Author
Canadian Health Policy Institute (CHPI)
Introduction
The cost and use of medical technologies is often blamed for fast rates of growth in health care spending. What is the actual impact of medical technology spending on total health care costs? Is Canada actually under-investing in medical devices relative to other countries?
Objective
This annual CHPI report examines the impact of medical device expenditures on total health care costs in Canada versus other countries, and compares the affordability of medical device expenditures relative to per capita GDP in Canada versus other countries.
Data and Method
Data on medical device expenditures (excluding pharmaceuticals), total health spending, and GDP were obtained from World Medical Markets Fact Book 2015 published by Espicom covering 75 countries over the period 2010 to 2015.
Results
On average from 2010 to 2015, of 75 countries for which data were available, Canada ranked 7th for total health spending per capita, but only 13th for medical device spending per capita and 62nd when measuring medical device spending as a percentage of total health spending. Canada ranked as low as 33rd 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 2010 to 2015.
Conclusion
Over the period 2010 to 2015 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.
