If you’re from the United States, you may not realize that Canada also has a system that they call Medicare. The Canadian universal healthcare system began in 1947 when one province introduced the concept, then it spread across the country as federal cost sharing practices were implemented. In 1984, the Canada Health Act helped to formalize what had become a provincial patchwork of law that provided coverage to patients.
Although the system of care in Canada is often referred to as “universal” or “socialized” coverage, which is provides is a decentralized collection of different territorial and provincial insurance plans. These health plans cover a narrow set of services which are provided for free at the point of care.
It becomes the responsibility of each territory and province to then organize and deliver services while supervising providers. Total health spending accounts for about 11% of the GDP in Canada each year.
Here are the Canadian Medicare pros and cons to review.
List of the Pros of Canadian Medicare
1. It is a straightforward system of care that is provided to all Canadians.
If you’ve ever seen a bill from a healthcare provider in the United States, then you’ll know what kind of advantage this happens to be. You won’t have an elaborate bill when you receive health services in Canada. There are no deductibles to manage in Canadian Medicare. You won’t be worrying about co-pays in most circumstances. Medical paperwork is nowhere near the same.
30% of the financing is covered under private health expenses already, while insurance plans paid for by taxes provide free services at the point of contact. You are free to choose your own doctor or physician, as well as your own hospital. You’re not restricted to specific care providers because of where you live or what you earn.
2. Even with its flaws, it is one of the best systems in the world.
Canada ranks as one of the best countries in the world in several healthcare categories, including mortality rates from specific diseases, mental disorder fatalities, and better life expectancy.
Compared to the United States, the life expectancy rates in Canada are almost 3 years longer. Canadians live to an average age of 82.2 years with an infant mortality rate of 4.9 per 1,000. Americans live to an average age of 79.3 years with an infant mortality rate of 6.5 per 1,000. The average per capita health care expenditure of Canadians is also $5,300 per person, while in the United States it is over $9,400.
3. The primary care system in Canada is inclusive.
94% of Canadians approve of their system of universal primary care. To say that it is universal, however, is not quite accurate. Canada actually has 15 different health care systems that are in place. There is also a veterans’ healthcare system and one that is solely focused on provided First Nations care.
Strong access to primary care is linked to the promotion of public health. Gatekeeping in the system is provided through financial incentives, where specialists receive lower fees for patients who are not referred to them. There are over 2,500 times more primary are visits in the average province than there are orthopedic replacement services provided each day.
4. Private insurance is still available in Canada.
Two out of three Canadians purchase complementary coverage from private providers to cover healthcare needs that are not provided by the basic primary care package. That includes dental care, vision, medication, and private rooms in hospitals. If you live in Canada, you are not permitted to purchase private insurance which covers services that are provided at the provincial level.
In comparison, primary private insurance in the United States covers about 56% of the population. The remainder is covered by a government-mandated plan as well, such as Medicare or Medicaid.
5. There are multiple models of primary care delivery available.
Canadian Medicare provides a similar delivery of primary care services as you’ll find in the United States. You can visit with a solo physician, be a member of a group practice, receive team-based care, or be cared for by a nurse practitioner. This variety allows patients throughout the country to pick providers that they feel will best meet their needs without making them feel uncomfortable.
6. Canadian doctors might earn less, but they also have less overhead.
Doctors in Canada don’t make as much as physicians in other countries, most notably the United States. They do, however, have lower overhead costs to worry about and their working conditions are usually better.
One example of this is the cost of dealing with different insurance plans. Doctors in Canada do not have the need to charge more because they must pay for staff that coordinate with various insurance policies. Most doctors in the country have a single assistant who schedules appointments, handles phone calls, and manages the reception desk.
7. There is less student debt for doctors in the Canadian Medicare system.
In the United States, the average doctor who graduates with the degree they prefer in medicine will be at least $150,000 in debt. For Canadian doctors, their debt will be about $75,000. The malpractice fees in Canada are much lower because there is much less at stake with the provision of services.
