Americans need to know Canada’s health care system is not free

Image of digital OHIP card when old card replaced in 1995.

Given that the Republican and President Trump’s Obamacare repeal and replace health care bill just died in the Congress, I want to remind Americans that a health care system like we have in Canada is neither a single payer system, nor is it free.

Let me explain. Health care in Canada is governed by the five principles of the federal Canada Health Act (CHA): (1) that it is Publicly Administered, (2) that it is Comprehensive, (3) that it is Universally available to everyone, (4), that it is Portable throughout the country, and (5) it is Accessible.

While technically, all ten provinces and three territories must adhere to those principles, officials tend to interpret those principles in different ways.

In Quebec, for example, private clinics are allowed to operate. In Ontario, we have a private hernia hospital in Toronto called Shouldice but other than that, private clinics where patients pay out of their own pocket, are not allowed. In BC, a private clinic is taking the government to court arguing that by making patients wait weeks or months for medically necessary services and not allowing them to purchase private services, the government is contributing to the patient’s decline.

The difference in Ontario is that while most community-based labs and clinics are for-profit, Ontario citizens simply provide their OHIP (pronounced O-hip) health card (as shown in the above image) and the for-profit bills the government directly for payment.

So, where does the money actually come from? Using the Province of Ontario, where I live, as an example, funds come from three sources;

  1. Middle & Large business health tax revenue;
  2. Block Grants from the federal government; and
  3. Individual Health Care Premiums.

In the case of Ontario Health Care Premiums, which are deducted from a person’s pay cheque or paid annually on their income tax, payments can vary from $300.00 to $900.00 depending on income level. Individuals who earn less than $20,000 or are receiving disability or social assistance benefits are not expected to contribute.

Those three sources of revenue cover emergency or catastrophic services at a doctor’s office or hospital, including surgery, specialized procedures like angiograms, angioplasty, x-rays, MRI’s, CAT scans, nutrition advice, meals and blood work. Also covered, in hospital, are dental surgery (following an accident or having teeth extracted), prescription medications and physiotherapy.

However, out of hospital, only those who are on disability, social benefits or are 65 or older, get some of their prescription medications covered. As well, most dental and para-medical services such as physiotherapy, massage therapy, chiropractor and naturopath are not covered and individuals must pay personally or via supplementary insurance coverage, either through an employer, pension plan or privately. However, in certain situations, like cancer treatment, there is an Ontario program for catastrophic prescription coverage, such as Trillium.

Anyway, given the purpose for this post was to show Americans how much each Canadian actually pays, let’s figure out what a retiree couple averaging a $50,000 a year household income (through a combination of self-funded retirement funds, employer pensions, Canada Pension Plan payments and Old Age Security) would pay.

  • They will pay $1,200.00 (600.00 each) on their income tax forms for their “health care premium;” and
  • They will pay approximately $350.00 per month for a supplemental major medical package if they include dental coverage.

Which is $5,400.00 CAD a year.

The crux of the matter is that, while Canadians do not have to worry about deductibles or paying at the time they access health care services, their health care coverage is definitely not the “single payer system” far too many American officials say it is, nor is it “free.”

Something for Americans to think about.