Allan Maslove Headshot

Messing With the Canada Health Act Hurts the Most Vulnerable

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Calls to carve up certain provisions of the Canada Health Act have been cropping up for years. Most recently, a widely circulated report from the Macdonald-Laurier Institute (MLI) advocates for the elimination or relaxing of certain provisions of the Act. Why? To provide the provinces with more discretionary room to reform their health care systems, goes the argument -- one we've heard many times before.

But the truth is that the provinces already have plenty of levers available if they wish to undertake a wide range of health care reforms.

What's less frequently discussed is what we risk losing if certain principles of the Canada Health Act were to be relaxed or abandoned completely.

Specifically, the Macdonald-Laurier report calls for two of the five principles in the Act to be dropped: first, the condition that provincial insurance systems be publically administered, and second, the prohibition of user fees. The other three principles -- universal coverage, comprehensive coverage of medically necessary services provided by doctors and hospitals, and inter-provincial portability -- would remain unchanged.

The Act requires the provinces and territories to conform to the five broad principles in order to receive federal funds. Beyond these principles, however, they are free to design their systems as they wish to meet their respective needs.

The Canada Health Act is thus a statement of national values that aggregates 13 somewhat disparate systems into a cherished national program. And by most international comparators, and Canadian public opinion, it works pretty well most of the time.

Within this national framework, the provinces have enormous scope with respect to how they can organize, co-ordinate and manage their delivery systems, in what form and how much they pay their doctors and other health care professionals, how they fund their hospitals and other institutions, how much they spend, and even -- to a limited extent -- what services to provide.

Indeed, while respecting the principles of the Act, provinces have already invested in a wide variety of innovations as pilot projects, many with very positive results. While provinces may be encountering some problems scaling up promising reforms, a lack of discretionary room to innovate is not the roadblock.

So there are already ample provincial levers available to improve our health care system. What might be at risk if we abandon these two principles of the Act?

First, on the requirement of public administration, it is important to point out that this refers only to the financing of insured services -- it does not speak about the providers. There are already many private providers in all of the provincial health systems, including the majority of the doctors, diagnostics labs, and even some hospital-like institutions. There is nothing in the public administration clause that prevents provinces from proceeding further down this path if they choose.

The public administration provision requires only that all providers of insured services be paid out of the provincial treasury. It is this provision that creates the much-heralded "single-payer" model that is administratively highly efficient and justifiably lauded by most analysts, here at home, and internationally. We should not abandon this in pursuit of unnecessarily increasing provincial policy discretion.

Critics, including the MLI study, point out that some European countries allow their citizens to use alternate insurance plans. But these plans are usually not what Canadians envision when we hear the phrase "private insurance"; the European plans are likely to be non-profit insurance pools or insurance co-ops. In all cases, they are strictly regulated.

On the topic of user fees, critics routinely suggest they would ease pressure on taxation, and in part, discourage unnecessary demands for service. But there has never been any good evidence to suggest that user fees would do anything more than shift costs away from healthier and wealthier taxpayers to sicker and poorer users. In fact, there is no evidence at all that user fees reduce the unnecessary uses of health services. It is just as likely that "legitimate" users may delay seeking appropriate care until their conditions become more acute, more complicated and more expensive -- on the public dime.

Ultimately, the real risk is that Medicare would soon become a public program serving the lower tiers of the income spectrum, and for those with the greatest and most complex health needs (the two groups heavily overlap). Higher income individuals would quickly perceive an alternative: buying what they need in a private health care market and reducing their commitment to maintaining the public system with their taxes.

If that happens, can anyone be confident that a high quality public system can be sustained?