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Canada, playing catch-up, enters its own ‘decisive decade’ with China


At a Glance

  • Canadian allies in the region have been generally pleased with Canada’s plan and some international experts have lauded the new tone.
  • The plan promises $2.3 billion over five years in an attempt to build relationships in the region by expanding trade and boosting Canada’s military capacity.
  • “The strategy has come too late and Canada is playing catch up to its closest democratic allies,” said Conservative MP Michael Chong.

The new Indo-Pacific strategy unveiled by the Liberal government on Sunday, featuring harsher language and blunt criticisms of China, could mark a new era for Canada’s presence in the region after years of being “basically irrelevant,” experts say.

“Especially on the China front, people are impressed that Canada went as far as it went on this,” said Jonathan Berkshire Miller, the director of the Indo-Pacific program and senior fellow at the Macdonald-Laurier Institute.

“Going into this, I think that we’ve been really slow, not just on China, but more broadly, in the region. We haven’t been serious and it’s left us to be seen as basically irrelevant to a lot of these countries in the region,” said Miller.

Miller cautioned that a strategy is only as good as the implementation of it, and said he’ll be watching carefully for how the government rolls it out. But in early conversations with Canadian allies in the region, Miller said people have been generally pleased with Canada’s plan and some international experts have lauded the new tone in the strategy, which dubbed China a “disruptive” force.

“Canada’s new Indo-Pacific strategy represents an important step forward. It begins to bring Ottawa’s policies into line with the increasingly evident reality that China is an exceptionally powerful, ambitious, and aggressive state that needs to be dealt with as it is, not as we might wish it to be. This means dispensing with the optimistic policies of the past,” said Elbridge Colby, the former U.S. deputy assistant secretary of defense for strategy and force development, in an interview with The Hub on Monday.

“Canada’s shift is therefore important. But it is unlikely to be the end of the story as we enter what the Biden Administration itself calls ‘a decisive decade’ with China,” said Colby.

The strategy promises $2.3 billion over five years in an attempt to build relationships in the region by expanding trade and boosting Canada’s military capacity. The plan follows an increasingly hard-line on China from U.S. President Joe Biden, who has overseen several diplomatic skirmishes with China since taking office. Last month, Biden announced a sweeping expansion of its export controls on semiconductor chips to China, an escalation in a long-simmering competition between the two countries.

In August, U.S. Speaker Nancy Pelosi became the most senior U.S. politician to visit Taiwan in 25 years and declared that the U.S. would not abandon Taiwan, sparking a furious response from China.

Biden and Chinese President Xi Jinping held a long bilateral meeting at last month’s G20 summit in an attempt to clear the air, but some experts think the two countries are inevitably diverging, with allies following.

“Every country in the world is increasingly being forced to choose sides. And it’s a sad reality of the world that we live in today,” Isaac Stone Fish, a scholar and former Beijing correspondent for Newsweek, in an interview earlier this year with The Hub.

“Canada gains little from acting as a wedge issue between the United States and China or figuring out where it can work with China that the United States can’t,” he said.

The government’s Indo-Pacific plan has been years in the making, even while Beijing detained two Canadian citizens in China, Michael Spavor and Michael Kovrig, sparking a nearly three-year diplomatic crisis.

“The strategy has come too late and Canada is playing catch up to its closest democratic allies,” said Conservative MP Michael Chong, who is the party’s foreign affairs critic.

“This was an announcement of a strategy and what will be critical for the government is implementing the strategy. This is a government that has not been good at implementation. They’ve been great at announcements but weak on implementation, and there’s a whole range of files where you can point to this,” said Chong.

The plan also includes funding for items like business grants and visa processing, a sign that Canada is interested in building allies around China in the region.

“I think Canada clearly understands that we alone are too small to have any impact. So there is greater coordination with allies, firstly in the Indo-Pacific region, and the United States is a Pacific country just as we are,” said Janice Stein, from the Munk School of Global Affairs and Public Policy at the University of Toronto.

The document should be read as a serious effort to engage with the rest of the Indo-Pacific region, rather than just a China strategy, said Stein.

“These partners make it clear repeatedly in the statements that they make, that they don’t want to be forced to choose between the United States and China, but they too have security concerns,” said Stein.

“They have concerns about the way China is behaving in their neighbourhood. So the more governments can do two things at the same time, the broader support that will be and that’s what the strategy really expresses,” said Stein.

