Proceedings of the Standing Senate Committee on
Social Affairs, Science and Technology

Issue 16 - Evidence

The Standing Senate Committee on Social Affairs, Science and Technology met this day at 3:30 p.m. to examine the state of the health care system in Canada.

Senator Michael Kirby (Chairman) in the Chair.

[English]

The Chairman: Before resuming our hearings on our study on the state of the health care system in Canada and what needs to be done to it or for it, depending on your point of view, we have one motion that we need to put through the committee. I wish to remind you that a subcommittee has been doing an update on the report of the Special Senate Committee on Euthanasia and Assisted Suicide from five years ago, which was entitled "Of Life and Death." That report has been done by a subcommittee chaired by Senator Carstairs. That subcommittee has completed its report and we need a formal motion to authorize the tabling of that report in the Senate next week, the fifth anniversary of the tabling of the original report. I do not think the motion requires much discussion, but it does require that it be moved formally and seconded and voted on.

Senator Carstairs: I move:

That the Chair and the Deputy Chair be authorized to receive and adopt, on behalf of the Standing Senate Committee on Social Affairs, Science and Technology, the report of the subcommittee to Update "Of Life and Death" on the developments since the tabling in June 1995 of the final report of the Special Senate Committee on Euthanasia and Assisted Suicide, entitled: "Of Life and Death;"

And that Senator Carstairs be authorized to table in the Senate the said report on behalf of the Chairman of the Standing Senate Committee on Social Affairs, Science and Technology.

Senator Fairbairn: I second the motion.

The Chairman: Is it agreed, honourable senators?

Hon. Senators: Agreed.

The Chairman: Carried.

Senator Roche: I wish to point out to the committee that Senator Carstairs did an outstanding job in steering this very difficult and delicate subject through a lengthy series of hearings. The committee produced an outstanding report, about which it should be very proud.

Hon. Senators: Hear, hear!

The Chairman: Congratulations, Senator Carstairs. The report is adopted.

We now continue our three-year study on the health system in Canada and the federal role therein. I am absolutely delighted to have as our witness today the Honourable Monique Bégin, who was health minister from 1977 to 1984, except for a nine-month interregnum in 1979. She was the author of the Canada Health Act in 1974. She subsequently went on to be Dean of Health Sciences at the University of Ottawa, and she is now dean emeritus. When politicians get to the point where people are giving them that title, that is an enormous accolade, given the sort of titles typically attached to politicians after they retire.

We are delighted to have Ms Bégin here. As you all know, from time to time, she has not been shy about expressing her views and is well known to have some fairly strong views on what needs to be done to the Canadian health care system. We are delighted to be the recipient of those views today.

As we must adjourn at 4:45, in light of a vote being held in the Senate at 5:00 p.m. and a recorded vote at 5:30 p.m., I have indicated to Madam Bégin that we will want to have her back. We originally hoped to have a full two-hour session. Clearly, however, we will not have time for that today. We will ask her to give her opening presentation, followed by as many questions as we can ask within the time available to us. Please do not feel that this is your last opportunity to question her, because she has agreed that we will find another opportunity for her to return in the next few weeks or so, certainly before the end of June when we recess.

Thank you very much for being here. Please proceed with your opening statement.

The Hon. Monique Bégin, P.C.: First, I wish to address what has been stated in the press recently. I do not feel obliged to apologize because I do not think I did anything wrong. Nevertheless, I wish to give you an explanation. I am not appearing in front of you this afternoon after having told the media what I would say here today. That is not the case. In fact, May and April are very busy months for me. I attend annual meetings and give key note addresses, and so on, where I have either spoken or written about medicare. I continue to do so, as if it is an evolution.

I wish I had a plan like the one that has been attributed to me, because if I knew how to fix medicare I would be prime minister, or at least the premier of a province. Most of what is written in the newspapers -- and I was upset when I read the press this morning -- comes from an article in the last issue of "Policy Options," which is entirely on medicare and several people have written about it.

[Translation]

I succeeded Marc Lalonde part way through September of 1977 and I read with great interest his deposition as well as the answers he gave to your questions several days ago. I inherited EPF after it had been up and running for two and a half months.

Prior to that, I served as Minister of National Revenue for one year. I suppose I voted in favour of EPF both in Cabinet and in the House of Commons. The vast majority of my Cabinet and caucus colleagues confided in me several years later, while we were in the throes of this so-called health crisis, that they were not quite sure what they were voting for. We were dealing with an extremely complex administrative system and this was the first time, to my knowledge, that a decision was made to replace a cost-shared program with lump-sum payments. When the "crisis" was brought to my attention during Question Period in the House of Commons in January 1979, and I documented these events in my book on public policy, I had been Minister of Health for two and a half years and I had not really been apprised of all of the aspects of the health care program.

