do regional models matter? resource allocation … · do regional models matter? resource...

DO REGIONAL MODELS MATTER? RESOURCE ALLOCATION TO HOME CARE IN THE CANADIAN

PROVINCES OF PRINCE EDWARD ISLAND, NOVA SCOTIA & NEW BRUNSWICK

By

Patricia Ann Conrad

A thesis submitted in conformity with the requirements

for the degree Doctor of Philosophy

Graduate Department of Health Policy Management and Evaluation

University of Toronto

© Copyright by Patricia Ann Conrad, 2008

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Do Regional Models Matter? Resource Allocation to Home Care in the Canadian Provinces of Prince Edward Island,

Nova Scotia, and New Brunswick

Doctor of Philosophy, 2008 Patricia Ann Conrad

Department of Health Policy, Management and Evaluation Faculty of Medicine, University of Toronto

Abstract

Proponents of Canadian health reform in the 1990s argued for regional structures, which

enables budget silos to be broken down and integrated budgets to be formed. Although

regionalization has been justified on the basis of its potential to increase home care resources,

political science draws upon the scope of conflict theory, which instead suggests marginalized

actors, such as home care, may be at risk of being cannibalized in order to safeguard the interests

of more powerful actors, such as hospitals.

Prince Edward Island, Nova Scotia, and New Brunswick, constitute a natural policy

experiment. Each has made different decisions about the regionalization model implemented to

restructure health care delivery. The policy question underpinning this research is: What are the

implications of the different regional models chosen on the allocation of resources to home care?

Provincial governments are at liberty to fund home care within the limits of their fiscal

capacity and there are no federal terms and conditions which must be complied with. This policy

analysis used a case comparison research design with mixed methods to collect quantitative and

qualitative data. Two financial outcomes were measured: 1) per capita provincial government

home care expenditures and 2) the home care share of provincial government health

expenditures. Hospital data was used as a comparator. Qualitative data collected from face-to-

face, semi-structured interviews with regional elite key informants supplemented the expenditure

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data.

The findings align with the scope of conflict theory. The trade-off between central control

and local autonomy has implications for these findings: 1) home care in Prince Edward Island

increased it share from 1.6% to 2.2% of provincial government health spending; 2) maintaining

central control over home care in Nova Scotia resulted in an increase in its share from 1.4% to

5.4%, and 3) in New Brunswick, home care share grew from 4.1% to 7.6%. Inertia and

entrenchment of spending patterns was strong. Health regions did not appear to undertake

resource reallocation to any great extent in either Prince Edward Island or New Brunswick.

Resource reallocation did occur in Nova Scotia where the hospital share of government spending

went down and was reallocated to home care and nursing homes. But, Nova Scotia is the only

province of the three in which home care was not regionalized. Regional interests in maintaining

existing levels of in-patient hospital beds was clearly a source of tension between the

overarching policy goals formulated for health reform by the provincial governments and the

local health regions.

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Acknowledgments

I would like to acknowledge the significant contribution of my supervisor, Dr. Raisa

Deber and my committee members, Dr. A. Paul Williams and Professor Lawrence Nestman

(Dalhousie University). Your ongoing guidance and thoughtful insight has been invaluable

during this academic journey.

I would like to acknowledge the following funding sources: the Canadian Institutes for

Health Research Fellowship #2690010 and the Canadian Institutes for Health Research Grant

#2590189.

I would also like to thank my reviewers, Dr. Christel Woodward and Dr. Fiona Miller for

the thoughtful feedback following and provocative questions during my defense. In particular,

Dr. Rhonda Cockerill has been a source of strength and support throughout the research phase of

my doctoral studies.

I am grateful to the Chief Executive Officers and Vice-Presidents located in rural and

urban health regions within Prince Edward Island, Nova Scotia, and New Brunswick who

generously gave their time to be interviewed. Thanks also to support staff from these

organizations and in particular, Anne McGuire, CEO, IWK Health Centre for assisting in

numerous ways throughout this policy research. During the home stretch of this endeavour some

very patient people have supported me as I completed this journey – Erin Morrison, Jose

Hernandez, Susan Law, Marty Laurence, Karen Spalding, Jennifer Thornhill, and my employer,

Canadian Health Services Research Foundation.

Very special thanks to Bev, Deborah, Vicki, Cathy, and “the Femmes” – these are

amazing women who kept me calm and grounded when the waters got rough!

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Table of Contents

CHAPTER I: INTRODUCTION AND OVERVIEW ............................................................... 1

I.1 The Policy Problem, Significance, and Need for the Study ..........................................6 I.2 Why Study Home Care in the Context of Regionalization?.......................................... 8 I.3 Research Questions...................................................................................................... 10 I.3.1 Provincial Government Home Care Expenditures .................................................. 10 I.3.2 Home Care Share of Government Health Expenditures .......................................... 11 I.3.3 Health reform agenda .............................................................................................. 11 I.3.4 Characteristics of Regional Models.......................................................................... 11 I.4 Outline of Dissertation ................................................................................................ 12

CHAPTER II: LITERATURE REVIEW AND THEORETICAL FRAME WORK .......... 13

II.1 Dimensions of Health Care Delivery ......................................................................... 13 II.1.1 Public and Private ................................................................................................. 13 II.1.2 Delivery ................................................................................................................ 14 II.1.3 Allocation ............................................................................................................. 17 II.2 Regionalization as a Policy Instrument for Provincial Health Care Reform ............. 18 II.2.1 Defining Regionalization ........................................................................................ 18 II.2.2 Design Features of Provincial Regionalization Models.......................................... 20 II.3 Theoretical Framework: Scope of Conflict and Redistributive Policy-Making ........ 24 II.3.1 Scope of Conflict..................................................................................................... 25 II.3.2 Redistributive Policy-Making ................................................................................. 27

CHAPTER III: RESEARCH FRAMEWORK AND METHODOLOGY ............................ 32

III.1 Research Approach ................................................................................................... 32 III.1.1 Natural Policy Experiment..................................................................................... 32 III.1.2 Policy Research...................................................................................................... 33 III.2 Research Design........................................................................................................ 34 III.2.1 Case Study ............................................................................................................. 34 III.2.2 Comparative Case Studies ..................................................................................... 35 III.2.3 Selection of Cases.................................................................................................. 36 III.2.4 Policy Context........................................................................................................ 38 III.2.5 Trends Over Time Analysis ................................................................................... 38 III.2.6 Mixed Methods - Combining Qualitative and Quantitative Data.......................... 39 III.2.7 Study Time Frame.................................................................................................. 40 III.3. Data Collection ........................................................................................................ 40 III.3.1 Phase One - Quantitative Data............................................................................... 40 III.3.2 Analysis of Quantitative Data - Expenditure Data ................................................ 43 III.3.3 Phase Two – Qualitative Data ............................................................................... 45 III.4. Analysis of Case Findings ....................................................................................... 46 III.4.1 Analytical Framework to Compare Regional Models ........................................... 47 III.4.2 Analysis of Case Findings and Cross Case Comparison ....................................... 47

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CHAPTER IV: THE CASE OF CANADA .............................................................................. 49 IV.1 Canada: The Rules of the Game ............................................................................... 49 IV.1.1 Federalism ............................................................................................................. 49 IV.1.2 Policy Dilemmas Associated with the Canada Health Act.................................... 49 IV.1.3 Financing ............................................................................................................... 50 IV.2. Structure of Canadian Health Care .......................................................................... 52 IV.2.1 Sources of Financing ............................................................................................. 52 IV.2.2 Health Care Delivery and Uses of Funds .............................................................. 52 IV.2.2.1 Hospitals ............................................................................................................. 53 IV.2.2.2 Other Institutions ............................................................................................... 53 IV.2.2.3 Physicians ........................................................................................................... 54 IV.2.2.4 Drugs................................................................................................................... 55 IV.2.2.5 Public health ....................................................................................................... 56 IV.2.2.6 Administration .................................................................................................... 56 IV.2.2.7 Other health spending......................................................................................... 57 IV.2.3 Allocation .............................................................................................................. 58 IV.3 Canadian Health Care Reform.................................................................................. 61 IV.3.1 Rationale and Impetus for Change ........................................................................ 61 IV.3.2 Realignment of Roles and Power through Regionalization................................... 62 IV.3.3 Local Autonomy versus Central Control............................................................... 64 IV.3.4 Resource Allocation Decision-making Under Regionalization............................. 66 IV.4 Home Care in Canada............................................................................................... 71 IV.4.1Funding and Delivery ............................................................................................. 72

CHAPTER V: THE CASE OF PRINCE EDWARD ISLAND .............................................. 75

V.1 The Policy Context..................................................................................................... 75 V.1.1 Geography and Demographic Characteristics......................................................... 75

V.1.2 Economic Characteristics........................................................................................ 76 V.1.3 Health Status Indicators .......................................................................................... 76 V.1.4 Political Environment ............................................................................................. 77 V.2 Structure of Prince Edward Island Health Care before Regionalization ................... 78 V.2.1 Hospitals.................................................................................................................. 78 V.2.2 Other Institutions – Nursing Homes ....................................................................... 78 V.2.3 Home Care .............................................................................................................. 79 V.2.4 Public Health Services ............................................................................................ 79 V.2.5 Functions of Prince Edward Island Health Ministry...............................................80 V.3 Restructuring Health Care in Prince Edward Island .................................................. 80 V.3.1 Rationale and Impetus for Change.......................................................................... 80 V.3.2 Policy Goals and Principles Underlying Regionalization....................................... 82 V.3.3 Characteristics of Prince Edward Island’s Regionalization Model ........................ 84 V.3.3.1 Population size ..................................................................................................... 84 V.3.3.2 Design, governance, and accountability: a legislative framework....................... 84 V.3.3.3 Regional functions and assignment of services ................................................... 85 V.3.3.4 Implementation of regionalization....................................................................... 87 V.4 Regionalization Results: Analyzing the Impact ........................................................ 88 V. 4.1 Hospital Funding, Delivery, and Allocation ......................................................... 88

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V. 4.2 Nursing Home Funding, Delivery, and Allocation................................................ 89 V. 4.3 Home Care Funding, Delivery, and Allocation ..................................................... 89 V. 4.4 Provincial Government Health Care Expenditures................................................ 91 V. 4.5 Provincial Government Home Care Expenditures................................................. 92 V. 4.6 Home Care and Hospital Resource Reallocation ..................................................93 V. 4.7 Regional Home Care Expenditures ....................................................................... 94 V.5 Views of Regional Key Informants: Observations about Resource Allocation ........ 95 V.5.1 Funding and Budget Methods................................................................................. 95 V.5.2 Central Control versus Local Autonomy ................................................................ 96 V.5.3 Discussion of Findings............................................................................................ 98

CHAPTER VI: THE CASE OF NOVA SCOTIA ................................................................. 112 VI.1 The Policy Context ................................................................................................. 112 VI.1.1 Geography and Demographic Characteristics ..................................................... 112 VI.1.2 Economic characteristics ..................................................................................... 113 VI.1.3 Health status indicators........................................................................................ 113 VI.1.4 Political environment........................................................................................... 114 VI.2 Structure of Nova Scotia Health Care Before Regionalization .............................. 115 VI.2.1 Hospitals .............................................................................................................. 115 VI.2.2 Other Institutions – Nursing Homes.................................................................... 115 VI.2.3 Home Care........................................................................................................... 116 VI.2.4 Public Health Services......................................................................................... 116 VI.2.5 Functions of Nova Scotia Health Ministry .......................................................... 116 VI.3 Restructuring Health Care in Nova Scotia ............................................................. 117 VI.3.1 Rationale and Impetus for Change ...................................................................... 117 VI.3.2 Policy Goals and principles Underlying Regionalization.................................... 119 VI.3.3 Characteristics of Nova Scotia Regionalization Model....................................... 120 VI.3.3.1 Population size.................................................................................................. 120 VI.3.3.2 Design, governance, and accountability: a legislative framework ................... 120 VI.3.3.3 Regional functions and assignment of services ................................................122 VI.3.3.4 Implementation of regionalization.................................................................... 123 VI.4 Regionalization Results: Analyzing the Impact ..................................................... 126 VI.4.1 Hospital Funding Delivery and Allocation.......................................................... 127 VI.4.2 Nursing Home Funding, Delivery, and Allocation.............................................. 128 VI.4.3 Home Care Funding, Delivery, and Allocation................................................... 129 VI.4.4 Provincial Government Health Care Expenditures.............................................. 130 VI.4.5 Provincial Government Home Care Expenditures.............................................. 131 VI.4.6 Home Care and Hospital Resource Reallocation ................................................ 132 VI.4.7 Regional Home Care Expenditures .................................................................... 134 VI.5 Views of Regional Key Informants: Observations about Resource Allocation .... 134 VI.5.1 Funding and Budget Methods.............................................................................. 134 VI.5.2 Central Control Versus Local Autonomy............................................................ 135 VI.5.3 Discussion of Findings ........................................................................................ 136

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CHAPTER VII: THE CASE OF NEW BRUNSWICK - HOME CARE RESOURCE ALLOCATION ......................................................................................................................... 150

