Who holds the blame for problems with the Public Service Health Care Plan?

The unions representing public servants say the federal government should have done more to ensure a smoother transition when the country's largest health care plan switched to Canada Life last summer.

Around 1.7 million federal workers, retirees and their dependents saw their insurance provider switch from Sun Life on July 1.

With it came changes to what services and drugs are covered, how they're approved and what happens when they need to talk to an agent.

CBC has heard hundreds of stories from people now having problems with long wait times, failing to get through to an agent or being denied a claim without explanation.

The Public Service Alliance of Canada (PSAC) compares the switch to the adoption of the Phoenix pay system, which left workers underpaid, overpaid or not paid at all.

"They can't pay their employees properly and now they've completely buggered up their benefits. That's just totally unacceptable," said Chris Aylward, PSAC's national president.

"We were expecting delays with the simple transition from one provider to another because of the size of the plan. We certainly were not anticipating the number of problems or the scope of the problems."

The Professional Institute of the Public Service of Canada (PIPSC) said responsibility ultimately rests with the federal government, which procured the contract and is solely responsible for the benefit plan.

Unions do not have the ability to grieve issues with benefits.

"We don't have any levers or mechanisms to make Canada Life meet its obligations. The employer holds the contract with Canada Life. They have the service standards and it's for them to make sure they are delivering on the contract," said Jennifer Carr, national president of PIPSC.

PSAC and PIPSC, along with smaller federal worker unions, sit on a committee that negotiates changes to the benefit plan with representatives of the Treasury Board of Canada Secretariat (TBS).

That process is separate from collective bargaining and doesn't involve a vote by union members.

Benefit plan changes

The Treasury Board, which oversees labour relations between the federal government and the public sector, said changes made to the plan, including claim limits and coverage terms and eligibility, were approved in the fall of 2022.

The changes were independent of the switch to Canada Life, which won a tender to administer the plan, and took over as the plan's administrator the same day the changes came into effect.

Changes to the Public Service Health Care Plan involve several coverage increases, though it does introduce new limits related to drug coverage — including a cap on dispensing fees and a requirement for a pre-authorization for high cost medications — and physiotherapy.

Other than those changes, many plan members said they were told their coverage would remain the same and the transition would be seamless.

24/7 call centre among union suggestions

Union leaders say the biggest problem is still the lack of staff and long delays to get through to an agent at Canada Life, along with claims being denied.

Another public sector union, the Canadian Association of Professional Employees, said it would have liked to see a trial period or running of parallel systems before Canada Life was given the sole responsibility to administer the plan.

PSAC said it recommended a 24/7 call centre well before the July 1 switchover, a request that still hasn't been answered. However, Canada Life did announce it would be expanding its call centre and hiring more agents after months of complaints from plan members.

For its part, PIPSC said it's concerned delays that were evident in the early "positive enrolment" period weren't adequately addressed.

Carr said unions should have been brought into the process earlier.

"There's lots of lessons that could have been learned [from Phoenix]. If unions are at the table and we have a say, it's a lot easier," she said.

She added that the government should not use average call centre wait times as the main measure of the quality of Canada Life's service. Instead, she said they should also measure the number of claims that have been denied and the time it takes to pay out claims.

'Unacceptable' delays

Treasury Board President Anita Anand, who replaced Ottawa-Vanier MP Mona Fortier in the role in late July, said she is speaking directly with Canada Life leadership about the "unacceptable" delays. 

Anand, who was minister of public services and procurement in the Phoenix aftermath, said the government has learned lessons from Phoenix. 

"The Government of Canada … was very much on top of the contractual obligations that Canada Life has with the Government of Canada, as well as the way in which some of the unpredictable difficulties were going to be addressed as soon as possible," she said in a press conference last week.

In a statement to CBC, the Treasury Board said they are having daily discussions with Canada Life to better understand members' situations and provide additional guidance where required.

It also said anyone who has had a claim denied can appeal it to the PSHCP Administration Authority.

The more than half-a-billion dollar contract was awarded to Canada Life after "an open, fair, and transparent competitive procurement process," Public Services and Procurement Canada (PSPC) wrote in an email.

It said the contract allows for a six-month "adaptation period," along with an opportunity to make required changes and the company's service-levels are being monitored.

"Both the Government of Canada and Canada Life are focused on resolving ongoing challenges experienced by some members," PSPC wrote.

Smaller change than Phoenix

While the problems with the switchover to Canada Life have been likened to Phoenix, University of Ottawa professor Stephane Tywoniak, an expert in government procurement, said the scope of the change is much smaller.

"Here we only have a change of provider for essentially the same service," he said. "I believe changing health service coverage is a routine operation in many businesses."

Though he provided the caveat that his expertise isn't in insurance administration, he noted Phoenix included the centralization of staff, recalculation of compensation and an entirely new information technology product.

In a statement, a Canada Life spokesperson said the company recognizes some people are experiencing difficulty accessing their benefits, leading to high call volumes and wait times.

The spokesperson said the company is "aware that in some cases, exceptional coverage over and above the plan design was granted to individuals."

For that reason, the company said it has "established a special team of claims examiners to review declined claims and ensure those who were granted exceptions previously continue to receive coverage for the medications and treatments they need."

Canada Life said it is implementing a customer service action plan and is prioritizing claims to ensure those experience financial hardship and urgent needs are processed first.