Two-tier health care is a form of national health care system that is used in most developed countries. It is a system in which a guaranteed public health care system exists, but where a private system operates in parallel. The private system has the benefit of shorter waiting times and more luxurious treatment, but costs far more than the public one for patients. Thus there are two tiers of health care, one for the public at large and another for those who are wealthy enough to pay for better care.

The term is most often used in Canadian health discussions where the debate over two-tier health care has long been central. Moving to a two tier system is supported by conservative think tanks such as the Fraser Institute. The potential for vast profits has created a strong lobby in the health industry, which is today confined to the periphery. As it stands now, Canada does not have a parallel system, free market health care for Canadians being almost wholly banned in fields covered by the national health system; some private clinics and hospitals which were operating when the national health care plan was instituted (for example, the Shouldice Hospital in Thornhill, Ontario) continue to operate, although they may not bill additional charges for medical procedures. Private health care may also be supplied in uncovered fields and to foreigners.

The phrase is also sometimes used in other countries and among health care experts. In Europe it often has the same meaning as in the Canadian context, but is used there used to describe the status quo. However, sometimes it has a somewhat different meaning relating to the expansion of private sector involvement through voucher programs or other initiatives.

The proponents of two-tier system argue that it would introduce more flexibility into the system, reducing wait lists and that competition from the private sector would make the public one more efficient. Opponents argue that a two-tier system would tend to draw many of the best doctors out of the public system, reducing the overall level of care. The Canada Health Act is also committed not only access to health care to all, but access to the best health care available for all. Many on the left consider access to the best possible care an important right of all citizens. Competition from the private sector would also almost certainly drive up the wages of doctors and other medical professionals in the entire system. Those who support a wholly public system also say that there is some concern that if Canada would allow a parallel private system within the country, it would be opening itself up to trade sanctions under some of its trading agreements.

Many two-tier systems do attempt to resolve these difficulties. Australia, for instance, requires all doctors to work some of their time in the public system. However, if care is not superior in the private system no one would use it so a certain imbalance between the care received by the rich and the poor exists in all two-tier systems.

In any case, because of these issues, the Canadian people are overwhelmingly opposed to the notion of two-tier health care. In fact, some argue that Canada already does have a two-tier health care system as the very wealthy can go to the United States for treatment, and quite a few Canadians do each year.

It should be noted that all advanced countries have two-tier health care in the world to varying degrees except for Canada.

See also: Canadian and American health care systems compared, health care system