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Ontario Health Minister Deb Matthews speaks to the media at the Royal York Hotel in Toronto on March 15, 2013.Peter Power/The Globe and Mail

A federal government decision to cut health care coverage for some refugee claimants is actually more expensive in the long-run than simply paying for their benefits upfront, Ontario Health Minister Deb Matthews is warning in the latest salvo in the back-and-forth turf battle between the province and Ottawa.

In 2012, Ottawa clawed back health care funding for refugee claimants from 37 democratic countries – people who, the federal government says, are likely to be making "bogus" claims. Asylum seekers whose claims are turned down are also cut off.

To the federal government's chagrin, Ontario decided to reinstate health coverage for all refugee claimants and pick up the tab itself. Ms. Matthews said Friday it is less expensive to allow these people full access to the health care system – where they can get preventative treatment – than to only give them care in emergencies.

"Let's just pause for a moment and think about what the implementation of [the federal cut] means for frontline providers. It means that they have to say 'sorry, pregnant woman about to deliver baby, you're not covered, we're not going to care for you,'" Ms. Matthews said at a health promotion event in Toronto. "Do you really think our health care professionals will do that? Of course they will not, they should not, they cannot. So in the end, we were paying anyway but we were paying more than we would have had we provided better early care."

In the case of a child with a fever, for instance, Ms. Matthews said, it is cheaper for the system if that child is checked by a doctor early on than if it waits until the condition is so bad, it must visit an emergency room.

But federal Immigration Minister Chris Alexander fired back, arguing that providing health care for all refugees will only encourage those without legitimate claims to come to Canada.

"It will force Ontario taxpayers and their families to line up for care behind failed asylum seekers, and it will make Canada – and Ontario in particular – a bigger magnet for bogus asylum seekers in the future," he said in a statement.

Earlier this week, Mr. Alexander said the money spent on benefits for refugee claimants without valid claims would be better used to help people with legitimate asylum claims travel to Canada.

"We're very conscious of the fact that the most vulnerable, the most needed, the most impoverished, don't make it on our shores. They don't get a ticket on Air Canada. They don't even have a passport to make it, and they certainly don't show up in our airports. Those are the people we want to dedicate most of our resources to," he said in an interview. "We were not able to do that in this pre-reform era because so much of our resources were absorbed by bogus claimants."

The health change is part of a larger overhaul of immigration policy designed to reduce the number of false claimants. Asylum seekers from the 37 countries also face fast-track hearings designed to eject as many people with bogus claims as possible, to clear the way for legitimate refugees.

But Ms. Matthews charged that the federal government cutting off health care to people from those 37 countries before evaluating their claims effectively means denying them benefits that they might deserve.

"The Immigration Minister is calling people bogus before they have completed the process. That's kind of stunning in my opinion," she said. "If they are bogus, so-called bogus, then it's his department that is responsible for that refugee policy and the system. We are covering people while they are going through that process."

The fight largely turns on questions of jurisdiction. While Ontario accuses the federal government of shirking its responsibilities by downloading some refugee costs to provincial health care systems, Ottawa says the province is playing on its turf by interfering in immigration policy.

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