Provinces bristle at federal health "deal"

Mon Jan 16, 2012 7:17pm EST
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By Keith Norbury

VICTORIA, British Columbia (Reuters) - The provinces unanimously believe the federal government's unilateral decision to impose a new formula for how it will help fund the public healthcare system "was both unprecedented and unacceptable," British Columbia Premier Christy Clark said Monday.

Clark made the remarks after chairing a meeting of the provincial premiers, where the main topic was Finance Minister Jim Flaherty's announcement last month of how much federal health spending would go up for the next decade and beyond.

She answered, "No," when asked if the premiers had no choice but to accept the federal government's arrangement.

"I think there was a strong sense among premiers in the room that there is an opportunity for us to engage in dialogue," she said. "You know, the thing about healthcare in Canada is it's not there to serve the federal government or the provincial government or politicians. It's there to service citizens."

Under the new federal formula, Ottawa will continue to boost its health transfers to the provinces, which run the free public health system, by 6 percent a year through 2016-17, and then raise it by inflation plus the real growth rate of the economy - an amount expected to be less than 6 percent.

Provinces complained that would mean cuts to health services because of the rising cost of medicine and an increase in the number of seniors, whose health needs are greater.

The expected bulge in healthcare spending as baby boomers age is a problem facing not just Canada but the United States and most developed countries, whether their health systems are public or private or a mix.

Conservative Prime Minister Stephen Harper said the certainty in funding for the next decade would enable the provinces to concentrate on innovations to contain costs, but rejected the possibility of financing a supplementary innovation fund to speed that up.   Continued...