Unlike the private health care system used in the United States, Canadian health care is a single payer system. Physicians and hospitals are private entities, but their services are paid for by the government. The government covers these costs through taxes paid by citizens. The system has advantages over the U.S. approach, but there are drawbacks too.
History of Health Care in Canada
The move toward the country's current approach to health care started in 1946. The province of Saskatchewan (in the center of the country between Alberta and Manitoba) suffered from doctor shortages, so the towns began to help doctors start their practices in the province. Eventually, Alberta started a similar program and was able to offer coverage to 90 percent of the province's population. By 1957, the Hospital Insurance and Diagnostic Services Act had passed, and in just four years all 10 provinces agreed to participate. The act required all provinces to pay half of the medical costs for their citizens. That was increased in 1966 under the Medical Care Act, which set up the current system, called Medicare (not to be confused with the U.S. program for the elderly).
The Organization of the System
Under the system, each province can establish its own universal health care policies. Coverage varies depending on where you live, but most procedures deemed medically necessary are paid by the government. Each resident receives a health card issued by the province. This card is shown when medical services are provided, as Americans might show their insurance cards. No co-payments are required, however. As in many American health insurance plans, the family doctor is the primary point of care but can refer patients to specialists. Patients can choose to see specialists without a referral, but those costs usually have to be paid by the patient.
The Public and Private Mix
Although most people assume the Canadian Medicare system is completely public, that's not the case. Doctors are not paid a salary by the government but instead receive a pre-negotiated fee each time they see a patient. That fee is determined by physician organizations and the provincial governments. Doctors are not permitted to charge more than that fee unless they want to be removed from the Medicare system, which most do not. Additionally, private insurance is available to supplement what is provided by the government. About 65 percent of Canadians have some type of private insurance that helps with costs not fully covered by the system, such as prescriptions. Employers often provide this supplemental insurance as a benefit to workers. Other types of medical services, including optometry services, are wholly private.
Advantages of the Canadian System
The biggest advantage of the Canadian health care system is widespread coverage for all citizens regardless of income. Although not all medical needs are completely covered by the government, price controls on prescriptions allow patients to afford the treatments they need. Although health care spending is high in Canada, accounting for more than 10 percent of the gross domestic product, it is less than is spent in the United States.
Disadvantages of the Canadian System
A major disadvantage of the system is wait times. Because some services are limited, patients may wait considerably longer to have elective surgeries, to be seen in an emergency room or to have some types of diagnostic tests. For example, in 2004 the average wait to have an MRI was 22 months. A survey conducted in 2006 found that 40 percent of Canadians who had elective surgery had to wait up to three months for it. Other disadvantages include a shortage of physicians and limitations on private delivery of health care.
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