Any increase in private, for-profit health care in Calgary and across the province creates cross-Canada problems under the North American Free Trade Agreement. Analysts fear that allowing commercial, for-profit delivery of hospital and other health care services could collapse the weak protections currently available to public health care under NAFTA, and pry open the entire countrys health care system for US corporations.
International trade lawyer Steven Shrybman analyzed the NAFTA consequences of health care privatization schemes like Albertas Bill 11, now law. He shows Canada negotiated limited NAFTA coverage for health care that is open to interpretation covering health services to the extent that they are social services established or maintained for a public purpose. The terms social services and public purpose have not been defined in NAFTA.
The reservation does nothing to shield health care services from several of the worst NAFTA provisions those in Chapter 11 dealing with expropriation and compensation. While in theory a government could retreat from contracting out health services to private companies, that government would face the full force of foreign investor compensation claims for not just present, but future losses. The costs of compensation resulting from re-establishing a public system would be prohibitive.
In addition, the US is clear that as soon as health care services are supplied by a private firm on a profit or not-for-profit basis, they fall under NAFTAs rigorous investment and services rules. If NAFTAs dispute resolution process upholds this position and it is an enormous gamble to presume it wouldnt Canadas health care reservation would no longer apply to health care services that Alberta contracts out to private companies.
Under NAFTA, Bill 11 could well be the lever US corporations need to gain access to the entire Canadian health care system. This will be particularly true if the federal government condones Albertas scheme. Shrybman argues that federal government inaction on Bill 11 means foreign investors could insist on equally favourable treatment elsewhere in Canada, because of the national scope of federal health care programs.
If the federal government continues to fund Alberta health care services, foreign corporations could demand equally favourable treatment elsewhere in the country. Procurement exemptions may well not extend to federal-provincial transfers, leaving these open to demands for National Treatment and Most Favoured Nation Treatment.
Equally troubling, Albertas mixing of public and private for-profit providers exposes Canadian health care to further corporate erosion under the World Trade Organizations General Agreement on Trade in Services.