David Mulroney, Canada’s former ambassador to China, wrote on Twitter that Canadians shouldn’t lose sight of the fact that China has been accused of forming an “interference network” during the 2019 election.

“They do want us to believe that our focus should be out there in the Indo-Pacific, rather than back here in Canada. They’ve no plan to combat increasingly sophisticated Chinese interference. Just the desire to get it out of the headlines,” wrote Mulroney.

Mulroney said that without a concrete plan to look into this kind of interference in our democratic institutions, the plan can’t be taken seriously.

“In a few weeks, if not days, Canada’s Indo-Pacific ‘strategy,’ a grab-bag of expenditures looking for a purpose, will be forgotten. No big deal. But we can’t afford to forget an interference campaign so blatant the PRC no longer even tries to hide it,” he wrote.

With files from Geoff Russ

Medicare Meltdown: The Canada Health Act is failing Canadians


Canada’s health-care system is under siege. The country is still grappling with an acute crisis in our hospitals stemming from the COVID-19 pandemic while the slow-moving quagmire caused by the country’s aging population threatens to become a larger disaster. Can our system handle it? This joint five-part Medicare Meltdown series produced by the National Post and The Hub looks deep into the world of Canadian health care, not just to identify problems, but to offer solutions for the future.

In 1999, an Ipsos poll revealed a startling fact about Canadians. Amid a general sense of optimism about the country’s ability to handle medical emergencies, concern about a declining standard of health care, and debate over whether public health needed more money or just more oversight of the money it already had, only 42 percent of respondents had even heard of the Canada Health Act, the legislative basis for the very system being discussed.

That did not stop those who had just learned about its tenets from having “distinct opinions.”

Has awareness of the CHA improved? It’s hard to say. We’re certainly awash in statistics and opinions about the health-care system the CHA produced. Broad majorities of Canadians agree that the system is both satisfactory and in need of improvement. We are both proud and supportive of its public ethos but curious about the possibilities of private alternatives. In American media, Canada is alternatively a roadmap, a utopia, or a nightmare. Canadian health care is a chimera, letting you see what you want to see.

But when the CHA itself comes up—and it’s rare that it does—it’s almost treated as an ancillary document. A 2020 poll found that 86 percent of Canadians want the CHA expanded to include long-term care facilities, but similar support for expanded public coverage of LTC can be found without mentioning the CHA at all. In casual conversation, “health care” and the CHA are essentially synonymous.

And so while there are periodic calls to either expand the CHA or scrap it and let the market have a say, discussions of health-care reform rarely account for what the CHA actually allows the government to do. Where has the text of a 38-year-old document brought us? How can the CHA be updated to improve public health care? And how do we divorce the pride and politics Canadians put into health care from the CHA itself?

“I think Canadians believe the CHA gives them a right to health care,” says Colleen M. Flood, a University of Ottawa law professor and CHA expert who’s written extensively about modernizing the Act. “Technically it doesn’t. It is a way for the federal government to transfer money to the provinces. No Canadian has a right, under the CHA, to health care. However, normatively it has become such a value for Canadians. Politicians get in trouble if they suggest they’re going to make people pay out of pocket. Canadians believe it’s a right, and so it’s kind of become a right.”

How did we acquire this pseudo-right, and how well is it holding up today?

Let’s start with a short history lesson, just in case public knowledge hasn’t improved since that 1999 poll.

Adopted in 1984, the CHA is a successor to 1967’s Medical Care Act and 1957’s wordy Hospital Insurance and Diagnostic Services Act. HIDS essentially took the precepts of Saskatchewan’s ground-breaking Hospital Services Plan, which provided government coverage to a public reeling from depression and war, and scaled it up to a national level, reimbursing provinces for half the money their insurance programs spent on hospital and diagnostic services. While now seen as part of our national identity, at the time it was contentious.

“The physicians really resisted it,” Flood says. “They fought tooth and nail to stop it. The accommodation reached was: ‘The government can pay our bills, but keep the hell out of our business.’ The system is organized for the convenience of the health care providers, not the patients.”

Another, and even wordier act, was issued in 1977, a tweak that swung the pendulum in the opposite direction. With Ottawa now having almost no ability to enforce the ideals of universal accessibility, provinces began dabbling with user fees. The problems that followed led to the CHA, which stabilized and clarified the financial relationship between the federal government and the provinces.

