The Canadian Universal Healthcare System

Canada’s national healthcare system, known as Medicare, is a source of immense collective achievement. The Canadian healthcare system is run by the government, provides all citizens of Canada with universal health care coverage, and hence access to all available health care services. By definition, no one is medically uninsured in Canada (Westhues, 2006). As opposed to all other industrialized nations, Canadians are not permitted to purchase private health care insurance. This paper examines some aspects concerning Canadian health care system with special emphasis on its funding, and quality (Stahl, 2004).

The Canadian universal health care system is dated back in 1957 when the House of Commons created legislation that provided funding to any province that administered and helped to finance universal hospital insurance. In 1968, medical insurance was added to this. By 1971, all ten Canadian provinces were participating in the federally funded program in which the federal government paid half of the province’s costs of health care. By 1984, through the Canada Health Act, physicians were forbidden to charge a fee that exceeded the provincial benefit schedule. The Canada Health Act, however, does not provide for universal drug coverage or nursing home care. Drug coverage is provided to the elderly and poor (Westhues, 2006).

Canada’s universal care program is a federally mandated; province- and territory-administered program that covers Canadians for medically necessary hospital and physician care. Under the program, the federal government establishes guidelines for the health care insurance plans of the ten provinces and two territories (Stahl, 2004). While the plans vary to some extent, all must cover medically necessary physician and diagnostic services and inpatient hospital care, and can cover a broad range of supplemental benefits such as dental care, prosthetics, and long-term care. Private insurance companies cannot offer coverage for medically necessary physician, diagnostic, and hospital services. However, they can offer insurance for supplemental benefits such as prescription drugs, dental care, and vision care whether they are included in provincial or territorial plans (Westhues, 2006).

The provinces and territories rely on the private and public health care delivery systems to provide health care services. Most physicians are in private practice, about 95 percent of Canadian hospitals nonprofit entities operated by local governments, voluntary organizations, or other agencies. The universal health care program relies extensively on primary care physicians to provide basic medical care and to refer patients to specialists and hospitals. Canadian citizens can go to the physician or clinic of their choice but do not pay directly for primary or specialist physician care or hospital services (Westhues, 2006).

Physicians are paid by the provincial or territory insurance plans on a fee basis; fees are negotiated annually between the provinces and territories and the provincial medical associations. Hospitals’ operating costs are paid out of annual budgets negotiated with the province or territory. The federal government provides block grant monies to the provinces and territories, which in turn, provide additional tax revenues as necessary (Jonsson, 2008).

Canada’s universal health care system combines local and provincial control together with federal enforcement and funding. In its status, there is nothing like ‘Canadian’ health system, instead there are ten distinct provincial health care plans. Each of them is designated to cater for the needs and resources of its population. According to the stipulations of Medicare, every provincial government is required to full five prerequisites. These include portability, public governance, universality, fullness and ease of access (Jonsson, 2008). The fees for medical services are arrived at after negotiations are held between doctors who have representatives from their provincial medical associations, as well as provincial governments. The fundamental distinction that makes Canadian health system is because there is only one insurer, which is the government. Generally, doctors operate on the grounds of fee-for-service basis. This is the same case with United States. Nevertheless, in the case of the former, the bill is sent to the provincial government instead of insurance companies like in the case of the U.S (Stahl, 2004).

Although Canada has succeeded in providing universal health care to all its citizens, the quality of health care provided by the system has come under criticism in the recent past. The quality of health care services has been compromised to a government budget deficit that has forced the federal government to cut its contribution to provincial health care (Stahl, 2004). Originally, the federal government contributed 50 percent of provincial health care. However, subsequent budget deficits have seen this amount slumped down to a dwindling 20 percent. The decrease by federal funding has led to a number of factors such as longer waiting hours, lack of hospital accommodation. These factors have compromised the quality of the health care provided. Despite these problems facing the Canadian universal health care system, there are plans under way to offer solutions to the current situation. One of the remedies that have been proposed is to augment the provision of health care by private entities, as well as a further devolution of health care authority to the level of management by local boards (Jonsson, 2008).


Jonsson, E. (2008). Financing health care: new ideas for a changing society. New York: John Wiley & Sons.

Stahl, M. (2004). Encyclopedia of health care management. London: SAGE.

Westhues, A. (2006). Canadian social policy: issues and perspectives. Toronto: Wilfred University Press.

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