Healthcare in Canada


Canada, the world’s second largest country in total area after Russia, has a population approaching 32 million. Formed in 1867 through the British North America Act, Canada is a constitutional monarchy made up of 10 provinces and three territories. Despite the country’s size, 80% of Canadians live within 200 kilometers (124 miles) of the border with the United States.

Q: What kind of healthcare system does Canada have?

A: Since 1962, Canada has had a government-funded, national healthcare system founded on the five basic principles of the Canada Health Act. The principles are to provide a healthcare system that is: universally available to permanent residents; comprehensive in the services it covers; accessible without income barriers; portable within and outside the country; and publicly administered.

Under this system, Canada’s provinces and territories are responsible for administering their own healthcare plans, and must provide residents with prepaid coverage for all medically necessary hospital and physician services.

Provincial and territorial responsibilities therefore include planning, financing, and providing hospital care, medical care, public health, and some facets of dispensing prescriptions. Coverage for services such as dental care, prescription drugs, optometric services, hearing aids, and home care, varies by province or territory. For example, the province of Ontario has instituted its own prescription drug plans, The Ontario Drug Benefit (ODB) Program and the Trillium Drug Program, in order to help seniors and others with the high costs of prescription drugs. These differ from British Columbia’s Fair Pharmacare Program, and from Alberta’s prescription drug plans, which are offered in conjunction with Blue Cross, a private insurer.

It should be pointed out that the Canada Health Act’s principle of “portability” applies primarily between provinces. Although the Act entitles Canadians to “receive necessary services in relation to an emergency when the absence is temporary, such as on business or vacation”, reimbursement for treatment in a foreign country is partial. Because of the high costs of medical care in some countries (e.g. the United States), most Canadians purchase travel insurance when travelling abroad.

Q: How is the healthcare system funded?

A: Canada’s healthcare system is funded by both the federal government, and by the provincial and territorial governments. The main source of revenue is taxation, i.e., personal and corporate income taxes (in some provinces, sales tax is also used). Some provinces also charge a yearly healthcare premium based on annual income. In Ontario, for example, an individual with taxable income of C$48,500 (US$40,500) would pay a premium of C$575 (US$480) in the 2005 tax year.

According to World Health Organization (WHO) 2001 statistics, Canada’s total expenditure on health as an expenditure of Gross Domestic Product (GDP) is 9.5%. This can be compared with 13.9% in the United States and 7.6% in the United Kingdom. And Canada ranks 30th on the WHO’s year 2000 report on the cost effectiveness of global healthcare.

Health expenditures in Canada have increased in recent years. In 2000–2001, health expenditures totaled C$97.6 billion (US$81.5 billion), an increase of 7.2% when compared with 1999-2000. The figures given for 2000–2001 amount to C$3,174 (US$2,652) per capita.

The largest part of the government healthcare budget goes to hospitals. As a percentage of overall healthcare spending, spending on prescription drugs has increased in recent years, whereas it has decreased for doctors.

In addition to healthcare premiums, some provinces in Canada have attempted to reduce the burden of healthcare costs by contracting out health services to so-called P3s, or “private-public-partnerships.” The institution of P3s has proven to be controversial. Although private companies, P3s continue to be paid for by public funds, and constitute a middle ground between a public and a fully privatized healthcare system. Ontario’s provincial government plans to build P3 hospitals in the cities of Ottawa and Brampton, and similar projects are underway in the provinces of British Columbia and Quebec.

Canadians have shown little sympathy for P3s, seeing them as the beginnings of a “two-tier system” of healthcare, where care is based on ability to pay, as opposed to need.

Q: What is the quality of care?

A: According to a Joint Canada/United States Survey of Health for 2002–2003, undertaken by Statistics Canada and the US Centers for Disease Control and Prevention, 87% of Canadians are somewhat or very satisfied with their overall healthcare services.

Indeed, overall, the quality of life in Canada is excellent. Canadian cities surveyed all ranked within the top 20 in Mercer Human Resource Consulting’s 2004 overall quality of life survey. Mercer’s survey looked at 39 criteria, including social, political, economic, environmental, and health factors. The evaluation of “health” was based on factors such as personal safety, as well as the quality and availability of hospital and medical care, and medical supplies.

