Private Health Care Option In Disability Management

Sylvie Gelinas
B.SC. Industrial Relations, University of Montreal, 1989

Project Submitted In Partial Fulfillment Of
The Requirements For The Degree Of
Master Of Arts
in
Disability Management

The University of Northern British Columbia
January 2008
© Sylvie Gelinas, 2008

U IVERSITY OF r ORTHER
BRi~r::-~ C·~ LI.;M~IA

li8RRF1Y
Prince G... org · , BC

2

The Debate
Timely access to healthcare has become a leading concern for many
Canadians. Wait times for diagnostic procedures, medical specialists and surgical
intervention have emerged as key points of debate for politicians, healthcare
professionals and academics. At the centre of the debate lies the more volatile
issue of whether some people should be encouraged to have their diagnostic
procedures and surgeries done at private healthcare facilities rather than through
the public system. Canadian employers are among those frustrated with long wait
times and many are contemplating the option of providing access to private health
care through their Disability Management programs.
Members of the Canadian workforce are among those affected by lengthy
waits for medical intervention. At any given time, it is estimated that between 8
and 12% of the working population is off work due to a disability. (Dyck, 2000)
In fact, the duration of a disability as a result of illness and non-occupational

injury is often directly tied to how quickly the employee can access treatment.
This seems difficult to achieve in light of the fact that a recent Statistics Canada
(2006) report on access to health care suggests that of the 2.8 million Canadians
who visited a medical specialist in 2005, a significant number had difficulty in
accessing care, and if they were fortunate enough to get a specialist consultation,
the wait time before seeing that specialist was significant.
Currently, wait times concerns are still at the forefront of debate despite a
commitment made at the First Ministers conference in the fall of 2004. The
Ministers stated that they would work toward "meaningful reductions in wait

3
times in priority areas such as cancer, heart, diagnostic imaging, joint replacement
and sight restoration by March 31, 2007 ... " (Canadian Institute for Health
Information, 2006, p.2). Since little progress has been made, Canadian employers
are looking at alternative methods to assist employees in a speedier return to
work. The economic cost of disability is staggering, and business competitiveness
is affected when employees are off work because of a disability (Conference
Board of Canada, 1998). Employers are aware of the business consequences of
disability, and pro-active employers soon realize that investment in the health of
their employees makes good business sense. One potential solution for employers
would be to purchase medically necessary services such as diagnostic testing and
surgery time from a private healthcare provider in order to expedite an
employee's early return to work; much like what Worksafe BC is already doing
with some of its claimants. However, the issue of whether a Canadian should be
allowed to purchase medically necessary services privately when denied timely
access through the public system is quite contentious (Hartt & Monaham, 2002).
It would prove to be no less contentious for a company seeking health services

from a private facility.
Without getting into a full analysis of the debate, it is important to note
some key points. One side argues that private health care will create a two-tiered
system that, by default, favours those who have money and status. In addition,
opponents postulate that private healthcare violates the principles of the Canada
Health Act, and undermines one of its core tenets that the provision of health care
should be based on need rather than wealth or status. Conversely, those in favour

4
view private health care as a viable alternative that would help decrease wait
times in the public system.
The employer's roles and responsibilities in the health of their employees
has evolved dramatically over the last decade, moving from a strictly occupational
health and safety focus to providing a comprehensive healthy work environment
including programs for disability management, wellness and work/ life balance
(Conference Board of Canada- 2000). Should this trend towards holistic
workplace and workforce health include financing private surgery and diagnostic
testing? How involved should employers be in the health of their employee's?
This paper will examine whether financing private surgery is a viable option in
disability management by analyzing some of the associated benefits and risks.

Disability Management
Disability management is described as: "a systematic goal-oriented
process of actively minimizing the impact of impairment on the individual's
capacity to participate competitively in the work environment, and maximizing
the health of employees to prevent disability, or further deterioration when a
disability exists." (Dyck, 2000, p.7). In practice, managing health by promoting
healthy lifestyle and wellness initiatives cannot eliminate the likelihood that
employees will develop, at some point in their life, illnesses and non-occupational
injuries which will result in absences from work. This is when a structured
disability management program is required. Over the years, employers have come
a long way in the management of employee absences, moving from little or no
involvement to sound and progressive disability management programs.

5
There is mounting evidence on the benefits that disability management
programs offer, both for employers and their employees. For employers, a
disability management program results in a healthier workforce, reduced
absenteeism, improved productivity, lower disability costs, lower insurance
premiums and rates (Dyck, 2000).
Benefits for employees are numerous and include the following:
Dyck (2000):
•

decrease/prevent feeling of loneliness and abandonment that reduce the
employee's motivation to get well;

•

avoid delays in the employee's obtaining appropriate health/rehabilitation
services;

•

avoid a run-around for the employee from health care professional to
health care professional;

•

help prevent the development of psychological problems such as the
adoption of the "sick role" and related secondary gain;

•

help with the physical, psychological, vocational, social and financial
implications of a disability situation (p. 10).
One of the principles of disability management is early intervention. The

disability community recognizes the importance of acting quickly at the onset of
disability, not only to maintain occupational bonding but also to ensure a timely
return to work as soon as medically feasible. However, there are several factors
that can delay return to work and prolong disability despite many initiatives by
employers to facilitate the return to work. These factors have been identified by

