News and views from the President/CEO

Colleagues

I hope you've all had a relaxing and refreshing Summer break.  As you'll know, we've got challenging times ahead of us.

Since my last blog I've continued my "Travel Alberta" program, most recently to Lethbridge and on to Pincher Creek to look at a really good model of service integration in a rural setting.  On Tuesday, I gave a speech at the Calgary Rotary Club called Life in a Cold Climate: Managing Canada's Biggest Merger, about our directions and some of the challenges facing us.  A copy of this speech is available here.

The Budget

We continue to work on the budget.   In my second blog post back in April, I talked about the "budget blues."  I mentioned that "we had quite a big task ahead of us," and so this proved.  Although we got a 6% or so increase in funding, this is not enough to meet our current spend.  The Board at its June meeting approved a budget for Alberta Health Services in 2009-2010 which was framed as involving $250M of budget savings, growing on an annualized basis to $650M.  This budget meant we would have to borrow significantly to balance in 2009-10 and would leave a gap of somewhere between $500M and $700M in 2010-11, assuming that we would achieve a funding  increase of 5.8% in 2010-11 and be fully funded for the opening of the new facilities which come on stream in that year.  A big task indeed! 

Over the last few months the Executive and senior staff have been working on identifying ways in which we can save that money.  Steps to rein in expenditures include our vacancy management program, which has tightened up on external recruitment.  My goal in all of this is to minimize potential layoffs.  We have made significant progress on identifying areas of savings, and one of the most outstanding has been the work done in procurement.   Here we look to make around $200M of savings in a full year, and we are on track to achieve that.  Those sorts of savings can only be achieved as a result of the work done, not only by the procurement folks, but by people throughout the organization who are thinking about how to standardize the products we purchase, and improve distribution of products.  We might even be able to increase our saving estimates through our collaborative work with British Columbia.  There are further savings to be achieved in back office functions.  We are looking to rationalize our multiple payroll systems, multiple HR systems, multiple IT systems and so on to achieve further savings. 

But we are aiming not only to minimize layoffs but also to ensure that service delivery is protected.  One of the examples I have talked about in the past few weeks is how we could achieve savings and improve quality at the same time, specifically mentioning patients occupying acute beds who don't need to be there - the so-called "alternate level of care" patients. If you think about it, once an acute care episode is finished, a hospital bed is a silly place for a person to be. The environment is noisy, not the least bit home-like and so on.  It is far better for that person to be in a more home-like environment, quieter, in more comfortable surroundings, than to occupy an acute bed.  It also helps us with our sustainability goal.  We staff a hospital bed for people with acute needs, the nursing staff are trained and oriented to look after people in acute need.  People in residential care have different health needs and different expectations (and rights) about maintaining their own independence.  So part of what we need to do is to open additional residential care beds, so that we can move those alternate level of care patients out of the acute facilities, thus achieving a saving and a quality improvement at the same time.   That sort of an approach is going to be a cornerstone of our budget strategies and we are now looking at these sorts of strategies across the province.  These strategies need to be carefully phased so that to take account of when residential care facilities become available. More on this soon.

This approach is also central to our thinking about Alberta Hospital Edmonton.  When I visited there earlier this year staff talked about "ALC patients" and after asking a few questions I realized there were the same issues at Alberta Hospital Edmonton as in our other acute facilities: people who are occupying acute beds with nowhere more appropriate to go.  Again, any downsizing at AHE has to be accompanied by appropriate accommodation or services being established in the community. Our commitment to our patients is clear: No hospital spaces will be closed unless and until community-based beds and services are in place.  We are currently consulting with staff at Alberta Hospital Edmonton on what appropriate services might look like.  Unfortunately the to-and-fro you see in the media on this issue is the result of our desire to consult on what is appropriate care for the people who might be moved, so we can't be more definitive about what the next steps might be.  I'd invite those who question the decision not to redevelop Alberta Hospital Edmonton to remember that if the hospital were to continue in its current form - a care model out of touch with contemporary best practice - there would be a need for a massive redevelopment.  Such a redevelopment is not currently on the approved and funded capital program and it seemed to me to be dishonest to keep pretending that such a development would happen.  I recognize that there are concerns about whether or not the community spaces will be created. To that I say: Watch us.

These sorts of strategies are in fact not enough to achieve our budget goals, so we need everybody in Alberta Health Services to put on their thinking caps to identify different ways of achieving savings.  I will be shortly writing to senior staff in the organization seeking ideas where they can develop saving strategies specific to their local organizations, zones or hospital facilities.  A number of you in your blog comments have pointed out areas of inefficiency across the organization, including comments from people who are not working to their full scope of practice. So as we issue budgets to zones and facilities we will be setting targets for further saving strategies.

But in preparing our budget strategies we must always have in mind the Strategic Directions of the organization.  We have set ourselves ambitious targets about improving Access, Quality and Sustainability.  So any saving strategies must not impact on the access and quality goals of the organization as we have articulated them in the Strategic Directions.  We have committed to improving access and quality and so I'll be looking to saving strategies and other organizational arrangements which help us achieve those ambitious targets.

Albertans have a reputation for innovation and a "can do" attitude.  It is my hope that we can harness this energy, this innovation to come up with bright ideas which we can use to achieve our budget targets and improve service for Albertans.  I have asked the three "hospital" Senior Vice-Presidents and the Zone Vice-Presidents to schedule regular discussions about different ideas that are coming forward so that there can be sharing across the organization.  That is how we can use the benefit of a single provincial organization to make sure there is learning across the province and that the bright ideas of one part of the province are able to be implemented in another. 

I am confident that with this sort of initiative we'll be able to demonstrate leadership across Canada in innovation in service delivery.

With best wishes,

Stephen