Canada Health Act - History: Federalism

History: Federalism

Canada is a federal country in which power is distributed between the national government and the ten provinces. The division of power was spelled out in the British North America Act 1867 (renamed the Constitution Act, 1867 in 1982). Section 92(7) lists as one of the "exclusive powers of provincial legislatures" "The Establishment, Maintenance, and Management of Hospitals, Asylums, Charities, and Eleemosynary Institutions in and for the Province, other than Marine Hospitals." Although this language does not specifically give authority over 'health care,' subsequent court cases and interpretations have generally established the provinces have paramount authority in this area.

Over time, the mismatch between fiscal resources and fiscal capacity became increasingly problematic. If Canadians were to have similar levels of service, it would be necessary for the national government to somehow equalize the ability to pay for it. Yet attempts by the national government to implement programs directly encountered resistance from the provinces. This resulted in several legal battles. In a few cases, where there was agreement that the federal government should take the lead, adverse court decisions were handled by amending the constitution (e.g., in 1940, in response to a court decision that federal unemployment insurance was unconstitutional, the Constitution Act, 1867 was amended to give the national Parliament jurisdiction over unemployment insurance). More commonly, however, other approaches have been used. Canadian health policy has accordingly been strongly related to Fiscal federalism and questions as to how best to address Fiscal imbalance. In consequence, Canada does not have - and arguably cannot have - a national health care system.

The Constitution Act does give potential powers over elements of health care to the federal government through various clauses (e.g., quarantine), but the role of the federal government has been highly debated. As summarized by a Senate Committee led by Michael Kirby, the federal government has a number of roles to play, including assisting the provinces in paying for health services. Although this has not been tested in court, the federal government has assumed that it is entitled to use its spending powers to set national standards. However, the extent to which 'strings' can be (and are) attached to federal transfers has remained contentious, and most federal governments have been unwilling to antagonize the provinces.