VI.1 The Policy Context ................................................................................................. 150 VII.1.1 Geography and Demographic Characteristics.................................................... 150 VII.1.2 Economic Characteristics................................................................................... 151 VII.1.3 Health Status Indicators...................................................................................... 151 VII.1.4 Political Environment......................................................................................... 152 VII.2 Structure of New Brunswick Health Care before Regionalization ....................... 153 VII.2.1 Hospitals............................................................................................................. 153 VII.2.2 Other Institutions – Nursing Homes .................................................................. 153 VII.2.3 Home Care.......................................................................................................... 153 VII.2.4 Public Health Services ....................................................................................... 155 VII.2.5 Functions of New Brunswick Health Ministry................................................... 155 VII.3 Restructuring Health Care in New Brunswick .....................................................156 VII.3.1 Rationale and Impetus for Change ..................................................................... 156 VII.3.2 Policy Goals and Principles Underlying Regionalization ................................. 157 VII.3.3 Characteristics of New Brunswick’s Regionalization Model ............................ 158 VII.3.3.1 Population size ................................................................................................ 158 VII.3.3.2 Design, governance, and accountability: a legislative framework.................. 159 VII.3.3.3 Regional functions and assignment of services...............................................160 VII.3.3.4 Implementation of regionalization .................................................................. 161 VII.4 Regionalization Results: Analyzing the Impact ................................................... 162 VII.4.1 Hospital Funding Delivery and Allocation ........................................................ 162 VII.4.2 Nursing Home Funding, Delivery, and Allocation ............................................ 163 VII.4.3 Home Care Funding, Delivery, and Allocation.................................................. 163 VII.4.4 Provincial Government Health Care Expenditures ............................................ 165 VII.4.5 Provincial Government Home Care Expenditures ............................................. 166 VII.4.6 Home Care and Hospital Resource Reallocation .............................................. 167 VII.4.7 Regional Home Care Expenditures ................................................................... 168 VII.5 Views of Regional Key Informants: Observations about Resource Allocation ... 168 VII.5.1 Funding and Budget Methods ............................................................................ 168 VII.5.2 Central Control versus Local Autonomy............................................................ 170 VII.5.3 Discussion of Findings ....................................................................................... 171

CHAPTER VIII - DISCUSSION AND CONCLUSIONS ..................................................... 184

VIII.1 Comparison of Cases in a Natural Policy Experiment......................................... 184 VIII.2 Results of Cross Case Policy Analysis ............................................................... 185 VIII.2.1 Provincial Government Health Care Spending - History Matters! ................... 186 VIII.2.2 Per capita Home Care Expenditures - History Matters Again ......................... 188 VIII.2.3 Resource Allocation to Home Care Compared with Hospitals......................... 189 VIII.2.4 Data Limitations................................................................................................ 191 VIII.3 Discussion and Conclusion .................................................................................. 192

References .................................................................................................................................. 205 Appendices ................................................................................................................................. 218

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List of Tables Table 1-1: Overview of regional models implemented in Prince Edward Island, Nova Scotia, and New Brunswick........................................................................................................................ 7 Table 3-1: Two dimensional controls through comparative case studies..................................... 37 Table 3-2: The policy context: comparative indicators .................................................................41 Table 3-3: Financial indicators for provincial government home care and hospital spending..... 42 Table 3-4: Conversion of current to constant dollars.....................................................................44

Table 5-1: Selected acute care indicators, Prince Edward Island ................................................. 89 Table 5-2: Home care admissions, Prince Edward Island ........................................................... 90 Table 5-3: Average monthly caseload by home care service, Prince Edward Island................... 90 Table 6-1: Nova Scotia hospital data, 1991-2001....................................................................... 127 Table 6-2: Selected acute care indicators, Nova Scotia.............................................................. 128 Table 6-3: Home care Nova Scotia utilization data, 1995/96-2000/01 ...................................... 130 Table 7-1: Selected hospital indicators, New Brunswick ........................................................... 162 Table 7-2: Extra-Mural Program utilization data, 2000/01 ....................................................... 164 Table 8-1: Comparison of per capita provincial government home care expenditures .............. 186 Table 8-2: Comparison of home care share of provincial government health expenditures .......190

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List of Figures Figure 5-1: Government Health Expenditures, Prince Edward Island, 1990/91-2000/01 - Current Dollars .........................................................................................................................................101 Figure 5-2: Annual Percentage Change in Government Health Expenditures, Prince Edward Island & Canada, 1990/91-2000/01 - Current Dollars ................................................................102 Figure 5-3: Per Capita Government Health Expenditures, Prince Edward Island & Canada, 1990/91-2000/01 - Current Dollars .............................................................................................103 Figure 5-4: Health as Proportion of Total Government Expenditures, Prince Edward Island, 1990/91-2000/01 - Current Dollars .............................................................................................104 Figure 5-5: Government Health Expenditure as Percent of Provincial GDP, Prince Edward Island & Canada, 1990/91-2000/01 - Current Dollars ...........................................................................105 Figure 5-6: Prince Edward Island Home Care Expenditures, 1990/91-2000/01 – Constant & Current Dollars ............................................................................................................................106 Figure 5-7: Annual Percent Change in Government Home Care Expenditures, Prince Edward Island & Canada, 1990/91-2000/01 - Current Dollars ................................................................107 Figure 5-8: Government Home Care Expenditures, Per Capita, Prince Edward Island & Canada, 1990/91-1998/99 - Constant Dollars ...........................................................................................108 Figure 5-9: Home Care Share of Government Health Expenditures, Prince Edward Island, 1990/91-2000/01 - Current Dollars .............................................................................................109 Figure 5-10: Prince Edward Island Regional Home Care Expenditures, 1994/95-2000/01 - Current Dollars ............................................................................................................................110 Figure 5-11: Per Capita Government Home Care Expenditures, Prince Edward Island Health Regions & Province, 1990/91-2000/01 - Current Dollars ..........................................................111 Figure 6-1: Government Health Expenditures, Nova Scotia, 1990/91-2000/01 - Current Dollars .........................................................................................................................139 Figure 6-2: Annual Percentage Change in Government Health Expenditures, Nova Scotia & Canada, 1990/91-2000/01 - Current Dollars ...............................................................................140 Figure 6-3: Per Capita Government Health Expenditures, Nova Scotia & Canada, 1990/91-2000/01 - Current Dollars .........................................................................................................................141 Figure 6-4: Health as Proportion of Total Government Expenditures, Nova Scotia, 1990/91-

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2000/01 - Current Dollars ...........................................................................................................142 Figure 6-5: Government Health Expenditure as Percentage of Provincial GDP, Nova Scotia & Canada, 1990/91-2000/01 - Current Dollars ...............................................................................143 Figure 6-6: Nova Scotia Government Home Care Expenditures, 1990/91-2000/01 - Constant & Current Dollars ............................................................................................................................144 Figure 6-7: Annual Percent Change in Government Home Care Expenditures, Nova Scotia & Canada, 1990/91-2000/01 - Constant & Current Dollars ...........................................................145 Figure 6-8: Government Home Care Expenditures, Per Capita, Nova Scotia & Canada, 1990/91-1998/99 - Constant Dollars .........................................................................................................146 Figure 6-9: Home Care Share of Government Health Expenditures, Nova Scotia, 1990/91-2000/01 - Current Dollars ...........................................................................................................147 Figure 6-10: Nova Scotia Regional Home Care Expenditures, 1993/94-2000/01 - Current Dollars .........................................................................................................................148 Figure 6-11: Per Capita Government Home Care Expenditures, HCNS Health Regions & Province, 1992/93-2000/01 - Current Dollars ........................................................................149 Figure 7-1: Government Health Expenditures, New Brunswick, 1990/91-2000/01 - Current Dollars .........................................................................................................................173 Figure 7-2: Annual Percentage Change in Government Health Expenditures, New Brunswick & Canada, 1990/91-2000/01 - Current Dollars ...............................................................................174 Figure 7-3: Per Capita Government Health Expenditures, New Brunswick & Canada, 1990/91-2000/01 - Current Dollars ............................................................................................................175 Figure 7-4: Health as Proportion of Total Government Expenditures, New Brunswick, 1990/91-2000/01 - Current Dollars ...........................................................................................................176 Figure 7-5: Government Health Expenditure as Percentage of Provincial GDP, New Brunswick & Canada, 1990/91-2000/01 - Current Dollars ...........................................................................177 Figure 7-6: New Brunswick Government Home Care Expenditures, 1990/91-2000/01 - Constant & Current Dollars .......................................................................................................................178 Figure 7-7: Annual Percentage Change in Government Home Care Expenditures, New Brunswick & Canada, 1990/91-2000/01 - Current Dollars ........................................................179 Figure 7-8: Government Home Care Expenditures, Per Capita, New Brunswick & Canada, 1990/91-1998/99 - Constant Dollars ...........................................................................................180

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Figure 7-9: Home Care Share of Government Health Expenditures, New Brunswick, 1990/91-2000/01 - Current Dollars ...........................................................................................................181 Figure 7-10: New Brunswick Regional Home Care Expenditures, 1998/99-2000/01 - Current Dollars .........................................................................................................................................182 Figure 7-11: Per Capita EMP Expenditures, New Brunswick Health Regions & Province, 1990/91-2000/01 - Current Dollars .............................................................................................183 Figure 8-1: Government Health Expenditures, Prince Edward Island, Nova Scotia, New Brunswick, 1990/91-2000/01 - Current Dollars .........................................................................196 Figure 8-2: Annual Percentage Change in Health Expenditures, Prince Edward Island, Nova Scotia, New Brunswick, Canada, 1990/91-2000/01 - Current Dollars .......................................197 Figure 8-3: Per Capita Government Health Expenditures, Prince Edward Island, Nova Scotia, New Brunswick, Canada, 1990/91-2000/01 - Current Dollars ...................................................198 Figure 8-4: Health as Proportion of Total Government Expenditures, Prince Edward Island, Nova Scotia, New Brunswick, Canada, 1990/91-2000/01 - Current Dollars .......................................199 Figure 8-5: Government Health Expenditures as Percent of GDP, Prince Edward Island, Nova Scotia, New Brunswick, Canada, 1990/91-2000/01 - Current Dollars .......................................200 Figure 8-6: Government Home Care Expenditures, Prince Edward Island, Nova Scotia, New Brunswick, 1990/91-2000/01 - Constant Dollars .......................................................................201 Figure 8-7: Annual Percentage Change in Government Home Care Expenditures, Prince Edward Island, Nova Scotia, New Brunswick, Canada, 1990/91-2000/01 - Current Dollars .................202 Figure 8-8: Per Capita Government Home Care Expenditures, Prince Edward Island, Nova Scotia, New Brunswick, Canada, 1990/91-1998/99 - Constant Dollars .....................................203 Figure 8-9: Home Care Share of Government Health Expenditures, Prince Edward Island, Nova Scotia, New Brunswick, 1990/91-2000/01 - Current Dollars .....................................................204

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List of Appendices Appendix A-1: Template for Case Study Context ......................................................................218 Appendix A-2: Semi-Structured Interview Guide .......................................................................219 Appendix A-3: Study Fact Sheet .................................................................................................222 Appendix A-4: Consent Form......................................................................................................224 Appendix A-5: Themes Related to Reallocation of Resources by Health Regions.....................226 Appendix A-6: Provincial Document Review: Templates to Collect Data about Health Reform, Health Restructuring, and Characteristics of Regional Models ..................................................227 Appendix A-7: Cross-Case Comparison of Health Reform and Regional Models .....................228 Appendix A-8: Provincial & National Government Health Expenditures by Use of Funds.......229 Appendix B-1: Provincial Population, Prince Edward Island .....................................................231 Appendix B-2: Proportion of Prince Edward Island & Canada, 65 years+.................................232 Appendix B-3: Total Provincial Government Expenditures, Prince Edward Island ...................233 Appendix B-4: Governments of Prince Edward Island, 1990-2001............................................234 Appendix B-5: Prince Edward Island Health Reform Milestones ..............................................235 Appendix B-6: Prince Edward Island Legislation: Health and Community Services Act, Bill No. 33....................................................................................................................................237 Appendix C-1: Provincial Population, Nova Scotia ....................................................................238 Appendix C-2: Proportion of Nova Scotia & Canada Population, 65 years+ .............................239 Appendix C-3: Total Provincial Government Expenditures, Nova Scotia ..................................240 Appendix C-4: Governments of Nova Scotia, 1990-2001...........................................................241 Appendix C-5: Nova Scotia Health Reform Milestones .............................................................242 Appendix C-6: Nova Scotia Legislation: Act to Establish Regional Health Boards, Chapter 12 of the Acts of 1994...........................................................................................................................245 Appendix D-1: Provincial Population, New Brunswick..............................................................246

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Appendix D-2: Proportion of New Brunswick & Canada Population 65 years+........................247 Appendix D-3: Total Provincial Government Expenditures, New Brunswick............................248 Appendix D-4: Governments of New Brunswick, 1990-2001 ....................................................249 Appendix D-5: New Brunswick Health Reform Milestones .......................................................250 Appendix D-6: New Brunswick Legislation: The Hospital Act, Chapter H-6.1 .........................252 Appendix E-1: Proportion of Population 65 years+ ....................................................................254 Appendix E-2: Total Provincial Government Expenditures........................................................255

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CHAPTER I: INTRODUCTION AND OVERVIEW

This policy study relates to the intersection of two themes identified as priorities for

health policy research: health system restructuring and home care (National Forum on Health,

1997a). Regionalization was the policy instrument Canadian provincial governments used in

response to a host of economic and structural problems facing health care during the late 1980s

and early 1990s. A key theme of regionalization was emphasizing local control versus central

control to the extent that this meant a change in who made the decisions about health care as

represented by changing the scope of conflict. Proponents of health reform argued that if

segregated budget silos for various health sectors (i.e. home care, hospitals, nursing homes,

mental health, public health) were consolidated under a regional governance and service delivery

structure, an integrated budget or funding mechanism would enable resources to be reallocated.

(Angus, Auer, Cloutier, & Albert, 1995; Hurley, Lomas, & Bhatia, 1993; Hurley, Lomas, &

Bhatia, 1994; Rachlis & Kushner, 1994; Evans & Stoddart, 1986; Evans & Stoddart, 1990;

Decter, 1994; Crichton, Robertson, Gordon, & Farrant, 1995).

