Lochner in Canada?

by Henry on June 11, 2005

Robert Lemieux has an interesting analysis of the decision of the Canadian Supreme Court to strike down a Quebec law forbidding the sale or purchase of private health insurance. I’m not sure if the Lochner analogy isn’t a little strong, but this does seem to be a worrying precedent, whatever the substantive merits of the decision.



Billings 06.11.05 at 6:56 pm

So it’s not OK now for people to die waiting in line for treatment. Even Canadians must applaud this.


andrew 06.11.05 at 9:17 pm

Yes, even we schadenfreude-filled Canucks are happy it’s now wrong for our fellow countrypersons to die waiting for medical care. What were we doing before? Cheering them on at the hospice?

And it’s not much really – Quebeckers can maybe go and buy insurance over and above what they pay in taxes so they can wait in the magical private care line, where thousands of bored doctors will be chomping at the bit to serve them. With the way the right is talking about this decision, I guess now we’ll finally be able to knock Japan off for first in line in the life-expectancy race.


Dwight Cramer 06.11.05 at 10:13 pm

Hard to say if it’s a Lochner-class decision. It takes a strong public and political reaction, and not just a fatal analytical flaw, to take a decision to that level. Roe v. Wade may be the better analogy (but a bit harder for the Americans to stomach). I hope this outcome is better received in Canada than that has been in the States, and that the norms of a civil society will permit a more politic resolution than they’ve achieved down there.


Scott Lemieux 06.12.05 at 2:34 am

1)I should emphasize that when I analogize to Lochner I don’t mean that the Canadian courts are going to start striking down maximum hours laws, or anything. I simply mean to suggest that reading that kind of liberty of contract into clauses guaranteeing due process is a very dangerous precedent.

2)It’s Scott. :)


John Quiggin 06.12.05 at 3:35 am

As Scott says, if the decision isn’t Lochner it’s something that constitutionally more dubious, though politically more ambiguous: the creation of a court-enforceable right to healthcare.

Let’s suppose some government decides to ration or means-test a procedure that was previously freely available under the public system. On the majority reasoning here, that’ looks like a violation of the right to ” life, and to personal security, inviolability and freedom.” [unless you have some sort of Lochner-style argument that encompasses free markets, but not free health care].

As Scott says, you can push it further and infer a positive obligation on governments to meet all demands for health services that a court deems reasonable.


Henry 06.12.05 at 8:32 am

billings – the post quite clearly states that we’re not talking about the substantive merits of the decision. I’ve seen three comments from you over the last two days – all three seem to deliberately misread posts in a way that’s designed to inflame discussion. You’re on warning that unless you change your act, you’re going to be treated as a troll.


Brett Bellmore 06.12.05 at 8:59 am

Yes, god forbid people who can pay for something should be allowed to buy it. Troubling indeed…

I’m being sarcastic, of course. What’s so god-awful about liberty of contract? Unless, of course, you’re a coercive egalitarian, who thinks people who can afford medical treatment the government doesn’t feel like offering should DIE in the cause of equality.

Human sacrifice to the god of equality, that’s what we’re talking here. Good for the Canadian courts, rejecting that bloody civil religion!


mark s 06.12.05 at 9:06 am

god forbid that the wealthy should be denied the right to queue-jump and hog limited resources


Kevin Donoghue 06.12.05 at 9:54 am

It’s Scott. :) Of course it is. If you want to catch the Chairman’s attention, call him Kieran.


Colin Farrelly 06.12.05 at 11:16 am

One egalitarian response (though not a response I would defend- but its useful to consider anyways) to Brett Bellmore’s comment above is the following:

“I don’t think people should die in the name of equality either. But one major reason why the publicly funded healthcare system is in trouble can be traced back to constraints imposed by wealthy Canadians themselves! Namely, they refuse to support higher levels of taxation and this undermines the effort to re-invest in the public system so that we could reduce the waiting times for all Canadians”.

Now IF all our healthcare problems could be remedied by throwing in more public funds then I think the egalitarian would be able to make this kind of response compelling. But of course the constraints on healthcare are much more complex than this. Healthcare is a tough case because it is a bottomless pit. We could spend an endless amount of public funds trying to increase the lifespan of an expanded aged population. So the problem is not just money, but also the fact that we are all vulnerable to the detrimental consequences of aging, disease, etc. and other factors like the migration of knowledge workers, the lifestyle of North Americans, etc.

What I find surprising is that Canadians are popularly perceived of as very egalitarian people. But I should point out that we don’t have an inheritance tax in Canada and there is immense pressure (from both the middle classes and the wealthiest) on the government to reduce tax burdens more generally rather than raise them to help mitigate disadvantage. Given this scenario, it is not surprising that an egalitarian provision of healthcare is under assault! But it is not the Supreme Court who threatens this. It is Canadians themselves who threaten it when we expect every politician to promise (at a minimum) not to raise taxes though preferably to cut taxes. It is so much easier for Canadians to blame “judicial activism” then it is for them to look in the mirror and see our own collective failings.


stormy 06.12.05 at 11:34 am

Being a landed immigrant in Canada, I have a somewhat mixed reaction to the decision. Yes, it does preserve the right of private contract, but private contracts even freely entered can violate the law. Indentured servitude, for example, can be freely entered; but it clearly violates what we know to be just.

