ARTA Health
Gary Sawatzky | Chief Operating Officer, ARTA
Why Doesn’t the ARTA Retiree Benefits
Plan Cover My Gym Membership?
The ARTA Health Benefits Committee often receives requests for
consideration for coverage of certain medical aids, devices, or services under
the ARTA Retiree Benefits Plan. Which is great — the committee always
appreciates hearing suggestions from ARTA members for coverage ideas to
best suit their needs and the benefit coverage needs of all ARTA members —
keep the requests coming! There are certain rules, however, that dictate what
may be allowed to be covered under a Private Health Services Plan (PHSP)
like ARTA’s.
To nobody’s surprise, it’s the federal government
that decides what medical aids, devices, and
services may be covered by a PHSP, via Canada’s
Income Tax Act. Incidentally, the government
also determines what constitutes a PHSP, but
that’s an article for another day.
Prior to 2015, the Canada Revenue Agency
(CRA) determined that all medical expenses
covered by a PHSP had to be considered medical
expenses eligible for the medical expense tax
credits (METC). The list of medical aids, devices,
and services eligible for the tax credit is included
in the Income Tax Act Section 118.2(2) and further
clarified in CRA Income Tax Folio S1-F1-C1.
The METC itself is a non-refundable tax credit
that may be used to reduce the tax liability of a
taxpayer who has significant medical expenses
that have not been reimbursed elsewhere (for
example, through a PHSP). A person can claim
their own medical expenses, or the expenses
incurred by their spouse or partner or by
dependent children. There are also provisions
to allow you to claim a portion of the expenses
you paid that were incurred by your over-age
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dependent children, grandchildren, parents,
grandparents, brothers, sisters, uncles, aunts,
nephews, or nieces, as long as they were residents
of Canada during the tax year.
Beginning January 1, 2015, CRA’s position
changed to allow PHSPs to cover other medical
expenses as long as “all or substantially all of the
premiums paid under the plan related to medical
expenses that are eligible for the medical
expense tax credit.” CRA further clarified that
“all or substantially all” generally means ninety
per cent or more. As such, ninety per
cent or more of the premiums
paid under a PHSP have
to be used to cover
medical expenses
that are eligible for
the METC.
In October 2018,
CRA issued further
guidance on benefits
that may be provided
through a PHSP. CRA
indicated that the ten