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Comparing the U.S Health Care System with Canada Essay Sample


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Introduction of TOPIC

The United States health care system has been the center for much heated debate between politicians, law makers, leaders, and health experts. With the United States being the leader in advance medical technology, and high health care spending, somehow it has many uninsured citizens. In the 1930’s, Americans and Canadians had similar health care concept. Both tried to alleviate health care gaps by increasing use of employment-based insurance plans (Dressel, 2006). Both also encouraged nonprofit private insurance plans like Blue Cross, as well as for profit insurance plans (Dressel 2010). To this day, Americans continue to practice the same concept while Canada now has Medicare which is a government-funded universal health insurance program which was passed in 1957, 1966, and 1984 (“Canadian Museum of”, 2010). While the majority of developed countries are now providing a national health insurance program financed and run by government, the United States is considered as a fragmented health care system because people obtain health care through different means (Shi, Singh 2012). The basic component of a health service delivery system make up the quad-function model: financing, insurance, delivery, and payment. We look at how the United States and Canada’s health care system was developed, as well as contrast each system.

Review of literature
United States has a pluralistic control health care system meaning that the U.S health care system is dependent upon a free market system, and very fragmented, and there is no overall governance. The U.S health care system is considered one of the best in the world, mainly because of our advanced medical technology, and our state of the art facilities. With the United States state of the art facilities and medical technology, the U.S spends the most financially on their healthcare system, but still America have the most uninsured, uneven quality, and administrative waste. For example, U.S citizens spent $5,267 per capita for healthcare in 2002; this is 53% more than any other country (Anderson, Hussey, Frogner & Waters, 2005). The U.S health care system is both financed publically and privately through a market based system. Even in market- based systems, the government may provide health care to vulnerable people. For instance, in the U.S., federal funds support Medicare, which covers the elderly and disabled, and state and federal funds support Medicaid, which covers low-income people (Financing Health Care, Page 1).

However, private elements of the U.S health care system dominate public elements. “An acceptable health care delivery system should have two primary objectives: 1) it must enable all citizens to obtain health care services when needed, and 2) the services must be cost effective and meet certain established standards of quality. The U.S health care delivery system falls short of both these ideals.” (Shi, Singh. 2012. Page 5). About 84% of the population is covered by either public (26%) or private (70%) health insurance. Approximately 61% of health insurance coverage is employment related, largely due to the cost savings associated with group plans that can be purchased through an employer ((Ridic, Gleason & Ridic, 2012). Even with employers offering health coverage to its employees, it is still a voluntary thing. Employers are not mandated to provide health benefits to its employees. According to small businesses, the cost to provide health benefits to their employees is just too expensive. The two major types of public health insurance, both of which began in 1966 are Medicare and Medicaid. Medicare is a uniform national public health insurance program for aged and dis- abled individuals. Administered by the federal government, Medicare is the largest health insurer in the country, covering about 13 % of the population.

The Medicare plan consists of two parts. Part A is compulsory and provides health insurance coverage for inpatient hospital care, very limited nursing home services and some home health services. Part B the voluntary or supplemental plan provides benefits for physician services, outpatient hospital services, outpatient laboratory and radiology services and home health services. Part A of Medicare is funded by a Medicare tax that is similar to the Social Security tax, and Part B is financed by monthly premiums (25%) and general taxes (75%). Medic- aid, provides coverage for certain economically disadvantaged groups (Ridic et al, 2012). Medicaid is jointly financed by the federal and state governments and is administered by each state. The federal government provides state governments with a certain percent- age of matching finds ranging from 50 to 77%, depending on the per capita income in the state. Coverage under Medicaid varies because states have established different requirements for eligibility.

Individuals who are elderly, blind, disabled or members of families with dependent children must be covered by Medicaid for states to receive federal funds. Additionally, although the federal government stimulates a certain basic package of health care benefits (e.g. hospital, physician and nursing home services), some states are more generous than others ( Ridic et al, 2012). The payment function in the U.S health care system deals with reimbursement. With private insurance, before a patient can be fully covered, the person must pay the premium price and reach a deductible. Sometimes, patients would need to pay a small fee called co-payments to see a physician. Once a deductible is met, the insurance company can start paying for services needed. The funds for actual disbursements come from premiums paid to the insurance company (Shi, Singh 2012, page 7). Even with privately owned insurance, and some public assistant, there are still many uninsured citizens.

