Proceedings of the Standing Senate Committee on
Social Affairs, Science and Technology

Issue 5 - Evidence

The Standing Senate Committee on Social Affairs, Science and Technology met this day at 11:05 a.m. to examine the state of the health care system in Canada.

Senator Michael Kirby (Chair) in the Chair.

[English]

The Chairman: Senators, we are here to continue our examination of the health care system in Canada. This morning, several witnesses will deal with the issue of technology, that is, the state of current technology in Canada, how we evaluate new technology and the cost, ultimately, on the health care system.

We must adjourn for the sitting of the Senate at 1:30 p.m. today. We will adjourn the open session at 1 o'clock, and then hold a short in camera session.

Our first witness today is from the Canadian Association of Radiologists, Dr. John Radomsky. I will ask the four presenters to do make presentations, and then we will open the floor to questions of the whole group as a panel.

Dr. John Radomsky, President, Canadian Association of Radiologists: We have prepared the document in front of you, which is the basis of the discussion. It contains the detail that I cannot get into in my address. Detailed recommendations and many issues are dealt with in the report, matters that I would not have time to raise.

It is hereby declared that the primary objective of the Canadian health care policy is to protect, promote and restore the physical and mental well-being of residents of Canada and to facilitate reasonable access to health care without financial or other barriers. The Canada Health Act, 1984 contains the confines within which we provide our service to the Canadian people.

I am a general radiologist, not an academic. I come to you with a background of 24 years of hands-on experience in radiology in central Alberta, covering a territory of 10,000 square miles with a large regional referral centre, 10 to 15 small hospitals and clinics scattered throughout that territory, and a modestly large independent health care facility funded through the medicare system.

My background is that of hands-on, everyday problems with everyday Canadians, in the situation that we find ourselves today.

What is it that I do? What is radiology? What are we talking about?

Roentgen discovered x-rays 105 years ago. He used the process to image his wife's hand. It provided a rather crude but reasonably detailed picture of the anatomy of the bones. For most of the last century, that is as far as radiology progressed. We looked at gross anatomy and some function and structure within the body, but we did not get much farther until the last two or three decades when the computer revolution, information technology, and all the new high powered technologies allowed us to develop our profession into a multi-modality, multi-speciality service that is best described as medical imaging, not just radiology. We use gamma rays, x-rays, ultrasound, magnetic fields and radio frequency to provide highly detailed sectional images of the body.

We are now at the point with the service that we cannot only screen for disease, we can diagnose disease. We can describe the extent and the spread of disease. In many instances, we are crossing the boundaries into therapy where we can use image-guided procedures to do biopsies and other therapeutic procedures that replace, significantly, more expensive, more time-consuming and, for the patient, much more painful procedures.

Clearly, then, medical imaging is strategically placed to be central -- crossing many boundaries, many specialities, in the medical system.

We are not just taking x-rays. We have gone to the point now where we can look at the molecular level. The issues we face as radiologists are not simply radiology issues. They are issues that must be addressed by virtually the entire medical community. We are multi-modality and multi-specialty at this point.

Where does this take us in the future? Very briefly, we can only see a significant increase in demand for medical imaging services. There are minimally invasive, cost-effective, and very minimally traumatic to patients.

We have a cohort of approximately 10 million baby boomers in Canada who very soon will reach that age, the last 20 per cent of their life span, where they will require the greatest part, approximately 80 per cent, of their medical care. We may not be prepared within the confines of the current system to provide that care for those patients and to provide the consultations with our other colleagues in other fields. In 20 to 30 years, our population over 60 is expected to increase from approximately 10 to 15 per cent to over 30 per cent of the total population. That is why we are concerned and why we are here today.

Finally, in the future, to be very brief, we are in the age of information technology -- the age of computers. We are now able to rapidly acquire cross-sectional and other images digitally and almost instantaneously transfer those images within our institutions to other institutions and even across international boundaries. Yet, our industry, the medical industry, is the only industry in Canada that has not seized on this strategic advantage and developed the infrastructure to use information technology which in every other industry has been proven to be incredibly cost-effective and saved money. We want to achieve eventually first-test, best-test, only-test as a diagnostic ideal. We cannot do this if we do not know what the patient has had done in another centre and are unable to call up the images for comparison. We simply do not have the infrastructure.

We have a major problem in our profession specifically in medical imaging. We have a major lack of equipment in the high-tech end, we have a major deficit in the standard equipment that does the ordinary, everyday basic ultrasound and x-ray and medicine procedures, and we have an accompanying manpower deficit, all stemming from the fact that approximately eight or ten years ago funding was cut to the training programs and to the acquisition programs. We are no longer in a position where we can routinely replace aging equipment. Aging equipment is only replaced now in most centres on an ad hoc basis when it is no longer functional. Indeed, our association has done a considerable amount of research on this, and up to 60 per cent of the equipment in many areas is technically outdated.

More specifically, we are at the bottom third of the Organization for Economic Cooperation and Development when it comes to numbers of high-tech equipment, but we are in the top five when it comes to health care spending as a percentage of GDP. Many of our standard x-ray machines and other machines in the hospitals are functionally inadequate at this point because they are simply too old to do the job for which they were designed. It has become quite common to see duct tape holding our equipment together. It has become a joke amongst us. You see this in the press, but it is true. I have seen it in my own hospitals and my own area of work. We are using a Band-Aid approach to fix a major problem when we need to address the structural deficiencies in the system.

With respect to manpower, currently, out of a population of approximately 1,800 to 1,900 radiologists in Canada, we are 200 radiologists short. In this province alone, in the last few weeks, the Ontario Association of Radiologists published in their newsletter job openings for at least 45 radiologists. Take this across the country and you will come up with a significant deficit. We simply do not have the manpower to provide the service. In my own practice, we have had to curtail service, and notice was given three months ago, not just today, for the benefit of the press. We have had to curtail service to two small institutions because we do not have the manpower to provide them the service on-site. Patients have to travel. They are inconvenienced. In many cases they just do not do it.

There is within this context a specific subgroup of facilities that require our assessment: The community-based, independent health care facilities. These are funded through the health care system, along with the hospitals, but are unfairly treated in the tax system. In Ontario, Alberta, British Columbia and Quebec, up to 50 per cent of all imaging procedures are done in these facilities, yet many of them are facing closure because of increasing costs and the low cost of our dollar. They are paying GST on their equipment and supplies, and they cannot recoup it. It is a tax that no one else in the health care system is forced to pay, only the independent health care facilities. This is an issue that needs to be addressed if we are to take some of the health care out of the larger institutions and spread it into the community. We need viable, independent facilities.

We have an archaic funding system that puts money in silos and prevents the efficiency in one specialty from crossing boundaries into another. Basically, that is the message I wish to give you. Our report has a number of recommendations. I will summarize them in three broad categories. First, we need a collaborative approach to solve our issues. It is not just a radiology issue; it is a system-wide issue. We need, as radiologists, to get together with all the other professionals and discuss the issues with government, all levels of government. We will not solve the problem if we do not. This has been successfully done in some other provinces.

Second, we do need at this point in time a certain amount of funding to fix the things that we are putting Band-Aids on now.

Third, we need very badly to address the manpower issues, both amongst the radiologists and technologists, because these two are intertwined and cannot be separated.

Mr. Martin Zelder, Director of Health Policy Research, The Fraser Institute: I am delighted and honoured to be back here today speaking to you on this compelling and important topic. My brief and my remarks today address the fundamental question: Does the Canadian health care system provide the right amount of various medical technologies? By "right amount", I mean economically efficient amounts. I will get to the precise details of that in a moment.

This seems like a fairly simple question to state. Are we getting the right amounts of these technologies? It is a far more difficult question to answer, but it is vitally important that we do so.

In the words of one leading health economist, the alternative to not answering this question is to proceed blindly. Why is there such difficulty in answering this question? One reason is the intrinsic nature of technology. It is characterized by rapid innovation and rapid obsolescence. The material that we are studying is changing rapidly. By the same token, analysis of technology falls into the same mould. It is characterized by frequent innovation and frequent obsolescence.

The second major reason that this question is difficult to answer is that the analysis required to give a comprehensive response is complicated. It involves fundamental understanding of medical, statistical and economic concepts and methods.

For these two reasons, the relative newness and fluidity of much important medical technology, and the analytical demands on researchers, economic assessment of technology is in its relative infancy. At the same time, there are many talented people working in this area, so this "infant" has a good prognosis.

