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VICTORIA – Medical Services Plan premiums will be increased to help offset costly public-sector wage increases in health care, Finance Minister Gary Collins and Health Services Minister Colin Hansen announced today.
"Our government is committed to protecting and renewing patient care," Hansen said. "We have already increased health-care funding this year to $9.5 billion, a 13 per cent increase from the year before. Despite that increase, health authorities are facing significant financial pressures from escalating wage costs."
Collins noted that B.C. may receive federal equalization payments for 1999-2000, and that the possible reduction to "have-not" status highlights the enormous fiscal challenges the government faces.
"If we want to restore sound fiscal management, we cannot continue to fund growing wage costs without the revenues to support them," Collins said. "B.C.'s health-care workers are among the highest paid in the country. If our province is going to attract and retain the highly skilled professionals needed to protect patient services, we have to pay for those increases."
The new monthly MSP premiums will take effect May 1, as follows: Single people's rates will go from $36 to $54; couples, from $64 to $96; and families, from $72 to $108.
The government is also making MSP premiums more progressive to protect low-income earners, resulting in premium decreases for about 230,000 British Columbians.
The new premiums will increase the Ministry of Health Services budget next year to a projected $9.9 billion, and will provide $340 million in new revenues to health authorities to fund patient services, as well as $52 million for health authorities, school boards and post-secondary institutions to fund the cost of the premium increases for their workers.
Health sector wage costs are projected to increase by $325 million next year alone, and this does not include the cost of the pending arbitrated settlement for doctors.
"Even these added health resources may not fully cover the wage pressures health authorities face," Hansen said. "Health authorities will need to use the new flexibility and planning tools our government has provided to better manage existing resources. These include the ability to contract out administration and support functions, increase shared services, and reassign workers more quickly and efficiently to meet patient needs."
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For a table showing the impact of the premium changes on people of different income levels, click on http://www.prov.gov.bc.ca/prem/down/cabinet_submissions/msp_fact_sheet_1.pdf
For a fact sheet showing overall effects of the changes, click on http://www.prov.gov.bc.ca/prem/down/cabinet_submissions/msp_fact_sheet_2.pdf
Contact:
Finance Communications 250 387-3347
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