ASSOCIATION OF DALHOUSIE RETIREES AND PENSIONERS
VOLUME 1, NUMBER 2, AUTUMN, 2002Click here to go back.
NOTICE OF GENERAL MEETING.
The next General Meeting will be held at on
MEDICARE AFTER KIRBY COMMISSION
Tarun Ghose, President
All retirees are justifiably concerned about the
future of our healthcare. The hiatus between the Kirby (i.e. Senate)
Commission’s report and the expected publication of the Romanow
report towards the end of this month may be an appropriate time to initiate a
debate among ourselves on the future of
I shall start by reassuring that contrary to what has
been widely publicized, Medicare is not terminally ill. Medicare has its
problems but their seriousness and the level of public disaffection are
exaggerated. For example, Statistics Canada’s July, 2002 report shows that
about 80 percent of Canadians are satisfied with the present level of Medicare
service. Medicare also does not have an “out of control” spiralling cost. The
cost of Medicare has been around 10 percent of our gross domestic product
I disagree with the Commission’s enthusiasm for
privately delivered hospital-care in the guise of introducing competition,
efficiency and fiscal accountability into the system. Private (for-profit) healthcare systems are
neither more efficient nor qualitatively better than our exclusively publicly
funded Medicare. For-profit
health-insurers and their chain of satellites (e.g. insurance brokers, consultants,
system analysts, lawyers, etc.) skim off their administrative costs and profits
so that less than half the amount is left for patient care. For-profit
healthcare in the
I am glad that Mr. Kirby has backed away from users’
fees. Small “barrier” users’ fees are supposed to discourage “frivolous
overuse” but there is no evidence of such overuse. However, such fees do
discourage healthcare use by the lower-income groups (who fall ill more
frequently, more seriously and in larger numbers than upper income groups) and
make patients seek help when disease is advanced, necessitating more extensive
(and expensive) treatment. Other models
of users’ fees such as charging for services not included in “basic core
medical services” (?) or Medical Savings Accounts or MSAs
(in which the government annually allocates a lump some of money for
individuals and families for purchasing healthcare services) do not save much
but shift scarce healthcare resources from the sick to the healthy and from the
poor to the relatively affluent. All
users’ fees breach the Canada Health Act. Unfortunately, at present, only about
70 percent of healthcare is publicly funded in
Polls show that Canadians realize that universal and high quality healthcare in an aging society will be expensive but they are ready to pay the cost which may need 2.5 percent of real increase per year. But the Commission is right that it will be a folly to throw money at Medicare without resolving its root problems i.e., i) budgetary shortfall resulting from cuts and rising costs, and ii) organizational inefficiency. Medicare needs changes to control costs and improve the quality of care.
The cost of prescription drugs is the fastest growing
and also the single most expensive item in Medicare’s budget. The most
important cause of soaring drug price is patent protection which allows
monopoly drug-pricing based on whatever the market can bear. The majority of prescription drugs used in
Because patients (or insurers) fully pay for their
prescription drugs when not hospitalized, about 3.5
million Canadians without any drug insurance, have to be content with an
expensive diagnosis but no treatment.
Only in this context the Commission’s recommendation for a “catastrophic
drug programme” makes sense but this is not a definitive solution. According to the Prime Minister’s National
Forum on Health, drug prices can be controlled best by introducing universal pharmacare, bulk purchasing of drugs, eliminating
over-prescribing (which costs Canadian hospitals about 250 million to1 billion
dollars per year) and introducing reference-based pricing (i.e., use of the lowest priced but equally
effective drug). As regards the cost of universal pharmacare,
the Forum has pointed out that the public sector already pays for about 40
percent of prescription drug costs and various types of existing drug insurance
programmes cover a sizable proportion of the remaining. Let us hope that the
multinationals and their patent protector, the World Trade Organization, will
be persuaded to lower drug prices by popular and political pressure, as was
done with the pricing of anti-AIDS drugs in
In our healthcare budget, the cost of prescription drugs is closely followed by the costs of hospital services and physicians’ remuneration. The Commission is right that the present fee-for-service method of doctors’ remuneration is inefficient because it is geared to generate adequate income for doctors. A system of capitation fee or a salary system with performance-enhancing incentives will allow planning of long-term budgets, and introduce into the system accountability, quality control and impetus for continuing education. Evidence-based evaluation of doctors’ services will save costs by eliminating unnecessary consultations and procedures. However, it is surprising that after denouncing “the fee-for-service method” of payment for doctors, the Commission recommends the same method for paying hospitals.
