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Time to grow social and education spending—it’s key to good health

Medical care and social investments are not an either/or proposition.

November 1, 2023

9-minute read

When it comes to making wise choices about health, Canadians have a thorny problem. Since we often distinguish ourselves from our American neighbours by emphasizing our publicly funded medical care, this system is beloved and as much a part of Canadian identity as the maple leaf and hockey.

So when asked by pollsters what policy areas should receive priority attention for additional taxpayer funding, medical care is generally at or near the top. It has become a cultural habit to think this way. That’s why public dialogue often centres around questions like how much more we should invest in medical care? Whether this funding should be delivered through public or private clinics? Or how much of it should be used to pay doctors?

These issues are important, but they will never be enough to make us healthy because the medical system was designed to treat people after they’ve fallen ill or been injured. It wasn’t designed to create health.

A health system is much broader than medical care. Unfortunately, Canadians have left that broader system unfinished, and now we’re paying the price. Medical costs are rising, but access isn’t, leaving many patients feeling frustrated by long wait lists, and doctors and nurses are burned out.

It is time to make room for something more. We need to re-energize public investment where health begins, in part by finding a better balance between investing in the building blocks for a healthy society relative to investments in medicine to treat illness and injury. So long as Canadians can’t access safe homes, good income, quality child care, and a healthy environment, our medical care system will never be enough to prevent people from dying early.

This means disrupting the myth that medical care is what makes us healthy. Decades of health science show that access to medical care is a relatively modest factor in shaping health outcomes. Much more important are social and ecological determinants of health—the conditions into which we are born, grow, live, work and age.

These factors are shaped by social and environmental departments in governments that are responsible for reducing poverty, improving the affordability of housing and child care, truth and reconciliation, fighting climate change and more. They are very little shaped by departments of health.

The evidence base for putting health-in-all-policies (HiAP) is growing in Canada and across the globe. This literature invites governments to pay careful attention to how they allocate their annual budgets. The budget priorities set around cabinet tables have far-reaching health implications because they determine how resources are distributed between medical and non-medical ministries.

Evidence on what distribution promotes health is now clear: governments are more likely to improve life expectancy and reduce avoidable mortality and illness when their budgets grow spending on social programs and benefits more urgently than spending on medical care services.

Provinces used to align better with the science of health-in-all-policies

There was a time when provincial budgets regularly aligned with HiAP evidence. Table 1 shows the ratio for social and education spending relative to medical spending (the SE/M ratio) for around 1976 (when provinces were about a decade into their experiment of building a health system) and 2019 (the final year before the COVID-19 pandemic). A ratio above one signals that social and education spending are larger than medical spending in that year. A ratio below one signals the opposite.

Around 1976, provinces routinely spent more on social and education investments than on medical care. By 2019, the opposite had become the norm.

For example, in 1976, B.C., Alberta, Ontario and Quebec—the four provinces where the vast majority of Canadians reside—spent between 16 and 53 per cent more on social and education programs than medical care. By the time the pandemic arrived, these provinces were spending between five and 28 per cent less on social and education services compared to medicine.

This doesn’t necessarily mean social and education spending have been cut. Rather, provinces didn’t invest in these programs with the same level of urgency as they did medical care. Take B.C., for example. By 2019, B.C. had the lowest SE/M ratio of the four big provinces. After adjusting for inflation, the province increased spending on social programs by approximately $4 billion per year and education spending by $6.4 billion. However, increases to medical spending overshadowed both, at $17.9 billion per year.

A similar pattern shows up in Ontario, which had the highest SE/M ratio of the most populous provinces. By 2019, annual social and education spending increased by approximately $13 billion and $30.4 billion respectively. In contrast, medical care received an extra $49.2 billion annually.

When investments to prevent sickness and promote health do not keep pace with investments to treat illness, it is unsurprising that medical costs keep rising. It’s also unsurprising that some medical professionals are burning out from their patient loads, even as there are more doctors per capita. According to the Canadian Institute for Health Information, there were 143 physicians for every 100,000 Canadians in 1976, 72 of whom were family doctors. By 2020, there were 242 physicians, 123 of whom are family physicians.

The rapid investment in medical care compared to social and education investments over the past few decades partly reflects that Canada’s population is aging. The growing number of Canadians age 65+ will use more medical care in their remaining years than they did in their first 65. An aging population also brings more complex care needs to health professionals, somewhat blunting the effect of the rising number of doctors per capita.

Still, as my colleague Lynell Anderson and I have argued, relatively large increases in medical spending also reflect the Canadian cultural habit to prioritize medicine because of its connection to our national identity—that thorny problem to which I referred at the outset.

This cultural habit was disrupted by our collective response to COVID-19. During the pandemic, there was a notable shift in the pattern of SE/M spending due to efforts to mitigate the harms caused to the economy and household finances as a result of the need for physical distancing. In B.C., for example, sizable provincial investments in income support, education, housing and child care outpaced new spending on medical care by roughly one-third.

However, the most recent B.C. budget also reveals that renewed emphasis on social spending during the pandemic may be short-lived. Projections for the next three years point to a budget plan where the SE/M ratio for the flow of new spending up to 2025-26 will be just 0.45. This means the annual increase in spending on social services and education by 2025-26 is expected to be just 45 per cent of the budgeted increase for medical care.

The federal government has been better aligned with health-in-all-policies science

As provinces have retreated from leadership on investing in the social determinants of health compared to investing in medical care, the federal government has stepped up. This was especially notable during the pandemic. Federal emergency response spending in 2021 directed several times more money to income supports (like the Canadian Emergency Response Benefit and the Canada Emergency Wage Subsidy) compared to additional investments in the medical system.

