Thank you very much, Mr. Chair, and thank you, honourable members.
It's a great privilege to have the opportunity to appear before you today to speak about the constitutionality of Bill , which is a very important initiative. In my view, the doubts that have been expressed in some quarters about the constitutional validity of the bill are a mistake.
I believe it's a valid exercise of Parliament's power. In particular, the more controversial parts of the bill from a constitutional point of view—not from my perspective but from the perspective of some—sections 3 through 7, the part that's going to be a new free-standing genetic nondiscrimination act is a valid exercise of Parliament's power to enact laws in relation to criminal law because it consists of, in its dominant characteristic, putting in place prohibitions in sections 3 through 6, and a penalty provision in section 7 for the purpose of protecting the health of Canadians.
I'm going to say a few words about the scope of section 91(27), and a few words about the bill itself. I'd like to emphasize the importance of a constitutional doctrine in this context, which we refer to as the double aspect doctrine.
What we mean by that is that there are some subject matters, like genetic discrimination, that can be addressed by both levels of governments within their respective spheres of jurisdiction. This subject matter can be addressed by Parliament in part through it's criminal law power, and of course, it also falls within the jurisdiction of the provinces. I hope I can offer some clarity on that point as well.
First of all is the criminal law power, and you're going to hear from the other members of the panel about its scope. This is a very broad federal power that has been defined by the courts as allowing Parliament to enact laws that have, as their dominant characteristic, putting in place prohibitions coupled with penalties for a typically criminal public purpose, such as the protection of public peace, order, security, health, and morality.
I'm quoting the leading decision of the Supreme Court of Canada on the scope of the criminal law power, a decision known as the “margarine reference”, which was decided by the Supreme Court in 1949 and has been the leading case that has been followed by the courts ever since.
The court has repeatedly emphasized that the criminal law power is a very broad power. It has served over the years to uphold, of course, many provisions of the Criminal Code, but many provisions of other statutes as well.
In my testimony to the Senate committee earlier this year, and in the brief that I've prepared for this committee as well, I've listed some examples of federal statutes that have been upheld pursuant to the criminal law power. They include provisions of the Food and Drugs Act, the Tobacco Act, the Firearms Act, the Youth Criminal Justice Act, the Controlled Drugs and Substances Act, provisions of the Criminal Code that relate to the securities trade, the prohibited activities provisions of the Assisted Human Reproduction Act, and part V of the Canadian Environmental Protection Act, which deals with toxic substances. Those are just some examples from the case law.
It's also true that the provinces have jurisdiction in relation to property and civil rights pursuant to section 92(13) of the Constitution Act 1867. This too has been a provision that the courts have interpreted broadly, and it includes regulation over most aspects of the regulation of the insurance industry. It includes regulation of the labour relations of most employers because most employers fall within provincial jurisdiction.
It's also true that the provisions of the genetic non-discrimination act, in sections 2 through 7 of this bill, have a significant impact on activities that fall within provincial jurisdiction, such as the insurance industry and activities of provincially regulated employers. That, however, is true of most provisions of the Criminal Code, or at least many provisions of the Criminal Code; that is, they deal with matters like theft, which is also in relation to property which is a provincial area of jurisdiction.
There are significant portions of the Criminal Code that deal with the solemnization of marriage, the conjugal offences, and the unlawful solemnization of marriage. Again, this is a provincial subject matter, pursuant to section 92(12).
In other words, we can say that much of the Criminal Code deals with matters that are double aspect matters, meaning they can be regulated by the federal Parliament pursuant to its criminal law power with regard to particularly harmful activities, and can be regulated from a provincial point of view pursuant to jurisdiction over property and civil rights. Therefore, I don't think we need to dispute whether or not this is a law that will have important impacts on provincial areas of jurisdiction. It will, but that's not determinative of its constitutional validity.
To determine its constitutional validity we have to ask if its dominant characteristic is to put in place prohibitions coupled with penalties in order to combat harmful conduct or to combat a social evil, or should we be worried that this is a kind of surreptitious attempt for Parliament to regulate the insurance industry, or to regulate provincial employers? I don't believe there is any reason to conclude that is the case. If that were the case, we would say this is colourable legislation, that its form is disguising its true purpose, which is to regulate provincial matters as opposed to suppressing harmful conduct or to suppress a social evil that we think is damaging to Canadians' health.
That's the key question, not whether this is a law that has an impact on provincial areas of jurisdiction. Of course it does, but that's true of most of the Criminal Code, for example.
The question we have to focus on is the pith and substance or dominant characteristic of the provisions of the bill. Is the dominant characteristic putting in place prohibitions coupled with penalties to protect the health of Canadians, or is it the regulation of a subject matter that falls within provincial jurisdiction? To determine pith and substance, the courts will examine the purpose of legislation as well as its effects, the title of the legislation as set out in clause 1 of the bill, the “” is important.