These caveats aside, the amount that we know about the daunting nature of the task is not inconsiderable. That knowledge can be divided into two basic categories: the basic facts of the situation, and some analysis of these facts.

After I discuss those two headings, I will offer some brief commentary and recommendations. All of that is spelled out in more detail in the brief.

What are the facts? Compared to other OECD countries, Canada offers extremely low rates of availability of most basic technologies measured by the OECD. If you turn to table 1 following page 16 of the brief, you see that this is essentially an updated version of the tables that were contained in our 1998 technology survey. It shows little change between that time and now. Availability is measured as the number of machines per million population. Thus, we see that Canada is 20th of 29 countries in availability of CT scanners, 21st in availability of MRIs and 20th in availability of lithotripters -- machines that break up kidney stones. Canada is better by this measure in availability of radiation equipment, where we measured sixth and ninth in hemodialysis stations.

At the same time, it is important to note that Canada's rank in the OECD in terms of health spending is near the top. For that particular year, 1997, we were fourth in per capita spending, and fifth in spending as a share of GDP. This tells us that Canada's levels of technology are disproportionately low given its spending.

Availability of advanced technologies is also limited. That data in table 1 is the more basic technologies. We also looked at the advanced technologies in our original report. I do not have updated figures on those today, but the data from the earlier report is contained in the brief in table 3. This reports on advanced technologies that were unavailable in any British Columbia hospital at that time, but were available in some hospitals in both Washington and Oregon, the nearest neighbours of British Columbia.

Thus, there are 18 of these unavailable leading edge technologies, which are listed in table 3. The deficit is in terms of basic technology and more advanced technology.

Given the amount of technology available, access in Canada is substantially limited by waiting time. In table 4, I have listed the time that a typical patient must wait after they have already consulted with a radiation oncologist and before they receive treatment. We see that for 1999, the typical waiting time was over six weeks between an appointment for consultation with the radiation oncologist and actual radiation treatment. It was as long as nine and one half weeks in Quebec. We see that overall, this was a substantial increase over 1993 -- 69 per cent increase in this segment of waiting time between 1993 and 1999.

Of course, in addition to this second segment of waiting time, after you have seen the specialist and before you are treated, there is an initial segment of waiting time -- typically three weeks between seeing a GP and consulting with an oncologist in the first place. Therefore, presently, the typical waiting time overall is over nine weeks. This partly reflects the unavailability of radiation equipment. In our survey, we asked radiation oncologists what the reasons were if there were greater waiting times. Of the oncologists who in 1999 said, "Yes, " 66 per cent said that one reason was that they were unable to gain access to radiation equipment. Direct unavailability of the machinery was a substantial reason.

Sometimes Canadians travel to the U.S. for treatment. We asked the doctors what percentage of their patients received treatment in other countries in a given year. In 1999, the radiation oncologists had the highest percentage of any specialty -- 4.5 per cent of their patients were going to other countries to receive treatment. Some of this travel was organized by the provinces, and that, of course, has been well publicized. That compares with only about 1.5 per cent of patients, on average, travelling to other countries to receive treatment across all specialities. This is a particularly big problem in radiation oncology.

Table 5 shows that waiting times for CT, MRI and ultrasound scans are relatively long and are growing. In particular, the current waiting time for an MRI is 12 weeks and five weeks for a CT scan. All of those figures have grown by more than 40 per cent since 1994.

These are some basic facts.

Now let me turn to analysis. The most popular approach to analysis is called "cost utility analysis." In it, one compares a new medical intervention with an existing standard intervention. The comparison occurs along two dimensions: cost and outcome. The cost measurement is intended to be comprehensive, that is, not just the direct medical cost, but also indirect costs of lost income, and pain and suffering. The outcome measure is "quality-adjusted life years." This indicates the benefit of medical intervention. It indicates both how much longer a person is expected to live and with what quality of life. Therefore, a value of one for a quality-adjusted life years measurement means that you will have an additional year of life with no impairments or disabilities of any kind. A value of zero is equivalent to being dead, and values between zero and one indicate some degree of disability.

The difficult part then is to value these intermediate states between perfect health and the worst possible state, where you may just as well be dead. How bad is it to live for an additional year if you have weekly hour-long migraine headaches? Economists have developed elaborate methodologies to try to answer these questions. They ask people to rate different disabilities on a 10-point scale. For example, they ask people how many years of life with a particular disability would they be willing to give up to have one year of life with perfect health. Through these mechanisms, we can value how many quality- adjusted life years correspond to different disabilities.

We can evaluate new technologies and new medical interventions in terms of the dollar cost that must be incurred per additional quality-adjusted life year. There are now estimates of these dollar-per-quality-adjusted-life-year values for a number of different interventions. Table 8 gives some examples that pertain to technological machinery. This data, as I note, comes from the Harvard Center for Risk Analysis -- a real paragon in the field. Most of these estimates, if not all, are not the original research of the Harvard people but, in fact, work done by other researchers, which the Harvard people evaluate. They question whether the estimates are good. They determine the exact nature of the estimates.

On table 6, you will see that when you compare new and existing treatments, you get four different types of results. In some cases, the new treatment gives more quality-adjusted life years, QALYs. It also involves lower cost. That is in the upper left-hand corner of the table. Those interventions are referred to as "cost saving." You get better results at lower cost.

However, some interventions offer fewer QALYs at higher cost. That is in the lower right-hand corner. Those interventions are referred it as ones that are "dominated." They are worse on both quality and cost dimensions.

The most typical case is to get more QALYs at higher cost, and that is in the lower left-hand corner. The lower right-hand corner almost never happens, that is, fewer QALYs and lower cost.

The Harvard group has published an evaluation of about 650 treatments in terms of the dollars per quality-adjusted life year. From this list of 650, they pull out 228 that they say meet particular methodological standards. They say that they are well-done studies that meet certain methodological criteria. These are called "panel worthy studies."

I have pulled six of those studies and put them in table 10. These relate to technological machinery, showing the dollars per QALY.

I urge that we take this data from leading sources like the Harvard centre. We should try to come up with a rule to determine which interventions justify their costs. Those interventions that justify their cost should be accepted for treatment. The others should be rejected.

In order to do this, we must come up with some cut-off value. How many dollars are we willing to pay for a quality-adjusted life year? Again, there are methods for doing this based on the statistical value of a life. I did some back-of-the-envelope calculations and came up with a value of about $80,000 per quality-adjusted life year for Canada.

One may quibble with the precision of the estimate, but my point is that we should make such an estimate on a principle basis. We should determine how many dollars we are willing to pay per quality-adjusted life year. We should look at a table like the Harvard table or any other reputable research we can get. We can then determine that all interventions that cost more than this figure, $80,000 per quality-adjusted life year, would be rejected for being too expensive. Everything below that line would be considered interventions that we should undertake and are worth it to society. They are efficient.

Before coming here today, I undertook some original preliminary analysis of data to attempt to determine whether Canada should add to its stock of medical technology. I took the OECD technology availability numbers from table 1. I estimated the effects of increases in availability on life expectancy among the OECD countries. Do countries that have higher availability of technology have longer life expectancies? I took account of other differences among the countries in health spending and consumption of alcohol and tobacco.

What did I find? I found that an increase in the number of CT scanners per 1 million population led to significantly higher life expectancy at the age of 60 years, but not higher life expectancy at any other age.

This implies that CT scanners play a measurably important diagnostic role for those between the ages of 60 years and 65 years. I also found beneficial effects at most ages for radiation equipment; and beneficial effects at the age of 40 years for dialysis stations.

Returning to the estimate for CT scanners, I found that an increase of one CT scanner per million population would lead to an increase in life expectancy at the age of 60 years of about one month. From this, I was able to calculate the value of this intervention in terms of life years saved by applying their statistical value. I found a value of life saved of $75 million.

How did this compare with the cost of adding one CT scanner? I did some research into this. The cost of adding a CT scanner -- purchasing and maintaining it for its life -- would be about $8.5 million.

Therefore, my estimate is that by adding one CT scanner, Canada would benefit by $75 million in expanded life-span at a cost of only $8.5 million, a ratio of benefit to cost of eight to one. I should note that this ratio of benefit to cost struck me at first as implausible. It seemed to be just too big.

As I mentioned in the brief, there is a new book containing contributions by a group of leading economists. They try to estimate the value of medical research in the U.S in terms of enhanced life expectancy compared to cost. Their estimates are that medical research in the U.S. annually provides benefits that are 35 times the cost of the research. My benefit ratio of eight to one does not seem ridiculous in that context.

