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Walter Cronkite, who was referred to as “the most trusted man in America” during the twenty years he anchored the CBS Evening News, once said, “America’s health care system is neither healthy, caring, nor a system.” He was right when he made that comment and he’d be right if he said the same thing today. Health care in the United States is an embarrassment. Plain and simple. However, before you go getting all smug on me, the same thing could just as easily be said about the health care system here in Canada. It’s also neither healthy, caring, nor a system. The reasons for this are many but most of the blame should go to the Canada Health Act, introduced by Pierre Trudeau and his Liberal government on December 12, 1983.

The bill, which was brought forth by Monique Bégin, the federal minister of health and welfare, was subtitled, “An Act relating to cash contributions by Canada and relating to criteria and conditions in respect of insured health services and extended health care services.” The preamble to the act stated that “continued access to quality health care without financial or other barriers will be critical to maintaining and improving the health and well-being of Canadians,” while the primary objective was “to protect, promote and restore the physical and mental well-being of residents of Canada and to facilitate reasonable access to health services without financial or other barriers.” The act, which combined and updated two earlier pieces of legislation — the Hospital Insurance and Diagnostic Services Act, 1957, and the Medical Care Act, 1966 — received royal assent on April 1, 1984. Many of us consider this date to be the beginning of the downward spiral medicare currently finds itself in.

Specifically, the Canada Health Act lays out the criteria, as well as the conditions, that provinces and territories must adhere to in order to be eligible for federal transfer payments under the Canada Health Transfer program. These include public administration, comprehensiveness, universality, portability, and accessibility. As well, extra-billing by physicians or dentists for insured health services under the terms of the health care insurance plan of that province or territory were now banned. Likewise, user fees imposed by hospitals or other health care providers for insured health services were also outlawed. Section 13 of the act lists two additional conditions the provinces had to meet in order not to be penalized further from receiving their full allotment of transfer payments from the federal government:

  1. The federal minister of health had the right to access specific information with regard to any province’s insured and extended health care systems. This information was to be used in the drafting of annual reports by the Department of Health, which would be delivered each year to Parliament, outlining how each province had administered and delivered health care services during the previous twelve months.
  2. The provinces were obliged to recognize the federal government’s contribution to the funding of both insured health services and extended health services any time a province released a public document or put out advertising or promotional material concerning medicare in that province.

With all the noise and chatter about the Canada Health Act over the years, it’s easy to forget the act only deals with how Canada’s health care system is funded, not how each individual province sets up its system and delivers care. It’s also instructive to remember that as a result of the way our country’s constitutional powers are divided, adherence to the conditions set out in the Canada Health Act is completely voluntary. In other words, no province or territory is obligated to embrace the act or follow it to the letter. However, the federal government made sure when they drafted the legislation it would contain enough disincentives that every province would eventually find it to their benefit to fall in line and adhere to the criteria and conditions of the Canada Health Act.

Should any province decide not to comply, something that has happened from time to time over the past three-decades-plus since the act became the law of the land, the federal government had the right to withhold all or part of a transfer payment, depending upon how egregious the offence. For instance, section 20 states quite clearly that should a province violate the prohibition on extra-billing or user fees, an amount equal to that collected would be deducted, dollar for dollar, from that province’s transfer payment. In 1993, the federal government reduced British Columbia’s transfer payments by more than $2 million after it was discovered the province had allowed roughly forty doctors to extra-bill patients over a four-year period. Three years later, it was Alberta’s turn. The province had its transfer payments reduced by more than $3 million because it turned a blind eye when private clinics started charging patients user fees. Newfoundland and Manitoba also suffered government clawbacks — $323,000 for Newfoundland and $2,056,000 for Manitoba — during the late 1990s, for much the same reason as Alberta. Not to be left out, Nova Scotia was similarly dinged for allowing user fees in private clinics. It’s important to note, though, that to date all issues regarding non-compliance have been, for the most part, settled through negotiation or discussions between ministers.


Those are some of the conditions and administrative details. Let’s peel back the skin of the onion and take a closer look at the five principles of the Canada Health Act in a little more detail.

Public Administration

Section 8 of the act says that in order to be eligible for health transfer payments from the federal government, all provincial health plans must be administered and operated on a non-profit basis by a public authority appointed or designated by the government of the province; the public authority must be responsible to the provincial government for that administration and operation; and the public authority must be subject to audit of its accounts and financial transactions by such authority as is charged by law with the audit of the accounts of the province. Again, it’s important to note that we’re talking here about the funding of health care, not the delivery of services. This is one of the things the pro-medicare crowd likes to wave around like a flag. The fact is nowhere does it say that health care services can’t be privately delivered, or even, I would argue, privately funded.


Section 9 says that provincial plans must cover all insured health services provided by hospitals, medical practitioners or dentists, and where the law of the province also permits, similar or additional services rendered by other health care practitioners. While the act makes clear in section 2 what is meant by insured services, there’s been a significant amount of debate over what should or should not be covered today in the twenty-first century. As has been pointed out, the Canada Health Act almost exclusively defines insured services as those delivered either in hospitals or by physicians. But with the shifting of care from hospitals to the community over the past twenty years, along with a growing dependence on home care, there undoubtedly is a need to re-examine these definitions and modernize them so that they better reflect the world as it exists today, not as it was back in the mid-1980s.


