Health talks fail despite federal pledges of more cash for home care, mental health
Home care and mental-health services targeted but more wanted for other costs.

TheStar.com
Dec. 19, 2016
Bruce Campion-Smith

Ottawa has failed to reach agreement with the provinces on a new health funding accord, despite the promises of big investments to improve mental health and home care services.

A day of meetings between federal Health Minister Jane Philpott and Finance Minister Bill Morneau and their provincial counterparts wrapped up Monday with no deal and not even the promise to meet again.

The federal government had gone into the meeting pledging extra funding earmarked for mental health and home care — two priorities flagged by the Liberals in the last election.

And during the day, the Liberal government sweetened the pot, pledging a total of $11 billion over 10 years for those two areas, plus another $544 million for initiatives on prescription drugs and health innovation.

“We’re disappointed. We put a significant offer on the table to the provinces . . . we were unable to get to a conclusion,” Morneau told reporters after the meeting ended.

Asked to explain why there was no agreement, he said, “We know provinces do want to find ways to improve their fiscal situation. . . . The provinces were seeking more money.”

Indeed, agreement foundered over the federal health transfer. It’s been rising by 6 per cent a year since 2005 but that is set to drop next April to 3 per cent or the rate of nominal GDP, whichever is higher.

The federal government has proposed a yearly increase of 3.5 per cent, below the 5.2 per cent sought by the provinces. The difference the two proposals is worth $30 billion to the provinces, Ontario Finance Minister Charles Sousa said.

Sousa said Ottawa’s current offer would reduce federal share of health funding to 20 per cent, down from 23 per cent now. “They’re actually cutting funding over time, relative to what’s required,” he said.

“The demands upon us (are) even going to increase over time. We need the federal government to recognize that,” Sousa said.

The Ontario finance minister was critical of the agenda laid out by the federal Liberals, bluntly saying “they’re sacrificing health care in support of other priorities.”

Provincial officials were unhappy even before the meeting began, chafing at what they branded as Ottawa’s “arbitrary” deadline and rejecting a “take it or leave” offer on health-care funding.

The provinces are now demanding a meeting between the premiers — who were consulted in a teleconference Monday — and the prime ministers on the issue.

Morneau said Monday’s offer is now off the table and cast doubt on whether any extra health funding will be in the spring budget, beyond the 3 per cent increase that will take effect in the absence of a deal.

But he was also at a loss to explain how the Liberals could make good on their election vow to improve health care without the assistance of the provinces.

“We don’t have a full sense yet of what our next steps will be,” Morneau said.

Philpott had boasted about the federal proposal, calling it a “transformative, historic offer. We’re changing the face of health care.”

She also defended earmarking funds for mental health and home care, saying that past experience has shown that blanket spending increases rarely produce the kind of changes the health-care systems needs. While she praised Canada’s health system, she pointedly noted that “care could be more efficient.

“There’s no question that there can be improvements in the system,” Philpott said.

But her provincial counterparts mocked her claims, saying that unless Ottawa agreed to sweeten its offer, the federal government’s contributions to health care would actually decline and with it, the services provided to Canadians.

At the end of the 10-year deal, Ottawa’s offer would mean “less care for vulnerable Canadians, less access, less funding,” said Quebec Health Minister Gaétan Barrette.