Canada: Chaoulli Opens The Door To Private Clinics And Private Insurance In The Health Sector In Quebec

Last Updated: July 19 2006
Article by Sylvie Bourdeau

Purpose of the consultation

On February 16, 2006, Québec Premier Jean Charest and Minister of Health and Social Services Philippe Couillard filed a consultation document entitled Garantir l’accès: un défi d’équité, d’efficience et de qualité in order to identify measures that will improve access to health and medical services while reducing waiting times. The consultation document focuses on three issues:

  1. the pursuit of existing targets, such as emphasizing prevention efforts, improving front-line services and organizing medical and hospital services;
  2. longer-term funding of the health and social services sector; and
  3. improving access to medical and hospital services to reduce waiting times.

This bulletin will only addresses the third point, which is of particular interest to us.

Consultation background

This latest proposal is a response to the matter of Chaoulli v. Québec (Attorney General)1 ("Chaoulli"). The Supreme Court of Canada judgment ruled by a four-three majority that the Québec legislative provisions prohibiting the use of private insurance to pay for medical or hospital services covered by the province’s public system violate the rights to life and inviolability under the Québec Charter of Human Rights and Freedoms.2 Three of the four judges who sided with the majority also ruled, among other things, that the same provisions violate the rights to life and safety under the Canadian Charter of Rights and Freedoms.3 Justice Deschamps drafted the majority decision. After examining the health-care systems of other provinces, she concluded that the experience of provinces that allow certain health services to be offered by private interests in the public system refutes the argument that private insurance constitutes a threat to public health care services. Consequently, she ruled that the prohibition is not necessary to preserve the integrity of the public system. For their part, Chief Justice McLachlin and Justice Major added that, since the public health care system in Québec does not provide access to satisfactory health care, the prohibition on purchasing private insurance to pay for medical or hospital services covered by the province’s public system exposes individuals to long waiting times, thus compromising their health and safety. Chaoulli invalidates section 11 of the Hospital Insurance Act4 and section 15 of the Health Insurance Act5 cited below:

"11. (1) No one shall make or renew, or make a payment under a contract under which

(a) a resident is to be provided with or to be reimbursed for the cost of any hospital service that is one of the insured services;

(b) payment is conditional upon the hospitalization of a resident; or

(c) payment is dependent upon the length of time the resident is a patient in a facility maintained by an institution contemplated in section 2.

…"

"15. No person shall make or renew a contract of insurance or make a payment under a contract of insurance under which an insured service is furnished or under which all or part of the cost of such a service is paid to a resident or temporary resident of Québec or to another person on his behalf.

If such a contract also covers other services and property it shall remain in force as regards such other services and property and the consideration provided with respect to such contract must be adjusted accordingly, unless the beneficiary of such services and of such property agrees to receive equivalent benefits in exchange.

If the consideration was paid in advance, the amount of the reimbursement or adjustment, as the case may be, must be remitted within three months unless the insured person agrees, during such period, to receive equivalent benefits.

If the total amount of the reimbursements or adjustments to be made as regards one person under a contract made for not more than one year is less than $5, the amount shall not be exigible but it shall be remitted to the Minister to be paid to the Fonds de la recherche en santé du Québec contemplated in section 96.

The first paragraph does not apply to a contract covering the excess cost of insured services rendered outside Québec or the excess cost of any medication of which the Board assumes payment nor does it apply to a contract covering the contribution payable by an insured person under the Act respecting prescription drug insurance (R.S.Q., c. A-29.01)."

By invalidating these provisions, Chaoulli opens the door to the use of private insurance to pay non-participating physicians6 for services covered by Québec’s health insurance plan (the public health care plan) and for health services offered exclusively in hospitals. It therefore allows individuals who have the financial means to take out insurance that covers services currently funded by the public sector.

In spite of this decision, the Supreme Court of Canada suspended the judgment’s effective date and gave the Québec government until June 9, 2006 to act.