In theory, the provinces are under no obligation to adhere to the CHA, but Ottawa can cut funding if provincial health care fails to live up to the principles codified in the Act including accessibility and universality.

While the CHA has been a stable provider of health care, there’s a fundamental tension in a system where one party provides funding and another party spends it. This, as Flood points out, leads to “splintered accountability.”

“I think the basic problem in Canadian health care is that when we think about the issues it has, do we blame the federal government, or do we blame the provincial government?” Flood says. “This confusion allows both levels of government to get away with not doing a good job.”

This problem predates the CHA, but the CHA did little to address it.

“The CHA is perhaps a symbol of the difficulty of deciding who is responsible for the health-care systems in Canada,” Flood says. “The federal government and the provincial government both have jurisdiction, but the provincial governments have been interpreted to have more jurisdiction over the delivery of health care, physicians, hospitals, and so on. The federal government provides funding and has tried to generally set goals. This is a tricky dance.”

As health care costs creep upwards, federal contributions aren’t keeping up.

“The provinces feel that the feds don’t live up to their side of the bargain. The federal share has dwindled significantly, while total health-care spending has gone up. But the federal government feels that when they try to put new money in to improve wait times or fix homecare, the provinces just throw that money into the general coffers and no improvements happen. So we have a standoff, and the public pays for it.”

While the passing of the CHA was a landmark in Canadian history, it’s becoming harder to ignore its two glaring flaws. First, the CHA lacks the teeth to enforce accessibility standards on the provinces, and the federal government has been hesitant to bite with the few teeth it does have. Second, what we consider health care has changed significantly since the CHA’s roots were planted in the ‘60s.

The CHA promises reasonable access to hospitals and physicians, but “reasonable” is open to interpretation. At a time when almost 15 percent of Canadians don’t have access to a family doctor, however, it would be, well, reasonable to argue that the provinces aren’t living up to their end of the bargain.

“The problem is that the federal government doesn’t really enforce those provisions of the CHA,” Flood says. “They don’t hold back money from the provinces who aren’t making sure there’s reasonable access. They’ve kind of lost their moral legitimacy to do this because they’re no longer contributing 50 percent. The provinces seem to think it’s fine that so many people wait too long for a surgery, they’ll always say ‘Well, we don’t have the federal funding.’ So you’ll always have this finger pointing.”

That finger pointing, empowered by the vagueness of the CHA, keeps us from having essential data and delineated responsibilities.

“The other really important thing that’s missing from the CHA is the ability to figure out how to make the federal and provincial governments accountable for what they do. For example, clear reporting on wait times. The system needs to make sure that no one is left waiting too long.”

The enforcement powers Ottawa does have are less a slap on the wrist than a grenade. The federal government can cut funding to provinces, but when your only option is to turn the tap off and force yourself to deal with the political fallout of that decision, it’s no wonder that Ottawa largely overlooks violations of our supposedly sacred duty to universal access.

“The only place the CHA has some real teeth is around extra billing and user fees,” Flood says. “Under the CHA, the federal government has to withhold dollars from provinces that implement them. When the Conservatives were in power they mostly ignored that; the Liberals sort of enforce it from time to time. The problems of accessibility and reasonable access aren’t enforceable. It’s completely at the discretion of the federal government whether it withholds money, and they’ve never withheld money because of any other criteria. The only criteria they’ve ever enforced are extra charges.”

This has led to calls, as discussed below, for more federal intervention in provincial health-care systems, including greater conditionality on federal funding. There are voices, however, who argue for precisely the opposite: that is to say, that intergovernmental ambiguity caused by the CHA (and the Canada Health Transfer that it governs) has become a barrier to progress. Take former Saskatchewan NDP finance minister, Janice MacKinnon, for instance. In her re-telling of her experience in provincial government in the early 2000s, an infusion of federal dollars with greater strings attached essentially bought stasis. “The money did not go to change,” MacKinnon said in a 2015 video for the Macdonald-Laurier Institute.

When HIDS was introduced in 1957, pharmaceutical medicine and mental health care were in their infancy, and eldercare was considered a family duty. The link between smoking and lung cancer had just been established, beta blockers had yet to be introduced, and even Ibuprofen wasn’t on shelves. Health care was viewed solely as the domain of hospitals and physicians, and that view hadn’t changed by the time the CHA rolled around in the ‘80s.

