Soaring Healthcare Costs Forces Canada To Reassess National Healthcare

Healthcare in Canada is provided by the federal government through a system funded with tax dollars. The program covers all “medically necessary” physician care and hospital stays. The role of private medicine is practically non-existent. Slightly over 40 percent of provincial budgets, or some C$183 billion ($174 billion) last year was spent on healthcare.

Faced with this increasing cost and an aging population, Canada’s provinces are having to make tough decisions to curb the costs. This action could erode the principles of the popular national healthcare system. The province of Quebec has implemented a flat health tax and is seriously considering a co- payment on each medical visit. This idea has critics up in arms, stating that it is an illegal user fee.

According to Derek Burleton, senior economist at Toronto-Dominion Bank, “There’s got to be some change to the status quo whether it happens in three years or 10 years. We can’t continually see health spending growing above and beyond the growth rate in the economy because, at some point, it means crowding out of all the other government services. At some stage we’re going to hit a breaking point.”

The politicians in the United States would do well to pay heed to what is happening with countries that have experimented with government run healthcare systems. When something is “free”, everyone wants as much as they can get with no incentive to show restraint. The only true way to control cost in a state run system is to ration the services.