People protest outside the Tendercare Living Centre long-term-care facility in Scarborough, Ont., on Dec. 29, 2020.Nathan Denette/The Canadian Press
Carolyn Hughes Tuohy is a professor emeritus at the University of Toronto’s Munk School of Global Affairs and Public Policy. She is the author of Federalism as a Strength, a recently published paper by the Institute for Research on Public Policy.
The ravaging effects of the pandemic in Canada’s nursing-home sector have sparked demands for federal funding and “national standards.” But provincial governments have jurisdiction over long-term care. How do we achieve a common threshold of provision while respecting Canada’s federal system?
There are several potential benefits to federalism in financing and delivering long-term care. A nationwide pool can broadly share the “longevity risk” that individuals will outlive their savings and be unable to afford private care. But long-term care is also an inherently hands-on set of services intimately interwoven with daily life. That makes provincial and local governments best suited to operating programs that respond to local economic and social circumstances. That varied local experience can provide a base of information for learning about best (and worst) practices.
However, province-specific programs can result in inequitable variation across jurisdictions, while fragmented authority can make it difficult to share, in a timely fashion, the comparison data on which learning depends.
Canada’s experience of the pandemic has exhibited more of the downsides than the upsides of federalism in long-term care. There has been wide variation and limited learning across provinces. As of mid-September, 2020, for example, Ontario’s COVID-19 fatality rate per 100 long-term care residents was about four times that of British Columbia. Meanwhile, the federal government has had a limited and passive fiscal presence; Canada Health Transfer funding includes an essentially unconditional amount for long-term care. The federal government’s fall economic statement includes $10-billion to be transferred to the provinces over three years for this purpose as well, with the requirement that the provinces report on how it is spent. But the lack of federal leverage was already apparent in the early 2000s, when conditional federal funding for provincial home care simply reinforced the status quo.
Fortunately, we have working models of federal-provincial co-operation that involve genuine joint decision-making and buy-in from both levels of government in areas of “concurrent jurisdiction.”
The Canada Pension Plan, paralleled by the Quebec Pension Plan, is jointly managed by federal and provincial governments. It provides a dedicated source of public finance, funded by contributions from workers and employers. It is designed to be sustainable and sensitive to demographic change, in contrast with the periodic haggling around the Canada Health Transfer. And it makes sense to think of a model of public finance for long-term care as more akin to a retirement benefit than to health insurance. People over age 65 account for about 44 per cent of overall government health care expenditures in Canada but more than 90 per cent of residents in long-term care. Living past 80 carries about a 30-per-cent chance of requiring long-term institutional or home care – a risk that escalates sharply as one ages past 85. Expenditures for long-term care, unlike those for acute health episodes, are ongoing in support of daily life. A steady pension-like benefit stream makes sense.
A long-term care insurance (LTCI) benefit could be attached to the CPP/QPP as a supplementary benefit. It would pay out a capped cash transfer to the beneficiary, set according to the level of health need as assessed through existing provincial mechanisms. Unlike the CPP/QPP, the benefit would be assignable to a qualifying third-party provider of institutional or home care, as chosen by beneficiaries in consultation with their local assessing agency. Some of this benefit could reduce out-of-pocket costs, especially for lower-income beneficiaries, but most should be integrated with existing provincial funding to increase and upgrade capacity. Additional federal government spending would be required to add a similar supplementary long-term care benefit to the Old Age Security/Guaranteed Income Supplement pension tier, to cover those whose work history does not yield sufficient CPP/QPP coverage. Comparable programs already exist in countries such as Germany, the Netherlands and Japan.
The benefit would also identify eligible providers according to quality criteria, using existing provincial standards at the outset. Over time, Ottawa and the provinces would work jointly through the LTCI plan to raise and harmonize quality standards, drawing on the analysis of information submitted by providers as a condition of their participation in the plan.
COVID-19 has sparked creativity in other areas of society. We need to be equally creative in finding new ways to bring the full advantages of our federal system to the pressing issues of long-term care.
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