The history of Canadian government involvement in health care financing from the earliest colonial times to the present day is briefly reviewed. Particular attention is paid to the institution of major health care insurance programs and the underlying reasons for their implementation. The current financing arrangements, as dictated by the Established Programs Financing Act of 1977, are reviewed in some detail with a discussion of the advantages and disadvantages of these arrangements.
Under the regime of public health insurance, the utilization of health cares are determined by various socio-demographic and economic characteristics of the beneficiaries. These determinants are estimated in this study where we apply the dummy variable regression technique to the AMULET data bank, a 1971 cross-section of 8,608 beneficiaries in the province of Québec where most of health cares are free. In increasing order of importance, we find that :
i) The individual utilization of health care is increasing with the age of beneficiaries and is higher for women than for the men for the age-group 15-50 years. This tendency is reversed for the age-group 50 years and older since the rate of increase in utilization is higher for men. There is, however, any significant difference in utilization on the basis of sex discrimination for the age-group 0-15 years. The structure age-sex, being of course a proxy of the health status of the beneficiaries, is the most important determinant of health cares utilization.
ii) Individual utilization depends on the income class to which belongs the beneficiary. The beneficiaries of the highest and the lowest income class utilize more health care than those belonging to the so called "middle class". Notice however that the lowest income class in the data sample is composed in majority of aged beneficiaries.
iii) The size of the beneficiaries' family is not a significant determinant of the utilization of health care for children of age-group 0-15 years. For other age-group however, utilization decreases with this family size for men, but increases for women.
iv) The geographic area where the beneficiaries are identified is a weak determinant of utilization. Beneficiaries in urban area utilize more of health care than those living in rural area.
National health insurance was implemented in Quebec in late 1970. Previously reported surveys carried out in Montreal in 1969-70 and 1971-72 showed that while there was no change in overall volume of services, there was a redistribution, with increases among the poor and decreases among the wealthy. We conducted a survey in late 1974 to determine the "steady-state" impact of l’assurance-maladie on social class differences in health care utilization. In a socially heterogeneous area of Montreal 1,559 households were surveyed. When reported morbidity status was taken into account, physician visit rates in the past two weeks were 21.6 per cent, 20.2 per cent, and 20.4 per cent in low, middle and high economic classes respectively, confirming the disparity of access has been reduced. However, relative to the non-poor, the poor still made considerable use of hospital clinics and emergency rooms for primary care and more of their visits entailed prescriptions and physician-initiated requests to return. The latter may indicate that the poor still consult the doctor for more advanced conditions than the non-poor. There is no evidence of abuse of "free" medical care by the poor. In contrast to the equalization in use of physician services, dental services are still unequally distributed, although compared with the 1969-70 and 1971-72 surveys, utilization rates were higher in 1974 in all social classes. The overall increase in per capita physician visits was confirmed by statistics of the Régie de l’assurance-maladie du Québec. A parallel increase in the supply of physicians kept the workload of the average physician at a constant level.
The object of this paper is to analyse the effects of insurance and of the relation of trust between consumer and producer on the possibilities of fraud by the producer. Fraud is defined as the provision of unnecessary services to a consumer who does not possess full information about the quality of his purchase. The possibilities of fraud increase with insurance. In particular, they are very high with full insurance since real cost of search tends to infinite. Also we verify that good trust between consumer and producer limits search activities.
We apply this model to the market of surgeons in the United States. This market reflects the main characteristics of the model: the consumer is not well informed, the relation of trust is important, the cost of search is high, the service is largely insured and there is excess capacity.
Designed to contribute to an assessment of the effects of the second agreement with general practitioners, the study analyzes the effects produced on the medical practices of general practitioners by pay range of a) the individual income ceiling and b) various types of fee restrictions on supplementary medical procedures provided under the agreement.
The methodology used consisted basically in analyzing the variations of selected indicators of professional activity and medical practice among general practitioners by pay range following the implementation of the second agreement. Control groups were used to facilitate the assessment of other factors that may have influenced the variations referred to.
