How to Fill Manitoba's $100 billion Healthcare Funding Gap - C.D. Howe Institute

TORONTO, Jan. 23, 2013 /CNW/ - Manitobans carry a $100 billion fiscal burden - the higher tax bill for increased healthcare costs over the next half-century - and should prepare now for the coming demographic squeeze, says a report released today from the C.D. Howe Institute. In "Managing the Cost of Healthcare for an Aging Population: Manitoba's Looming Funding Gap," authors Colin Busby and William B.P. Robson recommend that Manitoba prefund selected healthcare services, and find cost savings and efficiencies by benchmarking against other provinces that get better bang for their bucks in some areas.

"A key question for Manitobans is whether the fiscal consequences of a growing healthcare budget will squeeze healthcare itself, or other budgetary priorities. Publicly funded healthcare's claim on provincial resources continues to rise," said Colin Busby. "Our projections show the share of demographically sensitive programs, including healthcare, education and other age-based programs, rising from 15.9 percent of provincial GDP today to 23.7 percent in 50 years' time. Meeting these demands from its own resources would require the Manitoba government to raise its tax bite from Manitoban incomes by about 80 percent," added Busby.

The study projects Manitoba's population and the impact of demographic change on government revenues and programs. Among its recommendations:

• Prefunding: finance some healthcare services similarly to the Canada Pension Plan, which converted from pay-as-you-go to a model in which a portion of premiums collected from participants today prefunds their own benefits in the future.
• Benchmarking best practices: while Manitoba spends less than most provinces on drugs, its spending on a variety of services such as health research, home care, and training adds up to more than comparable spending elsewhere. "Comparing bang-for-buck in these areas could help Manitoba improve quality of care while ensuring that demographic change does not put healthcare on a collision course with other fiscal priorities," commented William Robson.

For the report go to: http://www.cdhowe.org/managing-the-cost-of-healthcare-for-an-aging-population-manitoba/20171

SOURCE: C.D. Howe Institute

Colin Busby, Senior Policy Analyst, or William Robson, President and CEO, C.D. Howe Institute; 1-416-865-1904; email: [email protected].