Québec government’s position

In its response to Chaoulli, the government confirms its commitment to a fair and accessible public health-care system in which the private sector would play a complementary role to ensure greater accessibility to health care and better cost control. To do this, the government proposes the following solutions to the problems raised in the decision:

  1. a patient-centered mechanism granting access to identified services within the prescribed wait times; and
  2. limited private insurance coverage.

Guaranteed access

Radio-oncology and tertiary cardiology services (including cardiac surgery, hemodynamics, angioplasty and electrophysiology services) already benefit from a certain form of guaranteed access. This guarantee, which allows people to obtain health-care services within a reasonable timeframe not exceeding the maximum waiting periods set by experts, will continue to apply to these services.

The government is also proposing to extend this guarantee to other types of hospital services. Determination of the services that will be covered will be based on the specific characteristics of these services; the extent of the problems that the services attempt to correct and their impact on the health of individuals; as well as the length of waiting lists and waiting periods. Guaranteed access would exist solely for those services designated by regulation once the minister has defined the parameters. An integrated information system would be created to monitor waiting lists.

Based on these criteria, the Québec government has already identified a number of services (elective hip, knee and cataract procedures, as well as surgeries related to cancer treatment) for which guarantee mechanisms will be created to ensure access within reasonable time periods.

These wait times however, must still be set. A six-month wait time is currently proposed for targeted elective surgery in orthopaedics and ophthalmology. This would be adjusted to reflect new information on medically acceptable wait times. In all cases, guaranteed access timeframes would establish a maximum waiting period that could not be substituted for a clinician’s recommendation for each particular case.

The government proposes the following model for this guaranteed access to targeted orthopaedic and ophthalmological surgeries:7

In order to benefit from guaranteed access, the patient must have: (i) consulted a general physician participating in the public system (ii) consulted a specialist participating in the public system and (iii) be officially placed on the waiting list of the facility to which he was originally referred. Prescribed wait times will only start to lapse once the patient is placed on the waiting list.

Guaranteed access to services first ensures that scheduling (?) of the patient’s procedure, which includes setting a date for the operation, will be carried out within 30 days of that patient’s name being placed on the waiting list. The patient’s clinical condition will be periodically assessed. What is more, each facility will have a team that provides personalized patient management in cases where the waiting time prescribed in the draft treatment plan or for a medical procedure is not respected.

More specifically, in the case of targeted elective orthopaedic and ophthalmological surgeries, the guarantee will provide that patients not treated within the prescribed wait time of six months will be given the opportunity to be operated in another establishment – either in the region or outside the region – or in a specialized clinic affiliated with the public sector. If the wait time exceeds nine months, patients may be operated on, at the State’s expense, outside Québec or Canada or by private suppliers.8

Affiliated specialized clinics

The government would also like to create specialized medical clinics in the province of Québec that are built, equipped and managed by private partners. Affiliated with one or several hospitals or health and social services centers, these clinics would offer services to citizens within the public health care system. Public establishments would purchase services (imaging, minor surgeries) provided by doctors participating in the public system, at no cost to the patient. The Québec government has listed the following principal characteristics of these proposed private clinics in its report:

"[TRANSLATION]

  • the clinics would provide insured services within the context of agreements with one or several public general hospitals with which they would be affiliated; these agreements should provide for the continuity of care in the public health network, including rehabilitation and home care;
  • the cost of services provided by the affiliated specialized clinics would be entirely assumed by the government at no cost to the patient, as is currently the case in public hospitals;
  • affiliated specialized clinics would provide services exclusively (or mainly) to meet the needs of their affiliated establishments, in accordance with the conditions provided by agreement;
  • the affiliated specialized clinics would provide the capital needed to acquire their equipment and facilities;
  • the clinics would be entirely responsible and liable for managing and providing services contemplated in the agreements entered into with the regional agency and establishment at issue;
  • the services provided by the affiliated specialized clinics would be reimbursed based on the standard costs provided for in the agreement, including equipment usage fees (the reimbursement costs of which must be similar to or less than costs charged by the public network);
  • the clinics would be granted the status of affiliated specialized clinic based on an eligibility grid, which would include such criteria as meeting a health need, standards of quality, economic and ethical considerations, etc. This means that the status of affiliated specialized clinic would only be granted to clinics that provide quality medical and technical services that complement the public network and fit into the service and medical staff organisation plans drawn up by the establishments and the regional agency.
  • affiliated specialized clinics would be required to obtain a specialized clinic permit for surgical activities contemplated by the agreement.
  • given the shortage of doctors and other health care professionals, the conditions imposed on the creation of affiliated specialized clinics must be such as to make sure that the doctors working in these centers do not deprive public sector establishments of the specialized resources required to provide services to the general population."

