In November of 1970 a major change in public health policy occurred in Quebec: the movement from a mixed private-public system to a completely public system of financing health care (known as Medicare). This policy change had important economic effects on the distribution of income, taxation, and health care costs. This paper analyzes these economic effects by focusing on the changes in financial burden of medical care costs between 1969–70 and 1971–72 for eight income classes. The key results that emerge are: the total cost of medical care increases sharply for all of the income groups, and the burden of the cost of medical care becomes more equitable across the income groups. Based on these results, policy considerations for the present debate on national health insurance in the United States are offered.