Who Benefits? ACITIZEN'S GUIDE TO ALBERTA HEALTH CARE R EFORM - Doreen Barrie Department Of Political Science University Of Calgary - Eyes Forward
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Who Benefits?
A CITIZEN ’ S G UIDE TO A LBERTA H EALTH C ARE
R EFORM
Doreen Barrie
Department Of Political Science
University Of CalgaryPREFACE
Sixteen years ago when health care was on everyone’s mind prior to a federal election,
I wrote a Citizen’s Guide to inform Canadians about this highly cherished policy. Now,
in 2021, we are in the middle of a pandemic which is stretching the system to its limits.
Despite this, the Alberta government has legislated changes to health care in the
province which have the potential to transform it drastically.
My goal is to provide an analysis of where this might take us so Albertans can assess
these reforms and decide if they support them. I have had input from some members of
the medical profession, but this is my interpretation of what may lie ahead; others might
not agree with me. However, if my modest contribution sets off a debate about health
care in this province and the country, I would be pleased to have triggered it. It is my
sincere belief that as stakeholders in a program we pay for, it is essential we inform
ourselves about how it works and participate in a discussion about how it might be
improved.
I have tried to write this Guide in an accessible style, keeping it brief and keeping
references to a minimum. Those I have cited are the tip of the iceberg, representing a
large body of work on the subject.
Doreen Barrie, Ph.D.
Calgary, Alberta
February, 2021
4INTRODUCTION
Professor Ted Marmor at Yale University has referred to Canadian medicare as a
public policy miracle1
Canadians would be horrified if people were denied medical care because they
could not pay for it. Such a reaction is anchored in values like social solidarity and
equality that sustain our highly cherished health care system. Albertans are no less
supportive of this public policy and are anxious about the impact of recent provincial
government reforms. Health care in Canada is not a single, uniform system. It
consists of 10 provincial systems plus those in the Territories, connected to each
other through the Canada Health Act. (See Appendix A).
Health care constitutes a major share of provincial budgets - approximately 40% in
Alberta, so it is a natural target when governments are seeking to reduce
expenditures. As former Premier Klein used to point out, you “hunt where the ducks
are”. It is also reasonable to expect periodic reform in a system so large and vital, to
ensure it remains viable and responds to changing needs.
The Alberta (and Canadian) health system is not perfect, but it faces unique
challenges not encountered in other countries. Canada is an immense, cold and
sparsely populated country with challenging topography in many areas. This makes
it more expensive to deliver services than in more temperate, compact countries.
Hence, cross-national comparisons of health care should be approached with
caution as we cannot assume equivalence or replicate programs that are embedded
in a particular historical and social context. (See Appendix B). Nevertheless,
comparisons are made among industrialized countries, and Canada does not rank
high, in part, because dental care, eye-glasses and drugs are not covered. However,
when quality of care is the focus, Canada is near the top. The quality of care in
Alberta too, is very good but access across the country, continues to be a problem
that needs to be addressed.
Bill 30 is the primary vehicle of health care reform, but it is not the only one. The
Kenney government is also making changes recommended by the Blue Ribbon
Panel on Alberta’s Finances (the MacKinnon Report) and the Alberta Health
Services Performance Review conducted by Ernst & Young.
Bill 30
The Alberta government has passed an omnibus bill, Bill 30, which amends 9 pieces
of legislation. The Health Statutes Amendments Act provides it with the tools to
transform health care in the province and perhaps across the country. The Act has
the potential to upend the system, possibly splintering the medical profession and its
1
Quoted in Hutchinson, 2013.
5professional bodies. It seems to echo the Silicon Valley mantra: “Move fast and
break things.”
The legislation is wide-ranging, but in my opinion, the most consequential provisions
relate to:
• The drive towards privatization and corporatization
• Possible fragmenting of the medical profession and a weakening of the
relationship between the Alberta Medical Association (AMA) and its members
Although Bill 30 makes no reference to tele-medicine, this will be dealt with because
the pandemic has accelerated the adoption of novel means to access health care.