Even well before the pandemic, the federal government had been aligning its level of social investment more closely with evidence about HiAP, compensating for provincial budgets that lost sight of what makes Canadians healthy and well.

For example, Table 2 shows the ratio of federal spending on social and educational services compared to provinces in 1976 and 2019. Whereas Ottawa consistently spent less than provincial governments did on these issues in 1976, by 2019 Ottawa had increased its proportion of social spending. In most provinces, the federal government is now spending more on social issues than its provincial counterparts.

Take B.C. and Ontario, again, as key examples. After adjusting for inflation, B.C. increased annual social and education spending by approximately $10.3 billion, including federal funds delivered to the province via the Canada Social Transfer and other intergovernmental transfers.

Over the same period, the federal government increased annual spending for British Columbians on the Canada Child Benefit (CCB), Employment Insurance (EI), Old Age Security (OAS, including the Guaranteed annual income for seniors) and the Canada Pension Plan (CPP) by $15.9 billion.

Similarly, Ontario increased social and education investment by $43.5 billion per year, including funding transferred from Ottawa. Simultaneously, the federal government increased its investments in Ontario for income support to families, retirees and through EI by $43.2 billion.

It is worth noting that there is a marked age imbalance to the federal increase in social spending. Back in 1976, federal spending on retirement income support through OAS and the CPP was roughly the same value as federal spending on EI and what then counted as the CCB. In 2019, spending on OAS and CPP was 160 per cent higher than spending on EI and the CCB.

This signals that the Government of Canada is better at applying the logic of health-in-all-policies to investments for retirees than it is on spending that primarily benefits younger residents. Similar age imbalances can be found in provincial budgets, because increases to medical care spending disproportionately benefit Canadians over age 65.

Solution: Apply health-in-all-policies to budget allocations between ministries

As we revisit what is required to complete our health system, it is timely to recall the wisdom of Tommy Douglas. He is often recognized as the father of Canada’s health care system and regularly judged to be among the greatest Canadians.

“Let’s not forget,” he urged us all when retiring from politics, “that the ultimate goal of Medicare must be to keep people well rather than just patching them up when they get sick.”

It’s time to rally around this goal once again. This is why partners have come together to launch Get Well Canada—an alliance of researchers, community leaders and medical professionals who want to fulfill the promise of Canada’s commitment to health care.

The logic motivating our alliance is summed by this well-known proverb: “An ounce of prevention is worth a pound of cure.” To preserve health care as a sacred trust, we must invest to make people well, not just treat them when they fall sick.

Just as we are grateful that we can call on the fire department to put out the flames when we need them, we also know that preventing fires is much less deadly, damaging and costly. It’s the same with health care. Waiting to invest until people are ill is like showing up with hoses once the fire is already raging. Earlier action through social and education investments has potential to prevent the first sparks from getting out of hand.

Get Well Canada calls on governments to reduce pressure on the medical care system and tackle the affordability crisis via a single winning strategy: restore a better balance between investments in the social determinants of health, and investments in medical care to treat illness and injury.

Growing social investments will not only reduce cost of living pressures, it will help promote health and prevent illness. Tackling these two issues together can contribute to slowing the flow of sickness that is demoralizing our health professionals and overcrowding clinics and hospitals.

Get Well Canada calls for three actions:

  1. Better tracking and reporting: Prime Minister Justin Trudeau has observed: “What gets measured gets done.” Governments are far less likely to fix our incomplete health system if they do not carefully monitor the ratio of social spending relative to medical spending. That’s why we want Ottawa and the provinces to integrate this ratio as a key performance indicator in annual budgets and other fiscal documentation.  To support this, we want the Canadian Institute for Health Information (CIHI) to feature this ratio in its annual reporting. Regrettably, CIHI currently reinforces a narrow definition of health care by almost entirely reporting about spending on medicine, with very little attention to more influential spending on social determinants. Regular CIHI reporting on the ratio of social-to-medical spending will create opportunities to identify the underdeveloped parts of our health system, providing information relevant to voters and government officials
  2. Better budgets: Better reporting of the ratio is the starting point for more balanced budget allocations. Governments should use their annual budgets to grow social investments more urgently than spending on medical care. This is the best strategy to make Canadians happier, healthier, wealthier and more resilient for generations to come.
  3. Culture change: Canadians must broaden our understanding of health, so that we empower our politicians to recall that health begins where we are born, grow, live, work and age. Health does not start with medical care.

These three Get Well Canada actions aim to bring to scale the social prescription movement. Many doctors, nurses and health professionals already wish they could prescribe their patients affordable housing, child care or poverty reduction. But they can’t.

And even when they connect their patients to other community resources, the dedicated organizations working in these areas often lack sufficient resources to fulfill these social prescriptions in either a timely way or in a way that adequately disrupts systemic threats imposed by power dynamics related to class, gender, race, colonialism, age and other systems of oppression.

That is why preserving Canada’s health system as a sacred trust requires applying HiAP logic at the highest level of government decision-making: provincial and federal budgets. When allocating the economic pie between various departments, governments must recognize that clinics and hospitals should be the last stop, not the first stop, in our health system. The first stops for good health are found in our neighbourhoods, jobs, child care centres and schools—something the pandemic made painfully clear.

When we act like hospitals are the starting point for good health, it’s no wonder we get stuck putting out medical care fires, and risk being burned in the process. Medical care and social investments are not an either/or proposition. They are two sides of the same coin. Provincial governments have neglected the social side for too long, leaving holes in our health system that have become fire hazards.

The solution is to Get Well Canada. It’s time once again to grow social and education spending investments even more urgently than medical spending.

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