Think Your Health Plan Is Free? Think Again.
Many Canadians, through no fault of their own, have no idea how much they are actually paying for health care. Canada’s public health care system is funded through general government revenues instead of a dedicated tax: revenues from various taxes are mixed together, and from that pool of funds, a certain amount is allotted for health care.
While the big picture is easy to see, an individual’s contribution is virtually impossible to calculate. According to data from the Canadian Institute of Health Information, in 2021 provinces’ expenditure on healthcare was about $200 billion, and the federal government’s contribution in 2020-2021 was roughly $46 billion a year via the Canada Health Transfer (CHT). Even before the pandemic, Canada was ranked among the highest health care spenders in the world, with second-highest level of health care spending (as a share of its economy) and seventh-highest per capita (on an age-adjusted basis) among 27 other countries with universal health care in 2018.
But do Canadians get good value for this high spending? A recent study of economically developed countries with universal health care ranked Canada second to last for acute care beds and near the bottom for the number of physicians. The pandemic has only exacerbated a long-standing shortage of medical resources. And, of course, Canada’s crisis surrounding wait time for care has been well documented.
Though the numbers vary considerably by income, a 2022 Fraser Institute study estimates that for health care:
• The average individual earning $50,140 can expect to pay $4,907 per year
• A Canadian family earning an average income of $76,704 will pay approximately $7,374 per year
• A typical family (two parents and two children) earning $156,086 will pay approximately $15,847 per year
• The highest earning 10% will pay a whopping $41,914 per year
Since 1997 (the first year of available data), the change in the cost of health care for the average Canadian family has outstripped the growth in income and inflation. The cost of public health care insurance for the average Canadian family has increased 3.9 times as fast as the cost of clothing, 2.2 times as fast as the cost of food, 1.8 times as fast as the cost of shelter, and 1.8 times as fast as the average income.
Gino Stirpe, Vice President of VUMI® Canada comments, “‘Don’t touch my free health care,’ is a common refrain from defenders of Canada’s status quo. Unfortunately, for all the money spent, international statistics suggest Canadians are not receiving commensurate value in return. Canadians, unaware of how much they are actually paying, realize the system needs to be updated to allow them to seek care alternatives. Private insurers, like VUMI® Canada, offer faster access to medically necessary care, non-emergency services and a broader selection of healthcare providers.
Sources: Epoch Times; The Fraser Institute, August 9 and 12, 2022
