Analysis of Canada’s Healthcare System

Analysis of Canadas Healthcare System INTRODUCTION Canada is a developed country located in the northern part of North America. In 1867, it became a self-governing state while retaining its tie with the British crown. When it comes to economic and technology, Canada is developing in parallel to its neighbour to the south, which is the United State of America. It is a member of the Commonwealth of Nations, with a democratic constitutional monarchy as their form of government. In the past years, Canada’s politics faces the challenges of reaching the population’s demands for quality improvement in education, social services, economic competitiveness and health care. The health care system in Canada is funded publicly and delivered on a provincial or territorial basis, within a guidelines set by the federal government (Canadian Health Care, 2007). Every Canadian citizens are provided with preventative services and medical treatments from general practitioners at the same time having access to hospitalisation, dental surgery and other medical services. However, in the past few years Canada’s Healthcare System is facing controversy because of it’s soaring costs. I NCREASING COST OF UNIVERSAL HEALTH CARE IN CANADA According to a latest study (Esmail N., Palacios M., 2013), conducted by the Fraser Institute with the title â€Å" The Price of Public Health Care Insurance: 2013 Edition †, the average Canadian household now pays approximately $7,860 in taxes for ‘health care insurance.’, which is 53.3% higher than of in 2003. Over the past decade the cost of healthcare in Canada doubled and is believe to exceed the $200 billion budget mark. Canada’s health care costs continue to grow at a faster rate than the government’s revenue, largely driven by spending on prescription drugs. In the last five years, however, growth rates in pharmaceutical spending have been matched by hospital spending and overtaken by physician spending, mainly due to increas ed provider remuneration (Marchildon G., 2013). In addition, this trend is also caused by what the health system spends on doctors, which rose by an average of 6.8 % every year. Of that value, 3.6% was caused by the increase in physician’s fees. Other driving factors for the increase in healthcare costs are population growth, aging population and increased health care demand. Consequently, this rise in Canada’s universal health care costs is said to be the reason why the government has limited ability to provide other services such as education, transportation and pension benefits. Increased health care costs will results into higher labor costs, which might cause companies to hire lesser workers, produce less output, or raise their prices. The high expenditure for health causes the budget for other government programs and priorities be restricted. EFFECT ON CANADA’S ECONOMY The abrupt rise in health care costs and insurance can affect several parts of the econo my. The rise in health care costs can cause job growth to slow down because it costs companies more money to add new employees. Wage increases have also slowed for current employees, since companies must spend more money on health care premiums. The public sector includes the federal, state and municipal governments. The public sector is dealing with costs rising more than revenues. This places a high degree of examination on discretionary health care spending. Companies are faced with rising health care spending often cut other expenses, such as reducing health care benefits, requiring employees to pay a larger share of their health care benefits, or reducing wage increases.