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The CCPA has released a study on the sustainability of health care spending: How Sustainable is Medicare? refuting the alarmism from the Fraser Institute about health care spending growing out of control.

The study, by CCPA-BC Senior Economist Marc Lee, finds that population aging is only a small contributor to rising health care costs, and that the system can be maintained and even enhanced without breaking the bank.

“There is no demographic time bomb waiting to go off in our health care system,” says Lee. The study finds that:

  • Over the past decade, the impact of population aging on health care spending was only 0.8% per year.
  • To keep current service levels and accommodate for future population growth, aging, and inflation, health care expenditures must rise by 4.4% per year. This is very affordable in the context of reasonable economic growth.
  • If economic growth rates in the future are consistent with those over the past decade, health care spending as a share of the economy (GDP) will actually fall over the next 50 years.
  • By dedicating the same proportion of new economic output to health care, not only will there be enough money to pay for existing services (even after population growth, aging and inflation), there will still be enough for modest expansion of services.

Lee argues that the costs of new technologies, prescription drugs, and end-of-life interventions will cost the system far more, and that decisions about how to use and pay for new technologies are best made in a public system.

Other studies (See Inside the Chaoulli ruling ) reveal that private for-profit health care actually costs more and delivers less, and that in fact public solutions to wait time problems are superior (See: Backgrounder: Solutions to Healthcare Waiting Lists).