A Comparison of Health Care in Canada and the United States
Health care reform in the United States is a notion long in the making. Growing concern over medical costs and availability of care has led to large-scale debate over the future of the American health care system. Eyes have turned north to Canada to compare their universal system of health care with that of the U.S. The question is, can the Canadian model improve care available to all citizens, while keeping the costs down?
The Canadian and American health care systems are worlds apart, from their acquisition of funds and government involvement, to the costs, delivery, and even outcomes of the systems. The Canadian system is funded through a single-payer system (the government), through tax revenue. The government pays for almost all of the medical costs. The benefits of this system include accessibility to services for all residents and lower administrative costs. The drawbacks of the single-payer system include long wait times and staff shortages due to lack of funding. The American health care system uses funding primarily from private sources, and most residents have access to a variety of insurance plans. The administrative costs associated with the numerous insurance companies are extremely high.
In a survey on health care satisfaction, Americans were found to be one third less likely than Canadians to have a regular medical doctor, one fourth more likely to have unmet health care needs, and are more than twice as likely to go without required medication. These numbers increase substantially for the uninsured. According to the study, more U.S. respondents had unmet health care needs than did Canadians (13.2% and 10.7%, respectively), however, their reasons for having such needs differed. 7% of U.S. residents (and less than 1% of Canadians) had unmet needs because of finances, whereas 3.5% of Canadians had unmet needs because of long waiting times. U.S. respondents cited wait times as less than 1% for reasons behind unmet needs. The barrier to meeting health care needs in the U.S. is the cost; in Canada, wait times are the main offender. The data suggests that Canada no longer enjoys greater satisfaction with its health care than does the United States. It seems plausible that Canada’s far lower health spending compromises aspects of care that affect satisfaction but not health outcomes.
The same health study observed at least 17% and perhaps as many as 21% of Canadian women are not receiving recommended cervical cancer screening. This deficiency may reflect low reimbursement rates for this service in Canada. However, death rates from cervical cancer have historically been lower in Canada than in the United States, possibly due to past screening practices and population risk factors. According to the Organization for Economic Co-operation and Development (OECD), the U.S. has an exceptional track record of early cancer detection and treatment.
Canada’s single-payer system for physician and hospital care is far more efficient in comparison with the American multi-payer model when looking at administration. Hospitals that are not-for-profit have considerably lower payments to third-party payers in comparison to for-profit hospitals, while also achieving lower mortality rates. Canada’s single-payer system, which relies on not-for-profit delivery, achieves health outcomes that are at least equal to those in the United States at two-thirds the cost. Some research into the issue of single-payer systems has shown the administrative costs of billing individual private insurance companies can be reduced by 20%. That would be a savings of roughly 200 billion per year in the U.S.
Despite the arguments that universal health care bears a hefty price tag, the U.S. spends significantly more per year on their health care. According to the OECD, Health care spending as a percentage of the Gross Domestic Product in 2007, Canada spent approximately 10%, while Americans spend 16%. Americans spend significantly more on their health care per year than any other country in the OECD. A recent report from the organization also reveals that 35% of total health care expenditures is done by private health insurance which is the highest in OECD countries. Regardless of the high medical expenditures, the U.S. has fewer doctors per capita than most other countries in the organization.
The accessibility to medical services without charge is beneficial to those residents with lower incomes. Although there is little difference in the numbers of Canadians and insured Americans with regular medical doctors, in the U.S., approximately 16% of the population is without insurance, and 20 million in the U.S. are underinsured. One-third of the uninsured are in the lowest income quintile. The likelihood of uninsured residents seeking regular medical attention for preventive care or otherwise, is fairly low. Public insurance is available to seniors, the military, veterans, the poor, and the disabled, but this is not universal. As well, insurance premiums and deductibles continue to rise. Health care costs are increasing, placing added financial burdens on the U.S. residents. As the “baby boomers” continue to age, health care costs are expected to increase substantially in the next few years.
Despite the massive spending on health care, life expectancy in the U.S. is lower when compared with Japan, Switzerland, Canada and Australia, and infant mortality rates are higher than in most OECD countries. In 2006, it was 6.7 per live births relative to OECD average of 4.7. Obesity rates among adults is the highest in the U.S. at 34.3% in 2006. Higher obesity rates leads to higher health care spending in the future.
The U.S. continues to be at the forefront of health care research and technology, perhaps due to the for-profit nature of many of the health institutions. There are some critical problems with the American health care system that could be remedied in a number of ways. Looking at the universal system in Canada has shown there is a way to have accessibility, while also keeping the costs down. American policy makers will continue to investigate the system differences in the two countries, hopefully resulting in ways to successfully navigate the health care issues in the U.S.
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