Canadian Healthcare System

The U.S. Supreme Court is set to rule yet again on the Affordable Care Act in June. Their large ruling thus far declared Obamacare legal because it is a tax. This next ruling regarding the legality of federal subsidies is also poised to send shockwaves throughout the country. Discussions about healthcare reform in the United States often contain references to Canada, but many of those references are inaccurate. The intent here is not to discuss healthcare reform in the U.S. nor other healthcare systems (socialized or otherwise). Rather, this is a clarification on what occurs in Canada. This will be a brief (short and to the point like all my posts) three-part summation. We have taken a brief look at the Canadian physicians and also how healthcare in Canada is funded. Finally, let’s take a look at the structure of the Canadian healthcare system.

The Canadian Health Act of 1984 is the law that frameworks healthcare in that country. As individuals enroll in the program they are issued a health card which enables them to receive health care services which the government deems “essential”. As I outlined in yesterday’s post, there are a multitude of services which are not covered and thus the individual must pay for themselves (either out-of-pocket or through insurance). It is unlawful for private insurance to duplicate public healthcare system benefits. Private insurance is only allowed to address coverage gaps, similar to supplemental insurance in the United States (yes, the AFLAC duck).

I think one of the biggest misnomers about Canadian healthcare is that it is “free”. It definitely is NOT free. Canadians pay heavily for healthcare through the tax system. In 2013, the average Canadian family paid $11,320 in taxes just for the public healthcare insurance. Furthermore, the cost of public healthcare (before inflation) has increased 53% just in the past 10 years and is now running a deficit of $540 billion.

Hospital care is provided by publicly funded hospitals and under the law, hospitals are required to operate within their budget. Since the cost of healthcare is rising (in Canada as it is everywhere else), hospitals are cutting costs and eliminating services. Approximately 30% of the healthcare budget is consumed by hospitals.

Canadian healthcare is very controversial and it is beyond the scope here to get into that debate. I will however end with a few items. Canadian healthcare receives very high marks for breast and colorectal cancer survival rates, primary care, and preventing costly hospital admissions from chronic conditions such as asthma and uncontrolled diabetes. The system receives very low marks for the extensive wait times that patients experience. Poll after poll show that Canadians like the notion of public healthcare, but those polls also show that Canadians understand the system is unstainable and in need of massive reform.

This concludes our three-part summation of Canadian healthcare. I hope you found it insightful and perhaps it helped to clarify some questions and misnomers.

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