Health Expenditures in Canada by Age and Sex, 1980-81 to 2000-01

Health Expenditures by Category

The main categories of expenditure were analysed to understand the distribution of public and private health expenditures among people of different age groups and between both sexes. These categories are: hospitals; other institutions; physicians; other professionals (mainly dentists); drugs; home care services; and other expenditures.

Hospital Expenditures

In 2000-01, hospital expenditures represented 44.0% of provincial and territorial government total health expenditures, while in the private sector, hospital expenditures accounted for 8.5% of total private sector health expenditures. In that same year, the public share of hospital expenditures throughout Canada was 92.0%.

Hospital expenditures in the private sector mainly consist of differential charges for preferred accommodations (private rooms), chronic care copayments, charges for services to non-residents of Canada and to uninsured residents, and charges for services that are not medically necessary, such as plastic surgery.

Hospital expenditures in the private sector were $80 per capita, compared to $906 per capita for provincial and territorial government health expenditures.

Provincial and territorial government hospital expenditures were significantly higher for females at $1,005 per capita than for males at $805 per capita.

In the private sector, hospital expenditures were also higher for females at $89 per capita than for males at $70 per capita. The higher per capita hospital expenditures for women reflect a higher utilization rate in the early age groups.

Hospital expenditures for newborns represented about 4% of hospital expenditures for the total population. According to Health Canada estimates, depending on the province or territory, between 50% and 60% of hospital expenditures in the 0-14 age group are made for newborns.

From 1990-91 to 2000-01, per capita provincial and territorial government hospital expenditures increased for all age groups. People in the 85+ age group accounted for the largest increase at $623 per capita (an increase of 7.0%), followed by people in the 65-74 age group at $282 per capita (an increase of 13.6%). The highest increase for males was in the 85+ age group at $998 per capita, while females in the 85+ age group accounted for an increase of $458 per capita.

In 2000-01, hospital expenditures for seniors aged 65+ in the private sector were $354 per capita, compared to $3,960 per capita for provincial and territorial government health expenditures.

In comparison, the younger age groups increased much less in the same period: the 15-24 age group by $25; the 25-34 by $46; the 35-44 age group by about $59; and the 45-54 by $46 per capita.

Other Institution Expenditures

Other institution expenditures are funded 70.5% by the public sector. The private share of other institution expenditures at 29.5% corresponds to the payments for people in residential care facilities, such as nursing homes.

In 2000-01, other institution expenditures represented 9.7% of provincial and territorial government total health expenditures. Those made by the private sector represented 9.3% of private sector total health expenditures. Most expenditures in this category are made for seniors aged 65+.

From 1990-91 to 2000-01, provincial and territorial government other institution expenditures increased from $149 per capita to $200 per capita or 34.2%. In 2000-01, these expenditures were higher for females at $270 per capita than for males at $128 per capita. Females live longer and are therefore more likely to require residential care facility services for a longer period of time.

In 2000-01, per capita provincial and territorial government other institution expenditures for seniors aged 65+ were much higher for females at $1,736, than for males at $902 per capita. The average for both sexes for seniors aged 65+ was $1,380 per capita.

From 1990-91 to 2000-01, private sector other institution expenditures increased from $59 per capita to $87 per capita. In 2000-01, private sector other institution expenditures for seniors aged 65+ were $592 per capita. They were $388 per capita for males and $744 per capita for females.

In recent years, continuing care has evolved, from being provided only in hospitals and residential care facilities, to be more and more provided in assisted living housing, group homes, campuses for seniors and other environments. Although these changes are not captured here, they have had an real impact on the utilization and cost of health care services. It is generally accepted that people who become seniors in the next 20 years will be healthier than seniors are today. Thus it is expected that utilization of health services by seniors will decrease on a per capita basis. To better assess these factors, detailed figures on continuing care expenditures are needed.

Physician Expenditures

Physician expenditures are primarily funded by the public sector. In 2000-01, the public share of physician expenditures was about 99%.

