Lessons from Canada: Stay Away from Nationalized Medicine

Kathryn Nix / June 07, 2010

The United States isn’t the only country in North America grappling with the fiscal problems caused by an aging population and mounting federal deficits—Canada faces a similar fate.  The difference is that, while the United States just passed a $1 trillion-plus government overhaul of health care, incorrectly justified by claims that it will reduce health care spending, Canada’s provinces are trying to figure out how to pay for their nationalized health care system, a major source of out-of-control growth in government spending.

Reuters reports that each province is scavenging for its own fix.  In Ontario, the solution will be severe price controls for generic drugs.  British Columbia is looking at a fee-for-service payment system.  And Quebec implemented a new flat health tax.

This will just be the beginning of tightened belt straps for Canadians’.  According to Derek Burleton, a senior economist at Toronto-Dominion Bank, “We can’t continually see health spending growing above and beyond the growth rate in the economy because, at some point, it means crowding out of all the other government services…At some stage we’re going to hit a breaking point.” (more…)