Alternative federal budget 2026: Health care

Introduction

Strengthening public health care played out as a minor issue in the recent federal election, despite three-quarters of Canadians saying health care is in crisis, according to an Environics poll conducted for the Canadian Health Coalition.¹

Prime Minister Mark Carney pledged to continue the main public health care programs ushered in during that last parliamentary session: stable funding for the Canada Health Transfer to provinces and territories, the Canadian Dental Care Plan, and universal national pharmacare.

The Liberal election platform contained other health care spending promises, including $4 billion for urgently needed improvements to health care infrastructure, such as hospitals. Nevertheless, the activist government agenda to deal with the public health care crisis is likely now “in the rear-view mirror,” according to observers.²

With his pledge to cut income taxes while making major increases for the Department of National Defence and other security-related budget lines, there may be little room for new health care initiatives. Indeed, Prime Minister Carney could be faced with a difficult choice of driving the deficit upward, increasing taxes, or making deep cuts to other areas of spending.

Carney focused on a short list of priorities in his mandate letter to Cabinet members—none of them were about public health care. “Bringing down costs for Canadians and helping them to get ahead,”³ was one priority, signalling that new initiatives on health care will be judged on the basis of improving affordability for Canadian families. This challenges those who are working to end the public health care crisis to wedge their demands into solving the affordability crisis or risk being lost in a sea of low-priority policies and programs.

Overview

Two important programs of the previous government, dental care and pharmacare, are incomplete. Both will require additional funding in this budget and beyond if they are to provide equal coverage to people based on medical needs—not on their ability to pay or the region in which they live.

Canadian Dental Care Plan

A welcome addition to our public health care system, the Canadian Dental Care Plan is federally funded and privately administered (unique in our mostly provincially run system) without requiring bilateral funding and performance agreements with the provinces and territories.

More than two million people have received publicly funded treatment from a dentist of their choice enrolled in the program. However, the plan departs from other public health programs in that patients must meet numerous criteria in order to qualify, including a yearly household income of less than $90,000 and no access to private insurance, such as benefits provided through employer plans.

Pharmacare

The year 2024 was most significant in a generation or more of public health activists advocating for public coverage of prescription medications outside of hospitals. There were two achievements: the hard-fought Bill C-64, The Pharmacare Act, received Royal Assent in October, 2024; and budget 2024 included $1.5 billion for bilateral agreements with provinces and territories to provide public coverage of contraceptives, diabetes medications, and related products.

Although not as ambitious as the landmark Hoskins Report, The Pharmacare Act retains the single-payer approach consistent with Canadian Medicare, which was a key recommendation of the 2019 Final Report of the Advisory Council on the Implementation of National Pharmacare led by Dr. Eric Hoskins.⁴

Bilateral pharmacare agreements were inked with Manitoba, British Columbia, Prince Edward Island, and Yukon before the election was called.⁵

Prime Minister Carney and his minister of health have pledged to continue pharmacare negotiations with the remaining nine provinces and territories. But concern is growing that the progress on signing new bilateral agreements is slowing.

Mental health funding

The previous federal government committed funding of $2.5 billion annually until 2032 for the provinces and territories to address four health priorities, including mental health and substance use. However, a review of the bilateral agreements conducted by the Canadian Mental Health Association demonstrated that the median of new federal money for mental health is just 5.7 per cent, with Prince Edward Island, Manitoba, and British Columbia not spending anything on mental health.⁶

Public health care services for all migrants, including undocumented people

Many temporary residents and undocumented people living in and contributing to Canada are excluded or face significant barriers to universal health care coverage. This is a denial of their human right to health and results in significant avoidable negative health outcomes.⁷

Health human resource strategy

The government must address the health care staffing crisis so everyone can access a family doctor or nurse practitioner and get the care they need. A health human resource strategy needs to be integrated into a public health care system that opposes privatization and outsourcing of health care, and that properly regulates virtual care.

Actions

The AFB will make the Canadian Dental Care Plan consistent with the principles of the Canada Health Act by removing what is known as “means testing” to determine eligibility. As a first step, the income cut-off will be removed, allowing 4.4 million more Canadians to qualify for the plan, at an estimated cost of $1.45 billion.

In future years, the AFB will allow patients the choice whether to use their private, employer-provided insurance plans or to access the Canadian Dental Care Plan.⁸

The AFB will continue to negotiate pharmacare agreements with the nine remaining provinces and territories, and following the report on the expert committee mandated by the Canada Health Act, it will expand the list of medicines covered by agreements with provinces.

The AFB will, in conjunction with provincial and territorial governments, increase the funding for mental health services to at least 12 per cent of the health services budget, as recommended by the Canadian Mental Health Association.⁹

The AFB will guarantee universal provincial/territorial health coverage to all migrants living in Canada regardless of immigration status, including for people who are undocumented, as well as culturally informed mental-health services (see Immigration chapter).

The AFB will legislate national standards for Interim Federal Health Program and direct provider compensation to remove barriers to care and medication for refugees and refugee claimants (see Immigration chapter).

The AFB will make a commitment to strengthening patient care, reversing privatization, and solving the health care staffing crisis. It will fund a comprehensive health human resources strategy that:

Includes funding for public colleges and universities to increase training capacity
Promotes a wide range of health care professions as rewarding career paths to ensure a steady influx of health care talent
Ensures that health funds transferred to the provinces are used to provide underpaid health care workers, including personal support workers, with a minimum wage of $25 per hour

The AFB will ensure that bilateral health agreements also tie federal funding to caps on the usage of agency nurses and other health care professionals, and require provinces/territories to boost permanent positions within the public system.¹⁰

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Alternative federal budget 2026: Health care

Building true Canadian sovereignty

Introduction