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Time for Ottawa to Change Course on Health Care

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The current federal-provincial Accord governing the Canada Health Transfer expires in 2014 and the early preparations for the next round of negotiations are getting underway. At this stage, signs are not encouraging. The Harper government appears to want to get Ottawa out of the health sector as much as possible; so its primary objective is likely to be restraining the growth of the transfer beyond 2014, with little concern for the programmatic content of the next accord. The provinces, as always, will want to maximize the transfer while seeking to avoid any commitments in return.

Obviously, the money is important, but it should not be the only issue or even the most important issue in the upcoming negotiations. The current arrangements are seriously flawed, so simply extending them for a further five or 10 years will not do. The current fiscal arrangements, because they do not require the provinces to make any meaningful performance commitments, are incapable of being an effective instrument to help resolve well-known problems and bottlenecks in Medicare. Take just one example. Inadequate long-term and home care capacity has been repeatedly identified as being a critical factor in unacceptably long wait times and hospital over-crowding. Nothing in the current Accord addresses this issue effectively. Yes, simply providing money helps, but effective targeting would help much more.

At the same time, ambiguity and lack of transparency are the hallmarks of the current financial arrangements probably because this suits all governments for different reasons. Ottawa likes to claim a share of the political credit for supporting Medicare, but, when criticisms arise, is quick to note that responsibility lies with the provinces. The provinces like to assert their jurisdiction over health care but never hesitate to point to "inadequate funding" from Ottawa to explain away failures. It is no surprise when ordinary patients and taxpayers are confused about where to focus their attentions when they have concerns or criticisms.

Can we get beyond this? Of course, but it would require Ottawa to change course and recognize that it has an important role to play in health care. The vision of federalism where each order of government operates in its own spheres in splendid isolation is not realistic (and arguably never was) in a world where resources, capital and, most of all people are more mobile than they have ever been. Ottawa must be prepared to assert - while recognizing provincial jurisdiction - that it is justified in expecting identifiable progress for the billions of dollars it already provides and the additional billions it will be expected to provide in the future. (After all, they are not hesitant to insist on value-for-money in their own direct spending programs, so why not here as well?) And it would require the provinces to recognize -- while maintaining their authority over health care -- that there are national interests in Medicare that lie behind the billions that Ottawa contributes.

Assuming that Ottawa is open to representing the national interest in health, here is one suggestion of what an alternative arrangement might look like. A modified model of federal-provincial fiscal arrangements seemed to be emerging several years ago around the federal transfer of gas tax revenues to municipalities (via the provinces) for infrastructure investment and around the previous government's child day care program. (The latter was cancelled by the Harper government before it became a reality because the Conservatives had another vision for child care, not because of the financing model.) It would involve the negotiation of separate contractual agreements between Ottawa and each province. These agreements, like any contract, would involve an exchange. One party (Ottawa) would agree to pay money and, in exchange, the other party (a province) would commit to certain performances (such as observing the principles of the Canada Health Act, enhancements of specified services, investments in long-term care facilities). Some of the contract terms would be standard in all the agreements (adherence to the CHA), but others could vary depending on the specific pressures and bottlenecks in individual provinces.

This approach would not be a leap into uncharted territory; the provinces have already demonstrated in the gas tax program that they are willing to make fairly specific commitments in the context of "contracts" between two sovereign governments. In that sense, 10 health contracts rather than one health accord would not break new ground. As in any contract, the commitments and responsibilities of each party would be explicit, thereby promoting transparency and accountability. But let us not be unrealistic about how much would change. For example, it would be unrealistic to expect "complete" contracts to emerge from this process; it is unlikely that governments could reach agreement on clear indicators of contract compliance and consequences for non-compliance. That said, one-on-one agreements would still be a step towards improvement. A simple renewal of the existing Accord would not.

Allan Maslove is a Professor at the School of Public Policy & Administration, Carleton University. He is also an expert advisor with EvidenceNetwork.ca, a comprehensive and non-partisan online resource designed to help journalists covering health policy issues in Canada.

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