2005 Exploring the 70/30 Split: How Canada’s Health Care System Is Financed

2005 Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
2005
Exploring the 70/30 Split:
How Canada’s Health Care
System Is Financed
The contents of this publication may be reproduced in whole
or in part, provided the intended use is for non-commercial
purposes and full acknowledgement is given to the Canadian
Institute for Health Information.
Canadian Institute for Health Information
495 Richmond Road
Suite 600
Ottawa, Ontario
K2A 4H6
Telephone: (613) 241-7860
Fax: (613) 241-8120
www.cihi.ca
ISBN 1-55392-655-2 (PDF)
© 2005 Canadian Institute for Health Information
Cette publication est aussi disponible en français sous le titre :
Le ratio 70/30 : Le mode de financement du système de santé canadien
ISBN 1-55392-668-4 (PDF)
Exploring the 70/30 Split:
How Canada’s Health System Is Financed
Contents
About the Canadian Institute for Health Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . v
Acknowledgments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .vi
About This Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . vii
PART A: Setting the Stage
Chapter 1: Health Financing in Canada and the World . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
How Did It All Start? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
The Public/Private Mix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Private Financing—Out of Whose Pocket? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Out-of-Pocket Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Private Health Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
For More Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10
Chapter 2: The Canadian Reality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Looking Forward From the Canada Health Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16
Who Pays and What the Money Covers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18
Making the Decisions: What to Include in the “Basket” of Health Services? . . . . . . . . . . . . . . . . . . . 22
For More Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
PART B: A Primer on Canada’s Health Care System—What It costs
Chapter 3: A Primer on Canada’s Health Care System—What It costs . . . . . . . . . . . . . . 31
Health Spending Trends in Canada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Health Spending Compared . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
The Public/Private Financing Split . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
PART C: Snapshots of Spending on Health Services
Chapter 4: Hospital Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Who Uses Canada’s Hospitals? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Where Does a Hospital’s Money Go? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
The Cost of Treating Patients . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Who Pays for Hospital Care? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
For More Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
43
44
46
47
50
Chapter 5: Physician Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
A Visit to the Doctor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Health Spending on Physicians . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
How Doctors Are Paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Fee-for-Service Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Alternative Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
How Much Doctors Get Paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Overhead Costs and Physicians’ Incomes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Private Spending on Physician Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
For More Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
52
52
54
54
54
55
58
59
60
Chapter 6: Retail Drug Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Medicating More . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Who Is Covered? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Why Is Drug Spending Rising? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Who Pays? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
For More Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
63
64
65
67
71
Chapter 7: Oral Health Care Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Dental Consultations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
What Predicts Use? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Canadian Spending Compared . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
The Public Sector and Dental Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
The Primary Payers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
For More Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
76
77
78
79
80
81
Chapter 8: Eye Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
Seeking Eye Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Public Insurance Coverage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
More Than Pocket Change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
For More Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
84
85
87
89
Chapter 9: Continuing Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
Residential Care Facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
Use of Residential Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
Spending on Residential Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
Home Care Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
Use of Home Care Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
Coverage of Home Care Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
Spending on Home Care Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
Beyond the Health Care System: Informal Support From Family and Friends . . . . . . . . . . . . . . . . . . 99
For More Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
Chapter 10: Mental Health Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
Who Is and Isn’t Using Mental Health Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Who’s Paying for Mental Health Care? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
The Cost of Mental Health Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
For More Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
106
109
110
111
Chapter 11: Complementary and Alternative Medicine . . . . . . . . . . . . . . . . . . . . . . . . . . 113
Seeking Care Outside the Doctor’s Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Coverage for CAM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Spending . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
For More Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
114
117
117
118
Appendix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119
Order Form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131
It’s Your Turn . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 133
About the Canadian Institute for Health Information
About the Canadian Institute for Health Information
The Canadian Institute for Health Information (CIHI) is an independent, panCanadian, not-for-profit organization working to improve the health of Canadians
and the health care system by providing quality health information. CIHI’s mandate, as established by Canada’s health ministers, is to coordinate the development and maintenance of a common approach to health information for Canada.
To this end, CIHI is responsible for providing accurate and timely information that
is needed to establish sound health policies, manage the Canadian health system
effectively and create public awareness of factors affecting good health.
For more information, visit our Web site (at www.cihi.ca).
As of August 1, 2005, the following individuals are members of CIHI’s Board
of Directors:
• Mr. Graham W. S. Scott, Q.C. (Chair), McMillan Binch Mendelsohn LLP
• Ms. Glenda Yeates (ex officio), President and CEO, CIHI
• Dr. Penny Ballem, Deputy Minister, British Columbia Ministry
of Health
• Dr. Peter Barrett, Physician and Faculty, University of Saskatchewan
Medical School
• Ms. Jocelyne Dagenais, Assistant Deputy Minister of Strategic
Planning, Evaluation and Information Management, Ministère de la
Santé et des Services sociaux
• Ms. Roberta Ellis, Vice-President, Prevention Division,
Workers’ Compensation Board of British Columbia
• Mr. Kevin Empey, Vice President, Finance and Corporate Services,
University Health Network
• Dr. Ivan Fellegi, Chief Statistician of Canada, Statistics Canada
• Ms. Nora Kelly, Deputy Minister, New Brunswick Ministry
of Health and Wellness
• Ms. Alice Kennedy, Vice-President, Resident Care, St. John’s
Nursing Home Board
• Dr. Richard Lessard, Director of Prevention and Public Health,
Agence de développement de réseaux locaux de services de
santé et de services sociaux de Montréal
• Mr. David Levine, President and Director General, Agence de
développement de réseaux locaux de services de santé et
de services sociaux de Montréal
• Mr. Malcolm Maxwell, CEO, Northern Health Authority
• Dr. Brian Postl, CEO, Winnipeg Regional Health Authority
• Mr. Morris Rosenburg, Deputy Minister, Health Canada
• Mr. Ron Sapsford, Deputy Minister, Ministry of Health
and Long-Term Care, Ontario
• Ms. Sheila Weatherill, President and CEO, Capital Health
Authority, Edmonton
v
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Acknowledgments
The Canadian Institute for Health Information (CIHI) would like to acknowledge
and thank the many individuals and organizations that have contributed to the
development of this report.
We would like to express our appreciation to the members of our expert
group, who provide invaluable advice throughout the development process,
including reviewing a draft of the report. Members include:
• Mr. Steven Lewis, President, Access Consulting Ltd.;
Centre for Health and Policy Studies, University of Calgary
• Dr. Ian McKillop, JW Graham Chair in Health Information Systems,
University of Waterloo
• Dr. George H. Pink, Associate Professor, University of North Carolina
• Ms. Nancy White, Manager, Home and Continuing Care, CIHI
• Mr. Nawaf Madi, Consultant, Mental Health and Addictions, CIHI
It should be noted that the analyses and conclusions in the report do not necessarily reflect those of the individuals listed above or their affiliated organizations.
The editorial committee for this report included Jennifer Zelmer, Jack
Bingham, Jacinth Tracey, Jenny Lineker and Patricia Finlay. Health Reports staff
who contributed to the development of the report were Cheryl Gula, Sharon
Gushue, Chad Gyorfi-Dyke, Luciano Ieraci, Thi Ho, Tina LeMay, Maraki Merid,
Mary Neill and Anne Tenenbaum.
Production of this report involves many people and many aspects of the
CIHI organization. We want to thank all CIHI staff for their contribution to this
report, including individuals from publications, translation, communications,
clinical administrative databases, classifications, health expenditures, health
human resources, distribution services and the Web.
We would also like to acknowledge Marlene Orton for her writing/editing work.
vi
This report could not have been completed without the generous support
and assistance of many other individuals and organizations who compiled data,
assisted with quality assurance, or otherwise supported the development of
this report.
About This Report
About This Report
In a 2004 contest sponsored by CBC Television, viewers were asked to name “the
greatest Canadian.” The winner was the late Tommy Douglas, popularly known as
the “father of Medicare.
When Canada’s health care system—known widely as “medicare”—was
created, hospitals and doctors provided most health services. Medically necessary services were paid for primarily out of the public purse. Over time, the
health system has grown to embrace an ever-broadening range of services.
The 70/30 Split
Total spending on health care has risen, and private spending by individuals or
insurers has been growing more quickly than public spending. Today, about 70%
of total Canadian health expenditures comes from the public purse. The remainder (about 30%) comes from private sources. In this report, we look at trends in
financing and at variations in this 70/30 split across provinces and territories. This
includes a close examination of several specific health services. We hope that this
report, which aims to provide a clear, detailed and comparative picture of health
financing in Canada, will assist policy-makers and Canadians in understanding
who pays for what types of care.
The report is divided into three parts:
Part A: Setting the Stage
Chapter 1—Health Financing looks at the different ways that health financing
systems are structured in Canada and other Organisation for Economic
Co-operation and Development (OECD) countries.
Chapter 2—The Canadian Reality outlines how Canada’s current health system
evolved, examines the legislative framework that sustains it and looks at the scope
of public health coverage.
Part B: A Primer on Canada’s Health Care System—What It Costs
Chapter 3 takes an in-depth look at health spending in Canada. It shows provincial/territorial comparisons, outlines the public- and private-sector contributions to
health care spending and provides international comparative data.
vii
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Part C: Snapshots of Spending on Health Services
Part C explores the use of specific health care services in Canada as well as the
public and private insurance coverage and private spending on each. These
health care services include:
Chapter 4—Hospital Services
Chapter 5—Physician Services
Chapter 6—Retail Drug Sales
Chapter 7—Oral Health Care Services
Chapter 8—Eye Care
Chapter 9—Continuing Care
Chapter 10—Mental Health Services
Chapter 11—Complementary and Alternative Services
The result is a rich body of information, compiled in one place for the first time.
But many important questions remain. For example, our information base is much
stronger for some types of health care than for others. And we know relatively little
about some funding flows (for example, subsidies through the tax system for outof-pocket spending and health insurance purchases). Over time, we hope to continue working with our partners to improve our collective understanding of a system that now consumes more than $130 billion per year.
viii
1
Health Financing in
Canada and the World
What would a perfect health care system look like, and how would we pay
for it? Over the last decade, many countries have explored alternative ways
of organizing and financing health services in an attempt to answer these
questions. In Canada, the debate over whether what we have can be sustained—and whether what we have is what we want—has spawned several
provincial and federal reports. More recently, the Supreme Court of Canada
also weighed in on the debate.
1
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Canada is not alone in wrestling with these questions. Health care systems throughout the world reflect historical, geographical, cultural, social and economic factors
that are unique to each country. However, economically developed countries’ health
care systems share many similar features and face common challenges. The most
pressing may be the speed with which health care costs have been growing, sometimes faster than the countries’ economies as a whole.1 This chapter examines
major themes in the debate about how to finance health services.
How Did It All Start?
Health insurance in Canada dates as far back as the 17th century. In 1655, the
Hôtel-Dieu de Montréal hospital initiated a medical plan under which physicians
would dress wounds and prescribe treatment for an annual fee.2 However, the
concepts behind what we now recognize as “medicare” developed in Europe
in the late 1800s. The systems now found in most Organisation for Economic
Co-operation and Development (OECD) countries are based to varying degrees
on the models that emerged at that time.
Health care systems evolve in response to many factors, including changing
concepts in the broader political economy. Because these concepts are common to many OECD countries, health reform initiatives tend to converge around
similar themes.3 For example, the concept of “classic universalism” took root
after World War II. According to this notion, all people should have equal access
to health care services, and these services should be available free of charge,
regardless of age, sex or health status.4 By the early 1960s, many OECD governments had begun to invest more heavily in social programs, including health
care.3 In the 1970s, many countries saw a significant rise in health care costs,
although there was little evidence that this directly resulted in better population
health. Some experts worried that this marked the beginning of the time when
“there seemed no natural limit to health care spending, and it appeared that
demand could increase infinitely.”3
Containing costs became a focus in many parts of the world, although
approaches and results differed. More recently, total health expenditures have
begun to rise again in many countries. Government budgets in particular have
felt the strain because, on average, three-quarters of OECD spending for health
care comes from public funds.1
2
Health Financing in Canada and the World
The Public/Private Mix
Using the words “privatization” and “health care” in the same sentence is
enough to spark debate in many countries. In a 2002 report, the World Health
Organization noted that “privatization has become one of the most controversial
and value-laden terms in the European health care lexicon.”5
The role of the private sector can
be controversial, because for many
people the debate about who should
finance health care goes to the heart
of societal values. In most OECD
countries, health care is seen not as
a commodity, but as a public good.3
Also, health care is part of wider social
security systems, where governments
are responsible for ensuring that public
policy goals are met.5
Linguistic Landmines?
In the search for solutions to
health care financing challenges,
language can become an issue
in itself. The meanings of words
are often influenced by the particular context in which they are
used. Terms that mean one thing
in one country may acquire a
completely different meaning in
another. As one expert noted,
“the symbolic import of the language of health reform should
never be underestimated.”3
Another challenge is that the phrase
“private health care” means different
things to different people. This may be
partly because of confusion over relationships between the various dimensions
of the health care system. These are summarized below:
Canada’s Health System
Financing, Ownership and Delivery
S
iva
of
Ownership: may include public agencies as well as
privately owned and/or traded companies.
Pr
y
er
te
es
ic
v
er
Delivery: the public and private sector both deliver
health services to Canadians, with the private sector
playing a significant role.
Source: Adapted from I. McKillop, J. Alpenberg,
R. G. Evans, et al., Private Sector Delivery: Scope
and Extent in Canada’s Health Care System,
(Waterloo: University of Waterloo, 2004).
Public
Ownership/Operation
Private P
ub
lic
liv
De
Financing: about 70% of financing for health care
in Canada comes from public sources, 30% (about
$39 billion) comes from non-public sources.
Public
Private
Source of Funding
3
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
In recent years, many OECD countries have been looking at ways to
increase the private financing of health care in order to shift cost pressures
from public systems to the private sector.6 Some are focusing on expanding
private delivery of services. Others are looking to increase private financing as
a means of containing public spending on health. Measures include introducing
or expanding private (voluntary) insurance, cost sharing and reducing the
services covered by public health insurance plans.5 While there is evidence
that the introduction or expansion of private financing measures may help lower
public-sector health care spending (but not total health expenditures) in some
countries, researchers suggest that it may also negatively affect access and
equity.6–8 A recent study suggests that the dynamics and effects may depend on
the nature of the relationship between public and private financing. The authors
identify four basic models for structuring this relationship:
Parallel public and private systems: private financing exists as an alternative to public insurance for a given range of services.
Copayments (a form of cost sharing): payment is partly financed through
the public sector for various services. The remainder is financed through
out-of-pocket payments and/or private insurance. In many countries, income
is a factor that determines levels of copayments.
Group-based: only certain sectors of the population are eligible for public
coverage; the rest may be covered by private health insurance.
Sectoral: certain health care sectors are fully financed by public insurance.
Others are dependent to varying degrees on private-sector funding.7
Private Financing—Out of Whose Pocket?
Private-sector funding—primarily through private health insurance and out-ofpocket payments—accounts for between one-fifth and one-third of health expenditures in most OECD countries. At 30% in 2004, Canada falls within this range. The
private sector mainly pays for services beyond hospital and physician care, such
as drugs, dental and vision services. Canada’s private share is similar to those of
Spain and Australia, but higher than that of the United Kingdom, France, Germany
and Sweden.9
4
Health Financing in Canada and the World
Most private-sector health spending in many OECD countries comes
through out-of-pocket payments. In 2002, private health insurance accounted for
less than 10% of total health expenditures, except in Canada, the United States,
France and the Netherlands. In Canada, private health insurance and out-ofpocket payments pay for roughly equal shares of private-sector spending.9 In
the other three countries, payments through private insurance exceeded those
made out-of-pocket by individuals.
Subsidizing Private Spending
In some countries, private health insurance
premiums and out-of-pocket health care
expenses are fully or partially tax-deductible.
For example, researchers estimate that when
tax breaks are taken into account, nearly 60% of
health spending in the U.S. is publicly financed.8
In Canada, the Child Disability Benefit, the
Disability Tax Credit and the Medical Expense
Tax Credit cost about $1 billion in 2004.11 Other
tax subsidies also exist.
Studies have shown that countries
with multiple payers—that is, many different sources of financing—are among
those with the highest health expenditures.1 Researchers suggest that this
may partly be because countries tend
to apply cost-containment measures
only to the public system. Studies have
also shown that administrative costs
are also higher in systems with multiple
payers—and can be significant.6, 10
1 What Happened in the 1990s?
All OECD countries saw health spending per person rise in the 1990s (not
adjusted for inflation). This occurred across countries with very different
mixes of public and private financing, as shown in the graph below.
Per Capita Expenditure (U.S.$)
6,000
U.S.
5,000
4,000
CAN.
3,000
2,000
1,000
0
0
20
40
60
80
100
% Total Expenditure on Health From the Public Sector
2002
1992
Notes: Expenditures are converted to U.S. dollars using purchasing power parities (PPPs) for gross
domestic product (GDP), which are designed to eliminate differences in price levels between countries.
The OECD asks that member countries report health expenditures according to their system of health
accounts. The 12 countries that most closely follow the proposed system of health accounts are Australia,
Canada, Denmark, France, Germany, Hungary, Japan, South Korea, the Netherlands, Switzerland, the UK
and the U.S.
Source: OECD Health Data 2005, OECD.
5
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Over the past decade, less than half of OECD countries reporting data saw
increases in the private share of health spending, while for others it was constant or
decreased. Other countries saw public-sector spending growth outpace that in the
private sector. Canada’s private share rose from 28% in 1994 to 30% in 2004. This
was primarily due to increased payments through private health insurance plans.
How private money is spent also differs significantly between countries. Unlike
many others, Canada funds hospital and physician services almost entirely through
taxes. User fees and copayments for these services are relatively common in other
parts of the world. About half of western European countries apply some form of
copayment for first contact care, while others apply it only to outpatient care.5
Private insurance and out-of-pocket payments in Canada tend to be higher for
services not covered under the Canada Health Act.8
2 Going Without Needed Care
Out-of-pocket payments include
all costs directly met by consumers. This covers cost sharing
through copayments, user fees,
purchases of over-the-counter
medication and health supplies
and similar costs. Out-of-pocket
payments can be grouped into
three categories:
Direct payments for goods
and services that are not
covered by any form of
pre-payment, insurance,
or public funding;
6
Cost sharing (also referred to
as “copayments”), where the
individual pays part of the cost
of care received. The user may
pay a fixed fee, a fixed proportion
of a fee for an item or service or
some combination of the two; and
In 2004, a Commonwealth Fund study asked adults in five countries whether
in the past year there had been a time when they went without care that
they needed because of costs. In all countries, adults with below-average
incomes were more likely to say yes than the population as a whole.
Canada’s rates fell in the middle of those reported by other countries,
as the graph below demonstrates.
60
% Without Needed Care Due to Cost
Out-of-Pocket
Payments
57%
50
44%
40%
40
35%
34%
30
20
29%
26%
17%
0
12%
9%
10
All Adults
Australia
Adults With Below-Average Incomes
Canada
New Zealand
UK
U.S.
Source: 2004 Commonwealth Fund International Health Policy Survey.
Informal payments, which are unofficial payments for goods and services,
sometimes referred to as “under-the-table payments.”10
Health Financing in Canada and the World
In 2002, individual Canadians paid an estimated $17 billion (out-of-pocket)
to cover various health care services, up from $13 billion in 1998. For example,
they spent $3.6 billion out-of-pocket health care dollars on over-the-counter
drugs and personal health supplies.
Personal health supplies include oral
Effect of Copayments
hygiene products, diagnostic supplies
Although most Western countries allow or impose
(for example, diabetic test strips) and
copayments for some services covered by public
medical supplies (such as incontinence
insurance, there are large variations in the size and
products). Other major areas of out-ofrange of these payments. Most copayments come
from individuals—only a few countries, such as France
pocket spending include dental care
and New Zealand, allow the use of private insurance
($3.4 billion), prescribed drugs ($2.9
to cover copayments.6, 7
billion), nursing homes and other
institutions ($3.0 billion) and vision
What effect do copayments have on access to care
and outcomes? Probably the best-known study to
care ($2.0 billion).
address this question is the Rand Health Insurance
Experiment in the U.S.12 It randomly allocated particiPrivate Health Insurance
pants to insurance plans with different copayment
structures. The study found that those in plans with
Research suggests that in most OECD
higher user fees, particularly individuals with low
countries private health insurance plays
incomes, used fewer services. But sick people were
a supporting role in publicly financed
more likely to die when user charges were in place,
systems.6 In 2002, private health insurand rates of inappropriate antibiotic use and hospital
ance accounted for an average of 7.2%
admissions were about the same regardless of the
of total expenditures on health and about
level of user fees.
22% of private health spending in comA large Canadian study based on the experience in
parator OECD countries. Over the last
Saskatchewan in the 1970s found similar results.
decade, there has been relatively little
When copayments were in effect, the poor used fewer
7
change in the percentage of total health
physician services. Moreover, because high-income
residents used more physician services and physician
expenditure covered by private health
fees increased, overall health care costs were not
insurance across the OECD.9
lower when copayments were in place. Studies have
shown that in both New Zealand and France it is priThe role of private health insurance
marily those with lower incomes who use health serv6, 7
varies
from country to country. For
ices less when they have to pay user fees. And, as in
example, in France, the Netherlands
Saskatchewan, the introduction of copayments in
Switzerland did not reduce total health expenditures.13
and Canada, it accounts for anywhere
from 10 to 17% of total spending on
American, Canadian and Western European studies
health. This represents about half of
have also found that cost sharing for out-of-hospital
pharmaceuticals decreases utilization for the elderly
all private spending. In OECD countries
and those in lower-income groups. This has been
with significant levels of private health
linked to adverse health outcomes and higher utilization
insurance, a large proportion of it is
of emergency departments among these groups.7, 10, 14
usually provided by employers.
Likewise, New Zealand research suggests that some
people avoid seeking help for early symptoms and
may end up in emergency rooms because they are
unable or unwilling to pay a user fee (about CA$30)
to consult with a family physician.13
7
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
For example, a recent study found that this was true for 90% of private
insurance policies in the U.S. and Canada, 60% in the Netherlands and 50%
in France.6
In Canada, insurance company
costs amounted to $14 billion in 2002,
up from $9 billion in 1998. Together,
prescribed drugs and dental care
accounted for more than two-thirds
(67%) of spending through private
insurance. A further $2.3 billion went
towards pre-payment administration
for private health insurance plans.
A recent study identified five
distinct roles played by private
insurance.10 Two or more of these
roles overlap in many countries.
Researchers suggest that:
• In the U.S., private health insurance is dominant. That is, it is
a principal method of financing
health care. Private health
insurance, which is purchased
voluntarily, accounted for almost
37% of total expenditure on
health in the U.S. in 2003.9
The Australian Experience
Australia’s universal, publicly financed system
includes physician services, inpatient hospital care,
pharmaceutical benefits and a range of other services.
There is also a smaller, parallel private insurance
system that covers inpatient hospital care, among
other services.15 In the mid-1990s, less than a third
of the population had private hospital insurance.
Following the recommendations of a governmentcommissioned report, Australia introduced incentives
to encourage purchase of private hospital insurance.
By 2000, coverage reached 43% before dropping
off again.15
Studies have shown that the incentive scheme did
not reduce overall public spending on health care,
because the cost of the incentives (in 2000, 6% of
all public spending on health care) exceeded any
potential savings to the public purse. There was
also no reduction in wait times. Finally, Australia
regulated the private insurance industry—requiring
it to offer community-rated premiums to all enrollees
regardless of their health.7
• In Switzerland, the purchase of private health insurance is compulsory.
The private health insurance industry is tightly regulated. The regulations
ensure open enrolment, community-rated premiums and a standardized
minimum package of benefits.
8
• Substitutive insurance is designed for those excluded from, or allowed to
opt out of, public health insurance plans. For example, in the Netherlands
and in Germany, individuals with higher incomes are not eligible for
public health insurance.
Health Financing in Canada and the World
• Complementary insurance covers services excluded from or only partially
covered by public insurance. In Canada, complementary insurance is
available for outpatient drug costs, dental care and many other services
not covered under provincial and territorial plans. In a few cases, complementary insurance may also cover copayments for publicly insured
services. Countries that allow such practices include France, Denmark
and Sweden.
3
• Supplementary insurance usually covers services provided by public
health insurance systems and may be referred to as “double coverage.” It
is mainly positioned as a tool to increase choice—either of provider (that
is, private physician) or of facility (that is, access to private hospitals or
to private facilities in a public hospital)—but it may also be marketed as a
way to receive faster access to care. This form of public health insurance
is available in many European countries and is the main form of private
insurance in Spain, Sweden and the UK. Prior to a June 2005 Supreme
Court decision striking down a prohibition in Quebec against using private
health insurance to pay for publicly insured services, it was illegal to use private insurance
Where the Money Comes From
to pay for physician and hospital
Some economically developed countries rely, to a varying extent, on the
services covered by provincial
public sector, private insurance and out-of-pocket payments by individuals
to cover the costs of health care. The figure below shows the proportion of
insurance plans in six of Canada’s
health spending coming from each of these sources for 2002. Canada’s
10 provinces. In the other four,
private sector funds a larger share of health spending than all other
such insurance remains rare.12
countries except the U.S. Within this envelope, we rely more on out-ofpocket payments than many other countries.
U.S.
Japan
Italy
Germany
France
Canada
0
20
40
60
80
100
% of Total Health Expenditure
Public Sector
Out-of-Pocket
Private Insurance
All Other Private Funds
Note: Public and private expenditure figures for France are estimates; public expenditure figures for
Japan are estimates.
Source: OECD Health Data 2005, OECD.
9
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
For More Information
1. Organisation for Economic Co-operation and Development, Towards
High-Performing Health Systems (Paris: OECD, 2004).
2. J. Bannerman, Leading Ladies Canada (Belleville: Mika Publishing
Company, 1977).
3. A. Bloom, “Context and Framework of Health Sector Reform,” in Health
Reform in Australia and New Zealand, ed. A. Bloom (Australia: Oxford
University Press, 2000).
4. World Health Organization, The World Health Report, 2000: Health Systems:
Improving Importance (France: WHO, 2000).
5. World Health Organization, The Role of the Private Sector and Privatization in
European Health Systems (WHO, Regional Committee for Europe, 2002).
6. F. Colombo and N. Tapay, Private Health Insurance in OECD Countries:
The Benefits and Costs for Individuals and Health Systems (OECD Health
Working Papers) (Paris: OECD, 2004).
7. C. H. Tuohy, C. Flood and M. Stabile, “How Does Private Finance Affect
Health Care Systems: Marshalling the Evidence From OECD,” Journal of
Health Politics, Policy and Law 29, 3 (2004): pp. 359–396.
8. Commission on the Future of Health Care in Canada, Building on Values: The
Future of Health Care in Canada (Final Report) (Ottawa: Commission on the
Future of Health Care in Canada, 2002), [online], cited July 15, 2005, from
<http://www.hc-sc.gc.ca/english/care/romanow/index1.html>.
9. Organisation for Economic Co-operation and Development, OECD Health
Data 2005, (CD-ROM), (OECD, 2005).
10
Health Financing in Canada and the World
10. Health Evidence Network, What Are the Equity, Efficiency, Cost Containment
and Choice Implications of Private Health-Care Funding in Western Europe?
(Copenhagen: WHO Regional Office for Europe, 2004).
11. Department of Finance Canada, Tax Expenditures and Evaluations—2004
(2004), [online], cited July 15, 2005, from <http://www.fin.gc.ca/taxexp/
2004/taxexp04_2e.html#Table%201>.
12. Canadian Health Services Research Foundation, Mythbusters: A Series of
Essays Giving the Research Evidence Behind Canadian Healthcare Debates
(2001), [online], cited July 15, 2005, from <http://www.chsrf.ca/mythbusters/
pdf/myth4_e.pdf>.
13. Conference Board of Canada, Challenging Health Care System Sustainability,
Understanding Health System Performance of Leading Countries (2004),
[online], cited July 15, 2005, from <http://www.conferenceboard.ca/
Boardwiseii/signin.asp>.
14. R. Tamblyn, R. Laprise, J. A. Hanley, M. Abrahamowicz, S. Scott, N. Mayo,
J. Hurley, R. Grad, E. Latimer, R. Perreault, P. McLeod, A. Huang, P.
Larochelle and L. Mallet, “Adverse Events Associated With Prescription Drug
Cost-Sharing Among Poor and Elderly Persons,” Journal of the American
Medical Association 285, 4 (2001) pp: 421–429.
15. J. Hurley, R. Vaithianathan, T. F. Crossley and D. Cobb-Clark, Parallel Private
Health Insurance in Australia: A Cautionary Tale and Lessons for Canada
(Australia: Centre for Economic Policy Research, Australian National
University, 2002).
11
2
The Canadian
Reality
Health spending and health care renewal have been key political
issues for many years in Canada. Now the courts are also involved.
Within the past year, the Supreme Court of Canada faced two decisions
with important implications for health policy. In the Auton case, parents
of autistic children in British Columbia argued that the failure of the
government to fund intensive (and expensive) behavioural services,
known as ABA/IBI therapy, violated the Canadian Charter of Rights and
Freedoms. In its unanimous decision, the Supreme Court disagreed. It
found that provinces and territories had the right to limit provision of
“non-core” benefits.1
13
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
The Chaoulli case in Quebec asked whether it was constitutionally justifiable to
prohibit private health insurance from covering medical and hospital services.
A court challenge by Quebec resident George Zeliotis and his physician,
Dr. Jacques Chaoulli, pushed this question to the forefront of the health care
debate in 2005. Mr. Zeliotis waited a year for hip replacement surgery in 1997. In
his challenge, Dr. Chaoulli held that when the public system does not provide
“reasonable” access to services, this prohibition violates both the Quebec Charter
and the Canadian Charter of Rights and Freedoms. He further argued that doctors
who have opted out of medicare (which is legal) should have the same access
to hospitals to treat their private-paying
patients as other doctors. The Quebec courts
Key Dates in Canadian Health
acknowledged that the patient’s rights to
Care Policy
security of the person were indeed violated,
but felt that the violation was defensible
1867: British North American Act establishes the
because of an overriding public interest.
basis for provincial responsibility for hospitals.
However, the Supreme Court of Canada,
1947: Saskatchewan introduces Canada’s
by a 4:3 majority, allowed Dr. Chaoulli’s appeal.
first publicly funded universal hospital
It ruled that the ban on private health insurance
insurance program.
to obtain medically necessary treatment in
1957: The federal government passed the
Quebec violated Quebec’s Charter of Human
Hospital Insurance and Diagnostic Services Act.
Rights and Freedoms.2
All provinces and territories were covered under
These decisions have fuelled the fires of
the health care financing debate. But it’s far
from the first time that Canadians have faced
difficult questions about what services should
be covered, for whom and at what price.3
In 1947, Saskatchewan was the first
province to establish public universal hospital
insurance.4 A decade later, the Government of
Canada enacted the Hospital Insurance and
Diagnostic Services Act to help pay for these
services. By 1961, almost all Canadians (99%)
were covered by various provincial and territorial hospital insurance plans.5
14
the cost-sharing program for hospital insurance
by 1961.
1961: Saskatchewan passes the Saskatchewan
Medical Care Insurance Act providing government insurance for physician services.
1966: The federal Medical Care Act introduces
federal and provincial cost-sharing for physician
services outside hospitals. By 1972, all
provinces and territories are participating
in the program.
1974: Marc Lalonde, the federal health minister,
releases a report called A New Perspective on
the Health of Canadians. It reinforces the idea
of broad determinants of health (including
human biology, the environment, lifestyle
choices and health care organization) and
calls for a reorientation of health care services
toward health promotion.
1977: The Established Programs Financing Act
introduces a program of federal transfers that
are not directly tied to the costs of the provincial
and territorial programs.
continued on next page
The Canadian Reality
Key Dates in Canadian Health
Care Policy continued from previous page
1979: Emmett Hall is commissioned to study the operation
and financing of health care in Canada. His report (1980)
recommends abolishing extra billing and user fees and
suggests a collaborative means of establishing provincial
physician payment rates.
1984: The Canada Health Act reinforces the basic principles
provinces and territories must follow to qualify for federal
health funding (public administration and operation, comprehensiveness, universality, portability and accessibility). It
penalizes extra billing and out-of-pocket charges for services
covered under the Act.
1996–1997: The federal contribution to health and social
services is consolidated into the Canada Health and Social
Transfer (CHST). This represented a major change in federal,
provincial and territorial cost-sharing arrangements for health
services.
2004: Based on recommendations of the 2003 First Ministers’
Accord on Health Care Renewal, the CHST is split into two
transfers: the Canada Health Transfer (CHT) and Canada
Social Transfer (CST). They consist of pre-determined cash
contributions and equalized tax transfers for health and social
programs until 2007–2008. The CHT also consists of five-year
($16 billion) funding directed toward accelerating reform in
areas identified by first ministers, such as primary health care,
home care and catastrophic drug coverage. This funding is
known as the Health Reform Transfer, or HRT.
Source: Compiled by CIHI.
