Analysis of 2020-21 Provincial Budget

What’s in Nova Scotia’s 2020-21 Provincial Budget for health care?

Summary

Overall, when it comes to healthcare this budget spreads small amounts of money across the province, includes increases slightly above the rate of inflation in most areas, offers no major new programming and neglects long-term and home-care. It does expand training for nurses and doctors and does so in a smart, targeted manner, and provides a significant (though inadequate) increase in support for children living in poverty.

On the whole, it is a stay the course budget for a public healthcare system which cannot continue on its current course.

Total health care budget increases from $4.712 billion to $4.822 billion

This year’s budget is an increase of 2.1% over the total projected 2019/2020 spending on health care. This overall increase keeps pace with inflation but does not offer a significant increase in real world dollars on health care.

People often talk about healthcare spending as dominating the budget, but this claim misses the larger problem. The Department of Health and Wellness (including money transferred to the IWK and Nova Scotia Health Authority) accounts for roughly 41.5% of the $11.6 billion budget, but the problem is not that we spend too much on healthcare, it is that we do not spend enough on other services that prevent people from getting sick in the first place. The consistent decrease in taxes at the provincial and federal level over the last three decades has created a revenue problem and services like social assistance and public housing have born the brunt of this under-funding. The solution is to re-invest in other priority areas, not to cut or freeze spending on health care. 

Creating a revenue problem

Nova Scotians are consistently told that there is not enough money to spend on social programs. From housing to healthcare, we are told that the cupboard is bare. However, this budget includes a giveaway to corporations in the form of a $81 million corporate tax cut. In addition, due to 2016 changes in the Canada Health Transfer formula negotiated in 2016 by the Nova Scotia Government, Nova Scotia will receive a projected $113 million dollars less in federal health funding, than they would have under the old formula. These changes to the Canada Health Transfer were agreed to by then Finance Minister Randy Delorey, the current Minister of Health.

Overall this means that the provincial government has chosen not to collect $194 million in revenue that could be spent on health care or other public services. If the cupboard is empty it is because policy makers refuse to fill it.

$75.4 million for Doctor’s Master Agreement

This is not new money, but instead money which is required to meet the obligations set out in the new Doctors Master Agreement announced in November 2019.

$4.7 million for addition training spots at Dalhousie medical school and  $700 thousand for 70 nursing Seats at Cape Breton University and Dalhousie Yarmouth Campus

These additional spots in medical and nursing school are a good step forward. In particular, we are pleased with the targeting of the medical school seats at under-represented groups and the opening of additional nursing seats in Sydney and Yarmouth, rather than in Halifax. We know that the best way to get health care workers to practice in rural and underserved communities is to recruit people from and train students in those communities. 

While we have concerns that training alone is not adequate without proper funding to employ graduates, we are hopeful that future budgets will expand on this training.

Increased spending for pharmacare programs

The total expenditure on pharmaceutical services and extended benefits will increase from $334.7 million to $340.3 million. While the government is touting this as a $20.9 million increase year-over-year, it is only a $5.6m increase over what was actually spent in 2019-2020. This budgeted increase includes changes in the formulary to cover more cancer treatment medications, but the increase is largely the result of normal inflationary costs increases associated with operating a drug plan, including increased administrative costs, formulary changes and increased costs of medication.

The Health Coalition is calling on the provincial government to work with the federal government to develop a universal, national pharmacare program which will drive down costs, provide coverage to all Canadians and simplify a patchwork system of public and private pharmacare plans.

Increased funding for NSHA and IWK

Funding for the Nova Scotia Health Authority, the government body which delivers the majority of health care services in the province including hospital and physician services, increases from $1.827 billion in 2019-2020 to 1.892 billion dollars in 2020-21. Funding for the IWK Health Centre, the hospital responsible for children and women’s health, increases from $228 million to $243 million. These modest increases exceed inflation, but do not recognize the ongoing problems caused by the chronic underfunding of front line services which over the years.

This funding includes $1.1 million dollars to fund the Human Organ Tissue Donation Act, the change to legislation which creates an “opt-out” system for tissue and organ donation to replace the previous “opt-in” system. This is an example of a low cost change in legislation which has the potential to save lives and we are happy to see funding allocated to ensure a smooth rollout.

Long-term care and home care

The province continues to neglect facility based long-term care. The 2020-21 budget offers no significant improvements in long-term care, including no funding to address the dangerously low staff-to-patient ratios, no funding to increase staff salaries or training to improve retention and quality of care, and no money for new long-term care beds. 

The ongoing crisis in recruiting and retaining continuing care assistants in both long-term care facilities and home care home support agencies is not being directly addressed with any new program spending. 

The total budgeted spending for continuing care will increase by an amount just above inflation, 2.36%. 

The combined neglect of long-term care and home-care is worrisome given the demographic challenges facing Nova Scotia. As our population ages, government cannot be in a position of reacting too late to changing healthcare needs, instead the province should be building public capacity to care for the elderly now.

Taxation and regulation on tobacco and e-cigarettes

The budget includes a new tax on e-cigarette(or ”vaping”) products, increased taxes on tobacco, and new mandatory licensing for e-cigarette retailers. These new taxes will not be a significant source of revenue for the province, raising a combined projected total of $19.7 million dollars. The primary purpose of these changes is to reduce smoking of tobacco and use of e-cigarettes, including among youth. The Coalition would like to see an investment in programs aimed to providing support for those who wish to stop smoking and further development of health promotion strategies aimed to reduce the number of people who start smoking in the first place.

Social determinants of health

This year’s budget features a significant improvement to the Nova Scotia Child Benefit and will ensure that tens of thousands more families qualify. An $18 million dollar increase in funding for the program is significant and will have a small but real impact on the lives of many children and families.

However, the government has once again frozen income assistant rates, which when accounting for inflation is a decrease in real dollars. Non-disabled recipients are once again forced to survive on just $648.92 per month, while disabled recipients will have to make ends meet with $912.92 per month. This continued neglect of some of the province’s most vulnerable residents has a clear negative impact on their health.

In addition, the funding for affordable housing does not include significant money for the construction of new social housing. Instead, it will use a combination of federal and provincial funding to repair existing social housing. The provincial government continues to rely on market-based, privately owned housing to try to address a growing crisis in housing affordability and availability. 

Poverty is one of the leading drivers of illness and this budget does too little to address it. The best way to improve healthcare in Nova Scotia is to make sure people do not become ill or injured in the first place and tackling income inequality and poverty are the most direct way to do so.