Health-care spending scare tactics unfair to public
Alaska Highway News, September 27, 2006
by Paul Willcocks

Carole Taylor created a pretty big splash with a single PowerPoint slide suggesting that within 11 years health and education could take every penny of government spending.

Too bad it was such a bogus claim. Worse that so many people bought it.

Taylor, the finance minister, tucked the slide into her first quarter financial update this month.

Do you realize, she asked as the slide popped up in the Press Theatre, that by 2017 health care could consume 71 per cent of all government spending?

Education would take the rest and everything else would just vanish. It was a pretty dramatic scene setter for the "conversation" on health care that's to kick off this week.

Except it was a fraud. By 2017 my dog Jack could learn to talk. But it's not likely, based on everything I've seen from him so far.

And neither is the health crisis projected by Taylor.

Here's what the finance ministry assumed to reach her worrisome projection. Health ministry costs would increase by eight per cent year after year.

Government revenues by three per cent. Education spending by three per cent.

Here's reality. From 1995 to 2005 health ministry spending increased an average 5.5 per cent, not eight per cent.

Education spending over the last five years has increased at 1.3 per cent a year, less than half the rate Taylor projects.

And between 1995 and 2005 government revenues increased by about six per cent a year, not the three per cent the finance minister assumes.

So. Taylor's forecast assumed a 50-per-cent reduction in the growth of government revenue. (That assumes big tax cuts, or a weakening economy.)

Education funding would suddenly grow more than twice as fast it has in recent years. And health spending would reach new heights. Plug in numbers based on reality - the real record from the last decade - and everything changes. The health ministry would then count for about 40 per cent of the total budget by 2017. Just as it does now. The slide looks dramatic; the reality not so much.

The finance ministry now says the graphs were just something worked up in 2004, interesting but not a real projection, they say.

But there were fewer than 20 slides in Taylor's presentation. If one of them shows a crisis barely a decade away, people will pay attention.

Especially as Premier Gordon Campbell kicks off his conversation on health care with British Columbians.

The conversation is a good idea, if done properly. Almost every interest in the health-care world has an advocate - unions, the BC Medical Association, the pharmaceutical companies, the government.

But not the patients or customers or whatever you want to call us.

Taylor's slide - if people took it seriously - would shut down any real conversation. Too many options are eliminated if you think disaster is looming.

It's not. Back in 1985, about one in every three dollars the government took in went to pay for health care. In 1995, the same. And this year, based on the latest financial reports, health will consume less than one-third of provincial revenues.

Look at it another way. In 1985, health spending was about five percent of GDP. By 1995, it was 6.6 per cent. This year it will be about 7.3 per cent.

The increase is an issue, but the notion that we can't afford health care - that it's not sustainable - is simply not supported by the facts.

And while we fret about $12 billion in health care costs, we pump $7 billion into slot machines, lotteries and other legalized gambling without any significant public concern.

There are good reasons to manage health-care costs. It's government's biggest budget item and the cost pressures are significant. New technology and drugs are increasingly expensive and as out average age rises we place more demands on the system.

But there's no reason to panic. And a real health conversation should start with facts, not phony fear-mongering.

Footnote: Taylor also cited warnings from the health authorities that the budget left them without enough money for the coming two years as a sign of pressures in the system In fact, it's a sign of unrealistic budgeting by the province. The current fiscal plan actually calls for a small cut in real per-capita health ministry spending in 2007/8.