Here’s what really happens when governments cut corners by outsourcing surgeries to private clinics.

The Conservative Party of BC have made a scary election pitch to fix wait lists for surgeries and diagnostic services by expanding “publicly funded partnerships in non-governmental facilities”. In other words, BC Conservative leader John Rustad wants to increase the use of private clinics, claiming this model will help put “patients first”. 

But a large body of international evidence and failed Canadian experiments clearly shows that private clinics erode the public health care system we all rely on. In fact, outsourcing publicly funded surgeries has proven to put profits, not patients, first. 

Instead of improving public services, here are seven predictable outcomes tied to contracting out: 

1. Private clinics make staffing shortages worse and destabilize public hospitals. 
   Because private clinics draw from the same limited pool of health care workers, shifting resources to the private sector necessarily drains hospitals and the public sector of needed staff.

2. For-profit delivery risks patient safety and care quality.
   Both Canadian and international experience shows that private for-profit facilities often cut corners to reduce costs, including hiring fewer and less skilled personnel. In some cases, this is associated with higher morbidity rates in the private sector.

3. Private sector surgeries are more expensive to the public.
   For example, in 2016, BC’s plan to pay for-profit clinics for MRIs was nearly twice as expensive as the same service within the Vancouver Island Health Authority. In addition to higher costs for surgeries, taxpayers also pay more for monitoring, regulation, and enforcement that’s needed to maintain consistent, legal standards.

4. For-profit facility ownership introduces financial conflict of interest in medical decision-making.
   Dual loyalty, to profits and patient care, can lead to upselling, self-referrals, and clinically unnecessary procedures. For-profits also have an incentive to take on easier surgeries, leaving the public system with more complex, expensive cases.

5. Increased for-profit delivery opens the door to legal gray zones and illegal practices.
   Many for-profit companies that receive public funds have fostered two-tier health care through unlawful extra-billing contrary to the BC Medicare Protection Act and the Canada Health Act.

6. Increased outsourcing increases the power of domestic and US institutional investors over our health care system.
   A single private equity firm, nearly a monopoly, owns the largest national network of independent surgical centres, made up of 53 operating rooms spread across 14 Canadian cities. Once private-for-profit clinics have established contracts with the province, they strategically engrain themselves in the system, make themselves indispensable, and grow bolder in setting the terms of contracts.

7. Contracting out does not help reduce wait times.
   Provinces that have the most for-profit clinics and hospitals (British Columbia, Quebec, Alberta) generally show poorer wait time performances than provinces with little to no privatization. 

The majority of Canadians want to see our public system improved, not dismantled. Most who support contracting out don’t know just how counterproductive this practice has been for the pursuit of shorter wait times and a stronger health care system. 

Canadian provinces, including BC, have tended to focus on short-term funding injections to increase surgical volumes in both for-profit clinics and public hospitals. While these initiatives may seem like attractive quick fixes, they often replace needed long-term investments and structural reforms to increase public hospital capacity. 

It’s time we move on from short-term fixes and put some real effort into proven public system improvements, like fully utilizing public operating rooms, making team-based referral models the norm, adopting a “first available surgeon” centralized waiting list management model, and, yes, phasing out public funding for for-profit clinics.

Resources

At What Cost? Ontario hospital privatization and the threat to public health care | Andrew Longhurst, Canadian Centre for Policy Alternatives

Data shows privatization has reduced surgical capacity in our hospitals |Friends of Medicare Alberta

Evaluating trends in private equity ownership and impacts on health outcomes, costs, and quality: systematic review | Borsa A, Bejarano G, Ellen M, Bruch J D. doi:10.1136/bmj-2023-075244

Failing to Deliver: The Alberta Surgical Initiative and Declining Surgical Capacity | Andrew Longhurst, Parkland Institute

Gaétan Barrette proved that private healthcare costs more than public healthcare | Anne Plourde, Institut de recherche et d’informations socioéconomiques

Illegal, Unlawful and Unethical: Case Studies of Patients Charged for Medical Care in Ontario’s Private Clinics | Ontario Health Coalition 

Private equity in health care: should Canadians be worried? | Danyaal Raza & Karen Palmer, Healthy Debate

The concerning rise of corporate medicine | Andrew Longhurst, Canadian Centre for Policy Alternatives