The Swedish Model – Healthcare

Media Appearances, Healthcare & Welfare, Frontier Centre

Nurses want more money. In British Columbia, they rejected the provincial government’s offer of a 22% wage increase over two years and have refused to work overtime. More than 5,000 operations have been cancelled since April. In Nova Scotia, Premier John Hamm is contending with a similar problem. His nurses rejected a 10.5% increase over three years and are promising to “escalate the chaos” in response to legislation that will take away their right to strike. Such confrontations are symptomatic of a health care system that is economically unsustainable in its current form because of an ageing population and the advent of expensive new medical technologies. If Canadian governments and unions continue to oppose privatizing health care services, nurses’ picket lines will become a regular sight all over Canada.

If more government money for nurses is not a viable long-term solution, what is? The National Post has argued consistently since its launch that what is needed is private sector health care provision. Interestingly, the Royal Commission on health care, headed by Roy Romanow, the former NDP premier of Saskatchewan, is about to hear the same message from another source, for it has begun recently to take an interest in Sweden. Should Mr. Romanow look closely at that country’s experience, this is what he will find:

Decades ago, the Swedish government made a conscious decision to begin micromanaging the country’s health care industry. Public physicians were salaried and pharmacies were nationalized. Thanks to these moves, and the attendant bloating of the nation’s health care bureaucracy, the system became economically unsustainable. In the late ’70s and ’80s, the country’s economy stagnated, yet the number of nursing support workers increased by 600%, the number of doctors and nurses by 200% and the number of administrative staff by 300%. In the early 1990s, Sweden’s economy contracted, and politicians realized their health care system was a big part of a massive problem and had to be overhauled. According to Johan Hjertqvist, a health reform advisor to Stockholm who was interviewed by Manitoba’s Frontier Centre for Public Policy, the Swedish government continues to pay for most health care but it is now buying “services from competing suppliers who are finding ways to focus on customer service and increase productivity.”

Sweden’s largest nurses’ union enthusiastically supports the reforms because it is easier to negotiate higher wages with private sector heath care providers than with the government, which blocked efforts to raise salaries for decades. In Stockholm, 80% of medical services are supplied by private companies selling health care services. New private hospitals put pressure on public hospitals to improve their level of care and efficiency. As a result, the publicly funded health care system thrives while purely private health care accounts for less than 1% of the market. The public system has been preserved, access maintained, savings realized, and nurses unions have been able to win better wage increases for their members.

This is what Mr. Romanow will discover in Sweden, and it should feature in the Royal Commission’s final report. Yet the Swedish solution is exactly the sort of health care innovation that Canadian nurses’ unions oppose. What they endorse is a continuation of the status quo, but with more money for them. They fail to see that the status quo will soon be unaffordable. Our governments had better get this message soon. Until Canada introduces competition into health care services, we will continue to see angry nurses badgering politicians, hospital beds closed and surgeries cancelled.