The UCP government’s plans for independent operators to run some hospitals could help improve access to health care, according to the Montreal Economic Institute.“The wait times that have become characteristic of Alberta’s and Canada’s health systems are amongst the longest in the developed world,” said Krystle Wittevrongel, director of research at the MEI. “When we look at European countries that perform better on access to care than we do, the existence of competition between care providers is the norm.” Alberta Premier Danielle Smith has announced plans to introduce competition to the province’s health care system by transferring authority over hospital management to non-governmental health operators.The move is intended to drive better performance from Alberta Health Services.A recent MEI publication found that autonomous not-for-profit hospitals tend to perform better than their government-run peers, as seen in Germany, France and the Netherlands.However, according to Wittevrongel, two key ingredients are necessary for the model to function effectively.The first is managerial autonomy, which has been shown to help bring decision-making closer to front-line health professionals and lead to faster and more efficient adaptation to changing health needs in a region.The second ingredient is the reliance on an activity-based funding model in which a hospital receives a set amount of money for each treatment carried out within its walls. Under this system, Wittevrongel says, each additional patient treated represents an immediate source of revenue for the facility.Under the current funding model, hospitals receive a fixed budgetary envelope every year, which they then spend on patient treatment over the course of the following twelve months. Since every new patient is a source of cost, this often leads to rationing of services, explains the researcher.“With the right incentives and competition, our province’s hospitals could treat more patients than they do now,” notes Wittevrongel. “By introducing such competition, the Smith government is taking a step in the right direction.“It just needs to make sure it enacts the right incentives for this reform to reach its full potential and increase access to care in the way Albertans want and deserve.”The MEI report, penned by Emmanuelle B. Faubert, says funds should be given to hospitals for services rendered instead of global budgets.“Activity-based funding, by rewarding efficiency and service quality, changes the incentive structures of health care facilities, encouraging them to treat a greater number of patients,’ writes Faubert. “While this funding method is gradually being implemented in Quebec, with 25% of hospital funding based on activity, this is not yet the case in the rest of Canada. It is widely used in Europe, however, including by non-profit hospitals.”.The analysis followed comments by Smith at a town hall for UCP members in Drayton Valley on August 17.Smith said the provincial government is changing how hospitals are run. Instead of building hospitals and handing them over to AHS, the province will keep ownership of the building."We will lease it to an operator," Smith said. "Now, why is that important? Because if our operator isn't performing the services we need them to, we're going to take it back."The premier said the possibility of losing a hospital to another provider will motivate AHS managers to do better.
The UCP government’s plans for independent operators to run some hospitals could help improve access to health care, according to the Montreal Economic Institute.“The wait times that have become characteristic of Alberta’s and Canada’s health systems are amongst the longest in the developed world,” said Krystle Wittevrongel, director of research at the MEI. “When we look at European countries that perform better on access to care than we do, the existence of competition between care providers is the norm.” Alberta Premier Danielle Smith has announced plans to introduce competition to the province’s health care system by transferring authority over hospital management to non-governmental health operators.The move is intended to drive better performance from Alberta Health Services.A recent MEI publication found that autonomous not-for-profit hospitals tend to perform better than their government-run peers, as seen in Germany, France and the Netherlands.However, according to Wittevrongel, two key ingredients are necessary for the model to function effectively.The first is managerial autonomy, which has been shown to help bring decision-making closer to front-line health professionals and lead to faster and more efficient adaptation to changing health needs in a region.The second ingredient is the reliance on an activity-based funding model in which a hospital receives a set amount of money for each treatment carried out within its walls. Under this system, Wittevrongel says, each additional patient treated represents an immediate source of revenue for the facility.Under the current funding model, hospitals receive a fixed budgetary envelope every year, which they then spend on patient treatment over the course of the following twelve months. Since every new patient is a source of cost, this often leads to rationing of services, explains the researcher.“With the right incentives and competition, our province’s hospitals could treat more patients than they do now,” notes Wittevrongel. “By introducing such competition, the Smith government is taking a step in the right direction.“It just needs to make sure it enacts the right incentives for this reform to reach its full potential and increase access to care in the way Albertans want and deserve.”The MEI report, penned by Emmanuelle B. Faubert, says funds should be given to hospitals for services rendered instead of global budgets.“Activity-based funding, by rewarding efficiency and service quality, changes the incentive structures of health care facilities, encouraging them to treat a greater number of patients,’ writes Faubert. “While this funding method is gradually being implemented in Quebec, with 25% of hospital funding based on activity, this is not yet the case in the rest of Canada. It is widely used in Europe, however, including by non-profit hospitals.”.The analysis followed comments by Smith at a town hall for UCP members in Drayton Valley on August 17.Smith said the provincial government is changing how hospitals are run. Instead of building hospitals and handing them over to AHS, the province will keep ownership of the building."We will lease it to an operator," Smith said. "Now, why is that important? Because if our operator isn't performing the services we need them to, we're going to take it back."The premier said the possibility of losing a hospital to another provider will motivate AHS managers to do better.
