Universal Health Coverage: The Canadian Experience

1. Universal Health Coverage:The Canadian Experience PAHO Working Group on Universal Health Coverage Washington D.C. August 18-20, 2014

2. The Canadian Federation The Canadian federation is a decentralized federation with ten provinces and three territories Total population of 35 million inhabitants Significant variations in provincial and territorial population Ontario: 13 million Quebec: 8 million Newfoundland: 526,000 Prince Edward Island: 145, 000

3. Health Expenditures in Canada (2013) Source: Canadian Institute for Health Information

4. Roles and Responsibilities in the Health Sector • Provincial/territorial governments have primary responsibility for the organisation and delivery of health care services • Federal government provides financial support to provinces and territories to help them fulfill their responsibility to provide health care to their residents • Federal government provides supplementary coverage for groups such a First Nations, Inuits and veterans • Federal government also supports health research, and is responsible for regulating prescription drugs and medical devices for safety and efficacy

5. Health System Financing • Public Financing • 70% of all health expenditures • Tax-based system • About 60% of the public financing is used to pay for hospital and physician services • Private Financing • 30% of all health expenditures • Divided between out-of-pocket payments (15%), private health insurance (12%), and other (non-consumption) sources (3%) • The 70/30 public-private ratio has not changed much over the last 30 years

6. Health Coverage in Canada: Universal Medicare Versus Additional Health Benefits R Medicare Hospital and Physician Services

7. Medicare Program (1) • Medicare was implemented gradually in the 1950s and 1960s • Program is administered by provinces/territories, but the operating principles are defined by federal legislation (i.e., Canada Health Act) • The provincial/territorial program must be publicly administered • Eligibility must be based on residency (universal coverage on uniform terms and conditions) • Coverage must be prepaid and applicable to the first dollar (no co-payment/no deductible) • Coverage must be comprehensive (from basic consultation with a primary care physician to advanced tertiary care) • Coverage must be portable (coverage remains when people move or travel to another province )

8. Medicare Program (2) • Medicare Regulatory Framework • Hospitals are required to participate in Medicare (no opting out) • Physicians can opt out of Medicare and charge patients directly, but they cannot dual practice (that is practise in and out of Medicare at the same time) • Physician remuneration (e.g., fee schedule) is negotiated at the provincial level • Physicians must accept public payment as full payment for their services (no extra-billing) • Private insurance is prohibited for hospital and physician services (no private parallel system)

9. Coverage for Additional Health Benefits (1) • Additional health benefits include prescription drugs outside hospitals, dental care, vision care, home care, and nursing home care • These benefits are covered by a mix of public programs and private health insurance • Public programs • Targeted to specific groups (e.g., seniors, people on social assistance, children, people with disabilities or specific conditions) • Public programs are sometimes needs-tested or means-tested

10. Coverage for Additional Health Benefits (2) • Private health insurance (PHI) • Obtained through the workplace • PHI provides coverage to employees and their dependants • Limited to supplementary coverage (cannot duplicate Medicare coverage) • PHI is voluntary (employers not required to offer private insurance) • Financing involves experience-based premiums with co-payments and deductibles • Together, public programs and private health insurance provide coverage to more than 80% of Canadians (60% by PHI and 20% by public programs)

11. The Canadian Experience with Universal Coverage (1) • The policy of universal coverage is considered a great success and a major social policy achievement in Canada • It protects Canadians against the catastrophic costs that can be associated with major illnesses and injuries • It has improved the health status of the general population by removing the financial barriers (e.g., hospital user fees and extra-billing by doctors) that can preclude individuals and families from accessing needed health services

12. The Canadian Experience with Universal Coverage (2) • Universal coverage remains, to a certain extent, unfinished business • Despite the efforts of governments to provide greater financial protection to vulnerable groups, there are certain segments of Canadian society that are exposed to health service costs that can be significant, particularly for prescription drugs. • The challenge is to find ways to ensure that these groups have better access to prescription drugs and other essential health services, in a manner that is affordable and sustainable. • Provincial and territorial governments are experimenting with various approaches to drug coverage and home care (e.g., catastrophic coverage, social health insurance, etc.) • Federal government has committed to providing long term sustainable funding to provinces and territories, and supports the dissemination of best practices and innovative approaches to health care

13. Lessons from the Canadian Experience • Seize the momentum • The 1950s and 1960s were a very favorable period (politically, economically and socially) for implementing universal coverage in Canada • The current push for universal health coverage at the international level may create the kind of momentum that is needed to expand coverage • Adopt a strategic approach • Push for expanding coverage where the potential for success is the greater; then build on your success to move to the next stage • Keep in mind that health care is only one part of the broader health equation • Other determinants of health are important and they need also to be addressed, as much as possible, in a comprehensive way • Be cognizant that achieving universal coverage by relying on a mixed system of public programs and voluntary private health insurance can be very challenging