Proponents of restructuring health care delivery through regionalization have long

pointed to the desirability of breaking down budget silos which were seen to inhibit the

development of integrated health care delivery (Angus et al., 1995; Hurley, Lomas, & Bhatia,

1993; 1994; Rachlis & Kushner, 1994; Evans & Stoddart, 1986; Evans & Stoddart, 1990; Decter,

1994; Crichton et al., 1995). In the 1980s, Quebec pioneered with regional structures (Desrosiers,

1986; Gosselin, 1984), while the rest of Canada was preoccupied with a series of provincial task

forces and commissions (Angus, 1992). All (including Quebec) recommended shifting the

emphasis away from the delivery of institutional-based acute care to enhancing community-

based care through the use of home care (Angus, 1992; Mhatre & Deber, 1998; Deber, Baker, &

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Mhatre, 1992; Deber, Mhatre, & Baker, 1994). Similarly, a comprehensive program of research

and consultation produced the well-reasoned report of the National Forum on Health (1997a,

1997b) of which one key recommendation was building a more integrated system. In theory,

integrated regional budgets should increase incentives to coordinate care, replace more expensive

institutional care with less costly home care, and use the most appropriate mix of services across

the care continuum, potentially shifting a larger share of resources to home care (Angus et al.,

1995; Lomas, Woods, & Veenstra, 1997; Lomas & Rachlis, 1996; Church & Barker, 1998). The

following quote summarizes the anticipated outcomes of regionalization:

Regionalization was born amid great optimism that it would induce substantial

reallocation. The optimism was based on a diagnosis that the fundamental barrier to reallocating

funds from acute care to community-based programs and non-health care determinants was

funding silos. Regionalization with its associated integrated budgets, would remove this barrier.

Some reallocations have occurred but they have fallen short of expectations. In retrospect this

optimism was unfounded as perhaps should have been obvious when one reflects how difficult

reallocation is within fully integrated, hierarchal organizations much less a regional health

authority with far more muted power (Hurley, 2004, p.38).

Schattschneider (1958, as cited in Kellow 1988, p.715) wrote, “the definition of the

alternatives is the supreme instrument of power...because the definition of alternatives is the

choice of conflicts, and the choice of conflicts allocates power.” Following the passage of the

HIDS in 1957, funding for hospitals has been a cornerstone of Canadian health care. Home care

is a relatively new or nascent health care sector that has a wide variation in the extent to which it

is funded by provincial governments. The home care share of government health spending is

much smaller than hospitals. A salient characteristic of health regions is that it is predicted that

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sectoral budgets will be aggregated into a global or integrated funding envelope. This type of

funding mechanism forces redistributive policy-making and may encourage health actors seeking

to enlarge their share of resources to cannibalize other less powerful actors (in accordance with

scope of conflict theory).

Taken together, these political science theories predict that powerful actors such as

hospitals are more likely to succeed in a regionalized environment than less powerful actors such

as home care. A confounding factor, which must be taken into account if hospital resources are

to be reallocated to home care, is that consumers are more likely to pressure for hospital care

services than for less visible health services such as home care.

The theory of redistributive politics explicates a critical element of integrated, envelope

and global funding in that this type of budget mechanism forces trade-offs. Scope of conflict

theorizes that structural arrangements influence outcomes. Although it has been assumed that

integrated budgets can position regions to reallocate resources from hospitals to home and

community care, it is equally plausible that reallocations could go in the other direction. It is also

valid that budgetary integration may be more theoretical than real if decision makers have pre-

existing institutional arrangements which may influence outcomes by maintaining existing

budgetary shares. Similarly, rules can be introduced to limit the nature, direction, and extent of

change. Such mechanisms taken together can minimize the extent to which less powerful

services such as home care will be cannibalized in the process of allocating resources.

Although integration of funding under a health region is justified on the basis of

rebalancing and strengthening marginalized and less prominent health services such as home

care, public health, and health promotion, political science scope of conflict theory would predict

that funding for these services would be at risk of being cannibalized in order to meet needs of

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more powerful actors, such as hospitals. Rondeau and Deber (1992) analyzed models for

integrating and coordinating health care delivery from organizational and economic perspectives.

One observation about the role of mediating structures such as health regions in integrated

services planning is that organizations with adequate resources (such as hospitals) will resist

efforts to integrate services and will collaborate only to the extent that it is in their interest to do

so. Rondeau and Deber (1992) proposed administrative incentives are necessary to effect change

since organizations naturally tend to preserve and maintain program integrity. In addition, they

suggested all health sectors have contrary and conflicting ideologies where each type of provider

and associated professionals (e.g. hospitals, physicians, and nurses, in contrast to home care and

residential long-term care) each perceives its own expertise as indispensable in the spectrum of

health services. Lastly, they pointed out that historically, health sectors have operated with

segregated budgets and within the current fiscal environment, have put up ‘fences’ to protect

program funding, such that resources were unable to be shifted between programs. Clearly, these

factors present a contrasting viewpoint about the creation of health regions and their capacity to

reallocate resources.

Preliminary analyses of experiments with health regions are described in the Canadian

literature focused on health reform outcomes (Bell, 1994; Carrothers, MacDonald, Horne, Fish,

Silver, 1991; CMA, 1993; Church & Barker, 1998; Rondeau & Deber, 1994; Deber, Mhatre, &

Baker, 1994; Dorland & Davis, 1996; Hollander & Prince, 1992; Hurley, Lomas & Bhatia, 1994;

Lomas & Rachlis, 1996; Lomas et al., 1997c; Reamy, 1995; Denis et al., 1999; Denis,

Contandriopoulos, & Beaulieu, 2004; Tomblin, 2002; Lewis & Kouri, 2004). Internationally, a

number of countries have experimented with regional approaches as one mechanism for allowing

greater attention to comprehensive and holistic service delivery for a defined population, while

5

maintaining sensitivity to local needs (Deber, 1996; Malcolm, 1990; Saltman & Figueras, 1997;

Saltman, Figueras, & Sakellarides, 1998). Much of the Canadian literature is descriptive, which

elucidates organizational structures and governance arrangements, the range and types of health

care administered by health regions, and mechanisms to engage citizens in identifying

community needs. Some literature has specifically concentrated on resource allocation (Eyles,

Brimacombe, Chaulk, Stoddart, Pranger, & Moase 2001a; Eyles, Stoddart, Lavis, Pranger,

Molyneaus-Smith, McMullan, 2001b; Hurley, 2004; Hurley, Lomas, & Bhatia, 1994; Lomas &

Rachlis, 1996). Little attention as yet has been directed to the financial implications of regional

structures on resource allocation and, in particular, the outcomes for home care.

For the time studied in this analysis, all provinces except Ontario have regionalized

health care delivery as the cornerstone of their provincial health reform plans. As of 2008,

Ontario is implementing a variation of regionalization which retains individual boards, but has

one purchaser with a unified budget. In 2005, the Prince Edward Island government disbanded

health regions and ‘recentralized’ health care delivery. During the early 1990s, provincial

governments viewed the formation of health regions as desirable because: program-based or

health care sectoral-based budgetary silos would be collapsed, making it easier to move

resources across sectors i.e. from acute/hospital care to community care; a seamless system of

health care would be created, leading to system-wide planning based on identified community

needs; and efficiencies would be gained as care was moved outside of residential long-term care

institutions and hospitals into homes and communities. These policy goals, while individually

laudable, may not necessarily be compatible in practice (Lomas & Rachlis, 1996). This policy

analysis concentrates on the extent to which resources were actually reallocated using the

example of home care in three Canadian provinces: Prince Edward Island, Nova Scotia, and New

6

Brunswick.

I.1 The Policy Problem, Significance, and Need for the Study

Prince Edward Island, Nova Scotia, and New Brunswick implemented regionalization as

a consequence of a series of provincial task forces and reports (Prince Edward Island Health

Task Force, 1992; Prince Edward Island Health Transition Team, 1993; Nova Scotia Department

of Health, 1990; Nova Scotia Department of Health, 1994; New Brunswick Commission on

Selected Health Care Programs, 1989; New Brunswick Health and Community Services, 1992;

New Brunswick Health and Community Services, 1993). Regionalization required provincial

governments to: 1) determine the size and number of the health regions and which geographical

areas would form the health regions; 2) set up regional administrative and governance structures;

3) decide on which health care services would be assigned for regional administration; 4)

develop institutional arrangements and budget mechanisms for transferring provincial funding

for a pre-determined array of heath care services; and 5) encourage health regions to allocate

these funds in accordance with community needs and provincial guidelines (Lewis & Kouri,

2004). There was variation in how this was accomplished, and how much the provincial

governments attempted to dictate what health regions would do.

Of particular interest in this policy study is: To what extent were resources reallocated to

home care following health restructuring in Prince Edward Island, Nova Scotia, and New

Brunswick? Three different models of regionalization were implemented, with one major

difference being the array of health care services assigned for regional administration and

whether home care was included. Since the three provinces share many similarities, this natural

policy experiment considers the implications of these administrative differences in

responsibilities for health care service delivery.

7

Table 1 illustrates the health services assigned for regional administration by each

province over the time frame of this study. Prince Edward Island’s model incorporated health

care and community-based services including home care; New Brunswick’s model involved only

hospitals and home care, while Nova Scotia’s approach began with only hospitals and then

expanded to include some community programs such as health promotion/public health,

followed by mental health and addiction services. Nova Scotia did not assign home care for

regional administration.

Table 1-1. Overview of regional models implemented in Prince Edward Island, Nova Scotia, and New Brunswick

Included within Regional Health Authority?

Health service/provider

New Brunswick

Nova Scotia

Prince Edward Island

Hospitals

Yes

Yes

Yes

Home care - acute substitution

Yes

No

Yes

Home care - LTC substitution

No

No

Yes

Home care - preventive/maintenance

No

No

Yes

Mental Health

No

Yes

Yes

Public Health/health promotion

No

Yes

Yes

Long-Term residential care

No

No

Yes

Addictions

No

Yes

Yes

Under Canada’s constitution, health care is a provincial responsibility. As a result of variations in

provincial fiscal capacities, the federal government has played a significant role in helping

8

provincial governments to meet the costs of providing comprehensive and universal health care

to their residents. Canadian health care grew incrementally, beginning with federal-provincial

cost-shared programs to insure hospital care (the Hospital Insurance and Diagnostic Services Act

- HIDS, 1957) and physician services (the Medical Care Act, 1966). The 1984 Canada Health

Act (CHA) reaffirmed the language of the earlier legislation, and defined comprehensiveness

only in terms of who delivered care (“practitioners,” usually physicians) and where that care was

delivered (hospitals). In consequence, certain services have been ‘protected’ under the CHA,

while others, particularly home care, are not (Deber et al., 1998; Deber & Baranek, 1998). Note

that in contrast to the UK, these insured services were paid for with public funds, but delivered

privately. More details will be provided in Chapter IV.

I.2 Why Study Home Care in the Context of Regionalization?

Regionalization of health care delivery and resource reallocation were regarded as a

policy instrument that had high potential to make possible a shift of funding for the delivery of

health care away from institutional settings (hospitals, and to some extent, residential long-term

care) to home care, where services were provided in patients= homes and community-based

settings (Church & Barker, 1998). As Church and Barker (1998) stated, “regional structures are

best suited to effect such a shift in the orientation of the health system because they allow

decision-makers to move resources from one program to another without having to deal with

traditional professional and organizational barriers” (p.472). While publicly funded home care

provincial government expenditures have increased since the beginning of health reform in the

early 1990s, it is not clear to what extent regions had an ability to shift resources to home care.

Because the CHA classifies home care as an “extended health care service,” it is not

included in the definition of comprehensiveness. Instead, provincial governments are free to

9

include home care within their provincially funded plans (as all do to some extent), but there are

no federal terms and conditions which must be complied with. Not surprisingly, there is

considerable variation across Canada with regards to eligibility for home care, how it is funded

and how it is delivered. Unlike hospitals and physicians, the lack of national terms and

conditions means that universal access to home care is not guaranteed. As one comprehensive

account of home care services in the provinces and territories recently concluded: “Most

provinces have delegated responsibility for funding allocation and service delivery to regional or

local health authorities. However, in most cases the provincial and territorial departments set

overall policy guidelines and standards for regional service delivery, reporting requirements and

monitoring outcomes” (Health Canada, 1996b).

Where home care has been regionalized, and since home care services are not a medically

necessary insured service, considerable variation may result even within provinces as to the mix

and volume of home care services provided. Some home care advocates are worried that, unless

home care budgets are protected, resources from home care will be diverted to more powerful

actors such as acute care hospitals which already have large budgets that form a large share of

provincial government health spending.

Given the dynamic nature of health reform and the ongoing provincial initiatives vis à vis

health restructuring, in depth cross-case comparisons on the advantages and disadvantages of

approaches to regionalization and decision-making with regards to constructing yearly budgets

should prove of value in assessing whether health reform is achieving its objectives. This in-

depth policy study of a natural policy experiment involving three provincial cases and a

multilevel analysis of provincial and regional expenditure trends, will also provide baseline

information about financial outcomes for home care. In particular, attention is paid to the impact

10

on resource allocation to home care and the extent of resources gained (or lost) by home care

through regionalization, given that a prominent policy goal of health restructuring was the

movement of care into the home and community as the number of beds in hospitals were

rationalized and reduced. Quantitative expenditure data is amplified by qualitative data about

impressions of regional key informants.

I.3 Research Questions

This policy research employs a case study, mixed methods design. The regional

structures implemented by Prince Edward Island, Nova Scotia, and New Brunswick are regarded

as the independent variable for the quantitative aspect of this policy analysis. The outcomes of

interest, or dependent variables, include financial indicators describing resources allocated to

home care. These dependent variables are operationalized as provincial government home care

per capita spending and home care share of government health expenditures. The qualitative

aspect of this research involved using semi-structured interviews to gather impressions of

regional health care leaders about how regionalization has unfolded and supplements the

quantitative data. The time frame for this policy research is 1990/91 through to 2000/01. The

inclusion of home care in the regional structures (operationalized as the array of health care

services assigned for regional administration) varies ‘naturally.’ Both New Brunswick and Prince

Edward Island included home care in their regional models, while Nova Scotia chose to maintain

central government control of this sector. The following research questions guide this policy

analysis.

