Here is an explanation from Wiki, in basic form:
Health care in Canada - Wikipedia, the free encyclopediaHealth care in Canada is delivered through a publicly-funded health care system, which is mostly free at the point of use and has most services provided by private entities. It is guided by the provisions of the Canada Health Act. The government assures the quality of care through federal standards. The government does not participate in day-to-day care or collect any information about an individual's health, which remains confidential between a person and his or her physician. Canada's provincially-based Medicare systems are cost-effective partly because of their administrative simplicity. In each province each doctor handles the insurance claim against the provincial insurer.