The Canada Health Act (CHA; ), adopted in 1984, is the federal legislation in Canada for publicly-funded health insurance, commonly called "medicare", and sets out the primary objective of Canadian healthcare policy.
As set out in the Act, the main objective of healthcare policy in Canada is to facilitate reasonable, continued access to quality healthcare to all Canadians, regardless of income or geographic location by establishing criteria and conditions in respect of insured health services and extended health care services.
The statute establishes the framework for federal financial contributions to the provincial and territorial healthcare insurance programs under the Canada Health Transfer. With that said, the CHA deals only with how the system is financed: under the constitutional division of powers in Canadian federalism, adherence to Canada Health Act conditions is voluntary on the part of the provinces/territories; the federal government cannot compel the provinces to comply with the Act. However, if a province does not comply with the terms, it would not receive the federal financial contribution to healthcare. Those fiscal levers have helped to ensure a relatively consistent level of coverage across the country.
Establishing the principle of universal, single-payer healthcare, the Act's basic requirement is universality: to qualify for federal funding, provinces and territories must provide universal coverage of all "insured health services" for all "insured persons." "Insured health services" include hospital services, physician services, and surgical-dental services provided to insured persons, if they are not covered by any other programme. "Insured persons" means anyone who is resident in a province or territory and lawfully entitled to be or to remain in Canada.
Governments' fiscal position will influence health spending trends. , Canada’s per capita spending on healthcare was among the highest internationally, placing Canada above the OECD average in terms of per-person spending on healthcare. However, Canada's healthcare spending per capita is less than 60% of its neighbour's, the United States. In addition, prior to the COVID-19 pandemic health spending growth was constrained due to federal and provincial/territorial governments running budget deficits. In 2005, international data shows that approximately 70% of Canadian health expenditures were paid from public sources,. thereby placing Canada below the OECD average..
Overview
Bill C-6 was introduced in the House of Commons by federal Minister of Health Monique Bégin in December 1983. The bill passed unanimously in the House of Commons in April 1984, and received royal assent 8 days later. The Canada Health Act was thereby enacted in 1984. It has since been included in the Revised Statutes of Canada 1985, and is now cited to the Revised Statutes.
As Bégin noted, the government decided not to expand coverage (e.g., to mental health and public health), but instead to incorporate much of the principles from previous federal legislation, the Hospital Insurance and Diagnostic Services Act and the Medical Care Act, which were then repealed by the Canada Health Act.Monique Begin. Medicare: Canada's Right to Health. 1988
Following the election of the Brian Mulroney government in September 1984, the new health minister, Jake Epp, wrote a letter in June 1985 to the provincial health ministers that clarified and interpreted the criteria points and other parts of the new act.
The Canada Health Act sets out the main objective of healthcare policy in Canada, which is "to protect, promote and restore the physical and mental well-being of residents of Canada and to facilitate reasonable access to health services without financial or other barriers."
The CHA establishes criteria and conditions related to insured health services and extended health care services that provincial and territorial governments must fulfill in order to receive the full federal cash contribution under the Canada Health Transfer (CHT). With that said, under the constitutional division of powers in Canadian federalism, adherence to Canada Health Act conditions is voluntary on the part of the provinces/territories; the federal government cannot compel the provinces to comply with the Act.
One cause for debate is the scope of what should be included as "insured health services". For historical reasons, the Canada Health Act definition of insured health services is largely restricted to care delivered in hospitals or by physicians. As care has moved from hospitals to home and community, it increasingly has been moving beyond the terms of the Canada Health Act. However, health insurance covers surgery and services, including psychotherapy, in clinics and doctors' offices as well as dental surgery at dental offices and laboratory tests.
Conditions and criteria In order to receive federal funding, there are five principal requirements that provincial and territorial plans must be based on:
public administration comprehensiveness universality portability accessibility.
There are also two secondary conditions:
recognition: the provinces and territories must ensure recognition of the federal payments; and information: the provinces and territories must provide information on the operation of their health systems to the federal government.
Criteria
Public administration The health insurance plans must be:
administered and operated on a non-profit basis by a public authority responsible to the provincial/territorial governments subject to audits of their accounts and financial transactions. This condition does not deal with healthcare delivery, but rather with the system to pay for healthcare. It is the basis for single-payer medicare. It reduces the scope for private insurers to cover insured health services (although they are still able to cover non-insured health services or non-insured persons).
