Estimating Dr. Day’s conflict of interest
Sharpen your pencils, open your spreadsheets, everyone. It’s contest time!
Following up on a recent post noting the major financial conflict of interest of the Canadian Medical Association calling for more private health care options, we can expect more ideological rhetoric to come in the next year as new CMA President Brian Day takes the helm next week. But as the co-owner of a private clinic in Vancouver, Day’s advice should be treated with suspicion, given that he stands to benefit from expansion of private care, possibly to the tune of millions of dollars. So it would greatly inform the public interest if we had some estimates of how much Day’s stake is worth.
Here’s the question: Estimate the ten-year personal financial gain to Dr. Day from greater privatization of public health care. Use the comments area, be transparent about your assumptions, and show your work (partial credit will be awarded). The winner will be announced in a future post.
Here are some factoids to get you started (sorry but I no longer have all of the original links):
There are some competing numbers on the size of Day’s Cambie clinic. A story by Pamela Fayerman in the Vancouver Sun, June 3 2005, posted on Day’s website, had Cambie doing 5,000 operations per year.
An article in the National Post, by Karen Van Kampen, Feb. 2, 2002 put the average cost per procedure at $2,500.
Another story in the New York Times by Clifford Craus, February 26, 2006, estimated annual revenue of $8 million (US dollars) or about $9 million in Cdn dollars at current exchange rates.
According to a report by Rod Mickleburgh in the Globe and Mail, July 12, 2004, Cambie has profit margins of 30 per cent. But not all of this goes to Day. The original plan for Cambie had 22 investors putting in $100,000 each plus a loan from the Royal Bank of $2.6 million, with Day putting up the rest.
Day has plans to expand his private clinics across Canada. In such cases, Day may be the sole investor not just one of twenty.
According to the August BC Business magazine, “Day believes 25 per cent of all services in most sections of the medical services guide could be eliminated. Examples include bunions, varicose veins, breast reduction and nose jobs.”
Over to you.