Fraser Institute on Health Care in Canada and Sweden: Selective Evidence, Even More Selective Conclusions

In this guest post, Ronald Labonté discusses a recent report from the Fraser Institute which compares the healthcare systems of Sweden and Canada. While the report aims to promote the privatization of the Canadian healthcare system, Labonté argues that its conclusions are ideologically driven and that the evidence it draws on must be considered in the wider sociopolitical context of both countries.  Labonté holds a Canada Research Chair in Globalization and Health Equity at the Institute of Population Health, and is Professor in the Faculty of Medicine, University of Ottawa; and in the Faculty of Health Sciences, Flinders University of South Australia. 

The May 22, 2013 report from the Fraser Institute comparing Swedish and Canadian health systems is interesting, provocative and another example where ideology trumps evidence.

The Fraser Institute is a well-known Canadian conservative think tank that emphasizes small government, market fundamentalism and individual choice in its policy arguments. This does not detract from its report’s findings that Sweden’s health system generally performs better and for a lower expenditure of its GDP than does Canada; or that Sweden allows some private insurance to co-exist with its public system (between 2% and 4% of Swedes opt for such coverage), some small co-payments in its public system (with exclusions for those who find it difficult to pay), and a few privately managed hospitals. On this evidence, the report robustly concludes that Canada should therefore increase private provision of hospital and surgical services, allow private insurance to compete with its public system, and to introduce co-payments (user fees) for all health care.

In doing so, the report ignores that Canada already has a large private health insurance system for non-publicly insured health care. Its private health care expenditure (about 30% of total spending) far exceeds that paid by Swedish citizens (about 15%), partly because Sweden provides free or heavily subsidized dental care and prescription pharmaceuticals, which most of Canada does not. The report also ignores the context in which Sweden’s small medical and hospital co-payment policy exists: a high tax/transfer and high public spending social welfare state, still far outperforming Canada in health, poverty, unemployment and other key social indicators. In this context small out of pocket payments do not pose the same barrier to health care access that they might if transferred to a country like Canada, which ranks very low in the OECD league table for tax/transfers and social spending. One cannot cherry-pick an ideologically convenient public policy out of a total social welfare package.

Finally, that Sweden spends significantly less of its GDP on health care than Canada while outperforming on many health system and health outcome measures, may well be related to its physicians being salaried and much primary care being delivered by nurses. Though noting this, the Fraser Institute report simply concludes that these policies ‘will not work in Canada’ due to ‘a lack of physicians and an independent practitioner model of delivery.’ Whether Canada has a substantial lack of physicians is moot; but the report is silent on the nurse-centered, team-oriented approach to primary care that helps keep Sweden’s health care costs low and which would obviate much of the claimed doctor shortage in Canada. Although shifting some of the budgetary measures for hospitals (from global to activity based financing) may merit consideration, how increasing private sector provision, private financing and user fees would reduce Canada’s annual health care spending, and not launch us further along the American pathway of excess costs for limited returns, is never explained. In sum, the Fraser Institute’s recent report may make for some interesting reading, but with eyes critically wide open.


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