That would likely lead to a reference to at least a couple of the respective provincial courts of appeal (you can bet that Quebec would 100% be one of them), and then afterwards almost certainly resulting in an appeal to the SCC. Why? Because even if the provinces like the effects of the reform in some way, they will each have individual wants and will not take kindly to the feds trying to coerce them with money to that extent. Further, this would be viewed as an encroachment by the provinces, and they would feel the need to defend their powers to prevent encroachment by the federal government on other issue afterwards.
Provinces could argue that 1. the legislation is ultra vires because cutting funding would infringe on the power of the provinces to effectively regulate health care per s.92 of the Constitution Act, 1867 and 2. federal funding of health care has been constitutionalized as an unwritten principle (possibly under the recognized principles of 1. the rule of law, or 2. federalism).
How would the Court decide? Your guess is as good as mine as the Court has been very hard to pin down in terms of how they'll interpret the both the federalism aspect and the unwritten principles argument. Either way, this would all be extremely murky constitutional territory that the federal government would likely rather avoid (unless Trudeau really is his father's son in this sense and is willing to go to battle with the provinces. I find this unlikely just because of how much sheer political capital that required last time around). I guess the point it that the provinces are not going to lie down and take the federal government trying to impose anything on them, which precludes any workable universal scheme.