These developments deserve attention because they can usher in changes to the
physician/patient relationship.
Privatization/Corporatization
Private delivery of surgical services is not new. Alberta Health Services (AHS)
currently contracts with 43 non-hospital surgical facilities to perform cataract surgery,
plastic surgery, ear, nose and throat surgery and other routine procedures. Patients
are not charged although they are often offered enhanced services (up-selling) for
which they do have to pay.
What is new is that the government is proposing to double the percentage of
surgeries delivered in private for-profit facilities (from 15% to 30%) and allowing
publicly insured and uninsured procedures e.g. cosmetic surgery, to take place in
the same facility. This move will facilitate upselling services to patients in surgical
clinics (Graff-McCrae, 2020).
The rationale for increasing contracting out is to reduce wait times, but as the pool of
surgeons and anesthetists will not expand, wait times are not likely to come down.
We need only look at cataract surgery to test the veracity of such claims: A
comparison of wait times for cataract surgery in Calgary (where 96% are contracted
out) and Edmonton (where the figure is 18%) found that Calgarians wait six weeks
longer than Edmontonians (McIntosh, 2020).
An issue that is less well-known, is that such surgical facilities specialize narrowly on
easy, routine procedures on patients with less complex problems. If something goes
wrong, they do not have the capacity to cope with emergencies and have to send
the patient to a public hospital.
The argument that more contracting-out will bring costs down is similarly dubious as
there is a wealth of evidence that proves that for-profit delivery is generally more
expensive. There is also ample evidence that for-profit medicine is not only more
6costly, but also less effective and less efficient (Giles et al. 2019; Clements &
Gibson, 2012; Barrie, 2004).
A comparison of the cost of hip, knee/shoulder replacements plus foot and ankle
procedures in AHS facilities and in the for-profit Calgary Health Resources Centre
(HRC), found that they were higher in the latter. The difference was $1800+ for
foot/ankle procedures and $400-$500 more for other procedures. The Alberta
government’s position was that the additional costs were offset by the benefits of
reducing the waiting lists. The clinic went bankrupt in 2010, costing taxpayers
millions of dollars.2 The HRC case study is consistent with international studies
which conclude that for-profit incursions into health care “are risky, costly and lack
the accountability Canadians expect, demand and deserve” (Clements & Gibson,
2012).
Proponents of for-profit delivery have not provided any data to support their
argument that they can compete with the not-for-profit sector. It is self-evident that
for-profit medicine would be more expensive because providers pay more for
borrowing, spend money on marketing and they also pay income and corporate
taxes. In addition, they expect to profit from their investment.
Fragmentation and its Consequences
A major thrust of Bill 30 is to fragment the system, weakening the bargaining power
of the Alberta Medical Association (AMA), politicizing functions of health professional
organizations like the College of Physicians & Surgeons of Alberta (CPSA) and
Health Quality Council of Alberta (HQCA). In addition, introducing multiple actors
into the system, it will make it much more complex and costly to administer.
Increased administrative costs are discussed below.
Bill 30 was passed against the backdrop of ongoing conflict between the Minister of
Health and the AMA, which resulted in the 2019 termination of the agreement with
the Association. Minister Shandro appears determined to enfeeble the organization,
by exploiting natural divisions like those between rural and urban doctors as well as
between specialists and non-specialists.
The HQCA used to have an arms-length relationship with the government. However,
it will now report directly to the Health Minister thereby undermining its political
autonomy and changing the dynamic in the relationship. The public cannot expect
reporting that is free of political influence.
Public participation will be increased to 50% in the CPSA. The functions of this body
include registering physicians, accrediting physicians and health facilities and
monitoring facilities of private providers. These additional public members will have
a significant impact on the College’s decisions especially with regards to
accreditation of physicians and approval of new surgical facilities. It would be
2
AHS purchased HRC’s debt and security (Clements & Gibson, 2012).