It was not until 1962, however,
that Saskatchewan introduced a medical insurance
plan, following a dramatic
strike by the province’s doctors.6 Shortly afterwards, the
federal Medical Care Act
was passed. Within six years
(by 1972), all provinces and
territories had joined.5
Heated controversy
about extra billing and user
charges led to a review of
this framework in the late
1970s. Extra billing occurs
when patients pay for insured
health services over and
above what their provincial
or territorial insurance plan
pays. User fees are charges
for an insured health service
permitted by a provincial
or territorial health plan
that are not payable by
the plan itself.7, 8
Based on a recommendation by the late Emmett Hall (a former Supreme
Court of Canada justice) to abolish extra billing and user fees,5 the Canada
Health Act was passed in 1984. It replaced the two earlier Acts. This legislation
not only guarantees Canadian residents “reasonable access” to medically necessary insured services without direct user charges, it also outlines specific
criteria and conditions related to publicly insured health care services. These
criteria establish a set of principles that all provinces and territories must meet
in order to receive the full federal contribution under the transfer mechanism
now known as the Canada Health Transfer (CHT).4 While the Act does not strictly
15
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
prohibit user fees and extra billing, they are discouraged. If extra billing or user
fees occur, deductions to the federal cash transfers to the province or territory in
question may be made accordingly. As well, non-compliance with one of the five
criteria or two conditions* can lead to discretionary penalties.7
Looking Forward
From the Canada
Health Act
4 Changing Incomes: Percentage Change (1995 to 2000)
The average income for health professionals in some occupations is more than
three times that in others. This figure shows average annual employment
Over several decades,
incomes for Canadians who worked full-time for the full year in selected health
Canada’s health system
occupations in 2000, compared with the overall averages for health occupations
and all earners. It also shows the percent change in those averages since 1995,
has evolved into a vital and
adjusted for inflation.
complex segment of the
Nurse Aides and Orderlies
2.0%
economy. A tenth of our
Dental Assistants
3.5%
economic output—or $130
Midwives and Practitioners of Natural Healing
10.0%
Registered Nursing Assistants
1.5%
billion—goes to health
Opticians
5.7%
Technical Occupations in Dental Health Care
-1.9%
care. Health care costs as a
Medical Technologists and Technicians
0.4%
Dietitians and Nutritionists
2.0%
share of the gross domestic
Ambulance Attendants and Other Paramedical Occupations
7.1%
Occupational Therapists
product (GDP) rose sharply
0.9%
Nurse Supervisors and Registered Nurses
4.9%
in the early 1980s, and then
Physiotherapists
1.4%
Audiologists and Speech Language Pathologists
3.5%
again in the early 1990s,
Psychologists
6.3%
Chiropractors
-16.8%
when the economy stalled
Pharmacists
9.4%
Optometrists
13.3%
during two periods of recesDentists
6.1%
GP/FP
4.5%
sion. The economy began
Specialist Physicians
4.8%
All Health Occupations
to recover in the 1990s, but
0.0%
All Earners
5.8%
growth in health spending
0
20
40
60
80
100 120 140 160
slowed until 1997. This led
Average Income in 2000 (’000 Dollars)
to a decrease in health
Source: Census of Population, Statistics Canada; Labour Force Survey, Statistics Canada.
care’s share of the GDP. In
recent years, however, this trend has reversed. Among Organisation for Economic
Co-operation and Development (OECD) countries, only the United States,
Switzerland, Germany and France devote a larger share of their GDP to health care.
16
Forecasts for 2004 show health spending in Canada at $4,078 per person,
up 5% from 2003. Growth drivers include inflation, structural factors such as
population growth, more use of existing and new services (for example,
changes in the average number of prescriptions consumed), changes in how
services are organized and delivered and a range of other factors, not all of
which are fully understood.
To unpack these effects, we studied changes in health spending in the two
decades since the Canada Health Act was introduced. Between 1984 and 2004,
Canada’s combined public and private health care bill increased by over 250%,
rising by almost $94 billion.
*
This includes providing information to the federal Minister of Health in relation to insured health services and extended health care
services for the purpose of the Canada Health Act, as well as recognizing federal financial contributions toward both insured and
extended health care services.
The Canadian Reality
What explains this increase?
5 Accounting for Spending Growth
Between 1984 and 2004, total health spending in Canada grew by almost $94
billion. Why the increase? Many factors—from population growth and inflation
to a rise in real (inflation-adjusted) public and private spending on health care
per person—contributed.
140
120
$ Billions
100
80
60
40
20
0
1984
1994
2004
Health Spending in 1984
Growth Due to Inflation
Real Increase in Public Spending
Real Increase in Private Spending
Growth Due to Population Growth
Note: Data for 2004 are forecast.
Source: National Health Expenditure Database, CIHI.
Wage Trends
The people who provide care are the core
of our health care system. Their wages and
other payments for their services account for
a large part of what we spend on health care.
Between 1997 and 2001, Statistics Canada’s
Labour Force Survey shows that, on average,
weekly wages for full-time workers in the health
sector increased by just under 9%, compared
to 10% for workers in all parts of the economy.
Likewise, Census data show that, on average,
employment incomes for full-time workers in
health occupations rose at about the rate of
inflation between 1995 and 2000. That compares
to almost a 6% after-inflation increase for
all earners.
• Start with the $37 billion
spent in 1984.
• Now add $13 billion,
because 6.2 million
more people lived in
Canada in 2004 than in
1984. It would have cost
that much to provide them
with health services at the
1984 average level of per
capita expenditure. That’s
about 14% of the overall
increase in health spending.
• Inflation in the health
sector (for example, higher
wages for health profession
als) accounted for a further
$42 billion, or about 45% of
the growth in total spending.**
• After a brief dip in the mid-1990s, publicsector spending per person, adjusted for
inflation, also rose steadily. The result was
that we spent $23 billion more on health care
through the public sector in 2004 than in
1984. This means that about 25% of overall
growth went towards net additional care
funded from the public purse. This reflects
both more care (for example, higher rates of
hip and knee replacements or more CT
scans) and new types of care (for example,
vaccines against the chicken pox or new
drug therapies), offset by any service
reductions or efficiencies that occurred
over this period.
** This calculation is based on the health component of the consumer price index (for private-sector spending) and implicit price
indices for government current expenditure (for public-sector health care spending), both from Statistics Canada. A 2000 review
showed that the latter corresponds closely to the sub-component related to government health expenditure, which is not publicly
available. (V. Hicks, G. Fortin and G. Ballinger, Price Indexes Used in National Health Expenditures: Feasibility Study (Ottawa: CIHI,
2001), [online], from <www.cihi.ca/cihiweb/en/downloads/spend_nhexenhance_e_PriceIndexes.pdf>.
17
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
The Sustainability Challenge
• Private-sector
spending per person
also rose between
1984 and 2004,
accounting for the
remaining $15 billion
increase in spending
over this period (16%
of the growth).
Who Pays
and What the
Money Covers
In Canada, like in other
OECD countries, a mix
of public- and privatesector payers finance
health services. Public
spending—$91 billion
in 2004—covers most
public health programs,
hospital care, physician
services and care for
Status Indians and Inuit.
The public sector also
pays part of the cost of
other services, such as
home care, prescription
drugs and ambulances.
The provinces and terri-
In 2003, Canada’s premiers and the Prime Minister identified sustainability
as a key objective for health care renewal.9 “Sustainability” is a complex
concept. Many groups, both academic and government-sponsored,
have proposed frameworks to describe it. Some focus strictly on health
expenditure growth, particularly in the context of the fiscal challenges of
governments. Others argue that it’s not just about money. They identify
issues such as the future availability and distribution of health care
providers, the acquisition and use of new technologies and changing
patterns of practice as keys to sustainability.
Still another approach is to look at options for achieving sustainability
by improving value for money. This may include exploring the effectiveness and efficiency of health services (for example, reducing
overuse of ineffective interventions, underuse of appropriate health
services and adverse events) or looking ahead at how to reduce
future needs for care through a population health perspective.
Both first ministers and the Commission on the Future of Health Care
in Canada10 identified three essential dimensions of sustainability:
• the needs of Canadians;
• the services required to satisfy those
needs; and
• the availability of resources required to
provide those services.
This perspective suggests that it is the balance and interaction of these
dimensions that determine sustainability. Part of the challenge is the
ongoing evolution in each of these areas, as well as in public expectations about health and health services. While health care may be as
much a part of the Canadian social fabric as hockey or maple syrup,
specific preferences and expectations may differ across the country or
among population groups. They undoubtedly also evolve over time.
In this context, various options for promoting sustainability have been
put forward, including (but certainly not limited to) expanding user fees,
setting limits on government health spending, improving efficiency and
effectiveness of health services and increasing disease prevention and
health promotion.11
Health Needs
18
Public Preferences and
Expectations
Resources
Timely
Access to
Quality
Services
The Canadian Reality
6 Who Pays for What
Public and private payers cover part of the cost of health care in all OECD
countries. However, countries that spend about the same amount on health
care often finance these costs very differently. The table below shows the
public sector’s share of spending for different types of services in Canada
and the three OECD countries with the most similar levels of total per capita
expenditure on health in 2003.
Canada
Germany
The Netherlands
France
70%*
78%
62%
76%*
Physician services
98%
85%
N/A
74%
Curative and rehabilitative
inpatient care
93%
84%
74%
92%
Pharmaceuticals and other
medical non-durable goods
38%
75%
57%
67%
Long-term nursing care
78%
75%
98%
100%
5%
68%
N/A
36%
Total expenditure on health
Dental services
Note: *Public expenditure figures as a proportion of total health expenditure for Canada and France are estimates.
tories administer the bulk of the
public-sector health budget, part
of which is financed through
federal transfers of cash and tax
points. Direct federal programs,
municipal governments, Workers’
Compensation Boards and other
social security programs also play
a role in public-sector financing.
Source: OECD Health Data 2005, OECD.
The rest—$39 billion in
2004—comes from private sources, such as insurance plans, out-of-pocket payments and non-consumption expenditure (for example, hospital revenue from donations, parking lots, investments and
other sources). Drugs, dental care and vision care account for most private spending. Indirectly, governments bear part of these costs through foregone tax revenues. For example, firms can deduct insurance premiums from their taxable income, but employees do not pay taxes on these benefits.
The Canada Health Act establishes “medically necessary” hospital, physician and surgical-dental
services as publicly insured services. In some cases, other “extended” health care services may also
be paid for by public funds. Examples include nursing home care, home care and ambulatory care.12
19
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
While the Act sets out a broad framework, many decision points remain.
For example, the Act does not explicitly define the term “medically necessary.”
Some suggest that this opens the door for differences in what health services
are included across the country.13-15 Others argue that a strict definition of medically necessary would prevent provinces and territories from addressing the
unique health care needs and values of their own populations.13, 15 These factors
may also influence what services provinces and territories choose to fund beyond
those outlined in the Canada Health Act.10, 16, 17
The end result is a core
of services that is funded
publicly in all jurisdictions,
but the mix and extent of
coverage for others varies.
For instance, a study by
the Canadian Diabetes
Association showed that
persons with diabetes qualify
for very different coverage in
different parts of the country.18
The Canada Health Act Principles
The Canada Health Act outlines several requirements that
provinces and territories must meet through their health insurance
plans in order to qualify for full federal funds under the Canada
Health Transfer, including:
1. Public administration: Health insurance plans are administered and operated on a non-profit basis by a public authority
responsible to provincial and territorial governments.
2. Comprehensiveness: Provincial and territorial health insurance plans must insure all health services insured under the
Act (that is, physician, hospital and surgical-dental) and, where
permitted, services rendered by other health practitioners.
3. Universality: Every eligible resident of a province or territory
is entitled to insured health services covered by the insurance
plans. Residents are generally required to register in order to
get coverage.
4. Portability: Residents receive coverage regardless of where
they live and whether they move between provinces and territories. Coverage must be extended by the home province or
territory for up to three months during the waiting time for
new coverage.
20
5. Accessibility: Provinces and territories must provide reasonable access to insured health services without discrimination
on any basis, including ability to pay. This entitles residents
to insured services in the location where services are provided
and as services are available.
The Canadian Reality
7 Where You Live Matters
Jane is 23 years old and was diagnosed with Type I diabetes as a child. Every day, she
needs insulin injections in order to control her blood glucose levels. These injections
require syringes or pen devices. Jane also needs to monitor her glucose levels daily using
a lancing device, test strips and a metre to read the results. Jane’s annual income is less
than $15,000. She currently has no private health insurance and does not receive social
assistance. The supplies Jane needs to manage her diabetes are partly or fully covered in
some parts of the country—and not in others, as the figure below illustrates. The amount
that she needs to pay for her care depends on which part of the country she lives in.
Blood Glucose Strips
Lancets
Meters
Syringes/Pen Needles
Insulin
Y.T.
N.W.T.
B.C.
2
Nun.
N.L.
Que.
Alta.
1
1
1
1
1
2
Sask.
2
2
2
1
P.E.I.
Man.
1
1
1
1
Ont.
1
1
1
2
1
1, 2, 3
N.S.
N.B.
Source: Canadian Diabetes Association; provincial and territorial ministries of health.
Footnotes to Diabetes Map
B.C.
1. For insulin, syringes, pen needles: no deductible. Pharmacare immediately
provides 70% coverage. Once annual maximum is reached, Pharmacare
covers 100% of eligible expenses.
2. Coverage of blood glucose strips is dependent on recipient having a training
certificate from a Diabetes Education Centre.
Alta.
1. Government provides up to $550 per year under the Alberta Monitoring for
Health Program for blood glucose strips, lancets, and syringes.
2. Under Alberta Blue Cross Non-Group Coverage Program: for eligible prescription drugs, recipient is responsible for paying 30% of the cost to a maximum
of $25 per drug prescribed up to a maximum of $25,000 per year.
Sask.
1. Through the Special Support Program, a 3.4% deductible is paid (for insulin
prescriptions), based on adjusted family income.
2. One -time assistance through the Drug Plan for medications and diabetic
supplies listed on provincial formulary.
Man.
1. Under the Manitoba Pharmacare Program, a deductible of 2.44% of income
(less than or equal to $15,000 per year) is paid out. Once the deductible is
met, Pharmacare will pay 100% of eligible prescription drug coverage and
diabetic supplies such as blood glucose strips, lancets, and syringes.
Ont.
1. Monitors for Health (MFH) provide 65% government copayment to a
maximum of $500 per year for blood glucose strips and lancets and 65%
coverage up to a maximum of $75 for a metre once every five years for
those who are insulin dependent.
2. Trillium Drug Program provides provides a deductible based on income and
$2 for every prescription.
Que.
1. 28%Twenty-eight percent co-insurance up to a maximum of $71.42 per month
for drug costs. Deductible of $10.25 per month. Premium to Quebec prescription drug insurance plan to be paid. Amount paid ranges from $0 to $494 per
adult per year, depending on income.
P.E.I.
1. Must be registered with the Diabetes Control Program. A copayment of
$6 to $16 per prescription for insulin.
Y.T.
1. A deductible of $250 per person, then 100% coverage. Deductible may be
waived in cases of hardship.
21
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Making the Decisions: What to Include in the “Basket”
of Health Services?
Determining what’s in and what’s out of the publicly funded basket of services is a bit like umpiring a
baseball game. Some calls are clear; others are very hard to make—and there’s no instant replay to
help out.
Experts agree that no insurance program—public or private—can realistically cover every service
for everyone indefinitely.10, 19, 20 In this context, deciding which health services to fund publicly and
which to delist is a difficult task.21–23
Many, but not all, public coverage decisions are made at the provincial/territorial level. Others are
in the hands of health regions and other health care providers, individual clinicians or clinical programs. As the environment changes and as new types of care or new knowledge emerge, questions
about adding to coverage or delisting services often surface.25
The public coverage decision process is often complex. Questions about what constitutes medically necessary care, as well as the criteria used to define it, have been the source of much debate.
Experts suggest that the meaning of medical necessity may depend on how people interpret and use
the concept25 as new definitions emerge over time.10
Other factors also count in coverage decisions, not all of which are well understood. Financial
resources, public expectations, clinical expertise and knowledge and the evolution of technologies
are among the considerations in deciding which services to publicly insure.10 Within each province
and territory, there may be varying degrees of involvement by the ministry of health, professional
associations or other stakeholders.19, 26
22
The Canadian Reality
Over time, provinces and territories add and subtract different types of care
from the basket of insured services. For example, many provincial and territorial
governments stopped funding certain health services in the mid-1980s and 1990s,
partly in response to funding crunches. This process is known as “delisting.”
Some delisted services were later reinstated after public protest.25 Examples of
services fully or partially delisted in some parts of the country include routine eye
examinations, newborn circumcision, physiotherapy and chiropractic care.
While some services have been dropped, others have been added. For
example, in September 2004, the premiers and the Prime Minister agreed on
the Ten-Year Plan to Strengthen Health Care. Among the Plan’s provisions is a
commitment to provide first-dollar coverage by 2006 for certain home care
services, based on assessed need.
First-dollar coverage applies to any form of insurance (public or private) in
which the insured individual is fully (100%) covered for all eligible expenses.
The Ten-Year Plan to Strengthen Health Care includes first dollar coverage for:
• “short-term acute home care for two-week provision of case management,
intravenous medications related to the discharge diagnosis, nursing and
personal care;”28
• “short-term acute community mental health home care for two-week provision of
case management and crisis response services; and”
• “end-of-life care for case management, nursing, palliative-specific
pharmaceuticals and personal care at the end of life.”25
Did You Know?
In 2004, Pollara asked almost 2,000 Canadian
adults whether they would be willing to pay
more for an increased range of services or to
improve the timeliness of care they receive.24
Over half (54%) said yes, down from 69% just
two years earlier. Conversely, when asked
about how government might deal with the
costs of health care services, 21% of respondents said that they would support or strongly
support restricting the range of services
offered. That’s up from 19% in 2003.
23
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
8
Changes in Coverage
For many types of health care, which health services are funded from the public purse and the extent of coverage
varies across the country. Researchers at the University of Toronto tracked coverage changes over the 1990s for
private practice physiotherapy, speech therapy, dental care, optometry and chiropractic services. (Note: This does
not include, for example, services provided in hospital or through public health programs, or funded for specific
population groups, such as those on social assistance or covered by workers’ compensation boards. In some cases,
copayments or additional conditions may apply.)
Province
24
Physiotherapy
Optometry
Coverage in 1994?
Changes to Coverage in
1990s
Coverage in 1994?
Changes to Coverage in 1990s
B.C.
12 visits/year for
those <65 and 15
visits/year for 65+
No*
One visit every 24 months for those
between 19 and 64 years of age and no
limit for those <19 and 65+ years of age
No**
Alta.
$250/year
Yes, in 1995: not covered
except for those considered
high need on standardized
assessment form
Exam/diagnostic procedure every
2 years for those between 19 and 64
years of age and once a year for those
<19 and 65+ years of age
Yes: no coverage for those
>18 and <65 years of age.
Sask.
No
No
One visit/year for those <18 years of age
No
Man.
No
No
One visit every 2 years
Yes, in 1996: no coverage for
those between 19 and 64 years
of age; same coverage for those
<19 and 65+ years of age
Ont.
Yes
Yes, in 1998:
150 visits/year
Oculo-visual assessment covered
in private practice
Yes, in 1998: 1 oculo-visual assessment and 1 follow-up oculo-visual
minor assessment/ 2 years for those
between 20 and 64 years of age;
every year for those <20 and 65+
years of age
Que.
No
No
One visit/year for those
<18 and 65+ years of age
Yes, in 1996: one visit/2 years for
those <18 and 65+ years of age
N.B.
No
No
No
No
N.S.
No
No
Yes
Yes, in 1997: no coverage for those
between 19 and 64 years of age;
same coverage for those <19 and
65+ years of age
P.E.I.
No
No
No
No
N.L.
No
No
No
No
Notes:
* In 2001, British Columbia limited patients to a combined total of 10 visits per year for chiropractic, massage, naturopathic, physical therapy or non-surgical podiatric visits.
** In 2001, in British Columbia, routine optometry visits every two years were eliminated for everyone 19 to 64 years of age.
The Canadian Reality
By reviewing legislative records, the researchers identified the major changes in service reimbursement shown below. They
then looked at Statistics Canada survey data to see whether coverage changes were linked to changes in the use of services.
The answer was complex. While use of physiotherapy and eye examinations decreased after coverage changes, speech
therapy and chiropractic service use increased in some instances. And, in the case of physiotherapy, those who reported
using services before coverage changes tended to use more services afterwards.
Dental
Speech Therapy
Chiropractic Care
Coverage in 1994?
Changes to Coverage Coverage in 1994? Changes to Coverage
in 1990s
in 1990s
Coverage in 1994?
Changes to Coverage
in 1990s
No
No
No
No
Limit of 12 visits/year for
those <65 and 15 visits/year for those 65+
No*
No
No
Yes
(no details)
Yes, in 1995:
not covered
Limit of $300/year
Yes, in 1995:
limit of $200/year
No
No
No
No
Yes
No
No
No
No
No
Limit of 15 visits/year
based on the per-visit
cost of $11.56 ($12.72
in northern Manitoba);
limit of $220/year
Yes, in 1999:
limit of $150/year
No
No
Yes
No
No
No
No (except for those
<10 years of age)
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No (except for some
coverage for those
<12 years of age)
No
No
No
No
No
Source: M. Stabile and C. Ward, “The Effects of De-listing Publicly Funded Health Care Services,” (forthcoming).
25
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
9 Get Immunized
All provinces and territories have recently begun to cover four new vaccines: adolescent pertussis (whooping cough),
varicella (chicken pox), meningococcal conjugate and pneumococcal conjugate. However, as illustrated in the table below,
who is eligible varies somewhat across the country, as does when the vaccines are administered. There are even larger
variations for some other immunization programs. For example, all jurisdictions except Prince Edward Island now pay for
flu shots for some residents. Most cover at-risk individuals, seniors and health care workers. Ontario and the Northwest
Territories cover flu shots for all residents.
Provinces/
Territories
Whooping Cough
Chicken Pox
Meningococcal
Conjugate Type C
Pneumococcal Conjugate
Influenza
B.C.
Grade 9
12 mos. ‡
2,12 mos. ‡
2, 4, 6, 18 mos. ‡
65+ yrs.
Alta.
Grade 9
12 mos. ‡
2, 4, 6 mos. ‡
2, 4, 6, 18 mos. ‡
6–23 mos.
65+ yrs.
Sask.
Grade 8
12 mos. ‡
12 mos. ‡
2, 4, 6,18 mos. ‡
65+ yrs. ‡
Man.
Grade 9
12 mos. ‡
Grade 4 ‡
2, 4, 6, 18 mos. ‡
6–23 mos. ‡
65+ yrs.
Ont.
14–16 years
15 mos. ‡
12 mos. ‡
2, 4, 6, 15 mos. ‡
Que.
Grade 10
‡
12 mos. ‡
2, 4, 12, mos. ‡
60+ yrs. ‡ Health Workers
N.B.
Grade 9
12 mos.
12 mos. ‡
2, 4, 6, 18 mos. ‡
6–23 mos.
65+ yrs. ‡
N.S.
Grade 10
12 mos. ‡
12 mos. ‡
2, 4, 6, 18 mos. ‡
6–23 mos.
65+ yrs. ‡
P.E.I.
Grade 9
12 mos. ‡
12 mos. ‡
2, 4, 6, 18 mos. ‡
Not covered: cost is
$15/dose
N.L.
Grade 9
12 mos.
12 mos.
2, 4, 6, 18 mos. ‡
6–23 mos.
65+ yrs. ‡
Y.T.
Grade 9
‡
2, 6 mos. ‡
2, 4, 6, 12 mos. ‡
6–23 mos.
18+ yrs.
N.T.
Grade 9
12 mos. ‡
2, 4 mos. ‡
‡ (except Aboriginal children)
Nun.
Grade 9
12 mos.
2, 4, 6, 15 mos.
‡
‡, 6–23 mos.
‡
essential workers
Legend
‡ High Risk
Contacts of Cases or Outbreak Control
Universal/All Residents
Residents of Any Age in Nursing Home/Chronic Care Facility
Health Care Workers
26
Notes: Data are as of June 6, 2005. For specific provincial high-risk definitions, please refer to the Public Health Agency of Canada’s
Definitions of High Risk for Three New Publicly-Funded Vaccines by Province/Territory, at http://www.phac-aspc.gc.ca/im/ptimprog-progimpt/
table-5_e.html. For NACI high-risk definitions, please refer to the Canadian Immunization Guide, Sixth Edition, 2002 (National Advisory
Committee on Immunization), at <http://www.phac-aspc.gc.ca/publicat/cig-gci/index.html>.
Sources: 1. Public Health Agency of Canada, Publicly Funded Immunization Programs in Canada—Routine Schedule for Infants and Children (June 6, 2005),
[online], from <www.phac-aspc.gc.ca/im/ptimprog-progimpt/table-1_e.html>.
2. Public Health Agency of Canada, Publicly Funded Immunization Programs in Canada—High Risk Groups (June 6, 2005), [online], from <www.phac.aspc.gc.ca/
im/ptimprog-progimpt/table-2_e.html>.
3. Provincial and territorial ministries of health data, compiled by CIHI.
The Canadian Reality
The provinces and territories also agreed to develop, assess and cost options
for catastrophic pharmaceutical coverage. Furthermore, the Plan recognizes commitments to a national immunization strategy. The strategy is designed to support
the introduction of new and recommended childhood and adolescent vaccines
as proposed by the National Advisory Committee on Immunization.
10 Paying for Childhood Vaccinations
According to a 2004 Ipsos-Reid survey, many Canadian parents believe
that immunizations are as important to their children’s health as healthy food
and physical activity. Given the importance placed on immunizations, it is
perhaps not surprising that 93% of parents say they would pay out-of-pocket
for immunizations if they were not covered by a public plan. In fact, many
parents see immunizations as beneficial to the health system in general.
About 93% of parents believe that vaccinations prevent illness and reduce
the burden on hospitals.
If the government does
not pay for a vaccine,
I would consider it less of
a priority for my child
If I had to pay out of my
own pocket for a
vaccination to protect my
child, I would go ahead
and do so
0
10
20
30
40
50
60
70
% of Respondents
Strongly Agree
80
90
100
Strongly/Somewhat Agree
Source: Ipsos-Reid, “Childhood Vaccinations,” Health Check III 19, 5
(September/October 2004): pp. 37–43.
What’s In and What’s Out?
In 2002, the University of Toronto’s Medicare to Home and Community
Research Unit asked more than 2,500 health professionals and stakeholders
across Canada what health services should be publicly funded.27 A quarter
(25%) responded to the survey.
The majority of respondents (ranging from 82% to 90%, depending on
the health professional/stakeholder group) strongly supported the continuation of full public payment for insured hospital services, specifically acute
inpatient care, day surgery, diagnostic services and laboratory tests. There
was less support (ranging from 2% to 33%) for universal coverage of what
the researchers called “innovative” health services, such as genetic tests
(for example, prenatal screening or disease propensities in adults), elective
cosmetic surgery and complementary/alternative therapies. Support for
coverage of non-mandated services, such as immunizations, palliative care at
home, telephone-based advice from doctors and emergent ambulance
transport ranged from 59% to 89%.
27
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
For More Information
1. University of Montreal, Auton (Guardian ad litem of) v. British Columbia
(Attorney General), [online], last modified 2004, cited February 1, 2005,
from http://www.lexum.umontreal.ca/csc-scc/en/pub/2004/vol3/html/
2004scr3_0657.html.
2. Supreme Court of Canada, Chaoulli v. Quebec (Attorney General), Docket
29272, [online], last modified 2005, cited July 19, 2005, from <http://www.
lexum.umontreal.ca/csc-scc/cgi-bin/disp.pl/en/rec/html/2005scc035.wpd.html>.
3. H. Chodos and J. J. MacLeod, “Romanow and Kirby on the Public/Private
Divide in Healthcare: Demystifying the Debate,” Healthcare Papers 4, 4
(2004): pp. 10–25.
4. Health Canada, Canada Health Act—Introduction, [online], last modified
2004, cited August 10, 2004, from <http://www.hc-sc.gc.ca/medicare/
home.htm>.
5. Government of Canada, 1957—Advent of Medicare in Canada: Establishing
Public Medical Care Access, [online], last modified 2005, cited July 7, 2005,
from <http://canaidaneconomy.gc.ca/english/economy/1957medicare.html>.
6. R. Sheppard, “Managing Health Care a Challenge,” [online], last modified
December 9, 2002, cited March 3, 2005, from <http://66.59.133.172/index.
cfm?PgNm=TCE&Params=M2ARTM0012422>.
7. Minister of Health, Canada Health Act Annual Report 2002–2003, [online],
last modified 2003, cited June 21, 2005, from <http://www.hc-sc.gc.ca/
medicare/Documents/CHA0203.pdf>.
8. Health Canada, Canada Health Act Overview, [online], last modified 2005,
cited April 27, 2005, from <http://www.hc-sc.gc.ca/english/media/releases/
2002/health_actoverview.htm>.
28
9. Health Canada, 2003 First Ministers’ Accord on Health Care Renewal,
[online], last modified February 5, 2003, cited April 11, 2005, from
<http://www.hc-sc.gc.ca/english/hca2003/accord.html>.
10. Commission on the Future of Health Care in Canada, Building on Values:
The Future of Health Care in Canada (Final Report) (Ottawa: Commission on
the Future of Health Care in Canada, 2002), [online], cited July 15, 2005,
from <http://www.hc-sc.gc.ca/english/care/romanow/index1.html>.
The Canadian Reality
11. Commission on the Future of Health Care in Canada, Sustainability of
Canada’s Healthcare System—Issue/Survey Paper, [online], last modified
2002, cited July 11, 2005, from <http://www.chsrf.ca/other_documents/
romanow/pdf/sustain_e.pdf>.
12. Office Consolidation, Canada Health Act, [online], last modified 2005, cited
February 15, 2005, from <http://www.hc-gc.ca/medicare/Documents/Cb.pdf>.
13. Commission on the Future of Health Care in Canada, Medically Necessary:
What Is It, and Who Decides?, [online], last modified 2002, cited January 26,
2005, from <http://www.hc-sc.gc.ca/english/pdf/romanow/pdfs/
Medically_Nec_eng.pdf>.
14. J. Hoey, “Time for a New Canada Health Act,” Canadian Medical Association
Journal 163, 6 (2000): p. 689.
15. O. Madore, The Canada Health Act: Overview and Options (Ottawa:
Parliamentary Research Branch, 2004), pp. 1–23, [online] cited August 23,
2005, from <http://www.parl.gc.ca/information/library/PRBpubs/944-e.pdf>.
16. Health Canada, Canada Health Act—Overview, [online], last modified 2004,
cited March 1, 2005, from <http://ww.hc-sc.gc.ca/medicare/chaover.htm>.
17. R. B.Deber, Getting What We Pay For: Myths and Realities About Financing
Canada’s Health Care System, [online], last modified 2002, cited November
12, 2004, from <http://www.pnhp.org/docs/atrevised3.pdf>.
18. Canadian Diabetes Association, Diabetes Progress Report 2003: Provincial,
Territorial and Federal Policy and Programs for People With Diabetes,
[online], last modified 2005, cited December 13, 2004, from <www.
diabetes.ca/Files/ProgressReport2003.pdf>.
19. M. Stabile and C. Ward, “The Effects of De-Listing Publicly Funded Health
Care Services,” (forthcoming).
20. The Standing Senate Committee on Social Affairs,Science and Technology
The Health of Canadians—The Federal Role: Interim Report (Ottawa:
Government of Canada, 2002), [online], cited July 5, 2005, from
<http://www.parl.gc.ca/37/1/parlbus/commbus/senate/com-e/soci-e/
rep-e/repapr02vol05-5.htm>.
29
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
21. M. Giacomini, J. Hurley and G. Stoddart, “The Many Meanings of Deinsuring
a Health Service: The Case of in Vitro Fertilization in Ontario,” Social
Science & Medicine 50, 10 (2000): pp. 1485–500.
22. M. M. Rachlis, “Defining Basic Services and De-Insuring the Rest: The
Wrong Diagnosis and the Wrong Prescription,” Canadian Medical
Association Journal 152, 9 (1995): pp. 1401–95.
23. The Standing Senate Committee on Social Affairs, Science and Technology
The Health of Canadians—The Federal Role Volume Six: Recommendations
for Reform (Ottawa: Government of Canada, 2002).
24. Pollara, Health Care in Canada Survey 2004, [online], cited February 21,
2004, from <www.hcic-sssc.ca>.
25. C. Charles, J. Lomas and M. Giacomini, “Medical Necessity in Canadian
Health Policy: Four Meanings and . . . a Funeral?,” The Milbank Quarterly 75,
3 (1997): pp. 365–91.
26. Government of Ontario, Changes to Ministry of Health Schedule of Benefits
for Physicians’ Services Effective April 1,1998, [online], last modified 1998,
cited December 21, 2004, from <www.health.gov.on.ca/english/provider/
program/ohip/bulletins/4000/bul4306.html>.
27. R. B. Deber, E. Berger, A. P. Williams and B. Gamble, “What’s In, What’s
Out”: Stakeholders’ Views About the Boundaries of Medicare (Report on
the Results for Question 1), [online], last modified 2002, cited July 18, 2005,
from <http://www2.m-thac.org/cgi-bin/WebObjects/mthac.woa/wa/DetailDirect/
researchTraining?id=1000002>.
28. Office of the Prime Minister, A 10-Year Plan to Strengthen Health Care,
(news release), [online], last modified October 21, 2004, cited January 28,
2005, from <http://www.pm.gc.ca/eng/news.asp?category=1&id=260>.
30
3
A Primer on Canada’s
Health Care System—
What It Costs
Have you ever prepared index cards or highlighted your text with key
facts when you studied for exams? This chapter saves you the trouble.
We’ve assembled a set of key tables and graphs that offer highlights of
health care financing in Canada. For more information, including results
by province or territory, please consult the detailed tables in the Appendix.
31
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Health Spending Trends in Canada
11 Total Health Spending ($ Billions)
• Growth in total expenditure on
health care has outpaced inflation
for most of the last 30 years.
• Between 1975 and 2004,
inflation-adjusted health
spending increased by 179%.
140
($’ Billions)
120
• In 2004, Canada spent an
estimated $130 billion on
health care, or $4,078 per
person (forecast).
100
80
60
40
20
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003*
2004*
0
Actual Spending
Inflation-Adjusted Spending
Note: Data for 2003 and 2004 are forecasts.
Source: National Health Expenditure Database, CIHI.
• Between 1984 and 1994, population growth and inflation accounted
for almost 72% of total growth in
health spending. Together, they
explain 60% of the increase
between 1984 and 2004.
32
• The purchase of more or different
health services per person (net of
other factors), as well as the introduction of new technologies and
services, also accounted for part
of the growth in health spending
over the past two decades.