Section 10 states that all insured persons must be covered for insured health services provided for by the plan on uniform terms and conditions. Strangely, the act’s definition of insured persons doesn’t include those who may be covered by other provincial or federal legislation, such as active members of the Canadian Armed Forces or Royal Canadian Mounted Police, inmates of federal penitentiaries, those covered by provincial workers’ compensation plans, and some Indigenous Peoples. It also doesn’t include permanent residents or Canadians returning to live in Canada after having resided in other countries, the latter of whom are subject to a waiting period not to exceed three months before being classified as insured persons.


According to section 11 of the Canada Health Act, provinces must not impose any minimum period or residence, or waiting period, in excess of three months, before residents of the province are eligible for, or entitled to, insured health services. After the waiting period, the new province or territory of residence assumes health care coverage. It’s worth noting that portability provisions are subject to interprovincial agreements, as there can be variations from province to province vis-à-vis what is considered an emergency and whether or not the care received is to be paid at “home” province or “host” province rates, which can also vary from one part of the country to another.


Of the many criteria and conditions of the Canada Health Act, perhaps none have caused as much controversy over the years as this one. Section 12 states that each province’s insurance plan must provide for insured services on uniform terms and conditions and on a basis that does not impede or preclude, either directly or indirectly whether by charges made to insured persons or otherwise, reasonable access to those services by insured persons. Further, principle five allows for reasonable compensation for all insured services rendered by medical practitioners or dentists, as well as payments to hospitals to cover the cost of providing care to patients. And yet nowhere in the Canada Health Act is either “reasonable access” or “reasonable compensation” defined.

Part of the reason this fifth and final principle has caused so much consternation over the years, in addition to its lack of definitions and generally ambiguous language, is due to the inconsistencies across Canada when it comes to accessibility. Take abortion, for example. Pro-choice advocates have been quick to point out that access to abortion, defined as a medical service, fails to meet four of the five basic principles of the Canada Health Act. This is because abortion clinics, where most procedures are performed, are not funded equally, nor are these services available in all parts of the country.


To understand the inherent weaknesses of the Canada Health Act, and why our country’s health care system is failing to live up to any of the principles set out in the act, it might be instructive to stop for a moment and examine some of the crucial differences between today and 1961, when the Hall Commission was first struck, affecting health care spending. After digesting what follows, I believe you’ll have a much better understanding of why government is facing an uphill battle trying to fund health care and put the brakes on the runaway train that is patient demand and utilization of services.

Since the early 1960s, Canada’s population has more than doubled, rising from 18.2 million in 1961 to 36.6 million in 2017. Meanwhile, per capita spending on health care during that same period has increased more than sixty times — it was less than $100 per person in the early 1960s while it is a whopping $6,604 per person in 2017.

In 1961, 57 percent of health care in Canada was privately funded, while the rest was covered by government. Today, roughly 70 percent of health care is funded by the government, leaving approximately 30 percent to be covered by the private sector. At the same time that government coverage of health costs has been increasing, Canadian life expectancy has also increased. Over the past fifty-plus years, it has risen from sixty-eight (males) and seventy-nine (females) in 1961 to eighty (males) and eighty-four (females) today, while infant mortality rates, considered by many to be a key indicator of how healthy a country’s population truly is, have fallen from 27.3 per 1,000 in 1961 to less than 5 per 1,000.

With the rise in life expectancy, there has been an out-of-control growth in chronic disease in the last few years; today, it eats up more than 70 percent of health care costs in Canada.

If one couples all of that with the sobering news that three health care “tsunamis” — diabetes, obesity, and dementia — are waiting, just around the corner, to swamp our health care system, you’ll begin to get some idea of the trouble we find ourselves in.

Obviously, given the spiralling costs of Canada’s health care system, the status quo simply can’t continue to be an option. Whether we amend the Canada Health Act, add some sunset clauses, or just plain scrap it, the time is fast approaching where doing nothing will be the worst course of action possible. In fact, as I’ve often said, the best way to ensure we end up with the very thing most Canadians say they don’t want, a U.S.-style, two-tier health care system, is by leaving things the way they are.

The reality is we simply can’t afford “free” health care in this country anymore. It’s too damned expensive and it’s not even free — keep in mind that those of us who pay taxes provide the funds for the 70 percent of things medicare actually covers, while the other 30 percent either comes out of our pockets or is taken care of by private insurance, typically as part of the compensation package provided for Canadians by their employers.

And yet, even with all the money being poured into our health care system, there’s still not enough to fund patient demand. As a result, wait times are getting longer and longer, putting lives at risk and leading to an unconscionable amount of suffering by forcing people to wait mind-boggling amounts of time in order to access care.