6

Krauss et al (2001). Specifically, seven categories are known to influence the
duration of disability:
1. Workers' characteristics such as socio-demographics, psychological factors,
attitudes and beliefs, health behaviours and clinical measures.
2. Injury descriptors such as disease category, injury or illness severity, body part
injured compensability.
3. Medical and vocational rehabilitation such as acute, sub-acute and chronic
disability phase including the medical case management.
4. Job task level, physical and psychological job characteristics.
5. Organizational level employer's factors such as: people oriented culture, proactive in house return to work program, size of employer, unionization.
6. Employer or insurer based disability prevention program such as
comprehensive programs, active monitoring of claimants by insurer; early contact
of worker by workplace, modified work program .
7. Societal level; legislative, social policy and macro-economic factors such as:
litigation, complexity of compensation system, high number of job benefits, high
level of wage replacement benefits, etc. (pp. 470-475).
In the management of an employee's disability it is commonly accepted that
all of the factors listed above can influence a successful outcome; however, in
addition to these factors, it is important to note that timely access to health care
must also be considered. Lengthy waits can influence the duration of disability
and prevent timely return to work after an injury or non occupational injury. For
instance, the Fraser Institute National waiting list survey (2006) indicates the

7
median wait time between referral by the General Practitioner (GP) and
appointment with the specialist was 7.4 weeks in B.C. and the median wait time
between referral by GP and appointment with specialist by specialty was 8.8
weeks (weighted median). Orthopaedic surgery was 16.2 weeks while
neurosurgery was 21 weeks. The median wait between the appointment with the
specialist and treatment was 4.9 weeks in B.C. overall. If, in the example above, it
takes an average of 16.2 weeks to see an orthopaedic surgeon, plus almost 5
weeks for the treatment, a patient can expect to wait up to five months for
treatment. The waiting time is not limited to surgery; similar problems occur for
employees waiting for diagnostic tests such as magnetic resonance imaging
(MRI), another area of concern identified by the 2004 First Ministers Conference.
The Canadian Institute for Health (2006) indicates that outpatients can wait
anywhere between 8 to 180 days between the time of their referral and the actual
scan.
These wait times are of real concern to employers as stated by the
President of Drug Benefit Consulting: "there is a time when employees become
patients who need to rely upon the public healthcare system for medical
treatment" (Benefit and Pension Monitor, 2007). As we know, while employees
are waiting for treatment in the public system, they are away from work and
unable to contribute to the success of the organization, affecting the bottom line
and depriving a business of its human resources.
It is not the purpose of this paper to enter into the political debate around
what constitutes "timely access" to health care since consensus is difficult to

8
reach even among medical practioners, but according to the Kirby Report on the
Health of Canadians "timely access to needed care does not necessarily mean
immediate access. Nor is the issue of timely access limited to life-threatening
situations. Timely access means that service is being provided consistent with
clinical practices guidelines to ensure that a patient's health is not negatively
affected while waiting for care." (p. 99). Employers are not in a position to make
a determination that an employee's health is affected while waiting for care;
however, they can confirm that a lengthy wait influences the duration of disability
and a timely return to work.
If the employee's return to work is delayed as a result of lengthy waits in the
public sector, should the employer facilitate the recovery by ensuring the
employee gets care as quickly as possible in the private sector? What are the
benefits? What kind of diseases or injuries should be considered and why? These
are some of the questions that employers will have to consider. On the other hand,
what are the potential legal and ethical risks faced by employers? These are
serious issues that need to be examined so that Canadian employers are not only
considering this option from a business point of view but in the context of good
corporate citizenship.
Economic Benefits:

The economic benefits of early return to work are obvious. Absenteeism
costs Canadian employers about 1.75 to 2.5 times the employee's salary in direct
and indirect costs, translating into 52.2 million hours of lost time at a cost of
about $15 billion per year (Dyck, 2000). The Conference Board of Canada puts

9
the average costs of disability at $300/per day per employee not including loss of
productivity, overtime pay for healthy workers, replacement staff and low morale
(Benefits Canada, 2005). They further estimate that a single disability claim costs
Canadian firms an average of $80,000. (Canadian HR Reporter, 2005). The
Pharmaceutical Manufacturer Association of Canada recently commented that: "a
focus on strategic health recognizes that poor health adds costs to labour. By
managing health, organizations can better manage their true cost of labour ....
labour cost is not simply a function of payroll and benefits, but a function that
takes into account worker productivity, absenteeism, disability, worker's
compensation and the unfunded liability for future health benefits." (Conference
Board of Canada, 1998, p. 10) We also know that the longer an employee is off
work, the less likely they will return to work which will significantly increase the
costs of disability. For employers, the lack of timely treatment increases the cost
of wage replacement indemnity the employee receives while waiting for treatment
in the public system. Most employers in large companies have some form of wage
replacement indemnity, typically 100% of wages for a set number of weeks and
dropping to 60 to 70% of wages when on long-term disability.
For employees, the ability to access care in a private facility will not only
reduce the risk of further deterioration and complications, but will also provide a
speedier return to work. The C.D. Howe Institute (2002) indicates that: "the
waiting period involved significant pain, loss of functionality, decreased quality
of life and lost work time." (p. 15). There is also increased psychological impact

