Province set to cancel medicare premium hike
B.C.’s finance minister is scrapping a planned four per cent hike to Medical Services Plan premiums, as the province starts to spend a larger-than-expected budget surplus, The Vancouver Sun has learned.
Mike de Jong said in an interview he’ll announce the change as part of a quarterly budget up- date in Victoria today. “You’ll see numbers and the surplus is up considerably,” he said, declining to reveal the exact figure until that briefing. “You’ll recall in the budget there was a scheduled further increase for MSP premiums for Jan. 1 of four per cent. That’s not going to happen. There will be no change.”
The move means a monthly MSP premium rate for an adult will remain at $75, instead of rising $3 to $78 on Jan. 1.
Those rates for those on premium assistance will drop an additional four per cent from what was planned, said de Jong. The move will cost B.C. almost $100 million a year, which de Jong said is possible because of the healthy financial figures.
“That’s one of the consequences of the improved fiscal situation,” he said.
Critics have long called for reform of B.C.’s MSP premiums, saying they are unfair because they are a flat tax and people pay the same amount whether they are wealthy or not. The plan does have exemptions for the poor and seniors.
Premier Christy Clark has called the MSP system unfair and antiquated, and pledged reform, but has not delivered an overhaul.
The tax pulls in almost $2.5 billion a year for the $48-billion provincial budget.
MSP premiums have increased almost 40 per cent the past five years.
The February provincial budget tweaked the Medical Services Plan, creating exemptions for children but also eliminating the discount for couples. Hardest hit was a couple with no kids earning more than $45,000 a year, who because of the elimination of the couples discount would have faced their monthly rate rising $20, to $156 from $136.
With the rate hike cancellation, that increase will drop $6, to $150.
“I am determined to make some more changes to MSP,” Clark told The Vancouver Sun’s Vaughn Palmer in August.
“It’s not progressive. It’s complicated. And it’s another burden that we put on families. ... Unfortunately, it’s turned out to be a very complicated thing to try and change, which I guess is why no government has ever done it or never really tried.”
Clark also noted that many working people in B.C. have their employers pay their premiums as part of labour contracts or terms of employment, and sudden alterations could mean large employers wouldn’t need to pay anymore.