12 Components of Growth in Health Spending ($ Billions)
140
120
($’ Billions)
• Health spending increases can be
partially explained by population
growth and inflation.
100
80
60
40
20
0
1984
Health Spending in 1984
Increase Explained by Inflation
1994
2004
Increase Explained by Population Growth
Real Increase in Health Spending
Note: Data for 2004 are forecast.
Source: National Health Expenditure Database, CIHI.
A Primer on Canada’s Health Care System—What It Costs
13 Total Health Spending as a Proportion of GDP
• Trends in health spending as a
proportion of the gross domestic
product (GDP) reflect changes
in both health spending and the
total market value of all goods and
services produced within a country. In Canada, this ratio increased
significantly during the early 1980s
and again in the early 1990s,
peaking at 10% of GDP in 1992.
12
10
% of GDP
8
• A dip in the mid-1990s was
followed by steady increases.
Health spending surpassed
10% of GDP in 2003 and 2004.
6
4
2
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003*
2004*
0
Note: Data for 2003 and 2004 are forecasts.
Source: National Health Expenditure Database, CIHI.
• Health spending as a proportion
of GDP varies internationally—
from almost 6% in South Korea to
15% in the U.S.—among selected
Organisation for Economic
Co-operation and Development
(OECD) countries.
• Canada ranks in the middle third
among OECD countries, with
health spending representing
approximately 10% of GDP in
2003. This is similar to ratios
in the Netherlands and France.
14 International Comparison of Health Spending
as a Percentage of GDP in 2003
U.S.
Switzerland†
Germany
France†
Canada†
The Netherlands
Australia*
Denmark
Japan*†
Hungary*
UK*
South Korea
0
2
4
6
8
10
12
14
16
% of GDP
Note: *Data are for 2002. †Data are estimates.
The Organisation for Economic Co-operation and Development (OECD) asks member countries to report
health expenditures according to their system of health accounts. The 12 countries that most closely follow
the proposed system of health accounts are Australia, Canada, Denmark, France, Germany, Hungary, Japan,
South Korea, the Netherlands, Switzerland, the UK and the U.S.
Source: OECD Health Data 2005, OECD.
33
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Health Spending Compared
15 International Health Spending by Sector
• Public-sector health spending
as a proportion of GDP is larger
than private spending in most
of the comparison countries.
The exception to this is the U.S.,
where private-sector spending
represents 8% of GDP—compared
to that of the public sector, at less
than 7% of GDP.
60
10
9
50
8
% of GDP
7
40
6
30
5
4
20
3
2
10
1
Public Spending/GDP
Private Spending/GDP
• Private-sector health spending
as a proportion of total health
spending is the highest in the
U.S., at 55% of the total. Privatesector spending is the lowest
(proportionally) in the UK, at less
than 17% of total health spending.
In Canada, private-sector spending is approximately 30%
of total health spending.
U.S.
Switzerland†
Germany
France†
Canada †
The Netherlands
Australia*
Denmark
Japan (a)†
Hungary*
UK*
0
South Korea*
0
Private Spending as a % of Total Health Spending
and as a Percentage of GDP in 2003
Private Spending/Total Spending
Note: *Data are for 2002. †Data are estimates. (a) Data are for 2001.
The Organisation for Economic Co-operation and Development (OECD) asks member countries
to report health expenditures according to their system of health accounts. The 12 countries that
most closely follow the proposed system of health accounts are Australia, Canada, Denmark, France,
Germany, Hungary, Japan, South Korea, the Netherlands, Switzerland, the UK and the U.S.
Source: OECD Health Data 2005, OECD.
• In 2004, health spending per
person in the provinces ranged
from $3,667 in Quebec to $4,406
in Manitoba.
• Spending was significantly higher
in the territories. This is partly due
to low population density spread
over large geographic areas. For
example, in 2002, the Northwest
Territories spent approximately
$360 per person on ambulance
and other medical transportation,
while Alberta spent roughly $13
per person.
34
• All provinces and territories have
seen increases in health spending
per person of at least 160% since
1984. After adjustment is made
for inflation, increases range from
44% to 119%.
16 Health Spending per Person (1984 to 2004)
2004 Spending per Capita
Growth in Inflation-Adjusted
per Capita Spending Between 1984 and 2004
Canada
$4,078
61.4%
$5,469
114.1%
$3,970
44.3%
$6,833
65.9%
$4,253
118.7%
$8,751
---
$4,275
51.1%
$4,406
70.5%
$4,035
59.5%
$4,274
67.2%
$3,667
53.8%
$3,926
59.5%
$3,865
66.1%
$4,021
90.7%
Note: Data for 2004 are forecast. Figures are not adjusted for inflation.
Source: National Health Expenditure Database, CIHI.
A Primer on Canada’s Health Care System—What It Costs
17 Health Spending and Life Expectancy
90
• Per capita health spending varies
across OECD countries, with
some spending significantly
more than others. There is an
even larger variation globally.
Australia
France Germany
Life Expectancy (Years)
80
70
UK
Canada Denmark
• While countries spending very
small amounts on health services
per person tend to have lower
life expectancy, this relationship
does not always hold at all levels
of spending. For example, the
U.S. spends considerably more
than Canada per person, but
Canadians tend to live longer.
U.S.
60
50
40
30
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
Per Capita Health Spending (US$)
Notes: Expenditures are converted to U.S. dollars using purchasing power parities (PPPs) for gross
domestic product (GDP), which are designed to eliminate differences in price levels between countries.
The OECD asks that member countries report health expenditures according to their system of health
accounts. The 12 countries that most closely follow the proposed system of health accounts are Australia,
Canada, Denmark, France, Germany, Hungary, Japan, South Korea, the Netherlands, Switzerland, the UK
and the U.S. Life expectancy data are for 2002; health expenditure data are for 2001.
Source: World Health Organization, The World Health Report Statistical Annex.
• In Canada, health care is financed
by both the public sector and the
private sector. The public sector
is comprised of the provincial,
territorial and federal governments,
municipal governments and social
security funds. Private-sector
spending includes out-of-pocket
spending by individuals and private
insurance coverage.
• The National Health Expenditure
Database reports health spending
by responsibility for payment.
Therefore, federal transfers to provincial and territorial governments are
included in provincial and territorial
government health spending.
18 Who Spends What in Canada?
Total
Health
Expenditures
100%
PUBLIC
SECTOR
PRIVATE
SECTOR
69.7%
30.3%
Provincial
Government
Sector
Other
Public
Sector
63.8%
5.9%
NonConsumption
3.0%
Out-ofPocket
15.0%
Private
Health
Insurance
12.3%
35
Federal
Direct
Sector
Social
Security
Funds
Municipal
Government
Sector
3.8%
1.3%
0.8%
Note: Data are for 2002.
Source: National Health Expenditure Database, CIHI.
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
The Public/Private Financing Split
Health Spending ($ Billions, Inflation-Adjusted)
19 Inflation-Adjusted Health Spending
• Between 1975 and 2004, real
inflation-adjusted public-sector
health spending increased by
3.3% per year on average,
compared to 4.3% for privatesector spending.
90
• The relative amounts of public
and private health financing
shifted after the period of
government fiscal restraint during
the mid-1990s. Inflation-adjusted
public spending per person on
health declined by 2% between
1992 and 1996, while privatesector health spending grew by
almost 14% over this period.
80
70
60
50
40
30
20
10
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003*
2004*
0
Public-Sector Spending
• From 1997 to 2004, publicsector spending increased on
average 4.9% annually. Privatesector spending over the same
period increased on average
5.4% per year.
Private Sector Spending
Note: Data for 2003 and 2004 are forecasts.
Source: National Health Expenditure Database, CIHI.
• In Canada, out-of-pocket payments
represent half of total private
health spending. Among selected
OECD countries, this proportion
varies from 25% in the U.S. to
93% in Japan and Denmark
20 International Private-Sector Spending
3,500
3,000
2,500
(U.S.$)
• Private health spending is
financed primarily through outof-pocket payments and private
health insurance.
2,000
1,500
1,000
500
Out-of-Pocket
Other Private
U.S.
Switzerland
Germany
France
Canada
Denmark
Japan*
36
Hungary*
0
Private Insurance
Notes: Expenditures are converted to U.S. dollars using purchasing power parities (PPPs) for gross
domestic product (GDP), which are designed to eliminate differences in price levels between countries.
The OECD asks that member countries report health expenditures according to their system of health
accounts. The 12 countries that most closely follow the proposed system of health accounts are Australia,
Canada, Denmark, France, Germany, Hungary, Japan, South Korea, the Netherlands, Switzerland, the UK
and the U.S.
*Data are for 2002. Data for Australia and the UK were not available.
Source: OECD Health Data 2005.
A Primer on Canada’s Health Care System—What It Costs
21 Private-Sector Spending in Canada for 2002
(in $’ Millions)
Hospital Accommodation
Other Institutions*
Out-ofPocket
Spending
Insurance
$579.3
$867.6
$2,973.4
Physician Care
Non-Consumption
$1,379.7
N/R
Total
$2,826.5
N/A
$2,973.4
$257.3
$2.4
N/A
$259.8
Other Professionals
Dental Care
Vision Care
Other
$3,389.2
$1,951.5
$860.3
$4,441.3
$607.6
$643.3
N/A
$7,830.5
$2,559.2
$1,503.5
Drugs
Prescribed Drugs
Over-the-Counter Drugs
Personal Health Supplies
$2,934.1
$1,885.2
$1,710.2
$5,004.1
N/A
$7,938.2
$1,885.2
$1,710.2
N/A
N/A
$1,216.1
$1,216.1
Capital
Other Health Spending
Prepayment Administration
Health Research*
Other Health Care Goods
Other Health Care Services
Total Spending
$2,305.0
$74.6
$69.9
$17,136.5
$14,015.8
• Out-of-pocket spending
accounted for almost
half the $34.5 billion,
at $17.1 billion. Private
health insurance paid
for $14 billion, while
non-consumption expenditure made up the
remainder, approximately $3.4 billion.
$2,305.0
$754.4
$273.5
$467.1
$754.4
$198.9
$397.2
• Private-sector spending
for health care reached
$34.5 billion in 2002.
$3,350.2
$34,502.5
* Data cited for other institutions and health research are forecasts.
N/R = not reported
N/A = not applicable
Source: National Health Expenditure Database, CIHI.
22 Trends in Private-Sector Health Spending
• Spending by health insurance
companies increased by 51%
over the same period, at an
annual average increase of 11%.
• Total health spending grew at
an average annual rate of 8%
between 1998 and 2002.
18
16
14
12
($’ Billions)
• Between 1998 and 2002, out-ofpocket spending by Canadians
increased by almost 28%, an
average annual increase of
approximately 6.3%.
10
8
6
37
4
2
0
1998
1999
Out-of-Pocket
2000
2001
2002
Insurance
Source: National Health Expenditure Database, CIHI.
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
23 Public and Private Spending in 2004
Public Sector
Private Sector
Canada
$2,850
$1,228
$4,078
$4,322
$1,147
$5,469
$2,856
$1,114
$3,970
Total
$6,082
$752
$6,833
$3,359
$894
$4,253
$8,302
$449
$8,751
$3,026
$3,206
$1,249
$1,201
$4,275 $3,065 $4,406
$970
$4,035
$2,872
$1,401
$4,274
$2,591
$1,076
$3,667
$2,746
$1,180
$3,926
$2,730
$1,135
$3,865
$2,810
$1,211
$4,021
Note: Data for 2004 are forecast. Components may not sum to total due to rounding.
Source: National Health Expenditure Database, CIHI.
• Approximately 70% of health spending is provided by the public sector. However, the proportion varies
across Canada. For example, in Newfoundland and Labrador, the public sector paid $79 of every $100
spent per person on health. This compares to $67 spent in Ontario. In the territories, the public sector
pays for a significantly larger proportion of total health costs.
38
A Primer on Canada’s Health Care System—What It Costs
24 Shifts in Health Spending
Proportion of Total Health Spending by Category of Expenditure
1984
2004
24%
29%
43%
57%
19%
28%
Proportion of Public Health Spending by Category of Expenditure
1984
2004
25%
32%
6%
69%
57%
11%
• The distribution of how health
dollars are spent in Canada
has changed over time. In
2004, hospitals and physicians
represented 57% of publicsector health spending—down
from almost 70% in 1984.
• On the other hand, spending
on retail drugs rose over this
period—from 9% of total
health spending in 1984
to 16% in 2004. This shift is
evident in both public- and
private-sector spending.
• Private-sector spending on
hospitals (including insurance
and out-of-pocket spending)
covers items such as private
rooms, parking and donations.
For physicians’ services, it can
include check-ups mandated
by employers or insurance
companies and other noninsured services. In 2004,
hospitals and physicians’
services represented 9%
of private health spending—
down from 17% in 1984.
Proportion of Private Health Spending by Category of Expenditure
1984
2004
17%
21%
9%
23%
68%
62%
Hospitals and Physicians
Other Professionals and Drugs
Other Spending
Note: Data for 2004 are forecast.
Source: National Health Expenditure Database, CIHI.
39
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
25 Public-Sector Health Spending in the
• The way in which we spend
public-sector health care dollars
varies across the country. For
example, in 2004, Canada spent
39% of total public-sector health
dollars on hospitals. However,
this figure ranged from 25% in
the Yukon Territory to 48% in
New Brunswick.
Proportion of Public-Sector Health Spending (%)
Provinces and Territories in 2004
100
90
80
70
• Similarly, on average Canada
spent 9% of public-sector health
expenditures on retail prescribed
drug sales. However, this varied
among the provinces, from 6% in
P.E.I. to 12% in Quebec.
60
50
40
30
20
10
0
B.C. Alta. Sask. Man. Ont. Que. N.B. N.S. P.E.I. N.L. Y.T. N.W.T. Nun. Canada
Hospitals and Physicians
Other Professionals and Drugs
Other
Note: Data for 2004 are forecast.
Source: National Health Expenditure Database, CIHI.
26 Private-Sector Health Spending in the
Provinces and Territories in 2004
• In 2004, approximately 34% of
private-sector health spending went
to retail drug sales. This varied
from 24% in the Yukon to 49% in
Newfoundland and Labrador.
40
• In 2004, approximately 34% of
private-sector health spending
was spent on other health professionals. This varied from 20% in
Nunavut to 42% in British Columbia.
100
Proportion of Private Health Spending (%)
• In 2004, approximately 8% of
private-sector health spending went
to hospitals. This varied among
the provinces and territories, from
4% in New Brunswick to 16%
in Manitoba.
90
80
70
60
50
40
30
20
10
0
B.C. Alta. Sask. Man. Ont. Que. N.B. N.S. P.E.I. N.L. Y.T. N.W.T. Nun. Canada
Hospitals and Physicians
Other Professionals and Drugs
Other
Note: Data for 2004 are forecast.
Source: National Health Expenditure Database, CIHI.
Canada’s Health System
Financing, Ownership and Delivery
es
Source: Adapted from I. McKillop, J. Alpenberg,
R. G. Evans, et al., Private Sector Delivery: Scope
and Extent in Canada’s Health Care System,
(Waterloo: University of Waterloo, 2004).
Hospitals
Public
Ownership/Operation
S
Private P
ub
l
liv
De
of
ic
y
er
Hospital
Services
Pr
iva
te
ic
v
er
4
Public
Private
Source of Funding
Quick Facts
Use
• 8% of Canadian teens and adults were hospitalized in 2003; this
rate has been stable since 1994–1995.
Coverage
• Medically necessary services provided in hospitals are covered by
provincial and territorial health insurance plans.
• Other areas of hospital spending, such as patient accommodation
and capital investment, are paid for by a combination of sources,
including the public sector, individuals, private insurance companies, donations, investment revenue and other sources.
Spending
• In 2004, Canada spent $39 billion on hospital care, about 30% of
total health spending.
• 86% or more of funding for hospitals has been provided by the
public sector since 1994; the national figure is currently at 92%
(forecast for 2004).
41
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Watching the American television series “ER” or “House,” one might think that
hospitals mostly provide emergency care and major surgery. These services are
an important part of what Canada’s hospitals do. In 2002–2003, Canada’s 744
active hospitals had more than 14 million emergency department visits and
admitted almost 3 million patients. But most also have a large number of medical beds to provide non-surgical diagnostic and treatment services, such as
medical imaging, day surgery and clinics. Some hospitals also have separate
groups of beds, wings or buildings for long-term care.
Hospitals have traditionally taken the largest single slice of health care
dollars. In 2004, they spent a record $39 billion (forecast). That’s about $1,200
per Canadian. To put this in historical perspective, hospital spending first
passed $800 per person in 1989 and $1,000 in 2001. Except for a few years
in the mid-1990s, hospital spending per capita (not adjusted for inflation) has
grown steadily since the mid-1970s.
In spite of these increases, hospitals’ share of total health dollars has fallen
steadily over time due to higher spending growth for other types of care. Hospitals
accounted for 45% of the total in 1975, falling to 36% by 1994. Today, their costs
add up to roughly 30% of all health care spending. Among the provinces, hospital
care accounted for between 26% (Saskatchewan) and 35% (New Brunswick) of
total health care expenditure in 2004.
27 The Paradox of Hospital Spending
Hospital spending continues to rise, but other major areas of health care
expenditure are growing more quickly. As a result, hospitals account for a
smaller proportion of total health spending. The graph below shows the
percentage of total health care spending on hospitals between 1975 and
2004. Note that percentages for 2003 and 2004 are forecasts.
42
Percentage of Total Health Expenditures
50
45
40
35
30
25
20
15
10
5
0
1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003
Source: National Health Expenditure Database, CIHI.
Hospital Services
Hospital Services and Health Regions
Almost all hospitals in Canada are not-for-profit institutions.
Governments, regional health authorities and religious
organizations own most of our hospitals.
In most parts of the country, hospitals are now part of—or
funded through—regional health authorities. Quebec was the
first province to regionalize its health care system.1 Others
followed, but organizational models differ in size, structure
and scope of responsibility and continue to evolve. In the
spring of 2005, Ontario—the last province to regionalize its
health care system—established 14 Local Health Integration
Networks (LHINs). According to the Ontario Ministry of
Health and Long-Term Care, LHINs will “plan, co-ordinate,
integrate, and fund the delivery of health services at the
community level.”2 They will not replace existing boards in
programs and facilities or directly provide services themselves. At about the same time, Prince Edward Island moved
in the opposite direction, returning regional health authority
functions to the provincial department of health.
Other provinces have also recently restructured the administration of their health systems. In December 2003, for example, Quebec adopted a law laying out a plan to create a new
organizational structure in each of the province’s 18 health
regions by providing multidisciplinary care through local
integrated networks. In June 2004, the province created 95
networks. At the heart of these new networks are centres
for health and social services, called “centres de santé et
de services sociaux.”1, 3 Newfoundland and Labrador also
recently changed its regional structures, replacing 14 health
and community service boards with four Regional Integrated
Health Authorities. Previously, there were separate boards
for institutional and community services. The new boards
(whose mandates may be the broadest in Canada) will be
responsible for a wide range of services, including medical
clinics, health promotion and prevention, youth and family
services, community corrections, public health, cancer care,
mental health, hospitals and residential care programs and
health care premiums.4
Who Uses Canada’s
Hospitals?
According to Statistics Canada,
roughly 8% of Canadian teens
and adults reported being hospitalized in the previous year in
2003, a percentage that has
remained constant since 1994–
1995.5 In 2003, 10% of women
aged 12 or older said that they
were hospitalized in the past year,
compared to 6% of men. Childbirth partly accounts for the differences in hospital use by men
and women.
Overnight hospital stays have
become less common in recent
years. Between 1994–1995 and
2002–2003, the number of
overnight stays in acute care
hospitals fell by 15%. Bed counts
are also shrinking. Between
1999–2000 and 2002–2003,
the number of beds in general
acute care, rehabilitation and
psychiatric hospitals fell by
3%, 6% and 24% respectively.
While inpatient hospitalization rates are down overall, that’s
not the case for all types of care.
For example, more patients than ever before are now having hip and knee
replacements, open heart surgery and some types of cancer surgery. Circulatory
diseases (15%), pregnancy and childbirth (14%) and respiratory diseases (11%)
were the three leading causes of inpatient hospitalization in acute care facilities in
2002–2003.
43
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Day surgery programs are also taking more and more of the load. For example, hernia repair used to mean several days in hospital. Now, most patients go
home within 24 hours. The number of day surgery cases grew by 28% between
1995–1996 and 2002–2003.6 In some parts of the country, about half of all
operations are now done in day surgery.
Where Does a Hospital’s Money Go?
Health care is all about people—those who need care and those who provide it.
Not surprisingly, the bulk of hospital spending goes towards staff salaries and
benefits. They accounted for $21 billion in 2001–2002. That’s about 68% of total
hospital spending. Hospitals also spent $1.5 billion on physician compensation,
$1.3 billion on drugs and $6.9 billion on other supplies (medical and non-medical)
and sundries.
The biggest
28
spenders among
hospital departments are those that
provide direct patient
care. In 2001–2002,
inpatient nursing services (30%) and diagnostic and therapeutic
services (20%) alone
accounted for half of
all spending. Add to
this 6% for operating
rooms and 12% for
emergency and
ambulatory care.
Support services—
such as maintenance,
laundry and food
services—took another
17% of the total, down
from 20% in 1996–1997.
How Has Hospital Spending Changed?
Hospital costs shift over time, both between departments and in terms of how money
is spent. The table below shows how much the various areas in Canada’s hospitals spent
on staff salaries, physician compensation and drugs in 2001–2002. It also highlights how
expenditures have changed since 1996–1997 (not adjusted for inflation). Note that changes
in physician payment may partially reflect the introduction of alternative payment plans.
Salaries
Functional Centre
Physician
Compensation
Drugs
2001–2002
% Change
2001–2002
% Change
Spending
From
Spending
From
(in Millions) 1996–1997 to (in Millions) 1996–1997 to
2001–2002
2001–2002
2001–2002
Spending
(in Millions)
% Change
From
1996–1997 to
2001–2002
Administration and Support*
4,113
26
83
38
7
18
Inpatient Nursing**
6,793
40
334
183
390
60
Operating Room***
727
10
20
80
85
38
Emergency
963
92
176
336
75
131
Ambulatory Care
1,244
59
201
255
253
58
Diagnostic and Therapeutic
3,279
36
647
39
292
30
Research and Education
422
33
56
-25
0.3
-89
All Other
294
-9
16
102
139
161
18,091
38
1,551
85
1,337
70
TOTAL
Note: All numbers are rounded to the nearest million or percentage.
44
* Includes spending in such areas as human resources, communications and finance. Support includes materiel management, housekeeping services, plant maintenance and operation, among others.
** Includes ambulatory care clients for facilities without ambulatory care functional centres and expenses for physicians
contracted in specific inpatient nursing units.
*** Units used for surgical interventions, including post-anaesthetic recovery rooms.
Source: Annual Return of Health Care Facilities-Hospitals, Statistics Canada.
Hospital Services
29 Paying to Operate Health Technologies
The figure below shows the percentage distribution of operating revenue by source for
selected types of medical imaging equipment and total number of machines installed
in hospitals and free-standing imaging facilities in Canada, as of January 1, 2004
Hospital-Based
Equipment
Sources of Operating Funds
Free-Standing
Facilities
CT
MRI
CT
MRI
93.1%
87.4%
20.0%
5.0%
Workers’ Compensation Boards
0.3%
0.8%
1.5%
1.3%
Private Health Insurance, Other
Private Insurance, Out-of-Pocket Payments
0.3%
1.3%
58.5%
73.8%
Other Types of Funding
6.3%
10.5%
20.0%
20.0%
286
103
Provincial and Territorial Governments
Total Number of Machines
10
20
Note: Data pertains only to facilities reporting sources of funds.
Paying for Diagnostic Imaging
The ability to look inside the body using medical
imaging is essential to modern medical care. Buying
the machines can be costly, and operating expenses
also add up. In 2002–2003, hospitals spent $2.1 billion,
or 5% of their budgets, on these costs. The bulk
(65%, or $1.3 billion) went to pay physicians and
other staff. Supplies accounted for another 21%.
Where does this money come from? Provincial and
territorial governments paid the vast majority of the
operating expenses for MRI and CT scans in hospitals
in 2004. Insurance and out-of-pocket payments
accounted for less than 2% of revenue. The relative
shares are reversed in freestanding imaging facilities.
There, the provinces and territories paid 5 to 20%
of operating costs, compared with 58 to 74% from
private health insurance and out-of-pocket sources.
Source: National Survey of Selected Medical
Imaging Equipment (2004), CIHI.
While a small part of the total,
hospital spending on community
services has grown most quickly
in recent years. This area includes
spending on primary care clinics
(such as walk-in clinics), crisis
intervention support (such as crisis
lines), home care (such as rehabilitative and palliative care) and similar
services. In 1996–1997, this category
accounted for $210 million, or 1% of
hospital spending. Five years later,
that figure had risen to almost $580
million (approximately 2%).
Source: Canadian Institute for Health Information, Medical
Imaging in Canada, 2004 (Ottawa: CIHI, 2004).
45
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
The Cost of Treating Patients
The bulk of hospital dollars are used to treat circulatory diseases, pregnancy and
childbirth, digestive diseases, musculoskeletal and connective tissue disorders
and respiratory diseases. However, when the cost per patient is considered, the
order changes. For example, mental health ranks fifth in total hospital expenditures, but these patients are among the most costly to treat on an individual basis.
30 Hospital Costs for Selected Patient Groups
Across patient groups, the average cost of a hospitalization tends to be highest
for patients with musculoskeletal and connective tissue diseases, and circulatory
diseases. However, even within these groups, costs can vary significantly. For
example, it costs many times as much to provide an adult heart transplant as to treat
someone with heart failure. Average costs for inpatient hospitalizations in acute care
facilities are compared below for 2002–2003.
8,000
7,000
Cost per Patient ($)
6,000
5,000
4,000
3,000
2,000
1,000
-
B.C.
Alta.
Sask.
Man.
Ont.
Musculoskeletal and Connective Tissue Diseases
Respiratory Diseases
Pregnancy and Childbirth
N.B.
N.S.
P.E.I.
N.L.
All Provinces
Circulatory Diseases
Digestive Diseases
Notes: Comparable (representative) data not available for Quebec, the territories and Nunavut. Only typical patients were
included in the analysis of acute care inpatient records; stillbirths and cadaveric donors are excluded.
Source: Canadian MIS Database, Discharge Abstract Database, CIHI.
46
Hospital Services
Did You Know?
In 2002–2003, the average cost per inpatient visit in an acute care
hospital was roughly $5,100. Rehabilitation facilities and psychiatric
hospitals tend to have longer average lengths of stay. They also
have higher average costs per patient—approximately $16,870 and
$38,120 respectively.
Within acute care hospitals, costs vary substantially by type of
care. The table below shows average costs in 2002–2003 for typical
adult patients who have a selection of health problems and/or treatments, but no associated conditions that would make their care
more complex.
Patient Group
Average Cost
per Patient ($)
Bone marrow transplant
36,804
Non-extensive burns with skin graft
14,874
Multisystemic or unspecified
site infections with surgery
13,550
Extensive procedures for injury
or complication of treatment
11,673
Major intestinal and rectal procedures
8,650
Schizophrenia and other psychotic
disorders w/o ECT or Axis III diagnosis
8,460
Intracranial procedures with femur
procedures for trauma
8,383
Knee replacement
8,002
Specific cerebrovascular disorders except
transient ischemic attacks
5,520
Reconstructive ear, nose and throat procedures
5,429
Heart failure
4,060
Skin graft and wound debridement
for dermatologic disease (except ulcer or cellulitis)
3,926
Simple pneumonia and pleurisy
3,616
Penis procedures
3,320
Major gynecological procedures for ovarian or adnexal malignancy
3,197
Red blood cell disorders
3,000
Nutritional and miscellaneous metabolic disorders
2,766
Vaginal delivery
2,636
Transurethral prostatectomy
2,590
Laparoscopic cholecystectomy
2,585
Retinal procedures
2,538
Neonates weight >2,500 grams (normal newborn)
793
Notes: Comparable (representative) data was not available for Quebec, the territories and
Nunavut. Only typical patients were included in the analysis of acute care inpatient records;
stillbirths and cadaveric donors are excluded.
Source: Canadian MIS Database, Discharge Abstract Database, CIHI.
Who Pays for
Hospital Care?
The public sector pays for most
hospital care in Canada (93%
in 2004). This is the case in
some, but not all, OECD
countries. In 2000, for example,
the public share for curative
and rehabilitative inpatient care
was lowest in the United States,
at 59%. This result is different
from other OECD countries.
Among other countries
reporting data, the public
share ranged from 72% in
Switzerland to 95% in Denmark.
Interestingly, hospital services
are a case where private
financing and private delivery
do not always go hand-in-hand.
France, for instance, has more
privately provided hospital care
than Canada, but its public
share of spending (91.6%) was
about the same as ours (91.9%)
in 2000.7
47
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
In most parts of the country, health regions receive funds from government
and distribute them among the mix of services for which they are responsible.
A team of researchers found that governments usually fund hospital services
based on some combination of the following:
• who is served (for example, the proportion of seniors in an area) or
what types of services are provided (for example, the number of hip
replacements performed);
• how much the hospital spent
in the past, either overall or for
particular types of costs; and
• criteria related to the government’s political platform and
the needs of constituents as
identified by elected members
of the legislature (for example,
special funding for priority
programs).8
48
A Helping Hand
Some choose to donate their money; others give their
time. Volunteers are an important resource for hospitals. In 2000, Canadians volunteered 97 million hours
in hospitals and other health organizations, up from
93 million hours in 1997. That’s the equivalent of more
than 49,000 full-time jobs. Statistics Canada estimates
that if the health sector had had to pay for this work,
it would have cost about $1.3 billion.
Even more Canadians provide care or support to
the sick or elderly on their own (not through a formal
organization). According to Statistics Canada, about
6.8 million adults said that they did so in 2000—many
more than the number that work in the health sector.
Of this total, almost 2 million individuals said that
some or all of this care was provided to someone
recovering from a short-term illness after being
discharged early from a hospital.10
Hospital Services
31 Public and Private Spending on Hospitals
Hospital spending per person has grown steadily in recent years. Public-sector spending
has increased across the board, but private-sector trends are mixed. The figure below
shows public-and private-sector hospital spending per person for each of the provinces
and territories in 1994 and 2004 (not adjusted for inflation).
3,500
Total per Capita Spending ($)
3,000
2,500
2,000
1,500
1,000
B.C.
Alta.
Sask.
Man.
Ont.
Que.
N.B.
Public Sector
N.S.
P.E.I.
N.L.
Y.T.
2004
1994
2004
1994
2004
1994
2004
1994
2004
1994
2004
1994
2004
1994
2004
1994
2004
1994
2004
1994
2004
1994
2004
1994
2004
1994
2004
0
1994
500
N.W.T. Nun. Canada
Private Sector
Note: Data for 2004 are forecasts. Comparable data for 1994 for Nunavut and the Northwest Territories are not available.
Source: National Health Expenditure Database, CIHI.
In total, Canadian hospitals received about $3.1 billion from sources other than the
public sector in 2004, up from $2.7 billion a decade ago. In 2002, individuals and
private insurance firms paid about half of that amount to cover charges for private
rooms and other preferred accommodation, care for non-residents, chronic care and
uninsured services. (Almost 15 million Canadians aged 12 and over reported that
they had insurance that covered all or part of hospital charges for a private or semiprivate room in 2003.)9 Hospitals may also receive payments for some over-the-counter
drugs and personal health supplies, ancillary fees (such as parking and food services),
donations and investment income.
49
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
For More Information
1. Canadian Centre for Analysis of Regionalization and Health, About
Regionalization in Quebec, last modified 2005, [online], cited July 14, 2005,
from <http://www.regionalization.org/Regionalization/Reg_QC.html>.
2. Canadian Centre for Analysis of Regionalization and Health, About
Regionalization in Ontario, last modified 2005, [online], cited July 14, 2005,
from <http://www.regionalization.org/Regionalization/Reg_ON.html>.
3. Ministère de la Santé et Services sociaux du Québec, Création de 95
centres de santé et de services sociaux (CSSS) au coeur des 95 réseaux
locaux de services de santé et de services sociaux (RLS), last modified
2005, [online], cited July 14, 2005, from <http://www.msss.gouv.qc.ca/
reseau/rls/>.
4. Canadian Centre for Analysis of Regionalization and Health, About
Regionalization in Newfoundland and Labrador, last modified 2005, [online],
cited July 4, 2005, from <http://www.regionalization.org/Regionalization/
Reg_NL.html>.
5. Statistics Canada, “Health Care Services—Recent Trends,” Health Reports
11, 3 (1999): pp. 91–109.
6. Canadian Institute for Health Information, Inpatient Hospitalizations Continue
to Decline, Same-Day Surgery Visits on the Rise (news release), last modified 2004 [online], cited July 12, 2005, from <http://secure.cihi.ca/cihiweb/
dispPage.jsp?cw_page=media_29oct2004_e>.
7. Organisation for Economic Co-operation and Development, OECD Health
Data, 2005 (CD-ROM), (OECD, 2005).
8. Canadian Institute for Health Information, Hospital Financial Management
Practices in Canada, 2000—Funding, Reporting and Performance Monitoring
(Ottawa: CIHI, 2000).
50
9. Statistics Canada, Data Dictionary, [online], last modified 2005, cited July
14, 2005, from <http://www.statcan.ca/cgi-bin/imdb/p2SV.pl?Function=get
Documentation&AC_Id=27504&AC_Version=2&ul=ul&lang=en&db=IMDB&
dbg=f&adm=8&dis=2>.
10. Statistics Canada, Satellite Account of Non-Profit Institutions and
Volunteering, 1997–1999 (Ottawa: Statistics Canada, 2004).
Canada’s Health System
Financing, Ownership and Delivery
Pr
iva
Physicians
Source: Adapted from I. McKillop, J. Alpenberg,
R. G. Evans, et al., Private Sector Delivery: Scope
and Extent in Canada’s Health Care System,
(Waterloo: University of Waterloo, 2004).
