Canadian health care will wallow in mediocrity and consume wealth until governments allow private insurers and require patients to pay more cost directly out of pocket to providers, a health economist warns.

Writing for the Macdonald-Laurier Institute, a public policy think tank, the University of Torontos Audrey Laporte steps on a third rail for Canadian politicians who talk of health care as a national icon.

She said she did so with trepidation, concerned shed be dismissed as a radical, her message unheeded.

Were probably not going to get radical change until we run out of money, she said.

In her just-published report, Laporte said health policy-makers ignore economics at their peril.

If they took basic economic theory the least bit seriously, the medical system could be much more efficient, and vitally, much more attuned to the needs of that often neglected and forgotten stakeholder the patient.

For too long, Canadians have been smug about their health care simply because it was more sensible than whats found in the U.S., she argues. Laporte describes American health care as a Rube Goldberg device, in which a series of quick fixes causes more and more chaos and problems.

She argues Canada should look to Europe and Australia, and at home, at dentistry, to see how market forces benefit patients. It begins with having patients pay for a share of their care.

You have to have some skin in the game, Laporte said.

Governments should set minimum standards but allow the private sector to set prices and services. They are the individuals with the greatest incentive for getting it right, Laporte said.

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Market forces can benefit patients, health economist warns