In 2000-01, physician expenditures represented 20.0% of total provincial and territorial government health expenditures. In the private sector, physician expenditures represented 0.6% of total health expenditures. In the same fiscal year, provincial and territorial government expenditures for physicians were $411 per capita, and $6 per capita for the private sector.

Per capita provincial and territorial government physician expenditures were $479 per capita for females, $137 higher than for males at $342 per capita. This reflects a higher utilization of physician services by females, especially in the early to mid-age groups. The Statistics Canada National Population Health Survey shows that, in 1998, for the age groups 15 to 34, physician consultations by females per population unit were more than double that for males.

In 2000-01, provincial and territorial government physician expenditures for seniors aged 65+ were $913 per capita, while they were only $13 per capita for the private sector.

From 1990-91 to 2000-01, provincial and territorial government physician expenditures increased by 23.8%, from $332 per capita to $411 per capita. From 1990-91 to 2000-01, physician expenditures increased the most in the 75-84 age group, by $267 per capita, and in the 65-74 age group, by $199 per capita.

On a per capita basis, in 2000-01, Ontario at $1,052 spent the most for seniors aged 65+, and Prince Edward Island at $579 per capita spent the least.

From a percentage distribution perspective, in 2000-01, Nova Scotia at 32.2% had the highest percentage of its physician expenditures going to seniors aged 65+, while Alberta at 22.8% had the lowest percentage. However, when looking at age standardized figures, Nova Scotia at 31.1% spent the most on seniors aged 65+, and Saskatchewan at 26.3% spent the least.

Other Professional Expenditures

Other professional expenditures include payments for dentists, optometrists and health professionals other than physicians.

In general, public coverage is provided for specific groups, such as children, seniors and people on welfare, and for specific services, such as dental services and eye examinations.

In 2000-01, the public share of other professional expenditures was 10% and the private share was 90%.

In the same fiscal year, expenditures for health professionals other than physicians represented only 1.2% of total provincial and territorial government health expenditures. Private sector expenditures for health professionals other than physicians represented 35.8% of total private sector health expenditures.

In 2000-01, other professional expenditures in the private sector were $333 per capita, compared to $25 per capita for provincial and territorial governments.

From 1990-91 to 2000-01, provincial and territorial government other professional expenditures decreased from $28 per capita to $25 per capita or 10.7%. Almost all age groups experienced decreases during this time period. The 65-74 and 75-84 age groups accounted for the largest decreases at $23 per capita and $11 per capita, respectively.

In 2000-01, provincial and territorial government expenditures for other professionals were $28 per capita for females and $21 per capita for males. In the private sector, they were $346 per capita for females and $319 per capita for males. Statistics Canada Health Indicators Data Base show that females have a slightly higher per capita utilization rate than males for both dental visits and eye exams.

Drug Expenditures

Drug expenditures consist of prescribed drugs, nonprescribed drugs (over-the-counter medications) and personal health supplies. In 2000-01, the public share of total drug expenditures was 34%. In 2000-01, the private share of drug expenditures was about 66%. It must be noted that the public share consists essentially of prescribed drug expenditures.

In 2000-01, prescribed drug expenditures represented about 78% of total drug expenditures. Currently, about 50% of all prescribed drug expenditures are funded by the public sector. Other drug expenditures, such as over-the-counter medications and personal health supplies, are all paid by the private sector.

In 2000-01, provincial and territorial government drug expenditures represented 7.0% of their total health expenditures. For the private sector, drugs accounted for 34.7% of their total health expenditures.

Drug expenditures represented one of the fastest growing categories of expenditure in both the public and private sectors. Provincial and territorial government drug expenditures were $144 per capita in 2000-01, up 82.3% from the 1990-91 level of $79 per capita. In the private sector, drug expenditures were $323 per capita, up 87.8% from the 1990-91 level of $172 per capita.

