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New report cites lowest health care spend in 17 years

healthcost.jpgOct. 31, 2014 – The cost of health care in Canada will go up this year, but the increase is expected to be the smallest in the past 17 years, a new report suggests.

The report on health-care spending in Canada estimates that total health expenditures will rise by only 2.1 per cent, or $61 more per person compared to last year's health costs.


October 31, 2014
By Helen Branswell The Canadian Press

Spending on drugs has flattened out. And concerns about the cost of a
greying population on the health system aren’t currently driving costs
up in a significant way, according to the report from the Canadian
Institute for Health Information.

At this point, the institute
says, population aging is only increasing costs by just under one per
cent per year – 0.9 per cent. The trend is expected to change
incrementally over the next two decades, the CIHI report says.

“While
concerns regarding demographics are understandable – Canadians over the
age of 65 account for less than 15 per cent of the population but
consume more than 45 per cent of provinces’ and territories’ health-care
dollars – the share of public-sector health dollars spent on Canadian
seniors has not changed significantly over the past decade,” Brent
Diverty, CIHI’s vice-president for programs, said in a press release.

The
report notes that in 2012, per person spending for seniors ranged
broadly, from $6,368 per person for those aged 65 to 69 to $21,054 per
person per year for those aged 80 or older.

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The low end of that scale isn’t far off what the report says Canada will pay per person in general in 2014 – $6,045.

Canada
is expected to spend just under $215 billion this year on health care,
which equates to 11 per cent of the country’s gross domestic product.

That
spending level puts Canada tied for seventh with Denmark among the
countries of the Organization for Economic Co-operation and Development,
the OECD. Canadian spending trails that of the United States, the
Netherlands, France, Switzerland, Germany and Austria.

The public
purse picks up about 70 per cent of the cost of health care in Canada.
The remaining 30 per cent comes from out-of-pocket payments by
individuals and private health insurance. That 70-30 cost breakdown has
been relatively constant over the past 20 years, the report says.

Hospitals
make up about 30 per cent of health-care spending, $63.5 billion. Drugs
and doctors come next, at 16 and 15 per cent respectively, or $33.9
billion and $33.3 billion.

Drug costs, once a major driver of
expenditure increases, have stabilized, growing by only 0.8 per cent in
2014, the report says.

“Drug expenditures are slowing down,”
Diverty says. “With generic pricing control policies for the
pharmaceutical industry, the expiration of patents on prevalent
medications and fewer new drugs entering the market, we are seeing what
amounts to flattened growth.”

The three territories, which often
have to fly residents south for medical care, spend substantially more
per person than provinces do. Nunavut will spend the most, at just over
$13,160 a person, while Quebec is expected to spend the least, at
$5,616.


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