Federal health spending has outpaced provinces, analysis finds

The findings stand in stark contrast to the rhetoric that has punctuated federal and provincial health negotiations over the last several years.

Despite castigation from provincial premiers over lagging federal contributions to health spending, an analysis of 20 years of health funding data shows that federal transfers have mostly outpaced increases to provincial health budgets.

In 2023, federal health transfers amounted to $47.1 billion, a 212 per cent increase over 2005, when the transfers were $15.1 billion. Total spending by all 10 provinces grew in that time to $221.9 billion up from $86.2 billion, an increase of 158 per cent.

The Canadian Press, in partnership with Humber College StoryLab, collected data on provincial health budgets and federal health transfers from 2004 to 2023 to track annual spending from the launch of the 2004 federal-provincial health accord under former Liberal prime minister Paul Martin.

The findings stand in stark contrast to the rhetoric that has punctuated federal and provincial health negotiations over the last several years, as health systems struggled in the aftermath of the COVID-19 pandemic.

Two years ago, a shortage of health workers led to emergency room closures and extreme backlogs for services across the country and premiers demanded the federal government pay a greater share of the health spending bill.

Former Manitoba premier Heather Stefanson, after a meeting with her fellow provincial leaders at the end of 2022, said health spending used to be split evenly but the federal share had slowly dwindled over time.

Governments originally envisioned that health-care costs would be divided evenly between Ottawa and provincial governments in 1959, before most provinces even had medicare. But the funding model shifted drastically in the 1970s and has changed again many times since.

Rather than slowly dropping off over the last two decades as the premiers suggested, the data shows federal transfers actually grew at a slightly faster pace than provincial health spending since the Martin health accord in 2004.