Hospitals
Public
Ownership/Operation
S
Private P
ub
l
liv
De
of
ic
y
er
Physician
Services
te
es
ic
v
er
5
Public
Private
Source of Funding
Quick Facts
Use
• More than 59,000 physicians were practising in Canada in 2003.
• Most Canadians (80%) report visiting a doctor each year. This
percentage has remained relatively unchanged since 1994–1995.
Coverage
• The Canada Health Act ensures that all medically necessary physician
services are funded by public health insurance plans.
Spending
• Since 1994, public funding for physicians in Canada has remained
above 98%.
• Average annual payments to physicians from public health insurance
plans vary across the country.
51
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Canadians’ Use of Physicians
A Visit to the Doctor . . .
At the end of 2003, there were more than
59,000 physicians working across the country,
with a near fifty-fifty split between family physicians and specialists. These doctors work in a
variety of settings, including private practices,
walk-in clinics, hospitals, community health centres and emergency rooms. Most Canadians
visit a doctor at least once a year.
Eight in ten Canadians visit a doctor each year, a
rate that has remained relatively unchanged since
1994–1995.
Most (86%) people aged 12 or older reported
that they had a regular doctor in 2003. That
leaves another 2 million people (9%) who had
not looked for a regular doctor, and 1.2 million
who could not find one. In the 2001 National
Family Physician Workforce Survey, only
one-quarter (24%) of family doctors said that
they were accepting new patients. Among this
group, most said that their practices were
conditionally open. This means that they were
accepting new patients only under certain
circumstances (for example, referrals from
other physicians).
Patients do not have to pay directly for
most of the care they receive from doctors.
Physicians bill provincial or territorial health
insurance plans for each insured patient
service that they provide. Each province or
territory establishes a fee schedule for physician services covered under its
health care plan. This type of payment practice is referred to as “fee-for-service”
billing. The amount that physicians in each province or territory are paid is
based primarily on this fee schedule, negotiated between governments and
medical associations. However, alternative payment plans have gained
popularity in Canada in recent years. These methods of physician payment
typically include salaries, benefits and capitation (see Physician Pay
Preferences on page 54).
Health Spending on Physicians
In 2004, Canada spent an estimated $130 billion on health care—about 10%
of the economy, or gross domestic product (GDP). This money was used to
purchase a variety of goods and services, including millions of physician visits,
immunizations and hospital stays.
52
Three categories—hospitals (30%), drugs (17%) and physician services
(13%)—account for the majority (60%) of health care costs. In 2004, physician
services made up the third-largest category of total health expenditures.
Spending on physician services increased to a forecast $16.8 billion in 2004—
up 4.8% from the year before. However, these costs increasingly take up a
smaller share of a growing pie. The proportion of total health care dollars
going to pay for physician services has decreased over the years, from 15%
of total spending on health in 1994 to 13% in 2004. Spending on prescription
and over-the-counter drugs and other pharmacy supplies has grown faster than
spending for physician services since 1997. As well, the growth in spending on
public health and administration, other professional services and capital projects
has outpaced spending increases for physician services in recent years.
Physician Services
The public sector plays a larger role in financing health care in Canada than
the private sector. In 2002, approximately $7 of every $10 spent on health care
came from public sources—mostly from provincial and territorial governments.
Since 1975, public-sector payment for physicians has been at above 98% of
total physician costs. The private share of physician services was approximately
1.7% in 2002. Households account for almost all private spending on physician
services not covered by public plans in some or all jurisdictions. Examples of
private physician services not covered by public plans in some or all jurisdictions
include over-the-phone prescription refills, employment-related physical
examinations and general doctors’ notes.
32 Public and Private Spending on Physicians per Capita
The figure below shows fluctuations in public and private per capita spending on
physicians’ services between 1994 and 2004. Public per capita spending has
increased within each province and territory, as well as in the country as a whole.
900
Total per Capita Spending ($)
800
700
600
500
400
300
200
0
1994
2004
1994
2004
1994
2004
1994
2004
1994
2004
1994
2004
1994
2004
1994
2004
1994
2004
1994
2004
1994
2004
1994
2004
1994
2004
1994
2004
100
B.C. Alta. Sask. Man. Ont.
Que. N.B.
Public
N.S. P.E.I. N.L.
Y.T. N.W.T. Nun. Canada
Private
Notes: Data for 2004 are forecasts. Figures are not adjusted for inflation. Data for 1994 for Nunavut and
the Northwest Territories are not available.
Source: National Health Expenditure Database, CIHI.
53
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
How Doctors Are Paid
Physicians’ incomes are affected by several factors, including province or territory
of work and types of services performed. Reimbursement methods used by
provinces and territories to pay physicians for their services fall under two main
categories: fee-for-service and alternative payments.
Fee-for-Service Payments
The majority of doctors in Canada get most of their income from fee-for-service
payments. In 2002–2003, 83% of physician payments (excluding physicians in
Nunavut and the Northwest Territories) were in the form of fee-for-service billing.
This number varied across the country, ranging from roughly 58% in
Newfoundland and Labrador to 92% in
the Yukon Territory and Alberta.
Physician Pay Preferences
Under the fee-for-service system,
physicians bill their provincial or territorial health insurance plan for each
insured patient service they provide.
The amount that they are paid is based
on a fee schedule, negotiated between
governments and medical associations.
Alternative Payments
Alternative payment plans include a
broad range of payment methods, such
as salary, capitation, sessional, per
diem or hourly, service contracts, incentives and premiums. Blended payments
are a combination of fee-for-service
payments and one or more alternative
payment methods. Although alternative
payment plans have gained popularity
in Canada in recent years, only 18% of
payments to physicians in 2002–2003
were received through alternative payment plans.
54
In 2004, 51% of physicians reported receiving
90% or more of their income from fee-forservice billing, a drop from 68% in 1990. As
well, only 28% of physicians surveyed in 2004
endorsed fee-for-service as the sole method
of payment, a drop from 50% in 1995. At the
same time, there was a reported increase in
the popularity of blended payments. Almost
half (48%) of those surveyed in 2004 endorsed
blended payments, up from 27% in 2001.
These results draw on data from two recent
surveys. In 2004, the College of Family
Physicians of Canada, the Canadian Medical
Association (CMA) and the Royal College of
Physicians and Surgeons of Canada collaborated for the first time on the National Physician
Survey (NPS). The results of the NPS are compared here with those of the CMA-administered
Physician Resource Questionnaires of 1990 and
2001, which are part of an ongoing series. All
respondents were asked about their current
compensation arrangement and preferred
methods of remuneration.
Results of the two surveys indicate that the most
preferred options for payment are fee-for-service
and salary, either individually or as part of a
blended plan. On the other hand, specialists
and family doctors show little support for
payment models based on capitation or
on service contracts.3
Physician Services
33 Alternative Payments to Physicians, 2000–2003
The popularity of fee-for-service remuneration for doctors has dropped over
time. The proportion of all clinical payments coming through alternative
payment plans has increased over time, but continues to vary across the
country. For example, between 2000–2001 and 2002–2003, this increase
ranged from 12% in New Brunswick to 211% in Alberta. The national average
increase was 38%.
2000–2001
2001–2002
Canada*
12.8%
16.4%
17.5%
2002–2003
32.3%
38.9%
42.2%
--4.7%
8.0%
12.5%
18.4%
19.3%
2.8%
6.8%
8.7%
16.4%
18.4%
26.7%
27.1%
34.2%
35.9%
8.5%
11.9%
11.1%
18.5%
20.8%
22.5%
18.1%
18.1%
25.0%
16.5%
18.0%
18.5%
27.9%
30.2%
31.6%
Source: Canadian Institute for Health Information, The Status of Alternative Payment Programs for
Physicians in Canada 2002–2003 and Preliminary Information for 2003–2004 (Ottawa: CIHI, 2004).
* National percentages exclude Nunavut and the Northwest Territories.
How Much Doctors Get Paid
How much doctors are paid can vary depending on the area of the
country they work in. For full-time family doctors, the average amount
received from fee-for- service billing ranged from $150,779 in Prince
Edward Island to $238,182 in Alberta. Full-time specialists received
average payments of $188,737 in Quebec to $322,204 in Alberta.
For all physicians in Canada (excluding Nunavut and the Northwest
Territories), the amount paid to full-time fee-for-service physicians
increased by 3.4% between 2001–2002 and 2002–2003.
55
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
The amount that doctors are paid also depends on the type of service they
provide. These services are categorized as either procedures or consultations and
visits with patients. For example, in 2002–2003, the average amount that a family
physician received for all visits and consultations from fee-for-service billings
ranged from $200,420 in Alberta to $105,264 in Prince Edward Island. For all
procedures performed in the same year, the amounts also ranged considerably—
from $32,150 in Alberta to $7,990 in Newfoundland and Labrador. Fee-for-service
payments to specialists for all visits and consultations varied from $152,436 per
doctor in Alberta to $103,106 in Newfoundland and Labrador. Likewise, the
variation in average payments to specialists for all procedures performed in
2002–2003 ranged from $165,347 in New Brunswick to $106,953 in Manitoba.
34 How Much Do Doctors Get Paid?
Full-time† specialists received higher average payments for their services
through provincial fee-for-service programs than did family physicians and
general practitioners in 2002–2003. In addition, average payments to both
specialists and family doctors varied significantly across Canada, depending
on where they practise.
†
For the purposes of payment calculations,
the term “full-time equivalent” (or “FTE”) is
used to describe doctors working full-time.
For more information, see CIHI’s Average
Payment per Physician Report, Canada,
2002–2003 and Full-Time Equivalent
Physicians Report, Canada, 2002–2003.
Average Payment ($, in Thousands)
350
300
250
200
150
100
50
0
B.C.
Alta.
Sask.
Man.
Ont.
Family Medicine
Que.
N.B.
N.S.
P.E.I.
N.L. Canada
All Specialists
Notes: Average annual payment figures are total amounts paid to individual physicians (gross amounts)
and exclude expenses or overhead costs incurred in their main practice settings. Medical and surgical
specialties are combined into one “specialist” category. Also note that the territories are excluded due to
lower volumes of reported services.
Source: Canadian Institute for Health Information, Average Payment
per Physician Report, Canada, 2002–2003 (Ottawa: CIHI, 2004).
56
Physician Services
35 Differences in Cost for Specialists and Family Doctors
Physicians receive payments through government fee-for-service insurance
plans for both consultations/visits and procedures. The balance between these
two types of payments differs for full-time and part-time FP/GPs and specialists.
It also varies across the country, as shown in the graph below.
Average Payment per Category ($)
350,000
300,000
250,000
200,000
150,000
100,000
B.C.
Alta.
Sask.
Man.
Ont.
Que.
Total Consultations and Visits
N.B.
N.S.
P.E.I.
N.L.
FP/GP
Specialists
FP/GP
Specialists
FP/GP
Specialists
FP/GP
Specialists
FP/GP
Specialists
FP/GP
Specialists
FP/GP
Specialists
FP/GP
Specialists
FP/GP
Specialists
FP/GP
Specialists
FP/GP
0
Specialists
50,000
All
Provinces
Total Procedures
Note: These figures represent full-time and part-time fee-for-service billing physicians, and are drawn from
the National Grouping System (NGS), developed by CIHI to facilitate comparisons among different provinces
and territories.
Source: Canadian Institute for Health Information, National Grouping System Categories Report, Canada,
2002–2003 (Ottawa: CIHI, 2005).
At the same time, as average payments are changing, so too are the
number and type of services provided by physicians. For example, the 2004
National Physician Survey found that 17% of physicians reported that they had
reduced their weekly work hours in the past two years, and 13% reported that
they had reduced their scope of practice over the same time period. Only
4% said that they had expanded their services. Looking ahead, 5% of family
physicians and 8% of specialists said that they planned to retire in the coming
two years.
57
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
36 A Look at Physician Income—FPs and GPs
58
Average Employment Income ($, in Thousands)
Costs associated with running a
practice affect the amount of
income a physician or specialist
gets to “take home.” These
overhead costs mean that
doctors’ overall incomes may
vary considerably from the
amount they bill for the services
they perform. Overhead costs,
including investments in office
equipment, supplies, rent, professional fees and staff salaries,
can be a significant amount.
A 2002 survey by the Canadian
Medical Association asked
physicians (specialists,
family doctors and general
practitioners) to estimate these
costs. Medical specialists
reported spending over
one-quarter (27%) of their
earnings on overhead costs.
Surgical specialists spent
one-third (33%) of their
income on overhead costs
and family/general physicians
spent 35%.6 Data from the
Census (see Figure 36)
provide a perspective on
physicians’ income (from
all sources) after these types
of costs are deducted.
Specialists
180
160
140
120
100
80
60
40
20
0
B.C.
Alta.
Sask.
Man.
Ont.
Que.
1995
N.B.
N.S.
N.L.
Canada
N.L.
Canada
2000
A Look at Physician Income—Specialists
Average Employment Income ($, in thousands)
Overhead Costs and
Physicians’ Incomes
The graphs below show the variation in annual employment income among
specialists, family physicians (FPs) and general practitioners (GPs) in 1995
and 2000. In all provinces except Manitoba, specialists earned more than
other physicians in 2000. However, the size of the income gap varied across
the country.
FPs and GPs
180
160
140
120
100
80
60
40
20
0
B.C.
Alta.
Sask.
Man.
Ont.
1995
Que.
N.B.
N.S.
2000
Note: Data for Prince Edward Island, Nunavut, the Yukon and the Northwest Territories were not available.
Source: Statistics Canada, Census 1996, 2001.
Physician Services
Private Spending on Physician Services
Payment for physician services comes primarily from the public sector (98%
since 1975). Physician services are a core service insured under the Canada
Health Act. This legislation facilitates “reasonable access” to medically necessary
insured services, without direct charges, but also outlines specific criteria and
conditions related to publicly insured
health care services.
Private Spending—The Rise of Plastic
Surgery in Canada
When we think of plastic we often tend to think of common objects like toys and household food containers.
However, the term “plastic” actually evolved from the
Greek word plastikos, which means to reconstruct,
form, or create. Not surprisingly then, plastic surgery
focuses on “the creation of new tissue, improvement
of form and function, and reconstruction following
accident or injury.”7
Plastic surgery has been cited as early as 800 B.C.,
when physicians in India performed reconstructive
work using skin grafts.8
Today it is used for both reconstructive and cosmetic
purposes. For example, burn victims may require
reconstructive skin grafts to treat severe burns, while
some individuals may choose cosmetic surgery to
change their physical appearance and to improve
their sense of well-being. Although some reconstructive surgery is covered by provincial and territorial
health insurance plans, cosmetic procedures are
generally paid for out-of-pocket.
In Canada, little information is available on cosmetic
surgery. In May 2004, Medicard Finance Inc.
(a finance company for medical procedures) and
researchers from the Rotman School of Business
at the University of Toronto surveyed a sample
of Canadian surgeons and cosmetic physicians to
find out more about these procedures. According
to their statistics, liposuction and breast augmentation
accounted for 24% and 17% respectively of all
cosmetic surgeries performed that year. Surgical
facelifts accounted for 2%. Women are the primary
recipients of plastic surgery; they accounted for
85% of all cosmetic procedures performed in 2003.
However, services that are not
covered by provincial or territorial
health insurance plans have to be paid
for by individuals out-of-pocket or by
their coverage under private health
insurance. Services that are not
covered by public insurance plans
are those that have become de-insured
(and are no longer listed on provincial
fee-for-service schedules) or others
deemed to be not medically necessary.
For example, cosmetic and plastic
surgery, in general, are not covered
under public insurance plans, except
for specific procedures involving burns
and reconstructive surgery performed
in a hospital.
59
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
For More Information
1. Statistics Canada, “Health Care Services--Recent Trends,” Health Reports
11, 3 (1999).
2. Statistics Canada, “Changes in Unmet Healthcare Needs,” Health Reports
13, 3 (2002).
3. B. Hutchison and G. Buckley, Preferences of Canadian Physicians for
Blended Payment Arrangements: Results From the Canadian Medical
Association’s Physician Resource Questionnaire, 2001–2003 (Montreal:
Centre for Health Economics and Policy Analysis, 2004).
4. T. Gosden, B. Sibbald, J. Williams, R. Petchey and B. Leese, “Paying
Doctors by Salary: A Controlled Study of General Practitioner Behaviour in
England,” Health Policy 64 (2003).
5. R. J. Sorenson and J. Grytten, “Service Production and Contract Choice in
Primary Physician Services,” Health Policy 66 (2003).
6. L. Buske, “Physician Billing Highest in Ontario, Lowest in Quebec,”
Canadian Medical Association Journal 170, 5 (March 2, 2004).
7. Canadian Society of Plastic Surgeons, President’s Message (2005), [online],
cited July 18, 2005, from <http://www.plasticsurgery.ca/presmsg.htm>.
8. American Society of Plastic Surgeons, The History of Plastic Surgery,
ASPS and PSEF (2005), [online], cited July 18, 2005, from <http://www.
plasticsurgery.org/History.cfm>.
60
Canada’s Health System
Financing, Ownership and Delivery
Pr
iva
Physicians
Retail Drug Sales
Source: Adapted from I. McKillop, J. Alpenberg,
R. G. Evans, et al., Private Sector Delivery:
Scope and Extent in Canada’s Health Care
System, (Waterloo: University of Waterloo, 2004).
Hospitals
Public
Ownership/Operation
D
S
Private P
ub
l
iv
el
of
ic
y
er
Retail Drug
Sales
te
es
ic
v
er
6
Public
Private
Source of Funding
Quick Facts
Use
• 56% of Canadian adults in 2002–2003 reported taking a
prescription medication in the previous month.
• Over 380 million prescriptions were filled in 2004, an increase of
74% over the past 10 years.
Coverage
• $8.5 billion was spent by the public sector on prescribed drugs in
2004 (forecast). The public sector’s share of total spending on
prescribed drugs has grown from 42% in 1984 to 47% in 2004.
• 79% of Canadians aged 12 or older reported having some public
and/or private drug insurance in 2003—up 18% points from
1996–1997. In 2003, rates ranged from 66% in Prince Edward
Island to 89% in Quebec.
Spending
• $13.3 billion was spent on retail drugs by the private sector in
2004. Of that total, $9.5 billion was spent on prescriptions. Out-ofpocket expenses for the remaining $3.8 billion paid for over-thecounter drugs and personal health supplies.
• 3% of households reported spending more than 5% of their aftertax income on prescription drugs in 2002.
61
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Taking medication is a part of everyday life for many Canadians. Medicine cabinets include a growing assortment of newer—and often expensive—drugs.1 How
we obtain and pay for drugs, as well as the amount that we pay, varies almost as
much as the effects that different drugs can have on our bodies.
Prescription and over-the-counter drugs help Canadians in many ways. They
can save lives, reduce the need for surgery and allow us to maintain or improve
our quality of life. In some cases new drugs—such as antibiotics and insulin—
revolutionize the treatment of a disease. But many medications in use today are
“halfway technologies”; they alleviate symptoms but do not cure or prevent the
underlying condition.2
While many medications offer significant benefits, using drugs inappropriately can lead to health risks and costs. For example, drugs can have serious
side effects, and some medications are harmful when combined with other
drugs or natural products. In addition, drugs are sometimes prescribed for
problems better managed in other ways. In some cases, new and more
expensive drugs are used in situations where older, less expensive products
would be equally effective. As well, mistakes can occur when drugs are prescribed or taken. Some people also abuse or misuse medications. In a study
in Atlantic Canada, for instance, 15% of adolescents who had been prescribed
stimulants told researchers that they had given their drugs to others; 7%
reported having sold them.3
Since 1997, spending on retail drugs has
been the second-largest category of health
expenditure in Canada. Although government
programs help to finance some of these costs,
the private sector still pays more than half of
the bill. This chapter explores how the utilization and financing of retail drug sales has
changed over time and how they compare
across Canada and with other countries.
62
Drug Spending in Hospitals
Retail drug sales account for the bulk of spending
in Canada, but hospital budgets also include significant—and growing—drug costs. In 2001–2002,
Canadian hospitals spent over $1.3 billion on
drugs, or about 4% of their operating budgets—
more than a fourfold increase over 20 years (not
adjusted for inflation). The proportion of hospital
budgets spent on drugs in 2002 ranged from
3.1% in Newfoundland and Labrador to 4.9%
in Alberta. Across the country, provincial and
territorial health insurance plans typically cover
these costs.
Retail Drug Sales
Medicating More
From aspirin to beta-blockers, we are consuming more medication than ever
before. In 2002–2003, a joint Canada/United States survey showed that over half
of Canadian (56%) and American (58%) adults reported taking a prescription medication in the previous month.4 In the last 10 years, the volume of prescriptions
dispensed to Canadians grew by over 70%.5
A recent study suggests that variation in the use of medications partly—
but by no means completely—explains why drug spending differs from province
to province.6 Other factors may include differences in the price of drugs, the use
of generic drugs, specific treatment choices and the mix of drugs that are prescribed. The study also showed that Quebec had the highest average per capita
spending on oral solid prescriptions in 2002 ($406). As well, it found that
Quebec residents used more medications on average, consumed a more
expensive mix of products and paid more per product unit. This compares
with residents of British Columbia ($274) and Saskatchewan ($269), who
purchased fewer drugs on average and tended to receive relatively low-cost
therapeutic alternatives.
37 Prescriptions Filled in Canada
In 2004, Canadian retail pharmacies filled more than 380 million prescriptions, an increase of 74% from a decade before. The most frequently filled
classes of drugs were cardiovasculars (15%), psychotherapeutics (12%),
hormones (6%) and antibiotics (6%). On average, Canadians filled 12
prescriptions per person in 2004. However, this amount increased with
age—adults aged 80 or older filled the greatest number of prescriptions
each, averaging 42 per person.
Number of Prescriptions Dispensed (Millions)
400
350
300
250
200
150
100
50
0
63
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
Source: IMS Health Canada, Growth in Retail Prescriptions Slows in 2004, [online], last modified
March 7, 2005, accessed July 12, 2005, from <http://www.imshealthcanada.com/htmen/4_2_1_54.htm>.
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Who Is Covered?
In Canada, both the public and private sectors pay
part of the drug bill. Public-sector payers include
governments, Workers’ Compensation Boards and
other social security schemes. The federal government pays for prescribed drugs for the military,
the Royal Canadian Mounted Police, veterans,
inmates in federal jails and Status Indians and Inuit.
Provincial and territorial governments pay for drugs
given to patients in hospitals across the country.
They also have a variety of programs that cover
parts of the total drug bill.
More than three-quarters of Canadians do not
have to pay the full cost of their prescribed drugs
out-of-pocket. In 2003, 79% of Canadians aged
12 or older reported that they had some public
and/or private drug insurance, according to a
Statistics Canada survey. That’s up from 61% in
1996–1997.7 Low-income Canadians, part-time workers and those without jobs are less likely than their
counterparts to say that they are insured. In part, this
likely reflects the fact that private insurance is often a
benefit of employment, covering employees and
their dependents.8
Statistics Canada measured coverage rates
among the provinces and territories and found that
they ranged from 67% in Prince Edward Island to
89% in Quebec. Researchers largely attribute this
to differences in public drug plans.9 In some cases,
experts suggest that these figures may be underestimates. They believe that respondents may not be
aware of coverage available to them or may not
interpret public drug coverage as “insurance.”8, 9
64
Each province and territory has developed its
own publicly funded drug plan(s). As a result, families with similar incomes and medical needs may
receive very different government-funded benefits,
depending on where they live. Persons receiving
social assistance are covered in all provinces and
territories, but program benefits vary.10
There’s More
Want to learn more about what’s covered
under provincial and territorial drug plans?
Check out CIHI’s Drug Expenditure in
Canada 1985 to 2004 report online at
www.cihi.ca.
Coverage for MS Drugs
Public drug plans vary significantly across
Canada. While there tends to be a common core, plans cover different drugs,
include different groups as eligible beneficiaries and require different levels and
types of patient cost sharing.11, 15 For
example, some drugs appear on all
provincial and territorial “formularies”
(lists of drugs eligible for reimbursement).
Others are covered only in selected
provinces and territories. The conditions
under which particular drugs are covered
also vary.
Take, for instance, the four drugs (Avonex,
Betaseron, Copaxone and Rebif) that have
become available for the treatment of multiple sclerosis (MS) in recent years. All
provinces and territories provide some
coverage for these MS drugs, although the
level of coverage differs across the country.
CIHI’s National Prescription Drug Utilization
Information System reports that eight
jurisdictions (British Columbia, Alberta,
Saskatchewan, Quebec, New Brunswick,
Prince Edward Island, Newfoundland and
Labrador and Yukon Territory) list MS
drugs as restricted benefit drugs. This
means that coverage is offered to patients
who meet pre-defined criteria (for example,
the diagnosis and/or the prescription is
written by a neurologist). In Manitoba, they
are listed as exceptional status drugs and
appropriateness of coverage must be
assessed by an MS clinic.
continued on next page
Retail Drug Sales
Coverage for MS Drugs continued from previous page
In Nova Scotia, the Dalhousie MS Research Unit
provides funding assistance based on established
clinical criteria when there is no other drug
coverage (for example, private insurance).
Beyond these parameters, the amount that is
covered by provincial and territorial programs
can vary, depending on family income. This is
the case in British Columbia, Saskatchewan,
New Brunswick and Prince Edward Island. In
Newfoundland and Labrador and the Yukon,
public coverage for drugs is available only for
persons on social assistance, seniors and persons
registered under the Yukon Territory Chronic
Disease Program. Ontario residents may request
special coverage if they are 65 years of age or
older, reside in a long-term care facility or Home
for Special Care, receive social assistance, receive
professional services under the Home Care
Program, or are Trillium Drug Program recipients.
38 Rising Drug Bill
% Change Between 1984 and 2004
Retail drug sales have increased across the country, but the rate of change
and distribution between the public and private sectors varies. The figure
below shows the percent change in prescribed drug expenditures per person
between 1984 and 2004 by province and territory (not adjusted for inflation).
1600
1400
1200
Most public plans require
clients to share part of the cost of
their drugs through deductibles
and/or copayments. These
requirements differ across the
country. For example, public
drug plans cover all residents of
Saskatchewan, British Columbia
and Manitoba, but residents
must pay relatively high deductibles.11, 13 Likewise, all residents without private insurance
are covered under public plans
in Quebec, but most Quebec
residents must pay a monthly
deductible and a premium based
on their monthly income.11, 13, 14
Why Is Drug
Spending Rising?
1000
800
600
400
200
0
Most government plans also
cover seniors (although coverage is based on income in
some provinces). Some government drug plans also cover persons with specific diseases—
such as HIV/AIDS, cancer and
diabetes—that often require
expensive drug therapy. The diseases that qualify for coverage
vary across the country.11, 12
B.C. Alta. Sask. Man. Ont.
Que.
Public Sector
N.B. N.S. P.E.I. N.L.
Private Sector
Y.T. N.W.T./ Canada
Nun.
Source: National Health Expenditure Database, CIHI.
In total, Canada spent $21.8 billion on retail drug sales in 2004,
83% of which went to prescribed
drugs. Spending first reached
$10 billion in 1995; it broke the
$20 billion level in 2003. In
recent years, spending on prescribed drugs has risen more
quickly than on over-the-counter
drugs and personal health supplies. Annual growth rates for the
former have been between 10%
65
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
and 15% in the past five years, compared with 2%
to 4% per year for non-prescribed drugs and personal health supplies.
A number of intersecting trends may
explain recent increases in drug spending.
Changes in the prices of drugs and in retail
and wholesale markups and professional
fees are some examples.16 However, the
Patented Medicines Prices Review Board
recently identified a number of other trends
affecting drug spending, including:
• Changes in population size
• Changes in population demographics
and health status
• More cases of health problems that can
benefit from drug therapy
• Changes in the prescribing patterns of
physicians (for example, shifts from older,
less expensive medication to newer, relatively
more expensive medications to treat the
same underlying condition)
• Emergence of new drug therapies to treat
previously untreatable conditions
• Greater propensity to use drugs to treat
conditions not previously considered
problematic.17
66
Which factor matters most? A study of prescriptions dispensed to seniors under British
Columbia’s Pharmacare Plan looked at reasons for the jump in average drug costs per
person.18 Spending per person rose from $49
to $136 between 1985 and 1999. The study
found that three major changes drove increases
over this period:
• Drug mix (40%): Different drugs were
prescribed within a category (for example,
switched drugs within a category, increased
doses or additional prescriptions for drugs
within a category).
Managing Costs
In Canada and other Organisation for Economic
Co-operation and Development (OECD) countries, governments face the difficult task of containing public spending on drugs while ensuring
that their residents have access to essential
medications regardless of their ability to pay.
To accomplish this task, public drug plans use
a variety of mechanisms to manage their drug
costs. (Private plans also face cost escalation
challenges. Some use similar management
options as to those employed by public plans.)
In many countries, copayments, deductibles and
premiums are widely used cost-sharing mechanisms. Although these mechanisms are intended
to promote the appropriate use of medication
and/or manage costs, in some cases they may
diminish access to needed medications among
those who are less able to pay.19 For example,
in 1996, the Quebec government legislated
mandatory drug coverage for those without private insurance. To help finance this expanded
coverage, it increased the amounts that residents
were required to pay through the use of
deductibles and premiums. Researchers found
that this new policy improved access to medications for uninsured people. However, seniors
and those on social assistance used fewer
“essential” drugs, experienced more serious
adverse events and had more visits to
emergency departments. 20, 21 As a result of these
findings, the Quebec government revised its
drug plan and eliminated payments from social
assistance recipients with severe employment
constraints and seniors receiving the maximum
Guaranteed Income Supplement. 14, 22, 23
Although controversial, reference-based pricing
is another mechanism used to manage costs
in some parts of the country. First introduced
by British Columbia in 1995, this is a process
whereby the public plan generally covers up to
the cost of “referenced” drugs among a category
of chemically different drugs that have the same
therapeutic effect. (A related “low-cost alternative” program ensures that the public plan pays
no more than the price of the
continued on next page
Retail Drug Sales
Managing Costs
continued from previous page
lowest-cost option among drugs with identical
active ingredients.) This program has been implemented for five drug classes in the province.24
In these cases, experts have judged that two
or more drugs can be used to treat the same
condition. These drugs may have different
chemical properties and are often sold at
different prices. British Columbia’s Pharmacare
program will pay only the cost of the reference
drug, unless there are medical reasons why
a patient cannot take it (such as allergies).
Research suggests that this program saves
money without increased hospital admissions
or mortality.25
Following B.C.’s lead, other jurisdictions have
considered similar types of programs, such as
Nova Scotia’s pricing of non-steroidal anti-inflammatory products (e.g. naproxen, ibuprofen, etc).26
In early 2005, Ontario began considering referencebased pricing for proton pump inhibitors.27
• Exposure across therapeutic categories
(38%): Seniors had prescriptions from
more categories of drugs (for example,
nonsteroidal anti-inflammatory agents or
benzodiazepines), on average.
• Drug prices (22%): Higher prices for
individual products, partially offset by the
substitution of lower-cost generic products
for brand name drugs.
Who Pays?
Paying for retail drug sales is a shared responsibility. In 2004, the public sector spent a
forecast $8.5 billion on prescribed drugs. This
took the public sector share to 47%, up from
42% in 1984. And it’s a growing share of a
growing pie. Over the past two decades, actual
39 Sharing the Cost
Governments, social security funds, private insurers and individuals share the
costs of prescribed drugs. In contrast, individual Canadians bear the bulk of
the costs for over-the-counter drugs and personal health supplies (such as
diabetic test strips). The figure below shows the share of spending on prescribed and non-prescribed drugs by the public and private sectors in 2002.
Public
(Prescribed
Drugs)
37.3%
Personal Health
Supplies
9.3%
Private
62.7%
Over-the-Counter
Drugs
10.2%
Prescribed Drugs
43.1%
Source: National Health Expenditure Database, CIHI.
67
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
spending on prescribed drugs has increased significantly. In 2004,
we spent a forecast $562 per person on prescribed drugs—more
than a fivefold increase since 1984 (not adjusted for inflation).
The private sector continues to pay for the majority of retail
drug sales—a total of $13.3 billion in 2004. Of that total, $9.5 billion
was spent on prescribed drugs. The remaining $3.8 billion was
spent on over-the-counter medications and personal health supplies and was paid for out-of-pocket by individual Canadians.
Some households pay more out-of-pocket than others. According
to Statistics Canada, 65% of households paid for some or all of the
cost of prescriptions in 2002. As well, 3% of households reported
spending more than 5% of their after-tax income on prescription
drugs provincially. This rate ranged from 1.6% in Ontario* to 8.1%
in Saskatchewan.28
40 Household Spending on Prescriptions
Canadian households spent an average of $268 out-of-pocket on prescription
drugs in 2003. Among the provinces, the average amount spent varied from
$200 in Ontario to $427 in Prince Edward Island. Residents in the territories
reported the lowest average out-of-pocket costs. The figure below shows the
range in average household spending on prescription drugs across the country.
450
Average Household Spending
on Prescriptions ($)
400
350
300
250
200
150
100
50
0
B.C. Alta. Sask. Man. Ont. Que. N.B. N.S. P.E.I. N.L. Y.T. N.W.T. Nun. Canada
68
Source: Survey of Household Spending, Statistics Canada, 2003.
* The percentage reported for Ontario has a coefficient of variation of 18.5 and should be interpreted
with caution.
Retail Drug Sales
An International Perspective
Drugs are an important part of modern medicine and account for a rising share
of health budgets around the world. In 2003, the most recent year for which
international comparisons are available, Canada spent 17% of total health expenditure on pharmaceuticals. That’s almost equivalent to the OECD average.