10
such as depression, anxiety and sleep disturbances." (Walker with Wilson, 2001,
7-8 in C.D. Howe Institute, p.15)
A recent article from the National Post Business (2002) on private health
demonstrates the benefits. The reporter described the case of an RCMP officer off
work for 4 months as a result of a sore hip. If he had been treated in the public
system, he would have waited 19 weeks for an MRI and 18 weeks for surgery.
The cost to the RCMP and its insurer, for long-term disability during the year he
would have been off work, was $60,000. Having the ability to get care in the
private health system allowed the officer to wait only one week for the MRI at a
cost of $700.00 and only a few days for surgery. Cost of surgery was $4,000 for a
total of $4,700. Total time off the job post-op was three weeks (National Post
Business). Fortunately, RCMP service members, WCB recipients, members of the
armed forces and prisoners in federal jails are exempt from the restrictions of the
Canada Health Act and are able to receive care in private settings, which enabled
this officer to return to work very quickly. The cost of the surgery and short
recovery time was obviously cheaper for the employer than having this officer
wait in the public system while on paid leave.
When patients are treated quickly, it minimizes the chance that their
condition will deteriorate and result in an extension of the recuperation phase.
Patients also benefit from reduced periods of pain and suffering and a quicker
return to work and full wages instead of receiving wage replacement at a lower
rate. In short, the benefits of being able to access private medical care provide a
win-win situation for the employee and the employer.

11
According to Daphne Woolf (Managing Partner of the Collin Beer Group in
Toronto), although nobody openly admits to it, perhaps because of the
controversy, some employers are already paying for private care in Canada and
the US on an informal, ad-hoc basis. (Canadian HR Reporter, 2005). Dr.Brian
Day, founder of the Vancouver based Cambie Surgical Centre has said that as
many as 50 Canadian companies sent up to 300 injured or disabled workers to his
clinic for private treatment in 2005 (Canadian HR Reporter, 2005) According to
Lynn Furlotte, Executive Director of the Specialist referral clinic in Vancouver
(personal communication, April 13, 2007), more and more employers are sending
their employees for private surgeries, primarily including orthopaedic surgery and
general surgery such as hernia repairs and vascular surgery involving the spine
and foot.

Another Side to the Benefits Equation
At first glance, the savings achieved on wage replacement combined with
all the benefits of early return to work are attractive and make business sense.
However, there is potential exposure on the benefits plan design. Health care costs
for employers are on the rise, and according to the Towers Perrin Canadian Health
Care Cost Survey (2006), employers in Canada are anticipating an 8% increase in
combined medical and dental costs for active employees in 2006 and a 3%
increase for retirees (Tower Perrin, HR Services). Factoring in these increases,
the average plan cost per active employee in 2006 is expected to rise to $2,048 per
year (medical and dental combined). In a recent survey, the Morneau Sobeco
(2004) compensation trends and projections (as cited in Isaacs-Morell,

12
www .benefits.canada.com, 2005), 57% of employers who were canvassed
indicated the increased costs of benefits are a key issue for them. Further, this
same survey indicates that plan costs will likely continue to increase because of
an aging workforce and the availability of more costly medical and dental
treatment.
How private surgery comes into play in the benefits realm is a direct
result of the Chaoulli decision (Chaoulli v.Quebec [Attorney General]). On June
9, 2005, the Supreme Court of Canada ruled that Quebec's prohibition on private
health care insurance and the inability of its resident to buy privately delivered
health care violated the Quebec Charter of Human Rights and Freedoms. While
this decision is applicable in Quebec only, it is believed that it will have an impact
across Canada.
The Chaoulli decision was the result of a patient who sued the Quebec
government after a year long wait for hip replacement surgery. In a majority
decision, the Court found "that waiting lists for health care services have resulted
in deaths, have increased the length of time that patients have to be in pain and
have impaired patients' ability to enjoy any real quality of life" (p. 27).
Employers have reason to be concerned about the potential impact this
decision will have on their ability to curb their benefits cost. Experts believe that
the Chaoulli decision will open the door to duplicate private health care insurance
not only in Quebec, but in other provinces as well. Additionally, inquiries have
been made as to who would be interested in purchasing duplicate private
insurance and whether there is a potential for duplicate coverage to be provided

13
through employer-sponsored health care insurance (Madore, 2006). Employers
are facing some exposure if they decide to pay for private surgery given that it
will be seen as an additional benefit, setting the stage that this type of coverage
should be provided as part of an employee's overall benefits package.
Furthermore, consultants in the insurance business feel that: "as a result of the
ruling, Unions and employees are expected to increase the pressure on Canadian
employers to offer private care options for doctors, specialists, and hospital visits
normally covered by the government. As we have seen, offering private health
care options would enable employees to avoid the long waiting periods often
associated with government-funded health services." (Business Insurance, 2005,
p. 1)

The real dilemma for employers considering these options is determining
which is the most cost effective. On the one hand, employers are looking at ways
of reducing the cost of their benefits by moving away from traditional benefits
plans toward flex benefits and/or health spending accounts. On the other hand,
funding for private surgery and diagnostic testing might provide significant
savings on the costs of short and long term disability plans, but could also trigger
requests from employees and unions to include private care options as part of the
overall benefits package. At the end of the day, companies will have to decide if
the benefits of paying for private surgeries outweigh the potential risk of
increasing the overall cost of their benefits plans. Employers considering this
option would be wise to obtain professional cost/benefit advice from an
economist or benefits specialist.

