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Review of AHS a pro-privatization attack on workers

Last week, I read all 220 pages of the AHS Review commissioned by the UCP government. Here are my main takeaways:

  1. AHS spending is probably not as dire as the UCP make it out to be, and there might not be much in the way of savings to find.
  2. The report sets the stage for a fully mask off attack on unionized workers, particularly nurses and housekeeping staff.
  3. The impetus for this review came from UCP narratives around austerity, and will be referenced as justification for further austerity.
  4. This review argues for increased privatization across several AHS areas. That’s a bad idea, exacerbated by previous governments who didn’t sufficiently protect universal public services.

The contract for the report, costing “just over $2 million”, was awarded to “Big Four” accounting firm Ernst & Young LLP (EY - famously accused of covering up fraud, money laundering, and sexist employee training videos). The Government of Alberta announced that they were awarding EY the AHS Review contract on 18 July 2019, and the full report was published just over 6 months later, on 3 February 2020. EY also secured a similar contract to review Alberta’s Health Information Systems on 5 September 2019 that was due to the GoA in January 2020.

As far as reading materials go, it’s predictably dry, and surprisingly poorly written (“8.7%%,” “expertise of experts,” “moral” instead of “morale,” numerous missing words, etc.) The report organizes its findings and recommendations according to four key domains: people, clinical services, non-clinical services, and governance. The findings are a mix of results from the review process, literature review, and UCP platform talking points. The review does not address how its recommendations would relate to best practices for patient care or workers.

The origin of this report goes back to February 2019 when then-Opposition Leader Jason Kenney promised to find anticipated annual savings of $300-450 million to ‘reinvest’ in the healthcare system. At the same press conference, Kenney signed a comically large Bristol board ‘Public Health Guarantee’ and promised not to cut health funding. After winning the election, however, the UCP’s 2019 budget instead committed to cutting healthcare expenditure by 17% over four years when taking into account inflation and population growth.

Kenney’s rationale for commissioning this report from EY is that Alberta simply spends far too much on healthcare, and that that’s a bad thing. The review explicitly states that health spending would have to stay flat for four years to match other provinces’ per capita spending (budget 2019 indicates the government’s intention to do just that), and revisits the McKinnon Report’s assertion that Alberta overspends on public services in general. As is common in many reports about Alberta, the AHS review uses Ontario and British Columbia as comparators for Alberta’s performance. Considered as a proportion of the budget, Alberta’s health spending seems hardly out of line. The review notes that healthcare spending accounts for approximately 43% of Alberta’s budget. Ontario spends about 40% of its budget on healthcare, while healthcare in BC accounts for 39.4% of the budget.

Suggesting that fears about healthcare overspending are overblown, the AHS review finds that AHS gets good value across a broad swath of categories like staff sick time use and reducing lengths of stay in hospitals. Areas identified for improvement, like expanding community-based mental health supports that could reduce mental health hospitalizations, are things that require investment, not cuts. The report makes numerous references to the economies of scale and administrative efficiencies associated with having one health authority instead of fragmented ones across the province. This assertion makes for an awkward contradiction in the sections calling for increased contracting out and privatization—shifts that would minimize those efficiencies for AHS.

Given Ernst & Young’s experience in audits and accounting (aforementioned fraud allegations aside), the financial aspects of this report are fairly insightful. The review is quick to point out in several places that the projected savings for each recommendation are not “expected or even achievable” once implementation costs and downstream effects are taken into account (p 5). Even after that gigantic caveat, the anticipated gross savings are quite modest. Of the 57 recommendations, only 6 project savings of over $100 million (the AHS budget was $15.2 billion in 2018-19). One of those recommendations is selling AHS’ wholly owned long-term care subsidiaries, which is a particularly bad idea with no specific savings attached in the report (more on that below).

AHS is Alberta’s biggest employer (p 25). Of the AHS workforce, 91.3% are unionized. Of those 27.9% are with the United Nurses of Alberta (UNA), and 27.5% are with the Alberta Union of Provincial Employees-General Support Services (AUPE-GSS). You might think that these realities would lead the review to treat workers’ issues as important. You’d be wrong. Similar to recent UCP calls to cut public sector wages by 2-5% (even as they give large tax breaks to private companies), this review recommends reducing spending on staff pay by reducing overtime (without hiring more nurses?); reducing RN and PRN positions in favour of LPN and HCA positions; and removing some collective agreement provisions that protected benefits and rest days for part time nurses. In non-clinical staffing, the review goes even further, recommending outsourcing (privatizing) more housekeeping, food services, laundry and linen services, and non-emergency patient transportation. With the exception of laundry and linen services, jobs in these areas are typically unionized. Adopting these recommendations risks eroding job security, benefits, and pay for workers who provide vital services, without much indication that it will reliably save money or improve health outcomes.

