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State is stifling innovation at hospitals: health-care executive

May 8, 2012

National Post

Tom Blackwell

The head of a controversial “executive” health clinic made a spirited call Tuesday for more entrepreneurship in Canadian health care, charging that central government planning has undercut a storied surgical hospital and saddled Ontario with an inferior telephone health-advice service.

Restrictions imposed on Toronto’s for-profit Shouldice Hospital — once an international model of medical business — have prevented the clinic from offering the most advanced form of hernia operation and eroded its market share, charged Shaun Francis, CEO of Medcan.

“Isn’t it sad how the system has effectively forced a jewel to languish,” the CEO commented to an Economic Club of Canada luncheon crowd. “What killed the Shouldice? The government killed the Shouldice…. Time and again, the government has shown the central planning approach is futile.”

A spokesman for the hospital, however, voiced surprise at Mr. Francis’s comments, saying that Shouldice is seeing as many patients as ever — about 7,500 a year with 1,000 on the current wait list — and has even talked to potential partners about expanding to China and India.

In Ontario, the province pays for patients to undergo treatment at the private hospital.

The Medcan CEO “should have gotten his facts straight first,” said Daryl Urquhart, a Shouldice spokesman.

“The hospital is certainly not falling on hard times,” he said. “It is as much in demand as it’s ever been.”

Mr. Francis’s company, founded by his physician-father, was one of the first in Canada to offer enhanced primary-care services — such as longer doctor appointments and more preventive tests — for a fee.

In his speech, he said Shouldice earned an international reputation by performing one procedure — hernia repair — more efficiently and safely than it was done in general hospitals.

Then in the 1990s, a California surgeon came up with a more advanced repair technique that allowed patients to go home the same day. Because the Ontario government allowed Shouldice to make a profit only from patients’ overnight stays, it was unable to adopt the out-patient technique, Mr. Francis said.

Not so, said Mr. Urquhart. In fact, Shouldice’s reputation is founded on the care it provides patients — away from the infectious disease and other risks of a large hospital — not a particular technique, he said. Still, the province does bar it from building new facilities, he said, the current Liberal government being generally opposed to for-profit clinics.

As more evidence of what he called the negative effects of government management, Mr. Francis said Ontario also rejected a telephone medical-advice service — whose computer software he was marketing — that would have actually helped keep people away from emergency departments. The province opted instead for a cheaper program, now called Telehealth Ontario, that offered callers information but no advice on where they should seek care, Mr. Francis said.

Short-term savings have been more than offset by the additional thousands of patients who needlessly end up in emergency, he claimed.

A prominent defender of public health care dismissed, however, the notion that government has excessive control over the system. Most physicians in Canada are private operators, and face much less interference than their counterparts in the U.S. do from both private insurers and government, said Dr. Danielle Martin, a spokeswoman for the group Canadian Doctors for Medicare.

The success of clinics such as Shouldice, and non-profit cataract-surgery centres in Toronto and Winnipeg, comes not from the commercial motive, but from offering one procedure with factory-like efficiency, in a relatively risk-free environment, said the Toronto family physician.

As for Medcan and other executive clinics , Dr. Martin said they were “horribly inefficient” themselves, offering long appointments for minor complaints, and conducting unnecessary and pricey tests. She said some of her own patients have memberships in the private clinics as a company perk and show up with reams of printouts from questionable screening, such as heart stress tests done on healthy 40 year olds.

The private clinics then expect her to deal with the results.

“To characterize that kind of health care as efficient is absurd,” said Dr. Martin.

National Post
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