Ottawa must amend Canada Health Act to allow meaningful health-care reform

Canada’s health-care system is broken, with patients enduring record delays in one of the least accessible—and most expensive—universal health-care systems in the developed world. In response, the federal government has doubled down on the same old approach of big dollar announcements alongside promises that things will improve.

But in fact, big spending increases and a bigger role for Ottawa are the opposite of what’s required. The federal government should learn from its own past policy successes and allow the provinces to innovate and finally fix health care for Canadians.

Consider the state of health care after more than two decades of the same old approach (including 2004’s 10-year Plan to Strengthen Health Care, the 2017 Common Statement of Principles and the Trudeau government’s latest $46 billion commitment). In 2023, wait times in Canada reached an all-time high of 27.7 weeks from GP referral to treatment, roughly 50 per cent longer than the 17.7-week wait in 2004. Canada also ranks at the bottom in international comparisons of wait times for specialist consultations and non-emergency surgery. And Canadians still have some of the worst access to medical technologies, physicians and hospital beds in the developed world, just like in 2004.

And yet, Canadians foot the bill for one of the developed world’s most expensive universal access health-care systems (as a share of the economy, accounting for Canada’s relatively youthful population), a distinction Canada has held since the early 2000s.

But again, many Canadians may not realize that Ottawa’s involvement is part of the problem. And that the solutions to our health-care woes can be found in other universal health-care countries that provide more timely access to quality care.

Every one of these countries (e.g. Germany, Switzerland, Australia, the Netherlands) follows the same approach, which includes patient cost-sharing for physician and hospital services, and private competition in the delivery of universally accessible services with money following patients to hospitals and surgical clinics. All these countries allow private purchases of health care, as this reduces the burden on the universal system and creates a valuable safety valve for it.

Unfortunately for Canadians, expanding cash transfers from Ottawa discourage provinces from adopting these policies while also discouraging provinces from experimentation and innovation. Why? Because to receive federal transfers, provinces must abide by the terms and conditions of the Canada Health Act (CHA), which prescribes often vaguely defined federal preferences for health policy and explicitly prohibits cost-sharing. That threat of financial penalty keeps the provinces beholden to a policy approach that’s clearly failing Canadians.

Canadians would be far better off if Ottawa learned from its own welfare reforms in the 1990s, which reduced federal transfers and allowed provinces more flexibility with policymaking. The resulting period of provincial policy innovation reduced welfare dependency and government spending on social assistance (i.e. savings for taxpayers). Put simply, when Ottawa stepped back and allowed the provinces to vary policy to their unique circumstances, Canadians got improved outcomes for fewer dollars.

We need that same approach for health care today. While big federal dollar announcements may appeal to politicians, they do nothing to improve health care and in fact work against improvements by further tying provinces to a failed approach. If policymakers want Canadians to finally have access to the world-class health-care system we already pay for, they should allow the provinces to choose their own set of universal health-care policies, emulating the successful approaches followed abroad.