Errors from both the Federal and Provincial Health Ministers

October 13, 2006

Errors from both the Federal and Provincial Health Ministers

According to Vancouver Sun columnist Vaughn Palmer, Health Minister George Abbott has said that the Campbell government won't bend to the will of the federal government that is paying "only six per cent of the bill." That was in reaction to federal Health Minister Tony Clement saying while he was in Vancouver on October 10th that the Canada Health Act is federal legislation and "we're not opening it up." Abbott was wrong about federal spending, and Clement was wrong about provincial control over the Canada Health Act.

There is a lot of confusion around the Canada Health Act and federal cost sharing. According to the table of expense by function in Finance Minister Carole Taylor's First Quarterly Report 2006/07, health will cost $12.933 billion in 2006/07. Federal transfers to BC for health and social services (shown in table 1.2 of Taylor's report) are $4.421 billion. The catch 22 is because federal transfers have gone through a complicated transition over the past 40 years it sometimes is difficult to say how much is going to health and how much is going to education or social services. According to the federal government, in 2006/07 BC will receive $2.782 billion in cash from the Canada Health Transfer and $1.425 billion in tax points. That makes the federal cash contribution equal to 21.5%, a far cry from 6%, and it makes the total federal contribution equal to 32.5%, if you count tax points, which go back a very long way in the history of transfers.

Abbott didn't refer to the document produced by Taylor or to any document produced by the federal government; he claimed his 6% figure came from the Canadian Institute for Health Information (CIHI). CIHI publishes an interesting table titled "Total Health Expenditure by Source of Finance". Its preliminary figures for 2005 show the federal government directly spent $5.9335 billion and the provinces $89.8136 billion. Municipalities and social security funds account for another $3 billion, for total public expenditures of $98.7953 billion. That means federal direct spending is 6.0% of the total, but that also means that Abbott was very mixed-up. Federal direct spending on health care is exactly that, what it spends through its Ministry of Health, and to some extent through a few other programs. It does not include what it transfers to the provinces. Total federal cash transfers to the provinces for health care for 2006/07 are $20.14 billion; in 2004/05 they were $15.27 billion. Could it be that Abbott doesn't understand the difference between federal transfer payments and federal direct spending? Putting out false, inaccurate or misleading information does not help the conversation on health.

If you think federal-provincial cost sharing is confusing, wait until you wade through the definitions of the five principles of the Canada Health Act, which are:

(a) public administration;
(b) comprehensiveness;
(c) universality;
(d) portability; and
(e) accessibility.

As you would expect, the Canada Health Act defines the principles, but "comprehensiveness", a key concept, is defined in terms of "medically necessary" hospital services and "medically required" physician services. The terms "medically necessary" and "medically required" are not defined in either federal or provincial legislation so the Supreme Court of Canada had to do the job, and it did so with a BC case. In Auton (Guardian ad litem of) v. British Columbia (Attorney General), [2004] 3 S.C.R. 657, 2004 SCC 78, the court ruled that:

"In this case, the issue of whether the benefit claimed is one conferred by law does arise, and must be carefully considered. The claim, as discussed, is for funding for a "medically necessary" treatment. The unequal treatment is said to lie in funding medically required treatments for non-disabled Canadian children or adults with mental illness, while refusing to fund medically required ABA/IBI therapy to autistic children. The decisions under appeal proceeded on this basis. The trial judge, affirmed by the Court of Appeal, ruled that the discrimination lay in denying a "medically necessary" service to a disadvantaged group while providing "medically necessary" services for others. Thus the benefit claimed, in essence, is funding for all medically required treatment."

"This raises the question of whether the legislative scheme in fact provides anyone with all medically required treatment. An examination of the scheme shows that it does not: see Appendix A (Relevant Legislative and Regulatory Provisions) and Appendix B (Interaction of the Relevant Legislative and Regulatory Provisions)."

Appendix B in the decision went on to say:

"The MPA (Medicare Protection Act) requires that a potential benefit be determined to be "medically required" before it is added to the roster of insured services. This term is not defined, however. No service is "medically required" under the statute until it has been designated as a benefit. An individual's physician may view a particular non-core service as "medically required" for his or her personal health. However, this does not make it "medically required" under the Act. That power rests solely with the provincial government."

