Early in 2012, the Ontario government will begin hammering out a new deal with the province's doctors.
It's a pivotal opportunity to shift toward a more sustainable model of health-care spending. So hopefully, the report delivered Monday by Auditor-General Jim McCarter will remind Dalton McGuinty's Liberals – and the health officials under their watch – to do their homework first.
Among Mr. McCarter's various findings, the section on how the province pays family doctors stands out as a well-timed cautionary tale.
Since 2005, Ontario has made a concerted effort to shift doctors from fee-for-service to "capitation," which sees them paid an annual fee for each patient. By providing financial incentives for doctors to join "family health teams," Mr. McGuinty's government has aimed both to improve access for patients and to provide itself with more cost certainty.
By some measures, the initiative has been a success. Large numbers of doctors have made the shift. And by the government's estimate, that helped to increase by at least 500,000 the number of Ontarians who have a family doctor.
But Mr. McCarter also found some major holes in the model that the government created. Doctors are paid for patients who are "enrolled" with them, even if those patients don't make any visits – so by the auditor's calculation, they received $123-million in 2009-10 for treating people they never actually saw. Meanwhile, there appears to be leeway and incentive for doctors to de-enlist patients with medical conditions that require frequent visits, then shift them back to the fee-for-service model.
Examples like those help explain why, at a time when health spending is threatening to eat the rest of the provincial budget, doctors are reportedly earning 25 per cent more under capitation than they were under fee-for-service. Not coincidentally, total annual funding to family physicians went up by 32 per cent between 2006-07 and 2009-10, from $2.8-billion to $3.7-billion. And despite the higher costs and the ostensibly improved access, the health ministry was unable to provide any evidence that wait times for physicians have gone down.
None of this is to say that the shift away from fee-for-service has necessarily been a mistake. To some extent, there will always be oversights and unintended consequences that require adjustments when governments go down new paths.
But it's not too much to ask that governments try to minimize those growing pains, by having a clear sense of what they're aiming for and keeping close tabs on whether they're achieving it. And that doesn't appear to have been the case here.
By Mr. McCarter's account, his office asked the provincial health ministry if it had conducted an "in-depth analysis of the anticipated costs" of the new funding model before entering into negotiations with the Ontario Medical Association. The ministry responded that indeed it had, but then proved "unable to locate this analysis."
If we're being generous, it bears noting that in 2005, economic growth was relatively strong and the province wasn't far from budgetary balance. Improving health care, then as always, was a political imperative. But the idea that costs had to be contained, or else the entire system was in jeopardy, hadn't yet taken hold.
But heading into 2012, the province is fast running out of room for error. The path out of a $16-billion deficit, more or less endorsed by all three provincial parties in the recent election, revolves largely around flattening health spending increases – not many years down the road, once all the kinks in new policies have been ironed out, but pretty much as soon as those policies are implemented.
In other words, Mr. McGuinty's government had best have a clear sense of what it's trying to achieve with the OMA this time. The room for error is shrinking fast.
Adam Radwanski