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A Needs-Based Allocation Formula for Canada Health Transfer

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  • Gregory Marchildon
  • Haizhen Mou

Abstract

We analyze the expected impact of the new Canada Health Transfer (CHT) on the capacity of Canadian provinces to provide universal Medicare coverage. We found the new CHT formula, recently redesigned by the federal government, fails to address the differing capacity of provinces to provide Medicare coverage due to the unavoidably higher costs imposed by the population's age structure and geographical dispersion. We propose a modified capitation formula that adjusts for these "unavoidable" cost factors. The redistributive impact on the provinces is examined as well as the extent to which the proposed CHT fits with other federal transfer, especially Equalization.

Suggested Citation

  • Gregory Marchildon & Haizhen Mou, 2014. "A Needs-Based Allocation Formula for Canada Health Transfer," Canadian Public Policy, University of Toronto Press, vol. 40(3), pages 209-223, September.
    • Handle: RePEc:cpp:issued:v:40:y:2014:i:3:p:209-223
    DOI: 10.3138/cpp.2013-052
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    Cited by:

    1. Hajizadeh, Mohammad & Keays, Daniel, 2023. "Ten years after the 2015 Canada Health Transfer reform: A persistent equity concern of insufficient risk-equalization," Health Policy, Elsevier, vol. 129(C).

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