Dr. Kevin Smith, the president and CEO of the University Health Network.RENÉE RODENKIRCHEN/The Globe and Mail
Remember this scene in Cast Away? The resourceful Tom Hanks character, stranded on a desert island, builds a raft to try reach the open ocean. But he keeps getting pushed back by the unrelenting waves.
Dr. Kevin Smith can probably relate. As president and CEO of the University Health Network, Smith oversees the third-largest research organization and No. 1 research hospital in Canada.
Newsweek magazine rated UHN the third-best hospital in the world, behind only the Mayo Clinic and Cleveland Clinic, making it the top publicly funded hospital on the planet. But that “publicly funded” part is a problem.
In 2024, UHN poured about $600 million into research, roughly twice as much as the next-ranked hospital. The potential benefits are vast. But the costs of health care keep rising in waves, while government funding is stretched to the limit, and philanthropy can only do so much.
How can UHN and the country’s health care system keep growing and improving to meet the needs of Canadians when its financial base is increasingly overwhelmed? The resourceful Dr. Smith has answers, to that and a few more questions. We spoke at his office in Toronto.
Six years past the start of the COVID-19 pandemic, how would you describe the state of the Canadian health care system?
The people who deliver care and science and training are tired. They’ve been through a lot. We continue to have significant demands. Our emergency rooms are super busy. Primary care has been greatly disrupted, and we know that not everyone has a primary-care doc. So access is the No. 1 challenge.
The changing demography and expectations, as well. Canadians are saying they want more rapid access to services. At the same time, our growth potential economically is limited by the public purse. Every year, every government of every stripe spends way more money on health care.
Unfortunately, spending is not keeping pace with the expansion based on inflation, population growth, aging and amazing new therapies. And that is very stressful to those of us who deliver care, and particularly those of us who are trying to invent new models of care.
We’ve got ER patients waiting for hours, stuck on stretchers, being treated in hallways. People wait months for surgeries while operating rooms close by 4 p.m. because they’re underfunded and understaffed. Ontario’s approach seems to be to fund the building of operating rooms in private clinics. Is that the right approach?
The right approach is multiple approaches. The flashing light of the emergency room is the symptom. The illness is flow. We don’t have capacity across our system. You may not like waiting to have an ambulatory care visit and then go home, but that’s not the real problem.
The real problem is the frail, sick person who needs to be admitted. We can’t get them out of the ER because somebody else is already in the acute or long-term care bed or the rehab bed or can’t get enough home care to go home. And we’re not going to solve today’s problem with yesterday’s solution.
I think the most powerful medical tool in our arsenal is this. [Holds up his mobile phone.] The opportunity of virtual care, AI-assisted care, supportive, technologically based care, is dramatic. If I could make your in-patient surgery day surgery, and send you home with expert care and monitoring, and a rapid response when required, I could do way more surgeries.
A bunch of doctors are due to retire soon. I guess that means the problem is going to get worse?
Or it means we’re going to have to look at how we use physicians differently. The good news is that we have two new medical schools opening, so we’re growing the number of people we’re training. The challenge is, every doctor costs the funder roughly $1 million minimum, when you think about their income, their prescribing pattern and the other things that result from passing patients through the system.
How do you fund this on a tax base at a time when we have a lot more demand, and when we’re looking to government to stabilize a whole bunch of other industries at this time of great rupture? I fully support universal access, but are there other funding models we can work with? I don’t see how a place like UHN can remain among the best in the world if we only look to the public purse.
It sounds like you’re leaning toward a U.S. model.
I’m absolutely not leaning to a U.S. model. My examination would be Europe and other Commonwealth countries. Most people don’t appreciate that 40% of what we spend in health care is already in the private sector. All physicians are individually incorporated. They work in the private sector. What’s different is, for most physician services, there’s only one payer—the public purse and a tax base that isn’t keeping pace with our needs.
We need to look at what other funding mechanisms might be possible. What would a not-for-profit medical insurer look like in Canada? I think that when you default to a government funding model and a government insuring model, it isn’t necessarily easy for a political process to push forward on innovation.
Let’s talk about innovation. Canada doesn’t develop medicines the way they do in the States. We don’t have big pharma companies. What do we do well?
We discover.
What do we discover?
We discover and undertake science for the discovery of molecules, medicines, patents, methodologies. We are a great scientist. Unfortunately, as soon as that happens, there is no commercialization engine. We spend $400 billion a year on health care in Canada. I am hard-pressed to buy anything that’s Canadian-made. [Presents a sheaf of printed pages.] In the pages that are there, I’ve taken the liberty. You’re the first person from the media that I’ve shared this with. I’ve literally looked around the world, and that document is a playbook for how Canada can become the ecosystem to translate science to commercial benefit and access. We are big enough. Ireland is 4.5 million people; they have one of the largest drug manufacturing environments in the world. Insulin was invented here at the University of Toronto and Toronto General. But today, no insulin revenues come to Canada. They go to Denmark, the United States and France. How many other lost discoveries do we have because our venture capital is not that risk tolerant? Our taxation structure doesn’t reward it. That document is the template for Canada to be a superpower in science and medicine. That’s how you prevent universal access from being eroded.
Dr. Smith oversees the third-largest research organization and No. 1 research hospital in Canada.RENÉE RODENKIRCHEN/The Globe and Mail
What would implementing this system cost?