[English]

Medicare was in very good health. Such were the times.

We were working on all sorts of health issues but not what we call, in lay language, medicare, meaning the health insurance system. The system was in good health and I had not been briefed on it. We had lots of work.

Mr. Lalonde's memory does not serve him as well as usual, because it was not 33 per cent but 25 per cent of the federal budget that represented the huge portfolio of National Health and Welfare at the time. I had the pleasure of dealing with some of you who were provincial ministers back then, working on the frontline, where I did not have to live every day.

I was on another frontline, though. Suddenly, I had to get involved, and for a very long time, in that particular dossier of public policy. I date it from January 1979 to September 1984, when there was a change of government and I left politics.

The government ended up tabling and obtaining unanimous passage of the Canada Health Act, to fix a problem, which derives, in my opinion, from EPF. Let me explain.

EPF, which Mr. Lalonde addressed when he came, was for the first time a lump-sum transfer payment, mainly in tax points and partly in cash.

As Professor Raisa Deber told you at the very beginning of your deliberations, the two main pieces of legislation that created medicare were the Hospital Insurance and Diagnostic Services Act and, ten years later, the Medical Care Act. Both acts continued to be in existence after EPF. It is the Canada Health Act of 1984 that did away with those two acts, by consolidating them into the Canada Health Act.

That is very interesting, and it is, of course, with hindsight that I, myself, understand the whole dossier more fully each day.

HIDSA and the Medical Care Act remain as the framing legislation for the existence and the justification of medicare funding from a federal viewpoint, but they had been completely castrated -- I hope that is a good English term -- of their powers of enforcement. Those pieces of legislation were conceived on a 50-50 sharing idea. Their enforcement was immediately, automatically, linked to that mode of funding. If there were not as many beds in hospital X or if the lab was not the right size or in the right location, the province was simply not reimbursed for the invoice.

The mode of enforcement was automatic. I insisted on that. To me, that is very important in legislative operations. In my personal opinion, that mode was the least punitive, if punitive at all. It was more a deprivation of funding at the other end. Province X could, though, go back and make adjustments. I did not use that method directly; it was changed during my time at Health and Welfare. A different invoice could be submitted once things were fixed and the province could be finally reimbursed 50 cents on the dollar.

The legislation continued in terms of what expenses were covered and how, but the funding mechanism, which by way of consequence was the enforcement mechanism, was totally divorced because it was EPF that did it. There was absolutely no mechanism of enforcement.

I must say that I never saw the regulations attached to these two old pieces of legislation. It may be interesting -- and I will come back to that -- to study those acts from the viewpoint of today's problems. In the years of the so-called crisis, my officials explained to me, for example, the five principles or conditions of the Canada Health Act that existed in the previous pieces of legislation. No one talked of them. The provinces knew them, but the public had never heard much about them. There were originally four principles. Accessibility was included as a sort of subtext of universality, but we extracted it and made it a formal fifth condition.

The legislation consolidated and did away with the two previous acts, borrowing everything it could from the spirit and the conditions of the previous acts. The new act did not fix something of which I was acutely aware, namely, that the previous legislation covered only what we knew to be "health care" at the time, meaning a doctor-based, hospital-based, acute-care system. Nothing else was paid for at that time.

I totally subscribe, no need to say, to everything that Mr. Lalonde said about health promotion and prevention. He made a presentation on producing and restoring health and preventing the erosion of health, other than through hospitals and doctors. I knew that should be done, but the times were such that it was not possible. It was the end of a political regime. Those were extremely difficult years in terms of the new economic ideologies. It seemed that everyone in Canada was against universality.

We have forgotten now, but there were several fights to begin cutting. The numerous cuts that took place in the second half of the 1980s and into the 1990s were written in the Department of Finance long before that. I am among those who fought those plans. We won a few; we lost a few as well.

My judgment, in terms of strategy, was that if we were to re-open the content of the old legislation everything could have been lost, from the federal view. I could have lost money. I could have lost important funds that were transferred to the provinces. The government to which I belonged may have used the occasion for capping in a major way or for cutting, or whatever. That was my political judgment, which, of course, I could not say at the time.

Some of the provinces could not immediately start other programs. They would have seen my efforts to modernize the list of costs that were covered by federal money as being unfair to the provinces. To elaborate, I would have been imposing on the provinces additional health care costs but without increasing the transfer money. There were a few political problems; let us put it that way.

