Rising costs for food and housing have been a major concern in the current affordability crisis. However, recent data from the Consumer Price Index (CPI) reveals that the expenses for maintaining good health have also significantly increased since overall inflation peaked in June 2022.
The surge in health-care expenses may not be as noticeable to many Canadians, experts suggest. This is partly because several costs are covered by the public health-care system, which is not factored into the CPI data. Additionally, out-of-pocket health expenses are often sporadic compared to regular bills like rent and groceries.
Andrew Longhurst, a senior researcher at the Canadian Centre for Policy Alternatives (CCPA), noted that health-care prices have been following a steep upward trend in recent years, a trend that could continue to worsen. The overall all-items CPI has risen by just over 11 per cent since June 2022, while health and personal care costs have increased by over 15 per cent in the same period.
Specific health-care services, including dental care and eye care, have experienced even higher price hikes, with a noticeable 18.5 per cent increase. These services, such as eye exams and basic dental care, have seen a price surge comparable to food expenses.
Longhurst explained that dental care services and eye care products have witnessed a 20 per cent increase in prices since June 2022. He highlighted a significant divide in the health-care industry between public and private sectors, where costs are regulated on one side only.
Statistics Canada data indicates that health-care service prices have consistently outpaced overall inflation for years, with inflation in health-care services exceeding general inflation 85 per cent of the time over the past two decades. The economic structure of health and dental services, which heavily rely on skilled labor, contributes to the ongoing price escalation, according to Jimmy Jean, Vice President and Chief Economist at Desjardins Group.
Private health-care spending is on the rise, with Canadians bearing a larger burden of costs compared to public spending. A recent analysis by the CCPA revealed that private health-care spending per person increased by 8.1 per cent from 2021 to 2023, nearly twice the rate of growth in public spending.
The growing disparity in access to care based on income and the ability to afford out-of-pocket services poses a significant risk, as highlighted by Longhurst. Without government intervention at both provincial and federal levels, the gaps in access to essential health services are likely to widen, potentially impacting those who are financially less equipped to handle the additional costs.