Will Premier Smith revamp the outdated Alberta healthcare system?
It’s time to move on.
The Alberta election is over: Danielle Smith is the premier, and that means it is time for the politicians to put aside the campaign’s empty rhetoric and face the realities of how they can best fix a broken healthcare system.
It is estimated that as many as 800,000 Albertans do not have a family doctor to guide their care. The province is leaking physicians and struggling to recruit doctors for family medicine positions, particularly in rural areas. It will take many years to ensure that each Albertan has a doctor to guide their care.
Nurses are being recruited (especially from abroad), but far too many are still leaving the profession due to poor working conditions and burnout.
 Photo by Artur Tumasjan |
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Wait times for emergency responders, surgeries, and care at emergency departments were dire just one year ago but have improved somewhat since a government action plan was implemented in November 2022.
This plan made both a much-needed investment in human resources and innovative structural changes, including hiring more paramedics and nurses, devising alternative methods (i.e., not ambulances) for transferring patients between facilities, farming out surgeries to non-hospital surgical centres, and creating room for acute care patients by transferring eligible patients to newly established continuing care spaces.
The government has said it is committed to continuing this action plan, and, given its relative success, Smith should support the continued use of private providers in caring for patients. Almost every provincial government has turned to private clinics when surgery wait lists get too long; it’s time to stop pretending this doesn’t happen and give private providers an official role in healthcare delivery.
Another way Smith could improve and ensure the timely delivery of healthcare is to do away with a unique, yet antiquated, feature of our universal care system: the bulk funding of hospital services, also commonly known as global budgeting.
Currently, the government provides an annual sum of money to hospitals, and it is up to them to allocate funds to physicians’ services, procedures, and surgeries. If that budget runs out before year-end, the hospital has to stop doing certain types of surgeries, and wards are closed.
Under this budgeting system, each patient represents a cost to the system. It can’t be a customer-friendly system when treating fewer patients is the only way to stay within the budget!
A more appropriate alternative is activity-based funding, whereby the money follows the patient through the system. Hospitals are paid for each procedure performed and for each patient treated. More patients and more surgeries mean more money for the hospital. Wards don’t close. Operating rooms aren’t shut down. Costs are often reduced, and efficiencies improve. The government still pays for the patient’s care, but hospitals are incentivized to treat more patients.
A key obstacle to reform is, perhaps surprisingly, too much money. Alberta is the envy of the provinces in that its oil revenues have produced a $2.4 billion budget surplus. More money is typically a positive, but, in this case, too many financial resources could become an obstacle to making significant healthcare reforms. It’s simply too easy to maintain the status quo by pouring more cash into a lower-performing system instead of making necessary or money-saving innovations.
On a broader level, another obstacle to real healthcare reform in Alberta is a stubborn and naïve reliance on universal healthcare ideology. The NDP opposition party is ideologically (and, frankly, illogically) opposed to any structural reforms. It abides under the shibboleth that modern healthcare can be free, universal, and equally accessible to all Canadians.
That may have been true in the 1960s when the highest medical costs were physicians and hospital stays. But 60 years later, high-tech care that includes imaging, pharmaceuticals, and complicated surgeries has made it impossible for governments to provide enough money to care for everyone and every health need. As a result, governments are forced to ration care, and patients are relegated to months- and years-long waitlists.
This increasingly stale, one-size-fits-all model also ensures as much healthcare as possible is delivered by the unionized public monopoly at a higher cost to taxpayers.
We may want to believe we have universal medical care, but Canadians are increasingly forced to acknowledge that our formerly beloved medical system is rapidly collapsing. Urgent attention is required, and how Smith deals with it will undoubtedly be a key determiner of her success as premier.
Susan Martinuk is a Senior Fellow at the Frontier Centre for Public Policy and author of Patients at Risk: Exposing Canada’s Healthcare Crisis.
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Alberta Health Services would like to correct some erroneous information included in this article.
The provincial government provides Alberta Health Services (AHS) with an annual budget, and AHS is then responsible for allocating that budget across the continuum of healthcare services that the organization is responsible for providing.
This annual funding amount is not solely determined by government – AHS has input into the assumptions and amount based on the key priorities, known activity increases, and other inflationary requirements (i.e. union wage increases).
AHS’s priorities and the financial implications are described in the Health Plan and Business Plan and are also aligned with Alberta Health’s Business Plan. They are also outlined in AHS’ annual report and audited financial statements.
It is absolutely not correct to suggest that if a hospital’s allocated budget “runs out” before year-end, the hospital stops doing certain surgeries and wards are closed.
Based on input from both Operations and Finance, AHS carefully forecasts activity and financials and is transparent with Government about the financial trajectory. Depending on the overall financial situation and discussions with Government, resources can be reallocated.