7reasonable to ask what impact these new actors will have on a body that has
important oversight and regulatory functions, not to mention approving new surgical
facilities.
Another objective of the Alberta government is to encourage more doctors to adopt a
different payment model. Most Alberta physicians (80%) are paid on a fee-for-
service (FFS) basis, a model which is believed to encourage physicians to maximize
the number of patients they see in a day. The MacKinnon Report on Alberta’s
Finances was critical of the FFS model identifying it as a source of inefficiency and
unnecessary cost. It also recommended legislating the compensation model
(Government Alberta, 2019).
Many provinces have moved to Alternative Payment Plans (APPs) to compensate
doctors, encouraging team-based primary care (Lange, et al 2020). In Alberta,
however, the government has been blocking the ability of many physicians to switch
to Alternative Relationship Plans (ARPs), equivalent of APPs in other provinces. The
process has generally taken at least 2 years without any certainty that an ARP will
be approved. Many have given up and instead continued in FFS arrangements. In
addition, government has been reducing funding for Academic ARPs, thus forcing
many academic physicians to practice on an FFS basis.
Examples of existing ARPs are the Primary Care Clinic at CUPS (the Calgary Urban
Project Society), arrangements where doctors practice and teach or work within
inter-disciplinary groups of medical professionals. They are paid a fixed amount for
their services and the model works well in many circumstances.
Bill 30 may encourage more practitioners to opt for an ARP. However, the difference
lies in the way in which these plans will be negotiated and the challenge will be to
ensure that future contracts are equally beneficial. In the current political climate
where the security of contracts is in some doubt, physicians would be reluctant to
negotiate new ARP contracts especially because the AMA will no longer be involved
in negotiations.
As mentioned above, the Mackinnon Report recommended a move away from the
Fee-for-Service compensation model and the Minister is moving in that direction. He
is poised to contract directly with doctors or corporations to do surgeries and perform
other functions, bypassing the AMA completely. Rather than doctors operating within
the public system, Bill 30 opens the door to for-profit corporations employing doctors
and billing the government directly. It is possible that instead of signing a collective
agreement with Alberta Health, doctors would be bound to employee contracts with
companies like Telus or Loblaw’s (Graf-McCrae, 2020).
If cost-cutting is a major goal in health care reform, then it makes little sense to add
administrative costs. A major strength of our single-payer system is that
administrative costs are kept to a minimum. However, with increasing fragmentation
the (relatively) streamlined compensation scheme will become much more complex
8and thus, require more administration. It is estimated that in the United States,
excess administrative costs added $190 Billion to health care expenditures. In
addition, untold hours are wasted by American clinicians every year, navigating their
complex payment system: the cost is estimated to be $85,000 for each clinician
(Evans, 2013). More recent estimates on the billions wasted on providers’ billing-
related bureaucracy pegged that figure at $401 Billion. This is generated by the time
spent attributing costs and charges to patients, visits and fighting with insurers to
extract payment (Himmelstein & Woolhandler, 2020).
Health Minister Shandro is nudging doctors in the direction of private clinics by
emphasizing the benefit of being relieved of administrative burdens. He stated that
such move would allow doctors to “focus on providing care instead of focusing on
administration,” freeing them up to spend more time with their patients (Huffington
Post, July 30, 2020). His statement acknowledges the role administration plays in
health care.
The vastly expanded number of entities in health care and the different categories of
providers give rise to two problems: firstly, it will be costly to employ sufficient staff to
monitor all these facilities and secondly, given the Kenney government’s enthusiasm
for cutting red tape, it is unlikely that the rigorous oversight that is necessary would
be forthcoming.
