Understanding Bill 2 and Healthcare Reform in Canada

Bill 2, a controversial piece of legislation aimed at improving access to healthcare, was passed by the Quebec Government under a gag order in late October. The bill will change the current payment system for physicians and tie a portion of their pay to their ability to meet performance targets in an effort to “establish collective responsibility”. It also imposes fines against physicians who take any collective action that might affect access to health services. These proposals have continued to generate considerable backlash; medical federations representing physicians in Quebec have already challenged the legislation in court, expressing concerns over the potential compromise to the quality of care patients receive and the need for adequate resources and staffing.

​Since the creation of Quebec’s public Health Insurance Plan, the majority of physicians and other specialists receive payment through the fee-for-service (FFS) model, where physicians submit billing and are paid for each service they provide. Under Bill 2, instead of payment solely through FFS, there would be a blended model, including hourly rates, FFS, and the capitation payment model. With capitation, physicians are paid a fixed amount per patient per year, and Bill 2 ties that amount to the vulnerability levels of patients; higher vulnerability means a higher fixed payment. By providing fixed compensation per patient, this payment model incentivizes practitioners to take on a higher volume of patients than with a solely FFS model.

 A collective supplement is also added to the new remuneration system, meaning that a portion (no more than 10%) of the pay received by physicians is dependent on meeting certain objectives set by the government. For example, the bill specifies that 16.5 million appointment spots must be made available per year, and that 95% of oncology surgeries must be performed within 56 days after request. If these collective targets are not met, then physicians’ salaries will be reduced. Additionally, any “concerted action” that might limit access to healthcare by stopping or slowing services will result in fines of up to $20,000 for individual physicians and $500,000 for groups. 

Much of the content of Bill 2 originated in Bill 106, introduced by Health Minister Christian Dubé in May of this year, sparking continued opposition and protest from physicians and medical federations; most notably, the suspension of all teaching for medical students in September. They argue that the proposed payment model places the burden of increasing access to healthcare solely on physicians without addressing systemic issues such as a lack of funding and staffing. While the legislation is meant to address the shortage of family doctors in Quebec, many medical professionals worry that increased pressure on physicians, through capitation and performance targets, may exacerbate the shortage and worsen the quality of care received by patients.

While the majority of physicians in Canada are paid through fee-for-service models, many provinces, like Quebec, are implementing alternative payment plans in an effort to address accessibility in healthcare. In 2023, British Columbia implemented the Longitudinal Family Physician (LFP) payment model, designed to help the province attract and retain family physicians by providing an alternative to FFS. In this model, physicians can bill for time spent on direct and indirect care, such as clinical administration, as well as for interaction and communication with patients. By implementing time and interaction-based payments, this model makes compensation more predictable for primary care physicians and incentivizes long-term care. While aiming for the same goal as Bill 2, instead of incentivizing a high number of patients, the LFP model encourages complex care over time.

​The government of Saskatchewan has also developed an alternative payment plan similar to the one outlined in Bill 2, focused on increasing access to family physicians. The proposed plan is another blended payment model including capitation and FFS. For capitation, the fixed amount paid per patient to physicians would be adjusted based on the complexity of care required, as well as the age and gender of the patient. This policy intends to move payment away from being solely based on the number of services provided and to attract more family physicians to the province by providing two different methods of compensation. While this is similar to the payment plan in Bill 2, it excludes pay tied to collective performance targets, placing less emphasis on patient volume.

​The main focus of these alternative payment plans is improving access to family physicians, usually by incentivizing working in family medicine. The need for greater interest in family medicine is clear; in Quebec, there are over 2 million people without a primary care provider, and 33% of surveyed Canadians reported not having regular access to one. An important aspect of these models is also sustainability, as burnout is high among medical professionals and especially high for those in primary care. Addressing shortages in family medicine will then also require addressing the working conditions and high demands faced by family physicians. The impact of new payment models on physician behavior will then be an important factor in the effectiveness of these reforms.

Blended payment models such as these have become a major part of provincial healthcare reform, since physician compensation is a fundamental part of healthcare policy. These payment models can be designed to address certain issues and incentivize higher-quality care, but the potential consequences can harm both doctors and patients. While there is some optimism towards increasing accessibility to primary care providers, the effectiveness of these new models is still unknown. It is clear, however, that collaboration between healthcare providers and policymakers is necessary to ensure a functioning system.

Edited by Kathleen Donnelly.