Health care has long been quintessential to Canada. However, gaps in Canada’s much-admired system have been visible for some time. The COVID pandemic only made them worse. Does the latest budget introduced by the federal government meet the needs of the provinces? We dig in, dissect, and discuss with editor-in-chief of CGE magazine, Dr. Lori Turnbull.

Q – What did you think of the health care deal that the federal government announced on February 7?

A – So this has been long-awaited. This has been something that the provinces and the federal government have talking about a long time and the provinces have been indicating they don’t have enough resources to be able to offer the quality of health care and to fix the kind of gaps that have been clear in the system for a long time and have been made worse by COVID. This has been a point of contention for a long time now and the deal that that was announced by Ottawa yesterday does not come close, financially, to what the provinces were asking for. Now, that shouldn’t be a surprise to anybody in the sense that this is a back and forth between the federal government and the provincial governments and provinces are always going to ask big and hope they get something close to that and the federal government’s never going match it entirely but we’re watching to see where they land. What’s the midpoint between them or what’s the agreement point between them? And we can see that, financially, this deal, at this point, falls quite short of what the provinces have been asking for.

I kind of wondered whether, at this point in Trudeau’s career, because he is a third term Prime Minister, he’s been there for almost eight years, he’s been leader of the party for almost 10 years, he’s got to be thinking about how he’s going to bring his political career to a close. This is a moment where he might want to do something transformative. But this deal is not something that really shakes the terrain of how we do health care in Canada. So, it’s interesting in the sense that they’re saying they’re going to bump up the Canada health transfer by five points if the provinces meet the requirements on data collection. And then they are also going to do bilateral agreements with the different provinces so that provinces can take a chunk of money and use it for things that they have deemed to be priorities in their own jurisdiction.

There is some opportunity here for politics in a good way on the part of premiers to push the Prime Minister to say, “this is what we need.” But I think, at this point, there’s no slam dunk to this. There is no sense that, okay, we’ve got a deal, everyone’s signed, everybody’s happy or even everybody’s not happy. There’s no closure at this point. There’re just more questions about what forms the bilateral agreements will take.

Q – You’re saying there’s a leadership opportunity, there may be an opportunity for a swan song, but right now, it’s not fixing health care. What needs to happen? What could be done to make this a good package? Is more money the answer?

A – We’ve been throwing money at health care, arguably not anywhere near enough, for a long time. But the fact of the Constitution, which is that the federal government has, overwhelmingly, the greater fiscal capacity and then the provinces have jurisdiction over health care, which is the most expensive program we have buy a lot – if we continue down that road without any sort of change in responsibilities or fiscal capacity, it means that we’re always going to have this scenario where the provinces are responsible for this huge program, but they don’t have the money to deliver it and they need to go to the feds for that. And even if they decided they were going to somehow go it alone, it would be wildly different what one province could offer as opposed to another, because we have different physical capacities in different populations and different strains on our health care systems. It was always the case when it came to health care that even though we don’t have a national system, we have provincial systems, we wanted a national standard. We wanted nobody to be without just because of where they lived. I think that we’re seeing the strain on that system now. Maybe we’re thinking differently about what sort of role the federal government could play but as long again as we have this division of responsibilities and fiscal capacity, we’re never going to get around this back and forth, passing the buck between the feds and the provinces.

Q – What country, in your opinion, is doing this well right now? Is there any? How about Norway? Is there any other country we could learn some best practices from?

A – It’s hard to compare to be honest, because we are a geographically big country, but population-wise, not a huge country. We are dispersed over a lot of land. We are a federal system as opposed to a unitary system. I know one thing that drives Michael Wernick crazy is when we compare ourselves to Estonia. We can’t replicate that. It is completely different world. So, I’m not sure it’s terribly useful to compare ourselves. Even if we could think of countries that we could compare ourselves to in terms of GDP or population or whatever, the fact that health care is so quintessential to the Canadian political identity, that’s a big issue. People think about this, and this is what makes us different from the Americans. We hold this program, we hold this so, so close to us, the idea that you could go to a hospital and not be seen, and you won’t be able to get the healthcare you need is like a gas light to everything we’ve ever been told about what it is to be Canadian. It’s not just about the program and the money. It’s also very dear to people. Even if we could find an administrative structure somewhere else that maybe provides better outcomes, and you could look at the money and all the rest of it, there’s still the fact that we’ve always made the promise to ourselves and each other, that you don’t have to pay for healthcare here. You don’t get to jump the line because you have money. Even if people are willing to permit more private involvement in delivery, there is no public tolerance for any kind of multi-tiered system where if you pay you get better health care.

Q – Do you think the provinces are going to go for this?