To argue that the law deprives one person quick and speedy health care is to forget that allowing a two-tiered system favors wealth, especially when resources are sometimes limited. From that point of view alone, striking down the law in the name of the Charter and individual rights seems, at best, somewhat confused. What of the rights of someone equally needy who must now wait in a still longer line?

To speak to Americans who like to sing the virtues of the American system at the expense of some of the difficulties Canadians might sometimes experience: I personally find the Canadian system to be far superior in response time, in quality of care, and in ability to choose. Pressing cases are handled with immediate dispatch. Ones that are elective or are not pressing may have to wait a bit. But I waited in the states as well—and I was allowed a very limited choice in terms of doctors for any surgery I needed. Tests and procedures are firmly in the hands of the physician—not some insurance bureaucrat.

In short, I prefer the Canadian system.


David 06.12.05 at 3:15 pm

The trouble with letting people buy healthcare is that those who can afford to pay will not support taxation to help those who cannot. Soon the system will collapse into plain capitalism.


MollyMooly 06.12.05 at 9:57 pm

When rich people spend their money on ivory backscratchers and lark’s tongue roulade, nonrich people dercry their decadence; when they spend it on private healthcare and education, nonrich people fret over two-tier systems. I think we need a list of things rich people can legitimately spend their surplus discretionary income on without incurring the wrath of the others. Fuel-cell cars, maybe? Organic vegetables?


Tom Hurka 06.12.05 at 10:47 pm

The Canadian Supreme Court decision needs to be read in context: it closely follows, as the majority repeatedly says, the 1988 Morgentaler decision that struck down the then-existing therapeutic abortion law. People who object to the current decision should likewise object to the Morgentaler decision, but that has mostly been hailed as a victory for abortion rights.

The old abortion law required abortions to be performed in hospitals and only when a hospital commitee determined that the abortion was necessary to preserve the woman’s physical or mental health. In big cities the law was interpreted liberally, with hospitals holding that if a woman wanted an abortion, that showed that not getting one would be bad for her mental health. But in some provinces abortions were not performed at all, and in others women in remote regions had to travel long distances to get an abortion. Henry Morgentaler, who wanted to operate private clinics that provided abortion on demand, and who has just been given an honorary degree by the University of Western Ontario, challenged the law up to the Supreme Court of Canada.

The Court upheld his challenge, holding that the delays imposed on women in less well-served parts of the country were unreasonable and violated their right to security of the person. The Court did not demand that private clinics be legalized; it allowed that Parliament could maintain something like the old system if it rewrote the rules to remove the delays. But abortion politics in the House of Commons prevented that, no new law was passed, and now private abortion clinics operate. As I say, most on the left think that’s a good thing.

The current decision is very similar, holding again that the combination of unreasonable delays in a public system with a ban on private purchase of medical services violates citizens’ rights to security of the person. The decision doesn’t force Quebec or other provinces to allow private health insurance for medicare-covered services (though three or four already do). It just says Quebec can’t forbid such insurance if its public system isn’t providing medical services in a reasonably timely way. The decision explicitly denies that there’s a blanket right to healthcare, and likewise denies that all delays count as unreasonable. (The dissenting minority say the Court shouldn’t be deciding what type of delay is and isn’t reasonable, but then what was the Court doing in Morgentaler?) It’s too soon to say what effects the decision will have, but one possibility is that the provinces will tighten up their systems so they no longer have unreasonable delays. And some well-informed Canadian health-care experts expect that to happen to a sufficient degree that the systemic implications of the decision aren’t enormous.

(Another point: private medical care already existed in Quebec, and was available to the very rich who could pay for medical services as they needed them, e.g., $10-18K for a hip replacement. The effect of the ban on private insurance was just to keep the middle class from accessing these services, since they couldn’t afford to pay that way. But the very rich were already looked after.)

The main point, however, is that the reasoning in the current decision closely follows the reasoning in Morgentaler and is therefore, in the legal context, not surprising. In fact, I don’t see how the Court could have reached a different decision in this case given their earlier decision in Morgentaler. (Well, they could have done it in various ways, e.g. by denying that the delays in Quebec were unreasonable. I mean I don’t see how they could have reached a different decision on the fundamental principles.) So people who are terribly worried about the current decision should have been terribly worried by Morgentaler in 1988.

(I have to say it’s amusing (or something like that) to read posts on the decision by people who don’t know much about the Canadian health-care system or Canadian Charter jurisprudence.)


