New contract awarded to administer the Public Service Health Care Plan

Date: December 1, 2021
To: Heads of Human Resources, Chiefs of Compensation, Outside Employers, managers and employees


The Government of Canada is pleased to announce that it has awarded an Administrative Services Only (ASO) contract to the Canada Life Assurance Company (Canada Life) for the administration of the Public Service Health Care Plan (PSHCP). The contract will take effect July 1, 2023, following a transition period.


The PSHCP is an optional health care plan for eligible federal public service employees and retirees, as well as their dependants and survivors. It is designed to supplement provincial and territorial health insurance plans.

The Treasury Board of Canada Secretariat (TBS) is the plan sponsor and has an obligation to competitively re-tender the PSHCP service contract. The new contract, the result of a Public Services and Procurement Canada procurement process that began in 2018, has a term of up to 12 years and will provide the following administrative services for the PSHCP:

  • Claims Processing and Claims Payment Services
  • Positive Enrolment and Member Management Services
  • Audit and Claim Verification Program
  • Reporting Services
  • Member Communications and Information Services
  • Provider Communications and Information Services 

Service improvements

The new ASO contract will meet TBS’s business needs as the plan sponsor in a cost-effective and flexible way. The contract will maintain, and in some areas surpass, existing PSHCP claims processing services. It will provide high-quality data for decision-making, robust auditing, advanced fraud detection, increased digitization and improved member communications and services. The new contract will also support the Government of Canada’s policy goals on green procurement, digitization, and diversity and inclusion, and it will also specifically create opportunities for Indigenous Canadians.

Impact on plan members

A new plan administrator will have no impact on the cost of the PSHCP for plan members or to the benefits available to them and their families. Contribution rates are approved annually by the President of the Treasury Board, and plan changes are negotiated at the PSHCP Partners Committee, a collaborative forum comprised of Bargaining Agent, Employer and Pensioner representatives. This procurement process is entirely separate and forms part of the life cycle of any public service benefit plan. The award of the new contract to Canada Life simply changes who administers the PSHCP and adjudicates claims, starting July 1, 2023.

Next steps

Transition working groups from the Government of Canada, the Federal PSHCP Administration Authority, Sun Life Financial and Canada Life will work together to provide PSHCP members with a seamless transition from the current ASO contract to the new one. The transition period to move to the new administrator, which will take place until June 30, 2023, is both a complex project and an opportunity to streamline PSHCP processes. The new contract will allow the plan to be more responsive to the changing administrative health care needs of plan members and innovations in the health care industry.

How to prepare for the new contract

PSHCP members will receive regular updates on the transition progress and be asked to take a few simple actions leading up to the move to the new administrator. The Government of Canada asks that plan members respond to these requests and keep their contact information current with Sun Life to help ensure that there is no interruption in PSHCP coverage when the new contract starts on July 1, 2023.

PSHCP members must continue to send all claims and requests to Sun Life until June 30, 2023.

For more information on the Public Service Health Care Plan, visit

For questions or concerns, contact the Employee Relations and Total Compensation Sector by email.

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