14
Disease Considerations
There are a wide range of diseases and conditions requiring different
treatment and interventions that can affect employees. Obviously not all of them
are suitable for private treatment given the complexity and type of care required
for some conditions (e.g. , cancer). However, one group of conditions with a
significant toll both economically and occupationally are musculoskeletal
disorders. There is extensive literature, studies and research devoted to
musculoskeletal disorders and their impact in the workplace. The Director
General of the World Health Organization (2003) Dr. Harlem Brundtland states
that: "musculoskeletal or rheumatic disorders are the major cause of morbidity
throughout the world, having a substantial influence on health and quality of life
and inflicting an enormous burden of cost on health system" (p. 1).
Musculoskeletal disorders are particularly taxing in occupational settings
given they are currently affecting the baby boom generation, the largest
component of the workforce. The baby-boomers are people born between 1946
and 1965 who were between the age of 41 and 60 years old in 2006 (Statistic
Canada, 2006 Census). According to Statistic Canada, one in three Canadians was
a baby-boomer in 2006 and 3.7 million Canadians were between the ages of 55 to
65, a fact that helps to explain the explosive impact of musculoskeletal disorders
in the workplace. The elimination of mandatory retirement in British Columbia
effective January 1, 2008 may further exacerbate this effect.
Conditions included in the broad category of musculoskeletal disorders are
osteoarthritis and osteoporosis, degenerative conditions associated with age, as

15
well as spinal disorders and rheumatoid arthritis. The World Health Organization
(WHO) describes osteoarthritis as a condition characterized by focal areas of loss
of articular cartilage within the synovial joints, associated with hypertrophy of the
bone and tickering of the capsule (WHO, 2003). Osteoporosis is a disease
characterized by low bone mass and deterioration of bone tissue which leads to
increased bone fragility and risk of fracture, particularly of the hip, spine and
wrist. According to Osteoporosis Canada, osteoporosis affects 1.4 million
Canadians, an average of one in four women and one in eight men over the age of
50. The joints affected most by osteoarthritis are the hands, spine, knee, foot and
hip, and these effects can be debilitating with respect to daily living activities,
including work. People suffering from osteoarthritis are the most likely to
undergo joint replacement surgery.
Other musculoskeletal conditions include spinal disorders (a range of
specific and non-specific musculoskeletal disorders involving the spinal column
and a range of maladies affecting the muscles nerves, inter-vertabrae discs, joints,
cartilage, tendons and ligaments of the neck and back (WHO). According to the
World Health Organization, non-specific musculoskeletal conditions are the most
frequent causes of spinal disorders and have the greatest impact on individuals,
health care systems and society as a whole.
Rheumatoid arthritis is an autoimmune disease which causes inflammation
of the joints, mostly hands or feet. It affects 1 in 100 Canadians between the age
of 25 and 50 (Arthritis Society, n.d.). A recent report from Health Canada (2003)
on the challenges of arthritis and related conditions indicates that approximately 1

16
in 6 people age 15 and older are affected by arthritis and other rheumatic
conditions. Two-thirds were women and nearly 3 of every 5 people were younger
than 65 years of age, again confirming its devastating impact on the workforce.
These diseases often hit employees during their most productive years, when their
knowledge and experience reaches its peak. Employers are losing these valuable
employees at a time when institutional knowledge needs to be transferred and
when the baby boomers are needed to mentor the younger workforce.

Musculoskeletal Diseases and the Private Treatment Option
There are several reasons that musculoskeletal diseases may be
particularly suitable for private surgery. The demographic of the population
affected by these conditions is particularly significant in today's workforce given
the large percentage of baby boomers. In addition, the economic cost of
musculoskeletal disorders alone is staggering, having been estimated at $25.6
billion (in 1994 Canadian dollars) or 3.4% of the Canada's Gross Domestic
Product (GPD; Coyte, Asche, Croxford, Chan, 1998)- direct and indirect costs
were estimated at $7.5 billion and 18.1 billion, respectively. Hospital and
physician costs represented the largest components of the direct costs of MSD at
42.1 % and 27.2%, while musculoskeletal disorders accounted for 10.3% of direct
health expenditures. Indirect costs were 2.4 times higher than direct costs. Under
the baseline scenario, lost productivity due to disability was $13.9 billion or
54.3% of total musculoskeletal costs. Musculoskeletal disorders were the most
costly disease group for women in Canada in 1998 ($8.2 billion) and the third
most costly disease group for men ($8.1 billion) according to Health Canada

17
report on arthritis (2003). Morbidity costs due to long term disability accounted
for 76.5% of arthritis costs, representing the largest cost components of arthritis at
almost $3.4 billion (Health Canada). In addition to the economic burden, there is
a significant price being paid by individuals suffering from musculoskeletal
conditions. The reduction in quality of life because of pain, stiffness, loss of
mobility of the joints, deformity, disability as well as loss of independence,
reduced social interactions, and a decline in well being, needs to be taken into
consideration as well (World Health Organization, 2003).

Wait times for musculoskeletal diseases
People suffering from musculoskeletal conditions are among those
affected by long wait periods between diagnosis and intervention. For instance,
the Joint Replacement Registry indicates that on average 40% of the wait time to
see an orthopaedic surgeon is spent between referral to an orthopaedic specialist
and the decision to proceed with surgery, while 60% is spent waiting for the
surgery itself. The information provided by each province on joint-replacement
wait times is measured from hospital booking to surgery. In British Columbia, for
the three month period ending September 30, 2005, the estimated orthopaedic
surgery wait was 51 days; the hip replacement wait estimate was 132 days, and
the knee replacement wait was 175 days (Canadian Institute for health
information, 2006). Moreover, these wait times do not include the timeline
between diagnosis and actual surgery.
As we have seen, baby boomers are the most likely to be impacted by
musculoskeletal disease. A recent Vancouver Sun article (October 27, 2007)

18
brings this point home. According to the article, active boomers do not want to
live with a disability and repair or replacement of hip and knee joints is a growing
trend amongst members of this generation. The article further suggests that the
largest increase recorded over the last decade in knee and hip replacement is for
patients between the ages of 45 and 54 years old. Hip replacement doubled in this
age group over 10 years from 1,213 in 1994-95 to 2,664 in 2004-05, while knee
replacements nearly quadrupled from 655 in 1994-95 to 2,529 in 2004-05. Dr.
Paul Sabuston, orthopaedic surgeon interviewed for this article stated that: "they
(baby boomers) are more active than their parents were. It's also a more
demanding population (than the previous generation), they don't want to be
waiting around forever, and they want to be fixed now"(p.A-4).

