1 Economic Cost of Wait Times in Canada: Preliminary Assumptions and Findings ©2006 The Centre for Spatial Economics Robin Somerville Director, Corporate Research Services The Centre for Spatial Economics CSLS-CMA Invitational Roundtable on Health Care and the Economy Ottawa, ON March 7, 2006 Draft – not for quotation

2 BCMA/CMA Study Overview ©2006 The Centre for Spatial Economics Rationale  Wait times will always exist in a universal access health care system. The length of the wait time is dependent on multiple factors but waits in excess of recommended maximums impose costs on patients, the health system and the Canadian economy. Phase I  Estimate the number of patients who are waiting for longer than the recommended maximum period for treatment and the average length of their wait  Preliminary analysis for this phase is complete Phase II  Estimate the economic costs associated with waiting in excess of the recommended maximum period for treatment  Data collection, assumptions and analysis for this phase is underway

3 Wait Times Research ©2006 The Centre for Spatial Economics Why Wait?  With universal access, wait times represent the substitution of “non-price” rationing for the price rationing that occurs in other competitive markets Cost of Waiting: Other Research  Cullis and Jones (1986), $5,600 per patient in the UK in 1981  Propper (1990), $1,100 per patient in the UK in 1987  Globerman (1991), $2,900 per patient in Canada in 1989  Esmail (2005), $900-$2,700 per patient in Canada in 2004

4 Wait Times in Canada ©2006 The Centre for Spatial Economics Fraser Institute  Wait times in Canada are falling - slowly Conference Board of Canada  Wait times in BC, Alberta, Saskatchewan and Ontario are better or near the average for OECD countries with comparable health systems Public Perception & Policy  Public opinion in Canada favours improved access and shorter wait times  Public policy is attempting to address the issue

5 Conference Board of Canada: Wait Time Benchmarking ©2006 The Centre for Spatial Economics Gold – represents performance in the top third of OECD countries and provinces

6 How Long is too Long? ©2006 The Centre for Spatial Economics  While wait times must exist, the length of wait is a matter of public policy  Prior studies have examined the overall cost of waiting using various methodologies  This study is the first not just the total wait time cost but also the incremental cost of waiting longer than the maximum time recommended by physicians and public health officials  The economic costs will be driven by the:  Impact from reduced productivity of waiting longer for treatment and caring for patients  Additional health costs associated with longer wait times

7 Wait Times from the Patient’s Perspective ©2006 The Centre for Spatial Economics

8 Current Wait Times for Treatment ©2006 The Centre for Spatial Economics CABG urgent & elective wait times from the Fraser Institute CABG provincial wait time data in BC and SK inconsistent with Fraser Institute survey data

9 Maximum Recommended Wait Time ©2006 The Centre for Spatial Economics Fraser Institute: “reasonable” wait time average of 4 provinces

10 Maximum Wait Times ©2006 The Centre for Spatial Economics Wide range of opinion in what constitutes the maximum or reasonable wait time for treatment Study will use Wait Time Alliance recommended maximum wait times CABG maximum wait time developed by assuming elective procedures account for 68% of all cases

11 Excess Wait Time ©2006 The Centre for Spatial Economics Current data show that treatment wait times vary considerably by province and procedure

12 Excess Wait Time Methodology ©2006 The Centre for Spatial Economics Observation  If the median wait time equals the maximum recommended wait time, 50% of patients have to wait longer than recommended Data Requirement  The distribution of patient wait times by procedure and province Approach  Proportion of patients with excessive wait times multiplied by their average wait (less the recommended maximum wait) yields the average time a patient can expect to wait for treatment beyond the recommended maximum period  The total wait time (or queue) can be estimated by multiplying the previous number by the incidence of the condition and the province’s population

13 Patient Wait Times ©2006 The Centre for Spatial Economics The bolded figure highlights the median patient wait time The red shading indicates the Wait Time Alliance maximum recommended wait time

14 Proportion of Patients with Excessive Wait Times ©2006 The Centre for Spatial Economics There are always some patients that wait longer than recommended

15 Average wait for Patients Not Treated Within Recommended Maximum Period ©2006 The Centre for Spatial Economics This estimate is based on the proportion of patients treated after the recommended maximum wait time multiplied by the average length of their wait

16 Expected Wait Beyond Recommended Maximum Wait Time ©2006 The Centre for Spatial Economics This table shows the average wait time beyond the recommended maximum that a patient can expect after being scheduled for treatment

17 Incidence Rates per 100,000 People ©2006 The Centre for Spatial Economics Incidence rates are used to estimate the size of the queue in each province in terms of the number of people waiting beyond the recommended maximum period for treatment Need to look for crude instead of standardized rates Cataract surgery rates are just for acute/inpatient

18 The Queue ©2006 The Centre for Spatial Economics Size  The overall size of the queue (measured in patients per year waiting in excess of the recommended maximum time) is determined by the number of cases in each province times the probability of waiting beyond the recommended wait time Patient Characteristics  Patient characteristics are used to help determine the economic cost associated with the queue  Incidence of the condition by: oProvince oAge oSex oSocio-economic status (i.e. income) oSeverity (urgent, elective)

19 Total Provincial Wait Time in Excess of the Recommended Maximum (# Years) ©2006 The Centre for Spatial Economics This table shows the number of patients each year waiting for longer than the recommended maximum time for treatment This information will be used to generate the incremental economic cost of wait times in excess of the recommended maximum time

20 Economic Cost of the Queue ©2006 The Centre for Spatial Economics The economic cost of the queue developed in the first phase will depend on the following assumptions:  Impact (if any) on mortality rates  Impact on health expenditures (pre- and post-op)  Impact on drug costs to manage the condition prior to the procedure  Impact on personal incomes from reduced hours worked  Impact on public sector income support spending  Impact on productivity – patient and care-giver

21 ©2006 The Centre for Spatial Economics for more information please contact: Robin Somerville Director, Corporate Research Services The Centre for Spatial Economics 15 Martin Street, Suite 203 Milton, ON Canada L9T 2R1 phone: web: