Latest data confirms Institutional care as primary cost driver of provincial health spending.

According to recent data released by the Canadian Institute for Health Information, institutional care (hospitals, nursing homes, and other long term care facilities) continues to drive provincial health spending. The Provincial Government Fiscal Report 2002 shows that although overall health spending is continuing to slowly shift from inpatient to outpatient services, institutional care still accounts for more than half of all provincial health spending, while physicians and other health professionals account for 22 percent, and drugs account for another 7.7 percent of provincial health spending.

 

 

For the 2001/02 fiscal year, total provincial and territorial health spending grew by 7.5 percent over the previous year. Over 50% of this increase in spending can be accounted for by institutions and health professionals: Hospitals and other institutions accounted for over 35% of the growth, followed by spending on physicians and other health professionals (22%). Prescription drugs accounted for nearly 17 percent of provincial territorial health spending growth.

As Canada's population ages, containing the costs of institutional care will become increasingly important to the financial viability of health care in Canada. Shifting health costs from inpatient care to prescription drugs and outpatient services not only improves the quality of care for most patients, it also is a cost-effective approach to meeting the increasing need for health services by an ageing population.