Clauses 3, 4, and 5 put in place prohibitions on requiring individuals to undergo genetic testing, on requiring them to disclose the results of a genetic test, and on the use of genetic test results without written consent. The aim of these provisions is to promote health and personal security and to protect privacy by protecting individuals' control over the decision of whether to undergo testing and over the uses of genetic test results. These prohibitions apply to any person. They do not mention any particular industry or type of actor.
Clause 6 provides exemptions from the prohibitions for health care practitioners and researchers, and clause 7 puts in place serious penalties for the violation of the prohibitions in clauses 3 through 5. In my view, it is evident that the dominant characteristic of these provisions is to put in place prohibitions coupled with penalties aimed at protecting individuals from threats to health and personal security posed by the use of genetic information without their consent.
The pith and substance of these provisions fall squarely within the definition of criminal law followed by Canadian courts ever since the margarine reference. They do not resemble the detailed and extensive regulation of assisted reproduction services, for example, of the type that were declared invalid by the Supreme Court of Canada in the Assisted Human Reproduction Act reference, or the detailed regulation of the insurance industry that was declared invalid in a series of cases decided in the first half of the 20th century, where the federal Parliament was seeking to assert jurisdiction over the insurance industry more generally.
Rather, clauses 3 through 7 of Bill are very similar in their nature and objectives to the prohibited activities provisions, including the prohibitions on the use of reproductive material without consent that were upheld by the Supreme Court of Canada in the Assisted Human Reproduction Act reference.
I'll be happy to go into further detail about the case law, or other aspects of jurisdiction of Parliament over human rights laws generally, or over discrimination generally, and how federal jurisdiction interacts with provincial jurisdiction in discussion with members of the committee.
Thank you very much.
I am not going to say much that Bruce hasn't already said.
I want to start by saying that the great advantage of the criminal law is that it can apply right across the country. On the problem with leaving the provinces and territories to enact prohibitions on genetic discrimination on their own, I agree with Professor Ryder that they would certainly have the power to do that. I'm sure that no province wants to permit genetic discrimination.
However, each province has its own legislative priorities, and a prohibition of genetic discrimination may not make the cut. If we did leave this to the provinces, I think we could be absolutely certain that there would not be a nationwide rule. The beauty of exercising the criminal law power is that it does provide a nationwide rule.
If I could talk a little again about assisted human reproduction, I appeared in the Supreme Court case for the federal government, and I was extremely disappointed when the whole scheme was not upheld. They did uphold certain prohibitions, but they struck down the regulatory scheme that had been established, I thought, under the criminal law power. However, the majority of the court disagreed. It was interesting that the provinces said it was something that was within their bailiwick. The majority of the court—although it is a very confusing judgment and the judges were all over the place—essentially agreed.
Do we expect the provinces to step up and deal with assisted human reproduction? If we did, we would be very disappointed. The provinces thought that was too controversial, too complicated, and the result of the Supreme Court's decision is that apart from the bits that were upheld, assisted human reproduction remains unregulated in most of the country. I think that's a really unfortunate situation.
I'm simply arguing for the great advantage once the federal Parliament makes some choices of enacting it through the criminal law, and where it will have a national effect.
A valid criminal law involves three elements. Professor Ryder has talked about them. There has to be a prohibition, there has to be a penalty, and there has to be a typically criminal purpose.
Limiting myself to the proposed genetic non-discrimination act—that piece of the bill—there is a prohibition of genetic discrimination. There is a penalty for breach of the prohibition. The only conceivable purpose of that is to prohibit and prevent what Parliament would regard as the evil of genetic discrimination. I agree completely with Professor Ryder's conclusion that the proposed law would be a valid exercise of Parliament's criminal law power.
I should add that I've read the Torys' opinion, which you have, which says that it's really about insurance, employment, etc. I don't agree with that. It seems to me that the act says nothing about those topics. I gather the topic of insurance was explicitly in the bill at an earlier stage. Professor Thibault took the view that the bill was unconstitutional for that reason. That's been eliminated, so this is not a prohibition that just applies to.... It's not singling out the insurance industry. It's not singling out employers. It's a perfectly general application.
So I do not agree with the Torys opinion, which was rendered on behalf of the insurance industry, that it's in pith and substance a matter of property and civil rights—i.e., insurance. Torys also said, and I disagree with them here as well, that we know there's a prohibition and a penalty, but it lacks a typically criminal purpose. In my opinion, the prohibition and prevention of the evil of genetic discrimination would clearly be accepted by the courts as a criminal law purpose.
Mr. Chair, let me stop there and await your questions.
Thank you very much, Mr. Chair, for inviting me to be here today.
