The Canadian Health Care System

An understanding of the Canadian health care system is a requirement if you want to become a registered nurse in Canada. The nursing entrance test for Canada will test your knowledge of Canadian healthcare as this is required as part of the entry level nursing competencies.

Your own knowledge and understanding of "a health care system" may be completely different from the Canadian health care system.

The entry level competencies for a registered nurse in Canada require an understanding of the overall organization of the Canadian healthcare system.

This explanation of Canadian healthcare is offered so that you have a better understanding of the overall system, how it is organized and the Canadian social values on which it is built and maintained.

This should help you in selecting the correct answers on the Canadian Registered Nurse Exam.

You can expect to see some questions on the Canadian nursing entrance test that require this knowledge as a foundation for understanding the context of the question.

The Canadian government believes in its responsibility to protect the health and well being of the Canadian population. This was the basic underlying value for the passing of the Canada Health Act.

It was federal legislation – first the Hospital Insurance and Diagnostic Services Act (1957) and then the Medical Care Act (1966) that, along with federal money, established a national approach to health care in Canada. And when extra-billing and user fees threatened the accessibility of medicare, the federal government responded with the Canada Health Act. These actions reflect Canadians’ belief that access to health care services was not only a personal, community or provincial issue, but also a national issue that demanded active participation by the federal government. (p46)

Romanow Report Building on Values, The Future of Health Care in Canada

The delivery of care is primarily a provincial jurisdiction but the provinces rely on the transfer of money from the federal government in order to do this.

The Basics

Doctors Go On Strike

In response to a proposal made in 1962 that the provincial health care insurance plan be extended to included physician services the doctors went on strike.

As a result physician services were left out of the plan and a third-party billing system was implemented. This system remains in place today.

Nurses, social workers, hospital pharmacists and other health care workers are salaried but physicians remain self-employed.
• doctors work in the community in their own offices. They are not employed by hospitals but rather are given permission to admit their patients to the hospital when they need hospital services


• when physicians provide care to a patient they send a bill to the government and are paid according to an agreed upon fee schedule.


• the physicians in each province negotiate with the government for how they are paid and what benefits they receive and are subject to the terms and conditions of labor laws which regulate union strikes in the health care sector.


• nurses who work in a hospital would be employees of that hospital or health region.


• hospitals are run by governing boards and must be non-profit


• hospitals and other agencies that deliver health care services receive money from the provincial government annually for their operating budgets. Capital expenses are also negotiated with the provincial government as it is the provincial level of authority who holds the purse strings.

How is the Canadian Health Care System Funded?

The Canadian health care system is publicly funded which means that it is funded primarily by taxes instead of private payment.

Taxes are collected and sent to the federal government. The federal government gives some of this money back to the province for health care. This is called a "transfer payment".

Under the Canada Health Act the provincial governments are required to report annually to the federal government about activities and funding issues in the delivery of health care services. There is a complex formula used to determine the amount of the funds that are transferred back to the provincial government.

Despite the fact that the Canadian health care system is publicly funded, health care is not "free". Many goods and services are not covered under provincial health insurance plans and must be paid for privately. This would include services like:

• physiotherapy provided as an outpatient
• chiropractic treatments
• family counselling
• drug and alcohol counselling
• home health equipment like bedpans, hospital beds, and wheelchairs
• prescriptions
......................and much more.

Some Canadians may carry private insurance through their employment that will help with some of these costs but they are not part of the basic level of health insurance provided through the provincial health insurance plans.

Extended health benefits are usually negotiated through the collective bargaining process with unions.

A Personal Experience with the Canadian Health Care System

Beverly falls and injures her leg. Her husband takes her to the nearest emergency center where she is seen by a physician.

Her leg is leg X-rayed and a diagnosis of fractured tibia is made. The physician on duty applies the cast and Beverly is sent home on crutches.

Beverly follows up her care with a visit to her own personal physician and two follow up visits to the outpatient cast clinic at the hospital. On one visit to the outpatient clinic her cast is changed and on the final visit the cast is removed.

When Beverly was first admitted to the emergency room she was required to show her personal health insurance information. At no time was Beverly's ability to pay for service questioned and no bill was delivered for physician services, hospital services or any of the tests.

Beverly did have to pay for the crutches. And YES this really did happen to me!