Finance Committee on Nov. 22nd, 2016

[Dr. Fabiano A.S. Taucer]

I'm not sure it's the key to the argument. First of all, the way you use salary is something we as physicians are constantly fighting. We bill for services we provide so we're not salaried employees. We have no benefits, no pension.

If you use $200,000 as gross income, it would be like the owner of the corner store getting $200,000 of gross income and then paying all the overhead, all the employees, all the benefits, etc. In that case, maybe a $100 difference is accurate, but it is not accurate to characterize that $200,000 as a salary. It is gross income to a small business, and that makes an enormous difference.

[The Chair, Liberal, Wayne Easter]

I'm going to have to cut you off. I expect we'll be in this discussion a few more times before we get to five o'clock.

Mr. Albas, you're next.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

Thank you, Mr. Chair.

Thank you to everyone for coming today and sharing their expertise on this particular piece of legislation. I'm going to be focusing my time particularly on the Ontario Association of Radiologists. I appreciate your being here.

Mr. Grewal has already talked about salary and whatnot. I'm concerned, Mr. Chair, when I go to many parts of rural British Columbia in my riding, often it's more difficult to attract physicians. Raising taxes on high-income earners as this government has done has made it more difficult to attract physicians, particularly when places like the United States are right across the border and not very far away.

I'm very alarmed that not only are we providing disincentives for people who are working solo, but now in a way that affects our provincial and territorial partners.

I was sent an email saying that many of these medical structures were formed to deliver provincial and territorial health priorities. You have mentioned a number of them, particularly teaching, research, clinical services. These changes will impact the service and cause many of these group partnerships, which have developed over 15 to 20 years. That jeopardizes not just what you called non- or badly remunerated services, but will compromise health care for patients.

Is that correct?

[Dr. Fabiano A.S. Taucer]

Yes. That's correct.

I would like to make a number of points, but I will try to make it brief and use an example.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

I would much rather have you get them all on the table.

[Dr. Fabiano A.S. Taucer]

That's fine. I'll use the example of institutions that do research and teaching. These large groups that work in those types of hospitals function as a group, and the group supports the individual who is involved in teaching and research.

Money is short everywhere, but there's not a lot of money for research in this country, and research is vitally important. The reason I kept getting back to patient care and all the items I talked about, is that at the end of the day it funnels down to patient care. If you have good research, you're going to get a better result in the end, and everybody appreciates that.

Those individuals are financially supported by the groups. The provincial government in Ontario has established something called an AFP, an alternative funding plan, specifically to encourage groups to form so they can support teaching and research, which they recognize is underfunded.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

You see right now the provinces are trying to structure services for everyone's benefit, but at the federal level we're discouraging it.

[Dr. Fabiano A.S. Taucer]

Certainly the proposal of this legislation would work counter to the provinces.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

We had officials come in the other day, and they did mention, as I think you raised earlier, where all this is coming from. It seemed as if it's about revenue, and they don't agree with the assessment that this structure.... They think in a way that's very similar to the Prime Minister's comments that he believed small business tax rates were a way for many small business owners to enrich themselves at the expense of everyone else. I'm not paraphrasing properly there, but I think that's the point.

I did receive this earlier. I heard from a gentleman who operates out of the University of Western Ontario in the London Health Sciences Centre. He said that, in his centre alone, it will jeopardize a practice model that has taken 15 to 20 years to develop, that this negative impact will be felt by all groups, and that, in the end, patient care will suffer.

Would you agree with all those points?

[Dr. Fabiano A.S. Taucer]

I absolutely agree. I trained in London, Ontario. It's a great centre. University Hospital is a wonderful hospital, and I benefited from the teaching.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

Why are we only hearing from Ontario doctors? By the way, I love the fact that you're here to present, but is the fulcrum of this practice really in Ontario?

[Dr. Fabiano A.S. Taucer]

No, it's Canada-wide. I'm shocked as well. I would have hoped to have a barrage of physicians, but the reality is that everybody is really busy providing patient care. There aren't enough doctors. There aren't enough specialists. The reason why I'm here—I'm the alternate—is that the president of the OAR, Mark Prieditis, who was supposed to be here, is on call and he couldn't find someone to replace him. He's looking after patients as a priority. I happened not to be on call today, but I'm going to be doing my day's work tonight and tomorrow night.

