Avg  Family Income   Avg Tax Bill   Tax Rate   Health Care Tax Cost

                              $  10,845                         $    1,600       14.8 %       $      362

                                  22,244                               4,604       20.7                1,041

                                  30,377                               9,076       29.9                2,052

                                  38,106                             14,533       38.1                3,286

                                  47,059                             20,507       43.6                4,637

                                  58,446                             25,941       44.4                5,865

                                  71,169                             32,692       45.9                7,392

                                  87,475                             41,053       46.9                9,282

                                109,450                             52,530       48.0              11,877

                                204,954                           116,859       57,0              26,423

Unattached Indiv.      31,018                             13,576       43.8                3,070

2  Parents   0  Child   78,848                             39,357       49.9                8,899

2  Parents   1  Child   90,373                             39,676       43.9                8,971

2  Parents   2  Child   97,454                             43,382       44.5                9,809

1  Parent     1 Child   38,981                              13,564      34.8                 3,067

1  Parent     2 Child   38,637                              12,089      31.3                 2,734

The Canada Health Act (CHA), contrary to political statements and published articles, is limited in scope.  Two important distinctions: health care and health insurance are two separate things and the federal government has virtually no constitutional jurisdiction over these matters.  Health Care is the providing of medical services.  Health Insurance pays for those services.  In Canada, many of these services are provided in public hospitals and by provincially employed staff.  However, a large proportion of health care is provided in privately owned clinics and other facilities.  In fact, most doctors’ offices and many other medical facilities in Canada are privately owned and operated as businesses, even though much of their revenue comes from provincial governments’ medical insurance plans.

One of the more prevalent myths is that the CHA requires that hospitals be government owned and operated and prohibits privately owned medical facilities.  This fallacy is the touchstone of many who oppose private clinics on the basis that they are “violations of the Canada Health Act.”  In fact, the CHA says nothing about how, or where, health care is delivered.  The CHA also does not require, or even mention, public ownership of medical facilities or public employment of doctors or other health care providers.  Suggestions that private clinics or privately employed doctors and nurses amount to “violations” of the CHA are simply wrong.

The CHA is nothing more than a funding law.  It governs, on rather loose terms, the transfer of money from the federal government to the provinces to subsidize the cost of provincial governments’ health insurance plans.  The CHA has been described by courts as an exercise of the federal government’s “spending power” under the constitution.

It is also important to note that the federal government has no jurisdiction to make laws banning private health insurance or governing privately owned medical facilities.  Those are provincial matters under the constitution.  The CHA does not purport to control what individuals or businesses can or cannot do.  It is therefore impossible for any citizen or business to “violate” the CHA.  In fact, even provinces cannot be taken to court successfully for breaching the CHA.  Courts have consistently held that they cannot rule on whether a province has complied with CHA.  Courts have held that this is a political rather than a legal matter, and that the ramifications of non-compliance with the CHA must be determined by the federal cabinet and Minister of Health, by possibly withholding federal cash transfers to a province (these cash transfers represent the taxes paid by each Canadian).

Every province has a tax payer funded health insurance plan.  Provincial insurance plans are government run systems that receive money from taxpayers, through premiums, or allocation of government revenue, or both.  As a matter of constitutional law, provinces may pass any laws they want about whether there is any government medical insurance and, if so, what its limits are.  The coverage under existing government plans is far from comprehensive.  Two major gaps that are largely filled by private insurance are the costs of most dental care and medications.

 Most, but not all, provinces have laws that ban private medical insurance for services that are covered by government insurance plans.  This is because of conditions that the federal government attaches to its contributions (your taxes paid) to the cost of health care.  Since the late 1950’s the federal government has contributed to medical costs through financial transfers to the provinces.  This culminated in the passing of the CHA in 1984.  At that time the contribution of the federal government to taxpayer funded medical costs was about 50 percent of the national total.  Currently the contribution is about half that.  Clearly, the level of federal financing that provided the political backdrop to the creation of the CHA no longer exists.

Despite this, the federal government continues to tie the provinces’ hands by attaching conditions to its financial transfers (your taxes paid).  Under the CHA, for a province to receive a “full cash contribution” from the federal government, the province’s health insurance plan must meet several criteria, including “public administration” (monopoly), and “comprehensiveness”.  “Public administration” is defined to mean that the provincial health insurance plan (not the providing of medical care) must be administered on a non profit basis by a public authority.  “Comprehensiveness” is not clearly defined.  There is no national standard of what services must be covered by provincial insurance plans and to what level of quality.

The CHA also says extra billing and user charges must not be permitted by a province or else funding from the federal government may be reduced.  “Extra billing” is charging a patient an amount above what is paid under the province’s health insurance plan.  “User charges” are any charges by care providers for provincially insured services.  In other insurance contexts, user charges are called “deductibles” and are intended to encourage safety and reduce claims.  Imagine if automobile insurers were prohibited from selling collision insurance with a deductible; both the number of claims and the frequency of small claims would skyrocket.

Health care costs are the largest single component of provincial budgets.  Within 10 years between 50 and 70 percent of British Columbia’s total annual budget will be health care costs and every province will be spending 100 per cent of their annual budgets on health care by 2050.  This fact alone makes more reliance on private medical insurance inevitable but today it is still the political kiss of death to broach the subject.  In 2005, the Supreme Court of Canada recognized this government paralysis in the Chaoulli decision when it acknowledged that citizens have been forced to turn to the courts because governments have failed to provide solutions to growing waiting lists.  The court also recognized that provinces use waiting lists as a rationing system to reduce spending by government health insurance plans.  If governments continue to not pay for or provide timely care, the courts will probably decide the matter of health care reform and more privatization on behalf of adversely affected citizens.

Mickey Moulder