These amazing numbers tell us that life is valuable, and that technological advance is very potent.

One last piece of evidence regarding the value of technology comes from my recent research on the effects of government health spending. The Fraser Institute published my report last year. In it, I looked to see whether provinces that had spent more money had shorter waiting times or provided more procedures by specialists.I found that more spending did not have either desirable effect. It did not lead to reduced waiting time or more procedures being done by specialists.

I then broke down spending into categories. I found one type of spending that that did increase the number of procedures that a province did. That was spending on capital. Capital, of course, includes technology.

The Chairman: I would ask that you get close to winding up.

Mr. Zelder: Given these facts and this evidence, will this data help us make better decisions in Canada? Given the current configuration of the system, I would be cautious as to whether we will in fact make better decisions, given this evidence.

There is a growing literature in the U.S. that looks at the impact of regulations that restrain reimbursement and that require bureaucratic approval for new technology purchases. These regulations restricting technology purchases and restraining reimbursement tend to retard technology adoption without necessarily lowering costs or enhancing efficiency.

This research directly bears on the Canadian situation. We have a system where reimbursement for procedures does not clearly correspond to their value to society. Our system demands that health ministries or regional health boards must often approve technology expansion. Even in the cases where hospitals could decide autonomously, they have blunted incentives to do so because of their inability to make profits.

The nature of health care decision making in Canada was best expressed 15 years ago by one expert who said:

A major characteristic of the Canadian health system is that although a variety of policies promote cost containment, very few promote efficiency.

My finding is that capital spending is the one thing that increases the number of procedures that can be done. Of every new health dollar, only two cents is spent on capital.

In conclusion, no matter how compelling and useful the evidence we accumulate from economic analysis of medical technology, we must question whether it will be put to use in today's Canada. My answer is that it will be put to use only with reforms that reward decision makers, including patients and hospital administrators, for making economically justified decisions. If that occurs, the answer to this question is yes.

Dr. Jill Sanders, President and CEO, Canadian Coordinating Office for Health Technology Assessment: It is a pleasure to be here. I see my role today as providing some information about our little organization, and the role it plays in the decision-making process regarding health technologies in Canada.

Our health care system has many research and advisory bodies. For our part, the Canadian Coordinating Office for Health Technology Assessment, CCHOTA, is trying to help governments make difficult decisions with regard to the adoption and the use of health technologies and drugs.

In our field we use the term "health technologies" as encompassing drugs. I will add the word "drugs" from time to time, but I am including it when I use the word "technologies."

The Chairman: To be clear, you use "technology" to include pharmaceuticals.

Dr. Sanders: Yes. I have tried to add it, but because we do not normally add that term, I may skip it occasionally. Please keep this mind that it does include pharmaceuticals.

For more than a decade, CCHOTA has provided thorough reports that look at the technologies in health care from a broad sense, including devices, equipment and drugs. The research is working in this growing field internationally, using an interdisciplinary approach to look at issues that include safety, efficacy and cost effectiveness as they pertain to health care technology usage.

I will take a minute to share some observations with you as to where we are in Canada with respect to health technology assessment, and offer some notes as to where this might lead us in the future.

As you are aware, devices and drugs must first be licensed by the federal government before they can be sold in Canada. However, the decisions about the public funding for these technologies are largely made by the provinces and territories. The decisions that need to be made have increased in number and have become increasingly complex in recent years. The decision-makers must deal with an increasing number of products competing for those public dollars.

Taking an example from the pharmaceutical area, a few years ago CCOHTA wrote a report that contained conclusions regarding the effectiveness of an entire class of drugs known as statins. These drugs are the cholesterol busters -- to lower cholesterol. However, they vary widely in price. In the province of British Columbia, two statins are the second and third most costly drugs for that province, and they accounted for over $40 million of the drug costs in 1999.

Similarly, when it comes to medical devices, over 900 Canadian companies alone are involved in the production of devices. They often develop products created for the same purpose, but sometimes vary widely in price -- sometimes competing with drugs or sometimes competing with nothing. These are difficult decisions. If governments do not have access to quality, independent information about the relative safety, efficacy and cost effectiveness, it is difficult to make wise decisions with respect to the use of taxpayer dollars.

More health technologies and drugs are appearing all the time, and they are moving into the development and marketing phase much faster than they used to. For example, in 1995, Health Canada issued 378 notices of compliance for pharmaceuticals. In the year 2000, that number had increased to 457. In other words, almost 500 new drugs, or new uses for old drugs, are approved annually. It is a staggering number for the decision makers to deal with, and the numbers continue to grow.

Similarly, Health Canada estimates that another 25,000 new medical devices appear on the Canadian market every year.

Things that may have been inconceivable last year, have the potential to be in practice next year, because the rate of development of technology is so fast.

An example of the physicians' response to a recent Angus Reid Group survey was that 40 per cent of family doctors, last year, believed that human cloning would eventually become accepted medical practice; and 90 per cent believed that cloning for body parts would become accepted medical practice. The effect of this acceleration is dizzying to those who are charged with these difficult decisions using public funds, and, of course, the impact is felt financially.

Taking prescription drugs, again, is an example. When CCHOTA was established just over 10 years ago by the deputy ministers of health, the budget for prescription drugs in Canada at that time was $4.2 billion, with about $1.9 billion of that from public funds. Today, that number has tripled to $11.4 billion in prescription drugs in Canada, with about $4.9 billion of that being paid by public funds. In other words, the governments now spend nearly as much on prescription drugs as they do on services provided by physicians.

An additional factor for public payers is the increasing savvy of an educated public, which of course is a good thing. People access and understand health information at a far more sophisticated level than even a decade ago. Mostly, this is as a result of the Internet, where there are currently 40,000 health Web sites. People are accessing these at a fairly high rate.

We can hypothesize. We heard about the babyboomers aging -- the "me generation." The other aspect is that we place a far stronger demand on the system for access to technologies. We expect solutions. We have been raised in an era where we have been trained to expect solutions to problems. We are moving towards a more patient-driven health care system as a result of that savvy and a more demanding population.

At a the same time, the health care providers, particularly in some sub-specialities, are eager to adopt new technologies. The overall impact of this is a strong market pull for technologies and drugs. Given all these pressures, how can those entrusted with spending our public health care be assisted with these decisions? What do they base these decisions on?

I refer you to an environmental scan conducted recently by CCHOTA and four other national health organizations this last month. In the scan, the researchers found that health technology assessment ranked as one of the top six health research priorities in the system today. This did not surprise too many of us and, in fact, it was anticipated by the deputy ministers of health who increased our funding and re-endorsed CCHOTA less than a year ago. This is interesting.

Many of those surveyed, particularly at the regional health authority level where I think they are feeling overwhelmed, cited an inability to keep pace with advancing technologies and the need for more accessible evidence to help them make those decisions. They singled out the need for more information, particularly for emerging drugs and technologies, including data on cost effectiveness. They also need far more economic data. The decision makers need information that is high quality, reliable and, obviously, incorporates economic, social and ethical consequences. It needs to come from a body such as ours that is independent of government. We receive our funding from government, but we are independent of government and other external influences such as industry.

Our work plan includes continuous technology assessment, which ensures that technologies are evaluated early enough so that funding decisions can be made before the technology has been completely disseminated and distributed into the health care system.

In terms of horizon scanning initiatives, our Canadian Emerging Technology Assessment Program, which is where we look for new developments in the world, produces and quickly disseminates information on new developments as they come along. This allows the decision makers some time to plan and control the introduction and diffusion of new technologies that have sometimes significant impacts on the system.

The effective and robust assessment processes that are employed begin with the rigorous selection of these technologies to be assessed and proceed all the way to the dissemination of the results.

Awareness-building activities, which CCHOTA has undertaken, are designed to educate stakeholders, including the payers, the physicians and the public, about the findings or assessments.

CCHOTA is not the only body performing health technology assessment in Canada. There are provincial bodies as well. One of our significant roles is to coordinate the effects and the results from all of our bodies and agencies to avoid duplication. We also cooperate and coordinate internationally to try to avoid duplication and to speed up the transfer of results and findings to our stakeholders.

In conclusion, the challenges that led the deputy ministers of health to create CCHOTA 11 years ago are more relevant than ever today. In the future, it will be critical for decision makers to have access to this quality information, particularly if we are looking at spending more and changing our spending They will need access to this quality information about the relative benefits of drugs and the technologies in order that the health care dollars will be spent wisely.

