Standard & Poor’s is warning that Canada and other G20 countries could face credit downgrades if they don’t control expected increases in health-care costs as the average age of their population rises.
“Steadily rising health-care spending will pull heavily on public purse strings in the coming decades.”
“If governments do not change their social protection systems, they will likely become unsustainable,” it says.
The report says possible reforms include adopting technology that reduces the costs of providing care, controlling prescription costs and abuse of health-care systems, increasing the role of private sector health care providers and reducing coverage.
It is expected that age-related costs — pensions, health care, unemployment insurance and long-term care — would push Canada’s net debt to grow by 260 per cent by 2050.
S&P forecasts that health-care spending as a share of total age-related spending in Canada would increase by more than 70 per cent by 2050.
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