The Commission is right in recommending that the
Federal government should provide funds for increasing the intake of students
in medical schools. The present physician shortage is the result of cuts in the
intake of medical students and trainee residents that started in 1992.
(Emigration of doctors is almost fully compensated by medical
immigration). However, medical education
has to be affordable and accessible to all income groups. Physician shortage
has distorted physicians’ remuneration and impeded the development of
Kirby Commission’s recommendation for guarantee for timely access to care is commendable because this is the single most common complaint against Medicare. However, long waiting periods are not due to workforce shortage alone. For cutting down waiting, we have to decide how much resources can be allocated to create the reserve capacity for dealing with fluctuating demands.
The most serious structural problem of Medicare dates
back to The Constitution Act, 1867, which gave the provinces
jurisdiction over healthcare. As a result,
Other structural changes in Medicare for cutting costs and improving care include shifting care from expensive tertiary centres to intermediate and community-based healthcare units and finally to homecare. The present load on emergency facilities can also be reduced by round-the-clock services in community health centres managed by salaried physicians and nurses or by family physicians in group practice. At present we spend only about 4 percent of the healthcare budget on homecare. This is not adequate even for any decent homecare service let alone for further extending homecare to replace institutional care. Thus the Commission’s recommendation for additional allocations of 550 million dollars for homecare and 250 million dollars for palliative-care appear to be inadequate. However, the recommendation for fresh annual infusions of 5 billion dollars into the system to compensate for the long underfunding may be of help.
REPORT ON THE FINANCIAL HEALTH OF THE RTF
Paul Huber, Vice-President
Six months ago, in our joint report to the DFA, Faye Woodman and I refused to speculate whether a further special distribution of surplus to retirees might occur during this academic year. Our caution proved warranted. Financial markets had partially recovered from their post-Trade Center crisis when we drafted our report, but the two quarters since then have been disastrous. Funds with the asset mix of the Dalhousie Retirees' Trust Fund [RTF] lost about six percent of their value in the period from April through June and a further seven percent in the subsequent period through to the end of September.
The RTF did slightly better than this at -4.5 percent and -6.5 percent respectively. Since the RTF needs to earn over one percent per quarter-year just to maintain its level of surplus (measured at market values) in the absence of any indexation, its overall underperformance from 1 April through 30 September amounted to about -13 percent. Consequently, the RTF surplus (at market value) shrank substantially and now (30 September) amounts to about only about 4 million dollars, i.e., about three percent of liabilities. This disappearance of surplus clearly implies that there will be no special distribution to retirees this year.
Although financial markets sometimes change direction abruptly, you should not at this point plan on any further surplus distributions ever. Prudent Pension Advisory Committee Members will not recommend a special distribution to retirees when there is little or no genuine surplus to be distributed and financial markets are trending downward; nor will conservative Governors of the University agree to such a recommendation. And should -- in some ecstatic rave -- such a proposal go forward to the Provincial Superintendent of Pensions, it would not be approved.