Virtual Medicine
Virtual care (sometimes “telehealth” or “e-health”) is an alternative to in-person visits
to a doctor. It enables patients in remote areas, those who are infectious, or cannot
travel to the doctor’s office for any reason, to consult them virtually. Medical care has
been delivered remotely for decades: specialists in urban hospitals have directed
doctors in rural and very remote areas as they performed surgery on patients. The
811 Health Link is a useful way of triaging patients and there are several programs
that already use tele-health (McIntosh, 2020). The availability of apps has taken this
to a whole new level.
Using apps that can be downloaded onto devices, patients and physicians now
enjoy an added degree of flexibility and efficiency which was not possible before.
Patients had expressed interest in such alternatives, but until Covid-19 reared its
head, few doctors were keen on switching to virtual mode for technical and
administrative reasons.
The need for virtual medicine has spiked as a result of the pandemic and provinces
have facilitated the move by adjusting billing codes to enable doctors to consult their
patients in novel ways (Hardcastle, 2020). Many physicians have added virtual care
to their patients on the phone or via Zoom.
Telus Health has partnered with Babylon, a British tech startup whose laudable
mission is: “To put an accessible and affordable health service in the hands of every
9person on earth." It is just one of the numerous other such apps that are available.
Babylon has a smartphone app, “GP at Hand” which is used by some of Britain’s
National Health Service (NHS) practices offering digital and in-person consultations
to patients (Olson, 2018).
The partnership between Telus and Babylon pre-dates the pandemic. However, in
March 2020, the Health Minister announced the joint initiative with Telus Health that
allows Albertans online access to a doctor.
The Babylon app which Alberta Health announced would be available, includes a
symptom checker, the ability to make appointments, get prescriptions and referrals
for diagnostic imaging and to specialists. So what’s not to love about the service?
There is no question that initiatives like Babylon are convenient and efficient.
However, critics have identified a number of pitfalls with the app including privacy
issues, quality of care, the lack of continuity of care, built-in biases and access to
technology (Hardcastle, 2020; McIntosh 2020). It should also be pointed out that
there are limits to virtual care. Being unable to conduct a physical exam on a patient
is a serious limitation in many circumstances.
Questions have been raised about the security and ownership of data collected by
Telus/Babylon. As a company which operates internationally and which stores and
shares data with its providers worldwide, Babylon is not automatically captured by
Canadian or Alberta privacy laws which constrain the use of that data. Like most
apps that individuals use, patients will be asked to agree to the Terms of Service.
When asked this question, how many of us wade through the legalese rather than
clicking on “Accept” automatically? Unwittingly, we might consent to the use and
storage of our health information offshore. A relevant question is, who owns the
data?
It is evident that technological advances have outstripped the ability of governments
to regulate them, especially in the area of privacy. A study from the University of
California Berkeley demonstrates that Artificial Intelligence (AI) has rendered
obsolete American privacy laws which were introduced in 1996. Researchers found
that even if you strip all identifying information from health data, an individual is not
protected. Unlike Humpty Dumpty’s experience, scraps of data can be pieced
together again by matching anonymized information with data from step data
collected by activity trackers, smartwatches and smartphones and other devices
(Redmore, 2019).
Other jurisdictions face similar issues with privacy laws that have not kept pace with
the rapid developments in AI. Commentators have pointed out the urgent need to
address these issues because advances in this field appear unstoppable.
Ironically, the efficiency of 24/7 access has a downside which can affect the quality
of care received by patients. A doctor will always be available for a consultation, but
10each interaction will be with a different doctor in the stable. This is the equivalent of
a virtual walk-in clinic rather than the continuity of care patients would receive from
their family doctor (Hardcastle, 2020). For patients with complex medical needs, this
could pose an additional problem because Babylon doctors do not have access to a
patient’s complete medical record (McIntosh, 2020).
There have also been problems with the symptom checker which uses Artificial
Intelligence to diagnose a problem and make recommendations to a patient. The
diagnosis has at times, proven to be wrong (Olson, 2018). However, it should be
pointed out that proponents believe that the symptom checker will improve as it
“learns” from each additional consultation.