Thus, I stick with the strict medical hospital type of definition. Nurses have played an historic role, even though the premiers changed the name from medical practitioner to health professional, or something like that. Although it was a great political victory, in practice it did not change anything in the delivery of the health care system.

The Canada Health Act was meant to address the only visible problem of the day, that is, extra charges, through two avenues. There was extra-billing by some physicians, in particular specialists, and user fees were levied by some institutions under provincial authority in some of the provinces.

It took a long time to clarify how far we could go and still respect the Constitution and the division of power, in that health care delivery is a provincial responsibility. I wanted the officials from Justice to help me with what I had heard were new ideas in legislation, mainly to have enforcement mechanisms that were not punitive. Hence, the provinces had three years in which they could put their houses in order. They would have the penalty applied, if it applied, but if their house was put in order before the end of the three years they would get the money back. Then, of course, there was the dollar-for-dollar concept, a concept that is not only fair but which appeared to be fair to the public. I have always thought that the participation of citizens has always been important. It is the citizenry who has always saved medicare whenever there were problems.

I once asked my predecessor in the portfolio why these three main actors -- Mr. Trudeau, Mr. Don Macdonald, who was then minister of finance, and Mr. Lalonde, all from the legal tradition -- had not put in place an enforcement mechanism. I do not know if he remembers that, but he told me that both the feds and the provinces were so pleased with the EPF that everyone would act in good faith and that there would never be any problems. I do not judge the legal profession on that.

I inherited a problem that we just did not know what to do with. We conceived of a fair, simple, and quasi-automatic way of applying the act when it came to extra charges. At the time, it was not possible to foresee what forms other eventual encroachments or breaches would take. Thus, a second general section of the act deals with the general process of assessment, first, and then eventual penalties in the case of other breaches. I refer not to theoretical breaches but those that were unknown at the time.

That brings us to today's situation, where we see the face of possible threats to the system.

I wish I had a plan. I do not. Like everyone who is a specialist in the health care system, I know that some reforms and changes are absolutely essential. They have not taken place. They are slow in coming. Only the downsizing and restructuring of institutions has taken place. Even within that restructuring there has been a clash of institutional cultures, between hospitals that were forced to become one institution.

The Canada Health Act has taken on a life of its own. It has now reached the status of an icon. Because of that, I personally think that no politician can reopen the Canada Health Act, even to improve it, because it will destabilize people too much. Therefore, I came to the conclusion that, first, more money is needed. Second, that money should be cash, and certainly not tax points. Third, this should be done under a new piece of legislation which parallels the Canada Health Act. In theory, the Canada Health Act is about doctors and hospitals. However, in practice, the provinces do what they want with that money. Everyone plays on both levels all the time. In the process, citizens have lost their sense of entitlement, something that I find unacceptable in terms of public accountability.

The new act would cover home care and primary care, which should be the centre of the system but which is the periphery for the time being. I suggest that we would like to add one or two conditions. The first is accountability.

The Canada Health Act was passed sometime in April 1984. It became law on July 1, 1984. I left the portfolio, having known for a long time that I would be leaving it, although no one else knew. I ensured that the regulations pertaining to the enforcement of the penalties would be developed and approved. It was a long process. However, I then left the scene. I never saw any other regulations. I understand that some clauses of the regulations were not even drafted, which brings me to one particular section of the act that I find problematic. I refer to the section that deals with non-profit public administration, which is one of the five conditions.

Mr. Chairman, I will now end my remarks and answer any questions that you may have.

The Chairman: Thank you, Madam Bégin. Before turning to senators for questions, I would like to ask two by way of background. I will resist the temptation at this point to press you on some of your more provocative comments.

Two things have puzzled me about the Canada Health Act. One is that, of the five conditions, four of them, namely, universality, portability, accessibility and comprehensiveness, are all consumer-driven. They refer to the patient. The fifth condition, which is public administration, has always struck me as odd, in the sense that it refers to the means by which the other conditions will be met. I think that any system that met the conditions of universality, accountability, portability and comprehensiveness would be acceptable. I find it funny that the means of achieving the end has been elevated to the level of the others; or is it really of a different kind? I do not understand how it got there, other than the fact that it was in Emmett Hall's original report. Why was that maintained?

Ms Bégin: I was very young in the 1960s. I was not involved in politics then. I cannot even recall which ministers of health did it. I cannot answer you, Mr. Chairman.

You will have to go back to Malcolm Taylor, and I do not even know if he speaks of it. I do not remember that in his famous textbook.

