Chan's Personal Blog

A few years ago, after a certain birthday, I was hit by an unexpected bill known as the medical services plan (MSP). This was a bill for healthcare issurance because I couldn't fall under my family's plan due to my age. So, every quarter since, I dump money into healthcare insurance for services that I don't use. On top of that, as a student at UVic, I'm forced to buy extended healthcare coverage, which I don't use at all either.

In either case, a few days ago, my brother got hit by this unexpected bill which constitutes a rite of passage. When you get hit by one of those bills, it means you're now a man .

He showed me the bill and asked me what it was. I explained it to him, but a strange form was attached to his bill. It was a premium subsidy form.

If an individual applies to this program, the BC Government's MSP Premium Assistance Program, it allows qualified individuals to reduce their healthcare premiums!

For some reason, when I got MY first MSP bill, they never gave me such a form!!! So, I never knew anything about this program! I did some digging on the government website, and I've realized that I've been paying too much for healthcare all this time. Argh!

So here's the info I got off the government's MSP site:

Who Qualifies?

Assistance with the payment of premiums is available to Canadian citizens or holders of permanent resident status (landed immigrants) who have held that status and been resident in Canada for the past 12 consecutive months.

Regular premium assistance offers subsidies ranging from 20 to 100 per cent, based on an individual's net income (or a couple's combined net income) for the two preceding tax years, less deductions for age, family size and disability. If the resulting amount referred to as "adjusted net income"* is $24,000 or below, a subsidy is available.

*Net income is basically how much money you made after taxes and various deductions made on your tax forms such as donations, RRSP contributions, tuition tax credits, etc.

How Much Is The Subsidy?

Before July 1, 2005, the adjusted net income thresholds are:
$16,000 - 100 percent subsidy
$18,000 - 80 percent subsidy
$20,000 - 60 percent subsidy
$22,000 - 40 percent subsidy
$24,000 - 20 percent subsidy

After July 1, 2005, the adjusted net income thresholds will be:
$20,000 - 100 percent subsidy
$22,000 - 80 percent subsidy
$24,000 - 60 percent subsidy
$26,000 - 40 percent subsidy
$28,000 - 20 percent subsidy

Calculating The Savings

Say you pay $54.00 a month for healthcare, and your net income was $20,000. Under the old rules, you would save $32.40 a month, and your payment would be $21.60 a month.

Under the new rules (after July 1, 2005), you would save $54.00, and pay $0.00 a month for healthcare.

Pretty sweet huh?

How Do I Sign Up?


Conclusions

With these subsidies, I'm a little less bitter about paying for healthcare. My payments used to be SO much less when I was under my family's plan, but this will have to do. Anyways, this information should be helpful for anyone that made less than $24,000 (net income) last year. If you're a post-secondary student, you would probably fall under this category, unless you made a ton of cash.

I sure wish I knew about this earlier. The government should automatically send the above form to anyone that has low-income. However, I do applaud the BC Liberal government increasing the subsidy plan's income limit. We'll see if I get this subsidy. It will definitely help reduce my monthly cash burn rate, and the money can be diverted to more important things.

Anyways, hopefully this info is helpful to someone.