What Is Right about
the Canadian Health Care System?
by Robert Evans and Noralou P. Roos
University of British Columbia, Vancouver; University
of Manitoba, Winnipeg
Physicians for National Health Plan (PNHP) newsletter,
Canadians are remarkably masochistic. Year after year, the
United Nations reports that Canada is the most livable country
in the world; yet we seem to discuss nothing but how to dismember
the elements that makes it so. Canada has one of the world's most
successful health care systems. Yet we cannot shake the belief
that, despite all evidence, the grass is greener south of the
border. Although our system is fundamentally sound, we dwell on
its problems and insist on looking for magical fixes from the
Americans, whose health care system is generally recognized as
being among the least satisfactory in the developed world.
The truth is, there is no shortage of good news about the
Canadian health care system; why we hear this so rarely is a matter
that should concern us.
For example, Canadians are healthy. On average, we are among
the healthiest people in the world, and we are becoming healthier.
Wide variations exist by region and social group, and we rightly
hear much about these. However, Canadians' general health is high
and rising. In particular, on the standard measures of life expectancy
and infant mortality, we outperform the United States, which records
eight infant deaths per thousand live births, placing it in the
same league as the Czech Republic and Greece; the Canadian rate
is six per thousand. Canadians also live longer, and our advantage
is growing. From 1990 to 1995, the gap in life expectancy between
Canadian and American males grew from 2 to 2.8 years; for women,
it went from 1.6 to 1.9 years.
The widening gap in life expectancy, with Canada pulling ahead,
is true not only for the entire population but also for the elderly.
Even the one group of Americans with access to Medicare, those
65 years and older, find their health improving more slowly than
do the elderly of any other major country. Elderly people living
in the United States only gained three years of life expectancy
between 1960 and 1996 (going from 14.3 to 17.3 years), whereas
the median gain for the elderly in countries that belong to the
Organisation for Economic Development and Cooperation was 3.4
years. Canadian elderly also experienced a 3.4 year increase in
life expectancy over this period (going from 14.9 years to 18.3
Different health care systems are not the whole, or even the
principal, explanation for Canadians' better health. The American
social environment is more brutal for the less successful. In
simple economic terms, for example, everyone knows that Americans
enjoy higher incomes, on average, than do Canadians. Little known,
and rarely reported in either country, is the fact that in the
United States a much larger-and growing-proportion of total income
goes to those at the very top of the income distribution. Thus,
although the rich in America are much richer, the poor are much
poorer than their Canadian counterparts. In 1995, although the
top 20 percent of U.S. families were substantially better off
than their Canadian counterparts, most of the rest-roughly half
of all families-were absolutely worse off than the corresponding
socioeconomic groups in Canada. The difference is largely attributable
to Canada's structure of tax-financed social programs.
Why is this important? There is strong evidence of a link
between income distribution and overall health status: inegalitarian
societies, as exemplified by the United States, which concentrate
wealth in the hands of a few, tend to be unhealthy.
Obviously, health care also matters, and the Canadian health
care system is very good at delivering care to the people who
need it, whether or not they can pay. Cross-border, comparative
studies suggest that both the Canadian and American systems serve
people in middle- and upper-income groups well, but that there
are marked differences in access to care and outcomes for people
with lower incomes. It would be very surprising if this were not
so. About 40 million Americans have no insurance at all, and those
who are covered increasingly face large user fees.
Nevertheless, even if we grant that Canada does better at
looking after poor people and directing care to those who need
it most, the fact is that most of Canadians are not poor. Aren't
we being short-changed by an inadequately funded system that is
simply incapable of meeting all our needs? The United States may
not distribute care equitably, but at least-in contrast to Canada,
it delivers the goods. Or does it?
Americans certainly spend a lot more on health care than Canadians
do, or, for that matter, than anyone else in the world. One-seventh
of U.S. national income, 13.6 percent, goes to health care, compared
with 9.3 percent in Canada and 8 to 10 percent in most developed
countries. Thus, Americans' yearly expenditure on medical care
works out to be $4,090 per capita, compared with $2,095 (U.S.)
spent by Canadians. It is not that Canada spends so little-Canada
has long been counted among the countries that spend the most
(in 1997 only Switzerland, at $2,547, Germany, at $32,339, and
Luxembourg, at $2,340, spent more), but that the United States
spends so much. To match these levels, Canada would have to add
$45 billion a year to its health care spending.
But do Canadians really want to do that? The truth is that
more money does not necessarily buy more health care, any more
than it buys more health. Americans receive neither more hospital
care nor more physician services, although they pay a lot more
for the care they do receive. (Yes, Americans have higher rates
of some types of surgical procedures, but, in general, Canadians
undergo more surgery.) Americans do not receive higher-quality
care for their money; follow-up studies of patients on both sides
of the border usually show similar outcomes. There is no clear
advantage to either side.
The Canadian health care system is also remarkably efficient.
Lamentations about our bloated, inefficient administrative bureaucracies
are pure fiction. A universal, comprehensive, tax-financed public
insurance system with negotiated fee schedules is administratively
"lean." The American multi-payer system, with its diverse
and complex coverage restrictions and elaborate forms of user
payments, is "fat." The American private insurance bureaucracy
is huge; its excess administrative costs, compared with those
characterizing a Canadian approach, are estimated to exceed between
10 and 15 percent of total system costs, or well over US$100 billion
But what about the "Canadian problem"-waiting lists?
In the United States, people without money or insurance do not
even get on a waiting list. Access is rationed by ability to pay,
not by waiting. (They may gain access to care at some public facilities;
but then they wait.)
If the Canadian waiting lists indicate a problem, it is not
one for which the Americans have an acceptable solution. Canada
could do a better job of managing patients who are awaiting surgery.
Most provinces have no system for prioritizing these patients.
(Ontario's Cardiac Care Network is a notable exception.)
However, reviews of waits in Canada have found that the system
provides immediate access for emergency cases and rapid access
for urgent ones. Because there have been remarkable increases
in the numbers of cataract, bypass, hip, and knee procedures performed
in Canada in recent years, rationing of care is no longer a real
Claims of excessive waiting lists are the "political
theater" of publicly funded health care everywhere in the
world. In fact, when asked, most Canadians on waiting lists do
not find their waits problematic. Claims of under-funding play
an obvious role in the bargaining process between providers and
governments. The former cry, "More money for health!";
they mean higher incomes for themselves.
Why, then, do American notions keep pushing north? There is
a great deal of money to be made by wrecking the Canadian system
of Medicare. All the excess costs of an American-style payment
system represent higher incomes for both the insurance industry
and providers of care. The extra $45 billion it would cost us
to match American expenditure patterns is a big enough carrot
to motivate promoters of the illusion of American superiority.
We ate left with the question: what's really right about the
Canadian health care system? Compared with the American system,
just about everything. We do have problems, but the Americans
do not have the solutions.