No single factor explains why some countries allocate a larger share of their
health care funds to drugs than do others. However, experts suggest that differences in service delivery—such as the level of public coverage and patient cost
sharing—may play an important role.11, 19 A broad range of other factors may
also be important. For example, the portion of health expenditures devoted to
drugs tends to be higher in low- or middle-income countries, partly because
drug prices are high relative to those of other health goods and services.11, 19
Although Canada spends a similar percentage on drugs when compared to
the OECD average, we tend to spend more overall than many countries. As a
result, in 2003, only the U.S. and France spent more on pharmaceuticals per
capita than Canada.
continued on next page
41 When Cost Prevents Access
More money does not necessarily buy better access. Just because a country spends
less on drugs per person does not necessarily mean that its citizens will report more
cost-related access problems. For example, Canada spent $507 U.S. per person on
pharmaceutical products (publicly and privately) in 2003, but 9% of people surveyed in
2004 said that they had not filled a prescription or had skipped doses because of cost
in the last year. The U.S. spent considerably more—$728 per person—but 21% reported cost-related access problems. The chart below shows the percentage of adults in
five countries in 2004 who reported that, because of cost, they did not get medical care
from a doctor; they skipped a medical test, treatment or follow-up; or they did not fill a
prescription or skipped doses of their medication at some point in the previous year.
35
Percent of Adults (%)
30
25
20
15
10
5
0
69
Did Not Get Medical
Care From Doctor
Australia
Did Not Fill Prescriptions
or Skipped Doses
Skipped Mediacal Test,
Treatment or Follow-up
Canada
New Zealand
UK
U.S.
Note: All countries show a statistically significant difference with one or
more countries in each of the categories.
Source: C. Schoen et al, “Primary Care and Health System Performance:
Adults’ Experiences in Five Countries,” Health Affairs Web Exclusive
(October 28, 2004): W4-487–W4-503.
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
An International Perspective
continued from previous page
Interestingly, differences in per capita spending clearly reflect more than
simply the price of medications in different countries. The Patented
Medicine Prices Review Board (PMPRB) regularly compares the prices
of patented medicines in Canada to those of seven other countries.±17
In the mid-1980s, on average, prices in Canada were below those in
the U.S., but higher than those in the other comparator countries.
Today, Canada falls in the middle. Compared to Canada, only Italy
and France had lower average prices for patented drug products in
2004. On the other hand, the PMPRB found that Canadian prices for
generic drugs were 21% to 51% higher than the median for comparator countries as well as Australia and New Zealand in 2003.29 Just as
spending and prices differ across countries, so does who pays for
drugs. Canada’s public-sector organizations play a smaller role in
financing drug expenditures than those in many other OECD countries. Among countries with the most comparable data, the public
share in 2003 ranged from 21% in the U.S. to 75% in Germany.
± The comparator countries
were France, Germany, Italy,
Sweden, Switzerland, the UK
and the U.S.
42 Public Spending Across Countries
The public share of drug spending varies considerably across OECD countries, with Canada towards the lower end. On a per capita basis, however,
the Canadian public sector spent $193 U.S. per person on drugs in 2003.
The figure below shows how public- and private-sector spending per capita
compares with that of nine other OECD countries.
Per Capita Drug Expenditure ($U.S.)
800
700
600
500
400
300
200
100
0
k
ar
nm
De
u
So
th
r
Ko
ea
H
g
un
ar
y*
Th
eN
lan
er
et h
ds
pa
Ja
n*
Public Sector
Sw
e
itz
rla
nd
y
an
rm
Ge
n
Ca
ad
a
ce
an
Fr
U.
S.
Private Sector
70
Notes: Expenditures are converted to U.S. dollars using purchasing power parities (PPPs) for gross
domestic product (GDP), which are designed to eliminate differences in price levels between countries.
The OECD asks that member countries report health expenditures according to their system of health
accounts. The 12 countries that most closely follow the proposed system of health accounts are Australia,
Canada, Denmark, France, Germany, Hungary, Japan, South Korea, the Netherlands, Switzerland, the UK
and the U.S.
*Percentages reported for Hungary and Japan are 2002 data. Data for Australia and the UK were not available.
Source: OECD Health Data 2005, OECD.
Retail Drug Sales
For More Information
1. The Conference Board of Canada, Understanding Health Care Cost Drivers
and Escalators (Ottawa: The Conference Board of Canada, 2004).
2. E. Brown, “Halfway Technologies,” Physician Executive 22, 12 (1996):
pp. 44–46.
3. C. Poulin, “Medical and Nonmedical Stimulant Use Among Adolescents:
From Sanctioned to Unsanctioned Use,” Canadian Medical Association
Journal 165, 8 (2001): pp. 1039–44.
4. C. Sanmartin, E. Ng, D. Blackwell, J. Gentleman, M. Martinez and
C. Simile, Joint Canada/United States Survey of Health, 2002–03
(Ottawa: Ministry of Industry, 2004).
5. IMS Health Canada, Growth in Retail Prescriptions Slows in 2004,
[online], last modified March 7, 2005, cited July 12, 2005, from
<http://www.imshealthcanada.com/htmen/1_0_16.htm>.
6. S. Morgan, “Sources of Variation in Provincial Drug Spending,”
Canadian Medical Association Journal 170, 3 (2004): pp. 329–30.
7. Statistics Canada, “Health Care Services—Recent Trends,”
Health Reports 11, 3 (1999): pp. 91–109.
8. W. J. Millar, “Disparities in Prescription Drug Insurance Coverage,”
Health Reports 10, 4 (1999): pp. 11–31.
9. P. Grootendorst, E. C. Newman and M. A. H. Levine, “Validity of
Self-Reported Prescription Drug Insurance Coverage,” Health Reports
14, 2 (2003): pp. 35–43.
10. A. H. Anis, D. Guh and X. Wang, “A Dog’s Breakfast: Prescription
Drug Coverage Varies Widely Across Canada,” Medical Care 39, 4
(2001): pp. 315–26.
11. Canadian Institute for Health Information, Drug Expenditure in Canada
1985 to 2004 (Ottawa: CIHI, 2005).
71
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
12. J. P. Gregoire, P. MacNeil, K. Skilton, J. Moisan, D. Menon, P. Jacobs, E.
McKenzie and B. Ferguson, “Inter-Provincial Variation in Government Drug
Formularies,” Canadian Journal of Public Health 92, 4 (2001): pp. 307–11.
13. M. E. Coombes, S. G. Morgan, M. L. Barer and N. Pagliccia, “Who’s the
Fairest of Them All? Which Provincial Pharmacare Model Would Best
Protect Canadians Against Catastrophic Drug Costs?” Longwoods
Review 2, 3 (2004): pp. 13–26.
14. Régie de l’assurance maladie Québec, The Public Plan: The Costs—
Premium, [online], last modified 2004, cited August 17, 2005, from
<http://www.ramq.gouv.qc.ca/en/citoyens/assurancemedicaments/
regimepublic/lescouts_laprime.shtml>.
15. P. Grootendorst, “Beneficiary Cost Sharing Under Canadian Provincial
Prescription Drug Benefit Programs: History and Assessment,” Canadian
Journal of Clinical Pharmacology 9, 2 (2002): pp. 79–99.
16. The Patented Medicine Prices Review Board, Patented Medicine Prices
Review Board Annual Report 2003 (Ottawa: PMPRB, 2004).
17. The Patented Medicine Prices Review Board, Patented Medicine Prices
Review Board Annual Report 2004 (Ottawa: PMPRB, 2005).
18. S. Morgan, “Quantifying Components of Drug Expenditure Inflation:
The British Columbia Seniors’ Drug Benefit Plan,” Health Services
Research 37, 5 (2002): pp. 1243–66.
19. S. Jacobzone, Pharmaceutical Policies in OECD Countries: Reconciling
Social and Industrial Goals (Paris, France: Organisation for Economic
Co-operation and Development, 2000).
20. R. Tamblyn, R. Laprise, J. A. Hanley, M. Abrahamowicz, S. Scott, N. Mayo,
J. Hurley, R. Grad, E. Latimer, R. Perreault, P. McLeod, A. Huang, P.
Larochelle and L. Mallet, “Adverse Events Associated With Prescription
Drug Cost-Sharing Among Poor and Elderly Persons,” Journal of the
American Medical Association 285, 4 (2001): pp. 421–29.
72
21. R. Tamblyn, “The Impact of Pharmacotherapy Policy: A Case Study,”
The Canadian Journal of Clinical Pharamacology 8 (2001): pp. 39A–44A.
Retail Drug Sales
22. C. E. Forget, The Quebec Experience: Lessons to Be Learned, [online], last
modified September 23, 2002, cited August 17, 2005, from<http://www.
irpp.org/events/archive/sep02/forget.pdf>.
23. Régie de l’assurance maladie Québec, The Public Plan: The Costs—At the
Pharmacy, [online], last modified 2004, cited August 17, 2005, from
<http://www.ramq.gouv.qc.ca/en/citoyens/assurancemedicaments/regime
public/lescouts_alapharmacie.shtml>.
24. Reference Drug Program Consultation Panel, Report of the Reference Drug
Program Consultation Panel, [online], last modified April 5, 2002, cited
July 20, 2005, from <http://www.healthservices.gov.bc.ca/cpa/publications/
rdppanel.pdf>.
25. Canadian Health Services Research Foundation, Reference-Based Drug
Insurance Policies Can Cut Costs Without Harming Patients, [online],
last modified 2005, cited July 22, 2005, from <http://www.chsrf.ca/
mythbusters/pdf/boost2_e.pdf>.
26. Government of Nova Scotia, Nova Scotia Pharmacare Program: Pharmacists’
Guide, [online], cited August 30, 2005, from, <http://www.gov.ns.ca/health/
pharmacare/pubs/Rx-guide.pdf>.
27. Ontario Medical Association, Health Policy Report—A Summary of Current
Health Legislation and Policy Developments, [online], last modified
April 2005, cited July 20, 2005, from <http://www.oma.org/phealth/hpolrep/
05hpr.htm>.
28. Statistics Canada, Household Spending on Prescription Drugs as a
Percentage of After-Tax Income, Canada and Provinces, 2002, [online],
last modified 2004, cited July 20, 2005, from <http://www.statcan.ca/
english/freepub/82-401-XIE/2002000/tables/pdf/dt003_en.pdf>.
29. Patented Medicine Prices Review Board, A Study of the Prices of the
Top Selling Multiple Source Medicines in Canada, [online], last
modified November 2002, cited July 22, 2005, from <http://www.
pmprb-cepmb.gc.ca/CMFiles/2003e-MultipleSourceStudy21KZI6182003-1471.pdf>.
73
Canada’s Health System
Financing, Ownership and Delivery
Pr
iva
Physicians
Drugs
Oral Health
Source: Adapted from I. McKillop, J. Alpenberg,
R. G. Evans, et al., Private Sector Delivery: Scope
and Extent in Canada’s Health Care System,
(Waterloo: University of Waterloo, 2004).
Hospitals
Public
Ownership/Operation
S
Private P
ub
l
liv
De
of
ic
y
er
Oral Health
Care Services
te
es
ic
v
er
7
Public
Private
Source of Funding
Quick Facts
Use
• 64% of Canadians aged 12 or older reported consulting a dentist or
orthodontist at least once in 2003. This varied across the country from
less than half (48%) in Newfoundland and Labrador to 69% in Ontario.
• 26% of Canadian adults reported that they did not seek needed dental
care because of cost in 2004.
Coverage
• 61% of teens and adults reported having dental insurance in 2003—up
from 53% in 1996–1997.
Spending
• $290 was the average amount spent by Canadian households on
dental care in 2002.
• $424 million, or 4.6% of total spending on dental care, came from
the public sector in 2004.
• 58% of Canadian employees were offered some dental benefits by
their employers in 2002.
• Over the past 20 years, the private sector’s share of spending on
dental care has risen from 89% in 1984 to 95% in 2004.
75
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
“One does not have to travel too far back in the last century to find a time when
people in mid-life often lost most, or all, of their adult teeth because of tooth decay
and chronic gum infection.”1
Much has changed over the last century. Fluoridated drinking water, regular
oral hygiene and access to professional care have improved the oral health of
many Canadians.1, 2 Oral health care is primarily financed through private insurers (for example, work-related benefits) and out-of-pocket spending. According
to recent national survey data, income and insurance status appear to be strong
predictors of use of dental services. This chapter explores the use and financing
of such care.
Dental Consultations
Daily flossing and brushing have many
benefits, but professional help may
also be needed to maintain good oral
health.7 In 2003, nearly two-thirds (64%)
of Canadians aged 12 or older reported
consulting a dentist or orthodontist at
least once in the past year, up from
58% in 1996–1997.8 The consultation
rate ranged from 48% in Newfoundland
and Labrador to 69% in Ontario. The
pattern of use also varied by age, education, income and insurance status.
76
Oral Health of First Nations Children
Although the federal government provides dental
coverage for First Nations and Inuit children, the
children in this group continue to have poorer average
oral health than their non-Aboriginal counterparts.
A recent study examined the tooth status of 7- and
13-year-old First Nations children in the District of
Manitoulin, Ontario.3 Researchers found that 96% of
children had at least one tooth with active or past
decay. The average number of missing or extracted,
decayed and filled teeth was 6.2 among 7-year-olds and
4.1 among 13-year-olds. This is much higher than the
estimated average of 1.7 missing, decayed or filled teeth
among non-Aboriginal 13-year-olds in Ontario.4
What explains this difference? A number of theories
Some of this care was paid for
exist. Some researchers believe that lengthy preout-of-pocket, but dental insurance
approval processes to receive dental surgery and
is gradually becoming more common.
orthodontics may deter individuals from seeking
treatment.1 Others suggest that a lack of access to
According to Statistics Canada, 61%
fluoridated drinking water and other prevention and
of Canadians reported having some
treatment services may be an important factor.5, 6 In
public or private insurance in 2003—
addition, a recent report by federal, provincial and
up from 53% in 1996–1997.9 Insurance
territorial dental directors states that Aboriginal People
coverage is highest in the territories
may not seek dental care because of social/cultural
(81%). Among the provinces, insurance
factors. For instance, they may prefer to have dental
services provided in their own language or by someone
coverage is highest in Alberta (71%).
who is familiar with their cultural background.2
Little is known about the nature of
these insurance plans, such as what
services are covered and whether enrollees pay
small or large copayments and deductibles.
Oral Health Care Services
43
Different Groups, Different Use
There is a strong relationship between income and the chances of consulting
a dentist or orthodontist. Teens and adults in higher-income households were
more likely to report receiving dental services in 2003, as shown in the figure
below. However, at all levels of income, Canadians with some dental insurance were more likely to have consulted a dentist or orthodontist than their
uninsured counterparts.
% Who Consulted a Dentist/Orthodontist
90
80
What Predicts Use?
70
60
50
40
30
20
10
0
Lowest Income
LowerMiddle Income
Uninsured
UpperMiddle Income
Highest Income
Insured
Note: Includes respondents aged 12 or older.
Source: Canadian Community Health Survey, Statistics Canada, 2003.
44 A Glimpse of Oral Health in B.C.
In the 2003 Canadian Community Health Survey, respondents from British
Columbia rated the health of their teeth and mouth. Most (84%) rated their
dental health as “excellent,” “very good” or “good.” Those who did so were
more likely to have dental insurance or to have sought dental care in the past
year than those who reported worse oral health. For example, 70% of respondents who rated their oral health as “excellent” had some dental insurance,
and 78% had sought dental care in the past year. Among those who rated
their oral health as “poor,” only 36% had some dental insurance, and less
than half (47%) sought dental care.
Excellent
Both income and insurance
status appear to be strongly
related to use of dental care
services.* The two are also
entwined. High-income
Canadians are much more
likely to have private dental
insurance. They are also
more apt to consult a dentist or orthodontist. Insured
Canadians were twice as
likely to have consulted a
dentist or orthodontist in
the past year as the noninsured. High-income earners were three times more
likely to do so than the lowest income earners.
* The methodology for this logistic regression analysis is adapted from W. Millar
and D. Locker, “Dental Insurance and Use
of Dental Services,” Health Reports 11, 1
(1999): pp. 55-65. The following variables
were included in the regression model:
age, sex, province, education, income
level, insurance status and job status.
Oral Health Rating
Very Good
Good
Fair
77
Poor
0
10
20
30
40
50
60
70
80
90
% of Respondents
Insured
Consulted Dentist/Orthodontist
Note: Includes respondents aged 12 or older.
Source: Canadian Community Health Survey (Cycle 2.1), Statistics Canada, 2003.
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Canadian Spending Compared
The health care financing divide along the 49th parallel is much
less pronounced for dental services than for other areas of the
health system. In 2004, Canada spent about $9.3 billion, or $290
per person, on dental services. This puts us at the high end of the
expenditure range among Organisation for Economic Co-operation
and Development (OECD) countries, along with countries like
Germany, Switzerland and the United States. Interestingly, rates of
dental insurance and visits to dentists are also almost identical
on both sides of the Canada/U.S. border, according to a 2002–2003
survey.14 The proportion of dental costs that are paid by the public
sector is also similar in Canada and the U.S.
There is, however, a difference in terms of unmet need. In a
2004 Commonwealth Fund International Health Policy survey,
about one-quarter (26%) of Canadian adults reported that they
needed dental care but did not see a dentist because of the cost.15
Even more adults in the U.S. (38%) agreed with this statement.
This was the highest level of unmet need reported across the
five countries surveyed. The United Kingdom had the lowest rate,
with 21% of adults reporting financial cost as a barrier to seeking
dental care.
45 Public Spending Across Countries
The extent to which dental care is covered by public funds varies across
OECD countries. In 2003, the public share of total dental care spending
ranged from less than 10% in Canada, Switzerland and the U.S. to more than
half of dental spending in Germany and Japan.
90
Public Spending as a Percent of
Total Dental Care Spending (%)
80
78
70
60
50
40
30
20
10
0
Canada Switzerland
U.S.
Hungary*
France
Denmark
Germany
Japan*
Notes: Comparisons are made against 11 other comparator countries that most closely follow the health
care boundary proposed by the OECD.
*Percentages reported for Hungary and Japan are 2002 data. Data for Australia, South Korea, the
Netherlands and the UK were not available.
Source: OECD Health Data 2005, OECD.
Aging Teeth?
Canadians are not only living
longer, they are also keeping
more of their natural teeth.10
However, seniors are less
likely to use dental care
services than others.2 In
2003, fewer than half (46%)
said that they had consulted
a dentist or orthodontist
within the past year. This
is significantly less than the
overall average for teens
and adults (64%).
A variety of potential explanations for this difference have
been proposed. Some seniors
may, for example, have restricted mobility, transportation
challenges, difficulty affording
dental care and/or a lack of
dental insurance.11, 12 Although
almost two-thirds of teens and
adults (61%) reported having
some public or private dental insurance, less than a
third of seniors (29%) were
insured in 2003. Seniors with
insurance were twice as likely
to have consulted a dentist
or orthodontist as the noninsured. Although most
provinces and territories
cover some oral health care
for social assistance recipients, only a few—Alberta,
Prince Edward Island and
the Northwest Territories—
fund some dental care for
seniors as part of their
public plans.13
Oral Health Care Services
The Public Sector and Dental Care
In 2004, public-sector spending on dental care in Canada was estimated at
$424 million, or less than 5% of dental care spending outside of hospitals. With
the exception of hospital-based services, coverage for dental care varies across
the country. Where you live matters, but within each province or territory there
are also differences by population group, by mix of services and by means of
access to the services. For example, dental hygienists and assistants may
provide education and fluoride programs for children in schools.13
In addition to provincial and territorial programs, some Canadians are eligible for coverage or services paid for by the federal government. As well, some
communities provide dental services through public health or other programs.16
The federal government alone paid $165 million for dental care in 2002–2003,
about 39% of the public-sector total. Most of these costs were for services
provided through a national health benefit program for about 765,000 eligible
registered Indians and recognized Inuit and Innu.17
46 A Snapshot of Who’s Covered
Most provincial and territorial plans include some dental coverage for children and social assistance recipients. Alberta, Nova Scotia, Prince Edward
Island and the Northwest Territories also provide some dental coverage for
seniors and/or cleft palate patients. The level of coverage, however, varies,
and may be more extensive in some programs than in others. For example,
some programs may cover only basic services, such as routine cleaning,
x-rays or fillings. More comprehensive programs may include coverage for
orthodontic care, root canals or dentures. Although municipal programs
for dental care also exist, the table below includes only provincial and
territorial programs.
B.C.
Alta.
Sask.
Man.
Ont.
Que.
N.B.
N.S.
P.E.I.
N.L.
Y.T.
N.W.T.3
Nun.
Children’s
Program
Social
Assistance Program
Cleft Palate
Program
Seniors’
Program
!
!
!
!
!
!
!
!
!
!
!
!
!
!
!
!
!
!
!
!
!
!
!
!
!
!
!
!
!
1
2
Notes: 1 Available only for residents under the age of 22.
2 Includes only seniors residing in provincial and private long-term care facilities.
3 The Northwest Territories also provides some public dental care coverage for
residents who meet the eligibility requirements for the Métis Health Benefits Policy.
Sources: Canadian Association of Public Health Dentistry, Public Programs, cited July 19, 2005, from
<http://www.caphd-acsdp.org/index.html>; Ontario Ministry of Health and Long-Term Care, Children’s
Health, [online], cited August 16, 2005, from <http://www.health.gov.on.ca/english/public/program/child/
cinot.html>.
79
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
47 Private Share of Dental Care
The Primary Payers
The private sector—through
out-of-pocket payments and
private insurance—dominates
dental care financing in
Canada. In 2004, the private
sector paid $8.8 billion for
dental care services, or 95%
of total dental care expenditures. Insurers bear just over
half of the private sector’s
share of dental costs. According to the 2002 Survey of
Labour and Income Dynamics, 58% of Canadian employees were offered some
dental insurance. During that
year, private insurance companies paid out $4.4 billion
for dental care.
80
Individual Canadians
bear the balance of dental
care expenses. Data from
Statistics Canada show that
Canadian households spent
an average of $290 out-ofpocket on dental care in
2002. A closer look reveals
that about half (52%) of
households paid some
amount out-of-pocket for
dental care. These households spent an average of
$558 on dental care services.
In 2004, total spending on dental care was forecast at $290 per person. Over
the last 20 years, dental care expenditures have doubled, after adjustment for
inflation. Over this period, the private-sector share rose from 89% in 1984 to
95% in 2004. The map below shows the private share of spending on dental
care per person in 1984 and 2004.
1984
2004
89%
95%
63%
72%
91%
96%
66%
91%
47%
30%
85%
94%
86%
91%
73%
87%
98%
99%
81%
91%
75%
91%
93%
94%
80%
94%
Notes: Comparable 1984 data for the Northwest Territories
and Nunavut are not available. Data for 2004 are forecasts.
Source: National Health Expenditure Database, CIHI.
48 Private Dental Insurance
Employer benefits are an important source of coverage for many health services, including dental care. In 2002, about 58% of Canadian employees were
offered some dental insurance by their employers. Among these individuals,
most (89%) had benefits offered in conjunction with medical and life/disability
insurance. The figure below shows the proportion of employees with dental
insurance that were offered one, two or all three types of benefits.
Dental, Medical and Life
Disability
89.0%
Dental and Life Disability
1.3%
Dental and Medical
8.4%
Dental Only
1.3%
Notes: Data include all persons who did some paid work in 2002. Information about
non-wage benefit coverage is derived from the respondent’s main paid job. The extent
of dental coverage varies depending on the type of benefits offered by employers.
Source: Survey of Labour and Income Dynamics, Statistics Canada, 2002.
Oral Health Care Services
For More Information
1. Canadian Institutes of Health Research, The Institute of Musculoskeletal
Health and Arthritis (IMHA)—Oral Health Research, [online], last modified
2005, cited July 19, 2005, from <http://www.cihr-irsc.gc.ca/e/11199.html>.
2. Federal, Provincial and Territorial Dental Directors, A Canadian Oral Health
Strategy, [online], last modified April 2004, cited July 19, 2005, from
<http://www.fptdd.ca/COHS%200406.pdf>.
3. S. Peressini, J. L. Leake, J. T. Mayhall, M. Maar and R. Trudeau, “Prevalence
of Dental Caries Among 7- and 13-Year-Old First Nations Children, District of
Manitoulin, Ontario,” Journal of the Canadian Dental Association 70, 6
(2004): pp. 382–382e.
4. Canadian Dental Association, First Nations and Inuit Oral Health, [online],
last modified 2005, cited July 14, 2005, from <http://www.cda-adc.ca/
english%5Cnews_events%5Cevents%5Ccda_events%5Cdoth04%5Cpdfs/
nihb_factsheet.pdf>.
5. F. Wien and L. McIntyre, “Health and Dental Services for Aboriginal People,”
in First Nations and Inuit Regional Health Survey: National Report 1999
(Ottawa: First Nations and Inuit Regional Health Survey National Steering
Committee, 1999), pp. 217–45.
6. Health Canada, A Statistical Profile on the Health of First Nations in Canada
(Ottawa: Health Canada, 2003).
7. D. Lewis and A. I. Ismail, Periodic Health Examination, 1995 Update: 2.
Prevention of Dental Caries, [online], last modified 1995, cited July 14, 2005,
from <http://www.ctfphc.org/Tables/Caries_tab.htm>.
8. Statistics Canada, Contact With Dental Professionals, by Age Group and Sex,
Household Population Aged 12 and Over, Canada Excluding Territories,
1994/95–1998/99, [online], last modified 2002, cited July 14, 2005, from
<http://www.statcan.ca/english/freepub/82-221-XIE/2005001/tables/
pdf/4291.pdf>.
81
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
9. Statistics Canada, “Health Care Services—Recent Trends,” Health Reports
11, 3 (1999): pp. 91–109.
10. J. Leake, “The History of Dental Programs for Older Adults,” Journal of the
Canadian Dental Association 66, 6 (2000): pp. 316–19.
11. Health Canada, The Effects of Oral Health on Overall Health, [online], last
modified March 2004, cited July 14, 2005, from <http://www.hc-sc.gc.ca/
english/iyh/lifestyles/dental.html>.
12. The Canadian Dental Hygienists Association, Access Angst: A CDHA
Position Paper on Access to Oral Health Services, [online], last modified
March 23, 2003, cited July 14, 2005, from <http://www.cdha.ca/pdf/
position_paper_access_angst.pdf>.
13. Canadian Association of Public Health Dentistry, Public Programs, [online],
last modified 2005, cited July 14, 2005, from <http://www.caphd-acsdp.
org/programs.html>.
14. C. Sanmartin, E. Ng, D. Blackwell, J. Gentleman, M. Martinez and C. Simile,
Joint Canada/United States Survey of Health, 2002–03 (Ottawa: Ministry of
Industry, 2004).
15. Harris Interactive, International Health Perspectives, 2004,
[online], last modified July 8, 2004, cited July 14, 2005, from
<http://www.cmwf.org/usr_doc/IHP2004_topline_results.pdf>.
16. Toronto Public Health, Dental Services, [online], last modified 2005, cited
July 14, 2005, from <http://www.city.toronto.on.ca/health/dental.htm>.
17. Health Canada, Non-Insured Health Benefits Program: Annual Report
2002/2003 (Ottawa: Health Canada, 2003).
82
Canada’s Health System
Financing, Ownership and Delivery
8
Eye Care
es
y
er
of
S
Pr
iva
te
ic
v
er
Physicians
Drugs
Oral Health
Eye Care
Source: Adapted from I. McKillop, J. Alpenberg,
R. G. Evans, et al., Private Sector Delivery:
Scope and Extent in Canada’s Health Care
System (Waterloo: University of Waterloo, 2004).
Hospitals
Public
Ownership/Operation
D
Private P
ub
lic
iv
el
Public
Private
Source of Funding
Quick Facts
Use
• 39% of Canadians aged 12 or older reported having consulted an
eye care specialist (optometrist or ophthalmologist) within the past
year in 2003.
• The rate of consultations varied according to where people lived and
by age group.
Coverage
• 55% of Canadians aged 12 or older reported having some
supplementary coverage for glasses and contact lenses in 2003—
up from 47% in 1996–1997.
• High-income earners are four times more likely than low-income
earners to have some coverage. Non-insured Canadians are about
as likely to seek care as the average Canadian.
Spending
• $161 was spent, on average, per Canadian household on eye care
goods and services in 2003. Average spending ranged from $125 in
Nova Scotia to $208 in Alberta.
83
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Many Providers, Many Services
From contacts to laser eye surgery, a series
of innovations has transformed vision care.
Options now exist to care for once untreatable
conditions, such as glaucoma, cataracts and
diabetic retinopathy.1 Same-day clinics now
perform surgery that used to require several
days in hospital. Nevertheless, sight disorders
continue to cause substantial long-term disability. Health Canada estimated productivity
losses at $633 million in 1998.2
Individuals and insurance companies
finance most optometrist and optician services, as well as eyeglasses and contact
lenses. Over the past two decades, total
spending on these types of services has
doubled (after adjusting for inflation).* The
public sector plays a greater role in financing
eye care services provided by physicians
and hospitals. Public funding also covers the
cost of routine eye examinations for some
groups, but many provinces and territories
have fully or partially delisted these tests.
Seeking Eye Care
84
Many different types of health professionals
provide eye care services. For example,
Canadians may visit one of the country’s
3,800* optometrists to receive a routine eye
examination. Optometrists are trained to
assess the visual system for dysfunctions
and refractive disorders. They may prescribe
corrective and preventive eyewear for their
patients. One of Canada’s 5,900* opticians
may fill these prescriptions. They are
responsible for supplying, preparing and
dispensing eyewear.3
• Ophthalmologists are physicians who
specialize in the diagnosis and treatment of
eye diseases. They provide comprehensive
examinations, prescribe corrective lenses,
perform surgery and prescribe and administer
medication. There were 1,055 ophthalmologists who practised across the country in
2003, down from 1,085 four years earlier.
• Orthoptists evaluate and provide non-surgical
treatment for visual disorders caused by an
imbalance of the eye muscles. They work
with ophthalmologists.
• Ophthalmic medical assistants work under
the supervision of ophthalmologists and provide diagnostic and therapeutic procedures.3
• Family physicians also play an important
role in the prevention and treatment of eye
diseases. For instance, they treat common
eye infections and refer patients to other eye
care professionals as needed.3
In 2003, over one-third (39%) of Canadians
aged 12 or older reported having consulted
an eye care specialist (optometrist or ophthalmologist) within the last year—up from 35% in
*The coefficient of variation indicates that these Labour Force Survey
estimates may be unreliable.
1998–1999. In 2003, rates varied from 34% in
Newfoundland and Labrador and British
Columbia to 42% in Saskatchewan. Younger people (12 to 24 years of age) and
seniors were more likely to have visited an eye care specialist than other adults
(40% and 57%, respectively). This may reflect, in part, the fact that public insurance plans cover routine eye examinations for children and seniors in most
areas of the country.
* Expenditures are inflation-adjusted using the consumer price index—Health Care Component.
Eye Care
Public Insurance Coverage
Most public-sector spending on eye care goes towards physician and hospital
services. For example, fee-for-service payments to ophthalmologists alone
totalled $407 million in 2002–2003. A smaller amount goes towards optometrist
and optician services, eyeglasses and contact lenses. In 2004, the public sector
spent a forecast $250 million in these areas, less than 10% of all such expenditures. The public share was highest in the territories, with Nunavut leading the
way at 64%. Among the provinces, public-sector spending ranged from $1 per
person in Newfoundland and Labrador to $11 in Ontario.
49 Insurance and Consultations for Eye Care
In 2003, the rate at which Canadians reported consulting an eye specialist
ranged from 34% in Newfoundland and Labrador and British Columbia to
42% in Saskatchewan. The percentage of those with some public and/or private insurance to cover the costs of their eyeglasses and contact lenses also
varied—from 39% in Quebec to 77% in the territories.
Consulted an Eye Specialist
Canada
39%
55%
Has Public/Private Insurance
37%
77%
34%
60%
34%
54%
41%
59%
37%
54%
42%
61%
41%
62%
39%
39%
37%
58%
37%
65%
37%
62%
Note: Includes respondents aged 12 or older.
Source: Canadian Community Health Survey (Cycle 2.1), Statistics Canada, 2003.
The Ophthalmologist’s Bill
Provincial governments paid ophthalmologists
$407 million through fee-for-service insurance
plans in 2002–2003. Almost two-thirds (61%)
of this amount was for eye surgery and other
procedures. The rest was for consultations
and visits. Across the provinces, spending
ranged from $9 per capita in Newfoundland
and Labrador to $20 in Nova Scotia.
Where is this money
going? Many provinces and
territories cover routine eye
examinations for children,
seniors and social assistance
recipients. In most cases, eye
examinations are covered
annually. However, there are
some exceptions. For example,
Saskatchewan typically pays
for social assistance recipients
aged 18 to 64 to have an eye
examination every two years.
The Nova Scotia government
has a similar policy for children
and seniors, as does the federal
Non-Insured Health Benefits program for the adults it insures.
New Brunswick, Prince Edward
Island and Newfoundland and
Labrador do not cover routine
eye examinations.
Public plans also cover eye
examinations where “medically
necessary”—although what falls
into this category varies across
the country. Many provinces
and territories cover eye
examinations for persons
with diabetes since they are
more likely to develop serious
eye problems.
85
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
About 5% of Canadians aged 12 or older reported having diabetes in 2003. In
that same year, almost two-thirds (62%) of these individuals reported having
consulted an eye care specialist in the past year, more than the overall national
average of 39%. The Canadian Diabetes Association recommends that persons
15 years of age or older with Type I diabetes have annual eye examinations
starting five years after onset. They also suggest that persons with Type II
diabetes have an eye examination every one or two years.4
Most Canadians have supplementary insurance to cover part or all of the
cost of eyeglasses or contact lenses. In 2003, over one-half (55%) of Canadian
teens and adults reported having some supplementary coverage for eyeglasses
and contact lenses—up from 47% in 1996–1997.6
Delisting of Eye Exams
86
Finding variations in the use
of eye care services over time
does not necessarily mean that
delisting caused the changes
observed. According to a preliminary study by researchers
at the University of Toronto,
other factors also need to
be considered. They suggest
that the demand for services
can vary significantly across
populations, and an individual’s
use of a service depends on
factors such as income, sex,
insurance status and use of
the service prior to it becoming
delisted.5
Delisting of Eye Exams
40
% Who Consulted an Eye Specialist
There’s a mix of coverage for
routine eye examinations
across the country. Some
50
provinces—Prince Edward
Island and New Brunswick—
never paid for them. Others have
reduced coverage over time.
