The Effects of Population Ageing on the Canadian Health Care System

There is probably no policy-maker in Canada who has not heard "the boom, bust and echo" mantra of David Foot (1996) by now. Even those who have not fallen prey to Foot's mantra are aware that between 2025 and 2031, the population aged 65 and over will reach between 20 and 25 percent of the total Canadian population. While the timing of this trend is somewhat later for Canada than it is for some northern and western European countries, policy makers in Canada and in many other countries of the Organisation for Economic Co-operation and Development (OECD) are receiving conflicting messages about what the future growth of the elderly population will mean for the provision of health care services and health care expenditures. There are those who believe that because seniors account for a disproportionate part of health expenditures relative to their proportion of the population, that as this proportion grows health care expenditures will either explode or the health care system will have to be reconstructed in ways which are incompatible with the current values of health care systems in Canada as defined by the Canada Health Act (i.e., public administration, comprehensiveness, universality, portability, and accessibility). Alternatively, there are those who believe that the growth in the seniors population is only one component which is driving costs and that those components are manageable. In this paper, the relationship between population ageing and future health care costs is assessed based on evidence from the Canadian and international literature on this topic. The contributing factors to health care system costs and how they interface with an ageing population are identified. The paper also assesses where new research is needed if the publicly-financed health care system is to evolve to respond to the needs of an ageing population in a fiscally and socially responsible manner.