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.

Just Posted

UPDATED: East Zeballos placed under evacuation alert as “out of control” wildfire approaches homes

BC Wildfire Service says rolling debris on steep terrain poses danger to firefighters

Heat and smoke raises health risks

Rick Stiebel - Sooke News Mirror Health risks arising from heat and… Continue reading

Victoria police seize over one kilo of fentanyl, guns and cars

Andrew Ritch is facing charges of drug trafficking and firearm offences

Student group seeks cap on international tuition fees

UVic increased international fees 20 per cent for 2018-19

New marijuana regulations questioned

A smokescreen for opposition to legal pot, say some critics

B.C. wildfires 2018: Hazy skies impacting crews in spotting new fires

18,000 people are on an evacuation alert, with 3,000 homes under an evacuation order

Red Cross now accepting donations for those impacted by B.C. wildfires

The Canadian Red Cross is asking for help now and in the weeks and months ahead.

Court rules against City of Nanaimo, fire safety enforcement order denied

Supreme Court of B.C. initially made the order last month in Nanaimo

B.C. program to educate parents reduces ‘shaken baby syndrome’ by 35%

Period of PURPLE Crying was launched nearly a decade ago

Off duty fire chief douses suspicious fire while teaching son to drive

Sooke fire concerned over second suspicious bin fire this year

B.C. golfer, just 23, scores the rare albatross

Six-million-to-one shot a first for the Terrace club

Former Nanaimo CAO Tracy Samra now working for First Nation in Vancouver

Ex-city manager listed as Musqueam chief administrative officer, according to NEB filing

Independent Investivations Office looking into Sayward crash

An incident in which a vehicle under RCMP scrutiny crashed near Sayward… Continue reading

Fredericton widow swears at Trudeau during condolence call

Widow of man killed in Fredericton shooting says she swore at Trudeau during condolence call.

Most Read