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Minister of Health Jean-Yves Duclos packs up his notes after a news conference on the COVID-19 pandemic and other public health concerns, in Ottawa, on March 10. More than half of the money Ottawa is clawing back from seven provinces comes from Quebec.Justin Tang/The Canadian Press

The federal government says it is concerned about the rise in patients being charged by private clinics for virtual health care, and it announced that it is clawing back $82.5-million in health transfers to seven provinces, mainly for allowing private companies to charge for diagnostic services.

Federal Health Minister Jean-Yves Duclos said on Friday that an increase in virtual care appointments – a trend that took hold during the COVID-19 pandemic – has had some benefits. But he said patients must not be charged for services that should be covered by the public health care system.

“It is critical that access to medically necessary services, whether provided in person or virtually, remains based on medical need and free of charge,” Mr. Duclos told reporters in Ottawa.

Mr. Duclos said he will be speaking with his provincial and territorial counterparts about a “new interpretation” of the Canada Health Act that takes into account the changes in virtual care, as well as the expanding scope of practice of health care workers.

Ottawa also announced on Friday that it will claw back $82.5-million in funding sent to provinces through federal health care transfers, more than half of that from Quebec, in recompense for fees charged to patients in 2020-21 for services the government says should have been accessible at no cost under the Canada Health Act.

Some $76-million is for diagnostic services, such as ultrasounds, MRIs and CT scans. The remaining $6.5-million is for other patient charges, including those levied by private surgical clinics and for access to insured abortion services.

Quebec faces a $41.9-million clawback. The other two provinces hardest hit by the move are British Columbia, at $17-million, and Alberta, at $13.8-million. But because B.C. has implemented a plan to fix the problems that led to the extra billing, most of the money Ottawa is demanding of it will be returned.

Both Quebec and Alberta pushed back on the decision.

Antoine de la Durantaye, a spokesperson for Quebec Health Minister Christian Dubé, said the province is rebuilding its public health network, and that the private sector “must be complementary,” because it allows government to offer more care to Quebeckers.

“If it wants to serve Quebeckers, we believe the federal government should be putting more money on the table rather than taking it off,” Mr. de la Durantaye said.

Alberta Health Minister Jason Copping’s office said the province’s government fully supports the principles that underpin the public health system. But spokesperson Scott Johnston said Alberta already has a “robust audit system” to prevent extra billing or user fees.

He added that Alberta has requested a formal legal opinion on the federal government’s position, and will work with Ottawa on addressing the issue and “ensuring Alberta receives the full Canada Health Transfer payment that it is entitled to.”

In 2018, Ottawa told provinces and territories that diagnostic tests are covered by the Canada Health Act and gave them two years to address the problem of patients being charged fees for testing.

But in 2020-21, fees were still being collected in seven provinces, totalling $76-million. The same amount is being taken from their health transfers this month.

B.C.’s New Democrat Health Minister, Adrian Dix, blamed the proliferation of private MRI services on the previous BC Liberal government. He said the province has taken steps to increase capacity in the public system.

“There’s no level of government in Canada, no province, including the federal government, which has taken so much action and made so much investment to make the public health care system work,” Mr. Dix told reporters in Vancouver.

The federal New Democrats have raised concerns about the practices of private virtual care providers. They have pointed specifically to Maple, Canada’s largest virtual health app. NDP MP Don Davies tabled a motion in the House of Commons last month calling for Ottawa to close loopholes that allow for the growth of “two-tier health care” in Canada.

Maple chief executive and co-founder Brett Belchetz said he is profoundly disappointed in Ottawa’s announcement. He urged the federal government to work with private companies to deliver more efficient health care.

“It’s pretty clear that our health care system is certainly in a state of failure or near failure,” he said. “Clearly Canadians are in a mindset that [the] current status quo isn’t working and we need to really change things to make a difference.”

With reports from the Canadian Press, Xiao Xu in Vancouver and Eric Andrew-Gee in Montreal