health insurance

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Facing a $16-billion deficit, the Ontario government announced it will stop funding a handful of medical services currently covered by the public health insurer. This should come as no surprise, as it has become the norm in Ontario as well as other Canadian provinces. This is because cost-containment strategies such as rationing access to medical services are intrinsic characteristics of single-payer health insurance.

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As the premiers meet this week in Victoria, a number of provinces are clearly distressed about the federal government’s plan to reduce the automatic annual increase in health transfers from the current six per cent to the rate of economic growth starting in 2017-18. While the announcement has not been applauded by most premiers and their respective health ministers, it is long overdue.

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The true cost of Medicare for individuals and families in Canada is often misunderstood, with many people thinking it’s either free or covered by our provincial health insurance premiums.

This misconception has many sources. In part, it stems from the fact that health care consumption is free at the point of use, leading many to grossly underestimate the actual cost of care delivered. Furthermore, health care is financed through general government revenues, rather than financed through a dedicated tax, further blurring the true dollar cost of the service.


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Whenever talk of health care reform arises—and praise for European countries that combine universal coverage with more private sector involvement—a reflex inevitably kicks in. For some, it seems more privately-delivered or privately-insured health care is a policy choice akin to religious heresy. It’s almost as if government delivery and government insurance were an 11th Commandment: Thou Shalt Only Provide Health Care via Taxes and the Public Sector.

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Are Canadians getting good value for money from their health insurance system? This question is often discussed among health economists and policymakers. And while it’s important to know whether citizens are getting the best ‘bang for their health buck,’ it’s imperative that the appropriate outcomes are measured in order to accurately assess the economic performance of a health insurance system.


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The saddest thing about the health care reform debate in both Canada and the United States is that those who advocate for government-run health insurance have no regard for the facts, and no apparent concern for the interests of patients. Bob Rae’s misinformed commentary about the case of Shona Holmes is an example of this.