The article goes onto the suggest that a more appropriate alternative is “activity-based funding”. AHS has already adopted this methodology, across both our acute care and continuing care areas.
Nor is it accurate to suggest that activity-based funding “incentivizes” hospitals to treat more patients. AHS provides care to as many patients who need it – the incentive is to help people recover from illness or injury, and ensuring that they receive the most effective care possible.
In addition, AHS is required to still function within the total funding received from Government. And, treating the maximum number of patients isn’t the only metric to consider – we need to consider appropriateness and quality of care.
I would like to correct some erroneous information included in this article.
The provincial government provides Alberta Health Services (AHS) with an annual budget, and AHS is then responsible for allocating that budget across the continuum of healthcare services that the organization is responsible for providing.
This annual funding amount is not solely determined by government – AHS has input into the assumptions and amount based on the key priorities, known activity increases, and other inflationary requirements (i.e. union wage increases).
AHS’s priorities and the financial implications are described in the Health Plan and Business Plan and are also aligned with Alberta Health’s Business Plan. They are also outlined in AHS’ annual report and audited financial statements.
It is absolutely not correct to suggest that if a hospital’s allocated budget “runs out” before year-end, the hospital stops doing certain surgeries and wards are closed.
Based on input from both Operations and Finance, AHS carefully forecasts activity and financials and is transparent with Government about the financial trajectory. Depending on the overall financial situation and discussions with Government, resources can be reallocated.
The article goes on to the suggest that a more appropriate alternative is “activity-based funding”. AHS has already adopted this methodology, across both our acute care and continuing care areas.
Nor is it accurate to suggest that activity-based funding “incentivizes” hospitals to treat more patients. AHS provides care to as many patients who need it – the incentive is to help people recover from illness or injury, and ensuring that they receive the most effective care possible.
In addition, AHS is required to still function within the total funding received from Government. And, treating the maximum number of patients isn’t the only metric to consider – we need to consider appropriateness and quality of care.
Kerry Williamson
Executive Director, Issues Management
Communications
Alberta Health Services
I would like to correct some erroneous information included in this article.
The provincial government provides Alberta Health Services (AHS) with an annual budget, and AHS is then responsible for allocating that budget across the continuum of healthcare services that the organization is responsible for providing.
This annual funding amount is not solely determined by government – AHS has input into the assumptions and amount based on the key priorities, known activity increases, and other inflationary requirements (i.e. union wage increases).
AHS’s priorities and the financial implications are described in the Health Plan and Business Plan and are also aligned with Alberta Health’s Business Plan. They are also outlined in AHS’ annual report and audited financial statements.
It is absolutely not correct to suggest that if a hospital’s allocated budget “runs out” before year-end, the hospital stops doing certain surgeries and wards are closed.
Based on input from both Operations and Finance, AHS carefully forecasts activity and financials and is transparent with Government about the financial trajectory. Depending on the overall financial situation and discussions with Government, resources can be reallocated.
The article goes on to the suggest that a more appropriate alternative is “activity-based funding”. AHS has already adopted this methodology, across both our acute care and continuing care areas.
Nor is it accurate to suggest that activity-based funding “incentivizes” hospitals to treat more patients. AHS provides care to as many patients who need it – the incentive is to help people recover from illness or injury, and ensuring that they receive the most effective care possible.
In addition, AHS is required to still function within the total funding received from Government. And, treating the maximum number of patients isn’t the only metric to consider – we need to consider appropriateness and quality of care.
Kerry Williamson
Executive Director, Issues Management
Communications
Alberta Health Services
I would like to correct some erroneous information included in this article.
The provincial government provides Alberta Health Services (AHS) with an annual budget, and AHS is then responsible for allocating that budget across the continuum of healthcare services that the organization is responsible for providing.
This annual funding amount is not solely determined by government – AHS has input into the assumptions and amount based on the key priorities, known activity increases, and other inflationary requirements (i.e. union wage increases).
AHS’s priorities and the financial implications are described in the Health Plan and Business Plan and are also aligned with Alberta Health’s Business Plan. They are also outlined in AHS’ annual report and audited financial statements.
It is absolutely not correct to suggest that if a hospital’s allocated budget “runs out” before year-end, the hospital stops doing certain surgeries and wards are closed.
Based on input from both Operations and Finance, AHS carefully forecasts activity and financials and is transparent with Government about the financial trajectory. Depending on the overall financial situation and discussions with Government, resources can be reallocated.
The article goes on to the suggest that a more appropriate alternative is “activity-based funding”. AHS has already adopted this methodology, across both our acute care and continuing care areas.
Nor is it accurate to suggest that activity-based funding “incentivizes” hospitals to treat more patients. AHS provides care to as many patients who need it – the incentive is to help people recover from illness or injury, and ensuring that they receive the most effective care possible.