I always thought that the first three that you named, and the fourth that I added, which you call consumer-driven, have to be consumer-driven because they give the citizens their entitlement. I cannot call it a right. It has nothing to do with rights. It is an agreed-upon privilege of our society to the taxpayers and citizens. They need to know that.

The Chairman: I agree with you that it is an entitlement. Most citizens have raised it to the level of a right, in the sense that it is how one thinks about medicare and the Canada Health Act.

Ms Bégin: The person who published the English version of my text wrote "the right to health." That is stupid. However, I discovered that when you write a book in one language you do not control the other language. It is not "the right to health." That does not exist. This involves philosophy, and many people do not function at that level.

The Chairman: You are saying that public administration began long before you got there and it was just maintained.

As someone who was in the market research business for a long time, if I was doing a survey and seeking public attitudes on what today's consumers wanted from the health care system, I think they would focus on three things. First, they would say they want quality health care, which is somewhat similar to comprehensiveness; second, they would want speed, in the sense that an element of quality is reasonably fast responsiveness to the system, which many Canadians would argue is not there now; and, third -- and equally important to the other two -- they would argue that they want the confidence that the system is economically sustainable in the long run. That is to say, they would like to know that the "insurance policy" that says that if they get sick they will be taken care of will not go bankrupt and will be there when they grow old.

From looking at public attitude data, what is undermining confidence in the system, perhaps more than any other single thing, is an unease that the system will not be there when people need it. That is to say, this "insurance policy element" is disappearing. Would you like to comment on that?

And if you think I am in the ballpark, does that mean that, for example, long-term sustainability should become a principle of a new Canada Health Act, or a new act, as you call it?

Ms Bégin: I think people want quality. If I were to add two criteria, I would say, first, accountability. "Quality" is a cosmetic word, because I do not know how you translate that operationally. While it is true that people want it, generally speaking, Canadians know they get quality because up to now the system has served Canadians rather well.

Concerning speed, I disagree with you. People want speed when they order pizza that is delivered within 15 minutes or else you are reimbursed, but I do not think the government wants to operate that way, or can. People have lots of tolerance. What they do not want is an unacceptable length of waiting time. They do not want a mess at the emergency room every Christmas season, but everyone knows how to "fix" and address that situation.

Sustainability is certainly a worry for Canadians. They want the system there when they need it. I never thought of the distinction that you made concerning the four conditions being consumer-driven. The fifth is an administrative concept, namely, the public administration of health care.

The Chairman: It is a means to an end.

Ms Bégin: Perhaps there should be a set of conditions concerning the operation of the system and sustainability. I think stability of funding from the federal government is a must. It is impossible to have healthy federal-provincial relations when the federal government suddenly makes cuts to the system, and so on. Having said that, the fiscal house had to be put in order. That is why Mr. Martin now has all those billions. I am neither commenting on the way it was done nor how it was done from 1984 on.

"Sustainability" means stability of funding. In the article that was published last week in "Policy Option," I said that perhaps the cash contribution could be 25 per cent. That is a figure, not a prescription. It is an image of what could be. I think the tax points are gone; they are "lost". Senator Robertson made the point to Marc Lalonde that, historically, the provinces had been robbed in the first place. I did not know that. I will go back and read about that, to see exactly how it happened.

The fight between the two levels of government concerning the figures is absolutely unproductive and counterproductive. They should agree to percentage X, and that should be the rule of the game. The provinces need stability of funding, and the public needs to know that it is there. It is absolutely essential that the public knows that as well.

The Chairman: That is the way you get the sustainability?

Ms Bégin: Yes.

Senator LeBreton: That is perfect. In the paper that you just referred to, you talk about the need for federal-provincial cooperation. The article concerns the whole issue of tax points. You say in this paper -- and I am paraphrasing -- that because tax points have been transferred to the provinces in 1977 and are lost forever to the feds we should not talk about them any more. In your comments, you said that citizens have lost their sense of entitlement.

This tax point issue is a huge football. The public is confused about it. The tax points represent money. I understand the point you make, but how do we get that back on the table? This is an excuse that is tossed back and forth between levels of government. There are tax points, yet the public does not have any sense of what the tax points mean or how they contribute. I know that we should not talk about them anymore, but how do we deal with them? How do we get into the public mind what those tax points actually represent, in terms of the delivery of the health care system?