The study shows that the income ceiling has resulted in a significant slowdown in the professional activity of general practitioners whose income had been in excess of the income ceiling in the year preceding the agreement. The shorter work period was accompanied by a longer vacation period.
From the second part of the study it appears that the implementation of the second agreement has also appreciably reduced differences in medical procedures by pay range. The fee restrictions on supplementary procedures have produced a very considerable drop in the number of supplementary procedures performed by general practitioners in the top pay ranges, whereas in the past such procedures had been particularly prevalent in those pay ranges.
Having demonstrated that the traditional economic model of the market cannot be used in its present form to understand what is happening in the field of medical services, a presentation will be made of the factors affecting the behavior of physicians as purveyors of services, thus showing the importance of analyzing the influence of economic incentives on physician behavior. The analysis consists of measuring the change in the practice profiles of physicians from 1971 to 1973, and evaluating the influence of the fee schedule on this change. This research allows us to show that the personal characterictics of physicians, the characteristics associated with the organization of their practice and the area in which they practise are only very slightly related to the changes in the mix of the medical services produced by physicians; that the change in the profile of practice cannot be associated with changes in the populations' needs, and that the financial incentives incorporated in the fee schedule have been found to be mainly responsible for the shifts observed in the profiles of practice. We conclude by showing how these results are compatible with the hypothesis that physicians can influence demand for medical services.
The increase of public expenses in the hospital sector has become an issue of great concern in Canada today. This study1 focuses on future requirements for hospital care for the period ranging from 1976 to 2031. It takes into consideration the changing composition of the population as well as the different consuming profiles of various age groups and sex. It further provides alternatives to hospitalisation and illustrates the savings that could be incurred in the process. Finally it does warn against some of the potential dangers of implementing certain alternatives to meet the future increase in demand for hospital services.
• Demand by the elderly for hospital services will likely more than triple within the next half century.
• If the projected need is met by providing new hospital space, annual operating spending on hospitals could more than double to $11 billion.
• By 2031, patient-days for the Canadian population as a whole are expected almost to double, from the present 43 million to 84 million. But in the same period, those for persons of 65 or over will multiply by over three times, from 16 million (38% of the current total) to 55 million (65%) of the projected 2031 total).
• Greater use of present hospital capacity and the substitution of lower-care facilities like nursing homes or non-institutional care could delay the provision of hospital beds until the mid 1990s.
• Establishing more lower-care facilities implies a potential saving on hospital operating costs of $27 billion over the next 50 years.
1. "A Prognosis for Hospitals: The effects of population change on the demand for hospital space, 1967 to 2031", by L.A. Lefebvre, Z. Zsigmond and M.S. Devereaux. Statistique Canada, catalogue 83-520E, 1979.
The review of the budgetary bases of hospitals in Quebec is conducted in three stages: (1) classifying hospitals; (2) evaluating the performance of human and material resources used in each hospital as well as comparing this performance with the average performance of the peer-groups; (3) using the results to establish a correcting mechanism for an adequation redistribution of a portion of the total budget among individual hospitals. The realism of this process of budgetary review lies in the possibility of appropriately classifying the hospitals according to their output. In this paper, along with a short presentation, at the end, of the two last steps of the review process, we focus on the classification itself. We define firstly what constitutes the hospital's output, which is a mix of inpatient services (main variable), outpatient services, research and teaching, as well as environmental variables influencing the output. Then we describe the classification technique, which uses two different similarity indices, one for the distribution of patient-days by category of diagnosis (ICDA, 8th revision), and the other for all other variables; these indices are incorporated in a hierarchical sorting strategy based on the optimization of an objective function. This method is subsequently applied to the acute short-term hospitals of Quebec, using 1976-77 data, and the different resulting eight groups of hospitals are broadly described. In the conclusion, are indicated some suggestions for improving the classification and the budget reviewing mechanism itself.