“The CHA is a creature of its time, but there are clearly other things that are really important too,” Flood says. “We’ve learned more about, say, the role of basic dental care in relation to cardiovascular disease. Long-term care, homecare: these have become much more important than they were in the ’60s. There’s no mechanism inside the CHA that refreshes the basket of services covered.”

This means the government will happily fund your bunion removal, but you’re on your own when it comes to paying for insulin. That makes adding pharmacare or mental health coverage to the CHA, as is sometimes proposed, a dubious prospect. There’s nothing in the CHA to stop a pharmacare program, but there’s nothing in it to enforce an effective one either.

“You could certainly expand it to include pharmaceuticals, but the provinces would be very nervous about doing that,” Flood says. “The federal government would have to sign in blood somehow that they’d always be paying a very robust share of the cost. Provinces might want to run their own pharmaceutical system, or ideologically they might not want to provide universal coverage.”

Any new public health programs are therefore unlikely to be amendments to the CHA but instead, as Flood calls them, “their own beasts.” While new legislation is theoretically a viable path forward for pharmacare, dental care, and other aspirational programs, Ottawa has instead, essentially, been cutting deals.

“What we’ve been seeing in recent years is the federal government not legislating, but negotiating separate side agreements with the provinces. I see why they’re depoliticizing it, but the public doesn’t really know what we’re getting. In the deal with New Brunswick for homecare, what did we actually get?”

The CHA’s outdated conception of health-care services has led to a public insurance model that The Hub’s editor at large Sean Speer has described as a “mile deep and an inch wide.” There’s a policy case that it’s produced an inegalitarian system in which first-dollar public coverage is provided for hospital and physician services irrespective of one’s means and then there’s little public support for other services such as drugs, dental and long-term care which increasingly make up a major share of overall health-care expenditures in the country. The solution, according to Speer, isn’t to expand the single-payer model but rather to rationalize it based on need.

It can be easy to dismiss all of this as an abstraction. While the CHA is an important normative document, how closely are our health care struggles really connected to its ideals? But the latest decision in the interminable Cambie saga is illustrative of how reality collides with vision.

Cambie Surgeries Corporation v. British Columbia is also, perhaps, the perfect summation of why our health care woes are difficult to discuss. It’s a complicated and technical case that has taken years to unravel, defying easy and accessible media coverage. Cambie’s Dr. Brian Day recently lost in the B.C. Court of Appeal, but the case is expected to wend its way to the Supreme Court for a final ruling that could reinforce—or overturn—decades of Canadian health care mores.

Dr. Day’s Cambie Surgery Centre had challenged B.C.’s Medicare Protection Act with the goal of overturning the prohibition on private insurance for procedures covered by the province’s Medical Services Plan (such as colonoscopies and orthopedic surgeries), as well as the prohibition on billing patients above the rate prescribed by the MSP. Cambie’s argument centred on the claim that an inability to give patients shorter wait times by billing them privately violated their Charter Rights to “equality” and “life, liberty and security of the person.”

The Supreme Court of British Columbia ruled against Cambie by finding that the claimed Charter violations weren’t sufficiently demonstrated, and that any suffering eased by letting Cambie’s patients jump the public queue would be offset by the knockoff effect on the public system. While the B.C. Court of Appeal showed more sympathy to the Charter argument, it also ruled that Canadians have no constitutional right to private care.

“If the CHA were to become unenforceable, there would be profound implications for the rest of Canada.”

Simon Fraser University professor Karen Palmer says that case challenges the B.C. Medicare Protection Act, not the CHA. But it could dramatically undermine the CHA.

“The CHA is really the heart and soul of Medicare. So if the Supreme Court were to reverse the appeal court’s decision, and the provisions of the B.C. MPA were deemed unconstitutional, the implications for the CHA are unclear. And if the CHA were to become unenforceable, there would be profound implications for the rest of Canada.”

Palmer, a health policy analyst who consulted for the Attorney-General of British Columbia during Cambie’s first crack at the courts, believes that “if and until the Supreme Court agrees to hear the case, I expect other clinics will push the boundaries. They’ll continue to walk that line.”

Cambie has drawn some comparison to Quebec’s Chaoulli ruling, which opened the door to private duplicative insurance for hip, knee, and cataract surgery. But such a small market, and one limited further by Bill 33 preventing physicians from working in the public and private pay system simultaneously, has kept Chaoulli from having a national impact.

