A suit by senior citizens of Ontario, Canada, seeking to force the provincial government to restore higher coverage for hospital stays outside the country is being watched closely by Florida hospitals.
The suit was filed by "snowbirds," the estimated 600,000 affluent Canadians who annually flee to warmer climes, many of them staying in Florida for as long as eight months.
The snowbirds' national health coverage has been a boon to American hospitals, which could feel a pinch if they have to provide care to the minority of Canadian travelers who won't purchase supplemental insurance policies.
Effective July 1, the Ontario Hospital Insurance Plan slashed daily coverage for emergency inpatient and outpatient services to $100 and $50, respectively, from $400 for either.
Dialysis treatment was reduced to $210 from $293. (Editor's note: The dollar figures in this story are Canadian. One Canadian dollar is equivalent to approximately 65 U.S. cents.) The coverage lasts up to eight months.
Citing Canadian law requiring equal care for residents out of the country, two seniors sued on behalf of the Toronto-based Canadian Snowbird Association and its 150,000 members.
The CSA also wanted to sue the Alberta and Saskatchewan provincial governments (with the same $100 daily maximum) and British Columbia, which allows $75 per day. Instead it focused on Ontario, which has the largest population and the most snowbirds, said CSA executive Don Slinger. CSA members backed the effort with contributions of $200,000. Though supporters consider it unlikely the court will simply overturn the limit, any decision in the snowbirds' favor could pressure the provincial government to change course.
Cost control.The national average cost of hospitalization in Canada is about $553 a day, which Mr. Slinger said is "totally inconsistent. The government was overpaying, up to $1,000 a day before it was dropped to $400, but now it has gone too far the other way."
But provincial Health Minister Ruth Grier countered, "Out-of-country costs must be controlled so that we can maintain the excellence of our own health services. The $20 million in savings will be invested in improving healthcare services that people receive in Ontario."
Those costs peaked at $309.8 million during fiscal year 1992, bloated by Ontarians staying at expensive U.S. clinics that treat alcohol and drug addiction. When coverage dropped to $400 a day, costs plunged to $106.4 million in fiscal 1993, down to $70.9 million during fiscal 1994 and should be sliced to $50 million this fiscal year. The fiscal years end March 31.
During fiscal 1994, some 50,000 Ontarians were treated outside Canada, 31,257 of them for emergencies, at a cost of $31.7 million. The government will continue to pay 100% of the cost of treating residents with serious medical problems on an emergency basis in U.S. hospitals when care isn't readily available in Ontario. They will pay for U.S. care also available in Ontario based on a physician's written recommendation.
If the suit fails, Mr. Slinger said, the CSA will go before the Federal Court of Canada, to try to force the Canadian government to punish Ontario by cutting transfer payments to the province.
Wallace Weylie, the CSA general counsel, who lives near Tampa, Fla., and is licensed to practice law in Florida and Ontario, said: "Hospitals in the United States don't have a problem with OHIP coverage and generally recognize supplemental insurance from private carriers. It's really the extras that OHIP doesn't cover that concern the hospitals."
Mr. Weylie said the average daily cost of a U.S. hospital stay is $1,400. "A hundred dollars Canadian is about $65 U.S., which won't even get you in the door. The government could have just as easily made it zero dollars," he said.
"The idea of all the Canadian private insurance plans is evacuation," he said. "Get the patient stabilized down there and fly them back to Canada by air ambulance. It costs about $6,000 (in U.S. currency) from Florida to Toronto, but that's nothing compared to the cost of keeping someone down there." Once those patients are back in Canada they're off the private insurance plan, he said.
Mr. Weylie estimated that 90% of Canadians in the U.S. have supplemental coverage from private carriers.
The CSA offers such insurance to its members. The premium for 182 days out of the country is $686 for those aged 65 to 69, and $960 for ages 70 to 74.
Snowbirds have been actively sought as patients by Florida hospitals, which claim "they are able to look after their medical problems" and are familiar with Canadian insurance coverage, said David Smith, managing editor of the Tampa-based Sun-Times of Canada.
He said healthy snowbirds are among the small percentage inclined to pass on supplemental insurance. They may figure it would be cheaper to go home on their own or to buy airline insurance to travel on a medically supervised flight.
Lorena Zeledon, assistant director of the international center at 585-bed Cedars Medical Center, Miami, said not enough Canadians who lack private insurance show up for treatment to strain Cedars' resources.
Mr. Warson is a Toronto-based free-lance business writer.