[Ray Foley]

I think the other thing to appreciate is that when we talk about groups, certainly in radiology, groups on average range from 10 radiologists to 100. Obviously, the 100 are in large urban tertiary centres, but these are major collections of individuals with a very broad range of skills, and it works accordingly down to the smaller.

To the earlier part of your question, and this is something we did not mention, the impact of this will be on small town Canada, rural Canada, under-serviced Canada, but it will also be in urban and suburban areas, as people decide that this model, which has been cultivated by the provincial governments across the country, by hospitals across the country, to work in teams, to create this coalition, to create greater critical masses of skills....

Radiologists, for example, work with emergency physicians, and everyone who walks into emergency is typically running through the hands of a radiologist. Oncologists for the treatment of cancer, stroke, you name it, surgeons, internal medicine physicians, are all acting in teams in combination. This puzzle that has been crafted over really 30 years is now being accidentally...and I don't think anyone's doing it deliberately. That's the name of our talk, “Unintended Consequences”.

To give you an example of another unintended consequence, of why we're, in a sense, the canary in the mine, these things happened before for tax reasons or for financial reasons, and led to long waiting lists, whether it was CT or MRI, where there were cancer wait lists, or hips and knees. It is not the intention, but this will have the effect of creating those kinds of things down the road. It will happen first in the hinterland of the country, and it will work to the centre. Again, it's through no fault of the federal government or the finance department, but there is a lot of turbulence going on in the country.

You're asking why are radiologists...? We're a very large group. We watched this. We became aware of it. People were asking questions. We're representing radiologists and other physician groups from across the country who are asking the same thing. The CMA will be here this afternoon talking about this.

[The Chair, Liberal, Wayne Easter]

We'll have to cut it there, Ray. We're well over. I've let it go over a few times on this discussion because I think it's an important discussion.

Ms. O'Connell.

[Jennifer O'Connell, Liberal, Pickering—Uxbridge, ON]

Thank you, Mr. Chair.

I apologize to the other witnesses, but I'm going to jump in on this conversation, too, because I do have some questions. I can barely see you, but that's okay.

I have a few concerns in regard to when we're talking about...and I understand your response, but from the financial officials we are talking about tax policy. The concern I have is in regard to this idea of care as a result of tax policy. Physicians and doctors—and I know many—do a lot, go above and beyond, and they took an oath that is above and beyond just financial conversations. You brought up one point specifically about certain doctors, certain specialists, who are not actually compensated very well for some of the work they do. But should tax policy really be a substitute for compensation?

Shouldn't those performing duties be compensated in a way that is fair, and each province deals with that? Why should tax policy become the substitute for fair compensation?

[Dr. Fabiano A.S. Taucer]

My understanding of tax policy is that taxes are not just intended to get money for the government. There's a second part to tax policy, and that is to influence the behaviour of people. We do that all the time. We use tax policy to encourage people to go to remote areas, or we use tax policy to discourage people from polluting. I think that perhaps the purpose of taxes is much broader than that.

I agree with you; I think services should be fairly remunerated. The reality is that they are not. In the real world, we have to deal with that, and the proposed legislation would have a negative impact on care, whether we like it or not.

[Jennifer O'Connell, Liberal, Pickering—Uxbridge, ON]

Thank you.

Although I'm trying to stay focused on the tax policy, which is what we're actually dealing with, I can't, because we're talking about a lot of other things. Mr. Albas raised the point that somebody sent to him that this has been a model for 15 or 20 years, which we're moving away from. I think there's some argument about whether we're moving to a better model or whether that has been a better model. Twenty years ago, if you went to your doctor, in a lot of cases there was a continuity of care. Going into group models, sometimes you can go in to see your doctor and you never see the same doctor, even though that's your family doctor.

In the past, the model used to be that if a physician went on vacation or was off sick themselves, they had family health groups or family health teams that would come in and substitute. People had this continuous care by doctors who knew who they were, doctors who understood their medical history, instead of having somebody new every single time.

