CRA states that it will not accept a medical expense that has not been rejected by the insurance company

S. 118.2(3)(b) indicates that a medical expense cannot be claimed if it is reimbursable under an insurance plan, even if in fact no reimbursement was claimed. CRA considers that "one is to assume that the expenses would need to be submitted to the insurance company before the amount can be considered by the [CRA]."

This accords with the principle that statutory provisions should be applied to maximize CRA’s convenience: this way, CRA does not need to review the insurance plan to see what is covered! (Another example of this principle in operation was pointed out to me by David Sherman (as also reflected in his notes on s. 127.531 in the PITA): CRA did not want to change their computer system to accommodate different charitable/medical claims for AMT and regular tax purposes, so they forced him to win on this point in the Tax Court - and then asked Finance for an amendment.)

Neal Armstrong. Summary of May 2013 ICAA Roundtable, Q. 18 (reported in April 2014 Member Advisory) under s. 118.2(3)(b).