Published in the Calgary Herald on January 24, 2012
By Colin Busby
Ottawa surprised the provinces last month by unilaterally announcing that future federal support for health would grow more slowly, and would be tied to population growth and the strength of the economy. But most of the provincial premiers who gathered in Victoria last week saw it as a provocative snub.
After loud throat clearing, the provinces announced plans for a joint research initiative into the health funding system and opportunities for learning from different policies. This might be a good outcome, and one that draws on the strengths of federalism.
At the heart of the provinces’ fight is the Canada health transfer. The cash value of the announced health transfer will be about $36 billion in 2016/17, or roughly $1,050 per resident. The transfer’s terms are linked to five principles outlined in the Canada Health Act – portability, accessibility, universality, public administration and comprehensiveness.
However, the Canada Health Act, sometimes a powerful rallying point for the public, or at least subject to much cheerleading from provincial and federal leaders, doesn’t really commit the provinces to much. In fact, many necessary health services are not considered medically necessary under the act – and different provinces deliver these services in different ways.
Take long-term care services and drug coverage, for example. In Manitoba, the monthly cost of residential care ranges from $939 to $2,200 per month, depending on a person’s or couple’s income. In contrast, a similar stay in Ontario would cost about $1,860 per month, regardless of a resident’s income.
Likewise for public drug benefits: Alberta offers coverage for all residents aged 65 and up, whereas in British Columbia, public drug coverage is tied to income, regardless of age.
Accessibility to basic health services also varies a lot by province. In 2010, there were roughly 2.3 doctors per thousand people in Nova Scotia, but only 1.7 doctors per thousand in Saskatchewan. For registered nurses and licensed practical nurses, the figures range from a high of 1.5 per thousand in Newfoundland and Labrador to a low of 0.8 per thousand people in British Columbia.
In any case, the federal government doesn’t get much credit from imposing conditions on the provinces. In return for an increase in transfers in 2004, the provinces agreed to reach a set of health reform goals that included reduced wait times, primary-care reform and strengthened programs to address the problem of catastrophic drug expenditures. And there has been some improvement in wait times, but overall, progress on these reforms has been very slow.
Ottawa’s ability to enforce agreed to standards is limited, and they never get much political reward for doing anything other than providing funding. Further, progress is also difficult to measure and enforce.
Within the current framework, therefore, is an opportunity for the provinces to innovate, differentiate and find what works best for their residents. There is also occasion for provinces to unite in favour of reform and to deal more effectively with political resistance to change. If last week’s announcement is any indication, the provinces are off to a good start.
Ottawa could also help by serving as a policy clearing house. For instance, it could review and publicize the experience with alternative methods of compensating primary care providers in Ontario, paying for hospital services in British Columbia, or covering drug costs in Quebec.
Ottawa could also help the provinces by providing explicit and visible interpretations of some of the Canada Health Act’s opaque provisions. One example is the public administration condition, which refers to the administration of the provincial insurance plan and not the provision of health services. Another is the question of how the accessibility principle squares with income-tested benefits.
Overall, there has never been much in it for the feds to be too prescriptive with health care. Provinces generally do not like Ottawa’s involvement, and Ottawa struggles to enforce agreed to reforms. By taking a passive role in health-care delivery and ensuring large and transparent transfers, Ottawa could be on the right track by allowing the provinces to get credit for their successes — and failures — in delivering health care.
Colin Busby is a senior policy analyst at the C.D. Howe Institute in Toronto.