In 2017, for instance, a general practitioner practising in Ontario was informed by a neurologist that it would take that specialist four and a half years to see the patient. Four and a half years! This is the legacy of the Canada Health Act. By stifling innovation and pretending we have the best health care system in the world, our elected officials and civil servants have made a mockery of the principles of the health care system that they proclaim they will fight to the end to preserve. As one of the judges in the 2004 Chaoulli case said — a case that involved Dr. Jacques Chaoulli and one of his patients challenging the provincial law that prohibited a patient from using private health insurance to pay for publicly insured health care services — “Access to a wait list is not the same as access to care.”

No kidding.

And yet, there are still those who think there’s nothing wrong with using the Canada Health Act as a sort of protective shield against the sick and infirm. In British Columbia, for example, Dr. Brian Day, former Canadian Medical Association president and long-time medical director of Cambie Surgery Centre, and some patients, have been trying to convince a judge their Charter rights have been violated by the B.C. government. I won’t go into details just yet, other than to tell you that Dr. Day’s Charter challenge asks the following fundamental question: Why should Canada, in contrast to every other country on earth, refuse to allow its citizens to purchase private insurance to cover physician and hospital services?

During the first six months of the trial, Dr. Day and his group burned through the $2 million they’d raised by asking those who care about health care and our country to donate to the cause, all because the government had deep pockets and endless resources designed to distract the judge from the real issue and tie up proceedings for months on end. Shamefully, the British Columbia government assigned twenty lawyers to the case and spent $20 million in the first six months in hopes that Dr. Day and his patients would run out of money and have to abandon their Charter challenge. Think about that for a moment. A provincial government spent $20 million of our tax dollars in order to ensure our fellow Canadians would be forced to continue to suffer and ultimately die on wait-lists — all in order to prop up the Canada Health Act and maintain the illusion that everything is fine. If that doesn’t infuriate you, you’d better check to see if you’re still breathing.

And just what is at stake here? What are they fighting about? “Privatization” … “the elephant in the room.” The thirteen-letter word that gets everyone, supporters of the status quo and critics, like me, of our non-healthy non-caring health care system, so fired up. As you may or may not know, privatization involves governments — any government, but in Canada most often provincial or territorial governments — shifting responsibilities to the private sector. It’s important to remember, as I alluded to earlier, that privatization of financing is not the same as privatization of delivery. Privatization of financing occurs when the government does things like delist services, or cut programs, or reduce fees in such a way as to make it unprofitable for medical practitioners or institutions to continue to offer a particular service.

Privatizing the delivery of health care services is different. There are plenty of examples of this. In many cases, provincial and territorial governments have entered into agreements with the private sector to provide services in non-traditional, noninstitutional settings that are paid for by the government out of public money — typically with an eye toward reducing wait-lists for a politically sensitive constituency, such as seniors (hence the special attention paid to things like cataract surgery and hip and joint replacement, often in the months leading up to an election).

But the privatization of delivery outside the medicare system … well now, for some reason, that’s different. At least it is in the minds of our elected officials and pro-medicare types. “We must not allow two-tier medicine to gain a foothold here in Canada,” they say. “It’s against everything we believe in as Canadians.” Oh, give me a break. What our leaders and those defenders of the status quo — particularly unions — are really concerned about is that the private sector just might deliver a better product at a cheaper price, all because of a little competition. But no, no, no … we can’t possibly allow that. It’s un-Canadian!

Of course, politicians being politicians, what they truly want is to have it both ways. They acknowledge privately that medicare is indeed unsustainable, and if we don’t soon wake up and smell the coffee, we’ll end up bankrupting the whole damned country. But they sure as hell don’t want to take the blame for allowing a parallel private health care system — what is referred to as the “hybrid solution” — to finally see the light of day and operate (legally) here in Canada. Crazy, isn’t it? The fear of stepping on the so-called third rail of Canadian politics, and thereby ending their political careers, has rendered just about every single one of them impotent. But it’s not just this that infuriates me. I’ve been told by a reliable source that the Ontario health ministry has actually commissioned a bunch of reports, trying to figure out a way the government can bring in a hybrid health care system without catching flak.

Perhaps the best way I can illustrate what’s wrong with the Canada Health Act and the crazy, mixed-up world it’s spawned is by sharing with you a conversation that occurred between Prime Minister Pierre Trudeau and Monique Bégin shortly before the bill became law (an anecdote related by Roy Romanow, the former premier of Saskatchewan and chair of the 2002 royal commission on health care).

One day, the health minister burst into Trudeau’s office and said, “I think we have a problem with the legislation. The provinces hate it. The Canadian Medical Association hates it. The hospitals hate it. The opposition hates it.”

The prime minister replied, “Where do the people stand?”

“Oh,” Bégin replied, “the people love it.”

“Well, then, Monique,” Trudeau smiled, “what’s the problem?”

Thirty-plus years later, the “problem” has become only too obvious.


Stephen Skyvington’s book, This May Hurt A Bit: Reinventing Canada’s Health Care System, was published February 2019 by Dundurn Press. Follow him on Twitter @SSkyvington.


The views, opinions and analyses expressed in the articles on National Newswatch are those of the contributor(s) and do not necessarily reflect the views or opinions of the publishers.
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