Author
Canadian Health Policy Institute (CHPI) annual report.
Introduction
The cost and use of medical technologies is often blamed for fast rates of growth in health care spending. Subsequently, significant public resources are spent by governments in Canada to control spending on medical technologies. What is the actual impact of medical technology spending on total health care costs? Does the level of spending on medical technologies in Canada justify current cost containment efforts? Is Canada actually under-investing in medical devices relative to other countries?
Objective
To examine the particular impact of medical device expenditures on total health care costs in Canada versus other countries; and to compare the affordability of medical device expenditures relative to per capita GDP in Canada versus other countries.
Data
Data on medical device expenditures (excluding pharmaceuticals), total health spending, and GDP were obtained from World Medical Markets Fact Book 2014 published by Espicom covering 72 countries over the period 2009 to 2014.
Results
On average from 2009 to 2014, of 72 countries for which data were available, Canada ranked 8th for total health spending per capita, but only 13th for medical device spending per capita and 60th when measuring medical device spending as a percentage of total health spending. Canada ranked as low as 35th for medical device spending as a percentage of GDP per capita. Medical device spending per capita accounted for only 0.38% of GDP per capita in Canada on average over 2009 to 2014.
Conclusion
Over the period 2009 to 2014 spending on medical devices had a very small impact on overall health care costs and was affordable relative to GDP. Given the tiny proportional impact of medical device spending, cost containment efforts targeting medical devices in Canada are not likely to produce large overall savings on total health care costs. Paradoxically, economic research suggests that greater investment in the use of medical technologies is more likely to result in greater potential savings on total health care costs.
