Piety and Progress: Privatization in Vancouver Hospitals

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If it reduces waiting times, are Vancouverites ready to embrace a new, private funding model for their health care?

Talking to Canadians about health care is like talking to Italians – in the movies, anyway – about mothers: our brows furrow, we’re quick to take offence. It’s not with open ears and hearts that most British Columbians greet talk of “innovation” and “competition” in hospitals.

The former president of the Canadian Medical Association returns my call the other day, and begins with a cheery “Hello, Brian Day calling.” Then the man who made reform in hospitals his calling card launches into a homily about how the new wave in Vancouver hospital funding is going to save Canadian health care.

• More: A list of private medical clinics in B.C.

The words come out of Day as if under pressure. His evangelism on health-care reform coincides with recent crowing from Vancouver Coastal Health about the success of a year-old pilot program designed to reduce waiting times in Lower Mainland emergency rooms. The health authority claims the Emergency Decongestion Pilot project has resulted in 18,000 patients receiving quicker access to care since late 2007, with the number of incoming patients placed in beds within 10 hours – a nationally mandated target – rising from 39 per cent to 67 per cent.

Day, who is not a part of the project, calls the situation in the four test ERs (Lions Gate, Vancouver General, St. Paul’s and Richmond) “much improved, but still not where it should be.”

The change being tested in the ongoing project pivots on money and how it’s distributed to the hospitals. The four ERs used to get their annual budgets in a single lump; now the provincial money is “attached” to the patient. If the patient needing an $875 MRI scan, say, comes in to Hospital A for the procedure, it gets the money. If he doesn’t, it doesn’t.

Some might argue this system encourages ERs to simply churn patients as cheaply and quickly as possible. Day, however, responds that since patients can go where they want, the pilot regime “allows administrators to become more efficient and serve the public better – it basically empowers them to offer better service.”

That sounds backhanded, like your father saying that curtailing your cushy allowance will empower you to become more entrepreneurial. But Day's idea conceals an interesting, if paradoxical, point. In the end, competing for patients (with dollars attached to them) gives hospital administrators more control over budgets. Their other option is a fixed budget with an unknown number of patients, which means that once they’ve burned through their annual cash allotment, each new patient becomes a liability, rather than a source of income.

Think about it, says Day excitedly. “Right now there are patients in the wards who’ve had a hip replacement. They’re filling the hospital because there’s nowhere for them to go. When you send them home, in comes another hip replacement who’s going to use up more of the hospital’s budget money. But if a hospital discharges them into physio and home care more quickly, the next hip replacement coming in the door is going to be another $15,000. The money follows the patient.” At this point, Day is keen to point out that if the funding attached to hip replacement is $15,000 – no more, no less – the only way for hospitals to compete will be on quality of care and service, not price.

This kind of decentralized funding will cause anxiety among hospital administrators, to be certain. Instead of a system in which funding, allocated in a block budget, is assured, a hospital’s budget will depend on being able to attract patients.

Or, as Day the Evangelist puts it, “You know, you might end up going to the place that has short lines – where they give you a cup of coffee and look after you.”

And your mother too.

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