Finance Minister Carole James is beginning to phase out Medical Services Plan premiums, which accounted for 17 per cent of B.C. health care spending in the past year. (Tom Fletcher/Black Press)

Finance Minister Carole James is beginning to phase out Medical Services Plan premiums, which accounted for 17 per cent of B.C. health care spending in the past year. (Tom Fletcher/Black Press)

End is near for B.C. medical premiums

Break of $900 a year for average working couple, other taxes going up

The B.C. government takes its first step toward eliminating Medical Services Plan premiums on Jan. 1, slashing single adult rates by half and eliminating the need for new residents to register.

The NDP government is implementing an election campaign promise first made by the B.C. Liberals, who tinkered with Canada’s only user fee for medical services for years before announcing plans to phase it out last spring.

The Canadian Taxpayers’ Federation calculates that the reduction will save an average household with two adults $900 per year, and applauds the NDP government’s promise to eliminate MSP entirely within four years.

Kris Sims, B.C. director for the CTF, notes that the MSP break will soon be offset by tax increases, including the first increase in five years to B.C.’s carbon tax. That tax rises to $35 per tonne of carbon dioxide emissions as of April 1, translating to an increase from seven to 8.5 cents on a litre of gasoline and more than 10 cents per litre on diesel fuel.

Finance Minister Carole James announced in September that the NDP government is going beyond the 50-per-cent cut to MSP promised by both parties in the May 2017 election. She said the B.C. Liberal pledge to apply the rate cut only to those with household incomes below $120,000 is “unworkable,” and announced plans to scrap the income-tested application form.

Single adults with income above $26,000 and couples with two children earning more than $35,000 will still have to pay the reduced rate in 2018, on a sliding scale based on household income.

Phasing out MSP leaves a large hole in the province’s health care budget. The finance ministry estimated last year that income from medical premiums covers 17 per cent of health costs, by far the largest operating expenditure in the B.C. government, and James has yet to say how the revenue will be made up.

Eliminating MSP also means the phase-out of its administration and bill collection, which was contracted out to U.S.-based back-office specialist Maximus Corp. in 2005. Maximus took over existing administration staff represented by the B.C. Government Employees’ Union, and had to add more staff after B.C. assessed penalties on the contractor for slow service to the public.

The NDP has long opposed MSP as an unfair tax that has the same rate for people earning $45,000 and $450,000 a year. For government and large corporation employees, it is generally a payroll tax paid by their employers, while self-employed and small business workers have to pay it out of pocket.

BC legislatureHealthcare

Just Posted

FILE – Perry Bellegarde, National Chief of the Assembly of First Nations, takes part in an event on Parliament Hill in Ottawa on Tuesday, July 7, 2020. THE CANADIAN PRESS/Sean Kilpatrick
Indigenous Peoples Day must be a ‘call to action’, says Assembly of First Nations chief

Discovery of children at Kamloops residential school site must lead to change, Perry Bellegarde says

A tent housing a mobile vaccination clinic. (Interior Health/Contributed)
Over 5K jabbed at Interior Health mobile COVID-19 vaccine clinics

The clinics have made stops in more than 40 communities since launching last week

Provincial Health Officer Dr. Bonnie Henry talks about B.C.’s plan to restart the province during a press conference at Legislature in Victoria, Tuesday, May 25, 2021. THE CANADIAN PRESS/Chad Hipolito
Interior Health COVID-19 cases falling slower than the rest of B.C.

More than a third of provincial cases announced Thursday came from the Interior

A tent housing a mobile vaccination clinic. (Interior Health/Contributed)
Second dose vaccinations accelerating throughout region: Interior Health

To date, more than 675,000 doses have been administered throughout the region

Okanagan Lake (File photo)
Thompson-Okanagan ready to welcome back tourists

The Thompson-Okanagan Tourism Association expects this summer to be a busy one

The border crossing into the United States is seen during the COVID-19 pandemic in Lacolle, Que. on February 12, 2021. THE CANADIAN PRESS/Paul Chiasson
VIDEO: Border quarantine to soon lift for fully vaccinated Canadians

Eligible travellers must still take multiple COVID-19 tests

Chilliwack secondary school’s principal is apologizing after a quote equating graduation with the end of slavery in the U.S. was included in the 2020-2021 yearbook. (Screenshot from submitted SnapChat)
B.C. student’s yearbook quote equates grad to end of slavery; principal cites editing error

Black former student ‘disgusted’ as CSS principal apologizes for what is called an editing error

Skeena MLA Ellis Ross. (Photo by Peter Versteege)
BC Liberal leadership candidate condemns ‘senseless violence’ of Okanagan church fires

Skeena MLA Ellis Ross says reconciliation isn’t about revenge for past tragedies

A coroner’s inquest will be taking place at the Capitol Theatre in Port Alberni for the next week. (ELENA RARDON / ALBERNI VALLEY NEWS)
Teen B.C. mom who died following police custody recalled as ‘friend to many’

Police sent Jocelyn George to hospital after intoxication had gone ‘beyond the realm’ of normal detox

FILE - In this Nov. 29, 2020, file photo, Las Vegas Raiders defensive end Carl Nassib leaves the field after an NFL football game against the Atlanta Falcons in Atlanta. Nassib on Monday, June 21, 2021, became the first active NFL player to come out as gay. Nassib announced the news on Instagram, saying he was not doing it for the attention but because “I just think that representation and visibility are so important.” (AP Photo/John Bazemore, File)
Nassib becomes first active NFL player to come out as gay

More than a dozen NFL players have come out as gay after their careers were over

Penticton Indian Band Chief Greg Gabriel speaks to the Sacred Hearts Catholic Church burning down early Monday morning, June 21, 2021. (Monique Tamminga Western News)
Penticton band chief condemns suspicious burning of 2 Catholic churches

Both Catholic church fires are deemed suspicious, says RCMP

COVID-19 daily cases reported to B.C. public health, seven-day moving average to June 17, 2021. (B.C. Centre for Disease Control)
B.C.’s COVID-19 infections drop to 90 on Sunday, 45 Monday

Pandemic spread dwindles as 77% of adults receive vaccine

By protesting uninvited in First Nations’ territories, conservationists are acting in a neocolonial or paternalistic manner, says Huu-ay-aht Chief Robert Dennis. Photo by Heather Thomson
A closer look: do Vancouver Island First Nations support the war in the woods?

First Nations/environmentalist old growth alliance uneasy, if it exists at all

A blood drive in support of 1-year-old Rielynn Gormley of Agassiz is scheduled for Monday, June 28 at Tzeachten First Nation Community Hall in Chilliwack. Rielynn lives with type 3 von Willebrand disease, which makes it difficult for her to stop bleeding. (Screenshot/Canadian Blood Services)
Upcoming blood drive in honour of Fraser Valley toddler with rare blood condition

The Gormley family has organized a blood drive in Chilliwack on June 28

Most Read