Great strides have been made in the use of AI methods of machine learning in the
field of medicine. From radiology to cardiology, it is improving accuracy and
efficiency not only in diagnosis, but also treatment in many areas (Ahuja, 2019). As
mentioned above, developments are rapid and have the potential to revolutionize the
practice of medicine by providing practitioners with powerful diagnostic tools.
Despite fears that physicians might be replaced by AI, the more optimistic view is
that it will augment the work they do rather than supplant them. The challenge will be
an intelligent use of emerging technologies with the medical profession closely
involved in developments. In-person interaction between doctor and patient will
continue to be necessary as machines cannot dispense the empathy and
compassion that is so essential in medicine. Nor can they read body language or the
subtle linguistic and cultural cues that humans can.
In addition to the other limitations of AI, critics are questioning its neutrality: Studies
have found that algorithms used to predict which patients would benefit from
particular treatments were found to embody significant racial bias (Globe and Mail,
2021).
Another issue to keep in mind is that not every patient has access to the technology
required to use an app such as Babylon’s. Those excluded would be groups like
seniors, the homeless and those who cannot afford devices and internet connections
(Hardcastle, 2020). In remote areas, access to Wi-Fi is limited, if available at all.
Virtual care is here to stay but unless governments update privacy laws and regulate
providers adequately, Canadians will lose control over their medical records with
potentially dangerous consequences. The inexorable march of new technologies in
the medical field demand nothing less than swift attention.
CONCLUSION
The takeaway from Bill 30 and other recent developments, is that it jeopardizes the
health care system at many levels. In addition to creeping privatization and
11corporatization, it is shaking up the medical community and hurtling into tele-health
without building in necessary safeguards.
Arguably, the most momentous change flows from injecting numerous new actors
into the delivery of health care. To ensure the safety of patients, these entities will
require rigorous oversight and regulation by Alberta Health. Absent such monitoring,
there is no guarantee that the quality of care we currently receive, will continue. The
Alberta government has signalled very clearly, via the Red Tape Reduction Act,
that it favours less regulation and monitoring, not more.
As pointed out above, administrative costs rise dramatically when more complexity is
inserted into the payment system.
It is likely that increased private delivery will come with a loss of transparency and
accountability. Ironclad contracts with various parties will be hidden behind an
iron curtain of commercial confidentiality. Private providers will not be subject to
public scrutiny thus depriving Albertans of the ability to assess whether they are
getting value for their money. Who will be responsible for ensuring the quality of care
for patients if the government does not take its responsibilities seriously?
Health care in Alberta can certainly do with some reform, but this should follow a
fulsome conversation and a robust debate on a public service that is cherished
above any other. Such an exercise is essential so that Albertans are clear that they
are the major beneficiaries of these reforms.
12APPENDIX A
BACKGROUND
Some background on health care in Canada may be necessary to help readers
understand how it works. As we have a federal system, power is divided between
the national government and the provinces.
Because health care is mainly a provincial responsibility, we do not have a uniform,
national health care system, but 10 provincial systems held together by common
principles. The federal government does have some constitutional responsibilities in
the field like public health which includes emergency preparedness during a
pandemic or other health-related emergency, a key regulatory role in food and drug
safety as well as approval of new drugs. Should the need arise, Ottawa could,
theoretically, impose measures like a national quarantine. However, such actions
would only be taken in conjunction with provincial governments which also play a
role in public health. The federal government is also responsible for the health of
Indigenous people although the provinces generally deliver such care.
While the provinces are responsible for the provision of health care to their
populations, they require funding from Ottawa to enable them to do so. Since 1984
when the Canada Health Act was passed, the provinces are required to abide by its
5 conditions (comprehensiveness, universality, accessibility, portability and public
administration) in order to receive funding from the federal government. If a province
imposes user fees or permits extra-billing by providers, there may be deductions
from federal transfers.
