There are two things they are charging you: a change fee (penalty for making a change), and the difference in fare from you booked to what’s currently available.
It it seems they are giving you some consideration by waving the change fee. One way a premium economy fares for YYZ-YVR on 31/01 are showing as $1500 (1274 base fare plus taxes). Most cheaper fares for PY on the route are available at 30, 21, and 14 days out, so assuming you booked much earlier, the fare difference you are being quoted is in line with that. By waving the change fee you are paying what you would be paying for booking a last minute ticket (in the PY cabin)
You could downgrade to a Flex fare in Y and probably only pay a minimal difference (if any).
if you have travel insurance you could try to see if this is covered, although since you are not the one who is having surgery, I think this is probably unlikely.
Have there been any schedule changes since booked? If so you might be able to use that to get a change or refund (and then buy a different flight).
Beaides all that, I honestly wouldn’t expect AC or any airline to make exceptions for things like this as it’s really not their fault, and they do offer flexible tickets for sale. It never hurts to try though.
i hope your dad makes a speedy recovery.