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Many people are curious about the pros and cons of the American and Canadian healthcare systems. These are my thoughts after approximately 3 years living in Canada. I claim no expertise other than my personal experience. For context, in the US, we were on a private HMO plan, as state employees. In Canada, we are on the Nova Scotia provincial plan. I have no experience with health plans in other provinces, but one nice things about Nova Scotia’s is that coverage starts right away. My understanding is that some other provinces have waiting periods.

In the US

The Pros:

Unlike many people in the US, we had excellent health insurance that was very, very cheap. For ~12 years, we both worked at a large, state university. As state employees, we had fantastic health insurance and, because we were BOTH state employees, we paid almost nothing for it. At the time, in the state of Florida, married couples who both worked for the state paid just $30 per month ($15 each) for family coverage. In other words, we were in an extremely good insurance situation in the US. With insurance, we paid $20 per appointment for general physicians, and $40 per appointment for specialists.

We were also happy with the providers we had access to. We had a pediatrician that we really liked and were typically able to get in the same or next day for illnesses. We’d use after hours clinics, where we might wait an hour or two maximum, to fill in the gaps. We had an extremely positive childbirth experience at the big hospital where they were very supportive of natural birth and it cost us $250 out of pocket. We had a large medical clinic on campus where both my wife and I went for our primary care. It was easy to get primary care appointments, although if we wanted something same or next day we might see a different doctor. Specialist appointments could take a long time — I waited 4 or 5 months to see a hematologist at one point. Prescriptions were well covered (by US standards). My asthma medicine cost $60 for 180 doses, with a list price of ~$600.

The Cons:

We didn’t really have any mental health coverage, aside from 3 free meetings covered by our EAP program. Dental insurance was separate from our health insurance, and was quite expensive. It was also complicated, and changed every year, so we were often changing between programs and, as a result, changing our dentists. We typically paid between $75 and $110 per month for a family plan, plus another $20-$50 per visit. My teeth are kind of a mess, so I had all sorts of extra treatments. We never really found a dentist that we liked — they were fine, but my wife had a terrible experience getting her wisdom teeth extracted and figuring out an overlap between our dental insurance and our health insurance (for an oral surgeon) was a real pain.

The biggest con, though, was the fact that our wonderful health insurance situation was entirely depended on both of us keeping our jobs with the state of Florida. If we were to lose or change our jobs, we’d lose these benefits. And the people we knew that were not working for the state had VERY different health insurance experiences. We didn’t know it was going to happen at the time, but since leaving Florida our department was shut down and both of our jobs went away. If we had stayed, could we have found other jobs within the university? Perhaps, but not necessarily.

In Canada

The Cons:

I’m going to start with the cons. Again, this is based solely on our personal experience and (as expressed above) we were coming from a very good (albeit job-dependent) situation in Florida. Thus, by comparison, our situation in Canada has felt significantly worse.

The big problem is access. None of us have a family doctor. We have been on the waiting list for almost 3 years. I understand that COVID slowed things down, but this is clearly not a functional system.

So what do we do if we need care? We have a few options:

• Afterhours clinics — There are a couple near us and they all require appointments. To get an appointment, you have to call repeatedly during the first 30 minutes that they’re open and hope you get in before the appointments fill up. It isn’t great, but we’ve typically gotten in.
• Maple – Also, for the last year or so we’ve had access to free virtual care through Maple. Again, getting into it is challenging. As free customers, we can’t schedule appointments, and the queue is often full. Since I work from home, it’s easy for me to try repeatedly, but that isn’t a good option for lots of people.
• Emergency Room – There’s a hospital right in town. I’ve used the ER a couple of times, as have my wife and daughter, and it has been pretty good. Usually, we’ve gotten in and our fairly quickly (under 2 hours). At the same time, there was at least one time when I took my daughter and we left after 2 hours because it was simply going to be too long of a wait.
• Dial-a-Nurse – We have a dial-a-nurse program that is free and is fine if you just need advice, but they can’t treat anything.

The Pros:

There’s a saying I’ve heard here in Canada — “the healthcare is great, you just can’t get it” and that jibes with my experience. Aside from the access issue, everything has been good. I’ve gotten a number of referrals from Maple, and while some have taken a while to schedule, the quality of care has been great. Every doctor and nurse I’ve met with has been knowledgeable and professional, and my appointments haven’t felt rushed. And everything has been 100% covered by my taxes (aka “free”) which, even after 3 years, still feels strange. I always feel when I leave like someone is going to run out after me and ask me to pay.

