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Should community-based services be publicly funded or contracted out?

Published online by Cambridge University Press:  06 July 2012

Lynnette Nathalie Lyzwinski
Vancouver Coastal Health Community, Vancouver, British Columbia, Canada
E-mail address:



The introduction of Canada's Medicare in 1966 established precedence for a universally accessible and equitable healthcare system. Although Canada has been a leader in building the foundations of socialized medicine, it has stalled short of fulfilling a vision promulgated by its architects of a system that operates on a continuum of care. The aim of this review was to examine whether the expansion of publicly funded services under the Canada Health Act would be an economically and socially viable policy option.


A literature review of the direct and indirect social and economic costs associated with contracting out community-based services in the form of outpatient rehabilitative care, palliative care, and home care was conducted.


This article concludes that the private financing of community-based services increases healthcare costs in the long term through increased density and frequency of acute care utilization. It is associated with increased indirect costs in the form of caregiver burden and reduced labor market participation of informal caregivers. The expansion of publicly funded community-based services minimizes these direct health and indirect societal costs.

Significance of results:

The integration of publicly funded community-based services under the Canada Health Act would ensure that the principles of Medicare in the form of equity and accessibility would be enforced while maintaining an economically sustainable healthcare system.

Review Articles
Copyright © Cambridge University Press 2012 

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