By Bacchus Barua
and Milagros Palacios
The Fraser Institute
An interesting quirk of Canada’s public healthcare system is that no one really knows how much they pay for it.
The constant reminders about healthcare consuming 40 percent of provincial budgets (on average) certainly disabuse any notion that healthcare is “free.” However, odds are that if you asked someone how much they paid for public healthcare insurance or services last year, a specific answer would be hard to come by.
Bacchus Barua
Why? Because although we’re aware our taxes collectively pay for Canada’s public healthcare system, there’s no dedicated health insurance tax. Governments simply fund healthcare services from a pool of general tax revenues, making it very difficult for Canadians to calculate how much of their total tax payments go towards healthcare every year.
While some provinces such as British Columbia and Ontario have specific health insurance premiums, this only adds to the confusion because such payments still go to general government revenues and even then, only fund a fraction of healthcare costs.
So, how much do we actually pay for our public healthcare system?
Using the most recent tax and healthcare expenditure data, we estimate that the average unattached individual will pay about $4,257 this year, while an average family of four will pay $11,494.
Of course, the payments vary according to income. The 10 percent of Canadian families with the lowest incomes (who earn an average income of $14,028) will pay an average of $443 for public health insurance while families among the top 10 percent of income earners (who earn an average income of $281,359) will pay $37,361.
Milagros
Palacios
While opinions regarding the size of the burden these payments place on taxpayers may vary, such estimates provide important context when discussing the performance and sustainability of Canada’s healthcare system. For example, the average individual who paid more than $4,000 for public healthcare insurance this year may it find difficult to excuse the [popup url=”https://www.fraserinstitute.org/studies/waiting-your-turn-wait-times-for-healthcare-in-canada-2015-report” height=”1000″ width=”1000″ scrollbars=”1″]18.3 week wait[/popup] for medical treatment (after referral from a family doctor).
In order to assess whether we receive good value for our money, it’s important to first get a clearer understanding of how much we actually pay for public healthcare insurance. Canada’s healthcare system is neither “free” nor unique in its goal of “universality” – and it’s important for us to pursue policies that enable delivery of the best healthcare services we can afford without breaking the bank.
Bacchus Barua and Milagros Palacios are analysts at the Fraser Institute and co-authors of The Price of Public Health Care Insurance, 2016 edition.
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