Professor David Feeny: I have provided you with my paper and a handout containing overheads. Thank you for inviting me to participate today. In the past, I have done a lot of work that has overlapped with the work of CCHOTA, and I am happy to follow on that presentation.

I will try to cover five themes.

The Chairman: I must ask you to stand closer to the microphone. This is on CPAC, and they need to pick up your voice.

Mr. Feeny: I will cover five themes, perhaps too much. The first theme is a little different than the following four. It is about how we generate knowledge for the development of new health technologies. The other themes are about production of health technology assessment evidence and getting that evidence into active decision making for evidence based policy making.

At the risk of some oversimplification, we can talk about two basic kinds of research -- basics and applied. Basic research is about fundamental underlying mechanisms that is the structure of the DNA molecule and how it repairs itself. Applied research is using that knowledge to produce a new product or process.

We can talk about two different kinds of technologies. Embodied technologies are where the innovation is captured in the physical artifacts, like a magnetic reconance-imaging machine. You can understand how it works, but if you do not have the machine, you cannot do it.

Disembodied technologies are ideas or procedures. You do not need to buy something in order to use them. There has been very little of that discussion here today. Disembodied technologies are thing like early embolism following surgery for deep vein thrombosis. The nurse tortures the patient by making him get right out of bed, and it is good for them. You do not need to buy something from anyone to do that. You only must learn that idea.

In a regime of intellectual property rights, patent copyrights such as we have in Canada, the private sector has a lot of incentive to develop new embody technologies. They can patent new drugs and new equipment.

The private sector did little to discover the underlying the underlying mechanisms of DNA and the DNA molecule and basic techniques for recombinant DNA, but was very happy, and appropriately so, to invest in developing recombinant DNA techniques to produce human insulin.

The private sector will not fund much basic research because there is a low rate of return to them in doing so. The private sector will not fund research, basic or applied, on disembodied technologies because there is no product to sell. Yet, when you look at recent trends in Medical Research Council of Canada, provincial agencies and the new Canadian Institutes for Health Research, as academics, we are highly encouraged to enter into partnership, mainly here but also with the disembodied, with philanthropic organizations.

The thrust of the trend in research in Canada is that increasingly the dollars are encouraging partnerships at the applied level at the expense of disembodied and basic. That will have repercussions down the road for the kinds of new technologies that do and do not appear in the system.

The concept of health technology is broadly defined as a set of techniques, drugs and procedures used by health care professionals in delivering medical care to individuals, and the systems within which such care is delivered. It is abroad definition that clearly includes drugs. As Dr. Sanders said, we need more health technology assessment activity.

This is a simplified kind of framework, but it if says that we start out with a problem. We look to see if that problem can be modified. We look then to see if we have an efficacious technology to address that problem. You have hypertension, we have efficacious drugs. Do we have a way of screening and diagnosing? Do we have a way of finding the people who have it and those who do not?

We then look at how well it works in practice, and determine what efficacy is about when you do it under ideal circumstances. You compare that to efficacy approach in the community where not every one does everything exactly the way that they are supposed to do it, and determine how well that works. We determine the costs in efficiency and consequences of using the technology relative to the exist being technology in that way. That has implications for how much of this should be used and for whom. If you are actually solving problems, you should be able to go out and find a reduction in the prevalence of untreated hypertension in the community. You can set targets for your outcomes. After, you monitor again.

This has several implications. One is that health technology assessment is about efficiency promotion, not cost containment. Two, it is a perpetual motion machine. Once you have reduced the prevalence of one problem, you then look at the next problem or what is the next agenda for that particular problem.

One of the advantages of agencies like CCHOTA and the provincial agencies is that they are connected to decision-makers. That enhances the uptake of the research and evidence that they synthesize. It also puts them in a very good situation to identify the gaps.

Mainly what the technology assessment agencies have done in Canada is synthesize the best available evidence. That process gives you the immediate answer, and also identifies things for the research agenda -- would it not be nice if we knew how well this works in this circumstance.

Yet, the funding/granting agencies do not respond to that agenda. One of the things that we need to do with our health technology assessment agencies is to give to them the wherewithal to sponsor primary studies, such as randomized control trials to sort out some of the issues that they identify.

Health technology assessment to date, and I am guilty of this as well, is largely focused on a yea or nay decision about a technology. That is an oversimplification of the issues, frankly. Very few health care technologies are universally useless and very few are universally useful. The real job is figuring out for whom and under what circumstances is this the better approach to take, and when is it not. We need to identify the indications and contra-indications for the use, broadly defined, of this technology. That is the kind of evidence that we need to generate for people who have to make decisions throughout the health care system.

We need to broaden the scope of assessment. We have done a good job of synthesizing clinical effectiveness and economic efficiency evidence. Little social, legal, and ethical considerations have been brought to bear.

We need some research on how to adapt offshore results, such as the compendium that Harvard put together for use in Canada. The efficacy of the technology may generalize, the effectiveness may not, and definitely cost will not. A U.S. cost effectiveness analysis is not Canadian one. There are different relative prices embodied in those cost figures than exist in Canada.

The third theme is where I currently work, so this is one of my bugaboos. By and large, the health care sector does not really push mortality around a lot. In some cases it does, but by and large the health care sector produces health-related quality of life.

It seems like a simple proposition then. If that is what you are actually producing, perhaps you should measure it more often. We do some of that. Over the last three decades there has been a revolution in psychometric and economic fields in developing useful measures of health status and health related quality of life. However, they are not used nearly as universally, and they are seldom used in routine care.

The Chairman: I will ask you one question. How does your health-related quality of life compare with Dr. Seller's definition?

Mr. Feeny: I will show you an example of that just now. That is one example of a measure of health-related quality of life, one on which I have done a lot of work.

This data is similar to that presented to you by Statistics Canada earlier this year. You are all familiar with life expectancy. A 60-year-old can expect to live another 24 years, but not all of those years will be enjoyed in perfect health. On this scale again, perfect health is given a score of one; dead, or the lack of health status, is given a score of zero. Intermediate disability states get intermediate scores. I can go on at great length about how we do that, if you would like.

For 60-year-olds who will live another 24 years, their health-adjusted additional life expectancy is 17 years. They will spend some of that time with some disability. The health-adjusted life expectancy over their life expectancy is 74 per cent. That is pretty good. It is much higher at younger ages, and much lower at older ages.

Statistics Canada, because it has used the Health Utilities Index Mark 3 system in its national population health survey, is in an enviable position worldwide to actually have a national report card on the health status of Canadians, one that integrates mortality and morbidity, both of which are rather important to people.

I will now touch on theme four. We have some methods -- economic evaluation, health-related quality of life, clinical epidemiology -- to generate useful evidence for decision making. How do we get that evidence to people who actually have to make decisions? Health care is an enormously decentralized industry. You have all these health care professional-patient interactions, regional health authorities, ministries and the federal government. You know that well.

One way is to involve decision makers in the design and analysis and interpretation of evaluation studies. Give them ownership. Let them help you ask what the relevant questions are. Let them be part of generating that evidence. They are much more likely to pay attention to it.

Two, we all know what we should do, but if we are over-prescribing a medicine when a better alternative that is cheaper is available, we need some monitoring and feedback. We need to be confronted with the fact that we are not using this according to indications or a variety of indications.

Three, we need to invest in the capacity to understand health technology assessment evidence. Many practising clinicians do not particularly understand it, although their understanding has increased over recent decades. Frankly, industry has become much more sophisticated. My interpretation is that often government is not particularly sophisticated in understanding this evidence, which again reduces the level playing field because one party understands the evidence well and another does not.

Finally, and this is something the pharmaceutical industry understood long ago, the health technology diffusion evidence historically indicates that human beings are important, even in the Web days, to disseminating information. Detail persons are sent around to flog new medicines at physicians' offices for a reason, and that is, people tend to believe things they hear from a person. They may be corroborated in a written form or on the Web, but they need personal contact to embrace new ideas. We do not do a lot of that in the public sector.

Finally, you can generate new evidence, but will they come? Will it affect policy? Our system often discourages and does not necessarily encourage the use of evidence in making clinical policy decisions. Some policy experiments that you might try to enhance the use of that evidence and the efficiency of the system are devices to more organizational changes, or disembodied technical change, to more closely align the financial and clinical responsibility and alter the behaviour of health professionals.