Legal and Ethical Risks Faced by Employers
Despite the advantages offered by access to the private system, one needs
to examine carefully some of the potential risks for employers. There are two
main issues: the potential for discrimination complaints under Human Rights
legislation and ethical concerns.

Potential Discrimination Complaints
Both the British Columbia Human Rights Code and the Canadian Human
Rights Code contain provisions prohibiting discrimination on a number of
grounds including disability and age. Each of the prohibited grounds of
discrimination applies in different settings such as denial of goods, services,
facilities, accommodation and employment (R.S.B.C. 1996, c. 210 [as amended]).
In British Columbia, the purpose of the Code is defined in Section 3:

19
a) to foster a society in BC on which there are no impediments to full and
free participation in the economic, social, political and cultural life of
BC;
b) to promote a climate of understanding and mutual respect where all are
equal in dignity and rights;
c) to prevent discrimination prohibited by this code;
d) to identify and eliminate persistent patterns of inequality associated
with discrimination prohibited by this code;
e) to provide a means of redress for those persons who are discriminated
against contrary to this code.
The Canadian Human Rights Act has similar provisions in Section 2.
Under the BC Human Rights Code discrimination in employment is
described in Section 13 as follows:
( 1) A person must not
a) refuse to employ or refuse to continue to employ a person, or
b) discriminate against a person regarding employment or any terms or
conditions of employment
because of race, colour, ancestry, place of origin, political belief, religion,
marital status, family status, physical or mental disability, sex, sexual orientation
or age of that person or because that person has been convicted of a criminal or
summary conviction offence that is unrelated to the employment or the intended
employment of that person.
Section (2) .... . .

20
The Canadian Human Rights Act outlines discriminatory practice in employment
under Section 7 which states:
It is a discriminatory practice to directly or indirectly

a) to refuse to employ or continue to employ any individual or
b) in the course of employment, to differentiate adversely in relation
to an employee on a prohibited ground of discrimination.
One might ask how an employee could successfully file a Human Rights
Complaint against his employer if the employer paid for private surgery to enable
the employee to return to work sooner. Employees on disability could allege that
the employer is providing differential treatment for disabled employees based on
their disability or age. It would be particularly relevant in cases where two
employees are off work and waiting in the public sector for much needed joint
replacement and the employer provides private surgery for one, but not the other.
The employee might be able to argue that he/she was treated differently by being
denied access to funding for private surgery despite the fact that both employees
required similar joint replacement. Having said that, let us examine the legal
requirements for discrimination complaints.
The first step required by Human Rights legislation in determining
whether an employee has been the subject of discrimination is to establish the
existence of a prima facie case of discrimination (D'Andrea, 2005). The Supreme
Court of Canada in a landmark case, Ontario (Human Rights Commission) v.
Simpsons-Sears Ltd. (1985) 2 S.C.R. 536 (as cited in Matuszewski v.B.C.
[Ministry of competition, science and enterprise]) described prima-facie as: "one

21
which covers the allegations made and which, if they are believed, is complete
and sufficient to justify a verdict in the complainant's favour in the absence of an
answer from the respondent-employer" (p. 49).
The employee has the onus of proving a prima facie case and must
prove:
a) that he or she is disabled;
b) that the conduct that he or she complains about is prohibited;
c) that the employer's conduct was influenced by it having regard to
the employee's disability or alternatively that the conduct had a
negative effect on the employee and that;
d) the employee suffered harm in the employment context as a result
of the discriminatory conduct (D'Andrea, 2005, p.4-9).
By way of contrast, Human Rights Tribunals sometimes limit themselves to three
key questions:
1)

Does the employee have a disability?

2)

Has there been adverse treatment?

3)

Was the disability a factor in the adverse treatment? (BCHRT- 200730)

According to D'Andrea (2005), the burden of proving a prima facie case is not
heavy, given that tribunals and courts find that human rights legislation should be
broadly interpreted to advance the remedial goals of the legislation.
In the examples cited throughout this paper, employees are off work as
a result of a disability and employers are contemplating financing access to

22
private health care such as surgery or diagnostic tests to expedite the return to
work. Both the BC Human Rights Code (BCHRC) and the Canadian Human
Rights Act (CHRA) prohibit discrimination on the basis of mental and physical
disability. As noted above, Human Rights tribunal have interpreted disability
broadly to cover almost all medical conditions (MacNeil, 2007). Employees
contemplating a discrimination complaint would not have difficulty meeting the
first criteria, evidence of a disability. The second criteria would be to prove that
the alleged discrimination is within one of the grounds upon which the employer
may not discriminate under the Human Rights legislation (D'Andrea, 2005). Both
the BCHRC and the CHRA prohibits discrimination in employment including
hiring, discrimination during employment, and any term of employment. The
author believes that disabled employees who are denied equal access to private
health care would have a legitimate claim.
Justice Mcintyre, in a Supreme Court of Canada decision in Law
Society of British Columbia vs. Andrews (1989) 1 S.C.R.(as cited in Matuszewski
v.Ministry of Competition, Science and Enterprise), defined discrimination as
follows: "I would say then that discrimination may be described as a distinction,
whether intentional or not but based on grounds relating to personal
characteristics of the individual or group, which has the effect of imposing
burdens, obligations or disadvantages on such individual or group not imposed
upon others, or which withholds or limits access to opportunities, benefits and
advantages available to other members of society" (p. 143).

