“The best way to predict the future is to invent it.”
— Alan Kay
There exists a positive relationship between innovation and economic growth. Innovation is associated with the attempt to improve existing processes, the clustering of related activities, and cross fertilization between unique knowledge domains. This is especially true for IT in which a technology developed for one unique purpose may meet unexpected needs, encounter broad application, and pioneer new areas of economic activity.
Canadian health care costs represent approximately 11% of GDP versus a 9.5% average for OECD countries. In the U.S. health care accounts for 17% of GDP, with this share projected to rise to 20% by 2021 (growing 1.5% faster than the overall economy). In the U.S. Alzheimer’s disease will cost $203 billion this year with this cost expected to grow to $1.2 trillion by 2050 (recent research implicates brain trauma in Alzheimer’s). Global GDP was USD $84.97 trillion (PPP) in 2012. With 10% of this amount represented by health care this results in world wide health expenditures of USD $10.2 trillion, a figure which dwarfs the USD $2.4 trillion military share of global GDP.
Overall, global health care spending is deemed likely to increase due to growing wealth in the developing world, the needs of an aging global population, and the increased incidence of age related illness such as stroke, adult onset senility and other medical conditions associated with a degeneration in cognitive processes. The World Health Organization estimates the world population of people aged over 60 will more than triple between 2000 and 2050, surging to 2 billion.
The City of Ottawa presently hosts a strong tech sector and a number of existing health care research initiatives. These include the Ottawa Health Research Institute associated with the University of Ottawa, Children’s Hospital of Eastern Ontario, The University of Ottawa Heart Institute, and The Royal Ottawa Mental Health Centre. Ottawa is also home to one of two universities in Canada offering a PhD program in cognitive science through the Carleton University Institute of Cognitive Science (the other being UQUAM in Montreal). The University of Ottawa sponsors a Neuroscience Research Institute and an Institute of Mental Health Research.
Ottawa presently hosts over 100 technology companies of various size. A significant proportion of Ottawa’s technology growth may be attributed to organizations spun out of Bell-Northern Research later known as Northern Telecom (1976) or Nortel Networks (1998).
The proposed organization will not achieve the scale or scope of any of the organizations above. It does however have the potential for positive interaction with existing firms and research institutes and would contribute to growing a vibrant health technology cluster in Ottawa.
Neurotrauma injuries (brain injury, spinal cord injury) impact over half a million Ontarians and create a cost burden to the province in the order of 2 to 3 billion annually.
— Ontario Neurotrauma Foundation
Research shows that 20% of people in forensic psychiatric settings in Ontario have a history of brain injury. There is increasing evidence of brain injury playing a role in addictive and anti-social behaviours both of which incur significant social costs. When coupled with the projected rise in age related dementia, and similar illness, it is evident that even a relatively minor advance in treatment would deliver significant fiscal benefits. Add the potential for increased entrepreneurial activity in the health technology sector to create new industry targeting the global export market and it is clear that there exists a significant set of economic opportunities available to the province.
The proposed organization does not deliver such results on its own; it does participate in the growth of an emergent health technology sector. It represents an edge activity which extends into the community and helps increase the visibility of all related initiatives. If you are not directly involved in technology then technological benefits remain obscure and invisible even when you hold a technical marvel in your hand and communicate with it daily. The proposed organization presents technological advance within the context of an easy to understand framework, a human narrative highly accessible to the general public.
There are 112,900 annual cases in Canada, the population living with mTBI numbers 670,000 and the direct and indirect costs are estimated as being US $6,760,000,000.
— Traumatic Brain Injury Care Systems: 2020 Transformational Challenges,
Dr. Denis H.J. Caro, Global Journal of Health Science Vol. 3, No. 1; April 2011
An estimated 57% of health care spending is represented by labour costs. The increased utilization of technology in the health care sector will likely result in relatively static sector employment due to either increased productivity, or improved treatment protocols. In essence, the composition of expenditure will shift with a growing proportion of present labour spend being directed toward desired technologies.
This transition will largely be out of the hands of government; the next decade will likely see a substantial shift from a health-care system based on a reactive illness model to a health care system based on a proactive wellness model. This transition will not be driven by government spending, or exhortation, but by consumer demand. This transition will likely first emerge within the United States as their present health care system is politically divisive, not economically viable over the long term and, given the decline in average real incomes, increasingly unaffordable.
Questions that need to be addressed are:
- What proportion of this transition will occur within Canada and generate new export markets for innovative Canadian firms?
- What proportion of this transition will result in the displacement of Canadian jobs via technological imports from foreign firms?
Given the size of the health care sector, the fact the health care sector is well remunerated, and that each health care worker therefore supports a significant number of other jobs within communities all across Canada, the answer to these questions has significant long term impact on the balance of payments, the value of the dollar, and future employment demand. A response of “Let the unemployed all move to Fort McMurry” does not represent a viable long term economic policy.