The Pension Trust Fund's [PTF] situation is much
graver than that of the RTF. Its 84 million
dollar deficit (at market value) as at 30 June 2002 increased by September-end
to over 100 million dollars, more than one quarter of the PTF's
liabilities. The Pension Benefits Act of
Nova Scotia will require the Board to increase its pension contribution rates
to overmatch those of employees if a deficit prevails in the Dalhousie Pension
Indexation of pensions in January for those eligible has been approved by the RTF Trustees at the rate of 0.305 percent (except for those who are being indexed for the first time), which is less than the increase in the cost of living of 1.2766 percent. This under-indexation is driven by the three-year average RTF return of 5.355 percent less the indexation threshold of 5.05 percent. This marks the fifth occasion and the first time since 1996 when the RTF was unable to index pensions completely to the rate of increase of consumer prices. Previously “missing” indexation was made good in 1997; it cannot be predicted when – if ever – the new “missing” indexation of 0.97 percent will be made good. Indeed, because negative returns have prevailed in each of the last two years and RTF returns are averaged over a three-year period, indexation may be incomplete in 2004 and 2005.
Indexation arrangements at Dalhousie have thus far worked much better than ever anticipated in 1982 and have cost relatively little. You have had the good fortune that your pension funds participated in one of the longest (18 years!) bull markets in history and so earned returns up to 2000 that well exceeded historical norms. Surpluses in the RTF cannot generally be expected to arise; they came about in recent years because investment returns were unusually high relative to inflation.
DALHOUSIE BLUE CROSS PLAN COVERAGE FOR RETIREES
In the last
newsletter we brought to your attention the fact that the Dal
Blue Cross Plan provided for reimbursement to Dal
retirees (over 65) for 80 percent of their Pharmacare
drug co‑payments. Although this was an accurate and correct
interpretation of the Blue Cross/Dalhousie contract, it now seems that this
apparent provision was due to a mistaken interpretation of changes made in the
Plan by Blue Cross authorities (or their advisers) in 1995. Dr. Ghose and I met
with Mr. Roughneen and Mr. Crowell on
First, this Blue Cross error came to attention because in 2002 a few perceptive retirees realised that the Plan appeared to offer this benefit.
Second, Dal retirees have not been paying an increased premium over the past seven years for this inadvertent "benefit", of which most retirees were unaware.
Third, retirees will not be asked to reimburse Blue Cross for any monies received under this "benefit".
Fourth, it will be apparent from all the above that this "benefit" is no longer available!
A New Drug Plan? We explored with the Dal representatives whether a drug reimbursement plan could be considered in conjunction with Dal and Blue Cross. The latter have quoted on a plan which would provide coverage for 100 percent of the 20 percent Pharmacare co‑pay to an annual maximum of $400 reimbursement. The premiums would be $19.04 per month for singles and $44.35 for families.
My own immediate reaction was that retirees would find this plan unappealing. However, we would appreciate feedback from our readers. (I should add that Blue Cross would likely require the participation of 75 percent of those retirees presently in the Dal/Blue Cross Plan as a condition of offering this drug plan.)
Dal/Blue Cross Travel Health Insurance? It appears that such a plan may be feasible, if certain important considerations are met.
First, that at least 75 percent of ADRP members, who are currently in the Dal/Blue Cross Plan must elect to join the Travel Plan.
Second, certain important limitations would apply, viz:
1. Coverage is limited to expenses incurred as a result of a sudden illness or accident, which occurs outside the participant's province of residence, during the term of the policy.
2. Blue Cross will not pay any benefit or accept any liability for claims relating to a medical condition /illness /injury which, within the six‑month period immediately prior to the date of departure from the participant's province of residence, has:
- deteriorated; or
- been diagnosed; or
- required medical consultation; or
- required hospitalisation; or
- required a change in medication.
My present understanding is that if the exceptions listed in 2 do not apply to you or your spouse/partner, coverage would be essentially complete as in 1. Further, note that coverage is not dependent on age, nor would the premiums increase for older retirees, (e.g., over 70), nor is there any limit on the number of trips per year, provided no single trip exceeds 180 days.
And The Premium? $5.70 per month for single coverage, $11.43 for family. If my understanding and assumptions about this potential plan are correct, I believe this to be a good plan. Note that if there is a reasonable consensus (75 percent or more) of those potentially involved, to add on a drug plan and/or travel plan, then Blue Cross would insist that ALL participants in the Dal/Blue Cross Plan would pay the extra premium and would have the benefit of the additional coverage (drugs, travel or both) as voted by 75 percent or more of participants. Note also that there is NO intention at the present time to offer the Dal/Blue Cross retirees plan to any retiree who did NOT elect to continue their participation at retirement.