Ms Bégin: I am suggesting that we stop talking about them in the sense that I feel -- and Mr. Lalonde said the same in his testimony -- that politics is the art of the possible. There are days that I hate the EPF. You have no idea. I lived a nightmare for years after because of something that was wrong with EPF, although I know the good sides of it. According to several political scientists, the 1970s was the decade of provincial affirmation. That continued into the 1980s. It is the art of the possible. Tax points were given, in a major way, to everyone.

I used the Canada Health Act with my idea that citizens will always be the defenders of medicare. If they do not like it, then it will disappear. I wanted accountability built in, so there is a clause that calls for the federal government to publish an annual report. That did not exist before. However, it does not mean much since the CHST. The lump sum transfer is even broader. The Auditor General has said bluntly that the federal government does not have a clue about what it gives to the provinces and for what.

There was some resistance inside Health Canada, but we created a column for tax points, a column for the value of the tax points, and a column for the cash and a total. I did my share of publicizing the whole sum in an effort to make the federal government accountable.

That battle is now lost. First, that kind of fight between the two levels of government is a mess. Neither the provincial nor the federal administrators have any real concept of the costs involved in the health care system. Often the figures are blurred. It is political gamesmanship at its worst. This cannot go on.

The tax point system is what fuels best that counterproductive war of figures. If Senator Robertson is right historically, the matter reverts to the provinces and that is it. We do not speak of it any more.

Our country is one of the most decentralized federations in the world. The public always sees Ottawa as a big brother, but your researchers can provide you with the proportion of the tax capacity of the federal government to the provinces, which immediately after the war was something like 75 to 25 per cent. It is now the reverse. I would simply not speak of it.

I would set a cash floor in respect of what the federal government ought to commit itself. The federal government should not just seek political recognition, but in terms of straight accounting and accountability, value for money for programs should be attached as well.

Senator LeBreton: That is part of the problem. Some provinces say they are not getting the funding they used to, but then they will be told that they have tax points.

What about going back to a more open accountability of the tax points? Are you just suggesting establishing a new floor level and the tax points are just tax points? Where will they go? What is the solution?

Ms Bégin: The provinces will do what they want with it, the way they have always done since 1977.

I would just take the tax points out of the way. I think it poisons the whole thing and does not help at all. If it was bad politics, so be it. It was bad politics, but I still believe firmly that it was the only thing they could do at the time. Perhaps they should have given fewer tax points and more cash. I was not a party to the negotiations.

Senator LeBreton: I will just make a comment, if I may, that speaks to one excellent suggestion in your paper, where you advocate the creation of a council of health ministers with a permanent secretariat. It seems to me that some permanent body must continue. Otherwise, in 10 years, we will be going through this debate again.

Ms Bégin: The federal minister will never be able to tell them what to do and what not to do. Between peers, they could do a great job helping each other and reinforcing themselves.

Senator LeBreton: Previous witnesses have told us that the members of the public are tired of watching one level of government blame another level of government. They want it fixed.

Ms Bégin: There should still be federal-provincial meetings on policy and health. There is room for great initiatives, and many great opportunities were lost.

Senator Carstairs: The reality is, I think you are right. We have to stop fighting the war on tax points. It is over and done with; go away. To try to explain tax points to an audience, I am sure, as you have done, I have done it, everyone goes glassy-eyed. They do not know what you are talking about, and they never will, so forget it.

In your view, is there bargaining potential for accountability by granting more cash? For example, in return for the federal government increasing its contribution, which everyone recognizes must happen, can you bargain with the provinces to get the kind of accountability from them in reporting what they have spent the money on?

Ms Bégin: I was looking at the penalties of the first years of operation of the Canada Health Act. For me, the answer is yes. The level of funding by way of cash payments that is below 25 per cent, whatever it is, would still be ample for the federal government to have bargaining power and to ensure that they enforce whatever legislation presides, whatever new money they will offer, including the cash that remains under the CHST.

Senator Carstairs: We have decided we can get some accountability. Can we also negotiate for them to move into new programming? Home care or community-based care, whichever way you want to talk about, has been identified as a need in the society. The other area that has been highlighted is pharmacare, as we are moving more and more into drugs. I think you said drugs would replace surgery in many instances.

Can there be negotiations between politicians, where the feds will say, "Yes, we will give you moneys, but in order to achieve those moneys you must put more resources into community-based care and you must develop some form of pharmacare program"?

Ms Bégin: I was very sensitive to what Mr. Lalonde said about not taking the longer view, not falling into the trap of the short term and not building new rigidities into the system.

I cannot believe that 16 years ago we never thought the Alberta situation would occur, or the private and public MRIs next to each other in the Peel Hospital in Greater Toronto. That is kind of absolute nonsense in my opinion.

