AHS review recommends up to $1.9B in annual cost-saving cuts
CALGARY -- A review of Alberta Health Services recommends cuts aimed at saving between $1.5 billion to $1.9 billion a year while improving the quality and sustainability of health services.
On Monday, Health Minister Tyler Shandro said the report contained 57 recommendations and 72 savings opportunities including reviewing management positions, performing more surgeries in private clinics and outsourcing services such as housekeeping and food.
"Every dollar we save will be put right back into the health system to deliver on our promise to improve access and make the system work better for patients," said Shandro ahead of Monday's announcement in Calgary. "It’s about freeing up administrative resources so we can spend more directly on Albertans’ health care."
The province is spending $20.6 billion on health this year, which is 40 per cent of the provincial operating budget.
The Alberta Health Services performance review : summary report review looked at AHS’s structure, programs, services and policies in comparison with other provinces’ and best practices while seeking ways to cut costs and improve performance.
The recommendations include expanding homecare, reconfiguring some rural hospitals and aligning beds with the needs of each community -- focus on getting patients the most appropriate care.
- Use evidence-based approaches to ensure optimal staffing levels and skill mix across AHS operations, including enabling staff to work to their full scope of practice
- Work with unions to adjust collective agreement provisions to ensure sustainability
- Review management positions based on peer organization benchmarks
- Address physician compensation in AHS to align with other provinces, including reviewing radiologist contracts and use of stipends.
- Ensure patients receive care in the most appropriate settings by
- Expanding community-based and home care programs
- Aligning beds with patient need across the province, including acute care, long term care and designated supportive living beds with need across the province
- Consider long-term care facility ownership and selling Capital Care and Carewest to independent providers, but only if there is an appropriate return and high quality care is maintained
- Reconfigure small and medium community hospitals and emergency departments to better align with patient needs and provide better quality, without closing any facilities
- Expand use of non-hospital surgical facilities
- Expand clinical appropriateness initiatives to reduce unnecessary tests to improve patient safety, experience and access across Alberta
- Maximize current outsourcing model across remaining laboratory services
- Rationalize existing EMS dispatch and air ambulance bases toward the end of the existing ten year contract.
- Reduce costs by outsourcing more nonclinical support services such as food services, housekeeping, protective services and remaining laundry
- Explore revenue generation opportunities through expansion of preferred accommodation, retail opportunities, corporate advertising and space rental for underutilized space.
The government will not be following through on two recommendations outlined in the review as the health minister says there will be no hospital closures and there are no plans to consolidate urban trauma centres.
In the spring of 2019, Alberta spent just over $2 million to hire Ernst & Young to do the first comprehensive review of AHS since the health agency was formed in 2009. The review considered input from staff including about 1,200 physicians, 27,000 front-line workers and 4,200 AHS leaders, and from the public including about 1000 emails and feedback from 75 engagement sessions.
Over the next 100 days AHS is expected to inform staff about how the new plan will roll out.
"We will continue to find efficiencies and increase outcomes for Albertans. This report is a tool that can help us do that," said David Weyant, board chair of Alberta Health Services.
"Implementing many of the opportunities will take time and resources -- including financial resources." Weyant added that the board has full confidence in the AHS team.
Susan Slade, vice-president of the Alberta Union of Provincial Employees calls the review the latest example of the "government's biased panels and reports."
"It has become abundantly clear to Albertans that this government made up its mind long ago that the solution to everything is to cut services or hand them over to their corporate pals," said Susan Slade in a statement. "The government spent $2 million dollars to hire a private contractor to look at AHS operations and set the parameters so the only possible outcome would be in line with the UCP’s ideological commitment to destroy or disband publicly delivered care."
AHS has about 102,000 direct employees and an annual budget of $15.4 billion.
The original version of this story indicated that the review conducted in 2019 was the first review of Alberta Health Services. In 2017, Alberta's Auditor-General released the 'Better Healthcare for Albertans' report