DA turns rural hospitals impact, rural hospitals will be severely underfunded and understaffed

Due to the demographic and socioeconomic composition of their patient populations as well as low patient volumes, small rural hospitals are inevitably more expensive and less efficient than other types of hospitals. Under a single-payer model in which the government has embraced the principle of universal access—as codified in the accessibility principle of the Canada Health Act, for instance—there is greater tolerance for the operational inefficiency of rural hospitals than is found in a largely market-driven system like that of the U.S. In an interview with the author (March 4, 2020), director of the Health Sector Models Branch of OMHLTC, Sherif Kaldas, confirmed the prioritization of access in the rural context: “We decided from a policy perspective . . . efficiency means little in this setting. It’s access. Are [rural residents] getting equitable access to [the level of hospital care that one associates with] large, urban centers?”

In 2012, Ontario introduced its Health System Funding Reform, a plan to transition hospital funding from simple global budgets to a Health Based Allocation Model based on patient populations and organizational performance. In doing so, however, the Ministry of Health recognized that small rural hospitals could not sustain the financial instability likely to result, and excluded such hospitals from the reform (Palmer et al. 2018). It must be emphasized that this kind of attention to and accommodation of the special needs of rural hospitals is not an inherent element of single-payer systems. Rather, it represents a hallmark of how single-payer health care originated and evolved in the Canadian context specifically.

While their financial condition may be stabilized to some extent, rural hospitals in Canada remain vulnerable. Because tax dollars pay for health care services, minimizing the per-capita cost of care is an important political objective of Canadian health policy. One interviewee referred to this dynamic as the “efficiency agenda.” Rural hospitals in recent years have been largely protected from major restructuring, but the aforementioned cases of Saskatchewan and Ontario in the 1990s demonstrate the very real possibility of facility closures in remote areas under the banner of efficiency.

Health workforce shortages also pose serious problems for rural hospitals, many of which struggle to attract and retain an adequate supply of health professionals. These shortages persist in spite of the considerable political attention paid to them by provincial governments (evident in the array of incentive programs available to rural health workers) and in spite of Canada’s single-payer model. Based on the author’s interviews with rural health stakeholders, there is no indication that a single-payer model naturally produces a more equitably distributed health workforce. This must be accomplished instead through the adoption and expansion of separate workforce-specific policies.