04) FOR-PROFIT HOSPITAL GOES BROKE; TAXPAYERS ON HOOK

     A Calgary for‑profit hospital, once touted as "a beacon of hope for medical entrepreneurs", has declared bankruptcy, leaving hundreds of people waiting for hip and knee surgeries. Alberta taxpayers will have to pick up the pieces.

     As Calgary journalist Gillian Steward wrote in the Toronto Star, "for years, critics predicted that this experiment in privatized health care would prove unreliable and expensive. But no one imagined a scenario in which publicly funded Alberta Health Services would go to court in a bid to keep the lights on over the operating tables in an investor‑owned hospital. No one imagined that AHS would be paying receivership fees in order to keep the doors open. But this is, in fact, what has happened because Calgary's public health‑care system is so reliant on private partners."

     HRC was a focal point of the Alberta Conservative government's health‑care strategies. Passed in 2000, the Health Care Protection Act gave private surgical clinics the ability to keep patients overnight. The change allowed HRC to perform surgeries that had previously been permitted only in public hospitals.

     As Steward explains, HRC catered mostly to clients of Workers' Compensation, but the clinic could not survive without lucrative contracts from the publicly funded health‑care system.

     The Klein government had closed three public hospitals in Calgary to cut spending, causing a shortage of operating theatres. HRC had taken over part of one closed hospital, and lobbied cabinet ministers and the local health authority to secure contracts to provide surgeries for patients who could not be accommodated in the public hospital system.

     In 2004, the regional health authority awarded HRC a two‑year contract worth $20 million for the provision of 2,500 hip and knee surgeries. The health authority paid HRC 10 percent more than the cost of surgeries done in a public hospital, but claimed it had little choice.

     Now making money, HRC expanded into expensive space in a new development. But the private clinic was soon defaulting on payments, and eventually declared bankruptcy.

     Alberta Health Services went to court in an attempt to save HRC, since without the private clinic there are not enough operating theatres to accommodate all the patients scheduled for surgery.

     Meanwhile in British Columbia, some patients are suing the provincial government for reimbursement of fees they paid to private clinics for surgeries normally covered by medicare.

     Steward calls this "another trip to the courts that will cost the taxpayer plenty and divert even more money away from health care."

(The following articles are from the February 15-28, 2013, issue of People's Voice, Canada's leading communist newspaper. Articles can be reprinted free if the source is credited. Subscription rates in Canada: $30/year, or $15 low income rate; for U.S. readers - $45 US per year; other overseas readers - $45 US or $50 CDN per year. Send to People's Voice, c/o PV Business Manager, 706 Clark Drive, Vancouver, BC, V5L 3J1.)