4/22/14

How Ontario public sector health care funding lags behind

Ontario health care spending ain't what it used to be

The Ontario public sector spends less than almost all other provinces on health care.  And it's falling further behind.  

Over the most recent four years per capita spending increased 9.7% across Canada, but only 5.2% in Ontario.  With this, the Ontario public sector spends less per person than any other province except Quebec. 



Ontario and Canadian per capita public sector health care spending in current dollars

Ontario public sector spending equaled $3,952 per person in 2013, but the all-Canada average was 6.3% (or $248) higher, at $4,200 per person, according to a new report from the Canadian Institute for Health Information (CIHI). 

Heading for the bottom: Quebec, alone, does spend slightly less than Ontario: $8 per year per person less.  But even that is changing.  In 2010, Quebec spent 7% less than Ontario, now they spend less than a quarter of a percent less.  


With  a policy of real cuts in Ontario,  per capita public sector spending on health care has gone up more quickly in Quebec than Ontario for the last five years.    In 2013 it increased 2.8% in Quebec but only 0.5% in Ontario.  


With official plans for many more years of austerity in Ontario, we will soon have the dubious honour of having the lowest public sector health care spending in Canada.


Expenditures in Ontario and Canada: Ontario public sector health expenditures were forecast to be up 1.8% in 2012 and 1.7% in 2013. This is a-third less than the Canada-wide averages of 2.7% and 2.5%. 


This despite the fact that population growth and population aging drive up health care costs more quickly in Ontario than Canada as a whole: 2.1% per year in Ontario, but only 1.6% in Canada as a whole.

Public sector health care expenditures in Ontario are not keeping up with the new costs associated with population growth and population aging -- never mind the impact of inflation or increased demand. 


Hospital funding low, but drug and physician spending is high: Total Ontario public and private spending on hospitals is less than any other province except Quebec: 5.5% or $97 per person less than Canada as a whole.  Ontario also spends less on “other institutions” (e.g.nursing homes) than all other provinces except BC and Alberta. 

But we spend more on drugs and physicians. 

Canada as a whole spends much more on drugs and doctors than other developed nations:  69% more per-person for doctors and 52% more for drugs than the OECD average according to CIHI data. 

As a result, Ontario is a world "leader" for high costs in those areas. Another dubious honour. 

2013
Hospitals
Drugs
Physicians
Other Professionals
Other Institutions
Total Expenditure
Exp. per Capita
Exp. as Percentage of Provincial Total
Exp. per Capita
Exp. as Percentage of Provincial Total
Exp. per Capita
Exp. as Percentage of Provincial Total
Exp. per Capita
Exp. as Percentage of Provincial Total
Exp. per Capita
Exp. as Percentage of Provincial Total










N.L.
2,597
36.4
1,020
14.3
927
13
480
6.7
891
12.5
P.E.I.
1,972
31
944
14.9
765
12
486
7.6
906
14.3
N.S.
2,011
30.9
1,080
16.6
818
12.6
653
10
874
13.4
N.B.
2,146
33.1
1,181
18.2
789
12.2
532
8.2
747
11.5
Que.
1,466
26.5
1,068
19.3
788
14.2
476
8.6
769
13.9
Ont.
1,676
28.7
1,010
17.3
942
16.1
568
9.7
601
10.3
Man.
1,942
29.3
879
13.2
899
13.6
624
9.4
808
12.2
Sask.
1,892
28.6
880
13.3
911
13.8
640
9.7
796
12
Alta.
2,379
35.1
933
13.7
986
14.5
773
11.4
519
7.7
B.C.
1,750
30.3
761
13.2
844
14.6
742
12.8
370
6.4
Y.T.
2,951
29.6
716
7.2
905
9.1
600
6
1,797
18
N.W.T.
4,238
39.7
719
6.7
1,186
11.1
651
6.1
837
7.8
Nun.
4,502
34.2
704
5.4
1,450
11
566
4.3
1,274
9.7
Canada
1,773
29.6
977
16.3
889
14.8
597
10
632
10.5

Private payment:  Ontario already has the even more dubious honour of having the largest portion of private health care spending: 32.3% of all health care spending compared to a Canada-wide average of 29.9%.  


That's part of the price of lower public sector spending in Ontario. 


While the percentage of private payment is highest in Ontario, households across Canada are spending an ever-increasing percentage of their total household income on private health care, Statistics Canada reports.  While private health care spending is taking up a bigger part of the income of all incomes levels, it is especially hitting middle and low income households:

Private health care costs increasing in Canada

Percentage of households with out-of-pocket expenditures on health care more than 5%
of total household income, by household income quintileNote
Household income quintile
Year
1997
1999
2001
2003
2005
2007
2009
%
Q1 (lowest)
26
29
30
33
34
37
37
Q2
30
33
35
37
38
39
36
Q3
23
25
26
30
30
29
31
Q4
16
19
19
21
22
22
19
Q5 (highest)
10
9
10
13
13
13
14



A new report from Stats Can notes that between 1997 and 2009 private health care payments went up 63% for lower income households, but significantly less for higher income households.  B2009, out-of-pocket health care expenditures represented 5.7% of the total after-tax income of lower income households but only 2.6% for upper income households.  Between 1998 and 2009, the percentage of households spending more than 10% of their total after-tax income on health care rose by 56%.     

Private insurance is expanding very rapidly: The three main components of out-of-pocket health-care expenditure are:
  • Dental services ($380 reported per household in 2009).
  • Prescription medications ($320 per household in 2009)
  • Insurance premiums ($650 per household in 2009).
Of these three main categories, payments to insurance companies increased the most rapidly. Over more than two decades, private health insurance payments per household increased from $139.40 in 1988 to $686.30 in 2011.

That's an eye-popping 7.2% annual growth over more than 20 years, according to CIHI.


And again, private health insurance expenditures affected different income levels differently.  The Stats Can report indicates that payments increased 80% to 90% for households with low to medium income between 1997 and 2009, but only 52% for households in the top fifth of incomes.


This data suggests private health care payments are going mostly to giant insurance and pharmaceutical corporations -- and  that they are hurting working people the most.  That is also part of the price of low public sector health care spending in Ontario.


The CIHI report on health expenditures is available by clicking here.


Photo: Dominion of Canada one Dollar banknote of 1898, Wikimedia Commons

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