How Canadian Health Care Works

Employee benefits service

Unlike in the United States, where health care is a mostly private enterprise, health care in Canada is delivered through a publicly funded, government managed, health care system. The system is funded primarily through income taxes. As a result, most health services are either free or involve a very small copay. For example, when a patient goes to see a doctor in Canada, the doctor will bill the government directly, rather than the patient, for reimbursement.

Costs are kept low a number of ways. For example, the administrative simplicity of the system saves Canadians millions. The system also discourages competitive practices like advertising that can drive up prices. Another that costs are kept down is by encouraging preventive health screenings, including yearly examinations, in order to catch diseases early when they can often be treated easily and less expensively.

While the system covers most medical costs, some costs are not covered. In addition, things like vision, dental, and prescription costs may not be covered. Traditionally, employers will cover these costs through additional employee benefit insurance plans. Unfortunately, while over 90% of Canadians prefer their health care system to that of the United States, 33% of Canadian small business owners do not see how offering employee benefits packages helps their business.

One solution is to implement small business health insurance tax credits. Small business health insurance tax credits would give an incentive to small businesses to continue to offer their employees benefit plans. Given these tough financial times, without a proper incentive, it is feared that many Canadians could lose their supplemental coverage.

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