Health Care Privatization: Women Are Paying the Price

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During the 1990s, Canada’s health care system underwent a massive transformation, in a declared effort by all provinces and the federal government, to cut costs and make the health care system "more effective". Recent research conducted by the Centres of Excellence for Women’s Health National Coordinating Group on Health Care Reform and Women demonstrates that privatization is a primary cost-cutting strategy in current health care reform and that privatization is moving swiftly, quietly and devastatingly into the health care system in Canada in multiple ways. Health care is rapidly being defined as a private responsibility or even a market commodity, the role of the public sector is being limited, and private schemes, whether through methods of payment or provision of services, are gradually taking its place. Because it is happening in different and gradual ways, and under such different names, privatization has confounded clear evaluation, confused public debate and crept into the health care landscape without significant notice or comment.

The Coordinating Group’s research identifies five primary ways that Canada’s health care system is being privatized: by shifting payment to individuals; by expanding opportunities for private, for-profit companies in the health "business"; by shifting care from public institutions to community-based institutions; by shifting work from full-time professional health care staff to unpaid family members or casual, lowpaid home workers; and by adopting management strategies of private businesses, treating health as a market commodity. And the Coordinating Group shows that the effects of these changes are most severely felt by women, as primary providers and recipients of health care.

You would think, given the high level of political, public and media concern about health care, that information on the extent and impact of this trend would be readily available. You would be wrong. While all provinces have adopted most of these strategies, the process, types, depth and influence varies considerably across the country. And the changes have happened so quickly and so massively, and with so little public information, that no one seems to have a clear idea what has happened where, and why, and what the real impact has been.

But analysis yields dozens of province-by-province indicators of the variety and effect of privatization. In several provinces, overall private sector sources of spending on health care now more than a quarter of total health care expenditures. In 2000, a Canadian Institute of Health Information report on health care expenditures spelled out private spending on health care as a proportion of all health care expenditures: Ontario’s was the highest in Canada at 34%, followed by Alberta, P.E.I. and New Brunswick at 31%. Between 1990 and 1996, private expenditures for health care increased 43% in Saskatchewan, and 33% in Manitoba. In Quebec, private health care spending as a proportion of total health care spending increased from 25% in 1989 to 30.9% in 1998. The majority of private funding—55%—comes from direct outlays by individuals and 35% from private insurance. Private health care insurance is doing quite well too, as people scramble to get coverage for health care no longer publicly funded. Health insurance premiums as a proportion of all insurance premiums collected by Sun Life in Quebec rose 45.6% between 1987 and 1996. Alberta had a sudden upward jump of 11% in private health insurance coverage in 1997, more than double the national average.

Privatization has included everything from de-listing or cutting back on professional services such as vision care and physiotherapy; to contracting out essential aspects of hospital services (now referred to as "hotel" services) such as dietary, laundry, housekeeping, waste management and even health information systems; to moving people out of hospitals quicker, so that drugs, medical devices, supplies and personal assistance, once covered in hospitals, are now paid by the individual at home; to, in Ontario, putting all home care services up for tender in a competitive bidding process, with the requirement that contracts be awarded to a "mix" of non-profit and for profit contractors. In Newfoundland, the health information system is being contracted out to a private corporation known as SmartHealth, a joint venture between the Royal Bank and EDS Canada Inc. In Ontario, an estimated 90% of nursing homes are operated by for-profit firms, often organized into national or international chains. In B.C., the use of private physiotherapy clinics increased 23% between 1994 and 1998. These are only a few examples of the numerous and varied incursions of private enterprise into the health care field.

Does the shift to privatized health care save money? Not according to studies so far. Manitoba tried transferring three components of the health care system to private corporations—a food services corporation to supply all Winnipeg hospitals, a privately run health and drug electronic information network, and a large contract to a private U.S.-based home care provider. All three contracts were terminated after the corporations were unable to meet the cost or performance goals. A Quebec study showed that the cost of a meal served by a privatized food service was 10.5% higher than the same meal served by a government-run service. And Robert Evans in Going for Gold: The Redistributive Agenda Behind Market-Based Health Care Reform concludes, "International experience over the last forty years has demonstrated that greater reliance on the market is associated with inferior system performance —inequality, inefficiency, high cost and public dissatisfaction".

Worse, there is little information about how this massive move to privatization will transform into practice under current and future international trade agreements, and whether Canada could ever retrieve its public health care system from the increasing grasp of international corporations, without having to repay hugely for these firms’ loss of potential profits.

Gender analysis suggests women are bearing the brunt of health care reform privatizations. Women provide more than 80% of paid and unpaid health care in this country and are the most frequent users of the health care system —as patients themselves, or taking children and relatives, especially seniors, to care. The women who comprise 80% of the paid health care work force— nurses, aides, dietary and housekeeping staff—faced staggering job loss under massive hospital closures and restructurings of the ’90s, losing many of the economic advances gradually accrued over past decades.

Additionally, health care reforms such as community-based care and shorter hospital stays were based on the assumption that families would pick up the slack in looking after their relative at home. Once health care moves outside hospital walls, it is no longer an insured service, and services available from provincially funded home care fall far short of demand. For example, in Ontario and Quebec, publicly funded programs pay for about 2 hours of care at home per day, leaving the individual or the family to provide or pay for the rest.

In short, privatization in all its forms characterizes much of health care reform and women are making up for the “savings” to the public system. There need to be real choices, based on real investigations into current and long-term impact, on such a fundamental transformation of the nation’s health care system. So far, from the perspective of Canadian women, who have had little opportunity for input into these sweeping changes, privatization has reduced their incomes and job security, left them with more support to provide at home, and reduced their choices and access to quality care. Health care reform, as currently being implemented, is a problem, not a solution for women.

This article is summarized from the book Exposing Privatization: Women and Health Care Reform in Canada by Pat Armstrong, et al., published Nov. 2001 by Garamond Press, $24.95. To order: Garamond Press, 63 Mahogany Court, Aurora, Ontario L4G 6M8. Tel.: ( 905) 841-1460, Fax: (905) 841-3031, E-mail:, Website:

A plain language booklet, Women and Health Care Reform, is available in English or French, free of charge, from your closest Centre of Excellence for Women’s Health or from the CWHN. Bulk orders accepted. Download from This booklet also contains a full list of regional research reports from the Centres.