Nonetheless, disparities exist in terms of the regional quality of care in Canada. Canada’s rural and remote northern communities do not have the same level and quality of healthcare as do its southern cities. And throughout Canada, concerns regarding the level of government funding and the quality of healthcare services have led to a public debate on the healthcare system as a whole.

Q: What are the current concerns among healthcare workers in the country?

A: The Canadian Healthcare Association, and other concerned bodies, such as the Canadian Nurses Association, have put forward a Common Vision for the Canadian Health Systemdocument. It argues that four key areas need improvement in the country’s healthcare system: patient waiting times; overall healthcare funding; shortages in personnel and improvement of medical technology; and the expansion of the healthcare system to include home, pharmaceutical, and long-term care.

Moreover, Canadian nurses have expressed particular dissatisfactions with the healthcare system in recent years. In 2002, the Canadian Nursing Advisory Committee delivered a report which recommended increasing the number of nurses, improvements in education, and maximizing the scope of practice of nurses.

The lure of more lucrative salaries has also led to a “brain drain” of professionals to the United States in recent years. Although overall emigration has been relatively small, healthcare professionals constitute a significant proportion of the public sector workers who have chosen to leave Canada for employment in the United States.

Q: What are the current concerns among patients?

A: Waiting times to see specialists and for diagnostic tests have become a point of issue for Canadians. According to a study by the Fraser Institute, a conservative think tank, such waiting times have increased from 13.1 weeks in 1999, to 17.7 weeks in 2003, to 17.9 in 2004. Long waits to undergo elective surgery have also become an issue in recent years, as have crowded emergency rooms in the country’s largest cities.

One response to these concerns on the part of patients has been to seek treatment in the United States or overseas. While “medical tourism” is derided by some in Canada as queue-jumping, others see it as a legitimate means of dealing with the healthcare system’s shortcomings. The province of Alberta currently reimburses patients who have sought medically necessary physician, oral surgery, and hospital services not immediately available in Canada.

The frequency of adverse events, or errors in treatment that might harm the patient or the outcome of their treatment while hospitalized, has also raised concerns in regards to the country’s healthcare system, both among healthcare workers and patients.

Q: What are the current challenges in providing healthcare?

A: In 2004, the federal government and the provinces struck a C$41-billion (US$34.2-billion), 10-year agreement to improve Canada’s healthcare system.

At the center of this agreement is an attempt to reduce waiting times. A Wait Times Reduction Fund has been instituted to help the provinces accomplish this. The fund allows the provinces to increase the hiring of healthcare professionals, clear backlogs, increase capacity, and expand ambulatory and community care programs. The provinces have themselves agreed to set targets for acceptable wait times, and have also agreed to cooperate in establishing a common set of criteria to measure wait times across the country.

A new Public Health Agency of Canada (PHAC) was launched in 2004. The main task of the PHAC is to find more effective means of combating chronic diseases such as cancer and heart disease, and to respond to public health emergencies and infectious disease outbreaks. The PHAC is headed by a Chief Public Health Officer who will assume the role of the federal government spokesperson on public health issues, especially during public health emergencies.

The PHAC will also have to respond to the chronic problems facing healthcare users in remote and rural areas of Canada’s north. In fact, most of the communities that are spread across Canada’s remote northern areas do not have a doctor, and as a result, simple services such as checkups require travel and often involve long delays. Moreover, the cost of providing healthcare is proportionally much higher in the northern territories than in the rest of Canada.

One solution recently put forward is to develop medical schools and facilities in the north, with the hope that doctors who are trained there will eventually practice there. The new Northern Ontario School of Medicine,a joint venture between two Ontario universities, Lakehead University in Thunder Bay and Laurentian University in Sudbury, is one such project, and will begin admitting students in the fall of 2005.

Another proposed solution for Canada’s northern communities is “telehealth.” Telehealth refers to the use of communications and information technology to deliver healthcare services over long distances. While there is no federally administered system of telehealth in Canada, most provinces have instituted and maintain their own systems. In Ontario, for example, a free, confidentialtelephone service, staffed by Registered Nurses, is available for advice and general health information 24/7.