Growing up in this country, the concept of “free healthcare” was always seen as a trump card to play against someone who ever wanted to take a jab at your country. Canada is x, y, or z? “Yeah, at least we have free healthcare”. I mean, this statement was amplified during Michael Moore’s films Bowling for Columbine (2002) and Sicko (2007) – more explicitly Sicko – where he describes how Canadians live with free healthcare, and how it was seen as such a relaxing, stress free, and enjoyable situation. ‘Just show up and get a doctor, no premiums, no deductibles, and here’s a whole 3 people who said they only have to wait 25-40 minutes for a doctor’. In case my Canadian sarcasm does not come through in text, that is sarcasm. Because the so-called “great healthcare system” is not as great as it may seem.
How Our Healthcare Works?
How does Canadian healthcare work? Well, it starts at the top with the Canadian Health Act which was passed in parliament in 1984 – but the history of our healthcare starts a lot earlier. In 1947, Saskatchewan Premier Tommy Douglas established the first publicly-funded hospital insurance plan – which led to a full and comprehensive public healthcare system in 1957. With the help of Conservative Prime Minister John Diefenbaker passing the Hospital Insurance and Diagnostic Services Act, federal funds would help reimbursement of provincial funds for diagnostic services. By 1961, all 10 provinces were in agreement with this plan, and in 1966, the Medical Care Act was passed providing more funds to meet hospital and physician services. Once most provinces established a system, they all coalesced in the 1984 Canadian Health Act, which leads to where we are today – a single-payer system that established a public funding apparatus and guideline to provinces to create their own public healthcare systems. But how does this single-payer system actually work?
The single-payer healthcare system in Canada operates on the principle that healthcare services are funded by a single public entity (the government), while services are provided by private and public organizations. It starts with funding, where does the funding come from? The Canadian healthcare system is primarily funded through taxation – both federal and provincial/territorial. It is through governments and tax policy that create the single-payer system. Yes, healthcare in Canada gets a ‘double dip’ from tax payers meaning the same healthcare is essentially taxed twice – both federal and provincial – from one tax payer. The federal taxes for healthcare go into the Canada Health Transfer (CHT) which allocates funds to provinces and territories based on their population and specific needs. Much like how grain was sent from Ukraine and Belarus to Moscow in Soviet Russia, only to be redistributed based on the needs of federal government.
This is what we would call socialized healthcare, we pay our taxes, we get access to healthcare, and my Soviet sarcasm aside, we really do get ‘access’ to healthcare. Once that money is funneled to the provinces, it is the provinces that run the healthcare system in their respective locations. For example, I have what is called an Ontario Health Insurance Plan (OHIP) Card which I carry with me when I go see my GP, or a surgeon, or if I need to go to the ER. I show my health card and I see a doctor. It’s easy when it’s described like that. However, it’s not as easy as it sounds. The bulk of this blog will be dedicated to the comparison of health care between the United States and Canada. I selected this comparison because it is the most common debate between the two countries, with the US getting a large share of the vitriol because it doesn’t have “free healthcare”. We will use this comparison based on quality and availability.
Quality and Availability
The diagram makes it look easy, that a minor amount of taxes is able to give us so much in terms of healthcare – that is not entirely true. Sure, it can pay for big ticket items like MRIs, hospital visits, ambulance rides, surgery, etc., but a majority of the charges go toward access to see a GP or a specialist such as an oncologist or endocrinologist. What OHIP does not cover is dental, vision, physiotherapy, items for recovery (such as slings and casts), or prescription drugs. Also, what is rarely discussed is the amount of taxes that we pay to fund our socialized system of healthcare. Canada is one of the highest taxed countries in the world. The OECD reports that out of 38 countries assessed, Canada ranks 5th. Furthermore, comparing the 10 provinces with the 51 states and jurisdictions in the United States, Canada’s 9 provinces ranking in the top 10, and all provinces ranking in the top 15 out of 61.
Comparative analysis of the data from the Canada Revenue Agency (CRA) and the Internal Revenue Service (IRS), Canadians, on average, pay anywhere from 10-15% in taxes than their neighbors to the south. In addition, on average US taxpayers pay anywhere from 6% to 9% for Medicare or private health insurance. So not only are we paying more in taxes. In theory, our median income could be charged less taxes and still would have enough money to pay for Medicare or private health insurance.