In other words, the province essentially defines a key principle in the Canada Health Act, and it can change the definition whenever it wants by changing its roster of insured services. That is exactly what the Campbell government did when it eliminated routine eye exams for anyone between age 19 and 64. If the government chooses to face the political heat, it has the power to eliminate coverage for any procedure from "A" to "Z", from angioplasty to zygomatic arch/open reduction. There is nothing in the Canada Health Act that protects British Columbians against a government that decides to change what is covered by Medicare. Only a politically active and informed public will assure that Medicare remains comprehensive, and perhaps becomes more so.

A year after the Auton decision, the Supreme Court revisited fundamental principles of Medicare in Chaoulli v. Quebec (Attorney General), 2005 SCC 35, [2005] 1 S.C.R. 791 where the majority of the court ruled that:

"In sum, the prohibition on obtaining private health insurance, while it might be constitutional in circumstances where health care services are reasonable as to both quality and timeliness, is not constitutional where the public system fails to deliver reasonable services. Life, liberty and security of the person must prevail. To paraphrase Dickson C.J. in Morgentaler, at p. 73, if the government chooses to act, it must do so properly."

Two dissenting judges argued that:

"The Court recently held in Auton (Guardian ad litem of) v. British Columbia (Attorney General), [2004] 3 S.C.R. 657, 2004 SCC 78, that the government was not required to fund the treatment of autistic children. It did not on that occasion address in constitutional terms the scope and nature of "reasonable" health services. Courts will now have to make that determination."

By introducing the idea of "reasonable" health services, the dissenting judges may have been trying to re-open the debate on the definition of medically required or medically necessary, but they did not convince their judicial colleagues. The majority decision did not reference Auton; it simply said that the province could not prohibit the purchase of private health insurance when the public system fails to deliver in a timely manner.

Definitions of the other four principles of the Canada Health Act have not been subject to judicial interpretation but that should not comfort anyone. The Act makes it clear that "public administration" does not prohibit contracting out, as BC did with the administration of MSP and Pharmacare to Maximus, and it does not prohibit hospitals contracting out surgeries to private clinics. What it does is provide that the federal government can financially punish the province if it allows private clinics to accept payment for queue jumping (the patient pays to get services quicker than under the public plan). If that restriction is what worries the Campbell government, it might explain why Dr. Brian Day, of the False Creek Surgery Centre and president-elect of the Canadian Medical Association, was invited to keynote the roundtable discussion for elected officials that was one of the initial events for the conversation on health.

BC's Medicare Protection Act includes a preamble which states:

"WHEREAS the people and government of British Columbia believe that medicare is one of the defining features of Canadian nationhood and are committed to its preservation for future generations;

WHEREAS the people and government of British Columbia wish to confirm and entrench universality, comprehensiveness, accessibility, portability and public administration as the guiding principles of the health care system of British Columbia and are committed to the preservation of these principles in perpetuity;

WHEREAS the people and government of British Columbia recognize a responsibility for the judicious use of medical services in order to maintain a fiscally sustainable health care system for future generations;

AND WHEREAS the people and government of British Columbia believe it to be fundamental that an individual's access to necessary medical care be solely based on need and not on the individual's ability to pay."

The third clause in the preamble refers to a "fiscally sustainable health care system". Premier Campbell is behaving as if he invented the idea of a principle of sustainability although it has been built into BC legislation since 1996. It is obvious that no area of spending can grow endlessly at a pace that exceeds the growth in government revenue. Fortunately in British Columbia revenue growth has exceeded growth in health spending. If the experience of the last four years continues, health spending will decrease as a percentage of total spending; however, over the next ten years it probably will increase slightly as a percentage of GDP.

Most British Columbians agree with the preamble to the Medicare Protection Act. If the Campbell government intends to change anything in that commitment, it should say so at the beginning of the conversation so it can hear what British Columbians have to say about the government's plans.