Replacing paper ID such as driver’s licences and health cards with smart cards would reduce the amount of fraud perpetuated on the health care system and prevent identity theft, says the CEO of the Advanced Card Technology Association of Canada.

Catherine Johnston, who participated in a roundtable

on smart cards at GTEC, says the days of the magnetic stripe card, which is easily replicated by criminals, are over. Pointing to a 19 per cent increase in health care costs in Ontario over the past two years that can’t be explained by a corresponding growth in the population or the cost of the services, Johnston said it’s time to take the next step.

“”We can’t afford this cost anymore so we’re cutting our own services, so yes, we have to move,”” she said. “”The technology that served us so well in the past now puts us at risk.””

Solving the problem

Ron Hysert, a consultant with Deloitte’s security services group, however, said he could find no conclusive research supporting claims of widespread health care fraud.

“”You’re asking whether making a citizen carry a smart card solves the fraud problem; maybe it does and maybe it doesn’t,”” he said. “”I’m still carrying a red and white OHIP card and I’m not asked for any ID when I go to the hospital. You can solve that kind of problem with better mechanisms than we have now. My worry is if you jump into a smart card solution without doing the business case appropriately, you may end up with an expensive technology that only solves part of your problem.””

Gord Swan, senior project co-ordinator for the development of the government’s Canada-wide smart card policy development, agreed. “”Even if we issue a smart card, what is the issuance based on?”” he said. “”What is the fundamental foundation for identity? How do you know this person is in fact a resident of Ontario and entitled to receive health care? I’d be very concerned about them having to spend a lot of money because they not only have to issue the cards, they have to equip all the doctors and hospitals with the infrastructure to read the cards. I think there are simpler technologies that solve this problem.””

Even if smart cards do reduce fraud, the question remains as to whether Canadians would accept them or not, and according to Swan, they wouldn’t. Even if they did, it would be hard to enroll everyone in the country. “”I believe the research indicates Canadians do not want a national ID card,”” said Swan. “”They do not want a single number that can be cross-referenced. You’ve got to allow for that segmentation of data.””

But it depends why you collect the data and how you use it, said Muhammad Mustafa, an associate with IBI Group working on the City of Toronto’s smart card pilot. Mustafa, who has worked extensively with smart card applications for transit, says the majority of people who buy smart cards for transit choose to offer personal information and register their cards, which then enables them to to block the card or get refunds if the card is lost.

Even if Canada were to issue national ID smart cards, it wouldn’t necessarily be a success, warned Peter Öhman, business manager of Finland-based smart card vendor Miotec Oy. Finland, he said, embarked on a smart card project three years ago and has so far issued fewer than 20,000 smart cards in a country of five million. Even in a small country with a good infrastructure, he added, it was a tough sell. “”It’s not much of a success story,”” he said. “”I think one thing is that there were no examples. We were the first country in the world to do a project like this and it wasn’t that easy, but I think we have learned quite a lot from the mistakes that were made.””

If Canada did make the smart card move, it wouldn’t be to a single smart card, said Swan. “”Although the technology will support a single card, the management and privacy issues are too complex to resolve at this time. I definitely don’t think there’s any appetite in Canada for a single smart card at all.””

Use existing technology

Mustafa disagreed. “”I would lean toward a single card,”” he said. “”Multi-application smart cards are more convenient. The technology allows us to have more than one application on the card, so why not use that technology?””

As well, he argued, there is a better business case for a multiapplication card, in that costs can be shared among service and application providers.

Johnston said smart cards are an evolution Canada will eventually embrace. “”Government online is a wonderful initiative and right now you don’t need a smart card, but as you start to use it and you see the convenience in the service, you’re going to want it to be very portable, and therefore you’re going to want that secure token,”” she said.

“”ATMs changed our lives, but I now find ATMs as inconvenient as I used to find going to the bank. I want to have an ATM in my hand and I can do that today; the technology exists and that kind of focus on the convenience — that is what has taken so many countries into this and we’ll follow shortly.””

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