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This work stems from a brief visit in 1993 to the Canadian health services as part of the PAHO International Health Training Program and the subsequent research, discussion, and analysis relating to that experience. By no means is this paper an exhaustive account of the system, but rather a close look at one of its aspects: financing. The main objective is to identify some of the virtues and limitations of a health system that is considered one of the most efficient, effective, and equitable in the world. Although the Canadian health system is financed by the federal government and the provincial governments, cost containment is a constant concern, since factors such as the growing use of highly complex technologies, hospital care, and long-term treatment of chronic and degenerative illnesses tend to increase costs. The progressive reduction in the federal budget has lead to more efficient use of resources and the rationalization of installed capacity. At the same time, the relative simplicity of the system's operation has permitted administrative costs to be kept low. In addition, alternative forms of care, such as local centers for community-based care, care at home and in special institutions to promote the maximum level of self-sufficiency, and the use of volunteers, have been devised in order to partially control cost increases. The people's participation in planning and decision-making permit them to guide the development of the health services. Nevertheless, given the current situations, it is essential that the system be modified to prepare it for the challenges the twenty-first century will bring.