This is a topic that I have been thinking about for some time. Last night, I found in my archives a paper on genetic discrimination that I did in 1994 for a certain Professor Irwin Cotler. You will understand therefore that I am in agreement with the principle and objective of Bill . I do however have a number of reservations, specifically as regards the constitutionality of clauses 3, 4, 5, 6, and 7.
I also agree with the letter published by the Minister of Justice regarding the validity of clauses 8, 9, and 10. In my opinion, these clauses are valid and do not pose any constitutional problems.
There are issues relating to legislative policy that have to be considered since there will be an overlap in jurisdiction, namely in labour law and the jurisdiction that will be given to human rights tribunals. This will create a conflict. I will talk in particular about clauses 3, 4, 5, 6, and 7.
In examining the substance of a provision, we have to look at the title, to be sure, but we must also look at what is in it and what exactly it does. Clause 3 prohibits any person from requiring an individual to undergo a test. It is possible to undergo a test to obtain services. The bill does not prohibit it, but it does prohibit requiring someone to take a test as a condition of obtaining services.
Nor do these same provisions prohibit the use of genetic information obtained with written consent for purposes of clarity. Clauses 3, 4, 5, 6, and 7 of the bill do not prevent discrimination on the basis of genetic information. It does, however, prohibit this in the two other parts. Under labour law, a person cannot be punished or have a benefit withdrawn based on test results.
The Canadian Human Rights Act prohibits discrimination based on genetic characteristics, but not in the first part, which simply prohibits requiring someone to provide information for the purpose of obtaining a service or a contract. The real legal effect is to prohibit requiring someone to take a test, to allow information to be disclosed voluntarily, and to allow information to be used if it is provided voluntarily.
The conditions under which a contract is formed or those affecting what in civil law are called personality rights traditionally fall under provincial jurisdiction, as stipulated in section 92.13 of the Constitution Act, 1867. Moreover, section 3 of the Civil Code of Quebec provides as follows: “Every person is the holder of personality rights, such as the right to life, the right to the inviolability and integrity of his person, and the right to the respect of his name, reputation and privacy.” Section 3 is an integral part of the first book of the Civil Code of Quebec, entitled “Persons”. There is also a separate chapter on respect of privacy, starting at section 35.
I will read you a passage from a key decision that elucidates what criminal law is and what can be done under it. This passage is from the Attorney General for Ontario v. Reciprocal Insurers.
||In accordance with the principle inherent in these decisions their Lordships think it is no longer open to dispute that the Parliament of Canada cannot, by purporting to create penal sanctions under s. 91, head 27, appropriate to itself exclusively a field of jurisdiction in which, apart from such a procedure, it could exert no legal authority, and that if, when examined as a whole, legislation in form criminal is found, in aspects and for purposes exclusively within the Provincial sphere, to deal with matters committed to the Provinces, it cannot be upheld as valid. And indeed, to hold otherwise would be incompatible with an essential principle of the Confederation scheme....
In this case, it was argued that selling insurance without obtaining a federal license was a crime. The court ruled that it was not. Selling insurance falls under provincial jurisdiction. It is not possible, simply by creating a prohibition and a sanction, to cause the matter to fall under federal jurisdiction under criminal law. In the present case, we cannot consider that requiring someone to give genetic information in order to obtain a service automatically falls under criminal law simply because a sanction is added to the prohibition. As my colleagues have pointed out, we must determine whether this prohibition is criminal in nature.
Allow me to digress for a moment on this subject. If, despite the term used, the subject of the bill is not the transfer of genetic information but rather rights and freedoms and the right to equality, we must remember that these rights do not fall under the jurisdiction assigned to one legislature or another, but instead they fall under a jurisdiction that is ancillary to another. We must therefore stipulate what this other jurisdiction is.
Traditionally, this would be a jurisdiction associated with private law, civil law, and contracts law. That is why the provinces are responsible for the general rules applicable to the right to equality. I would point out in passing that, even though it prohibits a series of discriminatory actions, section 20.1 of the Quebec Charter of Rights and Freedoms provides that in such contracts or plans, that is, insurance contracts or pension plans, “[...] the use of health as a risk determination factor does not constitute discrimination within the meaning of section 10.”
Rightly or wrongly, a provision specifically provides that using health status to determine the extent of risk is not a discriminatory act. Professor Hogg told us earlier that, in his opinion, this is an issue that falls under criminal law. In his book, he states in fact that it may be possible to criminalize discrimination.
He said that under the criminal law power and in making that classification, the courts will look for the ingredients of criminal law—the prohibition, the penalty, and typically, criminal public purpose—and not primarily the law's impact on discrimination.
The criminal nature cannot be deduced simply from the fact of discrimination. Moreover, what constitutes criminal nature?
We have to fight against an evil. We saw the reference on firearms and we discussed that. We talked about the three criteria, which are prohibition, penalty and fighting against a criminal purpose. The courts have pointed out many times that this must not be interpreted too broadly so as not to deplete provincial jurisdiction.
