The coming healthcare bill

As the current crisis in healthcare gets resolved, discussion is turning to how much the pandemic is going to cost the healthcare system. In America, insurers are floating significant increases in premiums. In Canada, there is yet to be any public analysis.

But consider the Ontario government’s finances. The last annual financial projection in late 2019 (pre-pandemic) showed a deficit of $9 billion, of which, pro rata, 40% was attributed to healthcare spending. This forecast assumed 5.6% unemployment and a growth in retail sales of 2.6%.

Of course, the Ontario economy will have much higher unemployment and much lower retail sales growth in 2020. And provincial healthcare spending will be much higher. Hence, deficits will grow substantially.

So, Ontario taxpayers (both corporate and individuals) are facing the prospect of much higher taxes and healthcare premiums.

To what effect? Likely, lower spending on oral healthcare.

For example, consider the Ontario employers’ group dental plan which accounts for the majority of spending on oral healthcare. Should the employer confront a significant rise in its healthcare premiums, what might it do to limit other spending on employee benefits? In the past, cost containment has focused on more co-pays and higher deductibles on dental procedures. History will likely repeat itself.

The pandemic is changing everything, including the oral component of the coming healthcare bill.