Federal Investments in Health Care
The federal government provided increased transfer support to provinces and territories primarily for health care and child care through three federal-provincial-territorial accords on health and early childhood development.
The September 2000 Agreements on Health Renewal and Early Childhood Development
The 2000 Agreement provided $23.4 billion in additional funding, including:
- $21.1 billion in additional Canada Health and Social Transfers (CHST) funding over five years, including $2.2 billion for early childhood development earmarked in the CHST;
- $1 billion over two years to provinces and territories in support of necessary diagnostic and treatment equipment;
- $800 million to provinces and territories support innovation and reforms in primary care;
- $500 million to Canada Health Infoway to help accelerate the adoption of modern information technologies to provide better health care.
First Ministers committed their governments to report regularly to Canadians on health status, health outcomes, and the performance of publicly funded health services, and the actions taken to improve these services.
The 2003 First Ministers’ Accord on Health Care Renewal
Building on the 2000 Agreements, in February 2003, the First Ministers' Accord on Health Care Renewal extended funding provided through the CHST, including scheduled increases, out to 2007-08 to improve the accessibility, quality and sustainability of the public health care system and enhance transparency and accountability in health care spending.
The 2003 Accord provided for federal support for health care to increase by $36.8 billion over the five-year period 2003-04 to 2007-08.
The majority of this funding, $31.5 billion, is being provided to provinces and territories through increased transfer payments, including:
- $16 billion over five years through a new Health Reform Transfer targeted to primary health care, home care and catastrophic drug coverage;
- $14 billion (including the $2 billion in additional funding announced in Budget 2004) for increases to health and social transfers (through the Canada Health and Social Transfer (CHST)); and
- $1.5 billion over three years to provinces and territories in a Diagnostic/Medical Equipment Fund in support of acquisition of equipment (and related specialized training) to improve access to publicly funded diagnostic services.
The federal government also provided $5.3 billion in supported federal direct initiatives under the 2003 Accord, such as increased funding for federal health programs for First Nations and Inuit, the creation of the compassionate care benefit under Employment Insurance, support for research hospitals, improved health care technology and pharmaceuticals management.
As part of the 2003 Accord, First Ministers also agreed to restructure the CHST effective April 1, 2004 to create two new transfers to improve the transparency and accountability of federal support to provinces and territories:
- The Canada Health Transfer (CHT) in support of health; and
- The Canada Social Transfer (CST) in support of post-secondary education, social assistance and social services, including early childhood development and early learning and child care.
A legislated five-year funding track for transfers in support of health and other social programs was put in place to 2007-08 as part of the 2003 Accord. As a result, total cash transfers grew to $28.1 billion in 2007-08 from $19.1 billion in 2002-03, including the Health Reform Transfer and the 2003 agreement on early learning and child care.
The 2003 First Ministers’ Accord also established an enhanced accountability framework under which all governments committed to provide comprehensive and regular reports to Canadians based on comparable indicators relating to health status, health outcomes, and quality of service. Governments also agreed to the establishment of the Health Council to monitor and make annual public reports on the implementation of the Accord, with an emphasis on its accountability and transparency provisions. This will allow Canadians to monitor progress toward reform, the level of access to health services and the overall efficiency of the health care system.
|Cumulative 5 Years
(2003-04 to 2007-08)
|Canada Health and Social Transfer (CHST)1||9.5|
|Health Reform Transfer2||16.0|
|2003 CHST supplement1||2.5|
|2004 CHST supplement for Health||2.0|
|Diagnostic/Medical Equipment Fund||1.5|
|Direct Health Accord Initiatives||1.6|
|Other Reform Initiatives||1.4|
|First Nations and Inuit Health||1.3|
|1 Transfers to provinces and territories were provided under the CHST up to 2003-04 and under the Canada Health Transfer (CHT) and the Canada Social Transfer (CST) for 2004-05 and beyond.
2 The Health Reform Transfer was incorporated into the Canada Health Transfer effective April 1, 2005. All amounts are increases relative to 2002-03 levels. Totals may not add due to rounding.
|CHST Increases||Health Reform Transfer||2003 CHST Supplement||2004 CHST Supplement for Health||Diagnostic/ Medical Equipment
|Totals may not add due to rounding.|
|Newfoundland and Labrador||16.4||24.3||55.7||70.4||85.2||252.0|
|Prince Edward Island||4.3||6.5||15.0||19.1||23.2||68.1|
|1 Under the 2004 10-Year Plan to Strengthen Health Care, the Health Reform Transfer was incorporated into the Canada Health Transfer effective April 1, 2005. Totals may not add due to rounding.|
|Newfoundland and Labrador||16.8||16.6||8.2||41.6|
|Prince Edward Island||4.4||4.4||2.2||11.0|
|1 Under the 2003 Accord, the 2003 CHST supplement was apportioned between the Canada Health Transfer and the Canada Social Transfer effective April 1, 2004.
Based on notional allocation schedule of trust fund. Provinces and territories had the flexibility to draw down funds as they required up to the end of 2005-06. Totals may not add due to rounding.
|Newfoundland and Labrador||16.3||16.2||32.4|
|Prince Edward Island||4.3||4.3||8.7|
|Based on notional allocation schedule of trust fund. Provinces and territories had the flexibility to draw down funds as they required up to the end of 2005-06. Totals may not add due to rounding.|
|Newfoundland and Labrador||8.4||8.3||8.2||24.9|
|Prince Edward Island||2.2||2.2||2.2||6.6|
|Based on notional allocation schedule. Provinces and territories had the flexibility to draw down funds as they required up to the end of 2005-06. Totals may not add due to rounding.|
The September 2004, 10-Year Plan to Strengthen Health Care
The 2004 10-Year Plan to Strengthen Health Care extended funding commitments in the 2000 and 2003 health accords and increased cash transfers to provinces and territories for health care over 10 years. This included:
- Establishing a new CHT base of $19 billion in 2005-06 and applying a six per cent annual escalator effective 2006-07;
- $5.5 billion over 10 years through the Wait Times Reduction Fund and the Wait Times Reduction Transfer to assist provinces and territories in their respective strategies to reduce wait times; and
- $500 million in 2004-05 for additional investments in medical and diagnostic equipment.
In addition, the legislation to implement the funding commitments of the 10-Year Plan provided for a Parliamentary review in 2008 and 2011 on progress achieved in implementing the 10-Year Plan.
First Ministers agreed to collect and provide meaningful information to Canadians on progress made in reducing wait times, including the establishment of comparable indicators of access to health care services and evidence-based benchmarks for medically acceptable wait times.
Budget 2007 Targeted Investments
In addition to the 10-year Plan to Strengthen Health Care, Budget 2007 took action to help reduce wait times and to modernize Canada’s health system through targeted investments:
|Newfoundland and Labrador||10||5.9||5.9||5.9||17.7|
|Prince Edward Island||10||4.0||4.0||4.0||12.1|
|Note: Base funding of $112 million was allocated over 3 years, $10 million per province and $4 million per territory; remaining funding of $500 million was allocated on an equal per capita basis over three years. Totals may not add due to rounding.|
|Newfoundland and Labrador||1.5||1.5||1.5||4.6|
|Prince Edward Island||0.4||0.4||0.4||1.3|
|Note: Based on equal per capita allocation. Totals may not add due to rounding.|