Canada’s much vaunted public health care system could come under serious strain as the economic slowdown and rising health costs put the system under increasing pressure.
A recently released report found that rising drug and hospital costs have pushed total health care costs to an estimated 10.7 percent of the country’s total GDP, the highest share ever recorded.
“People are using more prescription drugs, especially with an aging population,” noted Chris Kuchciak, the manager of National Health Expenditures with The Canadian Institute for Health Information (CIHI), which issued the report.
Canada’s current per capita health expenditures are currently US$2,984, fourth highest in the world and almost half the United States’ $5,448, the highest in the world, according to CIHI.
Drug costs have risen more sharply than any other portion of health care expenditures, found the report.
Kuchciak said the rise is due to higher costs for new drugs and more expensive drug treatment plans.
While Canada has fared remarkably well compared to most countries during the global economic crisis, lower oil revenues, slumping exports, and a shrinking manufacturing sector are predicted to curb economic growth. That could force the government to make hard decisions about how health care dollars are spent.
Like the United States, Canada also faces an aging generation of baby boomers that is expected to put the system under increased strain, especially when they hit their mid-70s and up. The CIHI report found that costs for the average Canadian are around $1,800 from ages 1 to 64, but rise exponentially at those ages, as high $21,209 for people between 85 and 89.
Statistics Canada, the national statistics agency, predicts that by 2015 aging baby-boomers 65 and over will outnumber children under 15, the first time such an age distribution will have ever occurred in Canada.
By 2031, the working population, aged 15 to 64, could shrink from 70 percent to 60 percent of the total population, decreasing tax revenues while increasing health care costs.
Canadian provinces, which administer public health care, are already calling on the federal government to increase moneys provided to the provinces to address existing health care funding shortages.