In the Reference re Assisted Human Reproduction Act, the term “reprehensible conduct” is used. Although this decision is fairly complex since there was no consensus, there was agreement on the term “reprehensible conduct”. The term “undesirable conduct” is used often. It is difficult to talk about reprehensible or undesirable conduct in this instance when the Assisted Human Reproduction Act itself recognizes the possibility of providing information voluntarily. It is hard to say that disclosing genetic information is undesirable or reprehensible conduct in itself when section 7 of the act allows it.
I can answer other questions, but, before I conclude, I would stress that in this reference, in examining whether elements are criminal in nature, the decision refers to “conduct that is reprehensible or represents a serious risk to morality, safety or public health”. In this case, the rules on consent in civil law is emphasized. The Supreme Court ruled in this case that the provisions pertaining to information and patient consent are all unconstitutional.
The concern is that there could be a legislative gap. We must remember, however, that our laws prohibit discrimination on the basis of disability, which includes not only an actual disability, but also a potential or feared disability, and even the perception of such a disability. This is established in a Supreme Court decision.
Thank you very much.
Thank you, Mr. Chair, for inviting me to appear before the committee today with regard to Bill , which seeks to prohibit and prevent genetic discrimination.
The objective of the bill is in my opinion commendable and warrants consideration. As my colleagues have pointed out, however, we have to consider the legislative impact of this bill as regards the Constitution of Canada. I have examined the new version of Bill S-201 and consider it constitutionally valid.
As I stated when I appeared before the Standing Senate Committee on Human Rights on December 11, 2014, I do not see anything that prevents Parliament from amending the Canada Labour Code and the Canadian Human Rights Act—on the contrary, in fact—and adding provisions to prohibit genetic discrimination without encroaching unduly on provincial jurisdiction for insurance. That is what the new Bill S-201 does.
I also thought that there might be debate about the scope of Parliament's power with regard to criminal law. In my opinion, there are two other ways of justifying the constitutionality of Bill S-201. The first is based on the incidental effects doctrine and the second on the ancillary powers doctrine. Let me explain what these two doctrines entail.
Under the incidental effects doctrine, the constitutionality of a law can be justified based on its purely incidental effects on provincial jurisdiction. Here is what Chief Justice McLachlin said in the Lacombe decision:
|| The incidental effects rule, by contrast, applies when a provision, in pith and substance, lies within the competence of the enacting body but touches on a subject assigned to the other level of government. It holds that such a provision will not be invalid merely because it has an incidental effect on a legislative competence that falls beyond the jurisdiction of its enacting body.
Under the ancillary powers doctrine, on the other hand, a law can be justified that encroaches on the jurisdiction of the other order of government to the extent that the provisions in question are ancillary and necessary to implement the law effectively and adequately. This means that the law is entirely valid.
This is how Chief Justice McLachlin explains it, once again in Lacombe:
||The ancillary powers doctrine applies where, as here, a provision is, in pith and substance, outside the competence of its enacting body. The potentially invalid provision will be saved where it is an important part of a broader legislative scheme that is within the competence of the enacting body.
One could deduce from these explanations that the ancillary powers doctrine and the incidental effects doctrine of a law appear to contravene the exclusive areas of jurisdiction set out in sections 91 to 96 of the Constitution Act, 1867.
It should be noted that the Supreme Court is not in favour of a strict interpretation of this doctrine of exclusive areas of jurisdiction since this would run counter to the principle of cooperative federalism. In Bank of Montreal v. Marcotte, for instance, Justices Rothstein and Wagner state:
||A broad application of the doctrine is in tension with the modern cooperative approach to federalism which favours, where possible, the application of statutes enacted by both levels of government.
On these grounds and in view of the state of Canadian constitutional law, it appears to me that Bill S-201, as revised and amended, is constitutionally valid.
Thank you for your attention. I will be pleased to try to answer your questions.
As a point of clarification, I don't think the chief justice's opinion in the Assisted Human Reproduction Act reference is correctly described as a dissent on some aspects of the decision. There were three separate opinions. I think the most important conclusion the court reached in the case was upholding the prohibited activities provisions of the act, but striking down the regulatory provisions of the act, the licensing scheme, what the court referred to as the detailed or minute regulation of the delivery of assisted reproductive services.
That's the key distinction in the case. The court upheld the prohibited activities provisions. It struck down the detailed regulation through licensing scheme, and other measures.
I think it's important to refer to her opinion, as you have it. It is not a dissent in all aspects. Together with Justice Cromwell's decision, it made up the majority for upholding the prohibited activities sections.
