Rising costs for food and shelter have been a significant concern in the ongoing affordability crisis. However, recent data from the consumer price index (CPI) reveals that the expenses related to maintaining good health have also surged nearly as much as overall inflation peaked in June 2022.
The increase in health-care expenditures may not be as noticeable to many Canadians, experts suggest. This is partly due to many health costs being covered by the public health-care system, which is not factored into the CPI data, and also because out-of-pocket health expenses can be sporadic.
While rent and grocery bills are recurring expenses that consumers face regularly, other health-care costs, such as dental appointments and eye exams, may not garner the same level of attention. However, prices for health-care services have been on a steep incline in recent years, with projections indicating a further rise in the future.
The overall all-items CPI has risen by just over 11 percent since June 2022, whereas the category encompassing health and personal care has seen a more substantial increase of over 15 percent during the same period. Specifically, health-care services, including eye exams and basic dental care, have spiked by 18.5 percent, almost on par with the rise in food prices.
Moreover, the prices of dental care services and eye care goods have surged by 20 percent since June 2022. These sectors exemplify a divide within the health-care industry, characterized by cost control on one side and escalating expenses on the other.
Statistics from Statistics Canada indicate that health-care services have consistently outpaced overall inflation rates long before the COVID-19 pandemic. This trend is attributed to the nature of health and dental services, where skilled labor costs contribute significantly to the overall expenses.
The introduction of the Canadian Dental Care Plan in 2024 aimed to address health-care affordability issues, but dental care costs have continued to rise. The plan’s administration by a private insurer has led to additional out-of-pocket expenses for many Canadians seeking dental care.
Despite the escalating costs, many Canadians may not be fully aware of health-care price inflation due to the substantial coverage provided by the public health-care system. Nonetheless, the growing private burden on health-care expenses is increasingly being shouldered by individuals, with private spending outpacing public spending growth.
The risk of this additional financial burden disproportionately affecting those less financially resilient is a concern highlighted by experts. Without intervention from governments, access to essential health services may become more challenging for individuals with limited financial means.