Thank you, Mr. Speaker. Mr. Speaker, I would to address concerns raised by some Members of this Assembly about the proposal to return administration of the Non-Insured Health Benefits Program to the federal government. I appreciate that Members are very concerned about the impact of any change in program delivery on the quality of health care services provided to their constituents.
The Non-Insured Health Benefits Program is a national program funded by Health Canada, which provides specific benefits for status Indians and Inuit. Health Canada determines the type and extent of benefits that will be covered. Benefits under this program include specific drugs, dental work, various equipment and supplies required for medical treatment, vision care, eyeglasses, and co-payments for medical travel.
When the responsibility for health was transferred from Canada to the Government of the Northwest Territories, our government agreed to administer this program for the federal government. We provide the services directly to status Indian and Inuit residents and recover the costs from Canada through monthly billings.
This arrangement worked for several years. However, over the past few years, our government has been losing money. Health Canada has been disallowing a number of our claims. In other words, we pay the full costs up front, but when we send the invoice to Canada, they do not always reimburse us for the full amount. This is due to a number of reasons, including changes to the national NIHB policy by Health Canada and differing interpretations of the terms of the agreement.
In addition, our agreement with Health Canada has not provided sufficient funding to cover the administrative burden of delivering this program.
We estimate that our government loses about $1 million each fiscal year through a combination of disallowances and unfunded administrative costs. The department has attempted to resolve these issues through discussions with Health Canada. However, no resolution was reached and we have become increasingly frustrated with the time and resources spent trying to recover our expenditures under the program. For this reason, Cabinet and the Financial Management Board directed that the Department of Health and Social Services should not renew our agreement to administer this program for Health Canada. The department's main estimates have been reduced by $5.5 million to reflect this decision.
Mr. Speaker, let me be absolutely clear about one thing. We are not "giving this program" back to Canada. Authority for the Non-Insured Health Benefits Program was never transferred to this government. All we are proposing to do is to get out of a contractual administrative arrangement that has resulted in our government subsidizing a federal program to the tune of $1 million per year.
Health Canada was advised in October 2000 that our government would cease to administer the Non-Insured Health Benefits Program unless satisfactory arrangements could be made to ensure that our government would not be footing Health Canada's bills. Since then, the two departments have been working closely together to try to resolve the outstanding issues.
Mr. Speaker, over the weekend I received an update from my staff on their most recent discussions with Health Canada. I am pleased to report that Health Canada has agreed to compensate us for $800,000 of disputed billings, and is currently reviewing a further $700,000 worth.
Health Canada has also agreed to consider providing the Government of the Northwest Territories with additional administrative funding. We are still negotiating the details of such an arrangement. However, let me be clear -- we want full compensation for the costs of administering this program.
If we are able to reach a satisfactory arrangement, I will be recommending to Cabinet and the Financial Management Board that we enter into a vote 4-5 arrangement to deliver the Non-Insured Health Benefits Program for one additional year. During this period, we would monitor program administration very closely to ensure that the terms of the agreement and the funding received are sufficient to cover the full cost of administering the program.
Mr. Speaker, I am hopeful of a successful resolution of our discussions with Health Canada, and I will continue to keep Members apprised of our progress. Thank you, Mr. Speaker.