For example, Newfoundland
and Labrador delisted this
service for all residents on
April 1, 1991. More recently,
routine eye examinations for
adults were delisted in British
Columbia (November 19, 2001)
and Ontario (November 1, 2004).
Survey data suggest that adults
in British Columbia were more
likely to have consulted an eye
care specialist in the year prior
to delisting, but rates then
returned to earlier levels.
35
30
25
20
15
10
5
0
1998–1999
2000–2001
B.C.
2003
Canada
Note: Includes respondents aged 20 to 64 years.
Source: National Population Health Survey (Health File), Statistics Canada, 1998–99;
Canadian Community Health Survey (Cycle 1.1), Statistics Canada, 2000–01;
Canadian Community Survey (Cycle 2.1), Statistics Canada, 2003.
Eye Care
51 Income and Eye Care
Canadians with higher incomes are more likely to have some public and/or
private insurance to fund the cost of eyeglasses and contact lenses. In 2003,
72% of high-income earners reported having some insurance, compared to
only 33% of low-income earners. However, those with a lower income were
about as likely as those with a high income to have consulted an eye care
specialist in the past year.
80
70
% of Canadians
60
50
40
30
20
There are, however, important coverage differences by
income. Compared to those
with low incomes, high-income
Canadians were four times more
likely to report having insurance.
However, in 2003, those without
insurance were about as likely
to have consulted an eye care
specialist (36%) as Canadians
overall (39%).
10
0
Lowest Income
Lower-Middle Income
Upper-Middle Income
% Consulted an Eye Care Specialist
Highest Income
% Insured
Note: Includes respondents aged 12 or older.
Source: Canadian Community Health Survey (Cycle 2.1), Statistics Canada, 2003.
Access to Visual Aids and Rehabilitation
The 2001 Participation and Activity Limitation Survey
reported that over 500,000 Canadian adults with a visual
disability required the use of visual aids or devices.7 The
vast majority (87%) of these individuals reported that their
needs for aids and devices were fully met. The remaining
13% said that they had partially or completely unmet needs,
largely due to cost issues and a lack of information on where
to obtain these products.
Currently, Alberta, Saskatchewan, Ontario and Quebec
have public programs offering assistive devices to children, adults and seniors. Other areas of the country offer
limited funding for employment-related assistive devices.1, 8
Additionally, Quebec provides publicly funded rehabilitation after vision loss, including services such as orientation
and mobility training. The Canadian National Institute for
the Blind typically provides these services for individuals
living outside of Quebec.1
More Than
Pocket Change
In total, Canada spent
$3.1 million on vision care
(provided by optometrists and
opticians), eyeglasses and
contact lenses in 2004. Today’s
spending levels are twice those
in 1984, after adjusting for
inflation. Over the past 20
years, the private-sector share
of spending on these types of
vision care has also continued
to rise—from 86% in 1984 to a
forecast 92% in 2004.
While most Canadians
have some public or private
insurance coverage, individuals
paid about $2.0 million outof-pocket in 2002. Although
much of this money is spent
on prescription eyewear, laser
eye surgery is becoming an
increasingly popular choice.
According to a 2003–2004 poll
by BBM RTS Canada, over
280,000 Canadian teens and
adults said that they have had
laser eye surgery.
87
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
52 Paying for Vision Care
Surgery recipients were
mostly female (69%) or aged
55 or older (79%).9 Laser eye
surgery is commonly used to
treat refractive disorders such
as nearsightedness (myopia),
farsightedness (hyperopia)
and astigmatism (distorted
vision from a distance).10
These are generally considered elective procedures
and, therefore, are not
covered by public health
insurance plans. Although
we do not know the exact
amount that Canadians are
spending out-of-pocket for
these services, we do know
that the costs can vary significantly, depending on the
patient’s condition and
circumstances and on fees
set by each practice.11
The private sector paid for 92% of vision care provided by optometrists
and opticians, eyeglasses and contact lenses in 2004, up from 86% in 1984.
The map below compares the private share of spending on these services in
1984 and in 2004 for each province and territory. It also shows forecast total
(public and private sector) per capita spending in 2004.
Private-Sector Share (%), 1984
Canada
86%
92%
Private-Sector Share (%), 2004
97
($)
89%
91%
164
Total per Capita ($)
80
88%
99%
36%
81
85%
92%
93
87%
93%
112
62%
106
85%
92%
85
92
97
86%
92%
86%
96%
97
85%
89%
100%
99% 72
87%
94%
90%
96%
74
74
Note: Comparable data for 1984 are not available for the
Northwest Territories and Nunavut. Data for 2004 are forecasts.
Source: National Health Expenditure Database, CIHI.
53 Household Eye Care Expenses
In 2003, Canadians spent an average of $161 out-of-pocket per household
on eye care goods and services. Average spending ranged from $125 in
Nova Scotia to $208 in Alberta. Most dollars spent went towards glasses
and contact lenses, with smaller amounts going towards services such as
eye examinations and surgery.
88
Average Household Spending ($)
250
200
150
100
50
0
B.C.
Alta.
Sask. Man.
Ont.
Que.
Prescription Eyewear
N.B.
N.S.
P.E.I.
Other Eye Care Goods
N.L.
Y.T.
Nun. N.W.T. Canada
Eye Care Services
Note: Spending data on eye care services in the Northwest Territories
and Nunavut are not available due to small sample size.
Source: Survey of Household Spending, Statistics Canada, 2003.
Eye Care
For More Information
1. Canterbury Communications, A Clear Vision: Solutions to Canada’s Vision
Loss Crisis, (report on the Symposium on the Cost of Blindness: What It
Means to Canadians), (Toronto: Canterbury Communications, 2004), [online],
last modified October 14, 2004, cited July 12, 2005, from <http://www.
costofblindness.org/media/docs/A%20Clear%20Vision%20Sept%2023.doc>.
2. Health Canada, Economic Burden of Illness in Canada, 1998 (Ottawa:
Health Canada, 2002).
3. Canadian Ophthalmological Society, The Eye Care Team, [online], last
modified 2004, cited July 12, 2005, from <http://www.eyesite.ca/english/
public-information/eye-care-team.htm>.
4. Canadian Diabetes Association and Clinical Practice Guidelines Expert
Committee, 2003 Clinical Practice Guidelines: Retinopathy, [online], last
modified December 2003, cited July 12, 2005, from <http://www.diabetes.ca/
cpg2003/downloads/retinopathy.pdf>.
5. M. Stabile and C. Ward, “The Effects of De-listing Publicly Funded Health
Care Services,” (forthcoming).
6. Federal, Provincial and Territorial Advisory Committee on Population Health,
Statistical Report on the Health of Canadians (Ottawa: Health Canada, 1999).
7. G. Fawcett, C. Ciceri, S. Tsoukalas and A. Gibson-Kierstead, Supports and
Services for Adults and Children Aged 5–14 With Disabilities in Canada: An
Analysis of Data on Needs and Gaps (Ottawa: Canadian Council on Social
Development, 2004).
8. The Canadian National Institute for the Blind, Assistive Devices Program,
[online], last modified November 5, 2002, cited July 12, 2005, from
<http://www.cnib.ca/eng/cgr/election/adp.htm>.
9. Television Bureau of Canada, Laser Eye Surgery Centres Industry Report,
[online], posted May 2005, cited July 6, 2005, from <http://www.tvb.ca/
EStartAE.htm>.
10. Health Canada, Laser Eye Surgery, [online], last modified November 18, 2002,
cited July 12, 2005, from <http://www.hc-sc.gc.ca/english/iyh/
medical/laser_eye.html>.
11. Eye Surgery Education Council, Price of an Initial Procedure, [online], last
modified 2003, cited July 6, 2005, from <http://www.eyesurgeryeducation.
com/Cost.html>.
89
Canada’s Health System
Financing, Ownership and Delivery
es
y
er
of
S
Pr
iva
te
ic
v
er
Physicians
iv
Continuing
Care
Drugs
Oral Health
Eye Care
Private P
ub
l
ic
Home Care
Residential
Care
Facilities
Source: Adapted from I. McKillop, J. Alpenberg,
R. G. Evans, et al., Private Sector Delivery:
Scope and Extent in Canada’s Health Care
System, (Waterloo: University of Waterloo, 2004).
Hospitals
Public
Ownership/Operation
l
De
9
Public
Private
Source of Funding
Quick Facts
Use
• Over 110,000 Canadians lived in the 1,343 residential care facilities
that provided 24-hour personal care, medical and/or nursing supervision or institution-based care in the second quarter of 2001–2002.
• 1.2 million Canadian teens and adults reported using home care
services in 2003.
Coverage
• 73% of spending on residential care in Canada was funded by the
public sector in 2004.
Spending
• $178 to $665 per person was spent by public sources on
residential care in 2004.
• $54 to $158 per person was spent by provinces and territories on
public-sector home care in 2004.
91
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Canadians are living longer than ever before. Our life expectancy is one of the
best in the world—more than 79 years in 2001. That’s up from 59 years in the
early 1920s and 69 years in the 1950s.1–3 And, compared with 20 years ago,
older adults can, on average, look forward to better quality and longer lives.
However, not all Canadians enjoy good health. Continuing care services are
designed to step in when we can no longer live safely at home or when we
need support to do so. These services are provided both in the home and in
specialized facilities.
The term “continuing care” reflects two complementary concepts: care that
continues over a long period of time and an integrated program of care that
continues across different parts of the health system, from community services
to geriatric units in hospitals.4 For example, the Alberta Long Term Care
Association divides continuing care services into three streams:5
• Home care (including home health and home support services)
assists individuals so that they can continue living in their homes;
•
Supportive living options provide individuals with a secure living
environment and various levels of assistance with everyday living; and
• Continuing care facilities offer a broad range of services, from nursing
and personal care to accommodation and meals.
The way in which continuing care is structured, delivered and financed has
become a key policy issue in many parts of the country. Population ageing is
one factor driving this focus. If current patterns in the use of health services
continue, projected average annual growth rates in spending between 2002
and 2026 due purely to ageing would be highest for residential care facilities
(2.1% per year), followed by prescribed drugs (1.6%).6 This chapter focuses
on two vital components of continuing care—residential care and home care—
and the role of the public and private sectors in paying for these services.
Residential Care Facilities
The 2001 Census counted 327,670 Canadians who made a health care
institution their home.7 However, seniors are less likely to do so than in the past.
The proportion of those aged 75 and over living in such institutions fell to 14%
in 2001, down from 17% in 1981.8
92
Many lived in residential care facilities approved, funded or licensed by
provincial or territorial departments of health and/or social services. Examples
include nursing homes and other homes for the aged; facilities for persons with
physical disabilities, developmental delays, or psychiatric disabilities; facilities
for persons with alcohol and/or drug problems; and facilities for emotionally
disturbed children.
Continuing Care
Use of Residential Care
Suppose that you could no longer live safely at home. In Newfoundland and
Labrador, nursing homes provide support for people unable to live independently
and/or who require 24-hour care. But you would choose a residential continuingcare facility in Yukon Territory, a manor home in Prince Edward Island and a
long-term care facility in Ontario. In Manitoba, personal care homes offer facilitybased long-term care. In Saskatchewan, however, they offer only
non-professional services. The province’s special care homes provide facilitybased long-term care.10
Residential Care Quick Facts
• In 2001–2002, residential care facilities had almost
75% of the total number of beds available in the
health system. The rest were hospital beds.9
• Facilities for the aged account for 77% of all
residential care beds.
• Over the last 10 years, the occupancy rate for these
beds has been between 97% and 98%.9
Not only do the names of facilities
differ, but so do the types of services
that they provide. In this section,
we focus on facilities that provide
residential care to clients needing
24-hour personal care, as well as
medical and/or nursing supervision
(type II care or higher). In 2001–2002,
over 110,000 Canadians lived in the
1,343 facilities that met these criteria.
Starting in 1994–1995, Statistics Canada followed 2,300 people who were
living in health care institutions across the country.11 Most (68% of seniors)
reported at least one chronic condition, such as incontinence, Alzheimer’s
disease or other dementia and the effects of stroke. By 1998–1999, about
half were deceased.
The bad news is that two out of three residents had more chronic health
problems than four years before. The most common new conditions were
osteoporosis, heart disease and Alzheimer’s disease and other forms of
dementia. This trend is expected given that this population tends to be in
poorer health and aged over the course of the study.
In spite of this, the good news for the others was that three out of five
reported that their health in 1998–1999 was as good as, or better than, four
years before. Additionally, a large proportion of residents had a social life that
was at least as active as previously. For example, almost four in five of those
with close family had contact at least as often with one family member as they
did before they moved into a residential facility.
93
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
54 Rising Spending on Residential Care
Residential care facilities
are a unique part of Canada’s
health system. Canada’s
hospitals are largely funded
by public monies; they tend
to be owned publicly or by
not-for-profit institutions.
Doctors’ offices are typically
privately owned and operated, although most
services are paid for from
public funds. Residential care
facilities, on the other hand,
have a complex mix of
public and private ownership
and funding.
$350
$300
$250
$200
$150
$100
$50
$0
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
In 2004, Canadians paid
$12 billion, or about $390
per person, for residential
care. Private sources, mostly
out-of-pocket payments,
accounted for about 27%
of this amount, with the
remaining 73% coming
from the public sector.
$ per Person
Spending on
Residential Care
Spending per person on residential care has increased significantly over
time. Overall, it’s up almost 63% since 1994. Growth in public-sector
spending (up 72%) outpaced that in the private sector (up 44%) over
this period.
Public Spending
Private Spending
Note: Data for 2003 and 2004 are forecast.
Source: National Health Expenditure Database, CIHI.
55 Spending on Residential Care Across Canada
Some parts of the country spend much more per person on residential care
than others. The mix of public and private financing also differs. In 2004, for
example, Newfoundland and Labrador’s public sector spent over $665 per
person (roughly 90% of spending in this category) on residential care. In
comparison, this figure was $178 (also approximately 90% of spending)
Nunavut. Private-sector spending varied from just over $20 per person
in Nunavut to $328 in the Yukon. Differences in spending may reflect
variations in the age distribution coverage or co-insurance across the
provinces and territories.
$900
$800
$600
$500
$400
$300
$200
$100
Public
Nun.
Canada
N. W.T.
Y.T.
N.L.
P.E.I.
N.S.
N.B.
Que.
Ont.
Man.
Sask.
Alta.
$0
B.C.
94
$ per Person
$700
Private
Note: Data for 2004 are forecast.
Source: National Health Expenditure Database, CIHI.
Continuing Care
56
Out-of-Pocket Spending on Residential Care
Often, provincial and territorial governments and residents share
the cost of residential care. In general, governments cover the
costs of nursing and personal care, up to a daily limit. The resident is responsible for the cost of accommodation. Governments
typically set accommodation rates, which apply to all residential
care facilities in their jurisdiction. Daily charges vary across the
country, as shown in the table below
Daily Charge for Standard Accommodation
Minimum (per Day)
Maximum (per Day)
B.C.
$27/day
4
$65/day4
Alta.
$40/day1
$40/day1
Sask.
$29/day4
$54/day4
Man.
$26/day4
$62/day4
Ont.
$49/day1
$49/day1
Que.
$30/day3
$49/day3
N.B.
$118/day*
$174/day*
N.S.
$110/day*
$199/day*
P.E.I.
$45/day
$153/day2
N.L.
$93/day1
$93/day1
Y.T.
$18/day2
$21/day2
N.W.T
$10/day5
$24/day5
Nun.
Under consideration
Under consideration
2
Notes:
1 One charge for all residents.
2 Charge varies with level of care provided to residents.
3 Charge varies with number of beds per room.
4 Range of charges geared to income.
5 Charge varies with age.
*Charges for upgraded accommodation (for example, private rooms)
may factor into these averages, since room rates are set differently
than in other provinces.
More than half of the residential
care facilities in Canada are publicly
owned and operated. But the picture
varies across the country. For example, 95% of residential care facilities in
Saskatchewan are publicly owned and
operated. This compares to just under
one-half (43%) in Ontario. Publicly
owned residential care facilities tend
to be similar to their privately owned
counterparts. They average 84 beds
each, compared with 86 beds in privately owned and operated facilities.12
Home Care Services
Home care is an increasingly important part of the health system. For
some clients, it substitutes for care
in hospital or long-term care facilities.
For other clients, the goal is to remain
independent in their own homes and
communities or to provide preventive
services with a view to reducing longterm care needs. Services may include
home support (such as housekeeping)
and clinical care (such as the administration of intravenous medication).13
The importance of home care was
highlighted in the Ten-Year Plan to
Strengthen Health Care signed by
first ministers in September 2004.
Source: Canadian Health Care Association, 2004.
95
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
The role of home care has expanded in recent years. Experts suggest that
a number of factors are driving this growth. For example, new technology
makes it possible for people to receive certain forms of specialized care at
home rather than in a hospital.14 In addition, many suggest that it may be more
appropriate and inexpensive to provide some services at home rather than in
an acute care environment.15
Use of Home Care Services
Home care programs served almost 1.2 million Canadians in 2003.16 The use of
home care services varies across the provinces and territories. In Nova Scotia,
an estimated 5.9% of the population aged 12 or older received some form of
home care service in 2004, compared to 3.7% in Newfoundland and Labrador.16
Coverage of Home
Care Services
96
Publicly Owned
Overall
N.W.T.
Y.T.
N.L.
P.E.I.
N.S.
N.B.
Ont.
Man.
Sask.
Alta.
B.C.
% of All Facilities
The services covered under public programs vary across the country.
Provinces and territories tend to cover services such as assessment and case
management, nursing care
and home support for eligible
57 The Public/Private Mix
clients. But only some
include prescription drugs
Ownership of residential care facilities varies widely across Canada.
In 2001–2002, almost 60% of facilities in Ontario were privately owned,
and various types of therapy
compared with 5% in Saskatchewan.
in publicly funded home care
programs. If home care
Publicly and Privately Owned/Operated Facilities in Canada
clients would like to have
100
services beyond those
90
covered, they typically have
80
70
to pay for them themselves,
60
either out-of-pocket or
50
through insurance plans.
40
30
Some clients receive publicly
20
funded services but also pay
10
0
out-of-pocket for other home
care services.
Privately Owned
A mix of federal, provincial
Note: Because of differences in reporting, these data do not include Quebec.
and territorial programs, priSource: Residential Care Facilities Survey, Statistics Canada.
vate insurance, user fees and
other out-of-pocket payments
funds home care services. In 2003, over 641,000 Canadians said that they had
received home care services partially or fully covered by public funds in the past
12 months.
Continuing Care
Roughly 726,000 home care
recipients also paid out-of58
pocket for their services. Currently,
very little information is available
about the amount spent by
these individuals.
A Look at Public Home Care
The proportion of residents across the country who received publicly
funded home care depends on the programs available in their region and
other factors. About 65% of home care recipients in Manitoba in 2003
reported that some or all of their care was covered by public funding,
compared to 42% in British Columbia.
The Romanow Commission
summarized the situation as follows:
80%
70%
60%
% Publicly Covered
In most parts of Canada, medical
and nursing services are usually
delivered without charge to
people at home, although the
time professionals spend with
care receivers is quite restricted.
Care receivers often have to
pay fees, however, for personal
care and homemaking services,
and there may be direct charges
or partial payments based
on income for prescription
drugs, medical supplies or
adaptive equipment.17
50%
40%
30%
20%
Total
Territories
N.L.
P.E.I.
N.S.
N.B.
Que.
Man.
Sask.
Alta.
B.C.
0%
Ont.
10%
Source: Canadian Community Health Survey 2004 (Cycle 2.2), Statistics Canada.
59 Home Care Clients
Rate per 100,000 Population (75+)
Utilization of publicly funded home care services varies across Canada.
For 2002–2003, provinces and territories counted the number of individuals
aged 65 or older who received publicly funded home care services delivered
in a home or community setting. These health and support services included
home nursing care, rehabilitation therapy and home support services (which
provide personal assistance with daily activities such as bathing, dressing
and grooming). Rates per 100,000 population aged 75 or older ranged from
11,870 in Nova Scotia to 88,980 in the Northwest Territories.
100
90
80
70
60
50
40
30
20
10
0
B.C.
6
5
Alta. Sask. Man. Ont.
4
N.B.
3
N.S.
7
Notes:
1 Comparisons of N.L. to other jurisdictions
are not recommended, since only home
support is included. Data represent clients
age 65 and over. Information for age 75
and over is not available.
2
It is possible that a small number of
clients in N.L. were counted more than
once.
3
Data are based on the distinct number of
clients that required home care for the
week ending November 6, 2004.
4
It is estimated that 35% of clients were
counted more than once.
5
Excludes home care data for clients living
in First Nations communities.
6
Results for 2003–2004 are available in the
Alberta Health and Wellness Annual
Report, 2003–2004.
7
May be underestimated because some
clients who had received nursing services
only may not have been counted in the
region. Also excludes home care data for
First Nations clients.
8
All numbers are estimates based on quarterly or monthly occupancy reports.
..
Not available: P.E.I. Nunavut, Quebec.
8
Y.T. N.W.T.
Source: Performance Reporting Technical Working Group, 2004.
97
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Spending on Home Care Services
In total, the provinces and territories spent about $3 billion on publicly
funded home care services in 2000–2001.20 That’s over three times the
amount they paid in 1990–1991. Looking even further back, the Romanow
Commission estimated that provincial and territorial government spending
on home care grew by an average of 14% per year between 1980–1981
and 2000–2001. That’s much higher than the 6% growth in hospital spending and the 7% for all provincial and territorial
health expenditures over the same period.21
Assistive Devices
Home care programs and spending vary from
coast to coast. In 2000–2001, provincial government home care spending per person ranged
from $54 in Prince Edward Island to $158 in New
Brunswick.20 The Romanow Commission estimated
that, on average, provinces and territories spend
4% to 5% of their health budgets on home care.
However, New Brunswick, home to the “hospital
without walls” extramural program, allocates close
to 10% of its health care budget to home care. 21
There is also considerable variation internationally in the extent of public support for home care
services. A recent OECD report shows that, relative
to many other countries, Canada’s publicly funded
continuing care programs emphasize long-term
care in institutions, rather than home care.
98
Most countries spend less than 1.5% of GDP on
long-term care, with a range of 0.2% to 3% in 2000.
Canada spent 1.1% that year. Norway and Sweden
spent the most. They also have older populations
with the highest proportion of those aged 80 and
over. As well, the OECD indicates that they offer relatively comprehensive publicly funded services.
Both factors may be important in explaining spending differences; the OECD points out that the relationship between long-term care spending and the
proportion of elderly in the population is weak.
Many home care clients also need assistive
devices. These devices aim to ease the
strain of daily activities at home, at work
or for leisure. They include medical equipment, mobility aids, information technologies, practical daily aids and various
devices designed to cater to individual
tastes and needs.18
To find out the average cost of assistive
devices and supports, Human Resources
Development Canada conducted a survey
in 2003.19 Sample findings based on the
survey results include the following:
Homecare beds
$2,223
Physiotherapy—
assessment
$48 per assessment
Physiotherapy—
therapy session
$39 per hour
Registered nurse
$37 per hour
Registered nurse—
special tasks
$40 per hour
Registered nursing
assistant
$27 per hour
Orderly
$17 per hour
Government programs to support assistive
devices differ across Canada. These programs vary both in the types of devices
covered and the level of coverage available.
Continuing Care
Beyond the Health Care System: Informal Support From
Family and Friends
Although formal home care is key for many Canadians, so is informal support
and care provided by family members, friends, neighbours or others. In 2002,
about 1 million seniors living at home reported receiving such care due to a
long-term health problem. More than a third (39% of women and 46% of men)
received all of their care from informal sources.22 That’s about the same as in
1996, but women were less likely to receive formal care only. Rates dropped
from 31% to 25% between 1996 and 2002.22
The type of care people
seek differs by age. Younger
seniors are more likely to
receive all of their care from
family and other informal
sources. About half (47% of
women and 52% of men) did
so in 2002. By age 75, especially for women, care by
home care programs and
other formal sources tends to
supplement or replace care
by family and friends.
The Sandwich Generation
Informal caregivers—family members,
friends and community networks—play an
important role in providing voluntary homecare support services.13 For the “sandwich
generation,” this can mean raising children
and caring for aging parents or other
dependent relatives at the same time.24
According to a 2002 survey, roughly 30%
of Canadians aged 45 to 64 with unmarried
children under the age of 25 living at home
were also caring for a senior. This translates to about 712,000 individuals.
60 Public-Sector Home Care Spending Across Canada
1990–1991
Canada
Nun.
N.W.T
Y.T.
N.L.
P.E.I.
N.S.
N.B.
Que.
Ont.
Man.
Sask.
Alta.
180
160
140
120
100
80
60
40
20
0
B.C.
$ per Capita
Home care spending per person increased significantly between 1990–1991
and 2000–2001, but varied across the country.
2000–2001
Note: These expenditure estimates have been compiled for the purpose of the home care feasibility study
and should be used with caution. CIHI will continue to refine home care estimates.
Source: National Health Expenditure Database, CIHI.
99
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
A recent Statistics Canada study found that 1.7 million Canadians aged 45
to 64 provided informal care to 2.3 million seniors with a long-term disability or
physical limitation in 2002.23 Although men and women are equally likely to act
as informal caregivers, there are differences in the amount of time spent providing support, as well as the activities that they perform. Women dedicated an
average of 30 hours per month to their caregiving responsibilities, compared to
16 hours for men. Most of the care provided by women (67%) took the form of
“inside activities,” such as housekeeping. Among male caregivers, only 40% of
their time was spent on inside activities.23
While most caregivers reported benefits from their role, caregiving also had
consequences. More than one-third of caregivers aged 45 to 64 said that they
incurred extra expenses due to their caregiving duties (42% of women and 38% of
men). So did 27% of female caregivers 65 years of age or older and 30% of senior
men. Caregiving may also affect work patterns and income. Half (51%) of these
caregivers indicated that occasional relief through respite care would help allow
them to continue providing care.
100
Continuing Care
For More Information
1. Statistics Canada, Deaths, 2002 (Ottawa: Statistics Canada, 2005), [online],
cited from <http://www.statcan.ca/english/freepub/82-221-XIE/2005001/
hlthstatus/deaths2.htm>.
2. Statistics Canada, Deaths, 2001 (Ottawa: Statistics Canada, 2003), [online],
cited from <http://www.statcan.ca/english/freepub/84F0211XIE/2001/index.htm>.
3. Statistics Canada, Canadian Statistics—Life Expectancy at Birth (Ottawa:
Statistics Canada, 2000).
4. Canadian Institute for Health Information, Development of National Indicators
and a Reporting System for Continuing Care (Long Term Care Facilities)
Phase One Indicator Definitions and Data Sources (Ottawa: CIHI, 2000),
[online], cited April 26, 2005, from <http://secure.cihi.ca/cihiweb/en/
downloads/indicators_contcare_e_CCIndctr.pdf>.
5. Alberta Long Term Care Association, Facts About Continuing Care in Alberta
(2004), [online], last modified 2004, cited July 11, 2005, [online], last modified in 2004, from <http://longtermcare.ab.ca/home/continuing_care.htm>.
6. Canadian Institute for Health Information, Provincial and Territorial
Government Health Expenditure by Age Group, Sex and Major Category:
Recent and Future Growth Rates (Ottawa: CIHI, 2005).
7. Statistics Canada, 2001 Census: Collective Dwellings (Ottawa: Statistics
Canada, 2001), [online], cited from <http://www12.statcan.ca/english/
census01/products/analytic/companion/coll/pfd/96F0030XIE2001004.pdf>.
8. Statistics Canada, The People: Home Care (2003), [online], last modified
2003, cited July 11, 2005, from <http://142.206.72.67/02/02b/02b_008d_e.htm>.
9. Statistics Canada, “Data Releases: Synopses of Recent Health Information
Produced by Statistics Canada,” Health Reports 15, 2 (2004).
10. Canadian Health Care Association, Nomenclature for Facility-Based
Long-Term Care (2004), [online], last modified 2004, cited April 26, 2005,
from <www.cha.ca/documents/nomenclature.pdf>.
101
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
11. Statistics Canada, “National Population Health Survey, Residents of Health
Care Institutions 1998–1999,” The Daily (December 15, 2000): [online],
cited July 11, 2005, from <http://www.statcan.ca/Daily/English/001215/
d001215d.htm>.
12. Statistics Canada, Residential Care Facilities Survey (Ottawa: Statistics
Canada, 2002).
13. M. Hollander and N. Chappell, Final Report of the National Evaluation of the
Cost-Effectiveness of Home Care: A Report Prepared for the Health Transition
Fund, Health Canada (Victoria, B.C.: National Evaluation of the CostEffectiveness of Home Care, 2002), [online], cited April 26, 2005, from
<http://www.homecarestudy.com/reports/full-text/synthesis.pdf>.
14. K. Wilkins and E. Park, “Home Care in Canada,” Health Reports—Statistics
Canada 10, 1 (1998).
15. M. Hollander, Final Report on the Study on the Comparative Cost Analysis of
Home Care and Residential Care Services: A Report Prepared for the Health
Transition Fund, (Victoria, B.C.: National Evaluation of the Cost-Effectiveness
of Home Care, 2001), [online], cited April 26, 2005, from <http://www.homecarestudy.com/reports/full-text/substudy-01-final_report.pdf>.
16. Canadian Healthcare Association, Charges to Residents in Facility-Based
Long Term Care by Province/Territory, [online], last modidifed 2004, cited
April 26, 2005, from <http://www.cha.ca/documents/Charges%20for%20
LTC%20Care%20Across%20Canada.pdf>.
17. Commission on the Future of Health Care in Canada, Discussion Paper:
Home Care in Canada, (Ottawa: Canadian Health Services Research
Foundation, 2002).
18. Public Health Agency of Canada, Help Yourself to Assistive Devices!
Information for Seniors and Veterans, [online], last modified 2005, cited July
11, 2005, from <http://www.phac-aspc.gc.ca/seniors-aines/pubs/assistive/
assistive1_e.htm>.
102
Continuing Care
19. Human Resources Development Canada, Price Survey of Assistive Devices
and Supports for Persons With Disabilities (Gatineau: Human Resources
Development Canada, 2003).
20. Canadian Institute for Health Information, Monitoring the Feasibility
of Reporting Home Care Estimates in National Health Expenditures,
(Ottawa: CIHI, 2003).
21. Commission on the Future of Health Care in Canada, Building on Values:
The Future of Health Care in Canada (Final Report) Commission on the
Future of Health Care in Canada (Ottawa: Commission on the Future of
Health Care in Canada, 2002), [online], cited April 26, 2005, from
<http://www.hc-sc.gc.ca/english/pdf/romanow/pdfs/HCC_Final_
Report.pdf>.
22. Statistics Canada, Caring for an Aging Society (Ottawa: Statistics Canada,
2005), [online], cited from <http://www.statcan.ca/english/freepub/89-582-XIE/>.
23. S. Stobert and K. Cranswick, “Looking After Seniors: Who Does What for
Whom?” Canadian Social Trends 74 (Fall 2004): pp. 2–6.
24. Statistics Canada, “The Sandwich Generation,” The Daily (September 28,
2004), [online], cited July 11, 2005, from <http://www.statcan.ca/Daily/
English/040928/d040928b.htm>.
103
Canada’s Health System
Financing, Ownership and Delivery
of
S
Pr
iva
y
er
te
es
ic
v
er
Physicians
iv
Oral Health
Eye Care
Private P
ub
l
ic
Home Care
Mental
Health
Services
Residential
Care
Facilities
Source: Adapted from I. McKillop, J. Alpenberg,
R. G. Evans, et al., Private Sector Delivery: Scope
and Extent in Canada’s Health Care System, 2004
(Waterloo: University of Waterloo, 2004).
Mental
Health
Hospitals
Public
Ownership/Operation
l
De
Drugs
10
Public
Private
Source of Funding
Quick Facts
Use
• Roughly 7% of all psychiatric and general hospital admissions in Canada
were primarily due to mental illness and/or addiction in 2002–2003.
• Only 32% of Canadians with symptoms suggesting one of the surveyed
mental disorders or substance dependencies consulted a health
professional for their mental health or addiction problems in 2001.
Coverage
• 47% to 72% (depending on the type of professional consulted)
of Canadians aged 20 or older who consulted a mental health
professional in 2001 reported having some form of government
or private insurance coverage.
Spending
• Mental illnesses were the second-highest source of direct health care
costs in Canada in 1998, after cardiovascular diseases (based on
attributable disease categories).
• The economic cost (direct and indirect) of mental illnesses in Canada was
approximately $14 billion in 1998.
• Average acute care and psychiatric hospital costs per patient were
highest for patients with bipolar disorder ($7,980), schizophrenia ($6,972)
and depression ($5,568) in 2002–2003.
105
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Health Canada estimates that about one in five Canadians suffer from a mental
illness at some point in their life.1 The Global Burden of Disease study conducted
by the World Health Organization, the World Bank and Harvard University reported that mental illness, including suicide, accounted for 11% of the total burden of disease worldwide in 1990. The study estimates that this number will
increase to approximately 15% by 2020 in established market economies, such
as Canada.*
In 1998, based on costs attributable to a disease category, mental disorders
were the second-largest source of direct health care costs in Canada after
cardiovascular diseases.2 Added to this are indirect costs of approximately
$3 billion that reflect mortality and short- and long-term disability. Other factors,
such as under-performance within the workplace or at school, as well as social
consequences, such as stigmatization and social exclusion, may also be
important but are rarely included in economic analyses.
