When the Canada Health Act came into effect on July 1, 1984, all provinces knew they had three years to negotiate an end to extra-billing and user fees if they wished to be reimbursed for accumulated funds being withheld at the federal level, as penalties for those practices, under the Act's dollar-for-dollar restriction. British Columbia and Quebec had already outlawed extra-billing and Nova Scotia quickly followed suit. In Saskatchewan, where Mode III or extra-billing had been allowed under the Saskatoon Agreement that ended the 1962 doctors’ strike, the medical association claimed that maintaining this right “is extremely important for the profession’s freedom . . . [because it] is the single factor that separates the medical profession from being legislated into a civil service, union-like position” (Health Insurance and Canadian Public Policy, p. 448). The provincial government, however, resolved the matter by creating a new medical compensation review committee that would make negotiating the fee schedule a joint profession–government activity; in return, the Saskatchewan Medical Association agreed to have extra-billing banned, although doctors could still opt out of the provincial plan.
In Manitoba, the government had assumed that extra-billing was a minor concern, but when the reporting provisions of the Canada Health Act were applied, it discovered that 95 per cent of opted-out doctors were extra-billing, some as much as 80 per cent above provincial fee levels. This hurt seniors in particular and led the Minister of Health, Larry Desjardins, to bring in legislation that provided for binding arbitration and ended extra-billing. Wisely, he negotiated with the Manitoba Medical Association in order to counter the animosity of the specialists in the Association of Independent Physicians. When the legislation went into effect on August 1, 1985, 86 per cent of the province’s doctors supported it, and the federal government paid Manitoba the $1.27 million that had accumulated as a result of extra-billing.