1. 1 Health Care Cost Drivers: Hospital and Other Health Expenditures—Descriptive Overview April 28, 2011

2. Overview What are the growth trends in health spending categories other than hospitals, physicians and drugs? What are some of the key trends in public-sector spending on long-term care? How have capital investments in buildings and equipment affected overall spending? What are the key issues to watch in the future? 2

3. Overview of Other Health Expenditures 3

4. Rising Share of Other Health Expenditures During the 1990s 4

5. Long-Term Care, Public Health and Capital Are Significant Categories of Other Health Spending 5 Distribution of Other Health Expenditures by Category, 2010 f Public Sector: $46.5 Billion Health Research $2.3; 5%

6. Public Health, Capital and Long-Term Care Are Mainly Financed by the Public Sector 6 Public-Sector Share of Categories

7. Capital, Health Research and Public Health: The Fastest-Growing Categories 7

8. Increased Spending on Public Health 8 Public Health Expenditure as a Percentage of Total Public-Sector Spending

9. 9 Public-Sector Administration Expenditures as a Percentage of Total Share of Public-Sector Administration Spending Relatively Unchanged in the Past Five Years

10. Growth in Spending on Other Health Professionals Higher in the Private Sector 10 1.7% 5.6%

11. More Health Professionals 11 2004 2008 Percentage Change Percentage Population Increase Number of Physicians 60,61265,440 8.0% 4.2% Number of Regulated Nurses 315,135341,431 8.3% Number of Dentists and Dental Hygienists 35,86641,798 16.5% Number of Optometrists 3,9414,507 14.4%

12. Public-Sector Spending Trends in Long-Term Care 12

13. The Structure of the 65+ Population Has Shifted Toward Older Seniors 13

14. Public-Sector Expenditures on Long-Term Care as a Percentage of Total 14 Long-Term Care Does Not Account for Increasing Share of Public-Sector Health Expenditure

15. Growth Rates in Long-Term Care Institution Spending per Capita for the Oldest Senior Age Groups Among the Lowest 15

16. Population Aging: Greater Effect in Long-Term Care Institutions 16

17. Beds Staffed and in Operation per 1,000 Seniors Relatively Unchanged 17

18. Average Annual Growth Rate in Number of Beds in Long-Term Care Institutions per 1,000 Seniors Varied in Selected G7 Countries 18

19. Compensation Unchanged, Number of Full-Time Equivalents Increasing 19

20. An Increase of More Than $1 Billion in Home Care Spending 20

21. Government-Sponsored Home Care Users Rising 21 Government-Sponsored Home Care Users per 1,000 Population

22. Higher Proportion of Residents 85+ in Homes for the Aged 22

23. Rising Proportion of Residents in Homes for the Aged Receiving Type III and Higher Care 23

24. Alternate Level of Care Is an Important Issue In 2008–2009, there were more than 92,000 hospitalizations and more than 2.4 million hospital days involving alternate level of care stays in Canada. This represented 5% of all hospitalizations and 13% of all hospital days. There is a perception that a growing proportion of elderly patients tie up hospital beds while waiting for a place in long-term care. 24

25. Overview of Capital Expenditures 25

26. Share of Public-Sector Spending on Capital Trended Upwards in the Last Decade 26 Capital to Total

27. 27 Distribution of Total Capital Expenditures

28. Capital Expenditure in Health Care Capital investment by type of asset 1)Construction: facilities and building construction 2)Equipment 28 Annual Capital Investment by Type of Asset, 1998 to 2008 Type of Asset Value ($ Billions) AAG 1998–2008 1998(% of Total)2008(% of Total) Equipment 1.253.5%3.036.3%9.3% Construction 1.146.5%5.263.7%17.2% Total 2.3100%8.2100%13.6%

29. Increasing Share of Capital Spending for Residential Care Facilities 29

30. Overall Key Findings Long-term care does not account for an increasing share of health spending in the public sector The number of full-time equivalent (FTE) personnel (not wages per FTE) is mainly responsible for the increase in institutional care spending From 2004 to 2008, trends in beds staffed and in operation kept pace with demographics Capital investment in the health care sector significantly increased from 1998 to 2008; the trend was led mostly by long-term care institutions 30

31. Key Issues to Watch in the Future What is the best way to provide care for seniors? –What will be the balance between hospital care, institutional care and home care during the next decade? –How will the system optimize the integration of seniors’ care? How will provincial deficits and fiscal restraint in future years affect investment in public health and capital? 31

32. 32 Thank You