Canadian Medicare Presentation at Hofstra University
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Canadian Medicare Financing & Spending
Presented by Steven A. Rohinsky
Hofstra University MHA Program
Financing
Medicare
Financed by Provincial and Federal Governments
75% Financed through the Public Sector
25% Financed through the Private Sector
Funded through the revenue generated by taxing personal and corporate income.◦ Each Province has different Provincial tax Laws
Funding also through user Premiums◦ Premiums differ from Province to Province
Financing
Medicare Funding
Federal Government ensure “Basic Needs” are paid for.◦ Hospitals◦ Physicians◦ administration
Added benefits given by provincial government, Employer and Private insurers.◦ Eye Care ◦ Dentistry ◦ Home care (including Rehab unless done in hospital)◦ Prescription Drugs
Financing
Medicare
What are governments and Canadians spending?
Where is the growth? What are we spending it on? Whom do we spend it on? How does Canada compare?
Health Spending in Canada
Financing
Spending on health care by Governments and Canadians is projected to be: $148 billion- a 5.8% increase from 2005 10.3% of GDP $4,548 per person
2006 Health Care Spending Highlights
Financing
Components of Growth in Total Health Spending 2006
0.9%
2.1%
2.8%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
Increase Due toInflation
Increase Due toPopulation Growth
Real Increase inHealth Spending
5.8%
Financing
**Health Care Spending Outpacing Inflation and Population Growth
2.8% 2.8%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
1976 78 80 82 84 86 88 90 92 94 96 98 00 02 04 2006
Year
ActualForecast
1976-2004 Average (2.5%)
Total Health Expenditure per Capita, Annual Growth Rates in Constant $1997
Source: Canadian Institute for Health Information.
Financing
Total Health Expenditure per Capita (in US$)
Total Health Expenditure % of GDP
Public Share of Total Health Expenditure
Public-sector Health Spending per Capita (in US$)
Canada $3,165 9.9% 69.8% $2,210
U.S. $6,102 15.3% 44.7% $2,727
Note: All numbers represent 2004 data. Spending per capita was converted to U.S. dollars using purchasing-power parities for GDP.
Source: OECD Health Data 2006, October Edition.
Financing
Canada vs. United States
Total Health Expenditure as a Proportion of GDP
8.9%
8.3%
10.0% 10.3%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
1975 78 81 84 87 90 93 96 99 02 05
Year
ActualForecast
2006
Sources: Canadian Institute for Health Information; Statistics Canada.
Financing
Source: Canadian Institute for Health Information. Note: Data are for 2004.
Non-Consumption
3%
Out-of-Pocket15%
Private Health Insurance
12%
Public Sector
Private Sector
P/T Government
Sector64%
Municipal Government
Sector1%
Social Security Funds
1%
Federal Direct Sector
4%
Who Spends What?
Financing
Public / Private Split
70.8%75.1%
29.2%24.9%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Public Sector SharePrivate Sector ShareForecast
77.0%
70.3%
23.0% 29.7%
(% share)
Public- and Private-Sector Shares of Total Health Expenditure
Source: Canadian Institute for Health Information.
2006
Financing
What Are We Spending It On?
Capital4.1%
Public Health 5.8%
Other Health Spending
6.4% Other Institutions
9.4% Other Professionals 10.6%
Physicians 13.1%
Drugs 17.0%
Hospitals29.8%
Total health expenditure forecast for 2006 = $148 billion
Administration 3.9%
Source: Canadian Institute for Health Information.
Financing
Changing Look of the Health Care System
Source: Canadian Institute for Health Information.
13%
9%
60%9%
9%
Hospitals and Physicians
LTC
Other Professionals
Drugs
Other Expenditures
20%
17%43%
11% 9%
Hospitals and Physicians
LTC
Other Professionals
Drugs
Other Expenditures
1976 2006
Financing
Annual Growth on Selected Services in 2006 vs. Average Annual Growth of the Previous 10 Years
5.7%
5.8%
7.1%
6.0%
4.8%
4.8%
0% 1% 2% 3% 4% 5% 6% 7% 8% 9% 10%
Other Professionals
Hospitals
Other Institutions
Drugs
Physicians
Total HealthSpending
Note: Average annual growth in brackets.
Source: Canadian Institute for Health Information.
(6.6%)
(5.1%)
(5.5%)
(8.9%)
(5.7%)
(6.3%)
Financing
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
Que. P.E.I. N.L. N.B. B.C. N.S. Sask. Ont. Man. Alta.
Public Private
Y.T.: $6,669N.W.T: $7,300Nun.: $10,285
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
Que. P.E.I. N.L. N.B. B.C. N.S. Sask. Ont. Man. Alta.
$per capita Canada $4,548
Total Health Expenditure, Per Capita, Provinces and Territories, 2006
Source: Canadian Institute for Health Information.
Financing
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
Que. P.E.I. N.L. N.B. B.C. N.S. Sask. Ont. Man. Alta.
Public Private
PublicY.K.: $5,297N.W.T: $6,545Nun.: $9,792
Private$1,372$755$493
Total Health Expenditure, Per Capita, Provinces and Territories, 2006
Source: Canadian Institute for Health Information.
Financing
10.7%
13.1%
10.6%
6.9%
10.8% 10.3%
13.6%
9.8%
13.5%13.2%
10.8%
0%
2%
4%
6%
8%
10%
12%
14%
16%
N.L. P.E.I. N.S. N.B. Que. Ont. Man. Sask. Alta. B.C. Canada
Y.K.: 13.3%N.W.T: 7.6%Nun.: 27.5%
Total Health Expenditure as a Proportion of GDP, 2006
Source: Canadian Institute for Health Information.
Financing
Total Provincial/Territorial Government Health Expenditures, Per Capita
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
$8,000
$9,000
$10,000
<1 1–64 65+ Total
1998 2004
Age GroupSource: Canadian Institute for Health Information.
Financing
Distribution of Provincial/Territorial Government Health Expenditures by Age Group
3% 3%
54% 53%
43% 44%
0%
10%
20%
30%
40%
50%
60%
1998 2004
<1 1–64 65+
Source: Canadian Institute for Health Information.
Financing
How Does Canada Compare?
Financing
Health spending is rising◦ …but not as quickly as it was◦ …and the public/private split is still close to 70/30
Spending highest for babies and seniors◦ Proportion spent on seniors has remained
relatively stable On the world stage
◦ Canada is among the world’s top 12 health spenders in terms of health care spending per person
◦ Canada is on par with over half of comparable OECD countries in terms of health care spending as a proportion of GDP
◦ Canada’s public share is less than many comparable countries
Health Spending in Canada
Financing
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