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For Immediate Release


March 5, 2002

Ministry of Health Services




VICTORIA – The government will give doctors a 20.6 per cent funding increase and has introduced legislation to end arbitration so it can work with doctors to determine how funds are allocated, Health Services Minister Colin Hansen announced today.


            "This is an extremely generous settlement, and one that reflects how highly we value the services doctors provide to patients," Hansen said. "We recognize that a fair and competitive compensation structure is critical in attracting and retaining physicians, just as it is for nurses and other health-care providers. To that end, our government has committed to honour the spirit of the interim arbitration decision."


Spending on doctors' compensation in 2002-03 will increase by 20.6 per cent over the amount budgeted for 2001-02. This is a total increase of $392 million for the coming fiscal year, an average of $50,000 for each of the 7,800 doctors currently practising in B.C., and includes:


§         $185 million in new funding for fee-for-service billings for 2002-03, an 11.6 per cent compounded increase. This new funding is based on a retroactive increase of 6.2 per cent on billings from April 2001 to November 2001, and a further 5.1 per cent increase on billings for the period to April 2002.


§         $80 million in new funding for on-call services as part of a new provincewide program that will be worked out together by the government and the B.C. Medical Association. This is an increase of 174 per cent from current on-call funding.


§         $127 million in new funding for alternative methods of payment, rural incentives, volume increases and other increases for the redesign of the medical system. The government will also extend the 6.2 per cent and 5.1 per cent retroactive payments in 2001-02 to doctors who are paid through salaries, service contracts and sessional payments.


With these increases, B.C.'s per capita expenditures on doctors will increase to $602 in 2001-02, 21 per cent higher than what second-place Ontario spends, and 34 per cent higher than Alberta.


Hansen emphasized that while these increases honour the spirit of the arbitrator's decision, further increases signalled by the arbitrator are not sustainable.  Therefore, Bill 9, the medical services arbitration act, repeals the Feb. 8 interim arbitration decision. It also removes clauses from three agreements between the province and the BCMA that allow for continued binding interest arbitration to settle outstanding compensation issues. All other provisions of these agreements, including those allowing for arbitration to interpret rights already settled, remain in effect.


"Our government is facing a $4.4-billion structural deficit," Hansen said. "We have increased total health spending by almost 20 per cent in the last two budget years alone, to $10.4 billion, yet cost pressures continue to grow. Clearly, these increases in health spending are not sustainable over the long term. Unfortunately, parts of the arbitrator's decision would make these structural problems even worse and do not allow us to direct health dollars where they are needed for patients."


For example, the interim decision increased funding for on-call service but signalled an on-call rate structure that provides incentives for solo or small practices that may lead to doctor burnout and gaps in service. The decision also made no provision for alternatives to traditional fee-for-service payments, such as service contracts or salaried payments, which many physicians, particularly new doctors, have requested.


Moreover, the interim decision binds government and doctors to continued arbitration in the future on a variety of other matters, creating the potential for even more cost increases that taxpayers cannot afford.


Hansen said government will meet with physicians and health authorities as soon as possible to discuss how the new funding will help doctors meet government's goal of providing British Columbians with the right health services, when and where they need them.


"Doctors have clearly told us that structural reforms are urgently needed, to save and renew our public health care system, and make it work for patients," Hansen said.  "The 20.6 per cent increase we have committed to doctors will allow us to begin to make those needed changes, while protecting taxpayers from the risk of further cost increases that are not sustainable.


"Doctors are an integral part of our health system, and we need to work together to renew health services so they work better for physicians and patients alike.


Further information, including a letter from Hansen to B.C. doctors, is available on the Ministry of Health Services Web site at www.gov.bc.ca/healthservices.                    




A letter from Hansen to B.C. doctors is available online at  http://www.healthservices.gov.bc.ca/negotiations/pdf/letter.pdf.


Two backgrounders are available online at http://www.healthservices.gov.bc.ca/negotiations/pdf/bg-physician.pdf and http://www.healthservices.gov.bc.ca/negotiations/pdf/bg-medical.pdf.





Communications Branch

Ministry of Health Services

250 952-1887



Visit the province's Web site at http://www.gov.bc.ca/ for online information and services.