| Health
Care Expenditures in Alberta |
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Near
the end of the Millenium, Alberta was seen to be in need of
cost-containment and system reform as a consequence of a purported
dramatic
rise in health care costs over the preceding few decades. But this is akin
to expressing amazement about increases in the price of bread between
our childhood and adult life. Most
of us are aware that, over time, prices of goods and services are
influenced by inflation, population changes, and prosperity.
But the Alberta healthcare figures did not consider these factors and,
furthermore, total budget figures were used in spite of the fact that
the
population being served was much larger. To rectify this misleading
approach,
Alberta health expenditures were examined after adjustment for these
factors for the years 1975 - 2001. The line above the grey dotted area in the accompanying figure shows that government health expenditures (unadjusted) increased by about 900% over the 27 years of the study - from about $400 to $3900 per person. However, Alberta’s population grew from about 1.8 million to 3 million during that time, reducing the adjusted per-person cost to about $2300 (the line above the yellow area). Following this, the adjustment for inflation resulted in a reduction to $680 (top of the red area). In spite of increased use of health services by seniors, the adjustment to correct for the fact that the Province’s population had been aging made very little difference (to $635; red area) due to the diminishing numbers in the over 65 group. The end result, in blue, shows that when population growth, inflation, and population aging were considered, the increase proved to be a modest 65%. Moreover, personal income per person increased by 49% over that time leaving an effective increase in healthcare spending of about 18%. Notably, from 1988 to 1999, out-of-pocket expenses rose at double the rate of government expenditures. Overall, the findings indicate that there was not a crisis due to rising health care costs over the last quarter of the twentieth century in Alberta. Thus, dramatic systemic and policy changes based on this belief were not justified. |
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| Thompson AH (2004). Health care costs in Alberta in context after corrections for inflation, population growth, and the aging of the population: 1975-2001. Longwoods Review 2(4), 1-7. Click here for a copy. | |||
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