Canada - World Health Organization Regional Office for Europe
Canada - World Health Organization Regional Office for Europe
Canada - World Health Organization Regional Office for Europe
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<strong>Health</strong> systems in transition <strong>Canada</strong> 23<br />
principles of which are upheld by provinces wanting to receive their full share<br />
of the <strong>Canada</strong> <strong>Health</strong> Transfer (see Fig. 2.1). By not taxing health benefits<br />
through employment-based insurance, the federal government also provides an<br />
implicit subsidy to encourage PHI coverage <strong>for</strong> non-medicare health services<br />
and pharmaceuticals.<br />
2.2 Historical background<br />
Provincial governments have a long history of providing subsidies to hospitals<br />
to admit and treat all patients irrespective of their ability to pay. The government<br />
of Ontario set the template through the Charity Aid Act of 1874 in which<br />
non-profit-making municipal, charitable and faith-based (mainly Catholic but<br />
also Protestant and Jewish) hospitals were obliged to accept some regulatory<br />
oversight – and indigent patients on the basis of medical need – in return <strong>for</strong> a<br />
per diem reimbursement. Private profit-making hospitals were excluded from<br />
this arrangement, thus restricting the growth of such hospitals in <strong>Canada</strong>. At<br />
the same time, the proliferation of municipal and non-profit-making hospitals<br />
voluntarily serving a public purpose meant that there were few state-owned and<br />
controlled hospitals (Boychuk, 1999). The major exceptions to this evolution<br />
were the provincially administered mental hospitals that emerged in the<br />
twentieth century in response to the poor state of private and nongovernmental<br />
asylums (Dyck, 2011). Cottage hospitals in the coastal fishing communities of<br />
Newfoundland as well as the inpatient institutions <strong>for</strong> the treatment of severe<br />
and chronic mental illness, tuberculosis and cancer were also run directly<br />
by some provincial governments (Grzybowski & Allen, 1999; Lawson &<br />
Noseworthy, 2009).<br />
As was the case with hospital care of the indigent, Ontario initially led<br />
the way in facilitating financial protection in the event of illness. In 1914, the<br />
provincial government introduced worker’s compensation legislation that<br />
provided medical, hospital and rehabilitation care <strong>for</strong> all entitled workers in the<br />
event of any work-related accident or injury in return <strong>for</strong> workers giving up their<br />
legal right to sue employers. This Ontario law, and the Workers’ Compensation<br />
Board (WCB) that it established, became the model <strong>for</strong> the remaining provinces<br />
(Babcock, 2006). Less than two decades later, Ontario would also be the first<br />
jurisdiction to establish a province-wide medical service plan <strong>for</strong> all social<br />
assistance recipients (Naylor, 1986; Taylor, 1987).