The cost of private health insurance is too expensive, and because you need to meet eligibility requirements for medicare or Medicaid, some people do not meet the expectations. The uninsured is a growing concern within the U.S health care system. President Obama declared the Health care reform act which mandates everyone to be insured by the year 2014. The reform also prohibits insurance companies from denying clients to get insured because of a condition. Canada is under the national health insurance system. Its health insurance program is often referred to “medicare”, and is designed to ensure that all residence have reasonable access to medically necessary hospital, and physician services. Its healthcare is publically funded and administered on provincial or territorial bases within guidelines set by the federal government. (Health Canada 2011). The federal government, ten provinces, and the three territories of Canada have key rol

es in the Canadian healthcare system, and that is to maintain and improve the health’s of Canadian

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citizens, and share the responsibilities for health care include setting and administering national principles for the health care system through the Canada Health Act, and delivering health care services for specific groups.

The Canada Health Act is a federal legislation that puts in place conditions by which individual provinces and territories in Canada may receive funding for health care services. Their five principles include public administration, comprehensiveness, universality, portability, and accessibility. Canada’s healthcare delivery system is similar to United States. Primary healthcare is the foundation of the health care system. It is the first point of contact people have with the healthcare system. In order for a patient to see a specialist, that person would need to get the referral. Community boards trustees, voluntary organizations or municipalities, operate the majority of Canadian hospitals. Long term institutions are paid for the provincial and territorial governments, while room and board are paid for by the individual. (Health Canada). Even with universal health insurance coverage, there are problems. For example, the waitlist in Canada is very long. The average wait for nonemergency surgery in Canada was more than four months. ((Anderson , Hussey, Frogner & Waters , 2005). The Canadian Medical Association gave Canada’s healthcare delivery poor grades in timeliness. 55% of Canadians felt that the waiting to see their specialist were unreasonable, while 46% complained about their wait for advanced diagnostic procedure (Kosub).

There are questions of whether everyone who waits for a service is actually on a list. The Winnipeg Free Press reports that the waitlist for a cataract surgery in Winnipeg has 2000 patients on it (Barer, Lewis 2000). Typically, the doctor decides when to put you on the waitlist, and it all depends on the urgent the doctor thinks your situation is. Health Care in Canada, as stated earlier is funded at both the provincial level and federal level. According to Shi, and Singh (2012), the bulk of financing for Medicare comes from general provincial tax revenues. The federal government provides a fixed amount that is independent of actual expenditures. 70% of the tax is used to pay for healthcare expenditures, and the remaining 30% pays for supplementary services. Employers in Canada offer private insurance for supplemental coverage (page 22). Alberta, British Columbia and Ontario charge health premiums to supplement health funding, however, premiums are not required for health coverage according to the Canada Health Act (Canadian Health 2007).

Health insurance in Canada is handled by individual provinces and territories. New residence to a province must apply for health coverage. When the new resident is granted health coverage, they are given a health card which provides coverage for that province. When you are a new resident, there is typically a waiting period before your health coverage will be granted. In the Canada Health Act, the waiting period cannot exceed three months. Even though certain provinces like BC, Alberta, and Ontario require health premiums for services, they cannot deny health services if a person is unable to pay the premium (Health Canada 2011). Provinces typically provide additional services not listed under the Canada Health Act, but are not obligated to. The public healthcare covers basic services like primary care physicians and hospitals, but there are services that are not covered, like dental services, optometrist, and prescription medications. This private health insurance are usually offered as part of employee benefit packages in many companies, or Canadians can purchase insurance packages from private insurance providers. Even with private insurance available to help with supplemental cost for dental and vision, many Canadians rely exclusively on the public health system.

Even with a public healthcare system, the increased spending in healthcare is creating problems on how to sustain their current health care delivery and financing. Spending on healthcare alone has increased from 7% of program spending at the provincial level in the 1970s to almost 40% today. Within the next few years it is expected to surpass 50%. (Shi, Singh 2012). According to Janssen (2011), spending on healthcare was forecasted to reach $200.5 billion in 2011. The main factor that drove health care expenditure is compensation of health professionals. Hospitals represent the largest category of public sector spending, about 37%, and compensation represents about 60% of total hospital budget. The number of hospital workers grew by 21% between the year 1999 and 2008, and their compensation increased faster than that of workers in the general labor market. Physicians represent the second largest category of public-sector. Their expenditures increased on average 6.8% a year. The Canadian Institute of Health Information data shows that the price of doctor services was the most important cost driver of spending (CIHI, 2011).

