Managing Healthcare for an Aging Population: Does the Demographic Glacier Portend a Fiscal Ice-Age in Ontario?

11 Pages Posted: 29 Jun 2013 Last revised: 2 Jul 2013

Date Written: January 30, 2013

Abstract

“If we do not seize the opportunity now to begin creating a system that delivers more value for the money we spend, Ontarians a decade or two hence will face options far less attractive than the ones we face today…. [T]hey will be confronted with steadily escalating costs that force them to choose either to forgo many other government services that they treasure, pay higher taxes to cover a relentlessly growing health care bill, or privatize parts of the health care system….” Commission on the Reform of Ontario’s Public Services. Public Services for Ontarians: A Path to Sustainability and Excellence (Ontario 2012, p. 27).

Ontarians carry a $1.4 trillion 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: Does the Demographic Glacier Portend a Fiscal Ice-Age in Ontario?” authors Colin Busby and William B.P. Robson recommend that Ontario prefund selected healthcare services and benchmark against other provinces to get better health bang for their tax bucks.

“Publicly funded healthcare’s claim on provincial resources continues to rise in Ontario,” said Colin Busby. “Our projections show the share of demographically sensitive programs, including healthcare, education and other age-based programs, rising from 14.1 percent of provincial GDP today to 23.3 percent over the next five decades. Meeting these demands from its own resources would require the province to increase its tax bite from Ontarians’ incomes by 60 percent,” added Busby.

Keywords: Healthcare, Social Policy, Health Policy, aging population, Ontario

JEL Classification: I10, I18, H51

Suggested Citation

Busby, Colin and Robson, William B. P., Managing Healthcare for an Aging Population: Does the Demographic Glacier Portend a Fiscal Ice-Age in Ontario? (January 30, 2013). C.D. Howe Institute E-brief 148. Available at SSRN: https://ssrn.com/abstract=2286811 or http://dx.doi.org/10.2139/ssrn.2286811

Colin Busby

C.D. Howe Institute ( email )

67 Yonge St., Suite 300
Toronto, Ontario M5E 1J8
Canada

William B. P. Robson (Contact Author)

C.D. Howe Institute ( email )

67 Yonge Street
Suite 300
Toronto, Ontario M5E 1J8
Canada
416-865-1904 (Phone)
416-865-1866 (Fax)

HOME PAGE: http://www.cdhowe.org

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