Rising expenses for food and housing have been widely discussed as contributors to the affordability crisis. However, recent consumer price index (CPI) data reveals a significant increase in the costs associated with maintaining good health since overall inflation peaked in June 2022.
The surge in healthcare expenses may not be as noticeable to many Canadians, experts suggest. This is partly because a portion of these costs are covered by the public healthcare system, which is not factored into the CPI data. Additionally, out-of-pocket health expenditures are typically sporadic, unlike regular rent or grocery bills.
Despite the lower visibility, healthcare prices have been on a notable upward trend in recent years, according to Andrew Longhurst, a senior researcher at the Canadian Centre for Policy Alternatives (CCPA). This trend is expected to intensify, especially with the aging population and provincial governments implementing fiscal restraint measures.
The overall inflation rate, measured by the all-items CPI, has increased by just over 11 percent since June 2022. In comparison, the category encompassing health and personal care has risen by over 15 percent during the same period, trailing behind shelter costs (over 16 percent) and food prices (almost 19 percent).
Specifically, the costs of health-care services, including eye exams, physiotherapy sessions, and basic dental care, have surged by 18.5 percent — nearly equivalent to the increase in food prices. Dental care services and eye care goods have experienced a 20 percent price hike since June 2022, reflecting a split between public and private sectors in the healthcare industry, leading to uncontrolled costs on one side.
Statistics from Statistics Canada indicate that health-care service prices have consistently outpaced overall inflation rates even before the COVID-19 pandemic. This trend is attributed to the economic dynamics of healthcare and dental services, where a significant portion of expenses is tied to skilled labor costs, making cost reductions challenging.
Unlike services covered by provincial health insurance, such as doctor visits, there are no constraints on the rising costs of dental and eye care services. The introduction of the Canadian Dental Care Plan in 2024 aimed to address this issue but dental care CPI numbers have continued to climb, indicating ongoing challenges in the sector.
Private healthcare spending is progressively becoming a heavier burden on Canadians compared to public spending. An analysis by the Canadian Centre for Policy Alternatives (CCPA) highlighted that private health-care spending per person grew by 8.1 percent from 2021 to 2023, nearly double the rate of public spending growth.
The increasing private burden on health care could disproportionately impact individuals who are less financially capable of bearing additional costs, potentially widening access gaps based on income levels. Longhurst emphasized the importance of government intervention to address these disparities and ensure continued access to essential healthcare services.
