This is the Fraser Institute's fifth annual report on the financial sustainability of health spending by provincial governments in Canada. The report uses a moving 10-year trend analysis to measure sustainability. The report also examines the long-term practicability of attempts by provincial governments to deal with the unsustainable growth in health spending through increased tax burdens and centrally planned rationing. The analysis partially exposes the degree to which Canadians are paying more for government health insurance and getting less in return.

The data and analysis in this report indicate that public health insurance, as it is currently structured in Canada, produces rates of growth in government health care spending that are not financially sustainable through public means alone. This financial crisis is occurring while governments are restricting and reducing the range of benefits covered under publicly funded health insurance. As an alternative to the current approach to health policy, we recommend that governments take a number of actions to ensure that Canadians will not continue paying more and getting less.

When comparing Canada's single-payer health insurance system with the pluralistic system in the United States, many people mistakenly assume that Canadians enjoy universal coverage while receiving the same quality and quantity of medical goods and services as Americans, but at lower costs. The reality is that, on average, Americans spend more of their incomes on health care, but get faster access to more and better medical resources in return for the money spent.

In truth, the Canadian health insurance system is not cheap at all: it is actually among the most expensive in the world. Recent statistics show that only three other comparable countries (United States, Iceland, and Switzerland) spend more of their national income on health care than Canada. More importantly, Canadians do not get good value for money from their health system. There are many hidden costs in Canadian health care that are ignored by advocates of single-payer systems.