Even if a treatment is unsuccessful, the cost of fixing it is mostly covered by the system already. People are able to remain insured for life under this system of care. Because of that structure, should a malpractice case occur, the future costs of care are not built into the award because the patient will receive guaranteed care already.
8. Canadian Medicare pays for travel costs.
Let’s say that you live in a rural community in Canada. There are no specialists available for you to see for a health issue which has come up. Under the system of care, the province will pay for your transportation needs to go see the closest provider. If that means you must fly there, then so be it. That is one of the most significant cost-savings measures that is available in the Canadian healthcare system.
In the United States, if you must travel somewhere to see a specialist for a specific need, then the cost is often on you. Some insurance policies may allow you to submit some costs for reimbursement. Your HSA might allow you to withdraw funds for travel costs. In most circumstances, however, it is up to you to fund how you make it to the doctor.
9. Even when insurance is required, it is free for most households.
For a family of four, the average provincial cost for the extra insurance costs that go outside of the basics are about $125 per month. Some families may see a little more or less, depending on their circumstances and location. Most employers will pick up the cost of this extra insurance like American employers pay for a portion of health insurance costs, which means it is still free to the family.
If you have been diagnosed with a disability, or if you are on public assistance, then the province picks up the extra cost on the monthly premium for you. Most families in Canada never need to write a check for services unless they want add-on policies, and even those are usually less than $100 per month.
10. You receive the same medication in Canada as you do anywhere else.
Some people believe that the Canadian Medicare system does not provide the same quality of drug access for treatments as other systems around the world. That is simply not true. The medicine that is provided to Canadians often comes from the same factories that produce drugs for other countries in the world. Pharmacies and pharmacists are regulated with more oversight as well, which means there is a good chance what you take in Canada is safer.
The costs of medication in Canada are also significantly lower than they are for other countries, especially compared to the United States. The government of Canada regulates drug prices, so the differences are quite astounding. Just 10ml of Humalog, which lasts one month, costs about $250 out of pocket in the U.S., but it only costs $32 in Canada.
11. There is no such thing as rationed care in Canadian Medicare.
People who have a disability, along with veterans and the elderly, receive tremendous levels of care within the Canadian Medicare system. People are not “thrown to the curb” or have their healthcare rationed, as some people think. As a whole, people in Canada living healthier, longer, and more productive lives because they have access to consistent care opportunities. Even family caregivers receive care within this system, offering outings and respite providers that allow people to maintain a semblance of normalcy while they handle caring for parents and children simultaneously.
12. People are still responsible for their own health.
There is this idea which percolates every so often that Canadians don’t take good care of themselves because they aren’t required to pay as much for their healthcare. The truth is about as opposite as one can get from that perspective. In Canada, taking care of your health is considered part of your citizenship. You do what is needed to prevent taking up space in the healthcare system. Taking care of yourself means ensure you take a sick day if you don’t feel good, going to the gym, and reducing your stress levels.
List of the Cons of Canadian Medicare
1. There can be long wait times for non-emergency procedures.
The wait times for healthcare services in Canada for specialists and non-emergency procedures can be quite long. According to a 2017 report by the Fraser Report, the median waiting time to see a specialist physician was 21.2 weeks between referral and treatment. That’s more than a week longer than what it was the year before and is the longest-ever recorded time in 25 years of tracking the data.
Wait times are based more on geographic location than any other issue. Patients in Ontario received specialist care within 16 weeks, while those in New Brunswick experienced a wait of 41 weeks. During this wait time, additional medical needs may develop which also require care.
2. Permitted fees are not based on the cost of living within the system.
Under Canada Medicare rules, healthcare providers are limited by the government as to what they’re permitted to charge. That caps their potential earnings, even with specialist procedures, which makes it difficult to pay back loans or maximize their earning potential. The limits which are enforced are not based on the cost of living for their area. Patients can still be charged for treatments and other needs if it falls outside of the narrow scope of free services.
