COVID-19 will force feds to reconsider health-care funding, Trudeau says

OTTAWA — Prime Minister Justin Trudeau says the government will have to consider increasing health-care funding after seeing the toll the novel coronavirus has taken on the country.

Before the pandemic hit, the federal government was set to open discussions in May with provinces and territories about transfer payments for health care.

Those discussions have since been put off to focus on the more urgent concern of COVID-19.

“We will, of course, be there to have conversations about increasing supports to the provinces for health care,” Trudeau said Friday in Ottawa outside his residence at Rideau Cottage.

“We’ve seen significant needs on health care across the country.”

Health spending as a share of Canada’s gross domestic product has generally trended upward for the last 40 years, with provinces and territories spending about $172 billion in 2019, according to estimates by the Canadian Institute for Health Information.

It’s the single-largest spending item in all provincial and territorial budgets.

A recent analysis by the Institute of Fiscal Studies and Democracy at the University of Ottawa concluded that health-care spending would quickly become unsustainable for provinces.

“Demand for health care has been increasing because of the aging of the population and advancement’s in medical technology. These trends are expected to continue in the future,” said Mostafa Askari, chief economist for the institute, wrote in the report.

As those costs go up, federal transfer payments have not kept pace, the report said, which means provinces are covering more and more of the costs.

The report concluded that provinces had to find a way to make health spending more efficient, but acknowledged there are limited ways for them to accomplish that. 

“Given the challenge facing the governments, it may be time for a review of the Canada Health Act,” Askari wrote.

Making sure seniors are well cared for is top of mind in any future spending increases to support provincial health systems, Trudeau said.

“Obviously, all Canadians are asking themselves questions about the situation that has allowed so many of our elders to be so incredibly vulnerable to COVID-19 and related issues,” he said.

“We need to do better and we will be working with the provinces on ways to move forward.”

Deputy Prime Minister Chrystia Freeland said there will be no quibbling about jurisdictional spending between the federal and provincial governments during the crisis, and all have agreed not to worry about who will be picking up the bill.

“We are still in a situation where our house is on fire and all of us need to be really, really focused on putting the fire out,” Freeland said Friday.

The pandemic is teaching them several lessons they will take into future discussions though, she said.

“Collectively we need do a much better job of caring for our elders,” said Freeland.

This report by The Canadian Press was first published April 24, 2020.

Laura Osman, The Canadian Press