On-call agreement of doctor with facility represents a distinct supply of a right
To meet the requirement to have a medical practitioner on call, a facility will generally enter into an agreement with a medical practitioner. These agreements generally provide that the medical practitioner will be paid a set fee for remaining on call during a given period of time. The agreements also generally provide that the medical practitioner will be paid additional amounts for intervening in patient care if and when called upon to do so during their on-call period.
When such an agreement is entered into, the medical practitioner supplies the facility with the right to call upon him or her to render health care services to the facility’s patients during a given period of time. The CRA considers this to be a distinct supply of a right by the medical practitioner that allows the facility to meet an operational requirement. …
Supply is of IPP rather than health service
[T]he nature of the supply of the right to be called upon is not dependent upon, altered, or extinguished, by a future rendering of health care services by the medical practitioner to the facility’s patients. The supply of such a right does not qualify as an exempt health care service, or part of an exempt health care service, under section 5 of Part II of Schedule V, as the supply of a right is not exempt under that section.
Accordingly, the supply of on-call coverage to the facility, whether or not the medical practitioner is contacted, would be a taxable supply of intangible personal property subject to GST/HST....