Albertans should also be suspicious of claims that public sector workers in Alberta are overpaid. Relative to overall earnings in Alberta, public sector employees, particularly those in healthcare, tend to earn relatively less than their counterparts in Ontario, Quebec, and British Columbia. Albertan public sector wages are higher than comparable workers elsewhere in Canada, but Alberta’s cost of living, and wages across all sectors are also higher.

In addition to ‘outsourcing’ work, this review (and the UCP’s 2019 platform) recommends increasing the number of private surgical procedures performed in Alberta. Alberta already has privatized/contracted-out surgeries, labs, diagnostic imaging, and non-clinical staff. Consecutive governments eroded commitments to universal public health, and failed to build in barriers to privatization for workers and patients. Currently, there are 51 contracts at 42 private facilities do contracted out surgeries. The review recommends expanding the number and types of contracted-out surgeries. In a further bid to generate revenue, the report also recommends expanding options for patients to pay for private and semi-private hospital rooms, ignoring the reality that this move would also likely increase extended health benefits premiums for those with insurance.

Meanwhile, Alberta has ample evidence to indicate that contracting out doesn’t improve patient experience, particularly with regard to wait times. The review indicates that 96% of cataract procedures in Calgary are contracted out, but the same is true for only 18% of cataract procedures in Edmonton. The average wait time for cataract surgery for the Calgary zone is 20.7 weeks, whereas for the Edmonton zone it is 15.4 weeks. In other words, the mean wait time for cataract surgery in Calgary, where almost all procedures are publicly funded in private clinics, is over a month longer than it is in Edmonton. Contracting out also removes worker and infrastructure capacity from the public system, meaning that this steady erosion of universal, publicly-provided healthcare will take a long time to remediate.

EY’s AHS review suggests that Alberta could save “estimated in the hundreds of millions of dollars” through divesting and selling Capital Care and Carewest (p 91). The review also suggests revisiting fees for long-term care accommodations and non-prescription medications. Alberta has substantial private and non-profit participation in designated supportive living (DSL) and long-term care (LTC). Reducing public provisioning of DSL and LTC has proven negative impacts on working and living conditions at these sites. LTC in Alberta rarely meets benchmark criteria for minimally acceptable care, and private facilities have the greatest average deficits below minimal care. These deficits mean that patient health is at risk. Alberta’s private providers are more likely to be DSL and assisted living, where care costs are lower and there are more opportunities for providers to charge for services. This trend means that public LTC and DSL facilities are home to residents with more complex needs and numerous comorbidities (similarly, the review describes how pharmacies do not want to set up in less profitable AHS sites, leaving these higher costs to AHS). Instead, Alberta should expand its publicly owned and operated DSL and LTC facilities to ensure better work and care conditions for all patients.

So what real purpose does this review serve? It establishes a justification for the government to erode pay, working conditions, and union presence at AHS sites. It also provides a justification for increased privatization of the workforce, AHS facilities, and surgeries. These recommendations, largely pulled from the UCP platform, are going to be used to advocate for enacting those platform planks as legislation and policies. The McKinnon report from Fall 2019 is being used to similar ends.

In outlining the small and improbable budget savings associated with adopting its recommendations, this report demonstrates that AHS already has several ongoing initiatives to improve patient care and relatively efficient service provision. Instead of going after workers and jeopardizing quality of care by nickel and diming AHS, the Government of Alberta could address the revenue challenges associated with betting all those nickels and dimes on the fossil fuel industry.

What can Albertans do to learn more about their healthcare system and the people who work for it? Unions around the province are mobilizing their members and allies through info pickets and rallies around working conditions, bargaining, and privatization. Albertans can go to these events to learn more and to show solidarity with public sector workers. As Alberta’s largest employer, and as a provider of essential care to every person in the province, Albertans and our economy benefit from investments in our universal public health system. These investments will not happen while the prevailing political discourse centres on austerity and belt tightening. Changing the narrative to one that maintains or improves health system infrastructure, unionized jobs, and patient care can lead Alberta towards a better and more prosperous future.

 

Photo credit: Photo by Jair Lázaro on Unsplash

Alison McIntosh

Alison McIntosh is a research manager at Parkland Institute. She completed her undergraduate degree in Human Geography at the University of Alberta. Her master's research in Geography at Simon Fraser University was part of a SSHRC-funded, community-based project investigating food security for low-income people living with HIV who use drugs. After finishing her MA, Alison worked in student services research, and research ethics at the University of Calgary.

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