Provincial and territorial drug expenditures for seniors aged 65+ were $744 per capita in 2000-01, and $848 and $829 per capita, respectively, for the 75-84 and 85+ age groups. Private sector drug expenditures for seniors aged 65+ were $606 per capita in 2000-01, and $603 and $543 per capita, respectively, for the 75-84 and 85+ age groups.

Provincial and territorial government drug expenditures were higher for females at $161 per capita than for males at $128 per capita. However, they were higher by $48 per capita for males in the 85+ age group and higher by $27 per capita for males in the 75-84 age group. This reflects variances in utilization rates. The Statistics Canada Health Indicators 1999 Data Base shows that per capita use of medications was higher for males in the 75+ age groups.

Home Care Expenditures

Home care professional services are almost totally covered by the public system. Two-thirds of home care non-professional services are paid by government programs.

Per capita provincial and territorial government home care expenditures have increased significantly over the past decade. Increases reflect changes made by provincial and territorial governments to move health care services from acute care institutional settings to community home-based delivery.

Health Canada estimated the private sector home care expenditures using tabulations derived from Statistics Canada surveys and with information obtained from private providers of home care services. In 2000-01, the public share of home care expenditures was estimated at 78.1% and the private share at 21.9%.

In 2000-01, home care expenditures represented 2.7% of total private sector health expenditures. On the other hand, home care expenditures represented 4.3% of total provincial and territorial government health expenditures.

In 2000-01, home care expenditures in the private sector were $25 per capita. In comparison, provincial and territorial government home care expenditures were $88 per capita in 2000-01, and had increased by 144.4% from the 1990-91 level of $36 per capita.

About 73.9% of home care expenditures were made for the 65+ age group, which corresponded, in 2000-01, to a figure of $663 per capita, if home care expenditures in other public sectors are excluded.

Home care expenditures were $113 per capita for females and $62 per capita for males. The Statistics Canada Health Indicators 1999 Data Base shows that, in 1996-97, the proportion of people in the 55-74 age groups reporting the use of home care over the total population of this age group was higher for females than for males.

Other Health Expenditures

In the public sector, other health expenditures consist of expenditures for public health, ambulance services, health research, administration, medical aids, appliances and prostheses, capital costs and miscellaneous items. In the private sector, other expenditures consist mainly of expenditures for administration, health research and capital costs.

In 2000-01, other health expenditures represented 13.8% of total provincial and territorial government health expenditures.

Other health expenditures represented 8.4% of total private sector health expenditures in 2000-01.

In 2000-01, provincial and territorial government other health expenditures were $284 per capita, up 66.1% or $99 from the 1990-91 level of $171 per capita. These expenditures were $256 per capita for males and $312 per capita for females. People in the 65+ age group spent $608 per capita on these other expenditures in 2000-01.

Concluding Remarks

The analysis of health expenditures by age and sex has shown that about 43% of health expenditures were made for seniors aged 65+ in 2000-01, while seniors aged 65+ accounted for 12.5% of the total population. The analysis has also shown that, from 1980-81 to 2000-01, the share of health expenditures for seniors aged 65+ increased less (22.0%) than their share of the population (33.0%).

The analysis has shown that health expenditures made for seniors aged 85+ were higher on a per capita basis, about nine times the average for all age groups. In addition, most of these health expenditures made for seniors aged 85+ are from hospital and other institution expenditures. Surprisingly, in other categories of expenditure, about the same amount per capita was spent for seniors aged 85+ as for the other age groups. The exception is, of course, home care services, which are mainly used by seniors for continuing and palliative care.

This study allocated past and current health expenditures by age group and sex. It did not forecast how the health care system will evolve in the future and what impact that evolution will have on health spending. To prepare such a projection, at the minimum, one would need to make assumptions on our future health status, new technologies, breakthroughs in drugs and new models of health care service delivery.

The analysis of private sector health expenditures by age and sex has shown that much better health expenditure data are needed for the private sector in order to better understand the distribution of health expenditures among seniors and other age groups.