Most of the health care costs in Canada are covered by Medicare, Canada’s publicly funded health care system. However, there’s no single national plan. Instead, we have 13 provincial and territorial health care insurance plans which interact with each other to provide a nation-wide service.
Under Medicare, Canadian residents have access to the majority of medically-necessary hospital and physician services without paying out-of-pocket. However, there are certain treatments and services that are not covered by Medicare. Even though you may have employee or retiree benefits that provide extra coverage, there may occasionally be expenses that you have to pay for yourself.
While many Canadians don’t have trouble paying those extra medical bills, some drugs and costs of specialized treatments that are not covered by Medicare can begin to take a toll on finances. We’ll discuss ways to find out what costs are not covered by Canada’s health care system and discover which types of loans are available to help cover your medical expenses.
The following services are usually covered by public health care in Canada:
Doctors and specialist appointments
Medically necessary hospital stays
Prescription drugs while in hospital
Treatment of illnesses
What services are not covered by health care in Canada?
Procedures, treatments and services are administered through each provincial or territorial health care system, and what’s covered (and not covered) varies across the country. However, some services such as routine dental care and eye care, and specialized services such as chiropractic treatments, are usually not covered by the public health system anywhere in Canada.
You usually have to pay at your doctor’s office if you need a medical examination requested by an employer for insurance purposes, or if you’re asking the doctor for a certificate that you’re too ill to work. Also, you may need to pay for ambulance rides, special equipment or medication, unless there are exceptional circumstances such as a diagnosis with a life-threatening condition.
Given the many differences in coverage, it’s a good idea to check out your provincial or territorial health care plan:
What types of financing are available to cover extra medical expenses?
If the public health care system or your private insurance don’t meet your needs, you have a variety of different options available to you when looking to cover special medical expenses. These are a few of the many options you can explore:
Medical financing. Some private loan companies provide financing to cover the cost of medical procedures and products. If approved, these companies will pay for your medical expenses upfront, so you can get the treatment you need. Then, you’ll repay the company with interest over a period of time usually ranging from 6 months to 5 years. Interest rates are comparable with the average rates charged for personal loans.
Credit card. Since medical bills in Canada don’t usually become too costly, using your credit card to pay for prescription medications, dental work and ambulance rides can be a good way to pay for your treatments. If you’re constantly paying for bills on your credit card, you may want to look for a rewards card that offers points per dollar spent or a low interest rate credit card.
Short-term loan. If you need to cover some unexpected medical bills, you may look into getting a payday loan. These types of loans allow you to borrow money usually for seven to 31 days. Although easy to get approved for and convenient, these loans have notoriously high interest rates.
Unsecured personal loan. You can usually use an unsecured personal loan for any legitimate purpose, including paying for medical expenses. There are plenty of lenders out there that offer unsecured personal loans to cover any income or credit score. You may be able to borrow between $500 to $35,000, or sometimes higher. Interest rates will likely vary between 4.5%-36% and loan terms usually last between 6 months to 5 years.
Secured personal loan. A secured personal loan provides similar borrowing amounts and loan terms to an unsecured personal loan, however you will be required to secure the loan with collateral, such as your car or home equity. Since you’re providing collateral, you will usually be able to secure a more competitive interest rate, however you also risk losing your car or home if you don’t make your loan repayments.
Line of credit. A line of credit can cover a variety of medical expenses, especially if you need to borrow money on and off throughout the year. You only pay interest on what you borrow, and once you repay, you can borrow again for as long as your line of credit is active. You can also borrow up to you limit, which is usually anywhere from $500 to $20,000, or higher.
Home equity loan (HELOC). Your home will likely have equity you can draw on if you need a larger loan. These are secure loans and lines of credit that use your home as collateral. They have lower interest rates than unsecured loans, but you do risk losing your home if you’re unable to repay. This type of loan would only be necessary if you run into some seriously expensive medical bills, and you should explore all other options first.
Compare personal loans to help cover medical expenses
Representative example: Shelley has hospital bills
Shelley broke her leg while ice skating in her backyard. Nobody was home at the time, so she had to call an ambulance to take her to the local hospital. On arrival, she discovered that she would have to pay for the ambulance, as well as crutches and any medication she required. Her ambulance bill came to $240.00, while her crutches cost $45.00 and her medications totalled a whopping $65.00 – a total of $350.00. Without insurance, she had to cover the costs herself. What’s more, Shelley wouldn’t be able to go to her job as a waitress, which means she wouldn’t have as much money coming in. She realized she would need to take out a loan to cover her hospital bills, as well as a little extra to cover the cost of groceries and bills for at least two weeks. Since she wasn’t mobile, Shelley headed online and applied for a $1,000 personal loan with an online lender.
