B.C.'s privatization of seniors' care raises concerns
CBC News, Business in Vancouver series looks at business of seniors' care
Private contractors are now providing the largest share of residential care for B.C. seniors, and that's raising concerns about the influence the pursuit of profit plays in the management of our rapidly aging population.
B.C. spends about $1.7 billion a year providing assisted living and residential care for seniors — but about two-thirds of the province's residential care beds are now contracted out to non-profit or private operators.
Health Minister Mike de Jong calls the private sector a "hugely important" piece of the system.
"The private sector, in responding to the needs of the market, can move fairly quickly and provide housing products that may appeal to segments of that market."
And de Jong says he see the role of private contractors and non-profit organizations continuing to grow as B.C.'s aging baby boomers enter their retirement years.
"It's historically been a partnership, and that partnership needs to continue, and looking forward, I see some real opportunities for the private sector," he said.
But not everyone agrees the privatization of seniors' care is the most effective model.
Margaret McGregor, a family doctor and clinical associate professor at UBC's family practice department, says the majority of the research shows the not-for-profit model provides better staffing levels and a higher level of care.
"Once you get large chains that are owned perhaps by shareholders who expect ... profit, there is the potential for there to be a discordance between those goals and the goals of providing good care with the public funds that are being given to these facilities," she said.
"You've got a push for profit and sometimes that will be in conflict with perhaps adding another staff or doing things in a way that undermines perhaps that profit margin."
'Making money from seniors'
The Opposition NDP is also concerned about the trend.
"Seniors' care is big business in B.C., which is really unfortunate because from my perspective I don't think that people should be making money on seniors," said NDP health critic Katrine Conroy.
About five per cent of B.C. seniors — and 10 per cent of those over the age of 75 — live in health care facilities like hospitals or residential care homes, according to 2006 numbers, the most recent statistics available.
The majority of facilities in B.C. that aren't publicly operated, whether they're privately owned or owned through a non-profit society, are publicly subsidized through the Ministry of Health or the local health authorities.
The three largest contractors — Retirement Concepts, Revera Long Term Care and Ahmon Group — receive about 10 per cent of the total funding, or about $162 million.
Statistics Canada estimates that in 2006, the daily nursing hours per resident at a facility operated by a health authority was about 3.30. That compares to 2.48 hours at a non-profit, and 2.13 at a for-profit facility.
Funding at issue
The BC Care Providers Association represents about 130 operators who run more than a third of the seniors' residential care beds in B.C.
CEO Ed Helfrich admits residents in private facilities get fewer hours of care than those in publicly owned facilities, but says that all comes down to funding.
"The whole issue of funding is one of the outstanding issues that certainly our members are advocating around," he said.
"The health authorities are actually funding their own facilities at a higher rate than they're funding the private facilities or the non-profits. That's a historical issue and it certainly came up in the recent ombudsperson's report."
And the provincial government, with its limited resources, can't meet the growing demand alone.
Provinces like B.C., Alberta and Ontario increasingly rely on the non-profit and private sector to put up the capital to build new residential care facilities.
Pressure to expand
"Certainly, with the population aging there's going to be a lot of pressure on health authorities in order to expand and build new beds," Helfrich said.
"The costs of construction now are fairly significant, you know $200,000 to $225,000 per bed, so in order to develop a new facility, it's a very significant capital investment."
Helfrich says the provincial government and health authorities need the private sector.
"Theoretically, yes, the health authorities could deliver all of the services directly, but that means they would have to make huge capital investments or else purchase the facilities out there," he said.
"I think having a mix is beneficial and having the health authorities, private, [and] non-profit working together and sharing information and resources and skills really improves the system overall."
With files from the CBC's Renee Filippone and Tracey Robertson