Healthcare for an Aging Population Confronts Nova Scotia with a $99 Billion Fiscal Glacier - C.D. Howe Institute

TORONTO, Feb. 13, 2013 /CNW/ - Nova Scotians carry a $99 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 the Cost of Healthcare for an Aging Population: Nova Scotia's Healthcare Glacier," authors Colin Busby and William B.P. Robson recommend that Nova Scotia prefund selected healthcare services and benchmark against other provinces to get better health bang for their tax bucks, particularly with regard to its high spending on drugs, and nursing and residential care.

"Our projections show the share of demographically sensitive programs, including healthcare, education and other age-based programs, rising from 18.5 percent of provincial GDP today to 33.0 percent over the next five decades, said Colin Busby. "To meet these demands from its own resources, Nova Scotia would have to increase the tax bite from incomes by 70 percent," added Busby.

The study projects Nova Scotia'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 Nova Scotia spends less than most provinces on capital and "public health," which includes health promotion activities, it spends more on drugs than any other province. It also has a relatively high budget for "other institutions," such as nursing homes and residential care homes.

"Comparing bang-for-buck in these areas with other provinces could help Nova Scotia deliver quality care without compromising other fiscal goals, notably fair tax rates for tomorrow's working population," commented William 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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