This is really a system in evolution. I do not have an answer; I am alone. I just bumped into the Auditor General, who was heading off to a committee to appear as a witness; 12 officials, with bags, accompanied him. How can I give you the operational answer? I do not know it. We should find a way. It is feasible. It should be discussed, first of all.

We do not see much concrete discussion around the goals for which new money should be given. I do not know how to express it to be both general and flexible enough for the provinces to do it their way and to do so in a way that they feel it is their priority and at the same time to give back to Canadians a sense of their basic entitlements. This area needs to be studied.

Senator Keon: I would like to build on Senator Carstairs' questions and on something you said in your testimony, that we should not touch the Canada Health Act.

We all agree that it is too unsettling to the public to open up that act. However, let us use the act as a platform from which we can move into federal-provincial and community relations. Let us move beyond doctors and hospitals, out to the front end of prevention and population health, public health, toward home care and rehabilitation and such things.

I believe we could design systems with the kind of formula you describe, with the built-in cash from the federal government. We could have a co-operative system with a national context but provincial implementation, particularly as it relates to health care delivery.

The idea of private clinics is damaging to our system, not only because those clinics are private but because they operate from 9 to 5. Our public institutions are overrun on nights and weekends; they cannot handle the load. I do not just refer to imaging clinics and so forth. I mean health service clinics.

We have no mechanism right now for regulating that, but we could move off the platform of the Canada Health Act. We could build the pyramid and spill over the sides with various new programs that could come under our old-fashioned funding formula.

Learning from Senator Robertson, we cannot have an open-ended system where the provinces bargain. You are looking at me as though you are bewildered. I do want to hear your comments.

Ms Bégin: I am not sure I understood. Do you mean that we could update the Canada Health Act simply?

Senator Keon: No. We should leave the Canada Health Act as a platform. We can build a pyramid on the Canada Health Act. We can build vertically and horizontally. We can build in front-end programs such as universal population health, public health and so forth. We can build in back-end programs -- rehabilitation and community programs.

Ms Bégin: Do you see that being done through legislation or just as a declaration of intent?

Senator Keon: That is what I want to hear from you.

Ms Bégin: Yes, I think ideally we should update and refine and enlarge the Canada Health Act, but it is not feasible for the political reasons that I mentioned. This is not partisan politics. It is the public view.

What you describe as the pyramid, meaning programs of care before and after and other than in hospitals, should be part of a new parallel act, for lack of a better word. I wanted to convey that we should have the same rules of the game except that we should clarify the areas that are not clear in the Canada Health Act.

For me, the public administration clause is so general that no one can be against it. As it is now, at the top of a given province is the public administration, but then regional authorities can do what they want. There is a complete disconnection there.

Speaking of private/public, by the way, we should discuss "for profit" and "not for profit." There are many pieces of the health care system that are already "private." In the very early 1980s or earlier, hospitals went private with their laundry services, then the food services, then the labs. Many labs in our system are privately run.

My doctor wanted a battery of tests done. I went to a place called Dynacare, where they process patients like sausages. I hope and I am sure they do an excellent job in their scientific assessments and measurements.

I checked with some health economists. Not one single evaluation study was conducted on any of the privatization measures that I have just mentioned. It was assumed that privatization of those services was cheaper and more productive. We all think but do not say it -- privatization frees us from union rules that are far too rigid. That is for sure.

Mr. Lalonde gave the example of the nurse who cannot be moved from one floor to the next. That is one of many examples and it is a pity.

We know instinctively that going private for food and kitchen and laundry -- and maybe labs, I do not know -- will not put medicare as a public system in danger, but, somehow, the next step will. I wish I knew the full rules of the game by which certain things just will not work, but I do not.

I am not privy to any intelligence here, but I read in the newspaper of a hospital -- I think it is in Peel County -- where they had as neighbours a private MRI and a public MRI. That makes no sense whatsoever. That is contradictory in logic. The logic of profit and the logic of the private good just do not work together.

The future clinics in Alberta are the same. The physicians will be accredited to public hospitals and to private clinics. Where will they go? Human nature being what it is, the doctors will go where the pay is higher. It is elementary.

The main question to be discussed, explored and resolved by making new rules of the game is where to allow for-profit work and where to keep public work only.

The Shouldice Hospital in Toronto is a special historical exception to the creation of medicare but one that is totally acceptable, as far as I know. That issue must be clarified.