Capitation patient rostering may be a device along those lines that might be useful and would go to also encouraging the use of multi-disciplinary clinical teams. Many times the Canadian health care system uses highly trained, expensive physician time to do things that other health care professionals who get paid less can do as well or better, but the current fee-for-service system does not encourage the use of people like nurses, nurse practitioners, physiotherapists, dieticians and pharmacists. Some experience with multi-disciplinary teams indicates that in many situations they do a better job. They exploit the differential expertise of different members of the team, and perhaps more importantly they exploit the fact that different members of the team see the patient in a different context. The home care nurse and the pharmacist who does a medication review and history at home, gain insights about what is going on in the patient's life in their compliance with drugs which is something physicians cannot see in their offices. It is not a question of being conscientious or anything; they just cannot see that. With a team, you have the incentive, in a forum, to share those ideas.

In sum, we need to refocus some of our public sector research efforts towards basic research and disembodied technical change. We need to bolster health technology assessment. We need to contemplate and do policy experiments on changes in health care organization to promote evidence-based decision making.

The Chairman: Before turning to senators for questions, I should like to ask two questions. Anyone can begin to answer. In Dr. Zelder's closing comments, he observed that Canada spends two cents of every dollar, 2 per cent, on capital. I took "capital" to mean "new equipment." I took the statement to mean that government spends 2 per cent of our health care expenditures on new equipment. Is that what you meant?

Mr. Zelder: Yes. I was referring to the definition of capital used by CIHI, which is spending on construction and on new equipment.

The Chairman: That includes hospitals as well.

Mr. Zelder: It would include hospital construction as well. The 2 per cent figure comes from a statistical analysis. Controlling other factors, when we increase spending, how much does capital go up?

The Chairman: I want to talk about technology. Does anyone have any data, or can you get it, on the percentage of health care budgets that go to equipment, taking buildings out of this, in various OECD countries? I understand Table 1 talks about numbers of units per million population. I am not sure whether counting up the number of machines is the right way to do it. It seems to me that one machine could often do the work of 10. I am not sure that is the right measure. A better measure is probably the dollar count.

Mr. Zelder: I do not know that that exists. Some of the other panelists may know. We are comparing apples and oranges, to some extent. That was part of the Dr. Radomsky's point about the obsolescence of existing machines. I do not know.

The Chairman: Could I ask anyone else where that number stands?

Dr. Radomsky: I do not believe we have that information.

Mr. Feeny: I suspect that will be difficult information to obtain. There is probably some fragments of it out there but, particularly in the Canadian system, the way our accounting system goes, it does not lend itself to generating that kind of data.

Dr. Sanders: To further build on that point, I think finding that data from other countries, where there is far more of a public and private mix of spending, would be very difficult.

The Chairman: So much for that dead end. Let me try something else.

Mr. Zelder: Life as an economist has many of these data dead ends.

The Chairman: Economists always have two hands. One of the problems in public policy is you have to choose one. You guys always say, "On the hand," and then "On the other hand."

Let me ask a question about the measurement of the effectiveness of methodology, which all of you touched on in one way or another. I do not want to get off into my views on whether or not economists can measure what they claim they can, but in the health care sector as a whole, is there an accepted way of measuring the cost benefit of a particular new piece of equipment, or is everyone doing their own thing?

Mr. Zelder: In the academic world, certainly the dollars per quality-adjusted life year or the kind of variations that David Feeny was presenting are pretty well established. There is a lot of that. That tends to be the way in which different interventions are presented, but that is just the academic world.

Mr. Feeny: There is a fair amount of consensus about a variety of reasonable ways to generate evidence on cost per quality- adjusted life year or, more broadly, health-related quality of life. There is a menu of things to choose from. There definitely is controversy, but there are a number of well-accepted and well-validated approaches that work well on some very difficult parts of the puzzle. However, they are still incomplete, typically, with respect to the full comprehensive information you would like to have, yet they are an amazing step forward relative to what was available two or three decades ago.

Dr. Sanders: I agree.

The Chairman: When you are assessing a piece of equipment for the various deputy ministers across the country, what information do you give them? It is clear that you are only an information provider, you are not a decision maker. What information do you give them on which they base their decision?

Suppose, for example, someone comes up with a new CT scan machine. You do your assessment of it. You then phone the Department of Health or send a memo to all the departments. What do you tell them? What are the actual facts on which they base their decision?

Dr. Sanders: Our reports end with conclusions and never recommendations, as you are probably aware. Essentially, we will determine the cost effectiveness using the economic methods, et cetera, that Dr. Feeny has mentioned. Intercomparisons between different types of approaches are another thing, where we use complicated methods to compare apples with oranges. It is not simple. Drugs are so much easier to describe. I do not think that is what you are asking me, but they are easier.

Going back to that statins report, where we looked at the cost effectiveness of each drug, we concluded that you could interprescribe, in the sense that they all have the same effect, even though they were widely different in price. We are able to do that with drugs.

It is a little harder with a piece of equipment. It is made harder by the fact that there are not the random control trials to which Mr. Feeny referred, because there is no one to pay for those at this point, whereas the drug industry pays for theirs. It is difficult.

Mr. Feeny: If I can elaborate on that point, it is not easy but easier to evaluate therapeutic technologies.

The Chairman: What do you mean by "therapeutic technologies"?

Mr. Feeny: I mean things like drugs or surgery that are meant to make you better. What is the existing technology? What is the new technology? What does each of them cost? What are the additional consequences? How much do you get relative to the existing technology? You have one chemotherapeutic regime versus another, for instance, in oncology.

Diagnostic technologies are much more difficult because they are used for a wide variety of things. The question is not how good is a CT scan. It is relative to, say, cranial x-ray. How good is a CT scan for head trauma? It is probably really good. For some other use, a CT scan may be much more expensive and not much more helpful than a standard x-ray.

Therefore, given the wide variety of things that radiologists do, it becomes very complicated to evaluate a machine because it is used for so many different things. Each of those major uses then becomes a research topic. That is one point.

The Chairman: By the time the research is done, the machine is obsolete.

Mr. Feeny: No, particularly because they are kept for so long. Number two, it is one thing to say this is a much better image in radiology, but does the quality of that image affect patient management? Do the treating physicians do anything differently because of the diagnostic information provided? Very few radiologists have answered that question.

Number three: the next chain in that step is, just because the treating physicians are doing something differently, does it actually affect patient outcome? Very little evaluation of therapeutic technologies has gone that fuller road to figuring out if the use of this diagnostic technology actually affects patient outcome. We have very little evidence of that nature.

Dr. Radomsky: I am enjoying this discussion because it touches on an area that we have been working on unsuccessfully for some time. That is the development of guidelines, evidence-based medicine. This is multidisciplinary. We have been very successful in developing standards as to how we should do a procedure. That is in-house. That is our own profession. However, we cannot develop appropriate guidelines by ourselves. It requires all the users. It requires people like economists and statisticians who have to work with us in each different examination. This is very expensive. We tried on two or three instances to provide guidelines for specific tests, but it is totally impractical. It cannot be paid for out of our pockets. This is something that requires input from multiple groups. This is part of our recommendations. That is why we have to get the whole crew together, so to speak, and face these issues together.

Often, the work that these people do is done in isolation from what we as clinicians are doing, and we do not understand what they are doing and they do not understand what we are doing.

Take the example of the statins. They may all lower cholesterol, but they do not all do it equally. Some have side effects that others do not. Many patients will not tolerate the same statin, and very few of these studies that indicate we should only be using generic equivalents, take that into account. That is a quality-of-life issue.

The same applies to the studies that are being done almost in isolation from the actual clinical work that we do with respect to the efficacy of our equipment.

The Chairman: I will tell you my take from the four of you.

If I were sitting as the CEO of a major hospital or even if I were a provincial deputy minister of health -- it is easier if I focus on a hospital -- and I had $2 million to spend on equipment, the people in the business you are in cannot tell me if the hospital is better off -- if patients are better off -- if I spend those funds on a CT scan, a machine for kidneys, or something else. In other words, fundamentally, as I hear you -- which is not belittling the work -- there is a lot of flying blind by the people who ultimately have to make decisions between purchasing A or B in totally different related fields because they have a fixed budget. Am I wrong?

Senator Morin: I do not think Dr. Radomsky agrees with that. I am surprised he remains silent. I think there is good scientific evidence showing that the equipment is in fact effective for disease.

The Chairman: Senator, you are missing the point. I am not arguing that the equipment itself is not effective. My point is that it must be a terrible dilemma to have to decide, because you have a limited budget, whether to buy an imaging machine or a dialysis machine.

Senator Morin: Or hire a nurse or paint the second floor.

