Canada does not have a health care system

(Published as “If doctors operate as a business, what’s wrong with surgery through private clinics?”)

Dr. Trevor Hancock

1 February 2023

700 words

There is much wringing of hands these days about the state of the Canadian health care system, as well there should be. But in fact there is no such thing as a Canadian health care system, although there is a Canadian way of funding health services. In the 1990s, when I helped organise study tours for Swedish health system managers to visit Canada, I used to describe the ‘Canadian health care system’ to them as ten publicly-funded private non-systems.

Let me pick that apart. First, there is no Canadian health system, because when Canada was formed in 1867, the federal government got what was then important in politics – foreign affairs, defence, international trade etc., while the provinces got the less important stuff; health, education, social support etc. So constitutionally, health is a provincial, not a federal responsibility.

That is why we have 10 health ministries and ministers, 10 sets of licensing and regulatory Colleges for physicians, nurses and so on; 13 if you include the territories. Each province licences its professionals – which is why it is hard to transfer from province to province, even though – in my experience – the human body and its diseases, and the treatment of those diseases, is the same across the country. Hardly a system, certainly not an efficient one.

As a result we have ten different provincial systems, each of which has its own policies and programs, negotiates its own fee schedule and salaries with staff, its own approved drug lists and so on. The only thing that really unites them are the five principles enshrined in the Canada Health Act; if the province is to receive federal funding the provincial system must be comprehensive, universal, accessible, portable and publicly administered.

Importantly, the principles only apply to physician and hospital services (and selected dental surgical services), which is why almost all dental care, as well as home care, pharmacy, physio, psychological counselling and similar services  are either not covered or only partly covered. This lack of coverage is why one quarter of all health expenditure in Canada is funded though the private sector – mainly out of your own pocket or through private insurance as part of a benefits package, unless your income is low enough that you qualify for public assistance.

An important area of confusion is that health services only have to be publicly administered, not provided by public authorities. So insured services can and are provided by the private sector. In fact a large part of the publicly funded system is privately owned and operated, starting with your doctor.

A 2016 brief from the Canadian Medical Association reported “the vast majority of physicians are self-employed professionals operating medical practices as small business owners”. Similarly, if you have had lab or X-ray work, chances are it was a privately operated lab or X-ray. But because they are providing an insured service and billing the single public payer, this is fine.  

Which is why the recent furore over providing surgery through private clinics is a bit puzzling. Now don’t get me wrong, I am opposed to a two-tier system in which the wealthy can jump the queue and get better services. Apart from anything else, that may draw staff and resources away from the public sector, leading to its deterioration.

But if you can go to a family doctor and then a surgeon who are private business people, and get your lab and X-ray work-up done by private businesses, then what is wrong with having your surgery done in a privately owned and operated clinic, as long as it is a procedure that the public system insures (if it isn’t, you would have to pay privately anyway), is as safe as and has outcomes at least as good as in the public system, is no more expensive than the public system, and bills only the public system, not the patient.

Finally, a system? Really? Well, if so, it is a badly-designed system, because, as the Institute for Healthcare Improvement likes to say, “every system is perfectly designed to achieve the results it gets”, and this ‘system’ is not delivering what we need. Time for a radical re-think, a topic I will return to soon.

© Trevor Hancock, 2023

Dr. Trevor Hancock is a retired professor and senior scholar at the

University of Victoria’s School of Public Health and Social Policy


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