Unvaxxed Quebecers should pay portion of their health-care bill—so should everyone else

After Premier François Legault announced plans to tax Quebecers who refuse to be vaccinated for COVID-19, opposition quickly came from various precincts. Justice Centre for Constitutional Freedoms vowed to challenge the tax in court while organizations such as Black Health Alliance warn that such a tax may disproportionately affect low-income people including Black and Indigenous residents in the province. While the ultimate fate of this tax remains unclear, it’s brought an important question to the forefront of the Canadian conscience.

To what extent should we be financially responsible for our personal health-care choices?

To be clear, so-called sin taxes are nothing new. Governments have imposed taxes on products (alcohol and cigarettes) deemed harmful to the consumer and society alike for centuries. That’s not to say such taxation is necessarily good policy. Sin taxes have historically produced a disproportionate financial burden on poorer households (particularly in the short-run). And there are legitimate concerns about state intervention on personal choices made by individuals in a free society.

In most cases, the direct cost of these choices (smoking, for example) are borne by the individual via lower incomes, reduced quality of life and potentially shorter life spans. But everything changes in the context of a publicly funded health-care system where society bears the medical costs of the individual.

Part of what makes Canadian Medicare (and health insurance more generally) work is the cross-subsidization healthy Canadians provide to unhealthy Canadians, especially when the unhealthy end up in critical care. Providing for the unpredictable costs of expensive care for our fellow citizens remains desirable in a caring society. But what should be done when the medical costs to society of individual decisions are predictable, like with smoking, drinking and remaining unvaccinated?

Private insurers account for this problem in two ways. First, they can charge higher premiums to individuals who pursue activities that will likely lead to higher future health-care costs. This is essentially what Premier Legault wants to replicate, but unlike a competitive insurance market, the province’s system does not allow Quebecers to opt out and shop around for alternative plans (although some private insurance is available in addition to the public plan for select medical services). A second and more direct approach is to simply expect patients—vaccinated or otherwise—to share the cost of (any) medical treatment.

While such an approach may seem radical, it’s actually the norm in almost every universal health-care system in the world. In Switzerland, for example, patients must pay a deductible (equal to roughly C$400) and 10 per cent of the cost of treatment. Dutch citizens must pay the first of what amounts to roughly C$540 for care, while the French are expected to pay about 30 per cent of the costs of outpatient care (20 per cent for inpatient care). In all three countries, annual caps, subsidies or exemptions for vulnerable populations prevent payments from becoming an excessive financial burden.

Not only do these cost-sharing payments incentivize patients to make better health-care choices, they depoliticize the delivery of health care to an extent. While the definition of “vulnerable” groups exempted from cost-sharing payments may be determined by the political process, in this type of system governments don’t need to decide which activities should or should not be penalized (again, something the Legault government plans to do). Instead, all members of society are financially incentivized to make good health-care decisions while broad safety nets prevent anyone from falling too far due to their poor decisions or bad luck.

Unfortunately, Ottawa explicitly prohibits this common-sense policy of patient cost-sharing by threatening to withhold part or all of any province’s federal money for health care. As a result, premiers such as Legault resort to more blunt and divisive policy instruments including sin taxes for the unvaccinated (or in Premier Jason Kenney’s case, $100 gift cards to encourage vaccination in Alberta) to incentivize the health-care choices of individuals for the benefit of society.

Whether Legault’s tax ultimately survives remains to seen. However, the discussion about the tax has highlighted a serious flaw in our health-care system—the lack of financial incentives for individuals to make good choices, and the resulting costs to society.