On paper, the new federal dental care program sounds like something designed to give night terrors to the NDP.
Rather than universal coverage, the program works around the edges of existing benefits, focusing on those without private insurance. The benefit is income-tested, with co-payments (clawbacks by another name) rising for better-off households, and disappears altogether for those families with an annual adjusted net income of $90,000 or more.
And, miracle of miracles, Ottawa is not setting up a federal Department of Dentistry stocked with hundreds of bureaucrats. Instead, a private insurance company, Sun Life, will administer the program. And that private company will send government funds to other private companies: dental practices. That payment model builds in fairly sturdy fraud prevention – a needed pivot away from the year-old pilot program that sent money to qualifying households, sometimes in advance of any services being provided.
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That’s not to say there aren’t some concerns with the new program. One is the design of the co-payments, which from the initial information provided by the government looks like it will result in odd inequities. No co-payment is required from a family with an adjusted net income of $69,999. A family earning one dollar more must pay 20 per cent of the cost of government-sponsored dental care. That dollar could result in hundreds of dollars in dental expenses.
There are worries among dentists about what Ottawa’s presence on the scene will mean for the price of dental services. It doesn’t take much imagination to conjure up a scenario in which the federal government pushes for reductions, or at least freezes, to limit the costs of the program.
And then there is the substantial cost of the program itself. Even with a limited scope and with co-payments, Ottawa says it will spend $13-billion in the first five years, and $4-billion annually after that. That hefty price tag is justifiable, but it’s incumbent on the Liberals to find economies elsewhere in the budget. (Ratcheting back the explosion in civil service numbers would be a good start.)
Still, the dental benefit does represent a decisive – and long overdue – break with the health care status quo. To sum up: the new federal benefit is an income-targeted measure, paid to and delivered by the private sector and requiring that wealthier Canadians pay part of the cost of their health care. And the NDP proclaims itself to be delighted.
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Undoubtedly, part of that is just posturing. The NDP can rightly take credit for pushing the Liberals into launching a dental benefit. But the party also needs to demonstrate that its parliamentary alliance with the Liberals is a political winner. Walking away from the deal because the dental benefit isn’t in line with the current cumbersome model of Canadian health care would be unsound tactics.
But it’s likely that the NDP will pressure the Liberals to subsume the dental benefit into the broader, and at demonstrably outdated, health care framework. The Liberals should resist that pressure, and indeed go further by using the same approach for any expansion of pharmacare, the details of which are still being negotiated with the NDP.
An income-tested pharmacare program that filled in some of the gaps in private-sector insurance coverage and avoided a public-service hiring spree is fiscally plausible, given Ottawa’s current budget situation. Anything else would destroy any possibility of fiscal restraint.
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But there is no reason to limit the policy innovation of the dental benefit to new programs. It can be a blueprint for reform of the broader health care system. Co-payments are an effective way to focus Ottawa’s resources on those most in need, while still helping out middle-income households. (Indeed, that same principle can be found in the design of Old Age Security payments, although the clawback rates are far too generous.)
Focusing government’s role on providing funds rather than services is a clarifying example. If a private company can be more efficient in delivering those services, governments should not be afraid to embrace those savings. Kudos to the federal Liberals – and, to be fair, the NDP – for defying the progressive dogma that private health care is immoral.
Whether by design or by chance, the Liberals and their NDP allies have decisively undermined some of the worst delusions that are preventing innovation and reform in Canada’s health care system.