Ok, one may see these numbers as negligible, considering many different health factors can cause premiums to rise in the US. Not to mention, hospital visits and ambulance rides are quite pricey, and we are not taking into account different state taxes. Also, there are many other factors that can contribute given the statistics are not as focused, meaning one can make a pretty salient argument that $7000 per year in health care can come out even with Canada. The true analysis rests with comparing quality and availability.
Quality
First, let’s look at quality, how do we define it? We can define it as the degree to which health services for individuals and populations increase the likelihood of desired health outcomes. This can be based on many factors such as:
- Effectiveness: How good the scientific knowledge is with medicine
- Safety: Avoiding harm to patients
- Patient-Centeredness: Respectful and responsive care
- Efficiency: Avoiding waste, both physical products and financials
In researching this topic from the NBER, the United States has a much higher level of professional expertise, testing, and treatment options. One can look at the many medical schools, and hospitals attached, far exceed Canada by leaps and bounds, meaning the research capabilities are running at a level that Canada cannot compete with. Key data points in the area of cancer is apparent, age adjusted Mortality to Incidence rates show that the US performs far better than Canada in all cancers (0.41 for the US, 0.45 for Canada). Not to mention, less than median income individuals in the US see a higher health status than their counterparts in Canada.
As for safety, the US has a higher rate of medical malpractice, as a prior study shows almost 200,000 cases in the United States compared to the 20,000 in Canada. However, population plays a big role here with approximately 330 million in the US compared to 40 million in Canada. When we look at this in per capita terms, the United States has 60 per 100,000 cases compared to Canada with 50 per 100,000 cases. There are also many variables to consider, despite these numbers, only about 1,000 medical malpractice claims are filed each year, largely due to the high cost and difficulty of pursuing such cases in Canada. The Canadian Medical Protection Association (CMPA), a powerful entity defending most doctors in Canada, plays a significant role in discouraging claims due to its extensive resources and high success rate in defending cases. In addition, a study in 2014 shows that Canada ranks far below the OECD average for medical safety. One of the biggest issues identified in the study was that Canada ranked amongst the worst for leaving objects in patients such as sponges and medical equipment after surgery. Although, Canada fairs better than the US in per capita numbers, additional variables make the difference largely negligible.
For patient-centeredness, reports show that the United States and Canada both rank well in terms of respectful care; whereas the United States ranks far better in terms responsive care given the variety of options available and competition to retain patients. The NBER study also confirms that patients aged 18-64 in the US have a better incidence ratio where more patients with a confirmed condition get treatment. For example, the percentage of incidence with overall heart disease is 3.6% in the United States compared to 3.3% in Canada. However, 82% of patients in the United States receive treatment compared to 78% in Canada.
In terms of efficiency, as in avoiding waste, both with physical equipment and financial outcomes, both countries fare well. Again, the United States given its large population spends far more on healthcare than Canada does which leads to more administrative costs which lead to wasteful spending – and overall, per capita spending is much higher in the United States than in Canada (16% in the US, 10% in Canada). However, the University of Toronto has noted that Canadian wasteful spending has gone up leaving room for improvement.
Availability
Availability can be defined as the extent to which health services are readily accessible to individuals when needed. This concept encompasses several key aspects:
- Accessibility
- Timeliness
- Range of Services and Hours Served
In terms of accessibility, we look at the ease with which patients can physically reach healthcare facilities and providers. This includes geographic proximity and the presence of necessary transportation. Both have advantages and challenges, obviously with large city centers having fairly high accessible healthcare, with rural areas experiencing challenges. With that said, Canada faces even more challenges considering the United States is a more densely populated country with 34 people per km2, compared to 4 per km2. This leads to the US dominating in medical infrastructure with 6100 hospitals compared to 1200, and thousands of medical clinics.