We hope to identify
those ADRP members, who currently participate in the Dal/Blue
Cross Plan and will seek their opinion.
Please let us know your opinion, and state whether you are presently in
the Dal/ Blue Cross Plan by filling out the following
and returning it by e-mail to email@example.com
or by post to ADRP Office, Room 2831, Life Sciences Centre,
Are you currently a Member of the Dal/Blue Cross Plan? Yes No
Are you interested in the Drug Plan as presented above? Yes No
Are you interested in the Travel Plan as presented above? Yes No
SOCIAL COMMITTEE REPORT
Expenses ‑ Please note the annual fee -- our only source of revenue, covers the coffee supplied at meetings. To defray costs we are asking members who enjoy our coffee to make a contribution of their own choosing.
Neptune Theatre presents “Preview Nights” -- First three nights of any new play (Tuesday, Wednesday and Thursday) at Tickets: $25 Main Stage, $18 DuMaurier Theatre
Flat rate only – BOOK EARLY (429‑7300)
Symphony Nova Scotia presents four “Open Rehearsal Series” in their “Celebrity Series” at – Rebecca Cohn Theatre: Oct. 8, Nov. 5, March 4, April 22. Tickets: $14. Each or $56 for all 4 Flat rate only – BOOK EARLY
General Information ‑ A “Program for seniors” booklet prepared by the N.S. Senior Citizens Secretariat may be obtained free at drugstores, Sobey’s, municipal libraries and Access Nova Scotia government offices.
Walking ‑ Keep fit
by joining the twice a month walks organized by the Chebucto
Hiking Club. The walking club runs all year and walks are 10km in length. Walks are held in various localities
throughout HRM. Organized walking tours in the Canadian Rockies and
4 pm Seasonal Gathering – University Club.
Topic: Income Taxes, RRSP’s vs. Annuities, plus other tips.
Rebecca Cohn Theatre on
Chaplin. The film “Limelight”. Discussion and coffee following.
Next golden oldie movie:
This series is organized by Sid Sodhi.
The ADRP wishes to receive feedback regarding activities of interest to Members. Please check off the following in which you would participate. Feel free to add suggestions. Reply by e‑mail: firstname.lastname@example.org Or mail to ADRP Office, Room 2831, Life Sciences Centre, Dalhousie University, Halifax, N.S. B3H 4J1.
Art Gallery Tour ___________________________
Book Reading Group ___________________________
Bus Tour ___________________________
Exercise Group ___________________________
Harbour Boat Tour ___________________________
Neptune Theatre ___________________________
Old/Classic Movies ___________________________
Pot Luck Dinners ___________________________
Shut In Visits ___________________________
Social Gatherings ___________________________
Symphony Orchestra ___________________________
Walks – Nature/Historical ___________________________
Your name:_____________________________ Phone number: _______________________
Your response will help the Social Committee plan for ADRP activities.
REPORT FROM THE KEEPING IN TOUCH SUB-COMMITTEE
Dorothy Moore, Chair
This Committee was recently formed to respond to the concerns voiced by several ADRP members about our lack of knowledge of those Dalhousie retirees who have not, so far, joined the Association. The ADRP is the vehicle which can bring us all together for betterment of our retirement circumstances; it can also foster ways in which we can contribute to the life of the University and the community.
After years of dedicated service to the University, the intellectual capital represented by all of the retirees can continue to benefit Dalhousie. We can also benefit each other and enrich our retirement with a continuing awareness of the accomplishments and changing circumstances among those who have retired.
This Sub‑Committee of the Communications Committee would like to learn of important events in the lives of all retirees, which can be inserted in this Newsletter. So we invite everyone to submit brief notes on news items such as:
- awards and recognitions
- major accomplishments during retirement
- milestone birthdays (80, 90, 95, 100, etc.!)
