Most Canadian families don’t realize a large chunk of their salaries is going towards paying for public healthcare due to the hidden costs and complicated bureaucracy that handles transfer payments.
According to a new study by the Fraser Institute, the average Canadian family of all types will pay 240% more for public health care insurance this year than in 1997, outpacing the 141.1% cash income increase the average family received in the same period. Healthcare costs are rising 1.7 times faster than the average income.
By examining the amount of money each family pays to all levels of government for healthcare, the study’s authors identified that for six common family types, Canadians would pay an estimated $4,908 to $17,713 in healthcare costs, depending on the type of family.
According to a survey by the US health policy research organization KFF, the average annual cost of health insurance for the average American family was USD $23,968. For those with employment benefits, $6,575 of the cost was paid by the workers themselves. The average American family paid around CAD $9000 for health insurance in 2024.
According to the report a family of four in Canada with an average household income of $175,266 will pay an estimated $17,713 for public healthcare insurance this year. On the low end, the average single parent with two children will pay $4,908 for healthcare in 2024.
This year, 23.3% of tax revenues will be spent on Canadian healthcare.
According to the study, $225.1 billion was spent on healthcare in 2023, which would mean $5,614 per Canadian in that year. However, due to the progressive tax system, that number doesn’t account for the difference between Canadians with different incomes and living situations.
Canadian families with the lowest 10% income brackets will pay an average of about $639 for public health care insurance in 2024. The 10% of Canadian families who earn a mid-range household income of $81,825 will pay an average of $7,758 for public health care insurance, and the families among the top 10% of income earners in Canada will pay $47,071.
Healthcare costs have increased 2.2 times as fast as the cost of food and 1.6 times as fast as the cost of shelter.
Spending on shelter increased by 150.5%, spending on food increased by 111.1 percent, and spending on clothing rose by 18.5%, a decline in clothing expenditures compared to previous years. In contrast, health care insurance for the average Canadian family increased by 239.6%.
“There are some very important questions Canadians should be asking about what sort of healthcare system we’re paying for,” Nadeem Esmail, a study co-author, told True North in an interview. “When we look at the cost-benefit equation in Canada, Canadians are getting a raw deal.”
He noted that Canadians faced an average of 27.7 weeks of healthcare waiting time in 2023, the longest ever recorded. In one case, True North reported, a patient was told there was a three-year waiting list for a specialist.
Canada ranked low among 30 high-income countries with universal access to healthcare systems in 2023 despite spending the most out of those countries. It ranked 28th in access to doctors, 23rd in hospital beds, and 25th in MRI machines and has the longest wait lists for any of those nations with the available data.
“We’re paying an awful lot of money for healthcare, one of the highest price tags internationally on an age-adjusted basis, and we have some of the worst access to healthcare in the developed world in exchange for that,” Esmail said.
He said that the cost of healthcare rose considerably in 2020, as expected from the global COVID-19 pandemic, but then fell in 2022 for “a number of family types” on an inflation-adjusted basis. He noted that in 2024, Canada will have the highest healthcare costs than in prepandemic years.
“The general trend of a healthcare system delivering remarkably poor access for a high price tag has continued and has been consistent with wait times now, having grown well past what they were in the pre-pandemic period and continuing to grow,” he said.
He believes that Canada ought to follow the lead of countries such as Switzerland, Japan, Germany, Australia and the Netherlands, which rank better in terms of rapid access to universal healthcare, shorter wait times, lower levels of spending and “some of the best outcomes for the healthcare process in the developed world.”
“These nations have all embraced private competition in the delivery of universally accessible services, allowing a private alternative to the universal system for those times when the public system is unwilling or unable to meet a patient’s needs and requires patients to share the cost of the care they consume through user fees or co-payments,” he said. “For some of the worst access to healthcare in the developed world, there are better ways to do healthcare out there.”
