GOLDSTEIN: The Real Cost of ‘Free’ Health Care in Canada – Report

Article content

Contrary to the myth that Canadian healthcare is “free,” families pay between $ 726 and $ 41,916 a year through their taxes, according to a new study from the Fraser Institute.

Article content

“Canadians pay a substantial amount of money for health care through a variety of taxes, even if we do not pay directly for health care,” said Bacchus Barua, co-author of The price of public health insurance, 2021.

“Most Canadians are unaware of the true cost of health care because they never see a bill for health services … This situation leads many people to grossly underestimate the true cost of health care (publicly funded). When people talk about ‘free’ healthcare in Canada, they are completely ignoring the substantial cost of the taxpayer-funded system. “

The study by the fiscally conservative think tank says that since 1997, the cost of health care for the average Canadian family has risen 177.6%, outpacing increases in average income of 109.9%.

Article content

Families in the top 10% of people with incomes in Canada who earn a median annual income of $ 286,808 pay an estimated $ 41,916 for health care annually through taxes, the study says, while the 10% The lowest earning an average of $ 18,686 a year pays $ 726 a year.

Families that earn an average of $ 38,110 a year pay $ 1,799 a year; those who earn $ 49,586 a year pay $ 3,283 a year; those who earn $ 61,073 pay $ 4,857; those who earn $ 75,300 pay $ 6,521; those who earn $ 91,097 pay $ 8,516; those who earn $ 109,374 pay $ 10,854; those who earn $ 131,552 pay $ 14,022; and those who earn $ 166,740 pay $ 19,166.

The study also estimates the amount that six typical households pay annually for health care through their income-based taxes.

Article content

It says that a single, single adult earning $ 49,215 a year will pay $ 4,296 a year through their taxes for publicly funded health care, while two childless adults earning $ 123,996 a year will pay $ 13,533.

A single parent with an annual income of $ 66,989 and one child will pay $ 3,909, while a single parent with two children and an income of $ 76,890 will pay $ 3,842.

A two-parent family with one child earning $ 141,749 a year will pay $ 13,746, while a family with two parents and two children earning $ 150,177 will pay $ 15,039 through their health care taxes.

Altogether, Canadians paid $ 174 billion through their taxes to fund health care in 2019, a figure that the study found is expected to rise to around $ 191 billion this year.

Article content

But this latest number should be viewed with caution, the study says, because it doesn’t take into account the full impact of the COVID-19 pandemic on healthcare spending for 2020 and 2021.

(Also, many Canadians privately pay for health insurance in addition to the money they contribute to the health system through their taxes, purchasing health insurance on their own or at their workplaces, to help cover the costs of care. services and drugs not covered by Medicare).

Between 1997 and 2021, the study notes, the cost of public health insurance for Canadians paid with their taxes increased 3.4 times faster than the cost of clothing, 2.2 times faster than the cost of food, 1.7 times faster than the cost. housing and 1.6 times faster than average income growth.

That said, over the past decade, the cost of tax-paid health insurance has slowed considerably, now averaging a 1.6% annual increase compared to 6.4% annual increases from 1997 to 2011.