Canada Health Profile 2012

HOW HEALTH CARE SERVICES ARE DELIVERED

Canada’s publicly funded health care system is best described as an interlocking set of ten provincial and three territorial health insurance plans. Known to Canadians as “medicare,” the system provides access to universal, comprehensive coverage for medically necessary hospital and physician services. These services are administered and delivered by the provincial and territorial (i.e., state or regional) governments, and are provided free of charge. The provincial and territorial governments fund health care services with assistance from the federal (i.e., national) government. In order to receive their full allocation of federal funding for health care, the provincial and territorial health insurance plans must meet five criteria — comprehensiveness, universality, portability, accessibility and public administration — that are provided in the federal government’s Canada Health Act.

In addition to setting and administering the Canada Health Act and providing funding, the federal government provides direct delivery of health care services to specific groups (e.g., First Nations people living on reserves; Inuit; serving members  of the Canadian Forces and the Royal Canadian Mounted  Police; eligible veterans). Many other organizations and groups, including health professional associations and accreditation, education, research and voluntary organizations, contribute to health care in Canada.

The responsibility for Aboriginal (First Nations people and Inuit) health services is shared by the federal, provincial and territorial governments, and Aboriginal organizations. The responsibility for public health is also shared.
The federal Public Health Agency of Canada acts as a focal point for disease prevention and control, and for emergency response to infectious diseases; however public health services are generally delivered at the provincial/ territorial and local levels.

What Happens First (Primary Health Care Services)

When Canadians need health care, they generally contact a primary health care professional, who could be a family doctor, nurse, nurse practitioner, physiotherapist, pharmacist, etc., often working in a team of health care professionals. Services provided at the first point of contact with the health care system are known as primary health care services and they form the foundation of the health care system.

In general, primary health care serves a dual function. First, it provides direct provision of first-contact health care services. Second, it coordinates patients’ health care services to ensure continuity of care and ease of movement across the health care system when more specialized services are needed (e.g., from specialists or in hospitals).

Primary health care services often include prevention and treatment of common diseases and injuries; basic emergency services; referrals to and coordination with other levels of care, such as hospital and specialist care; primary mental health care; palliative and end-of-life care; health promotion; healthy child development; primary maternity care; and rehabilitation services.

Doctors in private practice are generally paid through fee-forservice schedules negotiated between each provincial and territorial government and the medical associations in their respective jurisdictions. Those in other practice settings, such as clinics, community health centres and group practices, are more likely to be paid through an alternative payment scheme, such as salaries or a blended payment (e.g., fee-for-services plus incentives). Nurses andother health professionals are generally paid salaries that  are negotiated between their unions and their employers. When necessary, patients are referred to specialist services (medical specialist, allied health services, hospital admissions, diagnostic tests, prescription drug therapy, etc.).

What Happens Next (Secondary Services)

A patient may be referred for specialized care at a hospital, at a long-term care facility or in the community. The majority of Canadian hospitals are operated by community boards of trustees, voluntary organizations or municipalities. Hospitals are paid through annual, global budgets negotiated with the provincial and territorial ministries of health, or with a regional health authority or board. Alternatively, health care services may be provided in the home or community (generally short-term care) and in institutions (mostly long-term and chronic care). For the most part, these services are not covered by the Canada Health Act ; however, all the provinces and territories provide and pay for certain home care services. Regulation of these programs varies, as does the range of services. Referrals can be made by doctors, hospitals, community agencies, families and potential residents. Needs are assessed and services are coordinated to provide continuity of care and comprehensive care.
Care is provided by a range of formal, informal (often family) and volunteer caregivers. Short-term care, usually specialized nursing care, homemaker services and adult day care, is provided to people who are partially or totally incapacitated.

For the most part, health care services provided in long-term institutions are paid for by the provincial and territorial governments, while room and board are paid for by the individual; in some cases these payments are subsidized by the provincial and territorial governments. The federal department of Veterans Affairs Canada provides home care services to certain veterans when such services are not available through their province or territory. As well, the federal government provides home care services to First Nations people living on reserves and to Inuit in certain communities. Palliative care is delivered in a variety of settings, such as hospitals or long-term care facilities, hospices, in the community and at home. Palliative care for those nearing death includes medical and emotional support, pain and symptom management, help with community services and programs, and bereavement counselling.