Private insurance

The Québec government also intends to lift the prohibition that currently prevents citizens from taking out private insurance that covers services offered in private clinics by physicians who do not participate in the public system. Initially, private insurance will cover those elective cases defined by regulation. The current suggestion is that these surgeries be limited to hip, knee and cataract procedures. The availability of such services would double the supply of services that are currently available only in hospitals, therefore shifting some of the demand and expense shouldered by the public health care system onto the private sector and help better meet the expectations of patients. Naturally, insurance coverage and private clinical services would necessarily cover the entire care episode, and therefore include rehabilitation and home care.

Doctors who want to practice outside the public system should work exclusively in the private system in order to preserve the principle of remuneration exclusivity. The government would also limit the number of doctors authorized to practice in the private sector, as well as fees charged for their services. Private facilities that would like to offer health care services would be subject to contractual or regulatory provisions and would be required to hold hospitalization permits, in order to guarantee minimum quality standards and ensure that private service providers complement the public health system and are held liable for any complications resulting from their procedures.

But as is currently the case in Québec, citizens will still be able to take out private insurance to cover other health services or additional fees allowing them to procure goods or services not covered under the existing public system.

Conclusion

Based on this consultation paper, the Québec government appears to be willing to open the door to allowing the private sector into the health system. Even though the door has only opened slightly, it can be opened wider in the future. Indeed, the Minister of Health and Social Services has yet to enact regulations that will determine what services will be subject to guaranteed access. The government therefore has additional leeway for determining what range of health-care services will be guaranteed. New services may be guaranteed depending on the circumstances, nature, number of people affected and waiting times specific to each service. While the proposed solution is a positive one, one is left to question whether it answers all of the concerns raised by the Supreme Court of Canada in Chaoulli given the possibility that wait lists could still affect services not covered by guaranteed access, creating a potential violation of the rights to life and inviolability?

The fact that inclusion of the private sector within the public health care system remains limited at this stage is a sign that the government is determined to maintain a strong public health care system and to continue to adhere to the fundamental principles that guide that system today. For the Québec government, access to health services must be based on the needs of individuals, not on their ability to pay. Moreover, the government wants to ensure that the mechanisms guaranteeing the quality of public services will apply to all service providers, public and private. The government repeated that it intends to impose guidelines on the evolution of health services and on the protection of the human resources that the public health-care system needs to operate.

Minister Couillard’s white paper will be brought before the parliamentary commission in April for public consultation. This will be a very important exercise for Québec, since it is embarking on a trend experienced in other countries in Europe and Oceania that have chosen to take the road of duplicative private insurance. Some legislative and regulatory amendments are expected this spring.

For more information on the subject of this bulletin, please contact the author:

Footnotes

1. Chaoulli v. Québec (Attorney General), [2005] 1 S.C.R. 791.

2. Charter of Human Rights and Freedoms, R.S.Q., c. C-12, s. 1.

3. Canadian Charter of Rights and Freedoms, Part I of the Constitution Act, 1982, which is Schedule B to the Canada Act, 1982 (U.K.), 1982, c.11, s. 7.

4. L.R.Q. c. A-28.

5. L.R.Q. c. A-29.

6. A non-participating physician is a physician who practices outside the public health-care system; therefore patients alone assume payment of his or her fees. In Québec, physicians are not allowed to devote part of their practice to the public health care system while participating as a physician in the private system.

7. Specific conditions will be created for cancer-related surgeries.

8. These suppliers would be subject to agreements entered into at the national level.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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