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

Harrison Hot Springs country singer Todd Richard poses for a photo with Mission firefighters. (Photo/Sarah Plawutski)
VIDEO: Harrison country artist Todd Richard plans for a busy, rockin’ summer

Richard and his band look to live shows as restrictions start to lift

The theme for this year’s Fraser Valley Regional Library Summer Reading Club is “Crack the Case” and Katie Burns, community librarian at the Chilliwack Library, is encouraging people of all ages to sign up. She is seen here at the Chilliwack Library on Friday, June 18, 2021. (Jenna Hauck/ Chilliwack Progress)
Crack the case, read, win prizes with FVRL Summer Reading Club

‘Immerse yourself in other worlds and have a bit of fun while you do it,’ says Chilliwack librarian

Cpl. Scott MacLeod and Police Service Dog Jago. Jago was killed in the line of duty on Thursday, June 17. (RCMP)
Abbotsford police, RCMP grieve 4-year-old service dog killed in line of duty

Jago killed by armed suspect during ‘high-risk’ incident in Alberta

Holger Schwichtenberg and his son Philip talk in the barn of the 150-acre Schwichtenberg farm. This farm is one of many throughout B.C. that support more than 12,500 jobs across the province in the dairy industry. (Contributed Photo/B.C. Dairy Association)
Agassiz dairy farm a model of care for environment, animals, and family

Farm is part of a dairy sector centred in the Fraser Valley, supporting 12,500 jobs province-wide

Marco Mendicino, Minister of Immigration, Refugees and Citizenship during a press conference in Ottawa on Thursday, May 13, 2021. THE CANADIAN PRESS/Sean Kilpatrick
Canada to welcome 45,000 refugees this year, says immigration minister

Canada plans to increase persons admitted from 23,500 to 45,000 and expedite permanent residency applications

FILE – Most lanes remain closed at the Peace Arch border crossing into the U.S. from Canada, where the shared border has been closed for nonessential travel in an effort to prevent the spread of the coronavirus, Thursday, May 7, 2020, in Blaine, Wash. The restrictions at the border took effect March 21, while allowing trade and other travel deemed essential to continue. (AP Photo/Elaine Thompson)
Feds to issue update on border measures for fully vaccinated Canadians, permanent residents

Border with U.S. to remain closed to most until at least July 21

A portion of the George Road wildfire burns near Lytton, B.C. in this Friday, June 18, 2021 handout photo. THE CANADIAN PRESS/HO, BC Wildfire Service *MANDATORY CREDIT*
Blaze near Lytton spread across steep terrain, says BC Wildfire Service

Fire began Wednesday and is suspected to be human-caused, but remains under investigation

(Black Press Media files)
Burnaby RCMP look for witnesses in hit-and-run that left motorcyclist dead

Investigators believe that the suspect vehicle rear-ended the motorcycle before fleeing the scene

Join Black Press Media and Do Some Good
Join Black Press Media and Do Some Good

Pay it Forward program supports local businesses in their community giving

Cannabis bought in British Columbia (Ashley Wadhwani/Black Press Media)
Is it time to start thinking about greener ways to package cannabis?

Packaging suppliers are still figuring eco-friendly and affordable packaging options that fit the mandates of Cannabis Regulations

Blair Lebsack, owner of RGE RD restaurant, poses for a portrait in the dining room, in Edmonton, Friday, June 18, 2021. Canadian restaurants are having to find ways to deal with the rising cost of food. THE CANADIAN PRESS/Jason Franson
Canadian restaurateurs grapple with rising food costs, menu prices expected to rise

Restaurants are a low margin industry, so there’s not a lot of room to work in additional costs

RCMP crest. (Black Press Media files)
Fort St. John man arrested after allegedly inviting sexual touching from children

Two children reported the incident to a trusted adult right away

Most Read