Seniors call for changes to MSP premiums

Retired employees association calling for elimination of MSP Premiums for seniors.

Medical Services Plan fees are placing a burden on seniors and should be eliminated, says a Mid-Island retired employees association.

The Nanaimo Mid-Island Branch of the B.C. Government Retired Employees Association says the fees are straining seniors on a fixed income and pensions.

The association says eliminating MSP Premiums for seniors is the main goal but the ultimately it would like to see them eliminated for all residents. The Union of British Columbian Municipalities also called for the elimination of MSP Premium for seniors during its convention in September.

Instead of charging the premiums the association wants the costs to be recovered through the income tax system, creating a system where the more a person makes the more they pay. British Columbia is the only province that funds the health-care system through this kind of model; Alberta eliminated its health premium in 2008. However, Ontario has a health premium as part of its income tax system.

Lawrence Johnson, chairman of the Nanaimo Mid-Island Branch of the B.C. Government Retired Employees Association, said the fees are straining seniors on a fixed income and pensions.

“It has been a significant burden on seniors across the province,” said Johnson.

Johnson said MSP Premiums are a regressive tax and everyone above a certain income level is paying the same amount regardless of the differences of income levels. Premium assistance is available to lower income residents based on income level and family composition. People or families earning $30,000 or less qualify for varying rates, with those earning up to $22,000 qualifying for 100 per cent assistance. Johnson said the problem is when the rate is calculated for people earning more than $30,000. A person or family of three or more making over that amount pays the full rate, which means someone earning $30,000 will pay the same amount as someone making $100,000 or more.

According to spokesperson from the Ministry of Finance fully exempting seniors from MSP Premiums could be viewed as unfair to younger British Columbians.  The rates are also reviewed and adjusted periodically to reflect the rising cost of health care and that people in need are protected. The spokesperson said B.C. have one of the lowest tax burdens in the country.

However, the Johnson said the fees have doubled over the last 10 years and that has negatively impacted the retirement extended health benefits of its members.

MSP Premiums remained unchanged for seven years and then were increased six per cent in in both January 2010 and 2011. The fees are scheduled to increase another six per cent in January 2012.

MSP Premiums represent about 11 per cent of the annual health-care budget. In 2010 the fees generated $1.8 billion for the health-care system.