Thanks to a recent Statistics Canada survey, we have better information than
ever before on how often some mental illnesses occur. However, we still have a
limited understanding of the total costs of care and sources of payment. This is
particularly true for care that occurs through formal or informal support networks
and community-based services, as well as care that occurs in conjunction with
treatment for other health conditions. This chapter focuses on what we do know
about utilization, coverage and spending on mental health services, with particular
emphasis on services received in hospitals.
Who Is and Isn’t Using Mental Health Services
Mental illness is common. Some 2.6 million Canadians aged 15 or older
reported symptoms or feelings associated with major depression, mania
disorder, one of three types of anxiety disorders, or dependence on alcohol
or illicit drugs in the year prior to a 2002 Statistics Canada survey.3 That’s
more than 10% of all respondents.
106
Most of those reporting symptoms consistent with the mental disorders or
addictions surveyed said that they had not sought or received professional help.
Only about a third (32%) said that they had consulted a health professional (for
example, a psychiatrist, family physician, medical specialist, psychologist or
nurse) about problems concerning emotions, mental health or use of alcohol
and drugs in the previous year.
* The World Health Organization expresses “disease burden” in disability-adjusted life-years (DALY), which is the sum of years of
potential life lost due to premature mortality and the years of productive life lost due to disability.
Mental Health Services
On the other hand, about one in five (21%) individuals with any of the surveyed mental disorders or substance dependencies said that they had needed
help in the past year, but did not receive it. Respondents reported several reasons for not seeking treatment. Many (34%) of those aged 20 or older stated
that they preferred to manage the problem themselves. About one in five (20%)
also reported that they did not get around to getting help. Only 12% said that
the cost of these services prevented them from getting help.
Was Cost a Factor?
In 2002, Statistics Canada asked Canadians aged 20 or
older who had stopped consulting a health professional
about their mental health and/or addiction problems in
the previous year why they stopped. Many (29% to 53%,
depending on the type of professional consulted) reported
that they had stopped seeing the health professional because
they felt better. The extent to which cost was a factor in their
stopping treatment varied by the type of professional consulted, as shown in the table below.
Type of Health
Professional Consulted
% of Respondents Who Said
They Stopped Because They
Couldn’t Afford the Service
Family physician/GP
2
Psychiatrist
6
Psychologist
6
Nurse
0
Social worker/counsellor
4
Spiritual/religious advisor
0
Other MD*
6
Other professionals**
16
Notes: * “Other MD” refers to cardiologists, gynaecologists, urologists and allergists, among others.
** “Other professionals” refers to acupuncturists, chiropractors, herbalists, hypnotists and other
complementary and alternative professionals.
Source: Canadian Community Health Survey (Cycle 1.2) Mental Health and Well-Being, Statistics
Canada, 2002.
Individuals who did receive
treatment for their mental health
and/or substance dependence
problem used a wide variety of
services. For most Canadians
living with mental illness, their
first—and often only—contact
with the health system is with a
family physician.1 Today’s doctors tend to provide a different
mix of services than in the past.
In 2001, 85% of family doctors
were providing mental health
counselling in their offices—up
from 82% in 1992.4
The extent to which
Canadians use mental health
services varies by age and other
factors. For example, although
mental health or substance problems are more common among
those 15 to 24 years of age than
among older adults, fewer 15-to24-year-olds reported having
used mental health services in
the 2002 survey. Only onequarter of people in this age
group reporting symptoms consulted with a health professional
or used some type of resources,
compared to 32% overall.3
107
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
According to Statistics Canada, men and women are equally likely to report
symptoms of selected mental health problems or substance dependence.
However, there are differences in the types of mental health problems they
report. Across all age groups, over 22% of women reported that they needed
help for their mental health and substance use problems, but did not receive it,
while less than 20% of men
reported unmet needs. Only
61 Who Do Canadians Consult About
9% of seniors aged 65 or
Their Mental Health Problems?
older reported having unmet
In 2003, one-quarter (25%) of Canadians with selected mental health
needs for mental health
problems reported that they had spoken with a physician (that is a GP,
resources. This is lower than
psychiatrist or other MD) in the previous year about the problem.
Consultations with other types of professionals were less common.
the 21% reported overall.
108
18
% of Respondents Who Have Seen a Health
Professional in the Last Year
Although most care for
mental illness is provided in the
community, some Canadians
require overnight care. In
2002–2003, about 7% of all
psychiatric and general hospital admissions were cases
with a primary diagnosis of
mental illness and/or addiction.6 This translated to a rate
of about 600 hospital stays per
100,000 population. Across the
country, rates varied between
606 per 100,000 in Quebec to
1,274 per 100,000 in Prince
Edward Island in 2002–2003.
Several factors may contribute
to these variations, including
demographic differences, population health, how care is organized
and delivered as well as the
availability and accessibility
of resources in the community
and in hospital.
16
14
12
10
8
6
4
2
0
GP
Psychologist Psychiatrist
Other MD
Nurse
Other*
Note: *”Other” refers to acupuncturists, chiropractors, herbalists, hypnotists and other
complementary and alternative professionals.
Source: Canadian Community Health Survey (Cycle 1.2),
Mental Health and Well-Being, Statistics Canada, 2003.
A Focus on Manitoba
Researchers in Manitoba5 found that people
living with mental illness used more than twice as
many health services as the rest of the Manitoba
population between 1997–1998 and 2001–2002.
Most of this care was not primarily for their
mental illness. Only about 1 in 5 physician visits
and 1 in 10 hospital visits were primarily for
mental illness.
The researchers also showed that, while those
living in lower-income areas had the highest
treatment rate for mental illness, those in
higher-income areas were more likely to receive
treatment from psychiatrists. While the most
frequent users of psychiatric services were people aged 35 to 55, those over 60 were the most
frequently diagnosed with mental illness.
Mental Health Services
The rates of admission, as well as the number of hospital days due primarily
to mental illness and/or addiction, are falling. The 2002–2003 admission rate of
606 per 100,000 population is significantly less than the 1973 rate of 894 per
100,000. In total, overnight stays primarily for mental illness and/or addiction
accounted for about 7.8 million days of care in general and psychiatric hospitals
in 2002–2003, versus 8.2 million in 2001–2002.
Most admissions for mental illness occur in general hospitals. In 2002–2003,
there were 525 admissions primarily due to mental illness and/or addiction to
general hospitals for every 100,000 people, compared to only 81 admissions to
psychiatric hospitals (about 13% of the total). However, those admitted to psychiatric hospitals tended to have much longer stays. Patients in these hospitals
stayed an average of 140 days, compared to 26 days for general hospitals.
Who’s Paying for Mental Health Care?
The Canada Health Act covers “medically necessary” inpatient and outpatient
mental health services, including those provided by physicians (including
psychiatrists). For example, in 2002–2003, fee-for-service payments to physicians
for psychotherapy or counselling services amounted to roughly $733 million.7
That represents 8% of total physician fee-for-service payments.**
The Canada Health Act does not mandate public coverage of mental health
services outside of hospitals, but all the provinces and territories have elected
to cover them to varying degrees. Across the country, health insurance plans
do not tend to cover services by allied health professionals such as psychologists and social workers, but a province or territory may pay for some care
through other programs (for example, social assistance and child welfare).8
As a result, some services are paid for by public funds, while others are
not. In 2002, Statistics Canada asked individuals who had had contact with a
health professional about problems with their emotions, mental health or
use of alcohol or drugs whether these services were covered through private,
government or employee-paid insurance plans. The extent of coverage depended on the type of health professional consulted. More than half of those who
consulted a psychologist, nurse, social worker or counsellor (61% to 72%) said
that their care was fully or partly covered. Fewer of those who consulted other
professionals (47%) had at least some coverage.
109
** Fee-for-service payments include all billings from any location (such as a hospital, private office or nursing home), but do not include
services provided by salaried physicians.
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
The Cost of Mental Health Care
Health Canada estimates that about $4.7 billion of Canada’s direct health care
costs in 1998 went towards care for mental disorders.2 Although most care for
mental illness occurs in the community, hospitals accounted for $2.7 billion of
this total. Drugs ($1.1 billion) and physician care ($0.9 billion) accounted for the
majority of the remaining direct costs.
Cost per Patient ($)
Another study calculated cost estimates for non-medical mental health
services and lost productivity due to short-term disability, and estimated the total
to be $14.4 billion.9 This study incorporated data from the 1996–1997 National
Population Health Survey on depressed and distressed persons aged 12 or
older who made publicly and non-publicly insured visits to social workers and
psychologists. Direct costs for treating diagnosed mental disorders were roughly
$6.3 billion, and indirect costs related to lost productivity and premature death
totalled $8.1 billion. The vast majority (96%) of direct costs included in this study
were for publicly insured
services. The remaining 4% of
62 How Much Are Hospitals Spending
direct costs (or $278 million)
for Mental Health Illnesses?
were for the non-publicly
Some mental health problems are more expensive to treat than others.
insured 3 million visits to
Among patients of all ages hospitalized in acute, sub-acute and psychiatric
psychologists and social workers
facilities primarily for mental illness and/or addiction, the average cost of an
admission in 2002–2003 was highest for bipolar patients ($7,980). Next most
that took place on a fee-forexpensive was treatment for patients with schizophrenia ($6,972) or depresservice basis outside institusion ($5,568). Of note is that in all cases, these costs are averages for typical
patients and do not include cases where patients died, were transferred,
tions. This amount may reflect
signed out against medical advice or had unusually long hospital stays.
the out-of-pocket spending by
10,000
patients for these visits, but
9,000
little data exists about the
8,000
extent of private insurance
7,000
6,000
coverage. These figures may
5,000
also underestimate spending,
4,000
because only selected mental
3,000
disorders were studied, and
2,000
spending on over-the-counter
1,000
0
medications and for other commuCanada
nity services were not included.
Bipolar
110
Schizophrenia
Depression
The 2002 Canadian
Notes: Includes all patients admitted in acute, sub-acute and psychiatric care hospitals and for whom the
most responsible diagnosis was a mental illness. Does not include data from Quebec and the territories.
Community Health Survey
Source: Canadian MIS Database and Discharge Abstract Database, CIHI.
(CCHS) found that roughly 92%
of Canadians aged 20 or older reported no out-of-pocket spending for services
or products to help them with their mental health or addiction problems over
the 12 months prior to the survey. About 8% said that they had spent less than
$5,000 out-of-pocket, while 0.1% had spent $5,000 or more.
Mental Health Services
For More Information
1. Health Canada, A Report on Mental Illnesses in Canada (Health Canada,
2002), pp. 2–30, [online] from <http://www.phac-aspc.gc.ca/publicat/
miic-mmac/pdf/men_ill_e.pdf>.
2. Health Canada, Economic Burden of Illness in Canada, 1998
(Ottawa: Health Canada, 2002).
3. Statistics Canada, Canadian Community Health Survey: Mental Health and
Well-Being (Ottawa: Statistics Canada, 2003).
4. Canadian Institute for Health Information, The Evolving Role of Canada’s
Family Physicians, 1992–2001 (Ottawa: CIHI, 2004).
5. University of Manitoba, Mental Illness in Manitoba: A Guide for RHA
Planners, last modified 2004, [online], cited October 12, 2004, from
<http://www.umanitoba.ca/centres/mchp/reports/reports_04/mental.health.htm>.
6. Canadian Institute for Health Information, Release of Hospital Mental Health
Statistics, 2002–2003 (Ottawa: CIHI, 2005).
7. Canadian Institute for Health Information, National Grouping System
Categories Report, Canada, 2002–2003 (Ottawa: CIHI, 2005).
8. American Psychiatric Association, Canadian System Built on Sharing
Costs, Power, last modified 2003, [online], cited March 14, 2005, from
<http://pn.psychiatryonline.org/cgi/content/full/38/19/25>.
9. T. Stephens and N. Joubert, The Economic Burden of Mental Health
Problems in Canada (Public Health Agency of Canada, 2001), [online],
cited February 28, 2005, from <http://www.phac-aspc.gc.ca/publicat/
cdic-mcc/22-1/d_e.html>.
111
Canada’s Health System
Financing, Ownership and Delivery
Pr
iva
Physicians
Drugs
Home Care
CAM
Oral Health
Eye Care
Residential
Care
Facilities
Source: Adapted from I. McKillop, J. Alpenberg,
R. G. Evans, et al., Private Sector Delivery:
Scope and Extent in Canada’s Health Care
System, (Waterloo: University of Waterloo, 2004).
Mental
Health
Hospitals
Public
Ownership/Operation
D
S
Complementary
and Alternative
Medicine
Private P
ub
l
iv
el
of
ic
y
er
te
es
ic
v
er
11
Public
Private
Source of Funding
Quick Facts
Use
• 3.3 million Canadians aged 12 or older reported having consulted with
a complementary and alternative medicine practitioner in the year prior
to the 2003 Survey.
• 75% of Canadians aged 15 or older reported using one or more natural
health products in 2001.
Coverage
• Public health insurance plans in Manitoba, Saskatchewan and Alberta
partially cover chiropractic services.
• British Columbia’s public health insurance partially covers naturopathy
provided by naturopathic physicians.
• Private health insurance coverage for these and other services varies
across the country.
Spending
• Researchers estimate that $3.8 billion was spent on complementary
and alternative therapies in 1997.
113
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
For centuries, echinacea was used by Native Americans to fight off infections;
women in Ancient Greece used Queen Anne’s lace as a contraceptive; and
people in China took ginkgo to prevent deterioration of the mind.1
People have used natural remedies for treating ailments and diseases
for thousands of years, well before the first hospital walls were built. Today,
Canadians rely on both traditional and new therapies. Massage therapy, traditional Aboriginal and Chinese medicine, homeopathy and herbal products are
examples of healing practices and products that are used along with (complementary to) or instead of (alternatives for) conventional medical treatment.2
Currently, a growing number of people use natural health products or consult
with providers of complementary and alternative therapies.
Canadians pay out-of-pocket for most of these services and products, since
public and private health insurance plans tend to provide only limited coverage.3
However, despite the growing popularity of these services, little is known about
rates of utilization or related costs and spending.
Seeking Care Outside the Doctor’s Office
Many Canadians substitute or supplement the array of services provided
by hospitals and doctors.
A 2003 Statistics Canada survey estimated that 3.3 million Canadians (12% of
the population) aged 12 or older had used the services of complementary and
alternative (CAM) care providers in the year prior to the survey, up from 5% in
1994-1995.4 Massage therapists were most often consulted (8%), followed
by acupuncturists (2%) and homeopaths or naturopaths (2%).5 In a separate
survey question, 11% of CAM users reported consulting a chiropractor.
The use of complementary and alternative therapists is highest in Western
Canada.5 Other groups who are more likely to visit a chiropractor or other
complementary and alternative care provider include:
•
•
•
•
114
Females (almost twice as likely as males)
People who are middle-aged
People with higher incomes and more education
People with chronic health conditions, such as cancer or heart disease6
Complementary and Alternative Medicine
63 What Type of Services Are Canadians Using?
A 2003 Statistics Canada survey estimated that 3.3 million Canadians (12%
of the population) aged 12 or older had used the services of complementary
and alternative (CAM) care providers in the year prior to the survey, up from
5% in 1994–1995.4 Massage therapists were most often consulted (8%),
followed by acupuncturists (2%) and homeopaths or naturopaths (2%).5
In a separate survey question, 11% of CAM users reported consulting
a chiropractor.
Massage Therapist
Acupuncturist
Homeopath or Naturopath
Chiropractor
Other Alternative Health
Care Provider
0
2
4
6
8
10
12
Percent of Canadians Who Consulted
a CAM Health Practitioner in the Last Year (%)
Notes: “Other alternative health care provider” includes Feldenkrais or Alexander teachers,
relaxation therapists, biofeedback teachers, Rolfers, herbalists, reflexologists, spiritual or
religious healers and other alternative health care providers.
Source: Canadian Community Health Survey (Cycle 2.1), Statistics Canada, 2003.
The use of natural health products—such as herbal remedies,
homeopathic medicines, vitamins, minerals and much more—is
also common. For example, Statistics Canada found that over
one-third (38%) of Canadians who treated their cold or flu symptoms themselves in 1998–1999 reported that they used herbal
or vitamin supplements. Another quarter (26%) reported using
home remedies.
Similar to findings about the use of complementary and alternative care providers, the use of natural health products is also
more common in Western Canada. According to the 2001 Berger
Population Health Monitor survey, British Columbia had the highest use: 41% of respondents reported using three or more natural
health products in the previous six months.7 Those living in the
Atlantic provinces reported the lowest use (15%). The average for
Canada as a whole was 31%.
Over the years, more Canadians are reporting that they take
natural health products instead of a drug prescribed by a physician. In the 2001 Berger Population Health Monitor Survey, roughly
7% said that they did so, up from 2% in 1999. Additionally, the
number of Canadians who reported substituting a natural health
product for over-the-counter medication doubled from 15% in
1998 to 30% in 2000.7
115
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
64 Who Uses the Most CAM Services?
Overall, 13% percent of Canadian adults aged 20 or older reported visiting
some type of complementary of alternative health care provider in the year
prior to the 2003 Canadian Community Health Survey. Those living
in Western Canada reported the highest rates of CAM use.
.
Canada
12%
13%
13%*
13%
16%*
14%*
5%*
13%
13%
7%*
11%*
16%*
7%*
8%*
Note: *Statistically significantly different from the Canadian rate (p = 0.05).
Source: Canadian Community Health Survey (Cycle 2.1), Statistics Canada, 2003.
65 Use of Natural Health Products
In March 2001, more than 7 in 10 Canadians aged 15 or older reported using
one or more natural health products six months prior to survey. For example,
almost 40% reported using herbal remedies in 2001, up from 30% in 1999.
Vitamins
Herbal Remedies
March 2001
Iron, Calcium and Other
Mineral Supplements
May 2000
March 1999
Food and Other
Supplements
Homepathic Remedies
116
0%
10%
20%
30%
40%
50%
60%
70%
Percent of Respondents (%)
Notes: The rates for selected types of products (shown above) are estimated to be
correct within 2 percentage points, 19 times out of 20.
Source: E. Berger, The Berger Population Health Monitor (Toronto, 2001).
Complementary and Alternative Medicine
Coverage for CAM
Most Canadians pay out-of-pocket for many complementary and alternative medical services and therapeutic products. Chiropractic and naturopathic services are
the two services most likely to be covered under public health insurance. In 2004,
Ontario delisted chiropractic services, but Manitoba, Saskatchewan and Alberta
continue to partially insure them.8, 9 British Columbia also partially covers naturopathy provided by physicians.10 In some cases, private health insurance offers partial
or full coverage for chiropractic services, naturopathy, acupuncture, homeopathy
and/or massage therapy. In general, such coverage tends to be limited and varies
considerably across insurance plans.
Spending
Very little information is available about spending on complementary and alternative therapies and natural health products. A 1997 study estimated that Canadians
spent $3.8 billion on complementary and alternative care.3 This money paid for
fees to service providers ($1.8 billion) and other resources, such as books, medical equipment, herbs, vitamins and special diet programs.
117
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
For More Information
1. J. Challem, Why Herbs Work (2000), [online], cited July 13, 2005, from
<http://www.thenutritionreporter.com/why_herbs_work.html>.
2. National Centre for Complementary and Alternative Medicine, What
Is Complementary and Alternative Medicine (CAM)? (National Centre
for Complementary and Alternative Medicine, 2005), pp. 1–5, [online],
cited February 27, 2005, from <http://www.nccam.nih.gov/health/
whatiscam.com>.
3. C. Ramsay, M. Walker and J. Alexander, Alternative Medicine In Canada: Use
and Public Attitudes, ed. K. McCahon (Vancouver, B.C.: The Fraser Institute,
2001), pp. 3–31.
4. Statistics Canada, Community and Health System Characteristics: Contact
With Alternative Health Care Providers, by Age Group and Sex, Household
Population Aged 12 and Over, Canada, 2003 (2004), [online], cited July 22,
2005, from <http://www.statcan.ca/english/freepub/82-221-XIE/2005001/
tables/html/4267_03.htm>.
5. Statistics Canada, Health Reports: Use of Alternative Health Care (2003),
[online], cited May 26, 2005, from <http://www.statcan.ca/Daily/Enlish/
050315/d05031b.htm>.
6. W. J. Miller, Patterns of Use—Alternative Health Care Practitioners (Ottawa:
Statistics Canada, 2001), pp. 9–21.
7. T. de Bruyn, A Summary of National Data on Complementary and Alternative
Health Care—Current Status and Future Development: A Discussion Paper
(Health Canada, 2002).
8. Canadian Chiropractic Association, Provincial Health Plan Coverage:
Covered by Four Provincial Health Plans (2005), [online], cited
February 28, 2005, from <http://www.ccachiro.org/client/cca/cca.nsf/
web/Provincial%20Health%20Plan%20Coverage?OpenDocument>.
118
9. ChiroWeb.com, Ontario Removes Chiropractic From Provincial Health Plan
(2004), [online], cited July 12, 2005, from <http://www.chiroweb.com/
archives/22/14/06.html>.
10. York University Centre for Health Studies, Complementary and Alternative
Health Practices and Therapies—A Canadian Overview (Toronto: Health
Canada, 1999).
Appendix
National Health Expenditure Trends Data Tables
Table A.2.1
Total Health Expenditure by Source of Finance, Canada,
1975 to 2004—Current Dollars ($’ 000,000)
120
Table A.2.3
Total Health Expenditure by Source of Finance, Canada,
1975 to 2004—Current Dollars Per Capita
121
Table A.3.1.1
Total Health Expenditure by Use of Funds, Canada,
1975 to 2004—Current Dollars ($’ 000,000)
122
Table A.3.2.1
Private-Sector Health Expenditure by Use of Funds, Canada,
1975 to 2004—Current Dollars ($’ 000,000)
124
Table A.3.3.1
Public-Sector Health Expenditure by Use of Funds, Canada,
1975 to 2004—Current Dollars ($’ 000,000)
126
Table B.1.1
Total Health Expenditure, by Province/Territory and Canada,
1975 to 2004—Current Dollars ($’ 000,000)
128
Table B.1.2
Total Health Expenditure, by Province/Territory and Canada,
1975 to 2004—Current Dollars Per Capita
129
Source: Adapted from National Health Expenditure Trends 1975 to 2004, by the Canadian Institute for Health Information, Ottawa, 2004.
119
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Table A.2.1
Total Health Expenditure by Source of Finance,
Canada, 1975 to 2004—Current Dollars
Provincial
Government
Federal
Direct
Municipal
Government
A
B
C
Year
120
Social
Security
Funds
D
($’ 000,000)
Total of
Public
Sector
A+B+C+D
Private
Sector
Total
F
E+F
E
G
1975
1976
1977
1978
1979
8,709.3
10,129.9
11,102.0
12,269.4
13,696.6
398.3
439.7
475.2
485.6
512.8
71.6
105.8
114.2
111.7
156.0
121.1
141.9
153.1
173.8
186.8
9,300.3
10,817.2
11,844.6
13,040.5
14,552.3
2,899.2
3,232.6
3,605.4
4,066.3
4,617.4
12,199.4
14,049.8
15,450.0
17,106.8
19,169.7
1980
1981
1982
1983
1984
15,794.0
18,655.5
22,002.1
24,510.1
26,243.9
582.1
692.7
854.8
994.9
1,106.1
234.0
275.4
250.8
222.2
214.5
231.7
319.0
339.1
352.7
392.3
16,841.8
19,942.6
23,446.8
26,080.0
27,956.9
5,456.5
6,334.1
7,312.3
7,958.6
8,786.3
22,298.4
26,276.7
30,759.1
34,038.6
36,743.1
1985
1986
1987
1988
1989
28,202.8
30,501.5
32,821.9
35,806.2
39,332.1
1,157.7
1,260.8
1,349.7
1,522.8
1,686.6
273.1
310.2
404.6
303.5
326.4
461.3
456.2
478.5
530.3
566.0
30,094.9
32,528.6
35,054.7
38,162.8
41,911.1
9,746.9
10,808.7
11,733.5
12,796.4
14,184.3
39,841.7
43,337.3
46,788.2
50,959.2
56,095.5
1990
1991
1992
1993
1994
42,469.7
46,176.8
48,337.8
48,572.6
48,885.6
1,970.4
2,110.0
2,199.9
2,280.9
2,519.8
364.6
374.7
396.9
383.7
446.1
640.8
720.8
759.1
742.5
747.2
45,445.5
49,382.2
51,693.8
51,979.7
52,598.7
15,577.1
16,906.9
18,112.0
19,578.1
20,486.8
61,022.6
66,289.1
69,805.7
71,557.7
73,085.4
1995
1996
1997
1998
1999
48,936.4
49,095.6
50,904.3
54,193.6
58,374.6
2,667.0
2,606.3
2,827.2
3,026.7
3,152.8
394.9
348.1
318.7
765.4
582.6
792.4
827.1
951.4
1,047.0
1,174.8
52,790.6
52,877.1
55,001.5
59,032.8
63,284.8
21,285.3
21,819.7
23,433.8
24,706.8
26,621.9
74,075.9
74,696.8
78,435.3
83,739.6
89,906.6
2000
2001
2002
2003 f
2004 f
63,284.3
68,047.3
72,828.3
78,804.9
83,427.6
3,614.5
4,258.7
4,279.5
4,508.6
4,737.5
688.3
803.1
873.5
981.6
1,035.5
1,370.7
1,480.5
1,557.8
1,738.6
1,853.2
68,957.9
74,589.7
79,539.1
86,033.7
91,053.7
28,945.5
31,721.1
34,502.5
36,970.0
39,221.5
97,903.4
106,310.8
114,041.6
123,003.7
130,275.2
f = forecast
CIHI 2004
Appendix
Table A.2.3
Total Health Expenditure by Source of Finance,
Canada, 1975 to 2004—Current Dollars
Provincial
Government
Federal
Direct
Municipal
Government
Social
Security
Funds
Total of
Public
Sector
Private
Sector
Total
A
B
C
D
A+B+C+D
F
E+F
Year
($’ per Capita)
E
G
1975
1976
1977
1978
1979
376.32
431.98
467.93
512.01
565.93
17.21
18.75
20.03
20.26
21.19
3.10
4.51
4.81
4.66
6.45
5.23
6.05
6.45
7.25
7.72
401.86
461.29
499.22
544.19
601.29
125.27
137.85
151.96
169.69
190.79
527.13
599.14
651.19
713.87
792.08
1980
1981
1982
1983
1984
644.23
751.62
