Monday, October 05, 2009

Pricing waiting 

Gary Gross sends me a link to a chart showing how long wait times are in Canada for a variety of procedures, and how much you'd have to pay for a private-market alternative, which I've placed to your right. This chart seems very interesting as an economic study -- if this is the supply curve of private services and there's a public "free" option, what does this chart say about the demand for health care services? You have the time saved, and there is information on how many more QALYs each of these presents. Wouldn't you like to have information like this on demand for QALYs rather than just supply?

Unfortunately, if you live in many parts of Canada, you don't get to make those choices. So you use a broker.
Enter Rick Baker, a Canadian determined to improve health care in his country. Baker joined Gilbert Monday at a Vancouver hotel to speak with American reporters as part of a health care dialogue organized by the Colorado-based Independence Institute, a free market think tank where I am a public policy analyst.

Baker began by offering a blunt disclosure. �I make my living sending patients to the U.S.,� he said. �This is medical tourism, but instead of sending someone to Thailand, we�re sending them to Delaware.�

Through an innovative partnership with 22 independent American surgery centers and doctors in 13 states, Baker and his American counterparts transport Canadians to the U.S. for timely care at cost savings up to 80 percent. The partnership operates largely outside the traditional health insurance system. And this isn�t just about helping Canadians. Baker now also provides a similar state-to-state service for Americans seeking more affordable or timely care.

Under Canada�s controversial federal health legislation, surgeons are prohibited from charging patients to provide �medically necessary� treatment. In addition, they are limited to performing surgeries to six hours a week. Gilbert recalled one surgeon telling her, �I spend six hours in surgery each week, less time than I spend explaining to sick patients why I can�t perform theirs.�
Had I waited 3 years for my gall bladder removal, there's a pretty good chance I would not be typing this now. A friend of mine's wife became ill on Friday and they were planning a long trip outside the country in a few weeks. If they did not get the surgery for her quickly, their plans would have been canceled. No doctor in St. Cloud was available to do it this week, so they are driving up the road to get this done. Were they in Canada, they probably do not have the option.

Baker notes that his country's system treats certain things very well. Routine care for pregnancy or for a broken leg is fine. The question is how a system deals with the not-routine. And in those cases, wouldn't you want a system allows consumers to incentivize production versus a system of command and control?

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