I don't understand the objection, frankly, to sections 3 through 7 on the grounds that they're not seeking to promote public health, which is one of the legitimate purposes of the criminal law power. It seems clear that the ultimate objective is to encourage people to undergo genetic testing because it has great value from the point of view of their health and our health care system as a whole. It also seems clear that we're concerned they will be discouraged from doing so if they don't have control over when to undergo genetic testing and what happens with their results.
The arguments against it remind me very much of some of the arguments that were made by the tobacco industry in the RJR-MacDonald case. The Tobacco Act prohibits advertising and other marketing practices related to the sale of tobacco products. The argument was made, “That's not targeting a social evil. What's evil about advertising? It's a lawful product. We're just seeking to promote it, and therefore, it falls outside the criminal law power.”
What the court said was that it's legitimate for Parliament to consider the various ways of promoting public health, and that given the addictive nature of tobacco products, it's very difficult to target consumption itself, so it would instead prohibit advertising and other marketing practices in an effort to deter the consumption of tobacco in the interest of promoting health.
I think what's going on with sections 3 through 7 is something very similar. Regarding the practices that can deter people from undergoing genetic testing and benefiting from the amazing amount of information one can obtain through genetic testing, which is related to taking preventative measures regarding health care and other health benefits, we believe we have to deter those practices in order to promote public health, just as we had to prohibit tobacco advertising for similar reasons.
I think it's an interesting question. Professor Hogg has taken a position that the federal Parliament can pass laws prohibiting discrimination pursuant to the criminal law power. We haven't had a lot of opportunity to consider the limits of such a power, because Parliament has chosen not to address discrimination primarily through the vehicle of the criminal law power, and that's true at the provincial level as well, where most of our approach is remedial and focuses on civil penalties as opposed to offences.
Discrimination as a legal term, of course, covers a very broad array of conduct. Some of it is very serious in its impact on individuals and groups, and some can be relatively less serious. For example, in the context of employment discrimination, people can lose their jobs as a result of discrimination, a very serious consequence, or they may have to endure one single discriminatory comment at work that does create a negative environment and has impact, but is that a kind of evil that would amount to something that could be covered by the criminal law power? It's definitely arguable that this would be going too far.
I think it is very significant that the prohibitions set out in clauses 3 through 6 of the bill are very targeted. They don't deal with all aspects of discrimination. They're focused on giving individuals control over their genetic information, giving them control over the decision of whether or not to undergo genetic testing, and giving them confidence that, if they do decide to undergo genetic testing, they will be able to maintain control over the results of that test and it won't be able to be used by others to impose negative consequences on them.
I think those are very serious kinds of discrimination, which are being addressed by the bill, and certainly not the full array of potential discriminatory consequences that could be imposed on the basis of genetic characteristics.
Sorry, I wasn't sure I understood.
Jurisdiction over discrimination is, of course, divided between the federal Parliament and the provincial and territorial legislatures. As you know, pursuant to the Canadian Human Rights Act, federal jurisdiction applies only within certain areas, such as, for example, federally regulated workplaces. Provincial jurisdiction under human rights codes will apply to other workplaces.
On this issue, when we think of the amendments to the Canadian Human Rights Act, for example, they're not going to apply. A prohibition on genetic characteristics in the Canadian Human Rights Act is not going to apply to most employers in the country. The provinces would have to amend their human rights legislation to accomplish that objective, as Ontario is doing with Bill 30, which is currently before the Ontario legislature and is going to amend the Ontario human rights code to add a prohibition on discrimination on the basis of genetic characteristics. It has passed second reading and is now on its way to the justice committee at Queen's Park.
The criminal law power—and this comes back to what Professor Hogg was saying earlier—enables Parliament to pass a law that will apply in all spheres. Of course the advantage of that is that when we believe that something is seriously wrong and amounts to a social evil, then it's not enough to leave it to the human rights complaints process, which is episodic and may deal with a very small part of the issue, and may lead to remedies that are tailored primarily to the individual complainant. It could possibly have an impact in a more systemic sense, but it's not particularly reliable in that regard, whereas the criminal law, especially when you have prohibitions coupled with serious penalties, is, one would hope, going to have a more systemic impact on all service providers caught by the prohibitions, and all those engaging in contracts caught by the provisions.
So yes, there is an overlap with provincial areas of jurisdiction, but that's so common with federal criminal laws.
Thank you, and thank you for this opportunity.
The Canadian Institute of Actuaries is dedicated to serving the public interest through the provision of actuarial services and advice of the highest quality. The institute specifically holds the duty of the profession to the public above the needs of the profession and its members.
The CIA has applied actuaries' unique skill set to genetic testing and its potential impacts on the Canadian public. I stress that we are not here to speak on behalf of the insurance industry.