The Chairman: I was trying to understand if even just choosing among pieces of equipment was an easy decision, and the answer is no.

Mr. Zelder: I would not be quite so pessimistic. One of the hopes of this analysis that I talked about, where I tried to determine whether countries that had greater availability of these different types of machines have a higher life expectancy, was that I would get estimates of exactly how much is added to life expectancy by adding machines.

You are shaking your head. It is not a perfect exercise, but it is what we are capable of doing, and it does tell us what the benefits are relative to the cost, and it would allow someone to make the choice. The question is whether people in the position of the CEO of a hospital or a deputy health minister will have the incentives to make those kinds of choices.

Senator LeBreton: Your comment is a perfect entré to my question. I will address the first question to Dr. Radomsky and to Mr. Zelder. In both of your papers you talk about the deficiency in the proper equipment, MRIs being one example. We have a problem at the front end of manpower and also with equipment. When I was listening to your presentation, Dr. Radomsky, you talked about education and dealing with the new technologies that are coming into the field.

What would be the ideal situation to get Canada's levels up. In your brief you talk about Third World levels and the fact that we are way behind all of the people in the OECD. How would we change the health care system to get this diagnostic equipment? As someone mentioned, the public is well-informed and waiting lists are growing. How do we change the psyche around to get the proper equipment in? How do you, as radiologists, deal with this situation where you do not have enough people to handle the equipment? This is the fault of our education system. As we are training our medical students, we are not sending them off into the right areas.

Dr. Radomsky: The second question is relatively easy to answer. We have a shortage simply because we did not take into account the growing population needs. Collectively, we used cutbacks across the board in funding positions in medical schools and residency programs and nursing and technology programs. We used that as a means of limiting health care spending. It had the desired effect for a short time. However, as you know, it takes at least 10 or 12 years to produce a radiologist. We are turning out 70 a year and we need about 100 in Canada to maintain status quo. We can meet some of that need by work being within the current funding system to increase our efficiency. We need teleradiology facts and the information technology that has been denied in this sector of our economy. Every other sector of the economy where you have used the information technology it its fullest, you have realized significant cost savings. We have not been able to do that. As we use the technology and work to a situation where we try to use the best test first rather than multiple expensive tests or in the case of certain radiology treatments, it will become obvious that we will save a significant amount in the system that can be applied in other areas.

Senator LeBreton: You an the example at the beginning of your presentation about how the technology has changed dramatically within your own period of time as a radiologist. What about the people who are presently in your field? How do you bring them up to speed on the new equipment that is coming into use? If they are trying to deal with the shortage in the hospitals of proper diagnostic equipment and there are not enough medical students in your field, what do you do with the people that are presently in your field?

Dr. Radomsky: That is a major issue. I can explain this to you from practical experience. We just added an MRI machine. We were fortunate enough to be able to hire one or two new young graduates who were fully qualified, but that is not enough. Several of our people had to go back and spend a minimum of three to six months training to qualify. That was done at their own expense, while they were out of circulation and not able to provide service. We are faced with that again when someone retires. We must replace that specific skill. What are forced to cancel procedures, cancel patients and work harder in order to give an individual the three months required to upgrade the skills to do the procedure that he will be replacing. That is a major problem in the system. I do little now that I was taught to do almost 30 years ago.

Senator LeBreton: That, then, would contribute to the whole length of waiting times.

Dr. Radomsky: That is correct. There are some things we can do to speed up the process of putting new people through. They are outlined in our document. We need to address the foreign medical graduate issue. There may not be many who are actually qualified in Canada to do the work that we do and many of them simply cannot be brought up to speed. That was aptly demonstrated by our colleagues in Quebec. They took several people qualified in certain foreign countries and tried to bring them up to speed to Canadian standards. Unfortunately, they did not have the background. That pool is limited. There is another pool of physicians who want to change jobs. Traditionally, that was the source of at least 25 per cent of radiologists. I am an old GP. That door has been closed effectively because the medical students now must make their choices by the third year. It is very difficult or almost impossible for them to switch. That is another avenue that needs to be explored. There are a number of things that we can do to help the situation now. I hesitate to recommend going to other countries and actively recruiting. I personally do not think that is fair. Some other countries have complained about us for doing that.

Senator LeBreton: I do not think a day goes by without hearing someone on the radio talking about the fact that if they had a MRI, there would have been a different outcome. People are waiting too long to be diagnosed. If they had be diagnosed, they would not be so sick. Mr. Zelder, what would you suggest the governments and health care providers do?

Mr. Zelder: I think the fundamental issue is structural. We have a system of allocating resources to health care which is one of centralized bureaucratic control; that is, setting of prices, setting of reimbursements, controlling availability and curtailing costs. The way to get the levels of technology and the numbers of personnel up to the right numbers -- that is, the numbers where the cost of having these people and machines in place is balanced by the benefits -- will be much better accomplished by a system where there are reforms to the incentives where the process for allocating resources for getting people and machines in place is not one of centralized command and control but is one based more on individual economic and market-based incentives. Hospitals can then make profits from having the right stock of machinery and people can control their own resources and spending for health care with medical savings accounts or, as in Britain, doctors and hospitals can have funds that they use to purchase care on behalf their patients. We need more financial control in the hands of the people who can actually benefit from the right amounts of technology and people in place.

Senator LeBreton: Dr. Sanders, following up on the question the chair asked, what do you tell them? He was talking specifically about equipment. When you look at the numbers on drugs, for example, from 1995 to the year 2000, and new equipment, there are huge numbers for your decision makers to have to deal with. How do you properly analyze and manage these numbers? How many people do you have that you can draw on? A huge amount of information is required before you approve a piece of equipment or a particular drug. How do we assure Canadians that, when these things hit the market, they have gone through a thorough check? I know that you are critcized for not moving quickly enough on some of them.

Dr. Sanders: Perhaps I should start by saying that a year ago our annual funding level was $3.7 million. We had a handful of researchers, and a few dollars for contracting out. That level of funding has been increased by the deputy ministers to $4.3 million starting this April. We have now increased our researchers to about a dozen.

More growth would answer more questions, more quickly. The answer to your question is that we do not look at all the drugs and all the technologies. The board of directors, supported by some advisory committees that are jurisdictional, determine the priorities. Representation is from each province, territory and from the federal government. We start at the top and we work our way down. We then rework the priorities every six months. We start at the top of that list and work down it for six months.

Increasing funding would be one answer. However, there is a limited pool of capacity. It comes back to this shortage of qualified personnel, so we also have to address that.

Worldwide, where does Canada compare in health technology assessment? To compare it with the U.K. for instance, the funding level into health technology assessment types of activity is about Can. $100 million. CCHOTA receives Can. $4.3 million, but there is also funding going into the provincial agencies. We would have to do an estimate, but we are looking at about $7 million overall in Canada. The number is very much lower, but the number of technologies is not any lower.

We try to cooperate with other agencies elsewhere. We have been doing that to some success with a new agency in the U.K. We exchange early drafts of reports and then cherry-pick what we can use out of each other's reports, thereby saving time and money. We are doing those kind of things with other agencies around the world.

Canada is the only non-European partner in a group called Euroscan, which deals with early warning horizon scanning. We invited ourselves to that. We share the databases. We are all out there scanning, and we just pull all the results.

There is a lot of cooperation going on in the field, but we do not address all technologies or drugs.

Senator LeBreton: Professor Feeney, your presentation tied in very well with that of the other three witnesses. However, I got the distinct impression when I was listening to your presentation that you are advocating preventative techniques. I got the impression that you would like to see more resources spent on diagnostics, at the front end, which is where you think we could have some cost savings. Am I right in that assessment?

Mr. Feeny: Perhaps. In most public systems, regardless of whether or not they deal with health care, the acquisition of capital equipment is discouraged. It comes under incredible scrutiny. It is plausible that we have underinvested in equipment. It is really a skilled labour-intensive industry; it is not really an equipment industry. We need to change the culture and incentives, both sociological as well as pecuniary, about the evidence that you have to present in order to justify obtaining the new program, the new equipment, or whatever, or at least the commitment to a process of evaluation to justify that ex post because that has information for the rest of the system. In this way, you can really demonstrate evidence of safety and efficacy, effectiveness, community effectiveness and economic efficiency, as well as dealing with some other equity issues.

I will exaggerate here in order to make my point. It used to be that when certain hospitals in Toronto wanted a budget increase from the ministry they would wheel patients out into the hallway and call the press in. This would justify getting a budget increase, which perhaps they really needed.

