• Feb 07, 2023
  • Insights

First ministers’ meeting on health care funding


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The federal proposals

The prime minister met with provincial and territorial premiers on Tuesday in Ottawa to discuss the funding of Canada’s over-stretched health care system. Prime Minister Justin Trudeau tabled his government’s much anticipated health funding proposals:

  • The federal government will increase its health care spending by $196 billion over the next ten years, including new commitments of $46.2 billion over what was previously budgeted.
  • To start, provinces and territories will receive an unconditional $2 billion top-up to the Canada Health Transfer (CHT) to address “immediate pressure on the health-care system, especially in pediatric hospitals, emergency rooms and surgical and diagnostic backlogs.” In addition, over the next five years, the CHT will be increased by five per cent annually, with the option of a permanent increase at the end of that period.
  • To access the increase to the enhanced CHT, provinces must agree to improving how health data is “collected, shared, used and reported to Canadians to promote greater transparency on results, and to help manage public health emergencies,” according to a federal background paper released today.
  • The new federal money includes $25 billion over 10 years to advance what the government is calling “shared priorities,” but Ottawa is insisting that these new funds be directed at four priority areas: family health services, health workers and backlogs, mental health and substance use and a “modernized health system.” These priorities are to be included in bilateral agreements to be negotiated between the two levels of government.
  • Finally, the federal government will also provide $1.7 billion in new spending over the next five years to increase the wages of personal support workers and another $150 million to assist Yukon, Nunavut and the Northwest Territories with the added costs of health care in the north.

Prime Minister Justin Trudeau said of the federal offer, “These additional federal investments will be contingent on continued health care investments by provinces and territories. This funding builds on the $7.8 billion over five years that has yet to flow to provinces and territories for mental health and substance use, home and community care, and long-term care.”

Prime Minister Justin Trudeau flips open a briefing book


The premiers had been holding out for the federal government to increase its unconditional transfers for health care by $28 billion, from $42 billion to $70 billion, and to maintain this contribution level over time, with a minimum annual escalator of five per cent. The federal offer of an unconditional $2 billion top-up to the Canada Health Transfer (CHT) doesn’t come close to meeting this demand.

While the federal government yielded on the escalator, Manitoba Premier Heather Stefanson called the federal offer “disappointing,” Quebec’s Premier Legault said it was “insufficient,” and B.C. Premier Eby called it “fiscally limited.” Ontario Premier Ford was more positive, saying that the federal offer could form the basis of “continued improvement” in health care.

In the news conference following the meeting, the premiers appeared be surprised and somewhat shocked by the federal offer. While they had set the bar of expectations high and boxed themselves in, they perhaps had not expected the prime minister to call their bluff. Why they all sounded so optimistic going into the meeting without knowing the financial details of the offer is a mystery. The federal offer leverages public anxiety over health care to provide a minimal but impressive sounding total.

One common thread emerged at this afternoon’s news conference — the need for reform.

The provinces can hardly now walk away but after analysing the details of the federal offer, they will attempt to get more. But the provinces are not united, so we will see if they can maintain a common front, though it is unlikely.

The influence of public opinion

Public opinion played a major role in setting the stage for today’s meeting and bringing the prime minister and premiers to the table. Canadians have long held our health care system in high regard. Until recently, it was a source of national pride, and many still consider it as a hallmark of their citizenship. With the current challenges facing health care in sharp relief, a recent Leger poll found that 86 per cent of Canadians were worried about the sate of health care, and 43 per cent rated the quality of their provincial health system as “poor or very poor,” while 69 per cent of Canadians who responded to the survey said their provincial governments were not putting enough money into the system.

The COVID-19 pandemic was a stress test that shattered the allusions of many Canadians about health care. More than 17,000 residents of long-term care facilities died, representing 69 per cent of all COVID-19 deaths in Canada – the worst record among industrial countries. Coming out of the pandemic, health care faces major human resource shortages, and widespread staff burnout and blocked or closed hospital emergency departments. In May 2022, Ontario alone had a pandemic backlog of almost 22 million health-care services and treatments, including one million delayed surgeries. Six million Canadians can’t find a doctor.

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