I.3.1 Provincial Government Home Care Expenditures

What are the provincial expenditure trends for home care? What are the per capita expenditure

trends at the provincial level? Did placing home care under regional administration result in

11

higher per capita spending at the provincial level compared with keeping the administration of

home care centralized? What are the regional expenditure trends for home care? What are the

regional per capita expenditures?

I.3.2 Home Care Share of Government Health Expenditures

What is the home care share of provincial health expenditures? How does the resource allocation

trend for home care compare with the trend for the hospitals? Did putting home care under

regional administration result in a different resource allocation outcome at the provincial level

compared with keeping the administration of home care centralized?

I.3.3 Health reform agenda

What is the rationale and impetus for changing how health services are delivered? What are the

underlying policy goals driving health reform? What were the legislative rules of the game in

relation to the new roles for health regions and the provincial government? How did the health

reform agenda influence the choice and implementation of the regional model implemented by

each province?

I.3.4 Characteristics of Regional Models

What functions and health services were assigned for regional administration? How did each

province treat home care in designing its model of regionalization? What budget and funding

methods were used? How did each province approach the home care budget i.e. to what extent

was the budget “protected” when integrated into regional funding envelopes)? Did protecting the

home care budget make a difference in the amount of resources reallocated? What are the

implications of the distinct regional structures and institutional arrangements for local autonomy

in contrast to central control?

12

I.4 Outline of Dissertation

This dissertation consists of eight chapters. Chapter I has introduced the policy study.

Chapter II describes the theoretical framework for scope of conflict and presents an overview of

regionalization research in the Canadian context and the role it plays as an instrument of health

reform. Chapter III describes the research design and methods used to collect and analyze

quantitative and qualitative data. Chapter IV describes the case of Canada. Chapters V (Prince

Edward Island), VI (Nova Scotia), and VII (New Brunswick) report the findings from the in-

depth case studies about each province. The policy context including various characteristics such

as geographic, demographic, social, economic and political as well as the delivery of health care

prior and following regionalization, were compared. These findings were interpreted using

observations about the implications of each regionalization model gathered from semi-structured

interviews conducted with selected regional key informants. Chapter VIII presents an

interpretation and discussion of individual case findings.

13

CHAPTER II: LITERATURE REVIEW AND THEORETICAL FRAME WORK

The chapter begins by examining the dimensions of a health care system including

financing, delivery, and allocation. Next, the scope of conflict and re-distributive policy-making,

which are the theoretical frameworks underlying this policy analysis, are discussed. Literature

about regionalization is reviewed, with particular focus on its potential as a policy instrument to

reallocate health care funding.

II.1 Dimensions of Health Care Delivery

In analyzing health care systems, three key elements must be distinguished: financing

(who pays for what [health care] services; i.e., the state/public vs. individual/private); delivery

(how services are managed, organized, and provided; i.e., by public or private providers); and

allocation (the incentive structures set up to manage how resources flow from those who fund

services to those who deliver them) (Deber, 1998; Deber 2000; Deber 2002).

II.1.1 Public and Private

The Organization for Economic Co-operation and Development (OECD) identifies four

main types of funding for health services: public payment through taxation/general revenues;

public/quasi-public payment through social insurance; private insurance, and direct out-of-pocket

payments. These differ in the extent to which they involve the pooling of risk across the

population. As will be noted in Chapter IV, Canada uses a mix of 70% public (tax-based) and

30% private funding.

In practice, the distinction between the terms “public” and “private” implies that “public”

can often mean governmental or official, while “private” is often not always clear, and can vary

across sectors. Paul Starr (1989) in his book on the meaning of privatization characterizes private

as what lies beyond the state's boundaries (i.e., in the market or in the family). Saltman and von

14

Otter (1992) noted that “public” may refer to a wide range of structural arrangements

accountable to national, provincial, regional or local level authorities, managed by elected or

appointed administrators. The term public may also include quasi-independent agencies that are

publicly capitalized, but autonomously managed and accountable to public officials only for

long-term outcomes. Deber (2000; 2002) identified ‘public’ as consisting of four levels: federal

(national government); sub-national (state/provincial); regional governments/authorities; and

local governments. ‘Private’ categories include: not-for-profit, voluntary organizations as well as

for-profit, corporately owned and operated organizations which can range from small worker-

owned firms to large, stock-issuing corporations (Deber 2000; Deber, 2002). Although most

literature refers to formal organizations when describing private, Deber (2000, 2002) argues that

individuals and their families who often provide and pay for considerable care for those who are

ill or disabled should be included in this definition.

II.1.2 Delivery

Health care consists of various services and programs including the diagnosis, treatment,

and management of diseases and injuries (both acute and chronic), rehabilitation, prevention and

screening, health promotion and patient education, and public health. Health care can be

delivered by a variety of organizational structures, which mix government-run services, the not-

for-profit sector, the for-profit sector, family, friends or community volunteers, or some

combination of these (Deber, 2000; 2002). These services are often categorized according to the

locations where they are provided such as institutional settings including tertiary and community

hospitals, academic health science centres or nursing homes and community settings including

physician offices, clinics, homes, schools, and workplaces. A variety of providers are involved

including specialist and family practice physicians, nurses, pharmacists, rehabilitation

15

professionals, social workers, health educators, allied health workers, continuing care/personal

and home support workers, and informal caregivers. Health care is often sub-divided into

primary care (the first point of contact), chronic care, public health, and secondary (hospital) and

tertiary/quaternary (specialized/highly specialized hospital) care. Because of contextual

variations across provinces in Canada and indeed internationally, these services may be arranged

in different ways.

As will be noted in Chapters III and IV, CIHI divides the “uses of funds” into: hospitals,

other institutions (which includes long-term care), physicians, other professionals, drugs, capital,

public health, administration, and other health spending (which includes home health care).

Chapter IV will indicate the rules of the game affecting how these categories of services are

funded, and chapters V-VII will give details about hospitals and home care within the context of

health restructuring implemented by Prince Edward Island, Nova Scotia, and New Brunswick in

the mid 1990s.

The ongoing shift in care provision to homes and communities is significant because it

has changed the ‘site’ of where care is delivered (i.e. clients’ homes versus hospitals), but also

because it has resulted in an increasing proportion of care being provided in a policy arena –

community care – that is characterized by a relative lack of legal and regulatory conditions

(Spalding, 2004).

Hospitals are institutions were acute and continuing medical care and supporting

diagnostic and treatment services are provided (CIHI, 2007). Prior to the beginning of the 20th

century, middle and upper class persons were not institutionalized when they became ill, because

the acceptable practice was for families to provide care in the home. Hospitals at that time were

charitable institutions where poor and indigent persons went to be cared for when they were sick

16

or dying. With the introduction of scientifically-based medical training, hospitals were

transformed into modern health care facilities and replaced patients' homes and doctors' offices

as the major location for the treatment of middle and upper class patients as well as for the poor

(Torrance, 1998). Hospitals are licensed or approved by a provincial government.

There are various facilities that provide services for elderly, chronically ill, physically,

or mentally disabled persons who, because of their care needs, must reside there permanently.

These include: nursing homes, homes for aged, supportive housing, or group homes and are

licensed by provincial ministries of health or social services. Depending on the nature of the

condition and the financial status of the resident, the cost of this care can be entirely publicly

funded by a provincial government. Most facilities who provide care for elderly persons however

charge a user fee.

‘Home care,’ in various forms, has always been provided by family and friends. This is

known as informal care or support and this care is unpaid. Development of publicly funded home

care was stimulated by various circumstances including the rise in consumer demand through the

aging in place movement, public policy aimed at deinstitutionalizing mentally challenged

persons, coupled with the need for hospitals to find more efficient ways of operating, through

early discharge following an acute intervention or by diverting admissions through emergency

rooms ad the requirement for ongoing care following discharge from hospital. Provincial

governments in varying degrees, use public funding to pay for home care services which

substitute for acute in-patient care, are an alternative to long term residential care, or augment

informal care provided by family and friends. Publicly funded home care programs provide both

home health care and home support services which include but are not restricted to assessment

and care coordination/case management, nursing, physiotherapy, home support and personal

17

care.

II.1.3 Allocation

The allocation dimension for health care involves mechanisms by which money flows

from the funder of services to the provider of a health care service and the incentives inherent in

each (Deber 2000; Deber, 2002). There are three types of allocation decisions involving funding:

macro-allocation decisions by federal or provincial government where funding to health care

competes with other societal needs (i.e. education, transportation); meso-allocation decisions by

regional health boards which distribute or allocate funding to different health care sectors who

compete for their share of resources (i.e. home care, hospitals, public health, etc.); and micro-

allocation by clinicians and other front-line workers such as home care case managers who

decide which individuals should receive specific services (e.g. who gets the transplant, who

qualifies for home care services).

With respect to the allocation of funding for health care services, Deber et al. (1998)

draw on the work of Saltman and von Otter (1992). They proposed a continuum of models

ranging from centrally planned to pure market models. In a market allocation model (not to be

confused with market-based financing), “money follows the client”, and providers’ receipt of

(public) funding is based on their ability to attract patients/clients. For example, a nursing home

is usually funded based on the number of bed days it provides. In this model, clients can exercise

choice over who provides the health care service. In a centrally planned model, “clients follow

the money” and have little choice about where or who provides the service; resources (public

funding) are allocated to particular organizations to provide certain health care services and

anyone wishing that type of care must go to those organizations. Saltman and von Otter (1992)

argued the market allocation model is the strongest at being responsive to client needs, whereas a

18

centrally planned allocation model tends to be best at controlling total costs. Accordingly, trade-

offs are inevitable.

As will be noted in Chapter IV, the way in which Canada has financed health care has

encouraged the creation of ‘funding silos’. As such, there is a pervasive belief that

regionalization was a better way of organizing and integrating care so that resources could be

reallocated across sectors to improve cost effectiveness of services delivery.

II.2 Regionalization as a Policy Instrument for Provincial Health Care Reform

II.2.1 Defining Regionalization

Despite a sizeable volume of international literature about the

decentralization/regionalization of health care (Hunter et al. 1998; Mills et al., 1990; Malcolm,

1990; Saltman & Figueras, 1997), there is no consensus definition of regionalization in the health

care policy arena (Lewis & Kouri, 2004). According to Tomblin (2002), a major problem with

evaluating regionalization is that as a concept, it has various meanings in different policy

settings, and can be used to defend very different and competing objectives. Some definitions of

regionalization include: “…the rationalization of often diverse and semi autonomous services to

provide comprehensive health care to a large geographic region or group of communities” (Mills

et al., 1990, p.15); “…the allocation of resources and services delivered in relation to a plan that

has a geographic dimension” (Fein in Carrothers et al, 1991, p.6); “…the consolidation/

realignment of functions/positions either geographically or organizationally to streamline and

achieve savings through the elimination of duplicative positions” (Naval District Washington,

2004); and “…contains features that can be defined in context of geography, decentralization,

and rationalization” (Carrothers et al, 1991, p.8). Each of these definitions include at least one or

a combination of the following key concepts which comprises how regionalization is

19

characterized: 1) there is a geographic aspect which unifies planning and service delivery; 2)

there is a consolidation feature; 3) there is a rationalization component; and 4) there is a

realignment of power and authority either through decentralization or re-centralization of

decision-making responsibilities or both. These descriptive elements also ‘line up’ with how

regionalization in the Canadian context has been defined by Lewis and Kouri (2004) which

involves the establishment of an intermediate governing structure at the regional level that

assumes functions previously fulfilled by a central government or local board. For the purpose of

this policy analysis, regionalization is operationally defined as:

A structural reform involving a two-way shift in power relationships where authority for decision-making is devolved from central health ministry actors and is centralized from local actors overseeing hospitals; this change is based on the use of a designated geographical area for planning and funding health care services.

The World Health Organization Observatory defines decentralization as “changing

relations within, and between, a variety of organizational structures/bodies, resulting in the

transfer of authority to plan, make decisions or manage public functions...” and “the transfer of

authority is from higher to lower levels” (2004). One conceptual similarity between

regionalization in the Canadian context and decentralization in the European context is that each

involved a ‘downward’ transfer of authority and power for administrative tasks and duties,

political decision-making, and managerial functions related to health care (Hunter et al., 1998;

Mills et al., 1990; Malcolm, 1990). However, reforms depend on starting points. In many

European countries, delivery was ‘public’, often through a branch of a national ministry of

health. Accordingly, much of the European literature speaks about decentralization and moving

power rather than aspects of service delivery/resource allocation from the centre to local actors.

In Canada, in contrast, delivery used a ‘public contracting’ model, in which public money flowed

20

to private organizations (often not-for-profit) to deliver care. As will be seen in Chapters IV, V,

VI, and VII the Canadian regional examples thus had an additional element not often found in

the European context - the re-centralization of power from local actors (e.g. hospital and

community boards) to regional bodies, coupled with the decentralization of power from the

provincial to the regional level. For that reason, regionalization and decentralization, although

similar, are not synonymous in this policy analysis.

According to Tomblin (2002) regionalization represents a ‘cluster’ of related changes that

has roots in political science (the power shift), economics (efficiency and rationalization),

ideology (citizen engagement, population health), and management/organizational change

(integration, service continuum). These competing perspectives make it difficult to compare the

effects regionalization is designed to produce.

