Hospital governance not by necessity a ‘democratic process’ — investigator

Ontario’s public hospitals are private not-for-profit corporations. Most are built and operated with public money and sign accountability agreements with the provincially appointed Local Health Integration Networks.

At any time the Minister of Health can take over a hospital, appointing a supervisor who assumes the power of the CEO and board as she did this month in Iroquois Falls.

There used to be a time when most hospitals sold “memberships.” A membership was largely limited to voting to ratify a nomination to the board and getting to ask questions at the hospital’s annual or general meetings.

Over the years many hospitals have transitioned to self-appointing boards, cutting the public out of any direct power relationship, as limited as it may be.

Ontario is unusual in preserving individual hospital boards at all. Many provinces run their hospitals through more centralized bodies, such as directly through their Ministry of Health or by a regional health authority.

One of the reasons that the board structure has likely remained in place here is the relationship between these boards and their hospital foundations. These hospital foundations raise millions of dollars that are applied to capital acquisitions, including new equipment and expansion or replacement of buildings. Without them, there would be far more pressure on provincial budgets.

The presence of a hospital board with local community people on it at least gave the impression that the hospital had a working relationship with that community. It was also a way that local concerns could be brought to the table – especially in a province where there are more than 150 hospital corporations.

Looking at governance issues at the Anson General Hospital in Iroquois Falls, Ministry investigator Ron Gagnon dismissed complaints that the hospital had shut down the membership process in anticipation of a revolt at their upcoming general meeting. The investigator noted that 400 people in a town of 4,500 had applied for memberships.

Locals justifiably cried foul when the hospital refused to accept these new memberships. The move was anti-democratic but Gagnon appears not to be bothered.

Gagnon surprisingly wrote in his report that the move to shut down memberships was motivated by the AGH board acting in the best interests of the Corporation.

“I recognize that this conclusion will not be well accepted by many who feel that governance of a hospital should be a ‘democratic process.’ ” Gagnon writes. “The facts are that hospitals are corporations and they need to comply with the requirement of the Corporations Act. … Simply put, the running and governance of a Hospital process is not by necessity a ‘democratic process.’ ”

If there was a concession to the complainants, Gagnon did recommend the board implement a procedure to “objectively” evaluate applications for membership. Would that be as opposed to shutting the doors in panic at a time when the community should have been engaged in proposed changes to the hospital?

We also wonder what those “objective” criteria would be given most hospitals that sell memberships set the bar at having $10 (or whatever the price) and a pulse.

Further Gagnon notes the ridiculous state of affairs when members are prohibited from voting negatively on the nomination of a director. “The inclusion of this restriction seems to call into question the purpose of the members.” No kidding.

It also means that self-appointing boards tend to become cliques over time. In the case of Iroquois Falls, the investigator dances around the issue of a board that appeared to do little other than follow the recommendations of the CEO and the hospital’s lawyer. Having members democratically decide at an annual meeting that they didn’t need another bobbing head on the board may be a good thing.

While hospitals are shrinking as a percentage of health care budgets, they still stand out as health care hubs within their communities. Who gets to make decisions is important. Should accountability be only to a distant LHIN, or should the community have a more formalized tool to participate in the decision-making process? Should “community engagement” really be limited to asking us what we think, or can it go much deeper? We elect school boards, but leave hospital issues to be decided by appointees.

Like it or not, communities will get involved if they perceive their health care needs are not being met. By taking away structures — even as minimal as a membership meeting that can decide yea or nay on board nominations – means community members will seek other forums to protect their interests. That could include withholding contributions to those hospital foundations, or it could end up in the kind of divisive public battle Iroquois Falls has experienced over the last year.

This is truly something to think about.