Medical Travel and its effects on the cost of air travel

This was an exchange I had with the Minister of Health and Social Services in Committee of the Whole, February 14, 2017

Mr. SIMPSON: Thank you, Minister. My next question is on medical travel. How does the department determine what airline they’re going to be transferring patients with? Say if someone is in Hay River and needs to be sent up to Yellowknife. Well, obviously there’s only one airline now, but how is that determination made? Is there a standing offer? Is there some deal with a particular airline or is it open to the lowest bidder? Thank you, Mr. Chair.

HON. GLEN ABERNETHY: Thank you, Mr. Chair. Mr. Chair, I believe we have — actually, I don’t believe, I know we have standing offer agreements with airlines like Canadian North and First Air, whichever is the cheapest and the most appropriate for the time. So in Hay River the individuals would fly up on First Air and then if they need to go to Edmonton they would fly out on either First Air or Canadian North, whichever is cheaper. Thank you, Mr. Chair.

CHAIRPERSON (Mr. Blake): Thank you, Minister Abernethy. Mr. Simpson.

Mr. SIMPSON: Thank you, Mr. Chair. So theoretically if another airline wanted to come and start flying the route from Hay River to Yellowknife or Hay River to Edmonton, First Air or whoever you have the agreement with could just undercut them until that airline was no longer viable and the government would have to go with First Air because of the agreement and so it essentially keeps other airlines out of the market. Am I understanding this correctly? Is that how things would work? Thank you, Mr. Chair.

HON. GLEN ABERNETHY: Thank you, Mr. Chair. I believe it was in the last government that this particular standing offer agreement was established. It is reviewed every couple of years. I do believe the discussion around whether or not we go for standing offer agreements in the future is coming up. It might be six months. It might be a year. I can’t remember the exact date, but I know that it does have a finite time limit.

I will confirm what the duration of this particular standing offer agreement is. I hear the Member’s concern, but I could also argue that it might go the exact opposite. They have got a captive market as a result of the standing offer agreement. They might charge more.

Bottom line is, we look at this every couple of years. We try to figure out what is best for the North, best for the residents, and most affordable. I’ve had some individuals in places like Fort Smith suggest that it would be great to fly Northwest Air Lease rather than having to come up to Yellowknife, or in Hay River. Coming up to Yellowknife, it might be better just to fly direct. These are things that we’re looking at as we move forward in the future with the new standing offer agreement, should we choose to go that direction. It might be better if we just went lowest bid, whichever is most convenient to get us south, which might open us up to West Jet, or Air Canada, or Northwest Air Lease. I’m prepared to look at all options to help us control costs or medical travel. Thank you, Mr. Chair.

Mr. SIMPSON: Thank you, Mr. Chair. How do you get these conversations that happen where you say it would save the government money by not having a standing offer agreement? It just feels as though the market is really held captive by the standing offer agreements and no new airlines are going to start flying out of Hay River, is what I’m concerned about. That’s why it is $1,000 return for a 25-minute flight, and it seems like something has to change, and this might be the first piece now. This is something that I will be pursuing a little bit further, and I’ll follow up with the Minister to find out when the standing offer agreement is going to be looked at again. Thank you, Mr. Chair.

HON. GLEN ABERNETHY: Thank you, Mr. Chair. I’ll get the information update on when this particular round of standing offer agreements ends. As I said, I think we must be open to look at alternatives to ensure that medical travel remains as supportable as possible, but that we’re not adversely affecting other airlines or the existing airlines in any negative ways. I think we have to look at the market, for sure. Thank you, Mr. Chair.

Mr. SIMPSON: Thank you, Mr. Chair, and you might have to adversely affect some of the airlines, otherwise it’s protectionism, really, so you have to look at what’s best for the governments, and the bottom line, as well as, obviously, the services that you are providing. I guess that is the end of that line of questioning. Thank you, Mr. Chair.

HON. GLEN ABERNETHY: Thank you, Mr. Chair. I think we are agreeing. I think we need to look at it all, and think about the clients. With the health system moving to a single authority, one of the things that we’ve been very clear and consistent on is this is about client care. Our system needs to be client-focused and client-driven. Are we there? No, no. No, we are not. Can we get there? Yes, yes. Yes, we can. Do we have a lot of work to do? Yes. I think we have all heard frustrations people have had with medical travel, and clearly, we have got to be focused on trying to make sure that the experience is not negative and is positive, if possible, which means we have to explore all opportunities around airlines. Thank you.