The Chairman: I want to be sure I understand your point and that made by Senator Keon. You speak of building on the base of the Canada Health Act and broadening its coverage. Federal politicians for decades have talked about the federal role in the health care system. The federal government has never been in the broad health care system in the same way the public perceives the health care system. The federal government finances hospitals and doctors, not the health care system, per se.

Ms Bégin: In two avenues, which are now changing, the federal government acted as a provincial minister of health -- that is, in veterans health and in aboriginal health.

The Chairman: In the broader sense, though, the term "health care," when used by a federal government spokesperson or when read by the average citizen, includes everything -- drugs, home care, long-term care. The federal government has never really acted at that broad level of health care. It has only been involved with hospitals and doctors.

You seemed to respond to the premise underlying Senator Keon's question by saying that it is about time we had an act that defined the federal government's role in health care in the broader sense, not merely in the sense of hospitals and doctors. We can leave the cornerstone of hospital and doctors, but we should enlarge on it. Is that what the two of you were saying essentially?

Ms Bégin: I cannot speak for Dr. Keon. I will let him answer.

What you say is too black and white to reflect the evolution of the health care system. When it was created, it was just about hospitals and doctors. We did not know anything else -- that is what health care was. Read the preamble of the Canada Health Act, which is new. It goes further than that. I, however, did not have time to re-read it before this meeting. I made sure that it expressed the philosophy of health care the way Marc Lalonde presented it when he appeared here before you. I was pleased with my preamble because we modernized without creating any problems with the provinces. Something I understood after the fact is that it seems that the preamble has no validity in law. If my memory serves me well, the preamble contains a very modern definition of health, except that it is not operational. Do you see what I mean?

The Chairman: Senator Keon, do you want to comment on my observation, or did I understand you correctly?

Senator Keon: I think you summarized fundamentally the concept. I wanted Ms Bégin's response to that concept.

Ms Bégin: Federally, a broader definition has always existed. Times are changing. It is not encapsulated in legislation.

The Chairman: Senator Callbeck is not only a former premier of Prince Edward Island, she was the provincial minister of health at the same time that Madam Bégin was the federal minister of health.

Senator Callbeck: Ms Bégin, it is great to see you again. I want to come back to the funding to the provinces. Did I understand that you are advocating going back to a cost-shared system? You mentioned the feds paying 25 per cent of total health expenditures.

Ms Bégin: I understand what you are saying. I do not recommend going back to the cost-shared system that existed, where the provinces called the shots and the feds reimbursed one-half of them. I am not completely clear in my own mind yet as to how to do it. However, the provinces would have to agree with the feds as to a kind of global national envelope for health care. Of course, using the percentage of GDP is not the perfect measure.

I have to think it through more. For instance, if there is a global envelope, then the feds will transfer a lump sum. That global envelope will increase with the years. Hence, it is not a cost-shared system, in the sense that the feds control it. They still keep the notion of EPF, which is the transfer of a lump sum. That is what is done right now. A base year was chosen. I think it was 1975 or 1976.

Senator Callbeck: I think it was 1975.

Ms Bégin: They all agreed on what it cost them. Those who felt badly treated received equalization or a way to catch up. Everyone agreed on the base year. A mathematical formula was arrived at, by which it would increase by population growth, GDP, and a third indicator, which escapes me right now.

I should like to find out from someone who knows how it came to be understood by the main actors that the cash would never be more than 25 per cent. That should be verified. Certainly, there is a definition of what the cash would be in proportion to the non-cash.

Senator Callbeck: Just to get it clear in my own mind, there is an envelope of money provided by the federal government, and that enveloped is divided among the provinces. Will the federal government tell the provinces that that must be spent on health expenditures, or will it be flexible like it is right now?

Ms Bégin: It is clear to me that there is no way we can come back on the big chunk of that money, which is the tax points. Someone, somewhere, has to be inventive in devising a system of accountability around a few goals and general ideas as to what that new money is for. I do not think you can touch the past. For me, the past is the past, for the reasons I have just explained. A huge chunk of the cost of the total bill for health in a given province comes from the transfer of federal tax points. Then there is their share -- and nobody knows what that is. It is a great deal, but it differs from province to province in terms of what it covers.

Then there is the federal cash. There will be new money. I have read in the newspapers, which I trust, that the Minister of Health, the Minister of Finance and the Prime Minister have assured Canadians that as soon as they all agree on what reform should take place -- and it should take place -- they will have new money. I start from that idea.

The Chairman: If the federal government were to give more money, how could there be an accountability mechanism? Perhaps you would not go back to the detailed 50-50 formula. By "detailed", I mean that it was micromanaged. On the other hand, by its very nature, block funding, with no strings attached, has no penalty mechanism.

