Permitting private health insurance may not obviously weaken public health system

A single payer, fully government funded health care system has often been equated with core Canadian values. It is often argued that a single insurer, the government, is critical to the integrity of the system. Permitting private health insurance, it is claimed, would weaken the public system.

A groundbreaking paper released today by Herb Emery, Svare Professor in Health Economics, for The School of Public Policy at the University of Calgary takes issue with these arguments and concludes that it is not obvious that permitting private health insurance will weaken the public health system.

"Canada's single payer health insurance system has become fiscally unsustainable because of federal cost sharing, transfers from "have" to "have not" provinces, and borrowing from future generations of Canadians," said Prof. Emery today.

"As the federal share of health spending has fallen provincial governments have struggled to meet health care demands creating political and legal challenges to the system," said Emery. "Maintaining the current system can only be accomplished by transfers from the federal government and so continuing those past practices that have lead us to where we are today; a system with which many Canadians are growing increasingly frustrated."

Emery uses economic modelling to demonstrate that unless the system changes and taxpayers realize the true cost of the system, Canada could face a political crisis.