“There are all sorts of gaming of the system that goes on in Quebec, it’s very difficult to regulate and manage,” Palmer says. “But there is no private insurance market that emerged, it’s not a big enough fish. If it were to be the case in B.C. and to continue across the country then the health-care system, as we know it, could be at risk.”

Speer broadly agrees with this characterization but disagrees that it’s inherently problematic. If the Supreme Court was to rule in favour of Cambie, it could be a catalyst for a much-needed conversation about the relative roles of the public and private sectors in the financing and delivery of health care in Canada. “The CHA has, in my view, become an impediment to an adult conversation about health care. It would be helpful in the long-term if a Cambie decision produced such a conversation,” he says.

Cambie, in addition to seeking an end to the prohibition on duplicative insurance, is hoping to upend the ban on extra billing, which would allow patients to be billed as much as the market would bear, and the ban on dual practice, which would let physicians bill patients, private insurers, and B.C.’s medical services plan. Currently, you are welcome to run a private clinic that bills whatever is deemed appropriate, but you cannot simultaneously be enrolled in the public system, seeing public patients, and drawing from the public purse.

Cambie’s goals are broad and have the potential to create a parallel private pay system in B.C. if the Supreme Court finds its arguments palpable. To be seeing public and private patients simultaneously would be a challenge to the CHA’s accessibility clause.

The federal government has all the money but the provinces have all the responsibility of spending it; it’s a classic recipe for dysfunction.

“How do we get there? It’s a real challenge,” Flood says. “The CHA worked really well for a couple of decades. But the wheels are starting to come off, and we need to figure out structures and mechanisms to focus on higher quality access to health care.”

There are improvements the provinces could make right now. Setting transparent wait time targets, providing relief to patients lost in the system, having a patient health ombudsman. These are ideas that, as Flood points out, would require little legislative finagling.

“Why don’t provinces do this on their own? It’s actually unbelievable that this isn’t much more of an election issue, even though Canadians are all individually quite worried about the health-care system it isn’t something they really vote on at provincial elections. Again, I think it’s splintered accountability.”

And so we’re stuck in a rut. With no real electoral pressure to make improvements, provinces can blame health care problems on a lack of federal money. But while more federal money could help, Ottawa has no guarantee that it would be spent properly. The question, Flood says, is “What kind of structures and mechanisms need to be put in place so that the provinces feel all empowered and happy, but we actually get what we need?”

In theory, a new document to replace the Canada Health Act could be introduced to meet the demands of the 21st century. Here’s what a more robust and effective power-sharing deal could and should look like:

First, Flood suggests a self-refreshing document. Much as a private insurer routinely revisits and revises their list of insured services, public care needs to adapt to new developments and wants. The CHA has no mechanism for reconsidering what constitutes health care, and by locking our view of health in the amber of 1984 it’s difficult to adjust to what the public asks for and what experts say we need. A transparent panel of academics and clinicians run by provinces as a requirement for receiving funding could be one way to keep services relevant.

“If we were [writing the CHA] today, we would probably not fund some doctor services, some hospital services, and we would probably fund more prescription drugs and dentistry, basic vision care,” Flood says. “The funny thing about the CHA is that ‘medically necessary’ and ‘medically required’ aren’t defined. It’s up to the province, and that’s really just a matter of what the billing schedule is that they figure out with physicians. There’s no real science in it.”

There is also the question of implementation. The CHA’s current ideals of accessibility and universality are an essential element of Canadian identity, but effectively unenforceable. One approach would be to establish an independent agency to monitor the provinces.

There are however those who argue for essentially the opposite. Speer, for instance, believes that the federal role in health care should be significantly curtailed through changes to our system of fiscal federalism in which the federal Goods and Services Tax would be downloaded to the provinces and territories in exchange for eliminating the Canada Health Transfer and most parts of the CHA. The principle of portability would have to be protected, according to Speer, but otherwise the provinces and territories would be free to decide how to structure their insurance models and health-care delivery. “Let a thousand flowers bloom,” says Speer.

“Every Canadian should have some kind of access to primary care,” Flood says. “There must be a mechanism to achieve that. Be transparent, show us what’s actually happening at the provincial level to improve access as promised under the CHA.

She adds: “Just doing nothing is terrible.”