The first problem with the bill is that it facilitates anti-selection. There are many components to a robust insurance system and one of them is the ability of the insurer to evaluate an individual's risk based on many inputs, including a variety of medical tests, and placing those with similar risk profiles in a distinct pool. This is a process based on actuarial and medical science that can be best described as differentiation, a foundational insurance concept used for centuries. It insures that for fairness considerations people facing similar risks pay similar premiums. This bill would undermine this time-tested process and introduce the likelihood of pervasive anti-selection, which is the ability of one party to a contract to take advantage of information that is not available to the other party.
The second problem with the bill is that it is discriminatory. When purchasing insurance, Canadians facing a reduced life expectancy discovered through non-genetic medical means such as an EKG or an X-ray must disclose the information they have been asked, and may be declined for insurance. However, under this bill, those with similarly reduced life expectancy discovered through genetic tests may withhold the results and get the insurance they applied for. This distinction is not based on sound actuarial and medical principles. It is completely arbitrary and as such represents the worst form of discrimination.
Let me discuss briefly the experience of the Affordable Care Act in the United States, also known as the ACA or Obamacare, because it's very relevant to this bill. One of its key elements is that insurers are legally required to provide coverage to all applicants regardless of medical history. The premiums basically reflect the age of the insured and the experience within a region, but sex and pre-existing conditions are ignored. This is a textbook condition to encourage anti-selection, which led me and many actuaries and economists to predict the following: one, large spikes in premiums for many people; and two, many people refusing to participate in the ACA and instead paying the fine for doing so, and large losses for insurers. That is exactly what has happened.
Increases of as high at 65% have taken place. An insurance death spiral resulted as the people remaining in the ACA required so much medical care that many insurers lost money no matter how much they raised premiums. Eventually insurers had no choice but to pull out of the program. Aetna and UnitedHealth and many other insurers have done so after massive losses.
The ACA experience is very relevant because its key element is similar to the condition that Bill would create. In fact, under the bill, the ACA's key element could be rewritten as “insurers are legally required to provide coverage to all applicants regardless of the results of genetic tests, and must set premiums based on age, sex, and smoking status”, rather than “age, sex, smoking status, and relevant genetic information”.
As you can see, the two wordings are close, and it would be remarkable if the bill didn't have similar impacts on the people of Canada who buy individual life insurance. American lawmakers ignored expert advice with the negative results I just mentioned. We can only hope that the proper lesson has been learned so as to avoid a similar debacle in Canada.
Thank you very much, Mr. Chair.
You may not have intended it, but the anti-selection that Bill would allow confers a benefit on those who test positive for certain genes. They know that they will be able to buy insurance priced to cover a risk much lower than their own risk. Suppose Bill S-201 is enacted as is, and then you learn that, say, your son-in-law carries a gene for a serious, often fatal, heart condition. Wouldn't you recommend that he buy life insurance, and a lot of it? If you answered yes, you are agreeing that anti-selection is real and that the law confers a benefit on those who test positive.
How big will the impact be? I created a model on behalf of the Canadian Institute of Actuaries, and I wrote two papers on it just to answer that very question. My model suggests that premiums for life insurance are likely to go up by 30% for males and 50% for females because of the prohibition in Bill . That's a lot. That's what most of your constituents will be facing soon after the passing of Bill S-201. We believe that you didn't intend to do something that would result in a big jump in costs for your constituents. We don't think that it's in the public interest to do so.
If you're familiar with the paper written by Angus Macdonald, in 2011, the size of the impact may surprise you. I can explain why my numbers are appropriate for Canada, if you wish.
It's possible to amend the bill to avoid the unintended consequence of large increases in what Canadians will pay for insurance. Our proposed amendment is in our brief, and it's shown on the slides here. There's a table, as well, that gives the amounts that we're suggesting. The amendment sets a limit for the prohibition on requesting to see the results of a genetic test. Because the limit in our proposal is based on the average weekly earnings as published by StatsCan, it requires no recurring action from Parliament to keep it up to date. A company could use a genetic test if the amount is over the limit and if the mortality impact of the gene is found to be well supported by data. That's what's meant by “reasonable and bona fide grounds”. This chart shows the limits for the various types of insurance.
The amendment directly addresses two concerns. First, there is no restriction on buying insurance after a positive test up to the amount that the average Canadian is now buying. Second, by not applying the prohibition on larger amounts, we won't have the serious anti-selection that would result in large premiums for those who have not been tested or have tested negative.
By the way, even today, Canadians with a positive test can get a significant amount of life insurance. Group insurance is not restricted at all. Mortgage life insurance is not restricted, as opposed to what CMHC offers. There are insurance products sold with no medical questions at all; these aren't restricted. If an individual previously bought guaranteed insurability insurance, then more life insurance can be purchased with no medical evidence. Any insurance that's already owned cannot be terminated by the insurance company because of a positive test. So, fears about access to insurance are not well founded.
Note that the amendment that we will propose will not benefit the insurance companies. The companies are able to adjust their premium rates to protect their own profits.
