Good evening, Mr. Chair and committee members. On behalf of the Canadian Institute for Health Information, I'd like to thank you for the opportunity to appear before the Standing Committee on Citizenship and Immigration.
Since 1994, CIHI, the Canadian Institute for Health Information, has been an important organization in Canada's health sector. We are a not-for-profit independent body funded by the federal government and all provinces and territories. Our board of directors is made up of deputy ministers of health and other health system leaders representing all regions of the country and the federal government.
When we were created over two decades ago, we had three databases. Today we have 28, and we have data-sharing agreements with every province and territory, Health Canada, Statistics Canada, and the Public Health Agency. CIHI is a leader in health data, methodologies, and system performance measurement, and we are recognized internationally for our work. Over 20 years we have become the authoritative source on a range of health system topics, including health expenditures.
Our role in the health system is to make data publicly available for people like you, Canada's policy-makers, as well as for the health system, researchers, and the general public. We are neutral and objective in fulfilling our mandate to deliver comparable and actionable information. Our aim is to give people the tools they need to drive improvements in health care, health system performance, and population health. Ultimately we work to improve the health care system and the health of Canadians across the country.
Earlier this month we released our annual report on health spending in Canada. “National Health Expenditure Trends” examines how much is spent on health care each year, where the money comes from, and how the money is spent. For the past 20 years, we've been responsible for reporting on health spending in Canada, continuing work that began 40 years ago with the purpose of supporting the development and evaluation of health programs in Canada.
Our report is based on a classification system that is consistent with international standards developed by the OECD for reporting health expenditures, so the focus of our work is on health system expenditures. Spending in important areas such as social services, including income support for housing, home supports, and home support services, is not included, even though these areas may impact health. Total health spending in Canada includes both public and private sector expenditures. These are further broken down into broad categories such as hospitals, drugs, physicians, and other institutions such as long-term care, nursing homes, and professional services for things like dental and vision care, and so on. We call it NHEX. This report combines readily available information from public accounts, annual reports, main estimates, Statistics Canada, and private health insurance. This information is used to produce estimates for the current year.
Current year estimates are revised to actual expenditures once they are confirmed, typically with a one- to two-year lag. It's just one example of how publicly available data is used by government officials, provinces, and territories, and other third party organizations, all with the common goal of improving the health of Canadians.
Canada's health spending is forecast to grow almost 4% this year to $242 billion. This is a slight increase in the rate of health spending growth. We've seen an average growth rate of about 3% since 2010. Health spending is forecast to be $6,604 per Canadian. This is almost $200 more than last year.
Total health expenditure per person is expected to vary across the country from $7,378 in Newfoundland and Labrador and $7,329 in Alberta to $6,367 in Ontario and $6,321 in British Columbia. This variation across the country occurs for many reasons, including differences in population demographics and health status, prescribing practices, public program design, and other factors.
The results of this report are also used to compare Canada with other OECD countries. In 2015, which is the latest year for which we have actual expenditure data, Canada's per-person spending was among the highest internationally at $5,782 CAD, which is a figure comparable to those for the Netherlands, France, and Australia, but much lower than that of the U.S. at $11,916.
Hospitals, drugs, and physician services are the categories that continue to use the largest share of health dollars. Over time, the share allocated to hospitals has been decreasing and the share allocated to drug spending has increased. In 2017 spending on drugs is expected to grow at an estimated 5%, spending on hospitals at about 3%, and spending on physicians at about 4%.
We've identified several major cost drivers, including inflation, population growth, and the aging population. Population growth and aging account for 2% of total health spending growth per year. Over the last several years, we have found that population aging, in particular, is a modest but steady cost driver, about 1% per year.
In closing, I'd also note that we have a new strategic plan for the years 2016-21, identifying strategic goals that build on our core strengths as an organization and that focus on priority populations, including seniors, children and youth, indigenous people, and those living with mental illness and addictions. Along with our stakeholders, including the federal government and the provinces and territories, we identified these priority populations.
I thank you for the opportunity to present this information. My colleague Chris Kuchciak and I would be pleased to answer any questions you may have.