Comprehensiveness The provincial/territorial healthcare insurance plans must cover "all insured health services provided by hospitals, medical practitioners or dentists" under section 9.
Section 2 defines what is meant by insured health services. In general, this retains the restriction to hospital and physician services arising from the earlier legislation. The provinces are allowed, but not required, to insure additional services.
Notably, the Canada Health Act refers to "surgical dental services" but only if these must be provided within a hospital. In practice, this almost never occurs, and the annual health expenditure data published by the Canadian Institute for Health Information (CIHI) confirm that Canadian dental services are almost entirely financed privately. Lobbying by other providers, including nurses, led the act to speak of 'practitioners' rather than physicians; physician services had to be covered, but provinces were allowed, but not required, to define other health professions as qualifying under the Canada Health Act. To date, this provision has been used only occasionally; for example, some provinces have added midwifery, which means that their services are also fully publicly paid for.
Universality All insured persons must be covered for insured health services "provided for by the plan on uniform terms and conditions." This definition of insured persons excludes those who may be covered by other federal or provincial legislation, such as serving members of the Canadian Forces or Royal Canadian Mounted Police, inmates of federal penitentiaries, persons covered by provincial workers' compensation, and some Indigenous peoples. Some categories of resident, such as landed immigrants and Canadians returning to live in Canada from other countries, may be subject to a waiting period by a province or territory, not to exceed three months, before they are classified as insured persons; this waiting period arises from the portability provisions.
Portability
Because plans are organized on a provincial basis, provisions are required for covering individuals who are in another province. The conditions attempt to separate temporary from more permanent absences by using three months as the maximum cut-off. As the above-mentioned summary clarifies, "Residents moving from one province or territory to another must continue to be covered for insured health care services by the "home" province during any minimum waiting period, not to exceed three months, imposed by the new province of residence. After the waiting period, the new province or territory of residence assumes health care coverage." The portability provisions are subject to inter-provincial agreements; there is variation in what is considered emergency (since the portability requirement does not extend to elective services), in how out-of-country care is covered (since there is no 'receiving' province), in how longer absences are dealt with (e.g., students studying in another province), whether the care will be paid for at home province or host province rates, and so on.
Accessibility Finally, section 12(a) stipulates that the insurance plan must provide for "reasonable access" to insured health services by insured persons, "on uniform terms and conditions, unprecluded, unimpeded, either directly or indirectly, by charges (user charges or extra-billing) or other means (age, health status or financial circumstances)."
This section also provides for "reasonable compensation for...services rendered by medical practitioners or dentists" and payments to hospitals that cover the cost of the health services provided. Neither reasonable access nor reasonable compensation are defined by the Canada Health Act, although there is a presupposition that certain processes (e.g., negotiations between the provincial governments and organizations representing the providers) satisfy the condition. The Canada Health Act allows for dollar-for-dollar withholding of contributions from any provinces allowing user charges or extra-billing to insured persons for insured health services. As noted below, this provision was effective in 'solving' the extra-billing issue.
Conditions Section 13 lists two conditions that must be met by the province/territory in order to receive its full share of the federal transfers.
The first condition is that the federal minister of health is entitled to specific information relating to a province's insured and extended health care services. This information is used in drafting annual reports, presented to parliament, on how the province administered its health care services over the previous year.
The second condition is that the province must "give recognition" to the federal government "in any public documents, or in any advertising or promotional material, relating to insured health services and extended health care services in the province".
Violations and penalties
In order to document compliance with the Canada Health Act, the federal minister of health reports to the Parliament of Canada each year on how the law has been administered by each province over the course of the previous fiscal year.
For non-compliance with any of the five criteria listed above, section 15 allows the federal government to withhold all or a part of the transfer payment with "regard to the gravity of the default". Thus far all non-compliance issues have been settled through discussion or negotiation. Some argue that the federal government has not actively attempted to enforce these conditions, with particular concerns about handling of portability (e.g., the reduction of coverage for residents while traveling abroad) and comprehensiveness (e.g., de-insuring of some medical procedures).
In accordance with section 20, if a province were to violate the prohibition on extra-billing or user charges, the corresponding amount of that collected would be deducted from the transfer payment.