We need to change the playing field so the way to get that is to synthesize that evidence, borrow from CCHOTA and from offshore, if you have to, and say, "If we do this program, this is what the cost will be. These are the consequences and this is what we will give up to do that. What we are giving up is less than what we are getting. This is the target that we should achieve. If we are successful in this program, the prevalence or severity of the problem in people who have it will go down by this much. We want you to come back and we will all look at it together five years from now and see if we made those benchmarks or not." We need that kind of iterative problem-solving decision making throughout the system.

Senator Robertson: My main question is for Dr. Radomsky. I am most interested in the chart on page 4 which relates to outdated equipment. Technically speaking, can you describe to me what "outdated' means in your use of the word?

Dr. Radomsky: There is no uniform standard for what outdated equipment is. In the United States, the data we had was based on a six-year average. In some European countries, it is based on a 10-year average. I believe we used eight years. We have to be careful about this because, in general, when we do this type of analysis, the age of the equipment matches the functionality. If we say that 60 per cent of our equipment is outdated, using a specific time criteria, then functionally most of that equipment will be outdated and should be replaced because the wheels are falling off.

I will give you the example of ultrasound because this is the best example we have. Ultrasound technology is changing extremely rapidly. No one here is now using a 386 chip in your computers. It just does not do the job. The ultrasound machine that was state of the art even six years ago may not be adequate to do the diagnostic job that is required today. I am not sure if I use that example in my own practice. Several machines in one of our hospitals are approximately eight to ten years old. They were once state-of-the-art machines. They are maintained to that standard. However, when I find a breast cancer with my newer ultrasound machine in the office, I cannot find that same cancer with the eight-year-old machine in the hospital. Therefore, I cannot perform a biopsy on it. We have to use some other test or send the patient to some other facility, thereby increasing the cost, the anxiety, as well as inconvenience the patient.

In the final analysis, when it comes to any individual piece of equipment, we must make our personal judgments on the functionality. We believe that the functionality parallels closely the figures that we use here in this text.

Senator Robertson: With this particular table, then, you are saying that if I, as a patient, were exposed to some general radiography process, the results from an outdated piece of equipment would give you only 37 per cent accuracy? The difference there would be the accuracy of your diagnosis or the information that you got from that particular process.

Mr. Radomsky: I do not think we can make that correlation. That is not a statistically valid correlation. What I am saying, and what I can say, is that we know that we will have trouble with that particular piece of equipment making the diagnosis or providing the treatment. There is the potential to miss something that will be hazardous to the patient, and that puts us in an untenable position.

Senator Robertson: If I understand you correctly, then, this "outdated equipment" relates to what that machine would do when it was relatively new compared to a newer piece of equipment that would give you a much greater understanding or interpretation of your patients. The technology is outdated. It still does, perhaps, what it was designed to do eight years ago, but the new technology would do so much more. Is that correct?

Dr. Radomsky: That is part of it, yes. Also, as any piece of equipment ages, it is not able to always function at the same level at which it was designed to function.

Senator Robertson: I am from that school that believes this is probably one of the most important parts of the hospital or the clinic. I believe we have been negligent in this area.

What about what I call the hard technology -- these items we are talking about here? I read that Canada imports most of its hard technology.

Dr. Radomsky: Are you speaking about manufacturing and development?

Senator Robertson: Yes.

Dr. Radomsky: To the best of my knowledge, we have no home-grown equipment producers.

Senator Robertson: I thought so. Thank you for that information. It is important that we understand what having all of this outdated equipment means.

On page eight, of your document, Mr. Feeny, you talk about the report card on the health of Canadians. That is found in table 1. You go on to explain what you did in one of your slides. You say that a 15- to 19-year-old female can expect to live so many years in good health and so many years in not good health.

Do you deal only with statistical evidence in your work, or do you sometimes collaborate with others and ask: "What could we be doing differently in the health system that would change those percentages?"

Mr. Feeny: The intent of measuring that is to help focus policy questions. The National Population Health Survey looks at the health of all Canadians -- those living in the community and living in institutions. It is a national report card. What actually causes health to deteriorate or not deteriorate usually takes microstudies -- that is, much more focused studies on particular groups. There is other information you can get out of those sources. One is that health care is only a small part of what determines health status. The National Population Health Survey is a wonderful vehicle. Canada is in an enviable position, in terms of its measurement, for examining the roles of education, health and environmental exposure to determining health. That is one of the reasons I am skeptical of macro evidence on the effects of having more CT scanners available, or whatever. There are a lot of other things going on.

Other people are now doing linkages between data sets such as the National Population Health Survey and provincial utilization data sets. The same people are in both places and there are enormous confidentiality issues, but if you get the right linkage you can look at longitudinal trends in health status and in utilization of health care services and start to provide a more population-based answer as opposed to a clinical cohort to find the answer on what determines health status.

I have also been involved in a number of these technology assessments involving multidisciplinary teams, for example, nurses, physicians, economists and statisticians, and assessing the impact that the new technology therapies have on health-related quality of life and costs. One area that I have worked in is paediatric oncology. Many trials are about reducing the treatment burden -- that is, the health-related quality of life and burden of treatment -- and the problems in survivorship. That is to say, the conditions that people are left with. The name of the game is how to get people to survive, but have less burden while getting there and less burden living in that state, the outcome.

Senator Morin: I learned a lot this morning. I am extremely sympathetic to Dr. Radomsky. There is no doubt that Canadian radiology equipment is rusting. I have noted with interest that they now have lawyers in the game. I am not sure that that will reduce the cost. From what I have read in the newspapers, every time you do an exam you will have a lawyer sitting next to you. I am sure that will be comforting for the patients who hear all this.

It is interesting that two years ago the Canadian Association of Radiologists recommended the federal government contribute $1 billion. Unfortunately, I could not find the paper, but I believe the premise was that if we invested $1 billion into this, that would help solve the problem. Well, that was done. The government gave you $1 billion in addition to the $20 billion that it contributed to health care. Where did that money go? That is a lot of money. You can buy a lot equipment with that. Apparently, it is not sufficient, because the lawyers are now with us. How many additional billion dollars should we put toward solving the problem? Having said that, I am not being facetious. I fully realize there is a problem here.

In talking about independent health care facilities, are we talking about private clinics? Are we talking about for-profit clinics? Are we talking about clinics where patients actually pay to have tests done, which they could have for free, in order to jump the queue?

Mr. Zelder, you talk about waiting lists for radiation treatments and about patients going to the United States for radiation treatments. What is interesting is that we have more radiation equipment in Canada than they do in the United States. We have almost twice as much. The fact remains that we are sending our patients to the United States for radiation treatment. A large segment of those patients who are waiting for treatment and have decided to go to the U.S., are from Quebec.

Finally, it is a fact that that we are doing poorly in hard technology. However, if we use Dr. Sander's definition for technology and include drugs, we are doing well. We are third or fourth in the world as far as drug spending goes. We spend 14 per cent of our total health expenditure on drugs in Canada, while the U.S. spends only 8 per cent. Then there is technology assessment. If it is so structural, we would not be -- and I am not saying that it is not right -- spending far more in one part of technology while we are not spending enough on the harder technology. I agree that we are spending far more on one part of technology while we are not spending enough on the harder technology.

Senator Robertson touched upon the reasoning correctly. While we have a strong and innovative research and development drug industry in Canada, harder technology this is a weak sector of our economy.

I was interested to see the list Mr. Zelder gave us of leading-edge technologies that were not available in Canada but were available in the U.S. Most of it is related to research. Radioactive balloon angioplasty is research. That is not a proven technology. I am not saying it should not be done somewhere else, but a lot of technology assessment is trial and error. That is how equipment gets into a country. Canada does not do this. We are totally dependent. We are really Third-World in that regard, and that is a problem we should address. Countries such as Germany, France, and most European countries -- and you know this better than I do, Dr. Radomsky -- have their own equipment industry. That is the way to introduce and get new equipment. That is one area that Canada lacks.

My final comment concerns technology assessment. Technology assessment in Canada is extremely powerful compared to the U.S., and in other countries where they have a private sector, because we have a health monopoly here. There is no doubt that there has been in the past an anti-technology bias -- that is to say, technology versus person-centred care. I remember in Quebec what was written about the MRIs when they came out. It was said that they were expensive, there was no value to them and there should be only one MRI in the province.

I am certain that there is an anti-technology bias in those who are responsible for health policy in this country.