II.2.2 Design Features of Provincial Regionalization Models

There are numerous Canadian studies which describe provincial approaches to

regionalization (Denis et al., 1999; Hurley et al., 1994; Lomas et al., 1997 a,b,c; Lewis & Kouri,

2004; Eyles et al., 2001a,b,c; Lomas & Rachlis, 1996; Church & Barker, 1998; Reamy, 1995;

Dorland & Davis, 1996; OHA, 2002; Marchildon, 2005; Tomblin, 2002, 2004; Touati, Roberge,

Denis, Pineault, & Cazale, 2007). Chapters V-VII describe key characteristics of health regions

for Prince Edward Island, Nova Scotia, and New Brunswick. Key features will include: the

number of tiers implemented (i.e. community health boards in addition to the regional board); the

type of board (elected versus appointed); the decision-making authority (i.e. responsibilities may

include planning, setting priorities, allocating funds, managing services, some service delivery);

the method of funding (historical expenditures versus needs-based); and the array of services

administered. The array of services assigned for regional administration is a distinguishing

21

feature which varies significantly across provinces. The commonality among all provinces was

that outpatient drugs and physician payments were excluded from all regionalization models

(Lomas et al., 1997c’ Lomas, 1997).

Several analytical approaches have also been used to compare and contrast various design

features of regionalized health care delivery organizations (Mills et al., 1990; WHO, 1995;

Ontario Premier’s Council on Health, 1995; Lomas et al., 1997 a,b,c; Hurley et al., 1994). Lomas

et al. (1997c) stated: “Although such structural comparisons are helpful, they fail to capture the

nuances of context that determine the character of devolution in each province (p.372)”.

Accordingly, particular approaches employed by Hurley et al. (1994) and Lomas et al. (1997

a,b,c) were combined to develop a framework with the purpose of disentangling particular

subtleties of provincial models of regionalization and in particular, drawing attention to features

which enhance or detract from the capacity of the model to reallocate resources to home care.

Hurley et al. (1994) outlined three organizational features of regional health organizations

that are central to assessing the potential effectiveness of the model in bringing about change.

These include: 1) What is the scope of activities to be managed under the model? e.g. functions,

planning, management, funding, and breadth of services?, 2) Where in the organizational

structure of provincial models of regionalization is decision-making power located for these

various functions? What power related to what particular activities is located at the central,

regional, or local levels? and, 3) Who constitutes the decision-making authority and are they

elected, appointed, or experts? Is there balance between provider, patient, payer, community, and

employee interests?

In relation to the ‘what’ aspect of regionalization, Lomas et al. (1997 a,b,c) defined this

concept according to the array of health care services assigned to regional health authorities.

22

Their research concluded there are significant structural variations across Canada in the regional

models implemented by provincial governments. Lomas et al. (1997 a,b,c) maintained a

significant difference was the health care sectors assigned for regional administration; and, that

this partly reflected the focus of the main health reform approach and policy goals for each

provincial government. When this analysis was applied, Lomas et al. (1997 a,b,c) noted that the

narrower the array of health care services assigned to the regional model, the more likely that the

principal health reform objective for the province was to improve efficiency, therefore reducing

health care expenditures. Alternatively, Lomas et al. (1997 a,b,c) observed that the broader the

array of health care services assigned to the regional model, the more likely it was that the

province was concerned with moving towards a population health approach. In addition, this

assignment or devolution of a larger number of health care services for regional administration

signaled a province’s interest in increasing integration and coordination of health care delivery.

When the Lomas et al. (1997 a,b,c) framework is applied to particular provincial approaches,

they reported that the Prince Edward Island model was focused on using the determinants of

health as an underlying planning assumption while Saskatchewan’s changes were reported to be

informed and driven by a wellness approach. Lomas et al. (1997 a,b,c) found that New

Brunswick was at the opposite end of the health reform continuum in that it initially only re-

centralized hospitals and later home care was assigned. The underlying goal of aggregating

hospitals under regional hospital corporations was to rationalize services and to decrease the

number of inpatient beds. Depending on the extent of health care services assigned for regional

administration and the provincial reform perspective and particular policy goals, Lomas et al.

(1997 a,b,c) identified three types of tensions that might exist: 1) delegation of power; 2)

providers’ relinquishment of management responsibilities; and 3) local population’s participation

23

in a dual accountability environment.

Church and Barker (1998) described health regions as a meso level or intermediary

administrative and governance body which assumed decision-making roles previously assigned

to either central (macro/provincial level) and local (micro/sub-program/hospital/clinical level)

structures. Regionalization from a provincial health ministry perspective involved the

‘downward’ movement of authority and responsibility for service planning and resource

allocation. Regionalization viewed from a local level or community perspective involved re-

centralization because authority from previously independent and autonomous hospital boards

was consolidated to a meso level regional health authority. Accordingly, this restructuring of

health care delivery was contentious, as many communities viewed the centralization of hospital

governance as stripping away the planning and control of acute care from local communities

(Lomas et al., 1997 a,b,c).

Up until the early 1990s, budgets for various health care services were administered by

different divisions within provincial ministries – they were segregated and located within

program ‘silos’ (Crichton et al., 1995). However, regionalization created a single administrative

entity with responsibility for planning and distributing health care resources for a predetermined

geographic area. As a result, these previously segregated budgets for various health care sectors

were consolidated under a regional health organization which became the administrative

authority responsible for health care (Hurley et al., 1994). These regional actors were responsible

for allocating an integrated regional budget (also referred to as a global budget or regional

funding envelope) to health care providers. The terms integrated budget, global budget or

regional funding envelope share a common definition for this policy analysis and are

conceptualized as: “…as a financial resource [these] consist of the “sum” of previously separate

24

or segregated health services budgets, which are under the control of a health region” (Denis et

al., 1998). In this policy analysis, the terms integrated budget, global budget or regional funding

envelope, are used interchangeably.

An underlying assumption of regionalization was that an integrated budget transferred

from the provincial government to fund the delivery of specified health care services for a

population living in a specified geographic area would be calculated using a needs-based

population health model (Hurley et al., 1994). According to Hurley et al. (1994), some western

Canadian provinces tinkered with this funding approach; the majority however continued to fund

based on historical expenditure patterns (Nestman, 1995).

Proponents of regionalization argued the consolidating sectoral budgets would position

health regions in such a way as to facilitate breaking down or ‘unfreezing’ the traditional budget

silos which had grown from the 1970s (Flood, 1999; Hurley et al. 1994; Denis et al., 1998). As

observed earlier, one expected outcome of regionalization was more efficient allocation of

funding based on local needs and service preferences. Hurley et al. (1994) proposed that once

health regions became familiar with local needs, funding would be reallocated in response to

these newly identified needs (such as home care or health promotion programs). Hurley et al.

(1994) also suggested these resources would come from lower acute care expenses resulting

from bed closures; hence previous funding for acute care would be reallocated to increase

capacity for home care and community-based services Although many health reformers believed

regionalization would result in rational decisions to reallocate resources to the most cost-

effective ways of delivering care such as home care, other theories suggest different possibilities.

II.3 Theoretical Framework: Scope of Conflict and Redistributive Policy-Making

Regionalizing health care delivery and funding decisions forces trade-offs between local

25

control and provincial autonomy (Rondeau & Deber, 1992; Saltman & Figueras, 1998). The

scope of conflict theory hypothesizes about how changing the location of where decisions are

made and the structure of who participates can influence policy outcomes.

II.3.1 Scope of Conflict

Political scientists are concerned about the importance of understanding how policies are

made and who participates in the political process. Schattschneider developed the scope of

conflict theory to explain how individual or group interests at decision-making tables influence

policy outcomes. Scope of conflict refers both to the notion of ‘how’ issues are defined and the

processes and mechanisms used to ‘make’ policy decisions. Schattschneider claimed that

examining the scope of conflict in relation to policy development helps to determine the

outcome. Setting up health regions and deciding which health care services were assigned for

regional administration was a political process. Assigning health regions to determine how health

care funding is allocated was also a political process.

As Schattschneider (1958, as cited in Kellow, 1988, p.715) wrote, “the definition of the

alternatives is the supreme instrument of power...[because] the definition of alternatives is the

choice of conflicts, and the choice of conflicts allocates power.” Since not all interests are equal,

seemingly trivial differences in how decision-making structures are designed can lead to major

differences in policy outcomes (Schattschneider, 1958, as cited in Kellow, 1988). In general,

those groups with ‘concentrated’ (i.e., strong or powerful) interests around a particular issue are

more likely to win than groups whose interests are more ‘diffuse’. In this policy analysis,

differences between hospitals and home care interests are considered since hospitals are an

example of a concentrated interest because of the historical and long standing role they have

played as a key actor in delivering acute health care. They are powerful and represent a relatively

26

large (albeit shrinking) proportion of provincial government health expenditures, are highly

visible and a source of community pride (Tomblin, 2002). In contrast, the home care sector has

been described as both diffuse and relatively weak; home care budgets are a small proportion of

provincial government health expenditures, and unless citizens have cared for an elderly parent,

chronically ill or dying relative, or a disabled child at home, they may not have come in contact

with publicly or state-funded provincial home care programs, and accordingly are unlikely to

advocate on its behalf.

According to Schattschneider (1958, as cited in Kellow, 1988), scope of conflict is

influenced by three factors including: the “visibility” of the policy issue or interest (which is

related to information costs and the ease with which individuals and groups can assess gains and

losses); the “intensity” or attachment to the policy issue/interest; and “direction,” that is, how the

issue/interest relates to other concerns on that group’s policy agenda. A broad scope of conflict

involves numerous stakeholders and can alter the process of decision-making. In relating this

concept to regional health care budgets, scope of conflict would imply that, the broader the array

of health care sectors for which allocation decisions must be made, the more intense the power

struggles among these various interests will be; there will be clear winners and losers based on

the trade-offs made.

Health regions responsible for the planning and administration of an array of health care

services have often been justified by health reformers who argue that amalgamating previously

segregated health care sector budgets under one administrative structure created ‘ideal

conditions. ’ for reallocation of resources amongst health care sectors, given that the instrument

of integrated budgets had the potential to enable boards to rebalance and strengthen formerly

marginalized services such as home care, public health, or health promotion (Lomas & Rachlis,

27

1996; Hurley et al., 1994; Eyles et al., 2001b; Angus et al., 1995; Flood, 1999). Political science,

on the other hand would suggest the home care sectoral budgets may be at risk in order to

safeguard the immediate needs and interests of more powerful actors such as hospitals and

physicians. As will be shown in Chapter IV, home care in Canada, in contrast to hospital and

physician services, is not protected under the CHA (Deber, 1996). The contrasting predictions

about resource reallocation policy outcomes will be tested in this policy analysis by examining

changes in provincial government expenditures for home care and hospitals immediately

preceding and following provincial restructuring of health care.

The implications of the provincial policy choices for regionalization involve a

consideration of how scope of conflict is applied to interpret the policy outcomes for home care,

where different health care services were assigned for regional administration including whether

or not home care was present. Regulatory provisions will also be considered. For example: If

home care was assigned for regional administration in a particular province, what instruments

were put in place to preserve the home care sector’s proportion of provincial government health

expenditures? What processes did the health regions develop to support resource allocation

decision-making? Did regions merely support the status quo or were new allocations made?

What institutional arrangements inhibited or facilitated resource shifts to home care?.

II.3.2 Redistributive Policy-Making

Scope of conflict can also be affected by whether policy-making is distributive or

redistributive (Lowi as described in Kellow, 1988). Distributive policy-making includes the

spending of new or additional money that is added to an existing budget for the purpose of

funding new programs or services. Re-distributive policy-making involves social or economic

policies where there are ultimately winners and losers (i.e., rich versus poor; urban versus rural,

28

etc). Re-distributive policy-making begins with a fixed budget (as in the case of health regions),

and when a decision is made to reallocate funding, one health care sector may gain at the

expense of another since the ‘loser’ fails to keep their share of funding which has been re-

distributed. Although in the final analysis, all resources are limited and all politics are re-

distributive, most forms of public budgeting act to camouflage this need for trade-offs (Angus et

al., 1996). A salient characteristic of funding for health care sectors using integrated budgets,

global or envelope funding is that because the budgets for various health care sectors were

combined through a single administrative structure (i.e. the regional health authority), this type

of decision-making about funding allocation is grounded in re-distributive policy-making; it

encourages those health care sectors that are seeking to enlarge their share of resources to

‘cannibalize’ other less powerful sectors (Deber, 1996; Rondeau & Deber, 1992).

These political science theories predict those health care actors, which by definition have

‘concentrated’ interests (i.e. hospitals), stand to gain more than those actors with less

concentrated interests (i.e. home care) in a regionalized environment. Powerful actors such as

hospitals are more likely to succeed given the combination of resources such as: percentage or

share of provincial health care expenditures they have, power they have developed through

physician alignment, and their high profile and trusted community status. Home care actors have

fewer resources given its low profile, low share of provincial health expenditure and on again off

again relationship with physicians (Barnek, Deber, & Williams, 2004). In the health care arena,

physicians and hospitals are the most powerful actors due to a long funding tradition in providing

health care coupled with the protections they enjoy under the CHA (Tomblin, 2002; Tomblin,

2004). More recently, hospitals and physicians have been joined by certain corporate interests;

for example, international pharmaceutical companies. Given the nascent status of the home care

29

sector, in addition to its low share of provincial health care expenditures and its dispersed

interests, this makes it a less powerful actor (Baranek, Deber & Williams, 2004; Chappell, 1994).

A confounding factor which must be considered if hospital resources are to be reallocated to

home care, is that indeed “consumer” advocates will seem more likely to pressure for acute care

services than home care (Tomblin, 2002). For example, in Nova Scotia in the late 1990s, the

general public became aroused by media stories describing bed closures. In contrast, the pressure

to increase home care services in Nova Scotia has come primarily from those relying on those

services. Similarly, the Canadian media have emphasized the “crisis” in hospital emergency

rooms, with little attention focused on the declining availability of supportive and preventive

home care services, whose absence could have contributed to the pressure on the emergency

rooms in the first place.

The theory of re-distributive politics explicates a critical element of integrated, envelope,

or global funding in that this type of budget mechanism forces an explicit recognition of trade-

offs. Although it has been assumed this form of budget will place health regions in a better

position to transfer resources across sectors; i.e., from hospitals to home and community care, it

is equally plausible that reallocations could go in the other direction. Institutional arrangements

and regulatory structures including guidelines for home care could mitigate the extent of change.

