January 18, 2024 – Can we really debate private healthcare in Canada if we don’t understand how it works? A new report by the C.D. Howe Institute explains how to understand private healthcare in context, reveals why the contours of private healthcare in Canada vary so much across the country, and examines why they are changing. Private aspects of healthcare already exist in different forms and to varying degrees across Canadian provinces, largely depending on their respective legislation and regulations. For example, while most healthcare professionals bill through the public insurance system, there are many instances of those who bill privately; but the conditions under which they can do so differ across provinces.
In “The Scope and Nature of Private Healthcare in Canada,” author and university professor Katherine Fierlbeck states that all health systems, including Canada’s, already incorporate a robust mix of private and public healthcare, with the provinces overseeing the provision of healthcare in Canada. The author notes that the growing demand for healthcare services has many disparate causes, such as our aging population and changes in the nature of healthcare itself, including more treatments and more clinical options available than ever before. But it is not only demand that is changing: the shifting ways in which private healthcare can now be provided are having an impact on the provision of private healthcare as well.
“It is crucial that we understand the topography of healthcare in this country,” Fierlbeck says. “Increasing demand is putting intense pressures on the healthcare system. This demand, along with new healthcare delivery modes, mean that more people – even those firmly committed to public healthcare - are increasingly able, or even obliged, to look for care outside of the public system.” This is especially noticeable in Canadians’ constrained access to primary healthcare services, as well as access to diagnostic services.
“The goal of this paper is not to argue either for or against private healthcare,” says Fierlbeck. “It is simply to clarify what is meant by ‘private’ healthcare, and to explain the different ways provincial legislation currently permits or prohibits aspects of private healthcare. I also discuss the supply and demand side variables that cause private healthcare to take its current shape across provinces, and finally, I offer an analysis of the relationship between provincial healthcare legislation and the Canada Health Act, with reference to the expansion of private healthcare in Canada.”
When it comes to the delivery of healthcare services in Canada, Fierlbeck outlines the differences between the public and private healthcare models and the differing legislative models by province. For instance, all Canadian provinces and territories offer most medically necessary healthcare services funded on a tax-based model, but each province also has the authority to determine what it insures publicly, which is why services deemed as ‘insured’ or ‘medically necessary’ vary across provincial jurisdiction. When it comes to private health insurance, Fierlbeck lists five different types that each serve a different function: supplementary, complementary, substitutive, duplicative and private not-for-profit insurance, where supplementary health insurance is the most common in Canada and is usually provided by employer insurance plans. Whether medically-necessary services are considered ‘insured’ again varies across provinces, depending on who provides them, or where and how they are provided. This, in turn, can cause tensions between provinces and the federal government over compliance with the Canada Health Act.
Where is private health care going in Canada? “As the paper shows, regardless of whether provinces want to expand or constrain private health care, the specific policy direction available is different for each jurisdiction, as legislation and other barriers to private healthcare varies across provinces,” Fierlbeck says. “To engage in this political debate, however, it is important to understand clearly what private healthcare is and what it is not, and how it manifests within the legislative landscape of each jurisdiction.”
For more information, please contact: Katherine Fierlbeck, Professor and Chair, McCulloch Research Chair, Department of Political Science, Dalhousie University; and Gillian Campbell, Communications Officer, C.D. Howe Institute at gcampbell@cdhowe.org.
The C.D. Howe Institute is an independent not-for-profit research institute whose mission is to raise living standards by fostering economically sound public policies. Widely considered to be Canada's most influential think tank, the Institute is a trusted source of essential policy intelligence, distinguished by research that is nonpartisan, evidence-based and subject to definitive expert review.