23
The last sentence is particularly relevant to our argument. Hypothetically,
employees off work on disability as a result of a musculoskeletal disease or injury
and waiting for some orthopaedic procedures would, in the writer' s opinion, have
a valid argument that providing payment on an ad hoc, or case by case, basis to
certain employees "limits access to opportunities, benefits and advantages
available to other members of society or alternatively, imposing burdens,
obligations or disadvantages on such individual or group not imposed upon
others" (p. 143). Either way, an employee who is not considered as a candidate
for private surgery by his/her employer, or is not provided with this opportunity,
may claim that the employer is imposing a disadvantage on the employee which is
not imposed on others.
Human Rights tribunals have considered using the Law Analysis when
determining if there has been discrimination contrary to the Code (Matuszewski v.
BC [Ministry of Competition, Science and Enterprise] No.2, 2007, BCHRT 30).
Law was a Supreme Court case based on a discrimination complaint filed under

the Canadian Charter of Rights and Freedoms regarding the application of the
Canada Pension Plan rules. Although the Charter is sometimes seen to apply
primarily to the relationship between an individual and government, the Supreme
Court of Canada has provided guidelines for analysis under s. 15 of the Charter
that have been used in Human Rights complaints. They are:
A) Does the impugned law
(a) draw a formal distinction between the claimant others on the
basis of one or more personal characteristics, or

24

b) fail to take into account the claimant's already disadvantaged
position within Canadian society resulting in substantively
differential treatment between the claimant and others on the basis
of one or more personal characteristics?
B) Is the claimant subject to differential treatment based on one or more
enumerated and analogous grounds;
C) Does the differential treatment discriminate by imposing a burden upon
or withholding a benefit from the claimant in a manner which reflects the
stereotypical application of presumed group or personal characteristics, or
which otherwise has the effect of perpetuating or promoting the view that
individual is less capable or worthy of recognition or value as a human
being or as a member of Canadian Society, equally deserving of concern,
respect and consideration. (Law v. Canada [Minister of Employment and
Immigration] , 1999, 1 S.C.R. 497).
The Supreme Court of Canada explains the comparative approach the
claimant must follow by choosing the person, group, or groups with whom he or
she wishes to be compared for the purpose of the discrimination inquiry. Some of
these factors outlined by the Supreme Court of Canada are:
a) Pre-existing disadvantage, stereotyping, prejudice, or vulnerability
experienced by the individual or group at issue;
b) the correspondence, or lack thereof, between the ground or grounds on
which the claim is based and the actual need, capacity, or circumstances of
the claimant or others.

25
c) the ameliorative purpose or effects of the impugned law upon a more
disadvantage person or group in society.
d) the nature and scope of the interest affected by the impugned law.
When employers consider who amongst their disabled employees will be
eligible for private diagnostic tests or private surgery, they will likely consider
factors such as the medical condition of the employee, the position the individual
has within the company, the cost/benefit analysis, the age of the employee and
which disabled employee will most likely benefit from the procedure. In the B.C
human rights decision on Matuszewski, the Tribunal member was relying on the
Law Analysis and used the comparator group analysis outlined by the Supreme

Court of Canada to render a decision on equal access to benefits - the benefit in
this case being quicker access to treatment resulting in decreased pain and
suffering while allowing the employee to return to work more quickly. In the
Matuszewski case, the complainant was alleging discrimination on the basis of
physical disability. Mr. Matuszeski was not accruing service seniority while on
LTD. The Tribunal member completed a thorough analysis both under the
traditional approach and the Law analysis and determined that the plaintiff had
established a prima facie case of discrimination; therefore, it was up to the
employer to establish a defence. In determining a proper comparator group for
Mr. Matuszewski, the member drew upon the definition established by the
Supreme Court of Canada in Hodge v. Canada (Ministry of Human Resources
Development) 2004, S.C.C. 65 in Matuszwski which states:

26
"the appropriate comparator group is one which mirrors the characteristics
of the claimant (or claimant group) relevant to the benefit or advantage
sought except that the statutory definition includes a personal
characteristic that is offensive to the Charter or omits a personal
characteristics in a way that is offensive to the Charter. .. the usual starting
point is an analysis of the legislation (or state conduct) that denied the
benefit or imposed the unwanted burden. (at para 23 and 24) in
Matuszewski" (p.48).
If we apply the previous analysis to a potential discrimination complaint
from employees denied the benefit of equal access to private surgery, the
appropriate comparator group would be the group of employees on disability in
that company who are on the public sector wait list for orthopaedic surgeries, or
alternatively, the group of employees in that company on disability as a whole. If
an employee was denied access to private surgery on the basis of age, an
argument could be made that discrimination occurred as a result of age and the
employee's treatment was different because of his age, a prohibited ground under
Human Rights legislation.
Regardless of the approach used, the prima facie case or the Law
framework, there are several circumstances that could give rise to scrutiny by the
courts if one employee decided to challenge an employer who paid for private
surgery for some employees and not for others.

