New Brunswick Faces $78 Billion in Added Healthcare Costs as Population Ages - C.D. Howe Institute

TORONTO, Feb. 13, 2013 /CNW/ - New Brunswickers carry a $78 billion fiscal burden - the higher tax bill for increased healthcare costs over the next half-century - and should prepare now for the coming demographic squeeze, says a report released today from the C.D. Howe Institute. In "Managing Healthcare for an Aging Population: New Brunswick's $78 Billion Question," authors Colin Busby and William B.P. Robson recommend that New Brunswick prefund selected healthcare services and benchmark against other provinces to get better health bang for its tax bucks, particularly in regard to its relatively high spending on seniors' programs and hospitals.

"Publicly funded healthcare's claim on provincial resources continues to rise in New Brunswick," said Colin Busby. "Our projections show the share of demographically sensitive programs, including healthcare, education and other age-based programs, rising from 16.3 percent of provincial GDP today to 30.4 percent over the next five decades. Meeting these demands from its own resources would require the province to more than double the provincial tax bite from New Brunswickers' incomes," added Busby.

The study projects New Brunswick's population and the impact of demographic change on government revenues and programs. Among its recommendations:

  • Prefunding: finance selected healthcare programs similarly to the Canada Pension Plan, which converted from pay-as-you-go to a model in which a portion of premiums collected from participants today prefunds their own benefits in the future.

  • Benchmarking best practices: while New Brunswick spends less than most provinces on physicians and other health professionals, it spends much more than most on hospitals.

"If New Brunswick were to bring hospital costs in line with the national average, it would spend $330 million less annually," noted William Robson. "Comparing bang-for-buck in such areas with other provinces could help New Brunswick deliver quality care without compromising other fiscal goals, notably fair tax rates for tomorrow's working population," added Robson.

For the report go to:

SOURCE: C.D. Howe Institute

For further information:

Colin Busby, Senior Policy Analyst, or William Robson, President and CEO, C.D. Howe Institute; 1-416-865-1904; email:


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