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Normandin Beaudry

Alberta to eliminate Health Care Premiums on January 1, 2009

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There, in black and white

Bulletin NB Vol. 11 N. 7, May 2008

On April 22, the Alberta government confirmed that it will eliminate premiums under the publicly-funded health care program effective January 1, 2009.

This bulletin is intended specifically for employers with employees in Alberta, because changes to benefits plans or internal policies may be required.

While delivering the province's budget on April 22, 2008, Alberta's Minister of Finance and Enterprise confirmed that premiums under Alberta's publicly-funded health care program (Alberta Health Care Insurance Plan (AHCIP)) will be eliminated effective January 1, 2009. This measure was announced in February 2008 during the last electoral campaign. Premiums for Alberta residents age 65 and over were abolished in 2004.

Annual AHCIP premiums for 2008 are $528 ($44 per month) for singles and $1056 ($88 per month) for families. No changes have been made to the premiums for 2008, which are therefore payable up to the end of the year.

Impacts and Considerations for Employers

Alberta employers who are currently paying some or all of the AHCIP premiums will benefit from savings resulting from the elimination of these premiums.

Some employers may be required to review the cost sharing arrangements for their group insurance plan if the plan takes into account AHCIP premiums. Alberta employers will also need to examine the relevance of revising their employee manuals and any other documents that make reference to the payment of these government premiums.

As regards to collective agreements, it would be wise to consider removing all clauses that refer to the payment of these premiums to avoid any recourse or future obligation on the part of the employer. It is worth noting that several Ontario employers found themselves in court following the introduction of the Ontario Health Premium because their collective agreements provided for the payment of the individual premium that was previously in place.

The elimination of AHCIP premiums could also reduce the obligation with respect to post-retirement benefit plans for employers paying a portion of these premiums.

Summary of Funding Methods for the Various Provincial Health Care Plans

Starting in 2009, only British Columbia and Ontario will charge an individual premium to fund their public health care plans. The table below presents a summary of the funding practices of each province, other than Alberta.  

   

 

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