In January, the Ontario government announced plans to increase the number of cataract surgeries and diagnostic tests performed in for-profit clinics, and subsequently introduced legislation that will allow the for-profit sector to perform more complex procedures, including hip and knee replacements.
The announcement comes as health systems across the country have been struggling to reduce backlogs in addition to other ongoing stresses on the health-care system, which have been worsened by the pandemic.
The Ontario government claims that a permanent and expanded role for the for-profit sector in publicly funded health-care delivery is needed to reduce wait times. This is a curious claim when recent data reveals the province already has the country’s shortest wait times for most of the identified priority procedures with relatively little existing for-profit surgical outsourcing. There is no question that wait times should improve further, but Western Canada’s experience with for-profit delivery offers a cautionary tale.
Investments in the public system have improved wait times in B.C.
Outside of Quebec, Western Canada has the largest for-profit surgical and diagnostic sector. In Alberta, where about 20 per cent of surgeries are outsourced, fewer Albertans were receiving surgery within the priority procedures benchmark in 2021, compared to the Canadian average (see table 1).
Even before the pandemic, B.C. and Alberta struggled with reducing wait times. While Alberta had a greater focus on for-profit delivery, B.C.’s success in improving its surgical backlog can be attributed to large investments in public sector capacity. B.C.’s public operating room (OR) funding increased by 5.2 per cent from 2019/20 to 2020/21, while in Alberta, it was reduced by 2.4 per cent. In turn, B.C. comes close to Ontario for wait times for hip and knee replacements.
For-profit delivery worsens staffing shortages, which leads to longer wait times
Concerns raised by the College of Physicians and Surgeons of Ontario, hospital executives, health-care unions and researchers about worsening public-sector staffing shortages are well-founded. It takes many years to train health-care workers and the pool will likely be relatively fixed for the foreseeable future. Diverting the workforce to for-profit clinics will worsen shortages, and thereby increase wait times, in the public system.
The risk is that for-profit centres may attract workers from struggling public hospitals. These centres offer reduced workload, lower patient complexity, more regular hours and higher pay – at a time when hospitals are so short-staffed that they are increasingly forced to rely on private, for-profit agency staff. In 2019/20, about one-third of Ontario hospital operating rooms were under-used, a fact that the auditor general attributes to inadequate planning and staffing.
For-profit delivery is more expensive – and lower quality
While for-profit health-care delivery can destabilize hospitals by poaching staff, it’s also more expensive than public and non-profit provision because of the need to make a return on investments.
For example, outsourced knee surgeries funded through B.C.’s workers’ compensation system cost nearly four times more in a for-profit clinic compared with in a public hospital ($3,222 vs. $859) with worse outcomes. In 2016, the Vancouver Island Health Authority (now known as Island Health) paid for-profit clinics nearly twice the per-scan price ($550) for MRIs than it cost in the public system ($300). In Ontario, cataract surgeries are more expensive in for-profit centres than equivalent care in not-for-profit hospitals.
Canadian and international research tells us that for-profit health-care delivery in hospitals and ambulatory care facilities and long-term care homes also comes with greater risks to patient safety because these agencies tend to employ fewer staff and fewer high-skilled personnel. In England, a recent study by researchers at the University of Oxford, concluded that “private sector outsourcing corresponded with significantly increased rates of treatable mortality, potentially as a result of a decline in the quality of health-care services.”
The problems of unlawful extra-billing and corporate power
In B.C., a well-established for-profit sector has benefited from both government outsourcing (totaling $393 million over six years) and unlawful extra-billing under the Canada Health Act. The issues of publicly funded for-profit delivery (at no cost to the patient) and private payment (also called two-tier health care, where the patient pays to “jump the queue”) cannot be easily separated.
While Premier Doug Ford is fond of saying that Ontarians will always pay with their OHIP card and never their credit card, that’s not what has happened with the growth of for-profit clinics in Western Canada. More two-tier health care, with patients paying out of pocket for publicly insured care, has been a consequence of the for-profit sector’s growth in British Columbia. So much so that from 2016 to 2020, the province lost $83.3 million of its federal health transfers as a penalty for extra-billing.
Earlier in March, the federal government announced that Quebec, B.C. and Alberta had the most illegal patient charges in 2020, largely due to for-profit surgical and diagnostic imaging clinics. In B.C., at least two for-profit surgery centres receiving public contracts had been audited and found to have engaged in unlawful extra-billing.
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Further, B.C.’s longest-standing for-profit facility, Cambie Surgery Centre, has been fighting in the courts to strike down legislation that upholds the core principle of medicare in Canada – that access to health care should be based on need and not the ability to pay. While the case has been dismissed by the B.C. Supreme Court and the Court of Appeal, the centre is now expected to appeal to the Supreme Court of Canada.
As the for-profit surgical and diagnostic sector grows in this country – especially with the creation of a $600-million market for hip and knee replacements in Ontario – we worry that powerful corporate chains will emerge, similar to what has happened in the for-profit long-term care sector.
An example is the Clearpoint Health Network, a national private equity-owned surgical chain with 14 facilities and 53 ORs that seeks to become a permanent fixture in health-care delivery. Clearpoint charges patients more than $20,000 per surgery by exploiting a loophole in the Canada Health Act.
For-profit surgical corporate chains could form powerful lobby groups that effectively set the prices for government outsourcing as the public system loses its capacity to deliver these services. The chains are also likely to work to prevent the introduction of more-stringent quality standards, and may use legal and lobbying strategies in an attempt to erode the Canada Health Act to pave the way for private health insurance for surgical care, much like the Cambie case.
A better alternative
Provinces, including B.C. and Alberta, have narrowly focused on short-term funding injections to increase surgical volumes in both public and for-profit delivery systems. There has been no serious attention paid to structural changes that could reduce wait times over the long term. These include expanding single-entry models to eliminate bottlenecks for common procedures such as joint replacements, surgical smoothing and making full use of existing hospital ORs.
Single-entry models provide a “central intake” and a consistent patient-referral pathway for a particular health condition and surgical specialty. Currently, patients are usually referred to individual surgeons’ wait lists, where the referring physician may be completely unaware of the wait time or even if surgery is actually required. In a single-entry model, a team of surgeons and other health professionals work collaboratively to facilitate rapid assessment, triage and faster access to the first available surgeon with the appropriate expertise, or non-operative therapy. This is an evidence-based solution that can reduce wait times and improve the patient experience.
Surgical smoothing is where elective and urgent surgeries are separated into different OR streams. It reduces the long-standing problem of elective procedures being delayed or cancelled by urgent cases. The University Health Network in Toronto has implemented surgical smoothing and has found improved resource management and fewer medical mistakes.
With respect to surgical capacity, Ontario has more than 100 public, non-profit hospitals where elective procedures cannot be performed during evenings and weekends due to staffing shortages. By contrast, there are fewer than 10 for-profit independent health facilities licensed to perform surgery.
So, what’s happening? Hospital capacity is not being fully used. Changing that would ensure that patients continue to receive the high-quality care they deserve and would also help to retain health-care workers, especially nurses, in the public system.
Increasing the role of for-profit surgical delivery is not the answer to reducing wait times now or in the long term.