Earlier today, the Canadian Taxpayers Federation publicly endorsed Alberta Health Minister Tyler Shandro's efforts to create $600 million in health-care savings through outsourcing, attrition and reductions in management bureaucrats.
"Today's announcement is an excellent step to make Alberta's health-care system more efficient," said Franco Terrazzano, Alberta Director for the CTF. "Alberta's businesses do a great job of doing laundry and preparing meals, so this is a no-brainer to help relieve some of the mounting costs to taxpayers."
The Alberta government announced plans to save $600 million annually by outsourcing jobs in laboratories, housekeeping, food services and laundry, and using attrition to reduce 800 government jobs. Shandro also announced a minimum of 100 management jobs would be phased out.
"AHS has a mixed model for laundry and linen services with approximately 68 percent of services outsourced across the province," according to the Ernst & Young Alberta health report. The report also noted that expanding outsourced services would "reduce the overall cost of service, take advantage of modern, higher quality processes offered by the private sector, and significantly avoid capital expenditure required to maintain the current AHS operations."
This comes in light of recent efforts to restructure physician salaries and promote transparency through a Sunshine List that is expected to be released early-2021. The Alberta Medical Association held reservations over the Sunshine List, citing concerns on the public being able to differentiate between take-home pay and gross billing hours. The AMA published a document called Context Matters: The Facts About Physician Compensation in Alberta to understand gross billing data better.
Most Alberta physicians are small business owners, according to the document. "Our offices are a significant part of the infrastructure of the health care system. From the gross payments they receive, doctors first pay their staff, then all their business bills, then taxes." On average, 40% of physician billings go directly to covering business-related expenses, while some individual physician practices are much higher (up to 75%).
Also worth noting, physicians are not privy to pensions, RRSP benefits, health and dental benefits, life and disability insurance, sick pay, reimbursement for ongoing medical education, necessary to maintain their licenses or reimbursement for additional costs such as personal protective equipment and sanitizing supplies that have become necessary due to the pandemic.
97.8 percent of nearly 8,900 physicians voted no confidence in a late-July referendum by AMA on Minister Shandro's performance. Despite the controversy amidst strained relations between the Alberta Government and the AMA, Alberta gained 246 physicians between September 2019 and September 2020.
The Alberta government would save $3.6 billion annually if it is per person health-care spending was in line with Ontario, British Columbia and Quebec, according to the Blue Ribbon Panel on Alberta's finances. The Alberta government spends more per person on health care than every other province except Newfoundland and Labrador.
"Finding savings through attrition, outsourcing and reducing management bureaucrats is necessary to find savings in Alberta's high-cost health-care system," said Terrazzano.