I have supplemental health insurance through my job which costs me nothing. I could probably get a similar family plan if I were unemployed for ~$200 CAD per month, but it doesn’t feel essential. My insurance covers 80% of PT or mental health up to $500 CAD per year, per member of my family. That gets me ~4 or 5 sessions, depending on the provider. Similarly, it covers 80% of dental, up to a max of $1000 per person, per year. Plus, Nova Scotia has a children’s oral health program that covers basic dental work for kids up to age 14, so we don’t pay anything for our daughter. We have a dentist in town that we really like but, again, getting an appointment can take a while.

Before we moved, I was nervous about prescriptions. I knew they were not covered by provincial health insurance, so I stockpiled some of my asthma medicine before the move. That has totally turned out to be a non-issue. In the US, I would pay $60 (with insurance) for 180 doses. The list price of this medicine was over $600 USD. In Canada, I get the same medicine for $13 CAD (with insurance) for 200 doses. Without insurance, it will cost me $50 CAD. It’s the same exact medicine from the same brand. Seems crazy.

One last thing I like about Canada — it’s much less of an interventionist culture. Some of that is undoubtedly tied to the lack of access, but I think it also has to do with incentives. I don’t think doctors here are incentivized in the same way to schedule follow-up appointments or tests. And, personally, I’m pro-minimal-intervention in healthcare, so I’m happy with that approach.

In Conclusion

Our experience in the US was much better in terms of access, and similar in terms of cost, but that is a very atypical experience in the US. Plus, it was dependent on both of us keeping our jobs, and needing insurance certainly adds a layer of complexity to early retirement.

In Canada, the quality of care has been excellent, and the cost has been negligible, but getting access has been a real challenge. One thing that we’re interested in exploring further is some of the private options that may be coming. Coming from the US, if we could pay $50-$100 per month to have better access to healthcare, I think we’d be open to that.

Ultimately, I’d say we’re still undecided about our opinion of the Canadian healthcare system. We haven’t needed it for anything serious, and (despite the access challenges) we’ve been able to get it when necessary. Plus, we really like the fact that we can count on it being there even if our work situations change.

(One last note that doesn’t really fit in here but that I wanted to mention — I lived in Taiwan for 5 years, and found their healthcare system to be really great. It took some time to find good providers as some weren’t up to the standards I was used to, but once I did, both the cost and the access was excellent. Years later, my wife took some public health courses and Taiwan was often held up as a success story in terms of universal healthcare. Based on my experience, I can totally see why.)

What about you? If you’ve lived in both the US and Canada, what has your experience with healthcare been?

We really like the CBC Gem app. It’s free, and many of the shows have few (or no) advertisements. We stream it from our phones to our TV via a Chromestick. The streaming itself is excellent, and the app is pretty good. My main complaint is that it would be nice to be able to save a list of future shows to watch. Also, the app periodically will sign us out for no reason, but that’s a minor inconvenience.

Periodically, I’ll share some of what we’re watching. For better or worse, I tend to be pretty judgemental about pretty much everything, so I’m kind of hard to please when it comes to media. As a couple, we tend to like things that are “good hearted” — we don’t really watch anything scary or violent or based on people behaving badly. Here are the few of the things we’ve enjoyed watching recently.

Upright – Honestly, I think this might be one of my favorite shows of all time. It tells the story of a down-on-his-luck musician and a teenage runaway as they transport a piano across the Australia. Very well-written and well-acted, and unlike anything I’d ever seen. My wife and I both really enjoyed it. The pacing is excellent in terms of how you gradually learn about the characters. We both cried in the last episode (which, for me, is very unusual). In the US, I *think* it’s available on Amazon Prime.

The Misadventures of Romesh Ranganathan – This is a UK travel show and the premise is that a comedian (Romesh Ranganathan) visits countries with dangerous or otherwise bad reputations. In the first series, he visits Haiti, Ethopia, Albania and the Arctic. The places he visits are interesting, and we really enjoy the tone of the show — he doesn’t make fun of the places he visits, nor does he view them through rose-colored glasses. It’s also been interesting to see some of the conversations around colonialism and racism, particularly with him being a person of color from a former colonial power. Each episode is about an hour long, too, which allows for more depth than some other travel shows (like Travel Man, for example, which is fine but kind of superficial in my opinion and also on CBC Gem).