- wedding anniversaries (50, 60, etc.)
- recovery from a serious illness or surgery
Since the number of retirees is large, we also depend on the cooperation of others to pass on news of retirees to this Sub‑Committee; and we also solicit information from Departments, Schools, Faculties and any other Dalhousie employees. You may contact us by leaving a brief message (including your own telephone number), on the answering machine in the ADRP office; or alternatively on mine; ADRP Office (902) 494‑7174 or e‑mail email@example.com, Dorothy Moore (902) 494‑1185 or e‑mail firstname.lastname@example.org
We are looking for more volunteers to serve on this Sub‑Committee, so please contact either of these if you wish to participate.
PENDING CHANGES TO
Retirees who removed their contributions from the Dal Pension Plan and invested the locked-in portion in a Life Income Fund will find the following, quoted from Davies Diary by John Davies, Investors Group, of interest.
Following is a brief summary of the changes to the Life Income Fund Rules:
- The requirement that a LIF must be converted to a life annuity contract by the end of the LIF owner’s 80th year is being eliminated. The LIF will be able to continue for the owner’s lifetime.
- The method of determining the LIF maximum annual payment has been revised. It will be very similar to the calculation of Quebec LIFs.
- A LIF owner who is between the ages of 54 and 65 will be able to receive “Temporary Income” from the LIF, which in most cases will provide a higher payment than the normal LIF maximum. The concept of Temporary Income is designed to allow more access to locked-in funds by retired individuals who are not yet eligible to receive Canada Pension or Old Age Security benefits.
- A LIF (or LIRA) owner who is at least 65 years of age will be able to withdraw all of the locked-in funds if the value of the client’s locked-in assets is less than 40 per cent of the Year’s Maximum Pensionable Earnings under the Canada Pension Plan. (In 2002, the YMPE is $39,000).
- The owner of a LIF (or LIRA) who wishes to withdraw amounts based on diminished life expectancy must now complete an Application Form which includes a Physician’s Statement.
HAVE YOU WORKED IN ANOTHER COUNTRY?
YOU MAY BE ABLE TO CLAIM BENEFITS
ADRP organized a
meeting on international benefits with Brian MacMillan
from Human Resources Development Canada.
The meeting took place on
Schemes such as
Canadian Old Age Security usually have a residency requirement of some
sort. For example, to claim the full
Canadian Old Age Security at age 65 you must have lived in
The HRDC website
lists the countries with which
www.hrdc-drhc.gc.ca. The phone number to call for information is 1-800-277-9914. Brian MacMillan can be reached directly at 426-4666.
Tarun Ghose and Alasdair Sinclair are
looking for volunteers and donations to assist with the organization of the
National Convention of Canadian University/College Retirees’ Associations to be
There is an
opportunity to volunteer your talents to reorganize a small library at the
office of Canadian Pensioners
We have e-mail addresses for less than half the ADRP Membership. To cut the cost of postage we would like to distribute this Newsletter to as many Members as possible by e-mail. If you have an e-mail address please let us know at email@example.com.
The ADRP intends to publish the Newsletter every three months. It is hoped the Newsletter will serve the following purposes:
- To provide pertinent information;
- To provide a forum for the free exchange of views on issues relevant to our Membership;
- To serve as a documentary record of matters relating to the ADRP.
The Editorial Board, under the ultimate direction of the ADRP Board, takes responsibility for the contents of the Newsletter. Signed contributions will take the form of short articles and letters to the editor which will normally represent the opinions of the author and need not represent the views of the ADRP. Anonymous material will not be considered for publication. The Editorial Board retains the right to edit or reject contributed material and to elicit similar and opposing views surrounding any issue raised.
The Editors Rosemary MacKenzie
The Editorial Board Rosemary MacKenzie
ex-officio Tarun Ghose
HOW TO CONTACT US?
By phone: 902-494-7174
By e-mail: firstname.lastname@example.org.
By post: ADRP Office, Room 2831 Life Sciences Centre,
N.S. B3H 4J1Click here to go back.