27

The Ethical Dilemma
Another risk employers need to take into account when considering
payment for private surgery is that presented by the ethical perspective. "Ethics is
the philosophical study of morality; it is the systematic exploration of questions
about what is morally right and morally wrong." (Keating & Smith, 2000 p. 13.)
Rachels (2003), a teacher of philosophy at the University of Alabama at
Birghinham, describes the minimum concept of morality as follows: "morality is,
at the very least, the effort to guide one's conduct by reason- that is to do what
there are the best reasons for doing- while giving equal weight to the interest of
each individual who will be affected by what one does" (p. 14).
More and more companies are developing a business Code of Conduct to
provide guidance to their employees on how to make the right business decisions,
and how to behave in a manner that reflects high ethical standards. Typically,
content within a code of business conduct includes items such as: respecting the
right of others, obeying the law, conducting oneself appropriately in our
relationship with government, community and customer (the previous is extracted
from the author's own company manual). One area where ethics is particularly
critical is around the employer-employee relationship. Employers must treat their
employees with respect, dignity and fairness . The development of legislation on
human rights, employment standards, labour relations codes and the Canadian
Charter of Rights and Freedoms all contain provisions to protect employees from

28
discriminatory practices. It is the writer's opinion that the field of disability
management is particularly vulnerable to ethical issues.
Employers that are currently paying for private surgeries, and those who
are examining this option, may look at this like any other business decision.
Business cases are prepared based on the following: identification of the problem
or opportunity to be addressed, business and operational impact assessment, risk
assessment, cost/benefit analysis, etc. If we apply these principles to the issue of
determining under what circumstances an employer should pay for private
surgery, companies will likely consider the following: cost of the surgery, cost of
wage replacement while the employee is off work, relative importance of the
employee's current position, job demands such as mobility requirements, age of
the employee, overall health of the employee, which employees would benefit the
most, and which employees would be most likely to return to work as a result of
the surgery. These are all legitimate criteria from a business perspective.
In an effort to illustrate the underlying complexity of these types of

decisions, let us examine the decision making process in the context of two
employees who are off on disability as a result of osteoarthritis, both requiring hip
replacement. Employee A is 45 year old who works in a physically demanding
job; Employee B is 60 year old and works in an office environment. From a pure
business perspective, the employer is more likely to fund surgery for Employee A,
the 45 year old who needs his mobility in order to perform his job, and whose
recovery may be quicker and who has several years of employment ahead of him.
Both employees are incapacitated, in pain, and both are affected in their activity

29
of daily living. Is the 45 year old truly more deserving than the 60 year old? Is it
right to pay for the younger employee because he has more working years ahead
of him than the 60 year old? Is the 60 year old's welfare less important than the
45 year old's? In light of Rachel's definition of morality, have we considered the
interests of the 60 year old when we decide as a company that it makes good
fiscal sense to pay for the 45 year old but not for the 60 year old? Can we think in
terms of our return on investment when we deal with employees on disability? As
employers, are we not expected to treat employees with dignity and fairness by
providing them with equal access to benefits and opportunities, and are we doing
this by paying for some and not others? Can we hide behind the fact that the 60
year old employee will eventually receive treatment in the public system? Is this
any different than employees on Worker's Compensation who are already
jumping the public health queue with the blessing of the Canada Health Act?
These are difficult questions that need to be asked, and therein lies the ethical
dilemma for employers. What is the right thing to do? Should a company make
these kinds of decisions? Should employers rely on an intermediary and let the
employee's physician determine if going the private route is appropriate? Even in
those circumstances, the employer may be faced with the dilemma of determining
which cases makes business sense. What if the employee does not return to work
following surgery because of unrelated health concerns? Answers to these
questions are not yet clear, but as Disability Management practitioners, we should
anticipate fielding these types of questions from senior management, or at the
very least expect to be asked to make recommendations in similar circumstances.

30
Companies who are considering funding private health care alternatives
might be wise to engage an ethics committee or ethics consultant who can
examine each case on its merits and ensure that the final decision can withstand
scrutiny from an ethical perspective. Such consultation may include guidance
from ethical decision making models. For example, a decision making framework
was developed by the Markkula Center for applied ethics at Santa Clara
University (Velasquez, Moberg, Meyer, Shanks, McLean, DeCasse, Andre,
2001). It provides some useful guidelines to assist employers in dealing with
ethical business dilemmas. First, the employer needs to recognize that that there is
an ethical issue. Then all facts should be investigated and alternatives considered
based on different ethical perspectives, i.e.:
1. the Utilitarian approach: the ethical action is the one that will produce the
greatest balance of benefits over harms.
2. the Rights approach: the ethical action is the one that most dutifully respects
the rights of all affected;
3. the Fairness or justice approach: the ethical action is the one that treats people
equally, or if unequally, that treats people proportionately and fairly;
4. the Common good approach: the ethical action is the one that contributes most
to the achievement of a quality common life together;
5. the Virtue approach: the ethical action is the one that embodies the habits and
values of human at their best.

31
After examining all the potential impacts, the stakeholders should come to
a consensus and decide on the best course of action for the company and the
affected employees. This is not intended to be a philosophical paper, nor is the
author an ethicist. However, the many questions raised make it clear that
employers must carefully examine the potential dilemmas they will face when
considering if the purchase of medically necessary services from private health
care providers is a viable option under Disability Management. Additional
investigation is needed to examine all legal and ethical ramifications for
employers.