I don't expect that their profits will, in the long run, be materially different if Bill is defeated, if it passes as is, or if it's amended as we propose. It's the public that will be hurt, but only if Bill S-201 passes as is. Our proposed amendment would protect.
Thank you, Mr. Chair.
Thank you very much, Mr. Chair, and thanks to the committee for providing me the opportunity to speak to you.
I would like over the next few minutes to try to bring to life some of the discussions you have been having over the last few weeks, and to provide you with evidence that genetic discrimination is real. It's a frequent problem in this country that's affecting thousands and thousands of individuals.
I'm here today speaking not only on behalf of the 197 colleagues around the country who have sent a letter to all of you, but also on behalf of health care providers all over Canada, and maybe most importantly, I'm here to speak on behalf of every individual in Canada who is potentially at risk of being faced with genetic discrimination at some time in their lives.
I will provide you with three examples that address the issue that we are facing in the health care community.
I will give you an example of how genetic discrimination interferes with our ability to provide high-quality, safe, and best-standard clinical care to our patients, something that, in part, can be paralyzing for us as health care providers.
I will provide you with an example of how fear of genetic discrimination can interfere with our ability to perform the kind of research we need to actually move forward our standard of clinical care and continue to improve it, and at the same time think about the health care cost and try to keep it down.
Last but not least I will give you an example of the preventative aspect that the fear of genetic discrimination has, where without genetic testing, individuals cannot act upon certain knowledge and put measures into place that will provide protection or help to avoid a life-limiting or a life-threatening disorder.
Let me start with the first example—and it's sad for me to say that I've been in Canada for four and a half years now, and there are too many examples that I could choose from since I've moved here. I chose the example of a young girl who came to my clinic because she was thought to have a connective tissue disorder. The issue with that disorder was that she would be put at risk of her big blood vessel, coming out of her heart, the aorta, being torn, which would be a life-threatening problem.
Once I examined her, I discussed with the family the offer of genetic testing to find out whether she has a more severe or a milder form of this disorder. When I went through the consent process and we had to discuss the issue of genetic discrimination, both parents were very agitated about it. The mother was looking for a new job, and she said she was afraid that this might interfere with her ability to get that job. The parents did not have life insurance, and they said they did not want to go forward with the genetic tests. As a result, this child has to come to the hospital every three months to get an ultrasound of her heart, and is living with the fear of having the more severe form of the disease, but taking this fear over the fear of genetic discrimination.
I would like each one of you to put yourself for one minute into my shoes, knowing that I am not able to provide the right standard, best practice of care because the family declined to go forward with genetic testing. It has been paralyzing at times to me and to other health care providers to simply not do the job I learned and was trained how to do.
The second example is of a research study in which we were trying to answer the question of whether whole genome sequencing—the sequencing of your entire genome—would be a much better test to diagnose a medical condition, and also a much cheaper test for the health care system.
We approached about 200 families. I would like you to think for a moment about families who have had children for many years, most of them with very severe medical conditions, who are trying to look for an answer as to why this is happening to their child. When we offered them the chance to participate in the study, telling them, “There's a really high likelihood that we'll find an answer for you”, they were elated, excited, as you can imagine. Yet again, when it came to the consent process, over 35% of families elected not to participate because of a fear of genetic discrimination.
What that shows you is that, despite being on a search, a journey, to try to find an answer for “what is wrong with my child?”, parents elected not to go after that because of the fear that they would have issues with genetic discrimination. At the same time, it corroborated, somehow, that our study made it much more difficult to do this kind of research to actually prove that this is a better test, it's a cheaper test, and that's the test that we should offer the Canadian public if you are in a situation like this.
The last example I'm going to give you is about a young adult woman who has a family history of colon cancer. Her mom had colon cancer. She elected to do genetic testing, in order to find out whether she has a genetic form that predisposes her to this cancer.
When she went through the consent process, I don't want to repeat myself too much, again she was faced with the fact, “I can't get life insurance. What I will do is I will get yearly colonoscopies to screen myself so, in case something happens, I know that I can protect myself.”
The issue is, if you are young, you don't get yearly colonoscopies covered by OHIP if you don't have genetic evidence in order to actually be allowed to get that covered. In the end, she decided her health was more important than insurance issues. She did the genetic tests and was found positive and is in now in a situation to do yearly colonoscopies and is actually going to be able to prevent any kind of medical complication from happening.
While I'm not here to talk about industry or insurance issues, I would like everyone to consider that the preventative aspect and the preventative power of genetic knowledge gives many individuals the opportunity to take action to actually stay alive, healthy, as long as possible, and as a bi-effect, obviously, pay your insurance premium.
I hope I was able to bring to light some of the issues and, based on this, I'm going to go out on a limb and urge all of you to accept Bill without any amendments, in full, as it is, so every Canadian can have a better life, free of genetic discrimination for everyone.
