Trevor’s Take On: Alberta Health review of PCNs

Morgan Hrynyk Messenger, Trevor's Take On

Autonomy without accountability is a recipe for poor quality and high costs.
-Steven Lewis


With a little fanfare, and focus on spending irregularities, Alberta Health released its review of PCNs in early July. In my view, the report identifies – but fails to emphasize – some other important findings.

Primary Care Networks have been in existence for about a decade. As this report states, an audit of the PCN model by the Auditor General’s office recommended that:

  • Alberta Health define clear expectations, and targets for PCNs, develop evaluation systems, engage Albertans to clarify what PCN they belong to and its associated services, and improve financial oversight; and
  • AHS define goals and service delivery expectations, define performance measures and targets, and evaluate and report on PCN performance

This most recent review of a sample of PCNs (13 of 42, representing urban, mid-sized rural and small rural PCNs) was undertaken by AB Health to determine whether PCNs are “spending their funding and managing their operations appropriately, in accordance with current policy and oversight mechanisms”.

The findings were mixed. Here is one direct quote:

Based on the annual reports submitted by the 13 PCNs whose total expenditures in 2014/2015 consisted of $111 million, the bulk – $90 million or 81 per cent of PCN funding was used to support the PCN identified priority initiatives. On average, only 53 per cent of PCN funding went to the hiring of other health providers, while 12 per cent went to physician support, 28 per cent to administration costs and 12 per cent went to indirect patient costs such as patient panelling and scheduling of patient visits.

In addition, the review found instances of improper (“ineligible”) expenditures – for personal expenses in one case – and questionable expenditures – for physician compensation (for example).

We shouldn’t be sanguine about such expenditures recognizing that, in a health budget of approximately $20 billion, the expenditures for PCNs (about $200 million) and on primary health care services by AHS ($180 million) represent approximately 1% each (or 2% total) of overall health spending.

No one should misuse public funds. $200 million is a lot of money. But, in proportion to the total spent on healthcare in Alberta, it’s a small fraction of the total.

What the report says, but doesn’t emphasize, are the following two key features:

  • AHS was not consulted in this review
  • The Primary Care Initiative Policy Manual is out of date and does not reflect modern day operations

Why are these important?

First, because AHS is a governance partner to PCNs and “provides key support to all PCNs. AHS is involved in creation and approval of business plans that were reviewed”. How could this review be complete, or draw conclusions, when the key partner of PCNs was not consulted? Doesn’t that key partner have some accountability for the oversight and use of funds, as the money provided to PCNs flows through Alberta Health Services?

Second, while Alberta Health has certain expectations of Primary Care Networks, it has failed to exercise its own oversight responsibility or to update the policy manual. From the report:

As part of the obligations under Alberta Health’s grant agreements, PCNs submit three-year business plans to Alberta Health, which set out how each PCN will meet the primary health care needs of its community and fulfill objectives through identified service responsibilities. PCNs also submit regular reporting to Alberta Health, including progress and financial reports. Alberta Health reviews each document to ensure financial accountability and compliance with program policies and objectives at high level.

I’ve highlighted the last sentence as one would think the kinds of financial issues identified would and should have been identified and addressed through this regular process of review.

As to the policy manual, Alberta Health in its own report states:

PCNs currently rely on the original version of the PCN Policy Manual, which was completed in June 2008. Many sections of the manual are now out of date, and PCNs may be unaware of current policy. Although there has been work undertaken to update some of the policies, due to changes in government and resulting changes in policy direction, updates have not been released. The PCNs noted that they are unclear as to why Alberta Health has not distributed updated policies. The PCNs themselves have requested updates be made to the PCN Policy Manual to reflect modern day operations and to provide clear guidance for informed decision-making.

I applaud the Ministry for ‘telling it like it is’ with respect to PCNs, even if, in my opinion, the emphasis on the findings is misplaced.

Instead, I think that the focus should be on what we want PCNs to become and how they can help improve our health system. We should build on their success to date, and the importance of 80% of Albertans receiving primary medical care through a family physician affiliated with a PCN. PCNs are an important structural piece of our health system. Rather than focusing on their shortcomings (but not ignoring those), we should be asking:

  • How should PCNs (and primary care in general) be funded?
  • What are the expectations of PCNs?
  • What should governance and oversight of PCNs look like?

I have difficulty understanding how each Albertan attached to a PCN physician is worth $62 irrespective of age, complexity or location. I have difficulty understanding how PCN physicians are expected to hire multiple allied health providers (such as nurse practitioners and pharmacists) from the $62 capitation payment. (For the panel size of a thousand patients, the family physician will receive $62,000. That will not pay the salary of one pharmacist or NP, never mind three or four, as this report suggests). I have difficulty understanding how PCN leadership can meet the obligations and expectations of the Ministry of Health when the Ministry fails to update its policy manual.

If we want high quality primary medical care that serves the needs of its population, we need to provide better information, direction and oversight, but we also need to make sure we fund primary care as generously and appropriately as we fund other areas of healthcare.

Your comments and feedback are always welcome.

Trevor Theman