It is also possible that budgetary integration may be more theoretical than real if decision

makers have informal agreements to maintain existing budgetary shares. One of the approaches

provinces have used is to put in place constraints around local control. For example, some health

care sector budgets are protected which include rules to limit the nature, direction, and extent of

change. Such mechanisms can minimize the extent to which the funding of less powerful health

care actors will be cannibalized in the process of allocating resources. Saskatchewan introduced

30

a ‘one way valve’ which prohibited health regions from moving home care resources to

hospitals, while encouraging regions to shift resources away from hospitals towards home and

community-based care.

In relation to this policy analysis, the scope of conflict theory hypothesizes that decision-

making structures can influence policy outcomes; i.e., whether or not funding was allocated to

home care. Regional health organizations were the policy instrument put in place by provincial

governments to undertake this decision-making; for the most part the boards consist of local

citizens appointed by provincial governments (Lomas, 1997). However, in this particular

situation these boards may be faced with dual accountability in that the citizen members were

accountable, 1) to those who appointed them (the provincial government), and 2) to those whom

they represent (the local community). It is plausible to hypothesize that appointed boards may be

more free to act in accordance with government wishes, while elected boards may be more

responsive to community preferences, or more susceptible to being “hijacked” by vocal (and

concentrated) community interests (Lomas & Rachlis, 1996; Lomas et al., 1997a, b, c).

Accordingly, Schattscneider’s scope of conflict theory would predict that whether or not

home care was incorporated into a regional funding envelope will affect the dynamics of

resource allocation decision-making; Lowi’s theory of re-distributive policy-making speculates

that regionalized structures will force policy trade-offs and there will be winners and losers in a

regional health board’s quest to reallocate health care funding. In stark contrast, the health

reform or integrated health services delivery approach, has enjoyed popularity with most

Canadian provincial health reform commissions (Angus et al., 1996; Hurley et al., 1994; Hurley,

2004) and assumed the formation of intermediary organizations that vertically integrated health

care sectors (known as regional health authorities) could bring about changes to where health

31

care was provided, by funding more care in the community and promoting an integrated

approach to health care delivery (Hurley et al., 1994; Lomas, 1997; Angus, 1992; Angus et al.,

1995). The scope of conflict theory focuses on decision-making structures and models which

give rise to power differentials among participants. To the extent that power is related to prior

budgetary allocation, this in turn suggests those health care sectors with a smaller budget (such

as home care), are less powerful than others with a larger budget such as hospitals. The lack of

some form of explicit protection for home care could increase its vulnerability in a global or

integrated budget environment. In contrast, hospitals are powerful actors. An in-depth policy

analysis of these competing theories are explored in Chapter VIII. As a lead up to this cross case

discussion and analysis, the findings of in-depth case studies for Prince Edward Island (Chapter

V), Nova Scotia (Chapter VI), and New Brunswick (Chapter VII) about the implications of

health care restructuring on resources allocation to home care will be described.

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CHAPTER III: RESEARCH FRAMEWORK AND METHODOLOGY

This chapter discusses the research approach for this policy analysis following be a

description of the research design. Research questions, outcome measures, data collection

methods for quantitative and qualitative data, data sources, and how these data were analyzed

and interpreted are presented.

III.1 Research Approach

III.1.1 Natural Policy Experiment

The term experiment is most commonly associated with research laboratories where

experiments are conducted (Babbie, 1975). Experimental design involves the researcher

manipulating both the environment and the subjects and is generally stronger in internal validity

than non-experimental design. It is not always possible to employ an experimental design,

particularly when the researcher is interested in studying a naturally occurring, observable

phenomenon such as a change in public policy (Johnson & Joslyn, 1995). Non-experimental

observation may also be used to test hypotheses in a meaningful fashion and often in a way that

increases the external validity of the results (Johnson & Joslyn, 1995). Accordingly,

many important social scientific experiments occur outside controlled settings, often in the course of normal social events. Sometimes, nature designs and executes experiments that we are able to observe and analyze; sometimes social and political decision makers serve this natural function (Babbie, 1975, p.251).

The provinces of Prince Edward Island, Nova Scotia, and New Brunswick constitute a

‘natural policy experiment’ in that they have similar demographic, geographic economic, social,

and political characteristics as will be described in Chapters V through VII. Each government

implemented a different model of regionalization wherein Prince Edward Island assigned home

care, New Brunswick included only acute care substitution home care (i.e. the Extra-Mural

Program), and Nova Scotia continued with the administration of home care at the provincial

33

level. This policy analysis seeks to evaluate the outcome of these public policy choices from a

resource reallocation perspective. All provinces sought to rationalize hospital beds and

simultaneously move more care into the home and community. This natural experiment allows

us to explore the extent to which the per capita spending and home care share of provincial

government health expenditures changed under these models of regionalization?

III.1.2 Policy Research

Policy research is an example of a non-experimental approach developed by political

scientists to study the effect of an independent variable such as a change in public policy

(Johnson & Joslyn, 1995). Of note is that the researcher has no control over the timing or

application of the public policy being analyzed (Johnson & Joslyn, 1995). Policy research was

described as both “art and craft” by Wildavsky (1980). Walt (1996) defined policy research as an

approach which incorporates the interaction among contextual factors (i.e. social, economic, and

political) processes and substantive policy content, as well as the influences of individual and

group actors:

What policy analysis offers is an overview of a particular policy, and by taking account of the context, actors, process as well as content, allows policy makers to evaluate the outcome of policy, but also to identify the circumstances which influenced that outcome, and therefore what steps might need to be taken to change policy (Walt, 1996, p.233).

Given the nature of the research question as outlined in Chapter I, this policy research is limited

to a detailed examination of case studies on three Canadian provinces. It is focused on the

implications of including the home care sector (or not) in a regional model of health care

delivery implemented by the governments of Prince Edward Island, Nova Scotia, and New

Brunswick. Of interest is the extent of change in the home care share of provincial government

health expenditures following the implementation of the regionalization models unique to each

34

province. The public policy decisions taken by the provinces of Prince Edward Island, Nova

Scotia, and New Brunswick in the early 1990s regionalized the administration and delivery of

health care based on geographically defined population clusters. Whether or not home care was

present or absent in the models is considered as the independent variable. The outcomes of

interest include describing resource allocation to home care prior to, throughout, and following

restructuring which is operationalized by tracking the sectoral share or proportion of provincial

government health expenditures allocated to home care and the per capita home care

expenditures.

III.2 Research Design

III.2.1 Case Study

This policy research employs a case study, mixed methods design. According to Johnson

and Joslyn (1995), this particular non-experimental design is helpful for understanding the

implementation of public policies and to gather in-depth information about these policies. A case

study design is guided by empirical enquiry in which a contemporary phenomenon is

investigated within its real-life context (Yin, 2003). Typically, a number of data collection

methods are used such as interviews, document review, and observation. A case study design is

recognized as a distinctive form of empirical inquiry, particularly when public policies are being

evaluated, where explanations are developed, and theories of political phenomena are tested

(Johnson & Joslyn, 1995; Yin, 2003).

Yin (2003) argues that the use of a case study design is appropriate in settings where: 1) a

contemporary phenomenon is being investigated within its real-life context; 2) when it is not

easy to separate the boundaries between phenomena and the context; and 3) when there are

multiple sources of evidence used. A case study design is most appropriately used to answer

35

“how” and “why” questions; these types of questions are directed at explaining events such as

how the differences in regionalization models have implications for home care resource

allocation. Case study design differs from an experimental approach in that the researcher is

unable to assign subjects or cases to intervention and control groups; or manipulate variables; or

control the context or environment of a study as in the case of a laboratory experiment. Despite

these characteristics, Yin (2003, as cited in Johnson & Joslyn, 1995, p.144) asserts “the

researcher can, through careful selection of a case or cases, achieve a quasi-experimental

situation.”

III.2.2 Comparative Case Studies

Designing an empirical study to analyze the implications of a specific public policy

decisions raises some important considerations for the researcher in relation to research approach

and methods (Harrison, 2001). “A key consideration for policy researchers is that they are unable

to manipulate the policy or its implementation in a way that would allow the use of experimental

designs” (Harrison, 2001, p.93). Accordingly, policy researchers must employ other means of

establishing validity, assigning attribution, and identifying counterfactuals (Harrison, 2001).

Comparative case studies are seen as one means to this end. The adequacy of controls provided

by a comparative case study design will depend on what cases are available and how the

researcher can assemble them into meaningful comparisons (Harrison, 2001). Two types of

comparisons can take place based on whether the public policy under consideration (i.e. the

independent variable) was universally implemented or not,

If the policy intervention to be evaluated was universally implemented, the comparisons can focus on different contexts of implementation such as rural and urban, large with small or client group with client group. However, if the policy intervention has not been universally implemented the possibility arises for between case comparisons where cases of implementation are compared with cases of non-implementation or of differential forms of implementation (Harrison, 2001, p.102).

36

A case study with more than a single case is known as comparative or multiple case study

design. This design is “likely to have more explanatory power than a single case study design”

(Johnson & Joslyn, 1995p.146). Multiple cases are not thought of in the same way as sampling

or using a statistical procedure; rather, cases are chosen for the presence/absence of factors that

are deemed to be important (Johnson & Joslyn, 1995). For this policy research, the

regionalization model implemented by each government consisted of two key distinguishing

features or variables of interest which were: whether home care was included and the breadth or

array of health services assigned for regional administration. The provinces of Prince Edward

Island and New Brunswick assigned home care for regional administration. In Prince Edward

Island the regional basket of services was very comprehensive and broad, while in New

Brunswick the array of services was narrow. Nova Scotia did not assign home care to regions

and the array of services was mid range. .

III.2.3 Selection of Cases

This research focused on comparable cases defined as: “cases that a) are matched on

many variables that are not central to the study, thus in effect controlling for these variables; and

b) differ in terms of the key variables that are the focus of analysis, thereby allowing a more

adequate assessment of their influence” (Yin, 2003; Collier, 1993). The researcher’s attention to

selecting cases acts as a partial substitute for statistical or experimental control. In this policy

research the provinces of Prince Edward Island, Nova Scotia and New Brunswick share similar

characteristics which are not central to the study such as: they are geographically located in the

east of Canada; have provincial deficits and accumulated debt; have similar patterns of

provincial government health spending; have declining overall populations, with an increasing

37

proportion of people over 65 years; there are high incidences of chronic diseases; and all face the

challenge of providing access to health care in rural areas as people exit to urban areas. By

choosing to study cases with similar characteristics, factors which may influence the dependent

variable of resource allocation to home care can be controlled for to the extent that is possible in

a natural policy experiment.

Table 3-1 illustrates the comparative framework to select cases where the regional

models are shown according to whether home care was included or not. The province is the level

of analysis; however, the health regions in each provincial case are subunits of analysis, or

‘nested cases’. Within each provincial case, several health regions (based on population size, e.g.

large and small) were selected for in-depth analysis which included semi-structured interviews

conducted with senior health care leaders in the health regions. The purpose was to enhance the

researcher’s understanding of the institutional arrangements in each province, the implications of

these, and how they affected the ability of the health regions to allocate resources to health

sectors. Secondarily, these interviews were used as a research strategy to ‘triangulate’ secondary

data sources for all provinces, which included: 1) provincial government expenditure data for

home care and hospitals and 2) data describing the policy goals, beliefs, ideas, and ideologies

underpinning health reform in each province.

Table 3-1: Two dimensional controls through comparative case studies

Environmental comparison Policy comparison Urban Rural

Policy adopted (i.e. home care assigned to regions) PEI (n=4 interviews) NB (n=6 interviews)

NB: 2 regions PEI: 1 region n=6 interviews

NB: 1 region PEI: 1 region n=4 interviews

Policy not adopted (i.e. home care not assigned NS (n=5 interviews)

NS: 2 regions n=3

NS: 2 regions n=2

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III.2.4 Policy Context

Implementing regionalization as public policy happened within a particular context for

each province. Harrison (2001) contended that the nature of relevant context varies with each

policy field. For health policy, context is likely to include considerations about changing

political, social and economic climates, demographics, and contemporary technological

developments including health care delivery. These considerations were incorporated into a

template ( Appendix A-1) which provided a framework in which to systematically collect data

about the policy context in each province. This framework also was used to describe these

findings for each province ( Chapters V, VI, VII).

III.2.5 Trends Over Time Analysis

Researchers often combine several research strategies so that the weaknesses of one

method can be overcome by the strengths of another (Johnson & Joslyn, 1995). In this policy

analysis the case study is the primary research design. This approach was strengthened by using

more than one case coupled with the use of time. According to Johnson & Joslyn (1995), a time

series design is one way of assessing the extent of change in the dependent variable (i.e. per

capita spending, and home care share of provincial government health expenditures) that may be

associated with the independent variable (i.e. the inclusion of home care in the regionalization

model).

In operationalizing this time series design, numerous measures of the dependent variable

were taken before the introduction of regionalization. This approach enables policy researchers,

To establish trends in the dependent variable that are presumably unaffected by the independent variable so that appropriate conclusions can be drawn about post-policy intervention measures. After the “pre-test” trends are established, the researcher observes the independent variable and then makes several more measurements of the dependent variable after the independent variable has occurred (Johnson & Joslyn, 1995, p.139).

39

In this policy analysis, provincial government expenditure data for home care and hospitals were

collected beginning in 1990-1991, which was several years prior to the implementation of

regionalization. Johnson & Joslyn (1995) indicated that the results of a time series design can be

further improved if the researcher is able to identify comparator cases and control cases to

produce a time series of measurements of the dependent variable for each group.