A – I think it depends. There are some provincial premiers like Doug Ford, for example, who is in a very powerful position because he won a big majority government within the last year and he’s also the premier of the largest province with the largest population. So, if Doug Ford has a problem with the deal, that’s a problem for Trudeau because so many people in Canada live in Ontario.  If Doug Ford and Premier Legault don’t like the deal, that’s a big problem for Trudeau again because there’s so many people. Those are the two most populous provinces, and they represent so much with respect to the national consensus. But I don’t think it’s the end of the world for Trudeau if everybody doesn’t agree. He’s got some people who are probably going to oppose, like Danielle Smith of Alberta, like Scott Moe in Saskatchewan. If that’s the case, he can withstand that. He doesn’t have to have everybody come to the table. There’s a lot of pressure on the provinces to take the money and the strings that go with it because people are so afraid that the health care system is going to go under. It’s going to be, politically, very difficult for a premier to explain why there was money on the table and they left it there because they didn’t like the terms.

Q – What would happen if they didn’t go for it? What would be the impact?

A – I think what’s probably going to happen is that you’re going to see agreement on the bump to the Canada health transfer in exchange for best practices and data collection. I think that’s an easy one. I think the provinces will go for that even if they huff and puff and say that the federal government should not be putting strings attached to health care money. Where you’re going to see the back and forth in a critical way is going to be the bilateral exchanges between the federal government and the provincial governments. There, you’ll see premiers walking out of the room, being upset about what they got, and that could be worthwhile for them, not only politically, but financially, if they show the Prime Minister that they’re going to be pushed around. On the other hand, if the Prime Minister is saying, look, we’ve got money in our hand here and you can come and get it if you do these reasonable things, then that puts some weight behind the Prime Minister’s position that they’re offering reasonable parameters in exchange for a significant transfer of funds, but of course the provinces will say it’s not enough. So, I think I think you’ll see widespread consensus on the Canada health transfer increase and the data collection strings that go with it. I think we’ll see the breakdown on the bilateral.

Q – Governments don’t usually plan in 10-year cycles. So, is this deal going to last even if the government’s change hands?

A – I think from a federal perspective, it’s interesting how the other parties are circling around this. Pierre Poilievre and the Conservatives don’t want to give the Prime Minister any credit for anything. They come out and say, look, this isn’t that much money. You haven’t given the provinces what they asked for. But when we form a government, we’ll hold on to this and we’ll honor these commitments. Therefore, they’re taking the wind out of Trudeau’s sails and saying we’ll do this. It’s not that much to begin with and we’ll follow it up. They’re not saying they’ll give anymore. They’re saying, sure, we’ll hold on to this, no problem. In other words, if you’re thinking about voting for Trudeau because you’re afraid to lose this package, don’t worry. We’re fine. But over a 10-year cycle with 10 provinces in it, all of them on different electoral cycles, those are a lot of variables. That’s a lot to manage. Over time, are the feds in? Yes. Are all 10 provinces going to stay in, even if they’re in now? Probably not. You’re going to see a lot of fluctuation as governments change hands. The first test of it all is going to be Daniel Smith going to the vote in Alberta in May, because Rachel Notley is a much more obvious partner for the Liberals. They might be thinking, look, if Danielle Smith wants to blow this up, go ahead. If Danielle Smith wants to go tell Alberta that she’s leaving federal money for health care on the table after they have been trounced by COVID, that might be something that’s really good for Rachel Notley on the campaign trail because she’d find a way to take the money. It might be really good politics in the end.

Q – Let’s look at some timelines. What are the milestones that we should be watching for that are going to be critical to this?

A – The federal government will issue a budget in the spring that will show some chunk of this. We’ll get some sense at least of the Canada health transfer aspect of it and maybe even more than that. Where they want to break down in terms of the provincial negotiations, you know, provinces are going to want to be able to put that money in their budgets fairly expediently, I would think. They’re not going to want to wait forever. On the one hand, a province might want to go back and forth a couple of rounds with the Prime Minister to make sure the feds know they’re not just going to take the first crappy offer you give us. The rules of negotiation apply here as they would in any other circumstance. However, a province is also keen to get the money in pocket, so you don’t want to dance around too long. I would say, over the next few months we might see some provinces who are inclined to participate and be on board. But, if I was a smaller Province, and I am from a smaller province, I’m from Nova Scotia, I would not be in a rush to side. I would hang back and see what Doug Ford gets and see what Legault gets and then say, “I’d like a piece of that, and our province is a smaller population, so surely if you can provide that benefit for them, you could provide it for us.” If I was a small province, I would hang back and see which way the wind is blowing.”