Private Health Insurance
Comprehensive Support for your health
Private Health Insurance in Canada: What You Need to Know
Canada has an excellent public healthcare system, and it can cover the cost of various essential medical services. However, as private healthcare costs keep rising, there is an increased need for private health insurance so Canadians can afford healthcare beyond the basic provincial plans.
This article offers an introduction to the private healthcare system in Canada, including how it complements the public system, what it covers, who is eligible, and why it’s beneficial to have a form of private health coverage even with affordable public healthcare.
How Does The Canadian Health Insurance System Work?
Canada’s health insurance system, known as Medicare, is a publicly funded program. All 13 provinces and territories have their own version of Medicare, with different out-of-pocket expenses, medication access, and physician services. These plans are primarily funded by provincial and territorial revenues, payroll taxes, and sales taxes.
What does Medicare cover?
Canada’s public health insurance covers anything “medically necessary”, such as hospitalization, surgery, and primary care. However, the definition of necessary healthcare differs in each province. Rather than list each province’s healthcare coverage individually, we’ll list what they are most likely to exclude:
What Medicare does NOT cover:
- Eye and vision care
- Dental care
- Prescription medicine taken outside hospitalization
- Ambulances
- Home care
- Physiotherapy
- Prescription glasses
Private healthcare becomes necessary when provincial medical funding doesn’t cover dental work or eye care, especially since these services can be expensive and related conditions can have debilitating side effects if not treated.
Private Health Insurance Plans in Canada
Since public healthcare still excludes treatment for fairly common issues, roughly 70% of Canadians opt for supplemental private health insurance for additional costs. It’s tough to generalize the coverage you’ll get from a private health insurer since this is up to your preference and medical needs. However, most basic private health insurance plans can help cover these specific items:
- Prescription medication: If you have a serious or chronic health condition, the cost of prescription medicine can add up over time. Since public healthcare doesn’t cover prescribed medicine outside of hospitalization, private cover can make an everyday difference.
- Dental care: This includes cleanings, braces, dentures and crowns.
- Vision care: This covers eye exams, glasses, and some procedures.
- Mobility equipment: Some private healthcare insurance can pay for mobility devices such as wheelchairs.
- Private hospital rooms: Getting a private room in a hospital often costs extra, and private medical insurance usually has a minimum allowance for private rooms.
- Advanced diagnostic services: If you need to undergo diagnostic scans and tests, private medical insurance can cover anything considered “unnecessary” by public healthcare.
Besides offering additional medical expenses coverage, private medical insurance is also ideal for those who might be excluded from public coverage. For example, if you travel regularly and need medical attention outside Canada’s borders, having a private health insurance plan can save you thousands of dollars in medical expenses. On the other hand, if you stay in Canada but don’t qualify for the public healthcare system, a private health insurer can keep you safe and healthy.
How Does Private Health Insurance Work?
Public health insurance is simple – most of the time, the care provider will bill the provincial government directly. All you need to do is fill in your details and receive care. However, with private health insurance, it can get complicated.
Direct Billing
Private health insurance plans use direct billing. You need to give the healthcare provider all your insurance details, after which they can send a bill to your insurer. Most of the time the care provider will send you a bill as well, however, you can wait for your insurer to process the claim and then check to see if everything’s been covered.
Call ahead
Some insurers require you to call them before making an appointment for a procedure or consultation. This way they can start the claims process early or greenlight certain treatments if it’s particularly expensive.
Customized Plans and Advice
Organizations like Sun Life offer different levels of coverage—Basic, Standard, and Enhanced. These can accommodate you on a low or a high budget, with certain restrictions. The lowest plans often feature just dental and basic medical needs, while the most expensive ones include anything from comprehensive prescription cover to surgery. You can customize your medical cover to find something that aligns with your budget.
Comparing Personal And Provincial Coverage
The above sections have outlined the basics of personal and provincial health insurance in Canada. To understand how they compare, check out the summary table below:
| Features | Private Health Insurance | Public Health Insurance |
|---|---|---|
| Eligibility | Anyone willing to pay for health coverage. | Canadian Residents. |
| Do you need to provide your medical history? (underwriting) | Yes | Unlikely |
| Coverage | Depends on the policy. | Most “necessary” medical care. |
| Tax benefits | Can be claimed on a tax return form if it’s employee-paid. | Not applicable |
How to Choose the Right Health Insurance Plan
There are several steps in picking a private health insurance plan. Along the way, you’ll need to make various decisions about coverage options, your budget, how many members you need to cover, and which care providers you prefer. When picking a health insurer, you need to consider the following:
- Do you or your family have pre-existing conditions? If you have a chronic illness that requires prescription medicine, or if hereditary illnesses run in the family, check to see if the health insurer covers these conditions.
- How comprehensive is the coverage? Some plans offer only basic hospital services, while others cover nearly every healthcare need. The coverage you choose will depend on your available budget, your emergency fund, and your life circumstances.
- Cost vs Benefit. Doing some basic cost and benefit analysis can help you decide whether a cheaper plan is worthwhile, despite having less comprehensive coverage.
- Renewability. As you age, health insurance gets more expensive. Finding a plan that offers long-term renewability can ensure you don’t go uninsured at older ages.
- Hospital network. Most health insurers have a list of hospitals they will cover. Check this list to see which nearby hospitals fall under the plan and whether they are reputable and easily accessible.
- Insurer reputation. Customer reviews will be extremely helpful here. You want to find an insurer that will process your claim easily and offers good customer service.
Finding a good balance between coverage and cost can be tough, but you can rest easy knowing that Canada’s public healthcare system will take care of you for the most common issues. Anything extra care requires a little more consideration, but with several reputable Canadian health insurers to choose from, you’ll have no trouble getting your new braces installed or some extra testing done for your condition. Take Care!
FAQs
Q: What is the typical cost of private health insurance in Canada?
A: The average cost of private health insurance in Canada is approximately $756 per year, or around $63 per month.
Q: Is purchasing health insurance in Canada a worthwhile investment?
A: Yes, purchasing health insurance in Canada is considered a worthwhile investment, especially for those who do not have health benefits through their employer. Health insurance not only has the potential to save money in the long run but also contributes to maintaining good health.
Get the Latest Financial Tips and Trends
Sign Up for Our Newsletter to Master Life Insurance, Investments, and Mortgages
Additional Services
Empower Your Financial Decisions
Book Your Free Consultation to Discuss Your Financial Needs and Goals
Follow Us on Social Media
Join Us Online for Expert Financial Guidance! Follow our social media channels for essential tips and updates on managing personal finances, investments, insurance, and mortgages. Get connected and take control of your financial future!