It is widely known now that American President Trump has been threatening widespread tariffs on Canadian products and services, and that this would have devastating economic repercussions for many Canadians.
But what has yet to be part of the national conversation is the impact tariffs would have on our health system. And what we should do to prepare for such an outcome.
Winston Churchill’s saying, ‘Never let a good crisis go to waste’ is particularly apt. Canadians may see a crisis unfold in our commitment to sustain quality universal health care through a prolonged trade war; we should use such a crisis, should it arise, to open the door to new solutions.
What’s the connection between tariffs and our health system?
Economists have noted that a possible depression induced by tariffs would cause many Canadians to lose their jobs. Add to this the ripple effect of businesses going bankrupt because they rely on these Canadian consumers to survive. If tariffs stay in place for an extended period, widespread unemployment plus business bankruptcies would cause a precipitous drop in federal and provincial tax revenues.
Provincial spending on health care is already almost 50 per cent of all money spent by provincial governments. That always makes health care a prime target for governments trying to reduce their spending – something that would be exacerbated in a tariff-induced depression.
Yet provincial governments would have a difficult time finding ways to save money on health care as it is organized and delivered today.
Canada has more seniors than ever; Canadians are living longer with more medical problems; and recent population growth will continue to drive immense public pressure for ever-more health care. Governments in many provinces are also bound to multi-year wage increases for nurses and physician payments that in part redress recent high inflation.
And if a depression takes hold, hundreds of thousands of Canadians could also lose extended health benefits related to their place of employment, including insurance for dental and vision health, access to mental health care and coverage for prescribed drugs. Some Canadians would be forced to defer or forgo their and their families’ health needs. In some instances, this could lead to avoidable emergency department visits and hospitalizations that further crowd acute care.
Provincial and federal public drug and dental insurance programs would have to absorb many new enrollees and push up government spending.
In other words, if a prolonged trade war ensues, provincial governments will have to make tough choices. Governments will likely avoid cutting services that directly affect patients or cause longer wait lists.
The effects of government cuts on health-care austerity will not be spread equally.
Services most vulnerable to cutting include rehabilitation and mental health services, public health and prevention efforts. Organizations that promote health-care quality, standards or health information organizations will be targeted. Modernization efforts such as team-based primary care reforms will be postponed or scuttled.
So, what are the solutions?
Massive public debts and deficit financing may be the only route to ensure public access to the health-care systems we have now, taking a page from the COVID-19 playbook. Doing so would maintain health-care delivery system stability through preserving the status quo.
But if governments run massive public debts due to the high cost of health care, the public should demand fundamental reforms that improve health and well-being for all Canadians. Let’s make use of the crisis.
Crises can open the door to new solutions. Provinces have been slow to change their health-care systems over the past decades. Productivity in the health-care sector has stalled and billion-dollar electronic medical record modernizations have not realized expected efficiency gains.
Governments should be emboldened to use the crisis as a foundation for significant reforms to their health-care delivery systems.
New initiatives may include paying health-care providers to keep their population healthy rather than paying for illness care, link health with social care and housing security, and acknowledge that mental health is as important as physical health care.
A multi-year vision should incorporate flexible health care budgets that can be moved across settings, organization types and across budget years to maximize the impact of spending on Canadians’ health.
A prolonged tariff war may never come to pass, but the fractures in our health system are already profound and would be amplified if a crisis arises owing to the tariffs. We shouldn’t give up our hard-fought right to universal health care, nor the impetus to dramatically improve it.
Elbows up: we could turn such a crisis into rapid health-care reform that would benefit Canadians for generations.
Jason M. Sutherland is Professor and Director of the Centre for Health Services and Policy Research at the School of Population and Public Health at the University of British Columbia.
QUOI Media Group
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