There is no question that hospitals are struggling these days. This is the second year of a base funding freeze that effectively translates into a real cut of three per cent or more each year. Many hospitals also have to contend with the impact of a funding formula that appears to reward hospitals in wealthier urban areas and penalize those in regions where the economy is struggling. Now Health Minister Deb Matthews has introduced a new regulation that would effectively allow private for-profit independent health facilities to “cream skim” services from the hospitals. Cream skimming is where for-profit entities are allowed to take over fee-based services hospitals rely upon.
We’ve seen examples of this in the past. When the province ended a 10-year program by a handful of small rural hospitals to do community lab work, every single hospital in the program told the province’s consultants that community lab work helped to make the hospitals labs more efficient and supplied the additional revenue needed to extend hours and purchase new equipment. The province didn’t care that the same consultants told them the private for-profit labs were doing this testing at a considerably higher cost to the provincial budget.
The effect of such cream skimming will only make hospitals less efficient and compound existing financial problems.
Matthews has always insisted the transfer of services from hospital would be to not-for-profit entities, frequently mentioning the Kensington Eye Clinic as her prime example.
However, we have seen repeatedly that this is not the case.
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