An untendered contract worth $600,000 between eHealth Ontario and a management consulting firm has surfaced, adding to the controversy surrounding the agency responsible for digitizing the province's health record system.

The contract went to RPO Management Consultants and was one of a growing list of contracts not opened to a competitive bidding process, sources told CBC News.

The firm, which has offices in Toronto and Vancouver, has connections to Vancouver's city manager, Dr. Penny Ballem, who served as a senior advisor with RPO before she took up the municipal post.

Ballem, a former B.C. deputy health minister, has already been ensnared in the eHealth controversy after it was revealed she was paid $30,000 in late 2008 for 10 days of consulting work on a diabetes registry for the agency without a written contract.

"I have no concern; I did some honest work for eHealth Ontario," she told CBC News.

Verbal agreements are common in the consulting world, Ballem said, and her fee was on par with what is paid in the sector and included travel and living expenses.

"It never occurred to me that I wouldn't ever get paperwork, and frankly, I never tested that because I had to go back to them and say that I was taking another position," Ballem said.

When Ballem dropped the eHealth consulting gig, RPO took over.

Ballem said she stopped serving as an advisor at RPO when she became Vancouver's city manager in mid-December 2008. The eHealth contract was doled out to RPO some time in the following months.

"There's no conflict of interest there," she said, pointing out that the health care community in Canada is relatively small.

EHealth came under scrutiny after it was revealed it failed to open more than $5.5 million worth of contracts to competitive bids.

Some of those contracts were doled out to firms with personal connections to the agency's CEO, Sarah Kramer, and chairman of the board of directors, Dr. Alan Hudson.

Kramer was fired June 7 over the scandal.

Health minister should resign: physicians coalition

Meanwhile, the Coalition of Family Physicians of Ontario, which represents almost 3,000 family doctors, is calling on Hudson as well as Ontario Health Minister David Caplan to resign, saying that "new leadership is required."

The New Democrats and Tories have also urged Caplan to step down

A third-party consulting firm, PricewaterhouseCoopers, is reviewing eHealth's books under the oversight of an internal government auditor.

The provincial Health Ministry has also asked Ontario Auditor General Jim McCarter to expedite his assessment of the agency's spending practices, which was due in December 2008.

Ontario NDP Leader Andrea Horwarth has called on the auditor general to investigate all contracts between government ministries and agencies and the consulting firm Courtyard Group. The firm was awarded nearly $2 million in sole-sourced contracts from eHealth, and questions have been raised about its ties with Hudson.

"In light of the recent revelations regarding eHealth Ontario and serious allegations of sole-source consulting contracts worth nearly $2-million, the concerns are very troubling," Horwath wrote.

EHealth was set up in 2008 to create a province-wide computerized health record system by 2015. The agency's predecessor, Smart Systems for Health Agency, folded following criticism of mismanagement and high spending on consultants.

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