We're not here to debate whether one model is better than the other, because, frankly, that's outside the purview of this, but it's been brought up that this will create a system of sole practitioners because there's a benefit. I'm trying to understand...and perhaps sole practitioners might not be such a bad thing in terms of care.

[Ray Foley]

Last year—and for many years—the tax ruling or the interpretation by CRA was that this was a permissible model. Physicians across the country have received these tax rulings and they have formed groups, not just of radiologists but of surgeons, of family physicians, of the alternative funding teams in London, and other academic centres.

What you're doing is sort of unwinding here, we think unintentionally, all of that integration of care. In health policy, everything is about integrating care and closing the gaps. We're not talking about the quality of care from an individual physician. Particularly in large practices, certainly in specialty medicine, everything in the science and the evidence is about practising in groups, not solo. That was the old model. There are actual quality concerns about physicians practising alone or with one or two individuals.

[Jennifer O'Connell, Liberal, Pickering—Uxbridge, ON]

But my understanding is that if someone was in a group model but now goes into a small business as an individual, that doesn't prevent them from that integration of care. Again, we're getting away from the idea of group care. This is a business structure, not a care structure in terms of your partnerships with other facilities or your partnerships with other doctors and things like this. It would be a tax structure with regard to how the individual sets up their business.

If this is wrong, tell me; educate me. What I'm saying is that it's not that if somebody goes into a business structure then they no longer work with anybody else.

[Dr. Fabiano A.S. Taucer]

What you're suggesting is correct if you have all physicians providing exactly the same service. For instance, if each family doctor provided the same service and billed the same amount and worked the same hours, it would work fine. The reality is that medicine has evolved tremendously since the days of Marcus Welby, so that's no longer the case.

Medicine requires subspecialization. You can no longer have that one doctor who knows everything, or even a group of doctors. Radiology is a fairly specialized field. Even in radiology, in my group, we have subspecialists in neuroradiology and subspecialists in musculoskeletal or abdominal imaging.

Because the fee schedule is what it is, if they were individuals, they would all bill different amounts.

[Jennifer O'Connell, Liberal, Pickering—Uxbridge, ON]

Aren't those subspecialists—

[The Chair, Liberal, Wayne Easter]

Sorry, Jen, you're well over time.

Mr. Liepert.

[Ron Liepert, Conservative, Calgary Signal Hill, AB]

Thank you, Mr. Chair.

I'm going to quickly make a couple of comments to Mr. Foley and Mr. Taucer.

In a previous life I was a health minister in Alberta, and if there's one thing that drove me crazy, it was the fact that the medical profession didn't work as groups. I think the advancement that you've made in the last decade or so has been phenomenal in terms of providing that kind of care to the patient. We could get into a pretty good debate with my friends across the way here about these things.

Mr. Foley, you said a couple of times that these are accidental, unintended consequences. We had finance officials here last week, and I don't think it was accidental. In fact, in listening to some of the questions that are coming from the government side, I'm convinced it's not accidental. I'm convinced that this is the beginning of how this government is going to move into small business taxation. We have a budget, but first we had an election where the Prime Minister not only said that they were going to increase taxes a little bit higher on the high-income earners; he also said that small businesses in many cases were nothing more than a tax dodge.

Now in this budget, where we did not have, as promised in the election campaign, a reduction in the small business tax, we are now seeing a tax coming on for small businesses. For Mr. Grewal, who unfortunately isn't here, we're going to see with the Canadian Medical Association and their presentation in the next group that, as an example, in the province of Nova Scotia the tax rate goes from 13.5% to 31%. That's hardly hundreds of dollars.

I think, with all due respect, gentlemen, if this gets changed, it's going to be because of the work of people on this side of the table, and because of people like you. It is not an accident, and if it doesn't get changed that will prove me correct. I see Mr. Champagne sitting right next to you who can take that back to the finance minister.

Those are my comments regarding that. I'm not sure if you want to make any other comments, but I would suggest that this is this year, and next year it's going to be groups of general practitioners or other medical professionals. I think this is a trend that's going to happen.

[Ray Foley]

We may be guilty of being naive or being too nice. Tax law is not what physicians do.

[Ron Liepert, Conservative, Calgary Signal Hill, AB]

That's right.