Why Single-Payer Won't Necessarily Satisfy Your Medical Needs

Canada is a tad short of physicians. Eight years ago, the Canadian Medical Association warned that there weren't enough doctors to go around, six years ago, the Fraser Institute said (PDF) "there are too few physician services being delivered in Canada to meet the demand for services," and since then, Macleans has cautioned that waiting lists are likely to get longer since new doctors coming into the sytem are working fewer hours than their predecessors. But, while demand usually drives prices up, which draws new supply as current providers work harder and new providers flock to satisfy customers, a column in Saturday's Globe and Mail tells us why that's unlikely under Canada's single-payer medical regime.

In an overall depressing piece about the poor prospects for people choosing professional educations in the current lousy economy, Margaret Wente writes of what the future holds for those going into medicine:

The trouble is that doctors have just one big client – government – whose ability and willingness to pay is shrinking fast. The booming consumer demand for medicine doesn't necessarily translate into jobs. Even though hospitals need extra surgeons, they aren't hiring them because they can't afford to expand operating-room time. Of all the general surgeons who finished medical school at the University of Toronto in the past two years, only 15 per cent have found work. The rest are pursuing further training, in hopes that something will eventually open up.

Yet in spite of all this higher training, doctors' incomes, too, are heading down. Ontario has just announced a freeze on total funding for doctors, which means that new doctors will have to share the pot with existing ones. The Ontario Medical Association figures that over the next four years, the freeze will mean a total pay cut of 16 per cent.

Under Canada's socialized health care system, unsatisfied demand doesn't result in economic incentives that would spur increased supply. There's little reason to work harder, or to go into the medical field at all, if your compensation is disconnected from the need for your services — especially if it's actually declining.

And so the gap between demand for physicians and the supply is likely to grow.