A new report from the Montreal Economic Institute (MEI) estimates that allowing Canadians to purchase private insurance for basic health care services covered by public plans could lead to double-digit reductions in patient wait times, based on policies enacted in similar countries.
Duplicative Insurance Could Boost Capacity
The report, released Thursday, urges provincial governments to scrap legal barriers to duplicative private health insurance. This would allow patients to use private coverage for publicly insured procedures, including faster access at private hospitals and clinics.
“Allowing duplicate insurance to cover privately delivered medically necessary services … would formalize and broaden access to timely care while facilitating investment in private infrastructure, thereby increasing overall healthcare system capacity,” writes the report’s author, Conrad Eder, an associate researcher at MEI.
International Examples Show Promise
The report notes that Denmark and Australia have already seen positive results from expanding duplicative insurance. Both countries, like Canada, maintain universal, taxpayer-funded health-care systems.
In Denmark, the increasing use of private health insurance and private hospitals coincided with a 36.7 per cent reduction in surgical wait times between 2001 and 2011.
In Australia, the provision of duplicative insurance, known domestically as “hospital cover,” has coincided with steady growth in the number of private hospital beds and modest reductions in public hospital wait times. Australia’s private hospitals now cover more than 40 per cent of all hospital admissions and deliver approximately 70 per cent of elective surgeries. Approximately 45 per cent of Australians hold “hospital cover” insurance policies, with typical monthly premiums ranging from $84 to $293 in Canadian dollars.
Legal Barriers in Canada
Duplicative insurance is not explicitly prohibited under the federal Canada Health Act. However, six provinces functionally ban it for core health services. This includes British Columbia, Alberta, Ontario and Quebec, which allows a partial exception for cataract extractions and hip and knee replacements.
Market Viability Depends on Private Capacity
Emmanuelle Faubert, MEI’s lead health policy researcher, said that the viability of duplicative insurance in the Canadian market will largely depend on the expansion of private health services.
Faubert says that provinces that allow private medical practice, such as Alberta and Quebec, currently do so in too limited a capacity to sustain a robust, competitive market for private insurance.
“You need a large, diversified pool of premium-paying policyholders for the private insurance market to survive and thrive,” said Faubert. “Realistically, this isn’t going to happen if you only allow private hospitals to perform a small number of elective procedures.”
