Morneau - Pensions

Question 1

Primary objective of the Canada Health Act.

Answer 1

Protect, Promote, restore the health of Canadians without financial or other barriers.

Question 2

Identify conditions for province to receive unreduced funding under the Canada Health Act. (5)

Answer 2

COMPREHENSIVE: covers all hospital & medical services
UNIVERSAL: covers all eligible residents
PUBLIC: requires administration by non-profit public authority
PORTABLE: between provinces
ACCESSIBLE: uniform terms & conditions for all eligible residents

Question 3

Does the federal government cover more or less than half of provincial health care costs?

Answer 3

LESS than half.

Question 4

Federal government mechanism for provincial medical funding.

Answer 4

Through transfer payments.

Question 5

Methods that provinces use to raise balance not covered by federal transfer payments for medical programs. (4)

Answer 5

• direct cost-sharing by residents & employers (eg: ON)
• payroll tax (eg: ON)
• general revenue (eg: NB)
• tax on group insurance plans (eg: ON)

Question 6

Tax treatment of individual premium payments to PROVINCIAL health insurance premiums.

Answer 6

Individual payments are NOT tax deductible.

Question 7

Tax treatment of employer payments to PROVINCIAL health insurance premiums.

Answer 7

Employer payments are taxable.

Question 8

Tax treatment of employer premium payments to PRIVATE health insurance premiums.

Answer 8

Payments are NOT taxable, (except for Quebec).

Question 9

What is the reason for the inception of WC (worker’s compensation) insurance?

Answer 9

COURTS: overwhelmed by rapid industrialization and workplace accidents
VICTIMS: needed prompt medical & financial assistance

Question 10

What is the underlying insurance principle of WC insurance?

Answer 10

No-fault insurance.

Question 11

How is WC funded?

Answer 11

WC insurance is funded by the employer.

Question 12

Explain individual liability in WC insurance regarding: operation, funding, and where used.

Answer 12

OPERATION: by WC boards
FUNDING: each employer is self-funded based on claims history
WHERE USED: public agencies

Question 13

Explain collective liability in WC insurance regarding: operation, funding, and where used.

Answer 13

OPERATION: by WC boards
FUNDING: each industry class (based on activity & risk) is assessed collectively based on claims history
WHERE USED: non-public industries

Question 14

EI (Employment Insurance): Objective

Answer 14

• income replacement (temporary)

- re-employment assistance

Question 15

EI: Financing

Answer 15

• generally (employer, employee) = (50%, 50%)

- some programs funded by general tax revenues

Question 16

EI: tax treatment with respect to premiums, benefits

Answer 16

PREMIUMS: 
employer = tax deductible
employee = tax credit
self-employed = 50% tax deductible
BENEFITS: taxable

Question 17

Reasons EI won’t be viable without government involvement. (3)

Answer 17

ADVERSE SELECTION: only those who are about to lose their jobs would buy the insurance
EMPLOYERS WOULDN’T CONTRIBUTE: they get no benefits, thus government must mandate coverage
COMPLEXITY: government already has necessary structures in place to facilitate operations

Question 18

How employee benefit plan qualifies for EI premium reduction? (4)

Answer 18

• employee benefits GREATER than EI benefits
• benefits START in 15 days
• benefits DURATION longer than 15 days
• employee compensation NOT REDUCED even if additional EI benefits are given in the same period

Question 19

How to return premium reduction to employees? (3)

Answer 19

• written agreement
• cash back on 5/12 of company savings
• increased benefits

Question 20

Disqualifications for EI. (3)

Answer 20

Employment disruptions:

• Dismissal with cause
• Quit
• Strike