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Westbank First Nation's private hospital still on shaky legal ground

Robert Louie addresses media questions in the Westbank First Nation boardroom in July 2015.
September 03, 2015 - 8:00 PM

The first version of Westbank First Nation’s hospital project may be dead and buried leaving nothing but an $8 million debt for band members, but chief Robert Louie and his council are determined to continue pursuing the project.

So while band members consider that future, an obvious question is: Is this even legal in Canada?

Louie thinks so. His reasons for believing a for-profit, private hospital will proceed are based on “private discussions” with all levels of government, a legal opinion of unknown nature and origin, and Louie’s own belief it must be allowed eventually because governments can’t keep funding health care.

At a media conference in July, Louie made what he said would be his last public comments on the issue.

“The medical centre project is not dead,” he said. “We are currently undertaking a thorough review of the medical centre project with our membership…. I, personally, and I believe our council support and steadfastly stand behind a medically-themed development and this is based on expert research that has been done throughout Canada and also based on the demographics of the Okanagan Valley.”

The original proposal has long since collapsed. Westbank First Nation partners in the private hospital plan, Ad Vitam Healthcare, had $150 million in venture capital funding but it was later revoked for reasons unknown even to the band but some band members wondered if it was because the entire concept is on shaky legal ground. Ad Vitam appears to be entirely out of the picture now, unable to pay $8 million in debts tied Westbank First Nation lands. The band now has to pay that debt to get its lands back unencumbered.


When it was first proposed in 2011, proponents envisioned a full-fledged hospital providing an entire range of health care services from angioplasty to cataract surgery, spinal surgery to dermatology and colorectal surgery to sinus surgery. It also anticipated a specific arrangement for band members and other First Nations.

In an August 2011 slideshow to band members which preceded a successful referendum vote, (the same slideshow which promised “WFN will not have any financial obligations to this project” and “WFN will not be required to guarantee any monies borrowed for the purpose of funding this project”), the band and its partners touted a legal opinion that the project was “constitutional.”

Lyle Oberg, one of the partners, claimed he was also assured of its constitutionality in fall, 2010 by the then-minister of health for B.C. Oberg quotes Colin Hansen as saying: “I see no red flags that would stop this project from moving ahead.”

Times have perhaps changed, because we could find no authority in Canada which gave the project the thumbs up.


Louie declined questions about specifics of the "legal opinion" and whether the band anticipates launching a legal action based on its self government agreement or status as a First Nation. That would greatly complicate the question so we didn't include it in our queries. We asked Health Canada if the project as outlined would be constitutional. An interview request was declined but the department did send this formal written response. While not referencing the Westbank First Nation project, it seems clear — no, it's not constitutional.

“The Government of Canada is committed to a publicly funded, universally accessible health care system. The provincial and territorial governments have primary jurisdiction in the administration and delivery of health care services, and are responsible for ensuring that facilities and providers of insured health services operate in a manner that is consistent with the requirements of the Canada Health Act. 

"The Canada Health Act requires that insured hospital and physician services be covered by provincial and territorial health insurance plans. The act applies to all insured persons, including First Nations living on or off reserve.”

As Health Canada noted, provision of services has been delegated to the province, though B.C. Premier Christy Clark called it a federal issue.

“We haven’t really contemplated all of the requirements for the province,” she told earlier this year. "Because this would be a proposal by a First Nation on First Nation land, it requires approval principally from the federal government. So it’s not obvious what the province’s role would be in regulating that given that would be a private facility on First Nation land that would be subject, obviously, to the clinical standards and guidelines that apply to private clinics all across the province. But in terms of permitting and some of the bigger questions, that’s a federal issue because it’s on federally regulated land.”

Her health minister, Terry Lake, had a clearer answer as it pertains to B.C., but admitted “it’s kind of complicated.”

“The Canada Health Act and the Medicare Protection Act provincially do not, in our view, allow room for a private, for-profit facility unless they are catering to people that are non-British Columbian residents,” he said. “They're not beneficiaries under the medical services claim here in B.C. So in other words you have to be outside of the British Columbia system in order to access private or for-profit health care…. They would not be able to charge a B.C. resident who is enrolled in the medical services plan.... Beneficiaries are entitled to publicly paid health care services. So if you're enrolled in MSP, which presumably you are, you can't go to a hospital and get charged directly for the services they provide. So there's not a lot of room from our interpretation of the Canada Health Act.”


The response from Health Canada extends Lake's response about British Columbians to all Canadian citizens. A private for-profit hospital would be allowed if it only catered to non-Canadian residents for so-called health tourism, but it's unclear how it would fit in that market. Many other countries around the world cater to patients looking for cheaper health care and the August 2011 explanation doesn't anticipate cheaper costs. A Canadian destination for medical tourism has been piloted by one hospital in the country. While soliciting international patients may fatten the coffers a little, it has also been met with criticism for bumping Canadians from the queue.

Perhaps it was for these reasons — stated well after band members approved the hospital project in a referendum — that the Westbank First Nation vision for the hospital started to adapt and change. When asked if he anticipated a change in vision by dumping true medical care for elective surgeries like dozens of other clinics in the Okanagan alone, Louie said all options are being considered. 

But he held fast to his belief senior governments would eventualy allow a for-profit, private hospital and stated his desire private money should land here for the benefit of the entire Okanagan valley.

“We have some expert reports that have really analyzed the whole situation," Louie said. "That is confidential to WFN and will remain confidential. What I can say is there are certain medical issues that need to be addressed and there are too long of wait lists in many areas,” he said. “We believe there is still support and we have had discussions with both levels of government…. I am not privy to tell you the exact content of those discussion other than I firmly believe there is government support behind this project.

"It’s inevitable.”

To contact the reporter for this story, email John McDonald at or call 250-808-0143. To contact the editor, email or call 250-718-2724.

News from © InfoTel News Ltd, 2015
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