In discussing U.S and Canada’s health care system, we’ve come to understand that the countries health care systems are very different. Canada has a single-payer, mostly publicly-funded system, while the U.S is a multiplayer system consisting of a very heavy private market based system, and public based system with medicare and Medicaid. Because of the way the systems are run in each country affects the health outcomes of its citizens. Canada’s health care reform allowed all of its citizens to have access to health care. When a new resident moves to a new Canadian Territory or province, they must apply for health care.

Once a resident receives their new health card, they have access to health care service within their territory. Unlike with the U.S. only a handful of its residents are insured. Mostly the wealthy can afford private insurance, and the rest are left without. In Canada most employers offer supplemental insurance to cover vision, dental. In the United States, employers are not obligated to provide health benefits to its employees. According to the National Bureau of Economic Research (2013) because the U.S have more available health care resources, the use of cancer screenings such as mammograms, PAP smears, PSA screening, and colonoscopies, are used more frequently in the U.S. 86% of U.S women ages 40-69 have had cancer screening, compared to 73% of Canadian women (eg. National Bureau of Economic Research 2013). Because Canada is under the national Health Insurance program, wait time for treatment is very long compared to the U.S.

The Canadian Wait time table shows the median actual wait vs. median clinically reasonable wait by Specialty from Primary Care Physician to Treatment. The wait time for treatment is one of the growing concern in Canada’s healthcare (Roff 2009).

With the research done to evaluate both the U.S health care system and Canada’s health care system, we cannot fully say that one is better than the other. Both countries offer different ideals that can be beneficial to a health care system. Canada has a universal health care system which provides health care services to all its eligible residents, and funded by the government through general taxes, and the United States has a market based system funded either privately or publically for medicare and Medicaid. We’ve also learned that United States have a high percentage of health care expenditure, but despite that, there are still many who are uninsured. However, there are reforms to the health care now that will give the ability for U.S residents to be insured. Canadians are satisfied with their health care system, but there can be improvements made like wait time for specialized services. The health care system is an integral part of each country. When it follows the basic ideals, enables all citizens to obtain health care, and services are cost effective, it will deliver equitable services.

After learning more about our health care system and Canada’s health care system, I am beginning to realize that we should have a universal health insurance. There are so many debates about whether everybody is allowed access to health insurance. To me, the U.S health care system ranks high in medical technology, but it fails to allow access to services. If the U.S incorporates Canada’s elements of a national health care system, our country would be much healthier. People won’t be so scared to seek treatment, and the burden will lighten when it comes to payment. We are the only country still not practicing the universal health care plan. Insurance companies are big business in the U.S, and their main goal is to make a profit. People also believe that if we do allow a universal health care, that our taxes will be higher especially with the lower income community. I wouldn’t mind a slight increase in taxes if it meant that I would be allowed health care services.


Anderson , G., Hussey, P., Frogner, B., & Waters , H. (2005). Health spending in the united states and the rest of the industrialized world . Retrieved from http://content.healthaffairs.org/content/24/4/903.full Barer, M., & Lewis, S. (2000). Waiting for health care in Canada: problems and prospects. Canadian Health, C. (2007, January 01). Canadian health care. Retrieved from http://www.canadian-healthcare.org/page2.html Canadian museum of civilization. (2010, 04 21). Retrieved from http://www.civilization.ca/cm CIHI. (2011). Retrieved from CIHI website: http://www.cihi.ca/cihi-ext-portal/internet/en/document/spending and health workforce/spending/release_03nov11 Dressel, H. (2006, 08 04). Yes!. Retrieved from http://www.yesmagazine.org/issues/health-care-for-all/has-Canada-got-the-cure Financing health care. DOI: www.jnj.com/../financing-health-care.pdf?MOD=AJPERES Health Canada. (2011, November 17). Government of Canada. Retrieved from http://www.hc-sc.gc.ca/ahc-asc/index-eng.php Janssen. (2011, Nov 03). Health care spending to top $200b in Canada. Retrieved from http://www.cbc.ca/news/health/story/2011/11/03/health-care-spending.html O’Neill, J. (2012, March 08). The national bureau of economic research. Retrieved from http://www.nber.org/bah/fall07/w13429.html Ridic, G., Gleason , S., & Ridic, O. (2012). Comparison of health care system in the united states, Germany, and Canada. Retrieved from http://www.scopemed.org/fulltextpdf.php?mno=20023 Roff, P. (2009, July 28). www.usnews.com. Retrieved from http://www.usnews.com/opinion/blogs/peter-roff/2009/07/28/statistics-show-canada-healthcare-is-inferior-to-american-system Shi, L., & Singh, D. (2012). Delivering health care in America. (5 ed., pp. 5-20). Burlington:

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