III.2.6 Mixed Methods - Combining Qualitative and Quantitative Data

Three approaches to multi-method research combining qualitative and quantitative data

are outlined by Hammersley (as cited in Dixon-Woods et al.,2004, p.2). They include: 1)

“triangulation, in which the aim is corroboration (one method is used to verify the findings of

another); 2) facilitation, in which one strategy facilitates or ‘assists’ the other; and 3)

complementarity, in which two strategies are employed to investigate different aspects of a

problem”. In this policy research a multi-method approach was used to study the dependent

variable of resource allocation to home care, i.e. the share of provincial government health

expenditures allocated to the home care sector over a eleven year time frame. In addition to

triangulating the type of data (i.e. quantitative and qualitative), this policy research also

triangulated the sources of data; i.e. public documents, the National Health Expenditure data

aseembeled by CIHI in addition to provincial government expenditure data specific to home

care, and face-to-face, semi-structured interviews with regional key informants (who were

‘elites’ i.e. Chief Executive Officers and Vice Presidents). This approach, where one source of

data (i.e. qualitative interviews) is used to elaborate or illuminate the findings of another source

(i.e. quantitative expenditure data) strengthens policy research (1999).

40

III.2.7 Study Time Frame

The time frame for this study spans an eleven year period from, 1990/91 through 2000/01

and was chosen for several reasons. First, sufficient time would have elapsed since the

implementation of the regional models (Prince Edward Island in 1994; Nova Scotia in 1997; and

New Brunswick in 1992) to study policy outcomes. Second, there was stability in the design of

the regional models over this time period. Accordingly, the configuration or the number of health

regions did not change between 1990/91 and 2000/01 and relatively few adjustments were made

to the services assigned for administration by the health regions. The one exception was in New

Brunswick, where the Extra-Mural Program was assigned for regional administration in 1996.

III.3 Data Collection

The rationale for combining qualitative and quantitative data in this policy research was

to qualify and integrate the provincial government home care expenditure findings compiled

during phase one with impressions of regional key informants gathered during phase two. This

judicious combination of qualitative and quantitative methods is recommended as a way to

strengthen policy research and “enable researchers to make more subtle and sophisticated

analyses” (Barbour, 1999, p. 40).

III.3.1 Phase One - Quantitative Data

Data were compiled for annual provincial government spending on home care, hospitals,

and total health between 1990/91 and 2000/01 as well as total provincial government health

expenditures. Where available, regional health care expenditure data was collected for home

care. Expenditure data sources included: 1) two special studies where home care data was

purposively collected by CIHI (Ballinger, Zhang, & Hicks, 2001; CIHI, 2007); 2) a special report

by CIHI describing provincial government health expenditures by fiscal year (CIHI, 2004); 3)

41

expenditure data collected from provincial public documents including the Ministry Annual

reports (New Brunswick and Prince Edward Island), Audited Financial Statements for Health

Regions (Prince Edward Island) and through personal contact with home care program

administrators in all three provinces.

Phase one also included assembling data which described the policy context for various

characteristics used to compare the three cases (Appendix A-1). Table 3-2 lists these along with

the data sources.

Table 3-2: The policy context: comparative indicators

Indicator Data Source

Provincial Government Health Expenditures

CIHI (2004)

Annual Percentage Change in Provincial Government Health Expenditures

CIHI (2004)

Per Capita Provincial Government Health Expenditures

CIHI (2004)

Health Expenditure as Proportion of Total Government Expenditures

CIHI (2004)

Health Expenditure as Proportion of Provincial GDP

CIHI (2004)

Provincial Population CIHI (2003)

Proportion of Population 65 years+ CIHI (2003)

Unemployment Rate CIHI (2003)

Health Status

CIHI (2002); CIHI (2003); CIHI (2004) CIHI (2005)

Total Government Spending CIHI (2003)

Acute Care Statistics www.cihi.ca/cihiweb/en/media_19nov2003_tab1_e.html; tab2_e.html;tab3_e.html;tab4_html;

Home Care Statistics Prince Edward Island Department of Health and Social Services Nova Scotia Department of Health Home Care Nova Scotia New Brunswick Health and Community Services

42

Financial outcomes for this policy analysis are listed in Table 3-3 along with the data

sources. Two financial outcomes central to the study were observed over a eleven year time

period: 1) per capita home care provincial government expenditures (at provincial and regional

levels) and 2) the share of provincial government health expenditures allocated to home care

(which was compared with the hospital sector).

Table 3-3: Financial indicators for provincial government home care and hospital spending

Financial Indicator Data Source cross reference with Charts

Provincial Government Home Care Expenditures

Ballinger, et al.(2001)

CIHI (2007)

Annual Percent Change in Home Care Expenditures

Ballinger, et al.(2001)

CIHI (2007)

Per Capita Home Care Expenditures Ballinger, et al.(2001)

CIHI (2007)

Computed Home Care Share of Provincial Government Health Expenditures

Ballinger, et al.(2001) CIHI (2007)

Per Capita Hospital Expenditures Ballinger, et al.(2001) CIHI (2004)

Hospital Share of Provincial Health Government Health Expenditures

CIHI (2004)

Regional Home Care Expenditures Prince Edward Island Regional Health Authority Audited Statements

Nova Scotia Department of Health Home Care Nova Scotia New Brunswick Annual Report for Health and Community Services New Brunswick Health and Community Services. Approved Hospitals - Annual Report of Financial Services

Computed Per Capita Regional Home Care Expenditures

Prince Edward Island Regional Health Authority Audited Statements

43

Nova Scotia Department of Health Home Care Nova Scotia New Brunswick Annual Report for Health and Community Services New Brunswick Health and Community Services. Approved Hospitals - Annual Report of Financial Services

III. 3.2 Analysis of Quantitative Data - Expenditure Data

The distinctions within publicly funded home care programs as to how home care can

present challenges in collecting expenditure data. This is complicated by the definition of home

care used by CIHI is confined to at this point only including professional home health services as

that is what Canada is required to report on to Organization for Economic Co-operation and

Development (OECD). Prior to 2000, CIHI had not routinely collected home care data in the

same manner as they do for other types of health sector expenditures which they do so by use of

funds as will be described in Chapter IV. Currently home care expenditure data is assigned by

CIHI to the use of funds or sectoral category known as other health spending (2007) which also

includes provincial government spending on health research and health technology as will be

described in more detail in Chapter IV. Given the federal government’s interest in home care

since 2000, a CIHI feasibility study identifying the data dilemmas vis a vis home care was

completed by Ballinger, et al. (2001). Until a more recent report released by CIHI (2007) it was

the most comprehensive source of provincial government home care expenditure data at the time

this research was undertaken. Most of the provincial government expenditure data for home care

was extracted from this report and supplemented with data from the 2007 CIHI report on home

care. CIHI does not routinely collect regional level home care expenditure data so these data

were obtained from Ministry program administrators. Complementary CIHI reports were also

44

used (Tables 3-2 and 3-3).

Policy studies focused on home care are complicated by how provinces define, fund, and

deliver publicly funded home care since each there are inter-provincial variations. Some of these

inter-provincial differences had implications for this policy analysis. For example, in New

Brunswick, not all components of home care as defined by Health Canada in Chapter II were

assigned to the New Brunswick health regions (Chapter VI provides more details). The Extra-

Mural Program providing acute care substitution home care services was; however, chronic and

preventive/maintenance home care continued to be centrally administered by the New Brunswick

Ministry. Nevertheless despite this separation of delivery, the CIHI expenditure data used for

provincial government home care included expenditures for both EMP and chronic, although the

majority of funding is for the EMP component (CIHI, 2007). This separation did not apply in

Prince Edward Island and Nova Scotia. Accordingly, the provincial government home care

expenditure data for Nova Scotia and Prince Edward Island does include both acute, chronic, and

maintenance home care. .

Provincial government expenditure data were collected in current dollars. Selected

financial outcome indicators for home care including total spending and per capita expenditures

were converted to constant dollars using the following conversion table. The home care share of

provincial government health spending was determined using current dollars.

Table 3-4: Conversion of current to constant dollars

Year Current Constant Adjuster Formula 1990 2203.2 2519.7 0.87439 1.143655 1991 2364.8 2590.2 0.91298 1.095315 1992 2458.8 2612.3 0.94124 1.062429 1993 2492.8 2604.8 0.957002 1.044929 1994 2518.1 2592.3 0.971377 1.029467 1995 2525.6 2574.9 0.980854 1.01952 1996 2520.8 2555.9 0.986267 1.013924

45

1997 2630.6 2630.6 1 1 1998 2783.9 2743.7 1.014652 0.98556 1999 2964.3 2870.3 1.032749 0.968289 2000 3201.8 2991 1.070478 0.934162 2001 3451.3 3157.6 1.093014 0.914902

The financial indicators listed in Table 3-2 were compiled in excel files and were used to

generate trend charts by province and across cases. In some instances Canadian level data about

government health expenditures were included to facilitate comparisons. Mapping of key policy

and political events with the provincial government expenditure data displayed in the Figures in

Chapters V. VI, VII and VIII can assist in interpreting these policy findings.

III.3.3 Phase Two – Qualitative Data

Phase two involved collection of qualitative data from face-to-face interviews conducted

with regional key informants. The purpose of the face-to-face interviews was to gain an

understanding of: 1) the benefits and drawbacks of using integrated or global budgets to

reallocate resources; 2) the implications of regional structures; and 3) provincial institutional

arrangements that were put in place or evolved following health restructuring. An interview

guide (Appendix A-2) was constructed based on the literature reviewed in Chapter II.

Regional key informants from the three provinces were recruited with the assistance of a

Regional Director, Canadian College of Health Service Executives. Regional key informants

included the CEOs and Vice-Presidents of selected health regions in each province, whose

portfolio included home care. Table 3-1 outlined the framework used to select health regions for

these interviews. The regions with the highest and lowest per capital home care expenditures

were selected, ensuring rural and urban representation, The Regional Director made an initial

phone call to solicit interest and a ‘Study Fact Sheet’ was distributed (Appendix A-3). If those

contacted expressed an interest in participating in the study, the name was passed on to the

46

researcher.

Fifteen interviews of approximately one and a half hours were conducted. Prior to the

beginning of the interview a consent form was signed (Appendix A-4). All but one of the study

participants agreed to a tape-recorded interview. The interviews were transcribed. The

transcriptions were reviewed and the responses in accordance with pre-selected themes were

extracted by a researcher ( Appendix A-5). These were used in each case study to illustrate the

implications of various aspects of regionalization for resource allocation to home care.

Phase two also involved a document review which included an examination of relevant

provincial health reform policy and planning document. These were supplemented with grey

literature and empirical research and published papers about regionalization in all or one of the

provinces. Data was extracted about health reform goals, planning principles, rationale, and

features of the provincial regionalization models (Appendix A-6). When combined with the

provincial government expenditure data, the regional key informant impressions and data from

the document review were used to interpret how these findings aligned with the theoretical

framework for this policy research.

III.4 Analysis of Case Findings

Whether home care was assigned for regional administration (as in Prince Edward Island

and New Brunswick, but not in Nova Scotia) is what connects the theoretical and analytical

frameworks for this study. Understanding the implications of regionalization as a policy

instrument to redistribute health care resources from acute care to home care is the focus. The

provinces of Prince Edward Island, Nova Scotia, and New Brunswick share many contextual

similarities, with variation among the regional models being whether home care was present or

absent. The inclusion of home care in the regional model, coupled with particular institutional

47

arrangements unique to each province, are hypothesized as being influential in measuring the

extent to which the home care sector increased its share or proportion of provincial and regional

health care expenditures.

III.4.1 Analytical Framework to Compare Regional Models

Various taxonomies and approaches are used which compare and contrast the design

features of regionalization and decentralization (Mills, et al. 1990; WHO, 1995; Ontario

Premier’s Council on Health, Well-being, and Social Justice, 1995; Lomas et al., 1997).

Canadian accounts of research assessing provincial approaches to regionalization in the

Canadian context (Denis et al., 1999; Hurley et al., 1994; Lomas et al., 1997 a,b,c; Lewis &

Kouri, 2004; Eyles et al., 2001; Lomas & Rachlis, 1996; Church & Barker, 1998) are also used.

Taken together, the concepts from this literature were consolidated in a template (Appendix A-7)

to guide the analysis of the case findings. Chapter VIII summarizes and compares the findings

for the three cases.

III.4.2 Analysis of Case Findings and Cross Case Comparison

Chapters V (Prince Edward Island), VI (Nova Scotia), and VII (New Brunswick) offer in-

depth results for each provincial case. These chapters begin with an overview of the context in

which regionalization took place. Various factors such as demographics and geography, size of

elderly population, socio-economic and political features, provincial government spending,

average personal income, unemployment rates, and health status are presented. Prominent

features about funding, delivery, and allocation of health care for each province before and

following the introduction of health reform are described. This is followed by the particular

provincial government’s ideas about health reform, policy goals for regionalization, and the

legislation underpinning health restructuring. An in-depth description and analysis of the

48

regional model implemented by each provincial government is provided, emphasizing particular

institutional arrangements and roles of key policy actors such as the minister, ministry, and

health regions. Next, provincial government expenditure data for home care, hospitals, and

overall health expenditures are presented in Figures. These findings are interpreted using

observations gathered from semi-structured interviews with selected regional key informants.

Chapter IV presents the case of Canada which is followed by the provincial case studies

(Chapters V, VI, VII).

49

CHAPTER IV: THE CASE OF CANADA

Elements of Canadian health care financing and delivery are described in this chapter. In

particular more emphasis is given to home care since the focus of this policy analysis is to

evaluate the extent to which provincial government restructuring of health care delivery and

planning shifted public funding to deliver more home and community-based services. The

rational and impetus for Canadian health care reform is highlighted, and the implications for

resource allocation and local autonomy versus central control are discussed.

