Canada is, in many respects, culturally and economically similar to the United States, and until relatively recently, the two countries had similar health systems. However, since passage of the Canada Health Act in the 1970s, that nation's health statistics have become increasingly superior. Although the costs of Canada's health system are high by international standards, they are much lower than U.S. costs. This paper describes several factors likely to be responsible for Canada's better health at lower cost: universal financial coverage through a so-called single payer; features conducive to a strong primary care infrastructure; and provincial autonomy under general principles set by national law.