receive a cheque from the government each year and are then asked to do their best to help patients. This approach is known as “block funding”. 

Under this model, a patient walking in the door represents a drain on the hospital’s budget. Over the course of a year, hospital administrators have to make sure the budget stretches out so services are rationed. This is why you might have to wait until next year or the year after for a hip operation, knee operation, etc. 

In better-performing universal health systems, they take the opposite approach – hospitals receive money from the government each time they help a patient. If a hospital completes a knee operation, it might receive, say, $10,000. If it completes a knee operation on another patient, it receives another $10,000. 

This model incentivizes hospitals to help more patients – to help more patients with knee operations, cataract surgery, etc. This approach also incentivizes hospitals to spend money on expenses that help patients (e.g. more doctors, nurses, equipment, etc.) rather than using the money on expenses that don’t help patients (e.g. more admin staff). 

To learn more about this policy option, please watch our Health Reform Now documentary (scroll up) or see this post by MEI.