How to Handle Saskatchewan's $82 billion Healthcare Challenge - C.D. Howe Institute

TORONTO, Jan. 23, 2013 /CNW/ - Saskatchewanites carry a $82 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 Healthcare for an Aging Population: Some Good News and Some Bad News for Saskatchewan," authors Colin Busby and William B.P. Robson recommend that Saskatchewan 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.

"Our projections show the share of demographically sensitive programs, including healthcare, education and other age-based programs, rising from 11.9 percent of provincial GDP today to 17.5 percent in 50 years' time," said Colin Busby. "Meeting these demands from its own resources would require the Saskatchewan government to increase the share of provincial income it collects to 1.7 times the current level," added Busby.

The study projects Saskatchewan'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 Saskatchewan spends less than most provinces on capital and administrative costs, it spends more on "public health," which includes food and drug safety, health inspections, health promotion and community health programs.

"Saskatchewan has set priorities according to its circumstances, but cannot be complacent," said William Robson. "In spite of its current budget surplus, Saskatchewan faces a fiscal challenge related to demographically sensitive programs that is larger than the provincial GDP, or $92,000 per person," added Robson. "Comparing bang-for-buck with other provinces could help Saskatchewan ensure that demographic change does not put healthcare on a collision course with other fiscal priorities."

For the report go to: http://www.cdhowe.org/managing-the-cost-of-healthcare-for-an-aging-population-saskatchewan/20170

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].