James Kroeger 06.13.05 at 7:00 am

How societies deal with scarcity is always a choice. If we rely on the pricing of markets to distribute scarce health services & technologies, then we are deciding to rationing according to wealth. Many people find that approach to be morally abhorrent.

After all, who should get a desperately needed kidney–a fifteen-year-old poor child who has a lot of promise, or an eighty-nine-year-old patient suffering from other serious conditions who happens to have a lot of money?

The problem of scarcity in the Canadian health care system is, as Colin Farrelly noted above, a matter of underfunding. The way to eliminate the long waiting lists is to hire more doctors, build more operating rooms, and purchase more equipment.

Look at the UK’s National Health Service. The only problem with the NHS is that it has been chronically underfunded due to the pressure of conservative politicians, et al. Still, by most measures of “health”, the citizens of the UK are either healthier than Americans, or nearly as healthy (OECD).

In spite of roughly equal “health outcomes” America’s private health care system costs Americans more than twice as much as the NHS costs the citizens of the UK. In 2002, UK citizens spent only about 8% of their GDP on health care ($2,160 per citizen). This compares to the approximately 15% of GDP that Americans spent on health care that year ($5,267 per citizen). This empirical evidence tell us that Socialized Medicine in England is far, far more EFFICIENT than America’s private sector alternative.

It doesn’t take a genius to see that if the British were to double the amount of money that they spend on health care, they would be able to dramatically increase the quality of the health care that the British people receive by increasing the supply of health services.

For a bit more perspective on the topic of underfunding government programs: Government Waste vs. Private Sector Efficiency


richard macbean 06.13.05 at 7:29 am

The Canadian Supreme Court decision was, I believe, a 4-3 vote. Very close, with two new appointees to the Court yet to take their seats. Challenges in other provinces may not therefore have the same result.

Also, as pointed out by others, the decision appears to have been hinged to the idea that private insurance was ok, only so long as the waiting times for procedures were “unreasonable”. That is basically a warning shot across the bow, as far as the single-payer provider is concerned. Canadians do not support single-payer systems for ideological reasons; they support single-payer because, over time, it has met their needs. The Court is reflecting the views of Canadians: if it needs fixing, then fix it or get out of the way.


Slocum 06.13.05 at 9:57 am

The trouble with letting people buy healthcare is that those who can afford to pay will not support taxation to help those who cannot. Soon the system will collapse into plain capitalism.

But that is demonstrably false. Consider the U.S. public K-12 education system. Rich people have always been able to opt out of the system and yet K-12 education in the U.S. shows no signs of ‘collapsing into plain capitalism’. No law forbidding families from buying education on the open market has been necessary for society at large to keep supporting public expenditures for K-12 education.

Similarly, wealthy Canadians, have been long able to opt out of the system by crossing the border (and most live quite close to the border). This has clearly not destroyed government-funded healthcare in Canada.

Why do public systems survive when there are private alternatives? Partly because there are a lot more low and middle-income families than rich families and partly because of path dependency. Most Americans favor of K-12 education funding because their own kids attend public schools. If they moved their kids to private schools, their incentives would change, and their opinions might too. But that is a big if. In order to make that move, they have to come up with both the tax money to pay for the public schools AND private school tuition. Only a relative few are willing or able to do this, so only a relative few make the transition from those who depend on public schools to those who oppose public funding.

(And note that vouchers programs don’t constitute a ‘collapse into capitalism’ either, but rather a change from a British-style government owned and run system to a Canadian style single-payer system).


Martin L. 06.13.05 at 2:51 pm

Slocum is right. The wealthy in Canada have always been able to purchase healthcare services. All they have to do is go to the USA and pay for it themselves. Public and private healthcare can and do operate just fine together. It is not an either/or dichotomous choice. Allowing private healthcare creates more resources, it doesn’t hog limited resources.


Eric H 06.14.05 at 1:01 am

“Soon the system will collapse into plain capitalism.”

Why so optimistic? It still hasn’t done so in the US (but we can always hope).


Scott Lemieux 06.14.05 at 11:12 am

Tom–the idea that Morgentaler *requires* this decision is just ludicrous. The obvious difference is that the abortion laws struck down in Morgentaler were 1)vague, and 2)aribtrarily enfocred. Essenitally, TACs could plausibly grant or deny any abortion. Moreover, the gross differences in application were not random, but obviously priveleged wealthy women and women who live in urban areas, which raises further problems of due process.

None of this applies to the current case, despite the vain attempts of the court to stretch a popular precedent to cover this one. The Quebec law is clear, and is not arbitrarily enforced in any respect. There are no geographic or class ineuities in its application. The court *claims* that there’s no substantive right to health care, but the decision simply makes no sense otherwise. Mogentaler was a “procedural” due process decision; the court’s attempt to claim that Chaoulli is are utterly implausible. And, certainly, the argument that Morgentaler is so similar to Chaoulli that it compelled the result is foolish. The cases are, in fact, easily distinguishable.

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