Additional (Supplementary) Services

The provinces and territories provide coverage to certain  people (e.g., seniors, children and social assistance recipients) for health services that are not generally covered under the publicly funded health care system. These supplementary health benefits often include prescription drugs, dental care, vision care, medical equipment and appliances (prostheses, wheelchairs, etc.), independent living and the services of other health professionals, such as podiatrists and chiropractors. The level of coverage varies across the country. Those who do not qualify for supplementary benefits under government plans pay for these services with individual, out-ofpocket payments or through private health insurance plans.Many Canadians, either through their employers or on their own, are covered by private health insurance and the level of service provided varies according to the plan purchased. Trends/Changes in Health Care The Canadian health care system has come under stress in recent years, due to a number of factors, including changes in the way services are delivered, fiscal constraints, the aging of the baby boom generation and the high cost of new technology. These factors are expected to continue in the future. Since publicly funded health care began in Canada, health care services and the way thy are delivered have changed from a reliance on hospitals and doctors to alternative care in clinics, primary health care centres, community health centres and home care; treatment using medical equipment and drugs; and public health interventions. The number of acute-care hospitals and acute-care hospital beds decreased from 1995 to 2000. Medical advances have led to more procedures being done on an out-patient basis, and to a rise in the number of day surgeries. During this time, the number of nights Canadians spent in acute-care hospitals fell by 10%. Post-acute or hospital alternative services provided in the home and community have  grown, with reforms such as hospital consolidation, less time spent in hospitals, growth in day surgery, etc. Other reforms have focused on primary health care delivery, including setting up more community primary health care centres that provide services around-the-clock; creating primary health care teams; placing greater emphasis on promoting health, preventing illness and injury, and managing chronic diseases; increasing coordination and integration of comprehensive health services; and improving the work environments of primary health care providers.

Coordinated primary health care teams include family doctors, nurses, nurse practitioners and other health professionals, and provide a broad range of primary health care services. These team members can vary according to the needs of the community they serve, and provincial and territorial priorities. This team approach, along with the introduction of medical telephone call centres (telehealth), reduces the use of emergency units by providing advice and after-hours access to primary health care services. Most provinces and territories have tried to control costs and improve delivery by decentralizing decision making on health care delivery to the regional or local board level. Such regional authorities are managed by elected and/or appointed members who oversee hospitals, nursing homes, home care and public health services in their area.

THE ROLE OF GOVERNMENT

The organization of Canada’s health care system is largely determined by the Canadian Constitution, in which roles and responsibilities are divided between the federal, and provincial and territorial governments. The provincial and territorial governments have most of the responsibility for delivering health and other social services. The federal government is alsoresponsible for some direct delivery of services for certain groups of people. Publicly funded health care is financed with general revenue raised through federal, provincial and territorial taxation, such as personal and corporate taxes, sales taxes, payroll levies and other revenue. Three provinces, British Columbia, Alberta and Ontario, charge health care premiums, but non-payment of a premium does not limit access to medically necessary services. The competitive advantage that publicly financed health care provides to Canadian business is significant. Public financing spreads the cost of providing health services equitably across the country. In addition, financing health insurance through the taxation system is cost-efficient because it does not require a separate collection process.

There is more to health than the health care system. The responsibility for public health, which includes sanitation, infectious diseases and related education, is shared between the three levels of government: federal, provincial/territorial and local or municipal; however,as noted above, these services are generally delivered at the provincial/ territorial andlocal levels.

The Federal Government

The federal government's role in health includes setting and administering national principles for the system under the Canada Health Act; financial support to the provinces and territories; and several other functions, including the direct delivery of primary and supplementary services to certain groups of people; public health programs to prevent disease, and to promote health and educate the public on health implications of the choices they make; health protection (food safety and nutrition, and regulation of pharmaceuticals, medical devices, consumer products and pest management products); and funding for health research and health information activities.

The Canada Health Act establishes the principles and criteria for health insurance plans that the provinces and territories must meet in order to receive full federal cash transfers in support of health. The Canada Health Act lists five basic principles, which state that health care plans must be: available to all eligible residents of Canada; comprehensive in coverage; accessible without financial and other barriers; portable within the country and during travel abroad; and publicly administered.

