Federal and provincial ministers play the percentages in health-care talks

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On her way into what would prove to be another inconclusive meeting about Canadian medicare, Jane Philpott felt it necessary to remind everyone that this isn’t about “percentages.”

“What’s most important is the people,” the federal health minister explained.

On this, if nothing else, there was agreement.

“We will continue to stand up for Canadians and we will push back on ultimatums being issued by the federal ministers at the expense of real people,” said Manitoba Health Minister Kelvin Goertzen, leading a delegation of provincial representatives who followed Philpott to the microphone.

So yes, this is about the Canadian people and the extent and quality of the public health-care system that is available to them.

Which is to say, it’s about the percentages: who pays and how much.

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Manitoba Health Minister Kelvin Goertzen told reporters the provincial ministers are prepared to ‘push back’ against ultimatums from the federal government. (Adrian Wyld/Canadian Press)

In the beginning, several generations ago, there was an agreement that the federal and provincial governments would share the cost of medicare. And thus were the two levels of government joined together, to spend eternity bickering over how to apportion responsibility.

Provinces have suggested during this latest round of negotiation that the federal government should cover 25 per cent of the total cost of health care. But there doesn’t seem to be anything particularly magical about that number.

The federal contribution last amounted to that much in 1980. After falling for the next two decades, it has since risen to 23 per cent. But the federal share could decrease again in the years ahead if health-care costs increase as expected because of an aging population.

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P.E.I. Premier Wade MacLauchlan and his provincial colleagues across the country focus on different numbers than the federal government when it comes health-care spending. (Adrian Wyld/Canadian Press)

That potential decreased share is linked to the previous Conservative government’s decision that the Canada Health Transfer, the primary mechanism through which the federal government funds medicare, would increase each year by three per cent or, if higher, the annual rate of economic growth (nominal GDP), starting in 2017.

In Ottawa on Monday, the provinces proposed the annual increase be 5.2 per cent.

The Trudeau government is offering 3.5 per cent, with no adjustment for economic growth.

The Liberals would also provide $11.5 billion over 10 years for spending on home care and mental health, with some expectation that the provinces will report precisely what comes of that money.

Looking at different things

The federal government looks at recent trends in provincial spending and sees health care has been increasing by one or two per cent each year.

The provinces look at how much more money they might have to spend in future years.

The Liberals look at their own proposal and say they’re offering the provinces $25 billion over the next five years.

The provinces look at the federal offer and figure they’re getting $30 billion less than they need over the next ten years.

As much as the provinces might like more money, the federal government has a deficit hanging over its head.

At the end of the day, New Brunswick made a daring move to suggest it might go it alone and make a deal with the Trudeau government.

In light of all that, Conservative leadership candidate Maxime Bernier proudly pointed out on Monday evening that he’s proposing the federal government get out of funding health care entirely.

Alternatively, if you believe the federal government has some greater role to play in health care, you might have to put up with regular rounds of haggling.

Targeted money

Heading into Monday’s discussions, Philpott described her government’s offerings as “substantial” — an adjective she would utter at least four times in the course of briefing reporters. After the meeting, Finance Minister Bill Morneau would opt for “significant.”

“The really exciting story today is that we are making new investments that have never been done before by the federal government,” Philpott said, specifically referring to the money for home care and mental health.

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Finance Minister Bill Morneau and Health Minister Jane Philpott speak to reporters after the provincial ministers rejected their health-care deal. (Adrian Wyld/Canadian Press)

Unlike the health transfer, which flows into the general revenues of each province, providing targeted funds and requiring that results be measured and reported would seem like an actual federal initiative on medicare: something that could give the federal government a tangible benefit to point to.

If the transfer fails to meet provincial demands, the provinces can simply blame the federal government for any reduction in service.

‘We will continue to stand up for Canadians and and we will push back on ultimatums being issued by the federal ministers at the expense of real people.’ – Manitoba Health Minister Kelvin Goertzen

Asked what leverage the provinces had in demanding more money from the Trudeau government, Manitoba’s Goertzen invoked the letters he receives from concerned Canadians (even if he seemed to decide halfway through his soliloquy that the term “leverage” might seem a bit insensitive).

“Our greatest leverage is [that] every man or woman here who is a health minister gets the letters, every day. From Canadians who tell them they’re waiting in ERs too long. They get the letters every day from Canadians who tell them, ‘I’m waiting for a test, or my loved one is waiting for a test and I’m scared.’

“Every one of my colleagues gets those letters and we read them. Is that leverage? Well, I don’t want to call it leverage, but that’s reality. And we will bring that message to … the federal government. If they won’t listen to us … will they listen to the Canadians who are saying, ‘This has to change, our system isn’t good enough?'”

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Manitoba Health Minister Kelvin Goertzen says he and his colleagues get letters every day from Canadians who’ve been let down by the health-care system. (CBC)

To this, some, including Philpott, might argue that money won’t fix everything.

But the question of percentages seems a rather significant and unavoidable part of the conversation.

The provinces, Goertzen said, want to keep talking, presumably about more money, but maybe, if that gets settled, about other things.

​”We know that we share interests with provinces in making a real difference for Canadians,” Bill Morneau offered at the end of the afternoon.

His government, he said, had settled on “the appropriate amount that we can spend.”

But, alas, it wasn’t enough.

“My conclusion,” Morneau explained to reporters, “is that the provinces were seeking more money.”

So at least the day provided the federal finance minister with that insight.

Health minister ‘frankly astonished’ provinces rejected deal6:58

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Federal and provincial ministers play the percentages in health-care talks

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