Private insurance, public insurance, or a combination of public and private to fund elder care, the issue will not go away, nor will it diminish in magnitude or importance over the next several decades. Boomers are a large demographic bubble, and they are going to retire at a rate for which Canada as a nation, and each province individually, is unprepared.
As Ms Goar intimates, people passed by on the street while the speakers delivered their respective arguments, blithely and blindly expecting elder care to be there for them when they need it.
There is no such guarantee.
And while it is easy to predict how national political parties will see the three proposals, private, public, or some combination...(Conservatives for private, NDP for public and Liberal for a combined public-private funding proposal) it is not easy to predict which of the three political parties is prepared to enter the fray on behalf of seniors, who could comprise one of, if not the biggest voter blocs in the next several federal elections.
This space begins the discussion asking readers to seriously contemplate a fully publicly funded elder care program, using a value-added tax to fund it. There are so many advantages to that approach.
First, it would level the playing field for all Canadians, regardless of name, income, political and social status, education or sickness of the applicant. We have already seen that medical doctors, when faced with a choice between welfare recipients and bankers, for their new patients, opt for the latter over the former. The extra costs of not implementing a publicly funded program would necessarily be borne by other social agencies already strapped for cash for the programs they are attempting to provide. The national health care program is based on equal quality and equal access of affordable health care for all. And while there are obvious, sometimes glaring gaps in service accessibility and quality, as well as affordability, there are at least agents dedicated to monitoring such gaps and exposing them for political embarrassment and potential amendment. Wait times for surgeries is one example demonstrating that when provincial governments address such issues, they can and do make considerable progress in remediating those inadequacies.
If we opt for an exclusively privately funded elder care program, there will inevitably be many who either cannot or will not be able to afford its purchase, leaving them subject to whatever public programs, or indigent programs from places like churches and social activist groups, where neither standards nor accessibility will be assured. There will inevitably be more wealthy seniors who can afford to spend their last years in some sunny clime, probably in privately funded programs, in such places as Arizona or Florida. Few of those candidates would opt for a privately funded program in Yellowknife, for example. Also, under a privately funded elder care program, the insurance companies would have excessive control, no matter what public monitors and investigators are added for oversight. In short, the old adage, that where the private sector controls social programs, only the wealthy have adequate care, for the largest number of clients. They have more choices, so the providers know that failure to provide to the standards they are willing to pay for will result in lost revenue as those clients seek other accommodation.
As a second-best option, typically Canadian, and typically more likely and more readily achievable in the current political climate, is the combined public-private option. Individuals would contribute, as we do now to Canada Pension, as would employers and the national government, generating a program of care that, while much more complex, nevertheless, has some of the benefits of the public proposal, and fewer of the defects of the privately funded proposal. There would be more enforceable standards, using the leverage of public oversight and there would be fewer cases of extreme poverty and inaccessibility, given a universal contribution to underwrite the program, for all to access.
We strongly endorse the fully funded public proposal as the first place to begin negotiations, thereby establishing some of the main principles to be included in whatever program results from the federal-provincial negotiations that would be required. And we strongly urge both the Prime Minister and the several Premiers to begin formal negotiations on a national care for the elderly program that would accommodate the bubble of boomers still working and still able to contribute, and that window of opportunity is closing rapidly, if it has not already closed.
Canadians close their eyes to the staggering cost of elder care: Goar
No one has to clue how to pay for elder care as the population ages and families stagger under the load.
By Carol Goar, Toronto Star, February 27, 2013
Every table was packed. Graham Fox, president of the Institute for Research on Public Policy, knew the luncheon panel would be a sellout.
He introduced the topic — Paying for Elder Care — and invited the three speakers directly to the podium.
The first was David Baker, assistant vice-president of Sun Life Financial. He made the case for private long-term care insurance.
The gist of his speech was a wake-up call to baby boomers. Too few recognize they are on “declining trajectory” he said. “People need a more realistic expectation of what retirement might look like — it’s not all cruise ships and golf courses.”
When consumers stop deceiving themselves, the market for long-term care insurance will improve, Baker said.
For a knowledgeable audience, his presentation offered little insight.
The second panellist was Michel Grignon, director of the Centre for Health Economics and Policy at McMaster University. He made the case for a universal public insurance plan to cover long-term care.
His address, backed up by a 27-page study, was meticulously researched. He examined all of the options — private, public, a mixture of both — and concluded a new taxpayer-funded plan would be fairest and most efficient way of providing elder care.
The problem with Grignon’s argument was his blithe assumption that Canadians would willingly pay for the program. “You can use sales taxes or value-added taxes, not just income taxes,” he said, as if that somehow made the price tag — an estimated $1.2 trillion over the next 35 years — more palatable.
For those working in the field, a grand scheme without a credible funding mechanism amounts to a pipe dream.
The final speaker was Michael Decter, a Harvard-trained economist who spent half of his career in the public sector, serving as Ontario’s deputy minister of health, chair of the Canadian Institute for Health Information and chair of the Health Council of Canada; and the other half as chief executive officer of an investment management firm.
Sensing the mood in the room, he pulled no punches. “It’s a terrible time to talk about big new spending plans,” he acknowledged. “But we have to retool the programs we’ve put in place. We’re living longer, but we haven’t adjusted our hospital insurance or pension plans.”
The challenge is not insurmountable, he assured the audience. Germany has done it. Several other nations — Japan, Korea, the Netherlands and Luxembourg — are following the same path. But it will require a mix of public and private funding.
He envisages a framework like the Canada Pension Plan into which workers and employers would contribute. Ottawa would administer it and the provinces would ensure that home care and long-term care were there for Canadians as they aged.
He also believes unpaid caregivers should be eligible for cash benefits. “Within family structures, there’s often someone who is dragged into providing care at no cost.”
Not only would this be more equitable than a plan covering only institutionalized care (which 80 per cent of Canadians will never need); it would give contributors a reasonable expectation of getting something back for their money.
The leadership, Decter suggested, would probably have to come from one of the provinces. “Quebec usually plays that role, but it’s financially strapped right now.”
What all three speakers agreed on was that it is critical to get Canadians thinking and talking about this issue. The existing elder care system is breaking under the strain — the waiting list for a spot in a nursing home is approximately 20,000 in Ontario alone — and the baby boom hasn’t even hit its heavy-need years. Home care is severely underfunded. And hospitals, the most expensive option, can’t accommodate an influx of frail, elderly patients.
The red flags were obvious to everyone in the room. Outside, people went about their business, assuming the elder care system would be there when they needed it.