Cost of hospital bills
Interest rate (APR)
Origination fee of 3% ($30.00)
Total loan cost
*The information in this example, including rates, fees and terms, is provided as a representative transaction. The actual cost of the product may vary depending on the retailer, the product specs and other factors.
What factors should I consider when comparing loans?
When comparing your loan options, you should take the following factors into account:
Application process. If you need a loan quickly, you will want to compare lenders who have easy and fast application processes. Many lenders will provide online applications that usually take less than ten minutes to complete.
Credit score requirements. Lenders should list the minimum credit score necessary for approval. If you don’t meet the requirement, don’t apply for the loan – you’ll likely slightly damage your credit score since the lender will do a hard pull on your credit file.
Loan amount. Make sure the lender offers the amount you need. Some lenders will have minimum and maximum amounts you can borrow. Remember to only borrow exactly what you need since you will be paying interest on the money you borrow.
Interest rate. Lenders calculate your interest based on your credit score, income and debt-to-income ratio. If you have bad or fair credit, finding the lowest rate should be at the top of your priority list. You don’t want to spend hundreds or thousands more than you have to because of interest.
Fees. Depending on the lender you choose, you may have to a pay an administrative fee or a monthly fee. These can greatly impact the overall price of your loan. In addition, you should also know what fees are charged if you’re late for a payment or if you want to make early repayments.
Loan term. How long you have to repay the loan will impact your monthly payments and the total cost of your loan. A longer term means lower payments, but more spent on interest. Choose a loan term that doesn’t break your budget but won’t cost you too much in interest.
What are the eligibility requirements?
In order to apply for a loan, you will usually need to meet some basic eligibility requirements. These will vary by lender, however they usually include:
Be 18 years of age, or the age of majority in your province or territory
Be a Canadian citizen or a permanent resident with a valid Canadian address
Have a working bank account
Have proof of a steady income
You may need to meet a certain credit score
You may have to meet minimum income requirements
What information will I need to provide?
In order to apply for a loan, lenders will request that you supply information about yourself and your income in order to determine if you meet the eligibility criteria. You will usually need to provide the following:
Personal information. Your name, date of birth, address, contact information and Social Insurance Number (SIN).
Employment information. Your employer’s name and contact information, how long you’ve been employed and your income.
Bank account information. Your bank’s name and transit number and your personal account number. This is only required for loans that will be deposited directly into your bank account.
If you plan on using your loan to consolidate your debt, you may need to provide information about these accounts so the lender can send funds to pay off your accounts for you.
What if I don’t want to take out a loan?
Not everyone has the extra income to spend on making loan payments, and people with poor credit will likely find the interest they’re being charged too much to handle. Instead, consider some of these options:
Your age. Depending on the province you reside in and your age, you may be eligible for free coverage of some of the medical services that are not covered elsewhere. In Ontario, for example, as of August 2018, prescription medications are free to everyone under the age of 25.
Request a payment plan. If you receive a medical bill that you are unable to cover, you may be able to work out a payment plan with the hospital, dentist, chiropractor or specialist who treats you. Let them know about your financial situation and see if they are willing to work out a scheduled repayment plan with you.
Get private insurance. If you find yourself constantly paying for uncovered medical expenses, you might consider looking into private insurance. This type of coverage can set you back a few hundred dollars each year, however it can save you a lot in the long run if you find yourself constantly on prescription medication or in and out of the dentists office a lot.
If you find yourself constantly paying for uncovered medical bills in Canada, you may need to borrow money to pay off your treatments and services. While loans can help you out in the short term, they can throw you into a spiral of debt. Research your options carefully and know what you’re getting into before you sign on the dotted line.
Frequently asked questions
Interest rates vary depending on the lender and your credit score. After applying for the loan, you’ll receive a more accurate estimate of the interest rate the lender will charge, which usually ranges anywhere from 4.5% to 36%.
Yes. If you don’t make your repayments on time, the lender may report you to the credit bureaus, which means your score would take a hit. On the flip side, you can actually use a loan to improve your credit score by showing that you can responsibly make your repayments on time.
When you apply for a loan, a lender usually does a hard pull on your credit file to check your score. Your score will take a small negative hit, usually of around 5 points, when this pull occurs.
No, hospital stays in Canada are covered under Medicare.
Kellye Guinan is a writer and editor with Finder and has years of experience in academic writing and research. Between her passion for books and her love of language, she works on creating stories and volunteering her time on worthy causes. She lives in the woods and likes to find new bug friends in between reading just a little too much nonfiction.
Learn whether in-house financing is a good choice for you and find out what your alternatives are if you’d prefer a different type of car loan.
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