3. Patients in urban areas typically receive better health coverage.
Under the system of healthcare which is available in Canada, the revenues are redistributed according to demographics. That means if you live in a rural area, your health services provider may not receive the funding required to cover their costs. Facilities in rural areas are usually improved at a slower rate as well, which means you may be required to go to an urban area for care anyway. That has created a unique separation in the quality of life in rural vs urban areas.
People who live in the rural areas of Canada have a higher premature death rate and a higher infant mortality rate than those living in urban and suburban areas. There are fewer doctors available, longer distances to travel, and it takes time to transfer people to receive the emergency care they may require.
4. It is a healthcare system that tends to be reactive instead of proactive.
Most healthcare systems are reactive, seeking to treat healthcare needs as they arise in patients. Unlike other care systems, however, there isn’t always an effort to be proactive in health and wellness with Canada Medicare. Promotion and prevention activities are increasing, but it is based on what is provided within the narrow scope of things. Many patients may not even be fully aware of what is available to them because of the overall lack of information that is present.
5. Government interventions mean there is politics in health decisions.
At the federal level, the provinces and territories in Canada are responsible for the policies and processes of the care that is provided. Anyone can access these services, but it is usually those who are poor or live in urban areas which use them the most. People with enough wealth use private services at clinics where the waiting lists tend to be shorter. That creates a system of care where the wealthy receive better care in a faster time, which pushes all socioeconomic groups to seek out their own political advantages to gain an extra foothold in their healthcare system.
6. The healthcare costs in Canada are often misrepresented.
The average household pays more than $11,000 per year on healthcare services. Even if they aren’t paying anything at the doctor’s office, they are paying taxes that help to fund the system of coverage that is made available to them. General government revenues bankroll healthcare in the country. Since 2004, the cost of healthcare insurance has increased by 53%, which is much lower than the increase in income (34.7%) over that same time.
When you purchase goods or services in Canada, you’re paying taxes that help to fund your healthcare. In some ways, if you don’t use it, then you lose the money you would have spent otherwise.
7. It takes forever to receive an MRI in Canada.
Even proponents of Canadian Medicare admit that the time it requires to schedule an MRI for patient care in the country is extraordinarily long. When people cross the U.S. border for medical services, it is this type of scan that they receive. MRIs are easy to obtain in most U.S. cities, but they can take several months to schedule in Canada. If you’ve had an injury that is deemed to be not a threat to life, you could be dealing with pain for a prolonged time.
8. Not every doctor is willing to take new patients in Canada.
This issue is not just a Canadian Medicare issue, but it does create problems in rural areas where there might not be any general practitioners with new availability. If you’re unable to see a GP, then your access to the healthcare system is somewhat limited. You can still see a doctor at a 24-hour urgent care facility in most locations if you don’t have a primary doctor for your family, but it isn’t as convenient.
9. Taxes are higher in Canada to support the healthcare system.
Canadians pay an average of 10% more in taxes each year compared to Americans, with two sales taxes making up the largest portion of that tax. There is a nationwide 5% sales tax which applies, then there is a provincial rate in HST, GST, and/or PST to consider as well. In Alberta, there is no provincial rate. Other provinces charge 10% total for those taxes. For low-income families, that means a greater portion of their income goes to the care they need when compared to high-income families, creating a system of inequality for cost responsibility.
These Canadian Medicare pros and cons will hopefully dispel some of the myths that exist about receiving healthcare in Canada. Although there are some glaring weaknesses in the system, such as the wait times for specialist care, the cost of services is much lower. They quality of care received is comparable or better to anyone else in the world. Maybe that is why so many Canadians take pride in their unique system of care.
Blog Post Author Credentials
Louise Gaille is the author of this post. She received her B.A. in Economics from the University of Washington. In addition to being a seasoned writer, Louise has almost a decade of experience in Banking and Finance. If you have any suggestions on how to make this post better, then go here to contact our team.