Conclusion
As we have seen, employers are facing more and more challenges in the
field of disability management. The workforce is aging and despite the fact that
baby boomers are healthier than previous generations, given their increased
activity and life-span they are also more susceptible to degenerative diseases such
as musculoskeletal disorders. The elimination of mandatory retirement in British
Columbia further increases the risk as employees opt to work beyond age 65.
This reality, combined with rising health care premiums, means employers have
no choice but to look at ways of decreasing their disability costs. Paying for
access to private health care and surgery might be one avenue. However,
employers will need to balance disability cost savings against the increased cost
of providing these services through benefit plans. To complicate matters further,
the legal and ethical risks posed in managing such a program, to ensure fair and
equitable access for all employees, requires careful consideration. In the absence

32
of well-defined case law and legal precedent, employers will need to tread
carefully if they intend to explore these largely uncharted waters.

33
References
Canadian Institute for Health Information. (2006). Waiting for Health Care in
Canada: What we know and what we don't know.
Canada. (2002). Parliament, Senate- Standing Committee on Social Afairs,
Science and Technology. The Health of Canadians- The Federal Role.
Vol.6, Recommendations for Reform. Ottawa. The chair was the
Honourable Michael J.L. Kirby.
Chaoulli v. Quebec (Attorney General). (2005) 1. S.C.R. 791, 2005 SCC 35
retrieved September 7, 2007 from: http://scc-lexum.umontreal.ca/cgi-bin
Coyte, P.C, Asche, C.V., Croxford, R, & Chan, B. (1998). The Economic cost of
Musculoskeletal Disorders in Canada, Arthritis Care and Research, Vol.
11, No.5, p.315-325.
D'Andrea, J.A, Corry, D.J, & Forester, H.I. (2007) Illness and Disability in the

workplace. How to navigate through the legal Minefield. Canada Law
Book.
Dyck, D.E.G. (2000). Disability management: Theory, Strategy and Industry

practice. Butterworths. Canada
Esmail, N, & Walker, M.A. (2006). Waiting your turn. Hospital waiting lists in
Canada, 16th edition, Critical Issues Bulletin, Vancouver: Fraser Institute
Gonzalez, G. (2005). Canadian high court rejects ban on private health coverage.

Business Insurance, Vol. 39, iss.25; p.4, 2 pgs retrieved July 25, 2007
from Proquest, database ABI/Inform, Global, Canadian Research Index,
CBCA reference.

34
Hansen, D. (2007, October 27). Younger patients opt to fix hip and knee joints.
The Vancouver Sun, A.4
Hartt, S.H, & Monahan, P.J. (2002) The Charter and Health Care, C.D. Howe
Institute Commentary, No 164.
Health Canada. (2003). Arthritis in Canada. An ongoing challenge. Ottawa:
Health Canada. (CAT.# H39-4114-2003 E).
Isaacs-Morell, C. (2005). The HAS impact. Benefits, p.53-55.
Keatings, M, & Smith, O'N, B. (2000). Ethical and Legal issues in Canadian
Nursing. 2nd edition, Elsevier Science Canada.
Klie, S. (2005). Private health coverage enters benefits realm. Canadian HR
Reporter, Vol. 18, iss. 15, p. 1, 2 pgs, retrieved July 24, 2007 from
Proquest.
Krause, N, Frank, J.W, Dasinger, L.K., Sullivan, T.J., & Sinclair, S.J. (2001)
Determinants of duration of disability and return-to-work after work
related injury and illness: challenges for future research. American Journal
of Industrial Medicine. 40. 464-484.
Library of Parliament. (2006). Duplicate private Health Care Insurance:
Potential implications for Quebec and Canada. (PRB 05-71 E) Odette
Madore, Economics Division
MacBride-King, J.L. (1998). From payer to player- The Employer's Role in the
Canadian Health Care system, Report 246-98 (Ottawa: The Conference
Board of Canada).

35
MacNeil, K.D. (2007). The Duty to Accommodate in Employment, Canada Law
Book
Mauszewski v. B.C. (Ministry of competition, Science and Enterprise) (No.2).
2007 BCHRT 30
Osteoporosis Canada
Polk, G. (2007). Employee versus patients: does the same prescription apply? ,
Vol. 17. issue 2, p.39-41
Rachels, J. (2003). The Elements of moral philosophy, 4th edition. McGraw Hill
Sharratt, A. (2005). Disability rising, Benefits Canada, Vol 29, Iss 4. pp. 13
retrieved August 3, 2007 from Proquest.
Statistics Canada. (2006). Census: Portrait of the Canadian Population in 2006,
by age and sex: highlights, retrieved on September 13, 2007 from
http://www 12.statcan.calenglishlcensus06/analysis/agesex/highlights.cfm
Statistic Canada. (2006). Access to Health care Services in Canada, 82-575 XIE,
January to December 2005.
The Burden of musculoskeletal conditions at the start of the new Millenium.
Report of a WHO Scientific Group. Geneva, World Health Organization,
2003 (WHO Technical Report Series, No. 919)
Towers Perrin - HR Services. (2006). Health Care costs are still rising: Is it a time
for a new approach to workforce health? Trends and Directions in Health
care costs.
Van Kampen, K. (2002, February). surgical strike: Dr. Brian Day is a big
supporter of public health care. But in order to save a sick system, he has a

36
radical cure: cut a piece of it off and move it to his own clinic and other
private-sector centres. National Post business. Retrieved July 30, 2007
from Proquest database.
Velasquez, M, Moberg, D; Meyer, M.J., Shanks, T, McLean, M.R, DeCosse, D,
Andre, C, & Hanson, K.O. (1988) A framework for thinking ethically.
Retrieved October 27, 2007 from Santa Clara University, Markkula Center
for applied ethics. Web site:
http://www. scu.edu/ethics/practicing/deci sion/framework.html.