Dr. Radomsky: Your first question was: Where did the $1 billion go? We are here to find that out. Apparently, several of the provinces have not applied for their share. I think there was only $500 million in the first segment. The next $500 million will be given out after April 1st. Several provinces did not apply for their share, possibly because it required matching grants.

Second, there was no apparent accountability within the provinces as to exactly where that money was spent. We are not sure how much of it filtered down to high-tech equipment.

With respect to the total deficit, we indicated that to bring us up to a reasonable level of high-tech we needed $1 billion of new equipment across the country. That does not bring us up to American levels. That is roughly on par with other countries with similar economic status.

Third, this does not address the old car with the wheels falling off. We still have the old equipment which must be brought up to date because eight years ago there was a total halt in funding. That is approximately another $1 billion worth.

The Ontario Association of Radiologists put together a beautiful paper indicating exactly how much of each type of equipment they needed.

Another question you asked concerned private clinics. I specifically used the terms "community-based health care facility" or "independent health care facility" to differentiate from what in the press has become known as the private for-profit medicine that is totally outside of the plan. I was not discussing that segment. I am discussing those clinics generally operated by physicians working in the system that are funded on a fee-for-service basis from the system and that provide a quick, efficient service to the patient. That segment is in deep trouble because our dollar is down, we are taxed on money that we cannot recover, and we are forced to depreciate that equipment too slowly.

Another question you asked was with respect to technology assessment. I think I alluded to that a while ago. Technology assessment seems, from the point of view of the grassroots provider of medical care, to go in circles within academia and government, but it does not really filter down to the grassroots user. We desperately need to work with these people to develop clinical practice guidelines that will allow us to use our equipment far more efficiently and effectively. We cannot do that in isolation. We need to cooperate with everyone. It is multidisciplinary.

Have I covered all your questions?

Senator Morin: You certainly did.

Dr. Sanders: I wish to comment on the fundamental difference between the decision-making process and diffusion process for drugs compared to technologies. The publicly-funded drugs must be listed on the provincial formularies. That is the only way that the public pays for drugs. However, on the technology side, on the equipment and devices side, decision-making and purchasing is a far more diffuse process. Those decisions are made at all levels of the health care system and are far more difficult to influence in terms of health technology assessment or any other guidelines that someone might wish to implement.

Getting back to the point regarding the coordination or interface between health technology assessment and going beyond government, we are embarking on an outreach campaign, but it is limited by funding. We have our first three sessions set up in the Atlantic provinces for the spring.

It is difficult to reach a lot of people because you are asking them to take time out of busy schedules. You get into this issue again of taking physicians away from being able to provide service. We do not only want to tell them what we do; we want them to tell us how to do it. That interaction needs to be developed. We will try to develop that further, but we will need help to try to encourage those out there making those distributor decisions to engage with us. It is a tough one.

Mr. Zelder: You asked why patients are going to the U.S. when they have fewer radiation machines per capita. Part of it is qualitative. All kinds of different machines are included in this definition. I would imagine the U.S. machines are of higher quality and use newer, more advanced technology.

Part of the problem is also personnel shortages such as lack of radiotherapists to do the procedures. The point is that the U.S., with fewer machines, is still able to treat not only all of their own citizens but also Canadian citizens. It points at systemic failures here in using resources efficiently.

Senator Fairbairn: One thing that you have added to an extremely discouraging list that we are developing in this committee is on the side of human resources. We have heard about the shortage of nurses and physicians. Yesterday, it was the pharmaceutical industry. Today all of you, and certainly Dr. Radomsky, have focused on the area of radiologists.

What is the problem? Over the years we have prided ourselves on our educational institutions in the area of medicine. Is this primarily because of money that you can get in greater chunks in the United States? Is it a question of the technology? Do the difficulties in Canada prompt young people who are studying to want to go elsewhere, where the technology is better? What is it in your area of the health system that is drawing people away from this country? In your last human resources point you talk about creating a retention and repatriation program for Canadian radiologists. My question there is: What do we have to offer?

Dr. Radomsky: Thank you for asking those questions. Approximately 25 per cent of our graduates each year go to the United States for further training and/or to stay permanently. A proportion come back.

We were in a relative steady state up until the time the ministers of health across Canada put their heads together and decided the way to cut medicare expense was to cut the numbers of providers. Medical school enrolments were cut 10 per cent across the board. In Canada, it is now harder to get into medical school. There is approximately one position for every 20,000 Canadians, whereas in the rest of the developed world, in Britain, for example, it is about one in 12,000 to 14,000. A similar situation prevails in Australia. In the United States, it is one in about 9,000.

Senator Fairbairn: That is shocking.

Dr. Radomsky: First, we are denying some of our best and brightest children the opportunity to be educated in medicine in Canada.

We cut the positions back and now we are down, from approximately 100 graduates a year, to 70 graduates per year. This cannot be reversed for several years simply because it takes so long to produce them.

Senator Fairbairn: Yes; 10 years.

Dr. Radomsky: To compound that problem, Canada is becoming relatively non-competitive on a global scale. We have a 63- or 64-cent a dollar and a tax system that penalizes, relative to the United States, the higher income earners. It is very seductive for Canadians to go to the United States and stay there. That is a major problem. That is not my problem to address. My problem is to deal with my patients right now within the confines of the Canada Health Act, which is what I must live within. This is an issue that is more of a societal issue that we must address on a larger scale. How will we retain people when it is more lucrative -- not just economically but academically but, in many other ways -- and more seductive to live in a different economy?

The Chairman: In late April or the first week of May we will be studying the human resource question across the field.

Senator Cook: Senator Morin touched upon my concern, and that is the $1 billion funding that the government has offered to the provinces for capital equipment. It has been my experience in the health care field, as a board member in my own Province of Newfoundland, that capital funding was not the priority, other needs were greater. That is my thinking about why that money has not been accessed. The money that is being accessed -- at least in my province -- is to take care of existing equipment. I hear you saying that there is a need for the recruitment of more personnel to get to the point of using advanced technical equipment.

Having said that, how will we keep pace, as a nation, with the emerging new technology and what Dr. Jill Sanders is saying here regarding the policies, the research that you are putting in place, what you can offer? How do you see us keeping pace?

Dr. Radomsky: That is probably the most difficult question that I have faced today. It is at the crux of what we are dealing with.

We are at the point where we cannot provide the service to everyone at all times in all circumstances. Even if you gave us the equipment today, we would have to turn it down because, unless we have the people, we cannot operate that equipment. We can play with efficiencies within the system, but we are so far behind at this point that we must do something significant to increase the numbers, retain those that we have, and bring back some of the people who went to the United States and other countries to Canada.

I am an expatriate. I spent a good part of my early years in the United States. I came back. I personally think that this is the most ideal country in which to live. Half of my family, however, are practising medicine in the United States. We need to bring our people back and we must have a competitive environment to do that. A competitive environment is not simply financial, it includes all the other things that give us the satisfaction of doing our work with our patients. I do not know that I can answer that question any more honestly.

Senator Robertson: Hospital boards and administrators look at hard technology in a different light from others because it comes from offshore. With the value of our dollar today, money does not go as far when you have to import equipment.

The Chairman: With the lower dollar?

Senator Robertson: Yes. The budget is hurt terribly.

Mr. Feeny: I have a brief comment on the health professional manpower issue. As I recall, the recommendation when medical school enrolments were reduced was that there be an increase in allied health professional enrolment and graduation to change the mix of providers. Of course, we got half the solution. We cut the medical school but we did not increase the other number.

Now, some of Dr. Radomsky's solutions are also thwarted. One of the things he could do to increase his efficiency is to have the technologists do more. But you cannot find them either, can you?

To reduce the effect of the shortage of pharmacists, we could use more pharmacy technicians and robotics. Some of the robotics might work, but pharmacy technicians are also in short supply. Medical technologists are in short supply. We need more training, but we also need to change the ultimate mix of things, not just walk-step in the pattern that we used to have. Unfortunately, we have not trained the substitutes either. It is particularly grim because we do not have another safety valve.

Dr. Radomsky: There is a limited place for alternate providers in our extremely high-tech environment. We must make that judgment. We have to make the diagnosis. The diagnosis includes a tremendous amount of medical background. It is not simply looking at the picture. A host of other things must be taken into account, and that requires professional expertise.

The Chairman: On behalf of all of us, thank you for taking the time to come here this morning. I hope you found it as interesting as we did. It was a fascinating session.

Senators, we will now continue in camera for a few moments.

The committee continued in camera.