Alberta will require employers to cover health benefits for workers over 65, raising hiring concerns

Employers in Alberta will no longer be allowed to drop health benefits for workers once they turn 65 — a legislative change taking effect this fall that is already raising concerns among business owners about hiring older workers.

Under current rules, employers can terminate group benefits for employees aged 65 and older, shifting those workers onto the province's health-care plan. The Health Statutes Amendment Act changes that: employers must now maintain coverage for all workers, regardless of age, and pay for those benefits themselves.

The province says the move protects workers' access to existing workplace coverage. "Government-sponsored plans are meant to act as a safety net when no other coverage is available, not as the first payer when employer-sponsored or private coverage already exists," Alberta's Ministry of Hospital and Surgical Health Services said in a statement.

But business owners and economists see a different picture. Peter Hurd-Watler, owner of a Calgary startup that helps small businesses grow, said health insurance wasn't previously a hiring consideration "because it was provided for by the government." Now, he said, "we would have to seriously consider that, and that would be a new variable in our hiring decisions."

Erin Strumpf, an economics professor at McGill University, said the cost shift will likely force difficult choices. "Employers are going to be looking at the possibility of premium costs going up over time," she said. "Employers have to find that money somewhere or they start trimming back a little bit the generosity of their insurance coverage."

Statistics Canada data shows Alberta's labour participation rate for people 65 and older has climbed from 17 to 18 per cent between 2021 and 2025 — higher than the national average of 14.2 to 15.2 per cent. The legislative change comes as more Canadians are working past traditional retirement age.