FEDERALISM AND HEALTH POLICY Social Citizenship and Health Planning in Federal States

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FEDERALISM AND HEALTH POLICYSocial Citizenship
and Health Planning in Federal States

• Keith G. Banting
• AIES 25-27 September 2002

KGB-056
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Federalism and Health Policy

• Common Policy Agenda
• Common policy challenges
• Common political pressures
• Institutional Structures and Policy Outcomes
• Comparative study of five federations
• The Canadian case
• Two Central Issues
• Social citizenship and access
• Planning and health expenditures

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Social Citizenship

• Social citizenship and health care
• Social citizenship and community
• class/ territorial integration
• Social citizenship and federalism
• inevitable tension?

KGB-028
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Policy Instruments I

• Central Policy Framework
• Policy framework versus fiscal federalism
• Variations in specificity of central frameworks
  in five countries
• Decentralizing pressures but little
  decentralization in these five federations

KGB-036
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Policy Instruments II

• Inter-regional Transfers
• Explicit and implicit inter-regional transfers
• Variations in levels of tolerance of
  inter-regional inequality
• Growing controversy over inter-regional
  transfers in several countries

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Social Citizenship and Federalism
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Planning and Expenditures

• Traditional interpretation
• Federalism as a constraint on social spending
• The pattern in health care
• Federations as high spending systems
• Federations weak in containing cost pressures

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Total Health Expenditures as Percent of GDP,
Federal and Non-Federal States. 1960-1998
Notes Belgium is treated as federal throughout
the period. Germany data in 1990s include East
Germany. Source OECD Health Data 2000
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Public Expenditure as Percent of GDP, Federal and
Non-Federal States. 1960-1998
Notes Belgium is treated as federal throughout
the period. Germany data in 1990s include East
Germany. Source OECD Health Data 2000
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Public Expenditure as Percent of Total Health
Expenditures, Federal and Non-Federal States.
1960-1998
Notes Belgium is treated as federal throughout
the period. Germany data in 1990s include East
Germany. Source OECD Health Data 2000
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Capacity for Cost Containment

• Cost containment versus cost shifting
• Vulnerability of fragmented systems to cost
  shifting
• Vulnerability of federations to two cost shifts
• Cost containment in two federations
• Canada
• United States

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Some tentative conclusions

• The paradox of federalism and health care
• Effective inter-regional redistribution
• Weak cost containment
• Federalism ? health policy

KGB-067
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The Canadian case

• The Canadian model
• Lean central framework Canada Health Act
• Medium inter-regional transfers
• Comparable coverage of core services
• Consolidated expenditure control

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Provincial Government Expenditures,per capita,
2001
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Public Health Expenditure as Percent of GDP
Canada, Federal and Non-Federal States, 1960-1998
Source Calculated using transfer data from the
Department of Finance and expenditure data from
the Canadian Institute for Health Information
(CIHI).
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Challenges IThe Narrowing of Social Citizenship

• Expansion outside of the Canada Health Act
• Pharmaceutical drugs
• Homecare
• Narrowing of the social citizenship model
• Public/private mix
• Regional variations

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Drug Care of population with public or private
coverage
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Challenges II Erosion of federal support

• Block funding a delayed poison pill
• Cuts in the federal contribution
• Intergovernmental disequilibrium
• Conflict over the real federal contribution
• Contradiction between policy and fiscal roles
• Intense intergovernmental conflict

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Federal Transfers for Health Care as a Proportion
of Provincial Health Expenditures
Source Calculated using transfer data from the
Department of Finance and expenditure data from
the Canadian Institute for Health Information
(CIHI).
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Challenges IIIMechanisms of Conflict Management

• Formal Intergovernmental Bodies
• joint decision-making
• Political Processes
• integrated political parties
• Canadian model
• lack of formal intergovernmental bodies
• lack of integrated party system
• intergovernmental political conflict

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More Tentative conclusions

• A comparative perspective
• the paradox of federalism and health care
• federalism ? health policy
• A Canadian perspective
• funding functions versus instruments
• shared understanding of fiscal shares
• formula based on health expenditures
• joint decision-making and dispute resolution