I have not costed it out in the way that I will, obviously. There will be significant upfront investment. There will be required changes in taxation. How did Denmark, Germany, the U.S. do this well? They invested in science, engineering and mathematics. And they created a corollary investment system that rewarded people who’d take a bet on that. We’re spending the money anyway. We’re sending it to foreign countries. Keep it here.
Would it mean diverting money from other research?
I don’t think it would. If you’re a vaccine researcher in the U.S. right now, you’re dead. You can’t get any research funded. An anti-vaccine leader holds the highest office of science in the U.S. If you were a vaccine manufacturer, wouldn’t you want to be in a nation that supports and believes in science? Wouldn’t you want to be where the best scientists are? We should be recruiting people who have the potential to build those industries. Create the science here, create the manufacturing here, create access to the Canadian population here, and create an export model. Translate science into products and products into wealth and wealth into taxes that fund our system.
I want to pick up on the reference to Robert F. Kennedy Jr. What influence do you see here from the MAHA movement in the States?
We have to be careful not to be too glib, because the largest outbreak of measles isn’t in the U.S. It’s in Alberta. So we have a lot of challenges with scientific belief and scientific logic in our own country, as well. I’m not proud to say the uptake of flu vaccine by our own staff is not what I would like it to be. And we are the most science-based hospital in the country. We were the first hospital in the province that said, if you want to work here, you have to get vaccinated against COVID. A couple hundred people said, “I don’t want to do that.” They didn’t have a good medical reason, and they departed us. And I regret that they departed us. What I don’t regret is…I don’t know why you’d want to work here if you don’t believe in science. That is in our core DNA.
You mentioned recruiting. From your experience, when scientists come to Canada, how many of them stay and thrive?
It depends on how well they do attracting operating grants, particularly mid-career scientists. We do pretty well at early-career. Later-career are usually so successful that it’s not as problematic. But mid-career is what we have to really think about. Will they have the infrastructure? Fortunately, with the CFI being established by then Prime Minister Jean Chrétien, we began to address the infrastructure shortfall. That continues to be an investment that’s required. The current prime minister is a very research-intensive person who truly understands how the translation of knowledge into goods and services creates a vibrant economy. Now I think it’s more important than just the economy. Now it’s about solidarity. It’s about protecting supply chains. It’s about getting Canadians the scarce resources they need, including medicines.
Let’s talk about AI. You’re working to integrate AI into UHN work flows. How is it going so far?
Most of the big American hospitals would be deploying hundreds of active AI products. We are deploying 10s, 20s, 30s and 40s. We’re one generation behind, which may not be a bad thing. We’re already seeing many, many AI companies falter. On the level of health care, there will be a lot of false starts. Most of the initial stuff that we looked at and some that we tried to deploy was for low-value work. But AI is not cheap. So the ROI on some of these things actually doesn’t have a good payback. Where I see the value is on high-value work. A physician could treat four patients instead of one in the same amount of time. Our surgeries could be sped up, so we could get two patients through in the same period of time.
How are you staffing to implement AI?
Three streams. One, AI scientists are now an essential part of our research recruits, and almost every program would have them on their research team. The second is integrating them into evaluating products and making sure they complement our technology suite. We have something called the AI Hub, where we look at what AI products might fit our needs and whether they align with our other technological platform. We run a system called Epic, which is the predominant system of big academic hospitals. It wouldn’t make sense for us to select a product that is, de novo, never going to integrate well with Epic. The third piece will be to continue to evaluate, does this satisfy our users, both patients and providers? We also have a human-factors lab looking at how to incorporate this into the work flows of busy clinicians. We don’t want to take people who are already frustrated by overly bureaucratic models and put more frustration into their day.
The University Health Network has taken major steps to integrate artificial intelligence into daily workflow at its hospitals.Doug Ives/The Canadian Press
Any examples of how you’re using AI?
One of our docs, Heather Ross, has developed a heart-failure product called Medly, which uses AI every day. You take your blood pressure with an automatic cuff and your weight with an automatic scale, and it downloads your data. And AI and a nurse practitioner adjust your medication every day, automatically. Every time we avoid an exacerbation of those patients getting heart failure, we don’t damage their heart muscle further, and we don’t require a hospital admission. So big, bold things. The hard part is, in our system, how do you fund that? It’s not an essential medical service. Canadians are predisposed to say, “Well, I already paid for health care in my taxes.” So it is, again, a frequent discussion around how innovative technologies will be implemented early.
Among your peers, how unique is your comfort in thinking about commercializing aspects of our health care?
Most of us who work in the sector are scratching our heads over the way costs are going up, well beyond inflation. We have an aging and growing population, and we have these remarkable new technologies, some of which are outrageously expensive. We’re inventing cancer drugs that are $1 million a patient. How do you fund that in an exclusively tax-based way? Would I ever want to see us go to a commodity-based, price-only system that says if you can pay, you can have as much care as you want? No. Do I think there are models of funding where we can be more creative and efficient? They exist. For example, the Workplace Safety and Insurance Board, while employer-funded, is a private health care system in Ontario. The key is, don’t disadvantage people who are not economically advantaged. Canada is one of the richest countries in the world, with one of the strongest scientific enterprises in the world. The best treatments should be available here, to everybody. We have to figure out a way to fund that. And it won’t be exclusively through taxation.