British Columbia’s Health Care Costs Recovery Act (the “Act”) came into force on April 1, 2009 (the “InForce Date”). The Act allows the provincial government to recover the cost of health care services from tortfeasors whose wrongful acts caused injuries and necessitated the care. The Act gives the government both an independent right and a subrogated right (through the injured party) to claim these costs, and also allows a plaintiff to bring a claim on behalf of the government.  

While the Act clearly contemplates retrospective application, the scope of that restrospectivity is a source of contention between the government and insurers. The recent decision of Gosselin v. Shepherd (2010) provides the first consideration of these issues.

The Act and the Timing of the Injury

Due to the provisions of the Act and the two year limitation period for personal injury actions in British Columbia, the effect of the Act differs depending on whether injuries were suffered:  

  • more than two and a half years before the InForce Date;  
  • in the two and a half years before the InForce Date; or  
  • after the InForce Date.  

The application of the Act is also affected by whether:  

  • The claim was settled or tried prior to the InForce Date; or  
  • An action was commenced (and continuing) prior to the InForce Date.

The Act is clear that it does not apply where the matter was settled or tried prior to the InForce Date. Similarly, it is evident that the Act applies to injuries that occurred after the InForce Date and, in that case, the plaintiff is required to bring a claim on behalf of the government under the Act.

The Facts in Gosselin

The plaintiff was injured on June 7, 2005 and commenced an action for personal injury on March 1, 2007. Following the Act coming into force, she applied for leave to amend her statement of claim and include a claim on behalf of the government under the Act. The defendant opposed the amendment, alleging that the Act did not apply where the action was commenced before the InForce Date. The government-paid medical costs involved came to over $200,000.

The Government’s Ability to Claim Directly

Section 8 of the Act explicitly states that the provincial government’s independent right to claim costs, subject to discoverability, has a two and a half year limitation period. In Gosselin, the parties agreed the government’s independent right had expired.

For injuries that occurred at most two and a half years before the InForce Date (and for which the limitation has not yet expired) the Act allows the government to bring a claim.

The Gosselin Decision

The court stated that legislation must be very clear in order to have a retrospective effect. While s. 24(1) of the Act explicitly states that it applies to pre-existing injuries, the application to actions commenced before the InForce Date is severely curtailed by s. 24(2). In particular, while a plaintiff commencing an action after the In-Force Date must bring a claim for health care costs, a plaintiff who commenced an action before that date is under no such obligation.

The court noted that if a plaintiff in a preexisting action could amend to include a claim under the Act, that would leave the defendant’s exposure to a health care cost claim in the hands of a plaintiff who had no personal stake in that claim. The court continued:

Not only is this result anomalous but it seems to me that it may well be fraught with the potential for injustice. The cost of health care services is in many cases very substantial. … The threat of amending pleadings to bring such a claim may well pressure a defendant to enter into a settlement agreement in respect of amounts that that defendant may not be justly obligated to pay. At the very least, … [it would] result in some defendants being exposed to claims for health care services costs and other defendants not being exposed to those costs, dependant entirely on the whim of individual plaintiffs.

The court therefore held that the Act did not apply retroactively to preexisting actions and refused leave to amend.

Scope of the Act

The Gosselin decision restricts the application of the Act to claims brought by plaintiffs after the InForce Date and claims brought by the government within the two and a half year limitation period from the date of injury.

The following table summarizes the application of the Act following the Gosselin decision.

Please click here to view table