Timeliness refers to the promptness with which patients can receive care, including the availability of appointments, reduced wait times, and the speed of service delivery. This is perhaps the biggest criticism of the Canadian healthcare system. The Commonwealth Fund determines that 42% of Canadians waited more than 2 hours in the Emergency Room (ER) compared to 29% in the United States. Also, a staggering difference in time to see a specialist – in the United States, 23% waited over 4 weeks to see a specialist compared to 57% in Canada. That is almost 1 in 3 Canadians unable to see a specialist within a month’s time. Another interesting stat on timeliness is the availability and service. Canada has longer wait times and shorter visits with doctors leading to missed diagnoses and lack of proper prescriptions. This is due to the incentive of the Canadian healthcare system relying on OHIP disbursements for doctors. Doctors tend to churn out patients at a higher rate compared to the United States.
As previously noted in the NBER study, the United States has a much higher range of service and hours offered compared to its sizes of hospitals and geographic availability. Not to mention the competitive factor of the free-market style of healthcare in the US, compared to the centralized style in Canada. Far more US citizens answered that they were fully satisfied with the healthcare services compared to Canada. Furthermore, more US citizens ranked the healthcare excellent compared to Canada and the statistics show this. The United States on average scored 2% points higher than Canada based on service. In addition, Computed Tomography (CT) scans, and Magnetic Resonance Imaging (MRI) scan service per million population was far higher in the United States than Canada. The US saw 59 combined CT and MRI services per million compared to Canada’s 17.
Which is Truly Better?
What can we determine from the information provided to us? If we were to give a scorecard based on the service, how would we determine the outcomes? Let’s say we give letter grades A-D that map on to the numbers 4-1 and determine an objective measure based on the information provided.
| United States | Canada | |
| Effectiveness | A | B |
| Safety | B | A |
| Patient-Centered | A | B |
| Efficiency | C | A |
| Accessibility | B | C |
| Timeliness | B | D |
| Range | A | C |
| TOTAL | A- | C+ |
Some can look at this and derive their own weight based on the different types of quality and availability. For example, the efficiency statistics in terms of spending and pricing could be weighted much higher given that the price point for Canada is obviously far better than the US given its socialized nature. But as we already know, the taxation in Canada compared to the insurance premiums in the United States is largely negligible. Meaning we can consider other factors that far exceed pricing. The most impactful statistic must be the effectiveness. Which country offers better outcomes for the patients in a timely manner with the most care for patients. This is far and away a win for the United States.
Implications for the Canadian Healthcare System
I tried my best not to rely on anecdotal evidence, just objectively looking at the data that was provided to me. I can certainly see criticisms being levied given that this can come as a shock to Canadians, and other more socially leaning individuals, that this data breaks the pre-conceived notions that were held about the infallible and utopic Canadian Healthcare system. The misconception of the Canadian healthcare system does not only come from the data, but from the people who experience this healthcare system firsthand. People like Julia Malott who posted the harrowing experience of her daughter who was waiting for surgery for over 18 hours and could not eat or drink anything.
Or from another Twitter account whose elderly mother was waiting in the ER for 13 hours because no beds were available.
Or another who has been waiting for over 6 months to see a general practitioner.
We have Stefan here who has experienced healthcare in the United States and sees it as a far better place to receive treatment.
Even a personal family experience, a 14 month wait to see an endocrinologist, a psychiatrist who spends an average of 1 minute and 30 seconds with a patient, and a GP who spends more time on vacation than in the office, with the inability to get prescriptions lest they take the mandatory appointment. Not to mention, asking for specific bloodwork only to be told “oh, we can’t do that test here.” Well, you know where you can see an endocrinologist, psychiatrist, GP, and get a host of bloodwork done in a matter of a month? I think you know the answer.
A troubling report recently came out reflecting that Canada was ranked dead last in primary healthcare when surveying 10 wealthy nations. Not only last in primary healthcare, but they also ranked last in same/next-day appointments to see a doctor, and that 39% of Canadians with a chronic condition had no access to primary care. Considering Canada is a G7 nation – as in one of the world’s seven largest economies – our healthcare certainly doesn’t reflect this. There is much more to be discussed related to Canadian healthcare, such as the controversy with MAID, or recent health policies at the provincial and federal level. One question I have to ask is who is keeping this narrative afloat? I truly think not enough Canadians are looking at this critically, to see the troubling issues surrounding our supposed “free and beautiful” healthcare system. I think it’s time we be honest with ourselves and provide truth to these misconceptions.
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