Government Insurance in Canada

• The presentation covers government insurance in Canada, including healthcare, disability insurance, unemployment insurance, Canadian Pension Plan, and worker's compensation.

Healthcare System in Canada

• Aims to prevent medical expenses from causing poverty or fatal situations.
• Operated with a publicly tax-funded system called Medicare
• Most medical expenses are covered
• The federal government is responsible for financial funding and standards
• Each of the 13 provinces/territories have their own insurance plans, rules, and regulations.

Canada Health Act

• Principles include public administration, comprehensiveness, universality, portability, and accessibility.
• Provincial plans must be operated by a non-profit authority ensuring transparency in public administration.
• Each province/territory must cover all medically necessary services
• The full cost must be covered by the provincial plan under comprehensiveness.
• Universality: All qualifying residents receive coverage for their expenses.
• Portability ensures coverage for residents traveling within Canada; original province insurance is valid for three months after moving.
• Accessibility upholds the principle that healthcare is based on medical need and fairness.

Supplemental Coverage

• Seniors, children, and those needing social assistance may receive supplemental coverages like dental, vision, prescription, and ambulance from the 13 provinces/territories.
• Those who don't qualify for such coverage rely on insurance companies or pay out-of-pocket.
• The federal government provides healthcare to First Nations, Inuit, Canadian Veterans, and Inmates.

Issues with Canadian Healthcare

• Significant waiting periods exist for non-emergency services, causing patient distress.
• Fraud impacts the system's efficiency and accessibility, resulting in longer wait times and costing millions of tax payer dollars.
• Fraud can occur through billing, insurance claims, and prescriptions.
• The publicly funded healthcare system faces sustainability issues.
• A key driver is Canada's aging population
• Meeting care demands requires adjustments in funding and resources.
• In 2024, the total healthcare expenditure was forecasted to be $372 billion and is expected to grow faster than the overall economy

Privatized Healthcare

• A two-tier system with public healthcare alongside private options
• Wealthier individuals can pay for faster access
• Cons are the ethical challenge of undermining the core values of Canadian healthcare
• Pros are reduced wait times and increased efficiency

Canada's Healthcare vs USA

• Canada has little to no direct costs for medically necessary treatments and Canadians pay higher taxes to fund healthcare
• USA average annual premiums are $8,435 for individuals and $23,968 for families
• Most Canadian citizens have access regardless of income, but newcomers may face coverage challenges
• USA as of April 2023, 25.3 million individuals are uninsured and accessibility relies on employee benefits or financial strength
• Canada has longer waiting periods with a median of 30 weeks for a general practitioner whereas the USA average waiting periods are approximately 3 weeks

Takeaways

• Canada prioritizes equity, which results in longer waiting periods
• The US prioritizes efficiency, leaving those who cannot afford it with debt or illness
• Both systems face morality and sustainability flaws reflecting how each operate.

Disability Insurance

• Protects individuals and families from unexpected accidents, injuries, or illnesses
• Individuals can receive disability insurance through government-sponsored programs or private insurance
• Many employers offer disability insurance
• Categories include total vs partial disability
• Disability definitions can vary between companies, even within the same company's plans

Government Disability Insurance Programs

• Canada Pension Plan Disability (CPP-D) provides monthly assistance to those who have contributed to the CPP.
• To be eligible for CPP-D, must be under 65 years old and have a severe and prolonged disability
• The disability amount is determined by length and amount of contributions to CPP.
• New beneficiaries receive an average amount of $1538.67 (GOC, 2025).
• Employment Insurance Sickness Benefits offer short-term financial relief, and requires the individual to have accumulated 600 insurable work hours in the last 52 weeks to receive benefits for up to 26 weeks.
• Provincial Disability Support Programs, such as Ontario Disability Support Program (ODSP)), serve those who don't qualify for federal programs.
• Provincial programs are designed for people who do not qualify for federal programs and require residents to be 18+, a Canadian Citizen or Permanent Resident, and a physical or mental disability that is expected to last for a year or more.