Ms Bégin: It has enforcement mechanisms and penalties right now. I am talking about health, not post-secondary education.

The Chairman: That is right. Even if the federal amount is raised, it will be a small enough piece that it is not clear to me that the funding mechanism --

Ms Bégin: Billions are billions are billions. I assure you that the provinces understand the language of money very well, as I do.

The Chairman: Do you think the federal government can impose enough conditions to make accountability work?

Ms Bégin: When we speak of conditions, they cannot and should not be rigid operational conditions.

The Chairman: I agree.

Ms Bégin: They are general, consumer-driven principles or standards, which is totally legitimate constitutionally. They give an amount of cash to achieve these results.

The Chairman: Has anyone you know of looked at the question of what those results, outcomes, what I am calling conditions, might be? We have not seen any evidence on that. This is assuming the federal government goes down this road.

Ms Bégin: In the context of discussing the Canada Health Act the way we are, no, I do not know anyone who has done that. However, in that regard, your committee should hear from the former deputy minister of health of Ontario, who does excellent work at CIHI. At times, I feel like asking him why he did not do all that when he was deputy minister of health for Ontario, but I have not asked him.

[Translation]

Senator Gill: I come from a rural area and I am an aboriginal. I realize that health care programs are administered by Health Canada. Generally speaking, aboriginal communities are remote and located some distance from large urban centres. Health care is beyond our control and costs are astronomical. I do not foresee the day when the financial situation will get any better.

For some time now, people have been stripped of their responsibilities. Centralization appears to be the order of the day, not just when it comes to health care, but also in the field of education. Given technological developments and advances, the need to centralize is understandable. However, people have been stripped of certain responsibilities.

For example, in my part of the country, Northern Quebec, transportation costs in remote areas are very high and direct health care is not available. Repercussions are inevitable. Even though the federal government does not have jurisdiction over health care everywhere, people should be made to assume more responsibilities. Many kinds of care can be provided at home. When I was a young man, a number of illnesses were treated at home.

While I am not a health care expert, I do believe that we need to get back to basics and provide health care at the local level, so that people do not have to travel to receive treatment. There are many people in the community with medical knowledge and skills, and I am not just talking about aboriginal communities.

Ms. Bégin: Our health legislation makes no mention of the concept of responsibility and I think this should change. However, I am not really sure how we could go about introducing this concept and how it would apply.

Supposing a provision in a future piece of legislation refers to individual responsibility. What if this provision were invoked in the case of obese individuals, people with lung cancer and young persons seeking to have a tattoo removed? I do not agree that these individuals should be punished for behaviour deemed irresponsible. I do not favour this kind of accountability. I believe education is the key to making people more responsible. I would be leery about invoking such a provision, although I agree that perhaps mention should be made of the concept in the act's preamble.

Your question gives me the opportunity to mention that aboriginal health care presents new challenges for our society. Demographically speaking, many aboriginals live off of reserves. The provinces and the federal government are waging hidden battles over who should pay for aboriginal health care.

I have encountered some unlikely situations and have had to negotiate and resolve some incredible problems. I would also like to mention that I am responsible for bringing about the devolution of health care services to aboriginal communities. Initially, the Community Healthcare Workers' initiative was launched, with workers being band members. However, this approach was not very effective.

Subsequently, reserves were allowed to select where they wanted residents sent for treatment. Many residents chose the Royal Victoria or Mount Sinai and obviously, that was impractical. Then they were allowed to select various health care services and programs.

I never conducted a study as such, but as a recall, reserves opted mainly for services such as detoxification centres and small programs associated with day-to-day life. I am not aware of the current situation but I have observed that aboriginal communities are experiencing phenomenal growth. More aboriginals are moving to large urban areas every day. Prescription drug abuse is also a problem. Moreover, the Auditor General alluded to it in his report.

There is nothing more that I can say about making people accountable. Obviously, society must work to make people accountable at all levels. Other resources and services are available, aside from hospitals, to help people maintain good health and to prevent and treat illness.

Why are Quebec's CLSCs not open 24 hours a day, seven days a week? Doctors working in teams could sign a contract with their province and abide by the rules of the game. Obviously, a different kind of health care is needed in remote regions.

[English]

The Chairman: Thank you very much. Senators, we must adjourn. We have a vote in 12 minutes. We will continue our session with Ms Bégin as soon as we are able to arrange another mutually convenient time, and our first questioner will be Senator Robertson.

Thank you very much for attending here this afternoon. We look forward to round two.

The committee adjourned.