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Healthcare spending to hit $331 billion in 2022 as COVID costs fall


Canada is expected to hit $331 billion in healthcare spending in 2022, according to new estimates, but the surge in spending caused by the pandemic appears to be declining – despite COVID-19 hospitalization rates surpassing those of 2021.

The Canadian Institute for Health Information (CIHI) released its annual report on national health spending trends on Thursday, presenting its estimates of how much money is spent on health care in Canada.

In 2022, Canada will spend about $8,653 on average per Canadian, according to CIHI, with total health spending accounting for 12.2% of Canada’s gross domestic product (GDP), down from a peak of 13.8 % in 2020.

Prior to the pandemic, healthcare spending was growing steadily at around 4% per year from 2015 to 2019. This growth rate spiked to a 13% increase in funding in 2020, largely attributed to the pandemic, followed by another 7% increase. health spending in 2021.

But after two years of COVID-19, that trend appears to have diminished significantly. According to CIHI estimates, total health care spending is expected to increase by only 0.8% in 2022.

“Despite leveling off in 2022, growth in health care spending in Canada continues to be driven by ongoing factors such as population aging, population growth and health service utilization,” said Ann Chapman, Director of Expenditure and Primary Care at CIHI. in a press release. “Pressure on budgets due to the pandemic is putting pressure on health system recovery efforts.”

Health care spending normally grows alongside the economy, sometimes outpacing it. COVID-19 has led to an unprecedented increase in healthcare spending in 2020.

CIHI is a not-for-profit organization that works with federal, provincial and territorial partners to bring together and present data on health care management, research and policy in Canada.

The spending report includes estimates for 2022 and 2021, as well as final health spending figures for 2020.

BREAK DOWN THE PRICE TAG

When you look at total health care spending, what services does that big sum of $331 billion represent?

Hospitals, doctors and drugs are the main spending categories, accounting for more than 50% of total healthcare spending in 2022.

Nearly a quarter of all healthcare spending in 2022 was spent on our hospitals, while doctors and medicines each account for 13.6% each.

This means hospitals will cost Canadians about $2,084 per person in 2022.

“Hospital spending growth is expected to accelerate due to efforts to eliminate surgical and other backlogs,” the statement said.

In 2020, spending on doctors fell by 3.6%, due to the postponement of many forms of care for fear that patients could contract COVID-19.

This category rebounds in 2021 and 2022, now reaching the second largest share of healthcare spending.

Spending on drugs is expected to increase by 5.4% in 2022, as the number of claims for specialty drugs continues to rise, as well as higher costs per person for drugs treating chronic conditions.

CIHI also looked at who pays for the services Canadians receive. The public sector is expected to account for 72% of total health spending in 2022, with the private sector accounting for 28%.

About 14% of all healthcare spending in 2022 will be out-of-pocket spending.

From 2000 to 2019, the public/private split remained fairly stable at 70% public, 30% private.

COVID EXPENSES PLUM EVEN IF HOSPITALIZATIONS INCREASE

A new expenditure category was introduced in 2021 called COVID-19 Response Funding, which encompasses government-budgeted funding related to COVID-19 treatment, contact tracing, vaccinations, medical goods and other expenditures. related.

In 2021, according to CIHI estimates, this category represented 9.9. percent of all health spending in Canada, but it is projected to represent only 4.4 percent of total health spending in 2022.

Federal, provincial and regional governments spent $29.3 billion in Canada on the pandemic in 2020, then about $32.5 billion in 2021, according to CIHI.

But pandemic-related spending has been halved for 2022, with governments spending only about $14.5 billion.

COVID-19 funding per person in 2022 is also expected to have fallen sharply to almost half of what it was in 2020, from $770 per person to $376.

This comes despite the fact that the number of deaths from COVID-19 has almost doubled in total since October last year.

According to the federal government, when looking at the weekly number of COVID-19 cases, the first ten weeks with the highest number of hospitalizations all occurred this year, not in 2020 or 2021.

And although hospitalizations have declined since the Omicron surge in January 2022, which caused the largest spike in cases in Canada of the entire pandemic, Canada is still seeing more hospitalizations this fall than the year. last.

According to data from the Public Health Agency of Canada, Canadian hospitals averaged about 4,700 hospitalizations per day due to COVID-19 between September 15 and October 15, 2022. During the same period last year the average was just 2,000 a day.

According to CIHI’s breakdown, the largest portion of funds allocated to fund the COVID-19 response went to COVID-19 treatment costs in 2022, at 34%. About 20% was spent on vaccinations.

SIDE BY SIDE

Healthcare expenditures vary widely as a ‘per capita’ figure depending on where you are in Canada due to a number of factors including salaries of healthcare professionals, services offered and remoteness of a population. The territories have the highest cost per person for health care, in part due to the fact that residents must be transported elsewhere for specialized services.

This is the projected breakdown for 2022, according to CIHI.

Ontario: $8,213 per person; 0.3% increase

Quebec: $8,701 per person; 1.8% decrease

Manitoba: $8,417 per person; 1.0% decline

Saskatchewan: $8,954 per person; 0.03% decrease

Alberta: $8,545 per person; 3.5% decrease

British Columbia: $8,790 per person; 2.4% increase

Newfoundland and Labrador: $9,894 per person; 1.5% increase

Prince Edward Island: $8,531 per person; 2.3% increase

Nova Scotia: $9,536 per person; 5.0% increase

New Brunswick: $8,010 per person; 0.9% increase

Yukon: $15,884 per person; 1.2% increase

Northwest Territories: $21,946 per person; 2.3% decrease

Nunavut: $21,978 per person; 8.3% decrease

Compared to other countries, Canada has one of the highest levels of health expenditure per person. Out of 38 countries, Canada’s per capita spending in 2020 (the most recent year for which comparable data is available) was among the highest, below Germany and the Netherlands, but ahead of Sweden and Australia.

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