Private Disability Insurance

• Private insurance is offered through Canada Life, Blue Cross, Sun Life, and more
• Private insurance has Short Term and Long Term Disability Insurance sub-categories
• Short Term Disability Insurance lasts up to 6 months
• Short Term Disability Insurance only covers temporary disabilities and is used for injuries, surgeries, or short term illnesses
• Long Term Disability Insurance begins after short-term disability benefits expire
• Long Term Disability Insurance can last for years or even until retirement and covers about 60-70% of a person's disability income

Private Insurance (continued)

• Individual Disability Insurance is for self-employed individuals or those without workplace benefits, offering more flexibility in coverage amount.
• Cost of insurance relies on health, age, occupation, and the amount of coverage needed.
• Group Insurance is often provided by employers or unions
• Premiums are usually partly of fully paid by the employer Most group insurance plans offer disability coverage and are more affordable than individual plans

Employment Insurance (EI)

• EI (formerly Unemployment Insurance) is a government program, administered by Service Canada under the Employment and Social Development Canada (ESDC), that helps workers secure temporary financial assistance upon becoming unemployed.
• EI helps those who lost their jobs through no fault of their own as they search for a new job.

EI Eligibility

• To qualify for EI, individuals must actively look for work and be willing to accept employment, have enough insurable hours in the past 52 weeks, have worked in insurable employment, and contributed to EI.
• They must have lost your job through no fault of your own, for example layoffs or company closure
• Individuals are not eligible if they quit without just cause or were dismissed for misconduct.

Types of EI Benefits

• Regular Benefits: For individuals who lost their jobs through no fault of their own and are actively searching for new employment
• Sickness Benefits: Provides up to 26 weeks of financial assistance for individuals who cannot work because of a serious illness, injury, or quarantine
• Maternity & Parental Benefits: Expecting or new parents can receive up to 61 weeks of EI benefits to bond with and care for their newborn or adopted child without financial stress
• Caregiver Benefits: Individuals who need to care for a critically ill or injured family member can receive up to 26 weeks of financial assistance
• Work Sharing Benefits: Instead of laying off employees during an economic downturn, businesses can reduce work hours, and EI will compensate employees for lost wages

EI Payments

• EI payments cover 55% of average weekly earnings, up to a maximum of $668 per week, based on insurable hours worked in the past 52 weeks.
• EI benefits last between 14 to 45 weeks, with extensions granted during economic downturns.

EI Application

• Individuals can apply online through Service Canada (within 4 weeks of becoming unemployed) and submit a Record of Employment (ROE) from the employer
• The documentation needed is: Social Insurance Number, work history & last pay stubs, and direct deposit banking details

EI Abuse During COVID-19 in Canada

• Increased fraud cases occurred, including individuals claiming EI while still working or providing false information about job loss.
• Many individuals received double payments from CERB and EI.
• Some claimants collected benefits without actively looking for work
• The CRA and Service Canada investigated cases, requiring ineligible recipients to repay benefits.

Canadian Pension Plan (CPP)

• Established in 1965, CPP is a government-managed pension plan that provides financial support for Canadians in retirement, disability, or upon death of a contributor.
• Mandatory contributions are deducted from employees as well as employers, even self-employed individuals
• Benefit amount depends on how much and for how long you contributed during your career.
• You can start collecting CPP benefits as early as 60, or delay until 70 for higher benefits.

Pros and Cons of CPP

• Pros are Universal Coverage meaning the CPP is available to working Canadians, whatever the occupation or income
• Social Safety Net: Supports workers without private pension plans or savings.
• Inflation Protection: Benefits are adjusted for inflation to preserve purchasing power.
• Spousal and Survivorship Benefits are given to family members in case of disability or death.
• Cons are Limited Benefit Amount : May not replace enough of pre-retirement income with a maximum monthly benefit in 2024 of $1,306.
• High Contributions for Some: Self-employed individuals pay full contribution (11.9%).
• Dependence on Economic Health: Funding relies on the current workforce's contributions, vulnerable in economic downturns.
• Not Designed for Everyone: Gaps in contributions (e.g., caregiving periods) will decrease benefits.

Workers' Compensation

• A form of insurance providing wage replacement and medical benefits.
• Paid by employers and is independent from government, registered through WSIB
• Operates as a no-fault system

Common Claims

• The most common claims are slips & falls, severe cuts & lacerations, overuse, workplace violence, burns, and machinery incidents

Guiding Principles of Worker's Compensation

• There are 4 key principles of Worker's Compensation
• Employers pay direct cost
• Workers sacrifice right to sue
• Negligence not considered
• Neutral system.

Important Items

• Workplace incidents must be reported within 72 hours (varies)
• Avoid using sick days for workplace injuries
• There is a maximum amount for an employee's earnings to remain insurable
• Always provide accurate and sufficient evidence.

Examples of Exempt Industries

• Common examples are Industries include dentistry, banking, and insurance
• It is important to note, it does not mean they cannot receive compensation
• There is no mandatory obligation to pay for it