The Private Cost of Public Queues

June 28, 2012

In December 2011, the Fraser Institute released its 21st annual measurement of waiting times for medically necessary treatments in Canada. This most recent measurement shows that the national median waiting time from specialist appointment to treatment increased from 9.3 weeks in 2010 to 9.5 weeks in 2011.

Nadeem Esmail of the Fraser Institute has since provided an informed measure of the economic disruption caused by this lost time. Pulling on data from the health sector and national wage data, he concludes that aggregate losses are valued in the billions of dollars.

  • In 2011, an estimated 941,321 Canadians were waiting for care after an appointment with a specialist.
  • Multiplied by the average 9.5 weeks spent waiting, this amounts to 11.8 million weeks spent waiting, which is substantially more than the 10.2 million weeks for 2010.
  • Of course, not all time spent waiting is entirely wasted -- modern technologies have allowed many, even those suffering previously debilitating diseases, to continue to operate normally while awaiting a procedure.
  • Thus, Esmail relies upon a 2005 finding by Statistics Canada that 11 percent of those awaiting non-emergency surgery were adversely affected.
  • This means that of the 11.8 million weeks spent waiting, 1.3 million can be considered economically lost.
  • Applying this figure to wage data for median earnings during standard work weeks, Esmail calculates that the economic cost in terms of forgone wages amounts to C$1.08 billion, or C$1,144 for each individual awaiting a procedure.
  • Alternatively, assigning this cost only to the 11 percent who were adversely affected, the expense increases to C$10,399.

Importantly, this calculation leaves out a number of factors that may increase the aggregate cost of the time spent waiting within Canada's health system.

  • It does not include time lost on the weekends due to adverse effects, essentially assigning no value to time lost if it would not otherwise have been paid time.
  • It does not include time lost by relatives of those who are waiting for procedures, many of whom are unable to work normally because they are providing care.
  • Finally, this calculation does not incorporate data for inherent risks of waiting, such as the risk of unnecessary mortality.

Source: Nadeem Esmail, "The Private Cost of Public Queues," Fraser Institute, June 2012.

For text:

http://www.fraserinstitute.org/uploadedFiles/fraser-ca/Content/research-news/research/publications/private-cost-of-public-queues-2012.pdf

 

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