In addition, AHS is required to still function within the total funding received from Government. And, treating the maximum number of patients isn’t the only metric to consider – we need to consider appropriateness and quality of care.
Kerry Williamson
Executive Director, Issues Management
Communications
Alberta Health Services
Alberta Health Services would like to correct some erroneous information included in this article.
The provincial government provides Alberta Health Services (AHS) with an annual budget, and AHS is then responsible for allocating that budget across the continuum of healthcare services that the organization is responsible for providing.
This annual funding amount is not solely determined by government – AHS has input into the assumptions and amount based on the key priorities, known activity increases, and other inflationary requirements (i.e. union wage increases).
AHS’s priorities and the financial implications are described in the Health Plan and Business Plan and are also aligned with Alberta Health’s Business Plan. They are also outlined in AHS’ annual report and audited financial statements.
It is absolutely not correct to suggest that if a hospital’s allocated budget “runs out” before year-end, the hospital stops doing certain surgeries and wards are closed.
Based on input from both Operations and Finance, AHS carefully forecasts activity and financials and is transparent with Government about the financial trajectory. Depending on the overall financial situation and discussions with Government, resources can be reallocated.
The article goes onto the suggest that a more appropriate alternative is “activity-based funding”. AHS has already adopted this methodology, across both our acute care and continuing care areas.
Nor is it accurate to suggest that activity-based funding “incentivizes” hospitals to treat more patients. AHS provides care to as many patients who need it – the incentive is to help people recover from illness or injury, and ensuring that they receive the most effective care possible.
In addition, AHS is required to still function within the total funding received from Government. And, treating the maximum number of patients isn’t the only metric to consider – we need to consider appropriateness and quality of care.
Alberta Health Services would like to correct some erroneous information included in this article.
The provincial government provides Alberta Health Services (AHS) with an annual budget, and AHS is then responsible for allocating that budget across the continuum of healthcare services that the organization is responsible for providing.
This annual funding amount is not solely determined by government – AHS has input into the assumptions and amount based on the key priorities, known activity increases, and other inflationary requirements (i.e. union wage increases).
AHS’s priorities and the financial implications are described in the Health Plan and Business Plan and are also aligned with Alberta Health’s Business Plan. They are also outlined in AHS’ annual report and audited financial statements.
It is absolutely not correct to suggest that if a hospital’s allocated budget “runs out” before year-end, the hospital stops doing certain surgeries and wards are closed.
Based on input from both Operations and Finance, AHS carefully forecasts activity and financials and is transparent with Government about the financial trajectory. Depending on the overall financial situation and discussions with Government, resources can be reallocated.
The article goes onto the suggest that a more appropriate alternative is “activity-based funding”. AHS has already adopted this methodology, across both our acute care and continuing care areas.
Nor is it accurate to suggest that activity-based funding “incentivizes” hospitals to treat more patients. AHS provides care to as many patients who need it – the incentive is to help people recover from illness or injury, and ensuring that they receive the most effective care possible.
In addition, AHS is required to still function within the total funding received from Government. And, treating the maximum number of patients isn’t the only metric to consider – we need to consider appropriateness and quality of care.
I would like to correct some erroneous information included in this article.
The provincial government provides Alberta Health Services (AHS) with an annual budget, and AHS is then responsible for allocating that budget across the continuum of healthcare services that the organization is responsible for providing.
This annual funding amount is not solely determined by government – AHS has input into the assumptions and amount based on the key priorities, known activity increases, and other inflationary requirements (i.e. union wage increases).
AHS’s priorities and the financial implications are described in the Health Plan and Business Plan and are also aligned with Alberta Health’s Business Plan. They are also outlined in AHS’ annual report and audited financial statements.
It is absolutely not correct to suggest that if a hospital’s allocated budget “runs out” before year-end, the hospital stops doing certain surgeries and wards are closed.
Based on input from both Operations and Finance, AHS carefully forecasts activity and financials and is transparent with Government about the financial trajectory. Depending on the overall financial situation and discussions with Government, resources can be reallocated.
The article goes on to the suggest that a more appropriate alternative is “activity-based funding”. AHS has already adopted this methodology, across both our acute care and continuing care areas.
Nor is it accurate to suggest that activity-based funding “incentivizes” hospitals to treat more patients. AHS provides care to as many patients who need it – the incentive is to help people recover from illness or injury, and ensuring that they receive the most effective care possible.
In addition, AHS is required to still function within the total funding received from Government. And, treating the maximum number of patients isn’t the only metric to consider – we need to consider appropriateness and quality of care.
Kerry Williamson
Executive Director, Issues Management
Communications
Alberta Health Services