I'm Stephen Frank, senior vice-president of policy for the Canadian Life and Health Insurance Association. I am accompanied by my colleague, Frank Zinatelli, who is vice-president and general counsel at the CLHIA.
The CLHIA represents life and health insurance companies that account for 99% of the life and health insurance in force across Canada. The industry protects 28 million Canadians and makes benefit payments of $84 billion a year.
We appreciate this opportunity to appear before the committee as it reviews Bill . As drafted, we do not support Bill S-201. Our central issue is that, over time, it would likely result in an increase in the number of Canadians who do not have insurance. In addition, we do not believe that clauses 1 to 7 of the bill are constitutional.
Let me elaborate on these issues and also highlight what the industry is doing to address concerns over the protection of individuals' genetic information, while ensuring that insurance remains affordable for Canadians.
Insurance is a good faith agreement. At the time of application, parties disclose any information that may be material to the contract so that the contract can be entered into on an equal information basis. This ensures that the applicant knows what benefits are being provided and that the insurer can properly understand the risk in order to make an informed decision about whether to provide life insurance to that individual and at what price.
This principle is protected in insurance legislation in every province and territory. Under this principle, and with the express consent of the applicant, insurers use family history, lifestyle and medical information to set prices that fairly reflect the level of risk of insurance applicants. Using genetic test results already in the hands of the applicant is a logical application of this principle. This helps ensure that the costs of insurance reflect each individual's risk and that some individuals are not inappropriately paying for or subsidizing the cost of insurance for others.
Experience tells us that if an individual gets a genetic test result that confirms that they're more likely to develop an illness or other condition earlier in life than the general public, they will seek out insurance and they will seek out more of it than they otherwise would have.
Ultimately, this will result in higher premiums for other consumers as insurers will need to increase premiums for everyone to cover these unanticipated higher costs. As you've heard already, the Canadian Institute of Actuaries has concluded that not allowing insurers to have such relevant information would over time lead to increases in term life insurance of 30% for men and 50% for women.
We know that Canadians are price-sensitive. As prices rise, many thousands of them will likely decide not to purchase insurance due to cost considerations. Therefore, a likely result of any prohibition on insurers having equal information when assessing an application for insurance, is that fewer Canadians will have protection from unfortunate events than otherwise would have.
We also do not believe that section 1 through 7 of the bill fall within the constitutional jurisdiction of Parliament. The predominant effect of those sections would be to regulate the provisions of goods and services and the terms of contracts including in the insurance industry. Sections 1 through 7 of the bill, therefore, fall clearly under the property and civil rights head of power, for which the provinces have exclusive constitutional authority.
There have been previous testimony on this bill that it could be considered constitutional based on the federal criminal power. The federal Parliament has broad and plenary power in relation to criminal matters. However, the federal Parliament cannot legislate within an area of exclusive provincial jurisdiction, simply by casting the legislation as criminal. The Supreme Court of Canada has indicated that Parliament's ability to pass criminal law that addresses health is limited. Genetic testing information does not fall under this category.
As well, please note that sections 1 through 7 of Bill target a specific category in specific contexts, including insurance and employment, and do not have a criminal law purpose. They're not aimed at prohibiting genetic discrimination generally and cannot be supported under the federal criminal law power.
Our comments are supported by the views of the Torys law firm, in an opinion that we have obtained. We have provided copies of the legal opinion to the clerk to distribute to members of this committee.
As an industry, we understand that genetic testing information is sensitive medical information. This is why the industry already has in place an Industry Code, in which all life and health insurers commit to a variety of obligations, including that no Canadian will be asked to take a genetic test as a condition of obtaining insurance.
Beyond this, however, we are committed to proactively finding a solution that balances the concerns of Canadians regarding the use of genetic testing results with the need for fair and reasonably priced insurance.
As such we've been actively working on this for many months and recently initiated discussions with the provinces on an approach where insurers in Canada would commit to not asking for or using any genetic test results for applications for life insurance policies up to $250,000. At this level more than 85% of applications for life insurance would not require any disclosure of genetic test results, and therefore, will address the concerns around this issue for the large majority of Canadians.
This approach would also keep the cost of life insurance affordable for the average middle-class family. We hope to be in a position to make an announcement with respect to this initiative shortly.
In conclusion, Bill would undermine the critical principle of equal information and would likely result in an increase in the number of Canadians who do not have insurance over time. In addition, we do not believe that the sections of the bill dealing with insurance are within federal powers. However, we understand that genetic information is sensitive to Canadians. We've started discussions with the provinces about finding a balanced solution that will appropriately protect Canadians' genetic information while also maintaining fair and reasonably priced insurance.
We appreciate this opportunity to participate in the committee's review. We would be pleased to answer any questions you may have.