The premiers aren’t fairly asking for a clean verify from Ottawa on well being care funding. They’d like for the federal Liberals to pencil within the quantity of $28-billion earlier than handing it over, thanks very a lot.

That instant infusion, plus a steep annual enhance thereafter, is required to extend the federal authorities’s share of well being care funding, they declare. Provincial and territorial leaders are rejecting the concept Ottawa can impose any situations on that largesse: The federal authorities ought to pay up, then shut up.

The premieres are deceptive Canadians concerning the diploma of Ottawa’s underfunding. Even worse, their calls for for a strings-free spending spree, if profitable, may find yourself slowing down desperately wanted reform of Canada’s overly costly, underperforming well being care system.

Any enhance to federal well being care grants has to begin with an correct evaluation of Ottawa’s present contributions.

The premiers’ criticism goes one thing like this. As soon as upon a time, the federal authorities shouldered half of well being care prices, however that share has declined and now sits at simply 22 per cent. Federal funds to the provinces are slated to hit $45.2-billion this fiscal yr, however they need to instantly leap by $28-billion to push Ottawa’s share of well being care spending to 33 per cent. After that, the federal authorities ought to assure an annual enhance of 6 per cent, twice as large as the present legislated minimal.

It’s true that federal money transfers for well being care, whereas rising yearly, now account for a smaller share of nationwide spending. However these focused money transfers are simply a part of the image. Practically a half-century in the past, Ottawa lower private and company taxes so the provinces may elevate theirs, ceding tax factors that develop in worth because the economic system expands. The federal authorities appropriately factors out that its share of well being care spending already sits at 33 per cent, as soon as the worth of these tax factors is included.

There are additionally focused well being care measures that will additional increase Ottawa’s share. A major omission is the federal equalization program, value $21.9-billion this yr. Not all provinces obtain funding however this system’s objective is to offer poorer provinces the means to fund public providers – together with well being care. Whereas it is not possible to parse how a lot of equalization flows to well being care, these billions indisputably add to Ottawa’s spending share.

None of that’s to absolve Ottawa from its accountability to assist finance the reform of the well being care system. Canadians ready for hours in emergency rooms, and ready years for household docs, do not care a lot about which degree of presidency is ready to declare the higher hand within the funding debate.

However an correct accounting does matter in that it’s a crucial first step in avoiding the fiscal distortions that will outcome if Ottawa have been to accede to the premiers’ demand for $28-billion, a rise within the federal money switch of greater than 60 per cent . (Over the subsequent decade, the 6-per-cent annual escalator would imply a whole lot of billions of {dollars} in further federal well being care spending.)

The instant impact of an enormous increase in well being care transfers could be so as to add to the underside traces of the provinces and territories, to not improve providers. Even when they have been so inclined, no province or territory may discover a solution to spend these additional billions of {dollars} within the subsequent yr, even two. Within the quick time period, the supposed well being care switch would merely go to pay down the money owed of subnational governments.

Ultimately, nonetheless, provinces would rise to the problem of sloshing that $28-billion into well being care budgets. With current historical past as a information, a lot of that cash would go to rising salaries of well being care staff, to not bettering providers. And such a fast infusion of money would dissipate no matter momentum exists for a basic reconsideration of how Canadian well being care works – or moderately, just isn’t working.

In that gentle, Ottawa’s place that ties new funding to a nationwide well being knowledge system is sensible. So it does push for objectives in key areas of reform, together with household well being and long-term care. Such a system needn’t be run by Ottawa. The Canadian Institute for Well being Data may administer the information system, avoiding any intimation that the provinces require the supervision of the federal Liberals.

Setting objectives is probably the most crucial a part of the equation. These objectives ought to purpose to alleviate chokepoints and to extend Canadians’ entry to early – and cheaper – intervention. Extra on that tomorrow.