Healthcare funding policy in Canada

Canada’ healthcare system is one of the fewest systems in the world that is funded by the public. It is highly rated and countries from all over the world want to adopt it. 70% of the healthcare system management is done by the public sector and the remaining 30% is done by the private healthcare systems. About 11% of the total GDP of Canada is spent on the healthcare system. An average Canadian is of view that with such a huge spending it is highly recommended to further regularize the system. The hospitals get 29.5% of the total health care amount, the drugs and prescription medicines get about 16% and the physicians get about 15.3% of the total healthcare budget. The spending on the healthcare is increased every year. The federal government is of the view that all Canadians should get fair and cost-effective treatment. Healthcare budget varies all across Canada and it is important to note that the provinces spent about 38% of their total budget on health care. Average per capita spending on health care in Canada is about $6,300. The highest health care spending in 2017 was in the Canadian province of Newfoundland and Labrador which was $7,266.

Healthcare funding basics

The global budget is the most important factor according to which the healthcare budget is distributed. A fixed amount of funding is distributed to the Canadian hospitals and healthcare-related institutes and they provide services to the patients over the course of time which is fixed by the government. This is usually one year and once the period is over the new funding is provided to the hospital. The predictability is the main advantage of the global budgets. They allow the hospital administrations and the governing bodies to decide what they require in the coming year. The issue of oversupply and the unnecessary care is also solved by this kind of funding. The cost of the institutions is also controlled in a highly decisive manner which leads to future cost-cutting initiatives.

Issues in healthcare

There are some issues with the healthcare funding model. As per some experts, this funding model is not correct at all. There are many hospitals which want to remain on budget and therefore they cut some services or become very selective. It is very important to note that the hospitals also cut financial incentives to the patients which tend to stay long. It is a process which is known as cream skimming and this problem has always been criticized by the Canadian healthcare experts. The hospitals in this regard make sure that the low-cost patients are treated. It also leads to hospital penalization.

Activity-based funding

It is important to note that the activity-based funding makes sure that the services based on patients are provided. To change the hospitals it is important that reports are extracted which can change the way hospitals take care of the patients. The system is not integrated with the other important systems which are another problem. The goal of the healthcare system cannot be achieved if this problem is not resolved.