875.97
966.22
1,024.85
23.74
27.91
34.03
39.22
43.20
9.54
11.10
9.99
8.76
8.38
9.45
12.85
13.50
13.90
15.32
686.97
803.48
933.49
1,028.11
1,091.74
222.57
255.20
291.12
313.74
343.11
909.54
1,058.67
1,224.61
1,341.85
1,434.85
1985
1986
1987
1988
1989
1,091.32
1,168.59
1,240.96
1,336.28
1,441.70
44.80
48.30
51.03
56.83
61.82
10.57
11.88
15.30
11.33
11.97
17.85
17.48
18.09
19.79
20.75
1,164.54
1,246.25
1,325.38
1,424.23
1,536.23
377.16
414.11
443.63
477.56
519.92
1,541.70
1,660.36
1,769.01
1,901.79
2,056.15
1990
1991
1992
1993
1994
1,533.34
1,647.32
1,704.03
1,693.50
1,685.76
71.14
75.27
77.55
79.52
86.89
13.16
13.37
13.99
13.38
15.38
23.13
25.71
26.76
25.89
25.76
1,640.78
1,761.68
1,822.33
1,812.29
1,813.80
562.40
603.14
638.49
682.59
706.46
2,203.18
2,364.82
2,460.82
2,494.88
2,520.26
1995
1996
1997
1998
1999
1,670.06
1,658.03
1,702.06
1,797.02
1,919.97
91.02
88.02
94.53
100.36
103.70
13.48
11.75
10.66
25.38
19.16
27.04
27.93
31.81
34.72
38.64
1,801.59
1,785.73
1,839.06
1,957.48
2,081.47
726.40
736.88
783.55
819.26
875.61
2,527.99
2,522.61
2,622.61
2,776.74
2,957.08
2000
2001
2002
2003 f
2004 f
2,062.12
2,193.57
2,321.40
2,489.06
2,611.49
17.78
137.28
136.41
142.41
148.30
22.43
25.89
27.84
31.00
32.41
44.67
47.73
49.65
54.92
58.01
2,246.99
2,404.47
2,535.30
2,717.39
2,850.21
943.19
1,022.56
1,099.77
1,167.70
1,227.73
3,190.17
3,427.03
3,635.07
3,885.09
4,077.94
f = forecast
CIHI 2004
121
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Table A.3.1.1
Total Health Expenditure by Use of Funds,
Canada, 1975 to 2004—Current Dollars
Hospitals
Other
Institutions
Physicians
Other Professionals
Dental
Services
Year
A
B
Vision
Care
Services
Other
C
Sub-Total
D
($’ 000, 000)
122
1975
1976
1977
1978
1979
5,454.9
6,357.3
6,792.8
7,382.0
8,114.1
1,125.0
1,368.6
1,577.0
1,851.8
2,171.7
1,839.9
2,071.0
2,284.4
2,566.7
2,857.1
741.7
869.1
1,034.6
1,191.3
1,374.5
226.1
260.1
295.8
336.0
365.8
128.4
145.5
162.6
186.3
219.2
1,096.2
1,274.7
1,493.0
1,713.5
1,959.5
1980
1981
1982
1983
1984
9,334.4
11,030.7
13,092.8
14,417.6
15,344.8
2,539.6
2,889.9
3,384.8
3,741.6
3,915.5
3,287.5
3,824.8
4,420.8
5,052.7
5,525.9
1,592.0
1,811.8
2,072.7
2,225.7
2,402.3
414.4
513.6
609.8
715.0
829.4
255.4
303.7
357.3
411.6
452.2
2,261.7
2,629.1
3,039.8
3,352.4
3,683.8
1985
1986
1987
1988
1989
16,260.3
17,637.2
18,951.1
20,400.3
22,270.1
4,105.9
4,087.3
4,329.2
4,738.7
5,141.3
6,045.7
6,674.8
7,342.8
7,942.1
8,506.7
2,711.3
2,959.6
3,203.6
3,494.0
3,820.7
925.9
1,002.2
1,075.6
1,184.2
1,302.3
496.4
562.0
634.3
715.6
833.8
4,133.6
4,523.8
4,913.5
5,393.8
5,956.7
1990
1991
1992
1993
1994
23,866.4
25,714.9
26,667.2
26,739.5
26,165.6
5,748.2
6,344.9
6,787.8
6,796.3
6,921.6
9,245.1
10,205.5
10,448.5
10,498.9
10,731.6
4,139.0
4,467.5
4,690.2
4,926.9
5,217.1
1,402.7
1,484.8
1,535.0
1,587.0
1,683.0
956.6
1,082.7
1,171.6
1,220.4
1,253.7
6,498.3
7,035.0
7,396.8
7,734.3
8,153.8
1995
1996
1997
1998
1999
25,499.8
25,206.4
25,759.9
27,082.1
28,207.9
7,152.8
7,305.2
7,591.0
7,983.2
8,622.9
10,638.0
10,758.8
11,176.6
11,715.7
12,223.5
5,485.2
5,663.4
5,895.8
6,278.4
6,774.6
1,774.4
1,830.1
2,188.3
2,275.3
2,346.3
1,295.7
1,336.7
1,543.1
1,528.0
1,725.3
8,555.3
8,830.2
9,627.3
10,081.7
10,846.1
2000
2001
2002
2003 f
2004 f
30,554.5
32,199.0
34,375.1
36,808.7
38,896.8
9,331.3
10,104.7
10,776.5
11,547.6
12,456.1
12,977.0
13,978.0
15,050.7
16,012.6
16,785.2
7,205.5
7,803.1
8,279.7
8,784.3
9,267.5
2,574.2
2,751.2
2,794.2
2,945.4
3,089.2
1,806.9
2,022.4
2,042.9
2,161.4
2,278.9
11,586.6
12,576.7
13,116.8
13,891.0
14,635.6
f = forecast
CIHI 2004
Appendix
Drugs
Prescribed
Drugs
NonPrescribed
Drugs
Other Health Spending
Sub-Total
E
Capital
F
Public
Health and
Administration
Prepayment
Administration
Health
Research
Other
G
Sub-Total
Grand
Total
H
A+B+C+
D+E+F+
G+H
($’ 000, 000)
771.7
883.4
987.9
1,052.7
1,162.9
305.6
316.0
324.5
392.8
495.5
1,077.3
1,199.4
1,312.4
1,445.5
1,658.4
536.1
544.1
563.7
672.2
725.1
551.1
638.2
727.4
726.7
817.8
172.1
200.4
234.3
237.0
268.0
93.7
105.4
129.4
150.4
173.7
253.2
290.6
335.4
360.9
424.2
519.0
596.4
699.1
748.3
865.9
12,199.4
14,049.8
15,450.0
17,106.8
19,169.7
1,298.4
1,677.1
1,924.1
2,107.1
2,255.6
586.3
655.0
715.0
845.9
1,058.6
1,884.6
2,332.1
2,639.1
2,953.0
3,314.2
990.7
1,111.2
1,394.8
1,436.6
1,504.1
963.8
1,133.8
1,333.0
1,444.7
1,604.6
294.7
383.9
369.1
396.9
482.4
202.5
231.2
258.0
297.3
336.9
538.7
710.1
826.9
945.8
1,030.8
1,035.9
1,325.2
1,454.0
1,640.0
1,850.1
22,298.4
26,276.7
30,759.1
34,038.6
36,743.1
2,566.5
3,018.0
3,293.1
3,736.8
4,262.9
1,235.9
1,399.0
1,621.7
1,784.9
1,975.6
3,802.3
4,417.1
4,914.9
5,521.7
6,238.5
1,651.2
1,801.4
1,871.8
1,901.7
2,092.8
1,788.6
1,835.6
1,942.3
2,055.3
2,258.3
503.6
570.4
576.5
738.3
987.7
381.2
452.8
452.0
507.1
588.4
1,169.4
1,336.8
1,494.2
1,760.2
2,055.0
2,054.2
2,360.1
2,522.7
3,005.6
3,631.0
39,841.7
43,337.3
46,788.2
50,959.2
56,095.5
4,871.8
5,468.7
6,100.7
6,603.5
6,760.9
2,058.7
2,236.6
2,418.1
2,576.0
2,676.6
6,930.5
7,705.3
8,518.8
9,179.6
9,437.5
2,123.7
2,027.5
2,058.0
2,016.9
2,272.8
2,541.4
2,753.4
3,049.7
3,238.0
3,610.8
1,002.5
1,092.5
1,161.2
1,408.9
1,566.3
667.7
698.6
806.5
793.5
804.2
2,398.8
2,711.6
2,911.1
3,151.9
3,421.1
4,069.1
4,502.7
4,878.9
5,354.2
5,791.7
61,022.6
66,289.1
69,805.7
71,557.7
73,085.4
7,399.0
7,602.1
8,540.8
9,469.2
10,267.3
2,703.6
2,756.0
2,877.5
3,067.0
3,252.3
10,102.6
10,358.1
11,418.3
12,536.2
13,519.5
2,263.1
2,160.0
2,122.0
2,298.3
3,441.5
3,882.7
4,049.1
4,208.1
5,217.4
5,600.1
1,613.0
1,645.4
1,626.1
1,471.0
1,717.3
808.2
819.9
1,091.7
1,194.3
1,179.1
3,560.5
3,563.9
3,814.3
4,159.8
4,548.6
5,981.7
6,029.1
6,532.2
6,825.1
7,445.0
74,075.9
74,696.8
78,435.3
83,739.6
89,906.6
11,764.6
13,218.1
14,813.3
16,298.7
17,955.3
3,321.2
3,442.7
3,595.4
3,704.2
3,803.1
15,085.8
16,660.8
18,408.7
20,002.9
21,758.4
3,888.0
4,467.8
4,913.6
5,844.8
5,873.2
6,264.5
7,081.4
7,471.4
8,367.8
8,693.8
1,924.4
2,439.4
2,786.4
3,030.8
3,349.5
1,433.5
1,926.4
1,953.7
2,056.9
2,236.5
4,857.9
4,876.7
5,188.7
5,440.7
5,590.1
8,215.8
9,242.6
9,928.9
10,528.4
11,176.1
97,903.4
106,310.8
114,041.6
123,003.7
130,275.2
123
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Table A.3.2.1
Private-Sector Health Expenditure by Use of Funds,
Canada, 1975 to 2004—Current Dollars
Hospitals
Other
Institutions
Physicians
Other Professionals
Dental
Services
Year
A
B
Vision
Care
Services
Other
C
Sub-Total
D
($’ 000, 000)
124
1975
1976
1977
1978
1979
318.1
379.6
420.1
520.1
626.5
328.4
369.5
401.8
484.3
590.3
26.8
29.5
32.3
38.3
52.6
685.3
799.3
950.9
1,087.3
1,230.7
190.3
219.4
251.0
284.0
307.8
81.7
91.6
102.0
110.8
130.3
957.2
1,110.3
1,303.9
1,482.1
1,668.8
1980
1981
1982
1983
1984
749.2
903.4
1,090.8
1,243.1
1,408.5
718.2
743.2
853.4
947.2
992.3
51.5
49.7
67.7
79.4
81.3
1,397.0
1,533.4
1,802.7
1,965.1
2,135.5
347.1
434.9
518.6
609.3
711.7
150.5
177.0
214.3
247.7
271.2
1,894.6
2,145.2
2,535.7
2,822.1
3,118.4
1985
1986
1987
1988
1989
1,522.6
1,700.1
1,796.9
1,903.1
2,001.1
1,039.4
1,104.9
1,197.1
1,270.4
1,312.8
83.6
76.9
76.6
79.6
84.0
2,435.8
2,672.5
2,917.3
3,182.6
3,470.4
795.5
856.2
918.3
1,003.4
1,096.7
281.8
301.3
358.0
419.6
492.2
3,513.0
3,829.9
4,193.6
4,605.6
5,059.3
1990
1991
1992
1993
1994
2,240.3
2,421.4
2,537.8
2,670.0
2,660.6
1,581.4
1,768.3
1,889.9
2,012.9
2,092.0
87.9
90.9
93.8
97.3
102.2
3,756.8
4,061.8
4,272.8
4,500.9
4,781.2
1,177.3
1,237.1
1,295.4
1,376.0
1,479.0
562.1
619.7
679.0
732.6
797.4
5,496.2
5,918.6
6,247.2
6,609.5
7,057.6
1995
1996
1997
1998
1999
2,382.0
2,248.1
2,327.8
2,335.7
2,476.9
2,112.6
2,105.4
2,132.1
2,261.9
2,422.1
109.1
119.5
121.3
143.3
153.0
5,060.2
5,274.1
5,514.8
5,909.1
6,378.9
1,581.3
1,634.9
1,974.7
2,073.5
2,130.0
838.9
884.0
1,068.8
1,028.1
1,184.1
7,480.5
7,793.0
8,558.2
9,010.7
9,692.9
2000
2001
2002
2003 f
2004 f
2,664.6
2,643.0
2,826.5
2,950.5
3,082.7
2,574.0
2,793.5
2,973.4
3,156.4
3,323.1
175.3
148.5
259.8
234.6
255.5
6,783.6
7,361.2
7,830.5
8,351.0
8,843.2
2,346.1
2,513.3
2,559.2
2,703.3
2,840.9
1,217.2
1,450.8
1,503.5
1,619.1
1,727.0
10,346.9
11,325.2
11,893.2
12,673.4
13,411.1
f = forecast
CIHI 2004
Appendix
Drugs
Prescribed
Drugs
NonPrescribed
Drugs
Other Health Spending
Sub-Total
E
Capital
F
Public
Health and
Administration
Prepayment
Administration
Health
Research
Other
G
Sub-Total
Grand
Total
H
A+B+C+
D+E+F+
G+H
($’ 000, 000)
613.1
667.6
721.4
724.7
776.5
305.6
316.0
324.5
392.8
495.5
918.7
983.6
1,045.9
1,117.6
1,272.0
159.6
177.1
178.3
217.4
177.3
—
—
—
—
—
72.2
62.0
90.2
86.2
100.1
23.4
29.5
36.4
43.2
50.3
94.7
91.4
96.6
77.1
79.5
190.4
182.9
223.1
206.4
229.9
2,899.2
3,232.6
3,605.4
4,066.3
4,617.4
833.3
1,110.2
1,240.5
1,289.8
1,312.7
586.3
655.0
715.0
845.9
1,058.6
1,419.6
1,765.2
1,955.5
2,135.6
2,371.3
355.4
379.3
489.1
371.4
364.3
—
—
—
—
—
117.1
186.5
146.6
172.7
63.0
66.4
73.8
82.1
87.8
95.2
99.7
105.0
267.9
348.1
320.1
359.9
5,456.5
6,334.1
7,312.3
7,958.6
1,447.7
1,698.8
1,800.4
2,034.0
2,292.0
1,235.9
1,399.0
1,621.7
1,784.9
1,975.6
2,683.6
3,097.9
3,422.2
3,818.9
4,267.7
414.4
449.9
480.7
351.0
390.4
—
—
—
—
—
250.3
269.2
296.4
280.4
426.3
660.2
91.2
102.8
119.7
136.1
164.1
196.1
108.6
118.2
133.0
149.9
177.4
212.9
450.2
490.3
549.1
566.5
767.8
1,069.1
8,786.3
9,746.9
10,808.7
11,733.5
12,796.4
14,184.3
2,593.9
2,861.9
3,192.3
3,558.7
3,673.3
2,058.7
2,236.6
2,418.1
2,576.0
2,676.6
4,652.5
5,098.5
5,610.4
6,134.7
6,349.9
383.4
341.7
363.1
366.7
329.6
—
—
—
—
—
665.4
746.8
805.0
1,060.0
1,226.4
226.2
249.8
265.5
275.6
293.2
243.8
270.9
299.3
351.4
375.3
1,135.4
1,267.5
1,369.8
1,687.0
1,894.8
15,577.1
16,906.9
18,112.0
19,578.1
20,486.8
4,033.8
4,273.3
4,933.2
5,443.5
5,689.0
2,703.6
2,756.0
2,877.5
3,067.0
3,252.3
6,737.3
7,029.3
7,810.7
8,510.5
8,941.3
439.1
474.0
364.3
418.8
585.6
—
—
—
—
—
1,274.1
1,309.1
1,291.4
1,110.3
1,333.2
319.4
332.1
358.9
427.8
449.2
431.2
409.4
469.0
487.8
567.6
2,024.7
2,050.5
2,119.3
2,025.9
2,350.0
21,285.3
21,819.7
23,433.8
24,706.8
26,621.9
6,429.3
7,102.5
7,938.2
8,683.3
9,466.0
3,321.2
3,442.7
3,595.4
3,704.2
3,803.1
9,750.5
10,545.2
11,533.6
12,387.5
13,269.0
790.6
1,051.7
1,216.1
1,532.7
1,356.9
—
—
—
—
—
1,514.4
1,990.1
2,305.0
2,510.6
2,837.3
532.0
650.7
754.4
810.2
909.4
597.0
573.2
740.6
713.9
776.4
2,643.4
3,214.0
3,800.0
4,034.8
4,523.1
28,945.5
31,721.1
34,502.5
36,970.0
39,221.5
125
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Table A.3.3.1
Public-Sector Health Expenditure by Use of Funds,
Canada, 1975 to 2004—Current Dollars
Other
Hospitals
Institutions
Physicians
Other Professionals
Dental
Services
Year
A
B
Vision
Care
Services
Other
C
Sub-Total
D
($’ 000, 000)
126
1975
1976
1977
1978
1979
5,136.8
5,977.7
6,372.7
6,861.9
7,487.6
796.6
999.1
1,175.2
1,367.5
1,581.4
1,813.2
2,041.5
2,252.1
2,528.3
2,804.5
56.4
69.8
83.7
104.0
143.8
35.9
40.6
44.9
51.9
58.0
46.7
53.9
60.5
75.5
88.9
139.0
164.4
189.1
231.4
290.7
1980
1981
1982
1983
1984
8,585.2
10,127.4
12,001.9
13,174.5
13,936.3
1,821.5
2,146.7
2,531.4
2,794.4
2,923.3
3,236.0
3,775.1
4,353.1
4,973.3
5,444.6
194.9
278.4
270.0
260.7
266.7
67.2
78.7
91.1
105.7
117.7
104.9
126.7
143.0
164.0
181.0
367.1
483.9
504.2
530.3
565.4
1985
1986
1987
1988
1989
14,737.7
15,937.1
17,154.2
18,497.2
20,269.0
3,066.5
2,982.4
3,132.1
3,468.3
3,828.5
5,962.1
6,597.9
7,266.2
7,862.5
8,422.7
275.5
287.2
286.3
311.3
350.3
130.4
146.1
157.3
180.8
205.6
214.6
260.7
276.4
296.0
341.5
620.5
693.9
719.9
788.2
897.4
1990
1991
1992
1993
1994
21,626.1
23,293.5
24,129.5
24,069.5
23,505.0
4,166.8
4,576.6
4,897.9
4,783.5
4,829.6
9,157.3
10,114.5
10,354.7
10,401.6
10,629.4
382.2
405.7
417.4
426.1
435.9
225.4
247.7
239.6
211.0
204.1
394.5
463.0
492.6
487.7
456.2
1,002.1
1,116.4
1,149.6
1,124.8
1,096.2
1995
1996
1997
1998
1999
23,117.8
22,958.3
23,432.2
24,746.4
25,731.0
5,040.2
5,199.8
5,458.8
5,721.2
6,200.8
10,528.9
10,639.3
11,055.3
11,572.4
12,070.6
425.0
389.3
381.0
369.3
395.7
193.1
195.3
213.6
201.8
216.3
456.7
452.7
474.4
499.9
541.1
1,074.9
1,037.2
1,069.0
1,071.0
1,153.1
2000
2001
2002
2003 f
2004 f
27,889.8
29,556.0
31,548.6
33,858.2
35,814.0
6,757.3
7,311.1
7,803.1
8,391.2
9,133.1
12,801.7
13,829.5
14,790.9
15,778.0
16,529.7
421.9
441.9
449.2
433.3
424.3
228.1
237.9
235.1
242.1
248.3
589.7
571.6
539.3
542.2
551.9
1,239.6
1,251.5
1,223.6
1,217.6
1,224.5
f = forecast
CIHI 2004
Appendix
Drugs
Prescribed
Drugs
Other Health Spending
NonPrescribed
Drugs
Sub-Total
E
Capital
F
Public
Health and
Administration
Prepayment
Administration
Health
Research
Other
G
Sub-Total
Grand
Total
H
A+B+C+
D+E+F+
G+H
($’ 000, 000)
158.6
215.8
266.6
327.9
386.4
—
—
—
—
—
158.6
215.8
266.6
327.9
386.4
376.4
367.0
385.4
454.8
547.8
551.1
638.2
727.4
726.7
817.8
99.9
138.4
144.1
150.8
167.9
70.3
75.9
93.1
107.2
123.4
158.4
199.2
238.8
283.8
344.7
328.6
413.5
476.0
541.9
636.0
9,300.3
10,817.2
11,844.6
13,040.5
14,552.3
465.0
566.9
683.6
817.4
942.8
—
—
—
—
—
465.0
566.9
683.6
817.4
942.8
635.3
731.9
905.7
1,065.2
1,139.9
963.8
1,133.8
1,333.0
1,444.7
1,604.6
177.6
197.5
222.4
224.2
232.1
139.5
164.7
184.2
215.1
245.7
450.9
614.9
727.3
840.8
922.2
768.0
977.1
1,133.9
1,280.1
1,400.0
16,841.8
19,942.6
23,446.8
26,080.0
27,956.9
1,118.7
1,319.2
1,492.7
1,702.8
1,970.9
—
—
—
—
—
1,118.7
1,319.2
1,492.7
1,702.8
1,970.9
1,236.9
1,351.5
1,391.1
1,550.7
1,702.4
1,788.6
1,835.6
1,942.3
2,055.3
2,258.3
234.4
274.0
296.1
312.1
327.5
278.4
333.2
315.9
343.0
392.3
1,051.2
1,203.8
1,344.2
1,582.8
1,842.1
1,563.9
1,811.0
1,956.2
2,237.9
2,561.9
30,094.9
32,528.6
35,054.7
38,162.8
41,911.1
2,278.0
2,606.7
2,908.5
3,044.9
3,087.6
—
—
—
—
—
2,278.0
2,606.7
2,908.5
3,044.9
3,087.6
1,740.3
1,685.8
1,694.9
1,650.2
1,943.2
2,541.4
2,753.4
3,049.7
3,238.0
3,610.8
337.2
345.7
356.2
348.8
340.0
441.5
448.9
541.0
517.9
511.1
2,155.0
2,440.7
2,611.8
2,800.5
3,045.8
2,933.6
3,235.3
3,509.1
3,667.2
3,896.9
45,445.5
49,382.2
51,693.8
51,979.7
52,598.7
3,365.3
3,328.8
3,607.6
4,025.7
4,578.2
—
—
—
—
—
3,365.3
3,328.8
3,607.6
4,025.7
4,578.2
1,824.0
1,685.9
1,757.6
1,879.5
2,855.9
3,882.7
4,049.1
4,208.1
5,217.4
5,600.1
338.9
336.3
334.7
360.8
384.1
488.8
487.7
732.8
766.4
729.9
3,129.3
3,154.6
3,345.4
3,672.0
3,981.0
3,957.0
3,978.6
4,412.9
4,799.2
5,095.0
52,790.6
52,877.1
55,001.5
59,032.8
63,284.8
5,335.3
6,115.6
6,875.1
7,615.3
8,489.3
—
—
—
—
—
5,335.3
6,115.6
6,875.1
7,615.3
8,489.3
3,097.4
3,416.1
3,697.5
4,312.1
4,516.3
6,264.5
7,081.4
7,471.4
8,367.8
8,693.8
410.0
449.3
481.5
520.2
512.2
901.5
1,275.7
1,199.3
1,246.7
1,327.1
4,260.9
4,303.6
4,448.1
4,726.8
4,813.7
5,572.4
6,028.6
6,128.9
6,493.6
6,653.0
68,957.9
74,589.7
79,539.1
86,033.7
91,053.7
127
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Table B.1.1
Total Health Expenditure, by Province/Territory and Canada,
1975 to 2004—Current Dollars
B.C.
Alta.
Sask.
Man.
Ont.
Year
128
Que.
N.B.
N.S.
P.E.I.
N.L.
Y.T.
N.W.T.
Nun.
Canada
($’ 000, 000)
1975
1,383.4
992.3
441.2
546.3
4,422.8
3,378.8
277.5
382.5
59.2
264.5
15.9
35.1
---
12,199.4
1976
1,628.3
1,158.9
520.3
629.4
5,040.8
3,875.2
321.9
442.2
62.9
312.8
18.1
39.0
---
14,049.8
1977
1,831.8
1,272.1
587.4
706.0
5,524.6
4,200.7
358.9
469.1
68.7
362.9
18.5
49.3
---
15,450.0
1978
2,044.4
1,465.4
622.4
749.0
6,071.9
4,666.6
404.7
512.5
79.5
412.7
21.3
56.5
---
17,106.8
1979
2,288.6
1,781.0
703.5
823.3
6,728.0
5,149.6
470.0
573.0
96.6
473.3
23.9
59.0
---
19,169.7
1980
2,880.0
2,153.1
815.7
971.4
7,634.1
5,886.5
562.5
657.2
122.3
528.4
26.1
61.1
---
22,298.4
1981
3,430.4
2,623.7
949.0
1,153.2
8,903.0
6,887.8
681.2
788.8
136.4
621.3
28.2
73.8
---
26,276.7
1982
3,870.2
3,351.7
1,130.0
1,332.1
10,445.2
7,890.5
819.3
919.1
152.4
701.2
37.1
110.4
---
30,759.1
1983
4,155.7
3,622.1
1,257.6
1,478.6
11,850.0
8,675.3
894.6
1,004.8
164.5
773.7
38.0
123.5
---
34,038.6
1984
4,428.9
3,764.2
1,371.3
1,592.0
13,086.0
9,313.7
975.1
1,125.3
171.0
751.7
37.9
125.8
---
36,743.1
1985
4,637.3
4,070.4
1,528.8
1,726.5
14,442.8
10,031.9
1,026.2
1,232.5
181.2
785.8
39.7
138.5
---
39,841.7
1986
4,983.3
4,448.5
1,703.6
1,889.7
16,097.2
10,537.4
1,091.1
1,376.9
187.6
812.5
42.6
166.9
---
43,337.3
1987
5,340.3
4,499.9
1,767.8
1,980.2
17,866.4
11,268.6
1,194.0
1,560.6
202.9
881.6
44.7
181.3
---
46,788.2
1988
5,838.3
4,830.6
1,837.6
2,069.6
19,819.8
12,279.2
1,291.5
1,585.2
219.5
930.9
45.8
211.2
---
50,959.2
1989
6,509.0
5,349.8
2,052.9
2,257.4
21,970.8
13,290.3
1,400.1
1,751.8
239.3
991.6
49.5
232.9
---
56,095.5
1990
7,372.6
5,749.4
2,252.2
2,484.3
23,799.1
14,311.5
1,533.5
1,866.9
256.2
1,096.4
53.6
246.8
---
61,022.6
1991
8,126.7
6,062.5
2,319.8
2,576.0
26,194.3
15,634.6
1,629.3
1,970.0
280.6
1,153.2
62.6
279.5
---
66,289.1
1992
8,769.1
6,430.7
2,325.4
2,701.9
27,631.7
16,376.1
1,699.8
2,031.6
295.0
1,197.4
67.5
279.6
---
69,805.7
1993
9,296.8
6,520.4
2,301.9
2,749.1
28,133.7
16,904.2
1,739.1
2,025.0
311.7
1,209.1
79.6
287.1
---
71,557.7
1994
9,756.5
6,305.7
2,382.4
2,802.0
28,773.5
17,311.6
1,791.6
2,021.4
313.3
1,247.9
93.2
286.2
---
73,085.4
1995
10,099.0
6,085.0
2,439.5
2,912.7
29,320.6
17,356.7
1,818.0
2,059.4
327.1
1,268.2
94.8
294.8
---
74,075.9
1996
10,364.2
6,312.9
2,487.3
2,968.9
29,705.7
16,966.6
1,812.4
2,086.9
338.8
1,251.9
109.4
291.9
---
74,696.8
1997
10,817.8
7,073.1
2,653.1
3,097.4
30,780.0
17,744.1
1,854.8
2,361.6
340.0
1,303.8
102.6
307.1
---
78,435.3
1998
11,386.7
7,592.9
2,774.1
3,288.5
33,097.0
18,894.1
1,917.6
2,541.5
358.4
1,433.5
103.5
351.6
---
83,739.6
1999
12,253.7
8,659.3
2,967.2
3,686.1
35,352.2
19,814.7
2,072.3
2,661.5
377.4
1,578.7
108.4
233.5
141.7
89,906.6
2000
13,331.4
9,589.9
3,145.7
4,050.9
38,903.7
21,262.6
2,217.5
2,810.6
401.3
1,682.6
123.5
215.4
168.2
97,903.4
2001
14,620.0
10,927.5
3,442.6
4,290.9
41,600.3
23,136.9
2,449.5
2,991.3
455.9
1,806.6
142.3
263.3
183.8
106,310.8
2002
15,585.7
11,860.5
3,592.5
4,550.7
44,955.7
24,525.0
2,586.3
3,290.8
514.8
1,943.2
154.7
269.4
212.1
114,041.6
2003 f
16,287.9
12,789.3
3,780.0
4,890.7
49,425.5
26,210.7
2,720.0
3,548.4
531.5
2,110.1
159.0
284.1
266.5
123,003.7
2004 f
16,660.4
13,686.8
4,016.5
5,156.7
52,963.2
27,657.0
2,904.2
3,767.7
541.2
2,199.0
170.7
292.5
259.4
130,275.2
f = forecast
CIHI 2004
Appendix
Table B.1.2
Total Health Expenditure, by Province/Territory and Canada,
1975 to 2004—Current Dollars
B.C.
Alta.
Sask.
Man.
Ont.
Que.
1975
553.44
548.65
480.92
533.03
531.61
533.75
1976
642.64
619.96
558.53
610.01
599.11
1977
712.85
653.15
621.68
680.14
1978
782.10
724.79
653.82
1979
859.40
849.06
1980
1,049.86
1981
N.S.
P.E.I.
N.L.
Y.T.
N.W.T.
Nun.
Canada
409.87
462.74
502.62
475.29
726.48
818.67
---
527.13
605.80
466.84
529.45
529.82
555.99
804.44
880.95
---
599.14
649.52
653.12
515.80
558.65
572.56
641.93
810.18
1,103.96
---
651.19
719.36
706.71
724.60
578.47
606.81
653.05
726.96
899.00
1,248.03
---
713.87
733.14
793.65
776.66
796.36
668.42
674.68
785.24
830.23
998.00
1,289.33
---
792.08
982.07
843.21
938.89
872.94
904.64
796.61
770.61
988.59
922.34
1,073.08
1,319.09
---
909.54
1,214.75
1,143.63
972.49
1,112.70
1,010.40
1,051.94
964.41
923.01
1,102.17
1,080.88
1,177.79
1,552.38
---
1,058.67
1982
1,347.15
1,415.24
1,144.53
1,272.56
1,170.69
1,199.29
1,156.84
1,068.71
1,230.17
1,220.41
1,517.96
2,228.99
---
1,224.61
1983
1,430.31
1,515.28
1,255.25
1,393.48
1,310.60
1,313.98
1,250.58
1,156.08
1,311.30
1,334.99
1,611.11
2,420.07
---
1,341.85
1984
1,503.55
1,574.92
1,350.41
1,485.31
1,426.75
1,404.53
1,352.42
1,282.93
1,350.90
1,295.66
1,585.31
2,392.39
---
1,434.85
1985
1,559.13
1,693.92
1,490.78
1,595.25
1,553.40
1,505.01
1,418.05
1,392.54
1,419.40
1,356.50
1,630.07
2,546.73
---
1,541.70
1986
1,658.82
1,829.95
1,655.19
1,731.01
1,705.55
1,570.76
1,504.71
1,548.24
1,460.70
1,409.34
1,739.80
3,052.14
---
1,660.36
1987
1,750.82
1,847.76
1,711.73
1,803.40
1,852.54
1,661.41
1,640.40
1,746.68
1,578.34
1,532.79
1,741.02
3,293.37
---
1,769.01
1988
1,874.03
1,968.11
1,787.57
1,878.01
2,013.75
1,795.46
1,768.26
1,766.48
1,698.12
1,618.95
1,720.95
3,792.49
---
1,901.79
1989
2,035.41
2,143.98
2,014.15
2,045.59
2,173.70
1,918.16
1,904.32
1,938.19
1,840.01
1,720.39
1,826.71
4,084.51
---
2,056.15
1990
2,240.37
2,257.18
2,236.27
2,246.92
2,311.07
2,043.36
2,071.96
2,052.39
1,962.74
1,896.84
1,928.76
4,190.00
---
2,203.18
1991
2,409.00
2,338.38
2,313.60
2,321.53
2,511.89
2,213.09
2,185.39
2,152.81
2,153.50
1,989.99
2,164.74
4,586.61
---
2,364.82
1992
2,528.24
2,442.42
2,316.20
2,428.27
2,614.22
2,303.89
2,272.21
2,209.26
2,255.45
2,064.37
2,242.01
4,480.52
---
2,460.82
1993
2,606.03
2,444.45
2,286.26
2,459.81
2,632.17
2,362.48
2,322.46
2,191.52
2,358.94
2,084.83
2,622.42
4,517.40
---
2,494.88
1994
2,654.34
2,334.87
2,359.92
2,494.62
2,659.72
2,407.10
2,388.13
2,180.72
2,348.55
2,172.27
3,137.34
4,391.79
---
2,520.26
1995
2,673.80
2,225.27
2,405.56
2,579.55
2,677.68
2,404.16
2,420.84
2,218.76
2,433.70
2,234.86
3,115.33
4,428.49
---
2,527.99
1996
2,675.13
2,274.78
2,440.67
2,617.66
2,680.28
2,341.22
2,409.10
2,240.52
2,495.61
2,236.23
3,486.14
4,320.58
---
2,522.61
1997
2,739.69
2,499.26
2,605.98
2,726.27
2,741.29
2,439.18
2,464.73
2,532.60
2,498.00
2,366.14
3,227.26
4,533.25
---
2,622.61
1998
2,858.78
2,618.75
2,726.39
2,890.95
2,911.67
2,589.67
2,554.91
2,727.20
2,639.15
2,655.04
3,322.87
5,201.86
---
2,776.74
1999
3,054.75
2,932.11
2,924.15
3,226.40
3,072.40
2,705.71
2,760.86
2,850.00
2,769.33
2,959.70
3,522.44
5,742.54
5,282.14
2,957.08
2000
3,300.51
3,191.37
3,121.43
3,530.58
3,329.26
2,890.11
2,954.69
3,009.60
2,940.42
3,186.53
4,059.13
5,317.49
6,116.91
3,190.17
2001
3,584.70
3,574.87
3,442.11
3,727.04
3,496.52
3,127.89
3,266.52
3,208.23
3,335.60
3,460.98
4,721.67
6,449.09
6,535.18
3,427.03
2002
3,787.16
3,805.93
3,607.30
3,937.98
3,714.72
3,293.83
3,446.89
3,521.45
3,759.63
3,740.98
5,134.41
6,494.05
7,381.38
3,635.07
2003 f
3,922.62
4,049.00
3,801.21
4,210.50
4,032.55
3,498.34
3,622.28
3,790.38
3,872.22
4,070.82
5,202.59
6,732.40
9,143.86
3,885.09
2004 f
3,970.18
4,274.58
4,035.13
4,406.43
4,273.73
3,666.69
3,865.09
4,021.16
3,925.56
4,253.07
5,469.49
6,833.25
8,751.41
4,077.94
Year
N.B.
($’ per Capita)
f = forecast
CIHI 2004
129
Order Form
Title ____________________________________________________
Method of Payment
" A cheque or money order payable to the Canadian Institute
for Health Information for $_________________ is enclosed.
Organization ____________________________________________
" Visa
Address _________________________________________________
Card Number ____________________________________________
City, Prov. or Terr., Postal Code
______________________________
Expiry Date ______________________________________________
Name __________________________________________________
_________________________________________________________
Telephone _______________________________________________
Fax _____________________________________________________
Email __________________________________________________
PRODUCT!
" MasterCard
Cardholder Name ________________________________________
Authorized
Signature________________________________________________
Please send payment to:
Canadian Institute for Health Information, Order Desk,
495 Richmond Road, Suite 600, Ottawa, Ontario K2A 4H6
Tel.: (613) 241-7860 Fax: (613) 241-8120
QUANTITY
PRICE A
PRICE B
Exploring the 70/30 Split: How Canada’s Health Care
System Is Financed
(Printed version)
$30.00
$40.00
Exploring the 70/30 Split: How Canada’s Health Care
System Is Financed
(Web version on www.cihi.ca)
$0
$0
Le ratio 70/30 : Le mode de financement du système de
santé canadien
(Printed version)
$30.00
$40.00
Le ratio 70/30 : Le mode de financement du système de
santé canadien
(Web version on www.cihi.ca)
$0
$0
N/A
N/A
GST/HST registration no. R137411641.
Subtotal
Handling and shipping for orders outside of Canada (minimum $25.00)
Taxable total
GST (7%) or HST (15%)*
TOTAL
Price A applies to Canadian health care facilities, governments, not-for-profit health agencies,
universities, health professionals and researchers from the public sector.
Price B applies to private commercial operations (such as, but not limited to, software vendors
and consultants), foreign clients and others not qualifying for Price A.
N/A = Not applicable.
! For information about other CIHI products, please see the catalogue on CIHI’s Web site (www.cihi.ca).
* All Canadian orders are subject to 7% Goods and Services Tax or a 15% Harmonized Sales Tax for Nova Scotia,
New Brunswick and Newfoundland and Labrador. (Not applicable to orders shipped outside of Canada.)
TOTAL
It’s Your Turn
It’s Your Turn
We welcome comments and suggestions about Exploring the 70/30 Split: How Canada’s Health Care System
Is Financed, and about how to make future reports more useful and informative. Please email your ideas to
[email protected] or complete this feedback sheet and send it to us at:
Health Reports Feedback
Canadian Institute for Health Information
90 Eglinton Avenue East, Suite 300
Toronto, Ontario M4P 2Y3
Instructions
For each question, please select the most appropriate response. Individual responses will be
kept confidential.
Overall Satisfaction With the Report
1. How did you obtain your copy of Exploring the 70/30 Split: How Canada’s Health Care
System Is Financed?
"
"
"
"
"
It was mailed to me
From a colleague
Through the Internet
I ordered my own copy
Other (please specify)______________________________________
2. To what extent have you read through the report?
" I have read through the entire report
" I have read certain chapters and browsed through the entire report
" I have browsed through the entire report
3. How satisfied are you with the following aspects of the report?
Clarity
Organization/format
Use of figures
Quality of analysis
Level of detail presented
Length of the report
"
"
"
"
"
"
Excellent
Excellent
Excellent
Excellent
Excellent
Excellent
"
"
"
"
"
"
Good
Good
Good
Good
Good
Good
"
"
"
"
"
"
Fair
Fair
Fair
Fair
Fair
Fair
"
"
"
"
"
"
Poor
Poor
Poor
Poor
Poor
Poor
It’s Your Turn
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
Usefulness of the Report
4. Please indicate how useful you found each of the following sections of the report:
Health Financing
The Canadian Reality
What It Costs
Hospital Services
Physician Services
Retail Drug Sales
Oral Health
Care Services
Eye Care
Continuing Care
Mental Health
Services
Complementary
and Alternative
Services
"
"
"
"
"
"
Very Useful
Very Useful
Very Useful
Very Useful
Very Useful
Very Useful
"
"
"
"
"
"
Somewhat Useful
Somewhat Useful
Somewhat Useful
Somewhat Useful
Somewhat Useful
Somewhat Useful
"
"
"
"
"
"
Not Useful
Not Useful
Not Useful
Not Useful
Not Useful
Not Useful
Did Not Read
Did Not Read
Did Not Read
Did Not Read
Did Not Read
Did Not Read
" Very Useful
" Very Useful
" Very Useful
" Somewhat Useful
" Somewhat Useful
" Somewhat Useful
" Not Useful
" Not Useful
" Not Useful
" Did Not Read
" Did Not Read
" Did Not Read
" Very Useful
" Somewhat Useful
" Not Useful
" Did Not Read
" Very Useful
" Somewhat Useful
" Not Useful
" Did Not Read
5. How do you plan on using the information presented in this report?
6. What did you find most useful about this report?
7. Do you think you will refer to CIHI’s health reports during the year?
" Yes
"
"
"
"
"
"
" No
" Maybe
Exploring the 70/30 Split: How Canada’s Health Care System Is Financed
8. How would you improve this report? Do you have any suggestions for future reports?
Reader Information
9. Where do you live?
" Newfoundland and Labrador
" Nova Scotia
" New Brunswick
" Prince Edward Island
" Quebec
" Ontario
" Manitoba
" Saskatchewan
" Alberta
" British Columbia
" Northwest Territories
" Yukon Territory
" Nunavut
" Outside Canada (please specify country)_________________
10. What is your main position or role?
" Health services manager or administrator
" Board member
" Health care provider
" Educator
" Researcher
" Policy analyst
" Elected official
" Student
" Clinician
" Other (please specify)______________________________________________
Thank you for your feedback.
It’s Your Turn
www.cihi.ca
Taking health information further
www.icis.ca
À l’avant-garde de l’information sur la santé
Was this manual useful for you? yes no
Thank you for your participation!

* Your assessment is very important for improving the work of artificial intelligence, which forms the content of this project

Download PDF

advertisement