Given the nature of federal-provincial relations, the federal government does not
interfere in the day-to-day operations of provincial health care systems. Ottawa
does not dictate how its funding should be directed unless it is meant to be
channeled to a specific target such as medical technology or wait-time reduction.
13APPENDIX B
EUROPEAN MODELS
Many Canadians wonder why Canada does not have a mix of public and private health
care as they do in European countries. We are very familiar with the dreaded “two-tier
American-style” system so it would be useful to explore other examples. In the 1990’s
Ernst & Young (which recently advised the Alberta government on health care reform)
counselled its clients looking for access to the health care system, to stress European
models in their quest to gain a foothold in Canada (Barrie, 2004).
As mentioned at the outset, cross-national comparisons can be problematic so a
cautionary note needs to be registered here. Different studies may reach different
conclusions because definitions are not standard, each uses disparate sources of data
and differing methodologies (McAlister et al. 2018).
Each health system sits within a unique basket of histories, social programs and policies
which reinforce each other. There is a lot of variation in Europe, but it would be fair to
say that citizens in European countries agree on some fundamental principles. They
recognize the necessity and benefits of paying taxes. They also believe that members
of a community subsidize each other: the healthy subsidize the sick; the rich subsidize
the poor and the young subsidize the old. The strong social safety-net in European
countries includes not just health care but also dental care, pharma-care and other
benefits like free tuition at universities.
There are two broad approaches to funding health care, a (German) Bismarckian
system with payroll deductions and a (British) Beveridge system funded through general
taxation. The German system represents the former, grounded in mandatory health
insurance with deductions from wages. Germans pay over 7% of their wages for health
care, a figure that is matched by their employers. In addition, they pay almost 2%
towards long-term care insurance (Commonwealth Fund, 2017).
The French system has been moving closer to the Beveridge model, with less reliance
on payroll deductions. In the last three decades, the employee deduction for health care
has dwindled to less than 1% while the employers’ share remains at 6.8%. The French
government introduced a General Social Contribution in the 1990s and most of it goes
towards health care. Employees now pay 9.2% on earned income and a higher rate on
other sources of income including investments, gambling and pensions (Blevins,
Franks, 2019).
In Britain, health care is funded through general taxation and, like Canadians, patients
do not pay at the point of service. There is a two-tier system in the United Kingdom that
runs parallel to the public system. Approximately 11% of the population carries private
insurance paid for primarily by their employers. While this gives them faster access to
elective surgery, it does not reduce wait times for the rest of the population. In 2019,
14prior to the pandemic, there were 4.4 million patients in England who were waiting for
hospital treatment (Daily Mail, 2019).
In Europe, public and private hospitals co-exist, both private insurers and non-profit
insurance companies provide coverage for the population. There is a robust non-profit
sector in many European countries, a legacy of mutual associations and cooperatives
that have a long history there.
It would be a mistake to assume that market forces have free rein there. Medical
entrepreneurs in North America would chafe against the constraints private providers in
Europe face. In fact, the extent of regulation is so great that the German case has been
described as “manacled competition.” In Sweden, where the system is very
decentralized, regions dictate the hours private clinics can operate and these clinics are
not allowed to compete on price (Commonwealth Fund, 2017). In France, for-profit
companies can provide supplementary and complementary health insurance, but only
for a limited list of services. French private insurance companies cannot request
information from prospective customers on their health status (Thomson, et al.).
European models are more comprehensive and have many admirable features which
Canadians envy. However, it is doubtful whether they would travel successfully across
the Atlantic unless they include a strong non-profit sector. The benefits Europeans enjoy
are not trivial nor is the price they pay for them. If Canadian employers had to match
employee contributions to health care, it is doubtful they would welcome such a move.
More importantly, would provincial governments monitor and regulate for-profit
providers as stringently and conscientiously as governments do in Europe?
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