Canada's health-care system appears well shielded from punitive action under free-trade deals, as long as the mix of public and private care is maintained.
But there is a stern warning to governments in health-care commissioner Roy Romanow's report, released last week: Haggle aggressively on future trade treaties to keep universal, publicly financed medicare safe.
Mr. Romanow says that Ottawa, the provinces and territories must tell trading partners that health care "will continue to be designed, financed and organized in a way that reflects Canadians' values.
"It does not mean that Canada is unwilling to participate in international trading regimes, but that social policy such as health care is, in effect, 'off limits,' " his report adds.
As Mr. Romanow gathered opinions during his inquiry, a fear most often voiced is that deals such as the North American free-trade agreement have narrowed the range of options for health-care reform.
NAFTA, made up of Canada, the United States and Mexico, allows foreign investors to claim damages from a member country if they can show that new laws or regulations reduce the value of their investments or give favourable treatment to local firms.
For example, if Ottawa were to decree that only provincial health plans could provide insurance for home care or pharmacare, a foreign company that offers such coverage could claim compensation for lost profits.
Also, any decision to allow expansion of profit-driven, user-pay medicine might be irrevocable under NAFTA's rules -- even if a future government were to judge the move a failure and want to reverse it.
But experts said that neither possibility is likely if governments follow Mr. Romanow's recommendations, which would largely maintain the division of labour between public and private sectors.
"Shutting the door on a parallel private system greatly reduces the risk of challenges," said Scott Sinclair, co-author of a report on health care and trade prepared by the Canadian Centre for Policy Alternatives for the Romanow commission.
Major recommendations by Mr. Romanow include increasing the amount of coverage under public medicare for prescription drugs and home care.
In his report, he calls for a federal fund to pay half the cost of so-called catastrophic prescription-drug expenses, now borne entirely by provincial and territorial plans.
The fund would have no impact on private drug plans, such as those widely included in employee benefit packages.
The report calls for some types of home care to be declared medically necessary, and therefore required coverage by provincial health plans. This, too, would have little impact on private insurers, whose coverage of home care is limited.
Gery Barry, president of Markham, Ont.-based Liberty Health, a Canadian unit of Liberty Mutual Insurance Co. of Boston, said NAFTA-related conflict over drug or home-care coverage is unlikely.
There is little chance of a turf war over home-care coverage because neither public nor private plans cover all home-care needs, Mr. Barry said. "We're both expanding simultaneously, and we'll still be working hard to have everyone covered that needs to be covered."
As for drug plans, Mr. Barry said governments hard pressed for funds would be unlikely to want to provide coverage now offered by private insurers.
"I don't see that as being an economic reality," he said. "I've spent very little time looking into it."
Liberty Health and Maritime Life Assurance Co., a subsidiary of John Hancock Financial Services Inc. of Boston, are the only U.S.-owned firms offering health insurance in Canada. Mr. Barry estimated their combined market share at less than 10 per cent.
Tribunals set up under NAFTA have awarded compensation from all of its member countries to firms that claimed their investments had been damaged by government action.
But lawsuits are expensive to pursue and the chances of success hard to gauge, since the tribunals act independently and their interpretations are not binding.
Challenges are unlikely unless huge profits are at stake, said Toronto trade lawyer Jon Johnson, who wrote a paper for the Romanow commission on trade deals and medicare.
"For an investor to make a claim, it's got to be really worthwhile because pursuing NAFTA claims is a real pain," he said.
Despite the Romanow recommendations, some provincial governments and critics are pushing for an expanded role for profit-driven health-care.
If they prevail, the risk of future NAFTA-related problems will increase, Mr. Sinclair said. "Acknowledging the risk of trade-treaty challenges should be part of the debate."
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