Ghosts (BBC version) – The premise of this show is simple enough — a couple live in a house haunted by a bunch of ghosts from different time periods. It’s quite funny, and the team behind it is a group of improvisers who basically created the show so that they could all be in something together. It’s gets a little over the top for my tastes at times (there’s a Top Gun inspired montage in one of the later episodes that is pretty cringey) but we still like it. The first two seasons are on Gem.

Hot Docs – There’s a collection of “Hot Docs” that has recently been added to CBC Gem. My sense is that this might be an annual virtual festival, but I’m not sure. We watched Made You Look which tells the story of a long-term art fraud in NYC and found it to be very interesting. I’d like to watch Portrayal as well. Apparently, I’m interested in documentaries about art mysteries. Who knew?

Do you use CBC Gem? And, if so, what are you watching? Are there other free streaming services out there that you like?

When our daughter was born, my wife and I had wills drawn up that used revocable trusts in the event that we both were to pass away. Control of the trusts would pass first to my brother and then to my sister, paralleling the guardianship of our daughter. Our goal is for the assets to follow her to her new family, with no strings attached.

Once we moved to Canada, though, we were told that having a US executors and US trustees would be problematic. At the same time, we didn’t really want to do a full re-working of everything, because our intention is that our daughter (aged 6) would return to the US if we both were to die. Thus, having a US estate plan still makes sense for us.

The solution we’ve arrived at is two-fold. First, we’re continuing to keep our US wills and US estates in place for our US assets (which is the larger share of our assets). Second, for our Canadian assets, we are having wills drawn up that, in the event of both of us passing away, use a trust services company (our bank) to enable my brother or sister to manage our estate remotely. We’ve made it clear to the trust services company that the goal is just to liquidate everything and move it back to the states.

I must confess — I’m no expert on estate planning and I’m not convinced that this is the ideal solution. I’m sure that there are things we could do, for example, to improve the tax efficiency of things. That being said, it meets our needs better than just having a US will, and because our intention (for now) is that our daughter would go back to the States if we both were to die, I think for the time being it makes sense to keep the US will in effect. Once our daughter is older (in say 10 years time) the plan will likely change to one that would keep her in Canada, at which point we’ll re-do everything with that in mind.

One downside to having the US trusts, though, is that Canada requires a tax filing for these trusts every year (even though they are empty). This isn’t a big deal, but it will add a couple of hundred bucks to our tax bill each year. My plan is to start doing our taxes ourselves in the next year or two, so I’m not hugely worried about this. Plus, since our goal right now would be for our daughter to return to the US, it makes sense to keep them even with the additional cost.

Finally, we took a similar approach with our power of attorney documents. If we both were to be incapacitated, we’re using a trust services company as co-attorney with my brother. That way, he can effectively direct things while remaining a US resident.

It was a little tricky to find a lawyer who could handle this. We worked with one lawyer initially, but it was clear that she didn’t really know what she was doing in terms of the crossborder aspects. We ended up with someone, though, that really seems to know her stuff. I don’t have any particular recommendations for trust services companies. I just went with the banks that we have our mortgage and checking account with. When we revisit our wills in 5-10 years, I suspect will get rid of the trust services company in favor of a local friend. If the goal is for our assets and daughter to remain in Canada, though, I could see us continuing to use a trust in some capacity until she reaches a certain age.

If you have any questions about estate planning, please feel free to ask, with the caveat that it’s entirely possible I will not have an answer for you. 🙂 And if you have any experience with your own version of a crossborder estate plan, I’d love to hear it!

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Additional Reading:

Guide to International Estate Planning for Cross Border Families from Creative Planning International

Estate Planning for US Citizens in Canada from RBC Wealth Management

Cross-Border Canadian-U.S. Planning by Ed Northwood

In March 2020, we were planning to come to Nova Scotia to go house-hunting ahead of our anticipated May or June 2020 move. Needless to say, our plans changed. Fortunately, we were still able to find a house (via FaceTime) and ended up moving just a bit later than planned (in July 2020). Because of this, though, we ended up buying a house (and getting a mortgage) without ever having set foot in it. We had visited the town that we settled in for about 4 hours in October of 2019, and that’s it.