The federal government provides cash and tax transfers to the provinces and territories in support of health through the Canada Health Transfer. To support the costs of publicly funded services, including health care, the federal government also provides equalization payments to less prosperous provinces and territorial financing to the territories.

Approximately 1 million people in certain groups receive primary and supplementary health care services directly from the federal government. These groups include: First Nations people living on reserves; Inuit; serving members of the Canadian Forces and the Royal Canadian Mounted Police; eligible veterans; inmates in federal penitentiaries; and refugee protection claimants.

Direct delivery of services to First Nations people and Inuit includes primary care and emergency services on remote and isolated reserves where no provincial or territorial services are readily available; communitybased health programs both on reserves and in Inuit communities; and a non-insured health benefits program (drug, dental and ancillary health services) for First Nations people and Inuit no matter where they live in Canada. In general, these services are provided by community health nurses, and at nursing stations; health centres; in-patient treatment centres; hospitals; and on-reserve headstart projects for Aboriginal children. Increasingly, both levels of government are working together to integrate the delivery of these services with the provincial and territorial systems.

The federal government is also responsible for health protection and regulation (e.g., regulation of pharmaceuticals, food and medical devices), consumer safety, and disease surveillance and prevention, and provides support for health promotion and health research. There are also federal health-related tax measures, including tax credits for medical expenses, disability, caregivers and infirm dependents; tax rebates to public institutions for health services; and deductions for private health insurance premiums for the self-employed.

The Provincial and Territorial Governments

The provinces and territories administer and deliver most of Canada's health care services, with all provincial and territorial health insurance plans expected to meet national principles set out under the Canada Health Act. Each provincial and territorial health insurance plan covers medically necessary hospital and doctors' services that are provided free of charge, without deductible amounts, co-payments or dollar limits. The provincial and territorial governments fund these services with assistance from federal cash and tax transfers.

The role of the provincial and territorial governments in health care includes administering their health insurance plans; planning, paying for and evaluating hospital care, physician care, allied health care, prescription drug care in hospitals and public health; and negotiating fee schedules for health professionals. Most provincial and territorial governments offer and fund supplementary benefits for certain groups (e.g., low-income residents and seniors) such as drugs prescribed outside hospitals, ambulance costs, and hearing, vision and dental care, that are not covered under the Canada Health Act.

Although the provinces and territories provide these additional benefits for certain groups of people, supplementary health services are largely privately financed. Individuals and families who do not qualify for this publicly funded coverage may pay these costs directly (out-of-pocket), be covered under an employment-based group insurance plan or buy private insurance. Under most provincial and territorial laws, private insurers are restricted from offering coverage that duplicates that of the publicly funded plans, but they can compete in the supplementary coverage market.

Health Expenditures

Within the publicly funded health care system, health expenditures vary across the provinces and territories. This is, in part, due to differences in the services that each province and territory specifies to be medically necessary and on demographic factors, such as a population's age. Other factors, such as areas where there are small and/or scattered populations, may also have an impact on health care costs.

In 1975, total Canadian health care costs consumed 7% of the Gross Domestic Product (GDP). Canada's total health care expenditures as a percentage of GDP grew to an estimated 10.4% in 2005 (or $4411 CDN per person). 1 According to the Canadian Institute for Health Information, in 2005, on average, public health expenditures accounted for seven out of every 10 dollars spent on health care. The remaining three out of every 10 dollars came from private sources and covered the costs of supplementary services such as drugs, dental care and vision care.

How health care dollars are spent has changed significantly over the last three decades. On average, the share of total health expenditures paid to hospitals and physicians declined, while spending on prescription drugs has greatly increased. Still, expenditures for hospitals and physicians take 43% of the amount that is directed to health care.

In 1975, a much larger share went to hospitals (45%) than in 2005 (30%). Payments to physicians in 1975 (15%) accounted for the second largest share of expenditures; this declined to the third largest area of spending (13%) by 2005. 4 In contrast, drug therapies, particularly those prescribed by physicians, accounted for 9% of total health expenditure in 1975. This had nearly doubled by 2005, and at almost 18% had become the second largest share of total health expenditure.