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Canadian Health Care System Provides Poor Value for Tax Dollars Spent

By Nadeem Esmail Created: May 20, 2012 Last Updated: June 9, 2012
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With the turning of the calendar to May, the effort required to complete our income tax returns will slowly start to fade from memory. And while many Canadians no doubt grumble about the size of their tax bill, recent news reports have also highlighted other Canadian taxpayers who are apparently willing to pay more in taxes for things such as health care.

While income taxes make up just 30 per cent of the tax bill for the average Canadian family, the amount of money spent on health care by Canada’s governments is equivalent to about two-thirds of all personal income taxes.

So would paying more in taxes lead to better health care? The evidence suggests not. In fact, when compared to other nations that also have universal access health care systems, we find that Canadian families are not receiving value for the tax dollars currently spent on health care.

Given Canada spends so much relative to its economy, you might expect that Canadians receive world-class access to health care. Nadeem Esmail

Canadians fund the developed world’s fifth most expensive universal access health insurance system. According to the most recent apple-to-apple statistics available, only the Netherlands, France, Germany, and Denmark spent more on their universal health insurance system as a share of GDP (while Switzerland spent as much as Canada). Canada’s expenditures are 22 per cent higher than the average nation providing universal access health care within the Organization for Economic Co-operation and Development (OECD).

Given Canada spends so much relative to its economy, you might expect that Canadians receive world-class access to health care. Alas, the evidence shows otherwise.

Consider waiting lists. In 2011, the median wait time from general practitioner referral to treatment by a specialist was 19 weeks in Canada. Despite substantial increases in both health spending and federal cash transfers to the provinces over the past 15 years, the 2011 wait time was 60 per cent longer than the 1997 median wait time of 11.9 weeks. In 2011, patients waited more than double the 9.3 weeks they would have waited in 1993. Our indicators are getting worse, not better.

Canada’s waiting lists are also among the longest in the developed world. Consider for example, the 2010 findings from a survey of individuals in eleven nations, 10 of which maintain universal access health insurance programs. According to the Commonwealth Fund, among the 10 universal access nations surveyed (Australia, Canada, France, Germany, the Netherlands, New Zealand, Norway, Sweden, Switzerland, and the UK):

Canadians were the most likely to wait four months or more for elective surgery; and were less likely to wait less than one month for elective surgery than all but Sweden.

Canadians were the most likely to wait six days or longer to see a doctor or nurse when sick, and were the least likely (tied with Norway) to receive an appointment the same day or next day.
Canadians were the most likely to wait two months or more for a specialist appointment and least likely to wait less than one month for a specialist appointment.
Canadians were the least likely to wait less than 30 minutes and most likely to wait four hours or more for access to an emergency room.

That is hardly the sort of access you might expect from one of the developed world’s most expensive universal access health insurance systems.

Access to medical technologies is also relatively poor in Canada. In a recent comparison of inventories of medical technologies per one million people: in MRI machines, Canada ranked 15th of 26 OECD nations for whom data was available; 17th of 27 nations in CT scanners; 11th out of 24 in PET scanners; and 19th of 21 in lithotripters. Research also shows that Canada’s relatively small inventory of medical technologies consists of many old and outdated machines. Clearly, Canada’s relatively high expenditures neither buy quick access to care, nor do they buy high tech health care equipment and services for the population.

Government restrictions on medical training, along with a number of other policies that affect the practices of medical practitioners, have also taken their toll on Canadians’ access to health care. A recent comparison found Canada ranked 26th of 32 OECD nations for which data was available in the number of physicians per thousand population. It should come as no surprise that Statistics Canada determined that nearly 1.9 million Canadians aged 12 or older could not find a regular physician in 2009.

While our taxes can and do pay for important and valuable services for all Canadians, patients do not receive value for the tax dollars spent. In health care, Canadians pay for a world-class health care system; but receive something less than that in return. And the evidence suggests that taking more tax dollars for health care will not resolve this problem.

Nadeem Esmail is the Fraser Institute’s former Director of Health System Performance Studies.




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