Not utilizing activity-based funding, where hospitals are paid an amount of money for each patient cared for, is leading to worse outcomes in our health-care system, Nadeem Esmail contends in this Fraser Institute study.
It also makes Canada an outlier amongst most of its peer nations — nearly all of the world’s developed nations with universally accessible health-care systems have at least partially implemented models where money follows patients for hospital care and is based on their particular condition and unique needs. Doing so creates powerful incentives to deliver a greater volume and quality of services, with the potential to reduce wait times.
Of the 28 countries that provide universally accessible health care, only five (Canada, Ireland, Luxembourg, and New Zealand) still utilize the global-budget approach to funding that is in effect here. Under this system, the lump sum payments given to hospitals are not contingent on how many patients they treat.
“Policymakers across Canada should learn from our counterparts in other countries that have embraced per patient funding of hospitals as part of universal health care,” writes Esmail. “The way we primarily pay for hospital care in Canada runs counter to the international norm, and serves neither the interests of patients nor taxpayers who fund their care.”