It worked out great (we’ve been here 18 months and counting and we love it) but it certainly wasn’t what we’d planned. I’d like to share what I’ve learned about the differences between Canadian and American mortgages. And just to be clear — I’ve had one mortgage in each country, so there are undoubtedly some aspects of mortgages that I’m not familiar with. Please feel free to let me know about other differences, or ask questions, in the comments below.

Amortization Period

The amortization period is the length of time it would take to pay off a mortgage making just the regular payments. For American mortgages, this will be the same as the duration (or term) of the mortgage, but not for Canadian mortgages (more on that below). In the US, the most typical amortization period is 30 years, versus 25 years in Canada. Amortizations periods of 15 or 20 years are also common in the US. I’m not sure how common shorter amortization periods are in Canada, but I may be investigating this our mortgage matures in about 3.5 years.

Term / Duration

The term of a mortgage (Canada only) refers to how long the contract is good for. This contract specifies things like interest rate, prepayment terms, etc. In Canada, this is different from the amortization period. For example, we have a 5-year fixed rate mortgage here in Canada, amortized over 25 years. In other words, we’re locked into the current mortgage contract for the first 5 years, and then we’ll renegotiate when that matures. Typical terms in Canada are 5, 7 or 10 years. The good thing about these short terms is that you can typically get a very low interest rate with a 5-year term. The bad thing (obviously) is that this rate is just guaranteed for 5 years and could go up. We went with the 5-year because we wanted the lower rate and we didn’t want to lock ourselves into anything longer because of the limited prepayment terms.

Prepayment (aka open or closed mortgages)

In my experience in the US, you can typically prepay as much as you want, whenever you want. If you pay more than your required payment each month, it gets applied directly to the principle. And you can pay it off in full whenever you’d like without penalty.

In Canada, on the other hand, many mortgages are “closed”. That means there is a penalty for prepayment before the end of the mortgage term. In other words, if we were to pay our mortgage off before the 5 years is up (remembering that the amortization period is actually 25 years) we’d have to pay a penalty. This penalty is typically a percentage of the remaining interest in the mortgage term, interest that you’d be avoiding by paying it off early. There are also open mortgages that allow prepayment without penalty, but those typically have higher interest rates.

Closed mortgages typically allow some prepayment without penalty (ours allows 10% annually) but you can’t pay the whole thing off whenever you want. If you move before the mortgage matures, you typically wouldn’t have a penalty because the mortgages are portable (meaning you can apply it to your new house) but I imagine you could run into this problem if you left Canada. Our mortgage is closed. Honestly, that made me uncomfortable at first, but the short term and the very low interest rate (2.44%) helped allay my concerns.

Insurance

I’m not sure how typical this is, but our mortgage in Canada does NOT include our homeowners insurance payment. Perhaps there is some behind the scenes communication going on, but it isn’t clear to me how my bank guarantees that I have insurance. We found insurance ourselves, and paid for it ourselves, for the first year. Then we changed companies the second year. I notified the bank of all of this, but they weren’t particularly bothered by it. In the US (at least, in Florida) the bank made our insurance payments (so they knew we had insurance) and even dictated some coverage terms. In Canada, the bank just asked to be listed as the first payee. So our mortgage payment is just principal, interest and taxes in Canada, whereas in the US it has been principal, interest, taxes and insurance.

Conclusion

I don’t have a strong preference for one mortgage situation or the other. I was initially put off by the “closed” nature of Canadian mortgages, but because I’m not a monthly prepayer I don’t really mind. Our plan is to see how things are doing in 3.5 years and possibly pay off our mortgage then. We’ll owe ~$175K Canadian at that point. If the market is up (in other words, if we aren’t in the midst of a correction), I suspect we’ll just pay it off from a combination of our cash on hand, some I-Bonds, and some of our taxable account. On the other hand, if the market is down and the interest rates are low, we’ll probably just get another 5-year mortgage, likely having invested our cash on hand when the market fell. If interest rates are high, though, and the market is down, I think we’ll pay off a chunk, using whatever cash on hand we have (and probably the I-Bonds as well) but leaving our taxable account alone. I love the idea of not having a mortgage in early retirement, but I’m not wedded to it.

Are there any other differences that you’re aware of between Canadian and US mortgages? Are there any questions that you have?