IV.1 Canada: The Rules of the Game

IV.1.1 Federalism

Under the Canadian constitution, health care is a provincial responsibility. The division

of power was spelled out in the British North America Act, 1867 (renamed the Constitution Act

in 1982). Because of the imbalance of fiscal capacity across provinces, the federal government

provides funds as long as provincial insurance plans comply with the national terms and

conditions in the Canada Health Act ( CHA). The five funding conditions are public

administration, comprehensiveness, universality, portability and accessibility (CHA, 1984). The

main problem is that insured services which are described under the comprehensiveness

provision of the CHA are defined in terms of who provides (physicians) and where (hospitals)

medically necessary care (Shah, 1998). Accordingly, home care is not included in this section

which has resulted in much inter-provincial variation.

IV.1.2 Policy Dilemmas Associated with the Canada Health Act

Deber et al. (1998) noted that within health care, certain programs are considered "merit

goods", in that they are provided to everyone deemed to need them, regardless of ability to pay.

As it has been pointed out by many economists, market forces are not effective mechanisms for

50

controlling costs if people cannot be priced out of the market. For such goods, multi-source

funding serves to raise total costs, since there is a floor price (what government is willing to

pay), but no ceiling price. A public/private mix for necessary health care services does not

promote efficiency or cost containment, but shifts costs either to consumers directly or to other

insurers (and therefore to employers, who pay for most private insurance, and to their employees,

who often pay for such coverage in foregone wages). In the long run, the total costs to society

may stay the same or even increase if a shift occurs to more expensive programs (e.g., if

foregone preventive care leads to emergency room visits), or if providers are allowed to inflate

charges to those able to pay. In turn, those who cannot afford necessary services, end up doing

without, often with adverse health implications.

This concept has not been applied to home care. The CHA uses these concepts when it

defines insured services for hospital and doctors but not for home care. This is a massive

problem when trying to design a rational system when in fact hospitals and physicians are

privilege over home care. The underlining logic applied to hospitals and physicians has not been

applied to home care. Public funding allocated to home care is entangled with the determination

of which, if any, home and community care services are deemed to be "merit" or public goods.

Provincial governments across Canada finance home care from general revenues resulting in

inter-provincial variation in the range or type of home care services funded as well as provinces

impose limitations on eligibility (since home care unlike hospitals, does not have to be

universally accessible

IV.1.3 Financing

In the Canadian context, financing refers to the sources and methods by which money is

collected to pay for health care (Deber, 2002). These include an array of taxes and premiums

51

collected from individuals and corporations by governments, insurers, and providers. The CHA

requires provincial health insurance plans to comply with five conditions: universality,

comprehensiveness, accessibility, portability and public administration in order to receive cash

transfers from the federal government (Deber, 2002). In effect, universal access for all necessary

insured services delivered to insured persons is required. Insured services, however, are defined

in terms of where they are delivered (hospitals) and by whom (physicians) in order to receive

cash transfers from the federal government (Deber, 2002). Accordingly, full comprehensive

coverage of even medically necessary care is not required once care shifts outside of hospitals

and is delivered by providers other than physicians (Deber & Williams, 1995; Hollander, Deber,

Williams & Flood, 2000). While provinces may choose to publicly fund home care programs and

community care services, they have no formal obligation to do so under current federal-

provincial funding arrangements; i.e., the Canada Health and Social Transfer (CHST). Federal

transfers now under the CHST are no longer tied to specific services as they were under the

previous funding arrangements of the Established Program Financing (EPF) and the Canada

Assistance Plan (CAP). Currently, these federal cash transfers go directly into provincial

government revenues. On the one hand, this global funding arrangement gives provinces the

freedom to restructure their health systems in innovative ways, to integrate services, and to shift

funding toward goals such as health promotion and population health. On the other hand, it

permits extensive variation across Canada in: the range of health services (such as home care,

residential long-term care/nursing homes or public health) which may be publicly funded, the

eligibility for home care services, and the extent to which service entitlements are portable even

within provinces (Deber, 2002).

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IV.2. Structure of Canadian Health Care

IV.2.1 Sources of Financing

The Canadian Institute for Health Information (CIHI, 2007) is the national agency

responsible for compiling information on Canadian health spending. CIHI divides the source of

total health expenditures into financing from the public sector (70% in 2007- check ) and the

private sector (30% - 2007). Public sector financing is in turn sub-divided into various sources:

provincial/territorial funding (91.6%); federal direct which is predominantly to pay for services

to veterans, the military, and prisons (5.3%); social security funds, which includes workers

compensation and a portion of the Quebec Drug Insurance Fund (2.0%); and municipal

governments, largely homes for the aged and public health (1.1%) (CIHI, 2007). Private sector

financing is in turn subdivided into various sources: household out of pocket, expenditures made

by individuals (48.2%); private health insurance (40.9%); and non-consumption, which refers to

hospital non-patient revenue, capital expenditures for privately owned facilities, health research

(10.9%) (CIHI, 2007).

The ‘public’ sector share of expenditures has been continuing on a downward trend, from

74.6% in 1991 to 70% in 1999, with virtually all cost increases arising from private sector

spending (CIHI, 2000). In 1999, almost 30% of total health care costs were paid for privately

through out-of-pocket spending or private insurance Deber & Williams, 1995; Hollander, Deber,

Williams & Flood, 2000; Williams & Barnsley et al., 1999; Williams, Deber, Gildiner &

Baranek, 1999). According to CIHI (2000), the extent of public financing differs considerably

according to what sorts of health care services are covered.

IV.2.2 Health Care Delivery and Uses of Funds

CIHI (2007) has defined how public sector funding transferred by the provinces to health

53

care providers is used in accordance with the following definition for these categories or “uses of

funds”. These use of funds dictate how the provincial government funding for health care is

used in accordance with the following categories: hospitals, other institutions, physicians, other

professionals, drugs, capital, public health, administration, other health spending. The use of

fund categories are explained in the following sections. As illustrated in Appendix A-8, CIHI

annually reports on the spending for these categories for each province and nationally. National

health expenditures are reported based on the principle of responsibility for payment rather than

on the source of the funds (CIHI, 2007).

IV.2.2.1 Hospitals

Within Canadian health care, almost all delivery of medically necessary care is already

private (Deber, 2002). Although Canadian hospitals are often referred to as ‘public hospitals’

they are indeed private, not-for-profit institutions because the employees do not work for the

provincial government and would not be classified as civil servants (which is one way of

defining public delivery). Instead, Canadian hospital employees report through management to

an independent board which governs the hospital (Deber, 2000). CIHI (2007) defines hospitals

as:

Institutions where patients are accommodated on basis of medical need and are provided with continuing medical care and supporting diagnostic and therapeutic services. Hospitals are licensed or approved as hospitals by provincial/territorial government or operated by the government of Canada and include those providing acute care, extended or chronic care, rehabilitation and convalescent care, psychiatric care as well as nursing stations or outpost hospitals (p.61).

IV.2.2.2 Other Institutions

In most jurisdictions, some public funding is available to pay for those who are assessed

as qualifying for this type of long term or continuing care. Otherwise, private, out of pocket

54

funding is used to pay for this care. In the case of those who can afford it, there are various

options for long term care. Long term care residential care can be delivered by a publicly owned

institution (i.e., by a municipal or provincial government) and by a privately owned facility

(which can be either not-for-profit or for-profit). Not-for-profit and publicly owned facilities are

usually governed by advisory boards. Private paying residents (or those who can afford to pay

this portion of the care costs) are charged a user fee which covers the cost of the non-health

component of long term care services available in nursing homes or other types of long term care

residential facilities. CIHI (2007) reports expenditure for residential care types of facilities (for

the chronically ill or disabled who reside at the institution more or less permanently) and which

are approved, funded, or licensed by provincial or territorial departments of health and/or

social services. Residential care facilities include homes for the aged (including nursing

homes), facilities for persons with physical disabilities, developmental delays, psychiatric

disabilities, alcohol and drug problems, and facilities for emotionally disturbed children.

Facilities solely of a custodial or domiciliary nature and facilities for transients or delinquents are

excluded.

IV.2.2.3 Physicians

Family physicians largely deliver primary health care throughout Canada. They are the

initial contact for publicly funded health care and they control access to specialist physicians,

diagnostics, treatment, prescription drug therapies, as well as admission to a hospital if they have

admitting privileges. Canadian physicians operate private practices and physicians as a subsector

are include in the definition of medically necessary care as specified in the terms and conditions

under the Canada Health Act (CHA). Once physicians are certified for practice, they apply for a

billing number from the provincial insurance plan which is administered by the Health

55

ministries. Private practitioners are generally paid for on a fee for service basis and submit

billing claims directly to a province’s medical insurance plan for payment. Physicians can also

be paid through a salary or remunerated through alternate payment schemes. Patients can choose

a physician, however, this is often limited by supply and many provinces currently suffer from a

shortage of physicians in rural and remote areas. Physician expenditures reported by CIHI (2007)

include professional fees paid by public funds through provincial medical insurance plans to

physicians in private practice. This category does not include the remuneration of physicians

who are paid by hospitals or public sector agencies as these expenditures are reported in the

hospitals or other health spending.

IV.2.2.4 Drugs

In-hospital drugs are included in the CHA terms and conditions. Out of hospital drugs are

not included and there is variability in what the provinces cover. This sector consists of a

multiple payer approach including private insurance and out of pocket funding being employed

to purchase drugs in addition to public funding through the provincial drug benefit plans. Drug

coverage which is publicly funded is for special populations such as senior citizens and those on

social assistance. The types of drugs available through provincial drug benefit plans are limited

and provincial formularies list these drugs; formularies are managed by program administrators

located in the provincial health ministries. These formularies are restrictive and emphasize the

use of generic products as one way of controlling ever rising drug costs. Prescribing of drugs is

limited to physicians, dentists and nurse practitioners. CIHI (2007) reports on expenditures for

prescribed and non-prescribed products. The drug category does not include drugs dispensed in

hospitals and other institutions as these are included in the category which has responsibility to

pay these drug costs.

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IV.2.2.5 Public Health

Services considered as public health were initially focused on providing health protection

(i.e., inspections) and controlling infectious diseases in addition to other services including, but

not limited to, immunization programs, school health, or children’s dental health. More recently,

provinces have shifted the emphasis of public health towards disease prevention and screening as

well as health promotion and wellness. There is a concerted effort towards improving the

population health status of provinces and health regions and developing programs aimed at

special populations such as children and youth, seniors’ citizens, persons with chronic mental

conditions, homeless, single mothers on welfare, etc. Prior to the provincial restructuring of

health care, public health was funded and delivered separately from hospital and physicians

services. Public health was delivered through administratively decentralized public health units.

As the focus shifts towards wellness programs there is an emphasis on increasing personal

responsibility for health status via many provincial health reform initiatives. Public health

services have become a far more important component of the health care system.

CIHI (2007) reports expenditures in this use of funds category for: food and drug safety, health

inspections, health promotion, community mental health, public health nursing, and preventing

communicable disease.

IV.2.2.6 Administration

According to Shah (1998), provincial ministries of health perform three main functions:

financing of health services through service funding envelopes; program administration; and

direct delivery of selected health services. Administrative responsibilities are subdivided to

include: policy formation and standards for services and sectors; planning, evaluation, and

monitoring; administering provincial insurance plans for physicians and drugs;

57

surveillance/communicable disease control; and managing information such as vital statistics and

administrative data bases (Shah, 1998). In the administration category, CIHI (2007) includes

expenditures for: cost of providing health insurance programs and all the infrastructure costs to

operate health ministries. Administration costs for hospitals, other institutions, etc is not included

here but again under the category in which the service is paid for.

IV.2.2.7 Other health spending

Other health spending is subdivided into: other, including home care, medical

transportation, health worked training and voluntary health associations, and health research (i.e.,

“expenditures for research activities designed to further knowledge of the determinants of health,

health status, or methods of providing health care, evaluation of health care delivery or of public

health programs. This category does not include research carried out by hospitals or drug

companies in the course of product development CIHI, 2007, p.65).”

Home care expenditures are reported according to the OECD definition of home care,

i.e., home health services delivered by a health professional (Ballinger et al, 2001). Home

support and personal care services that are publicly funded are not currently reported on in this

category. A CIHI feasibility study by Ballinger et al. (2001) has recommended that CIHI develop

a revised reporting structure which would provide on an annual basis aggregate expenditure data

for both home health and home support services that are publicly funded.

There is wide variation among Canadian provinces regarding the type of home care

available, funding, and how it is delivered. Publicly funded home care can be either delivered

through public and private methods. Public delivery involves provision of home care by workers

who are government employees (Health Infostructure Atlantic, 2002). Private home care delivery

is provided using options including: contracts with a not-for-profit private organization where

58

paid workers are employed by agencies and community organizations such as the Canadian Red

Cross; relying on unpaid workers/volunteers e.g., Meals on Wheels or individuals and their

families; or contracts with a for-profit organization to deliver home care services by corporations

or for-profit entrepreneurs/small businesses including private duty nurses.

In this policy research, the delivery of home care varies in Prince Edward Island Nova

Scotia, and New Brunswick which includes a mix of public and private providers. Description of

the delivery mechanisms are provided in the chapters that summarize each provincial case

[Chapter V (Prince Edward Island); Chapter VI (Nova Scotia); and Chapter VII (New

Brunswick)].

IV.2.3 Allocation Following health reform, Canadian provinces moved to a centrally planned approach for

health care allocations which relied on an intermediary organization or health region to make

these decisions. This approach was recommended in all health reform reports written by various

provincial health reform commissions (Angus, 1992; Mhatre & Deber, 1992). Health regions

were required in their role to balance off such goals as providing as many health care services as

possible for citizens living in a defined catchment area, while also ensuring high quality and

rapid access. Prior to the restructuring of health care delivery, provincial governments came to

view the independence of hospitals as a provider of acute care services as inefficient (King,

1996). For example, hospitals might duplicate services that could be centralized; and with the

independent boards governing them, it was often more difficult to achieve potential savings and

quality improvements from consolidating acute care services as these boards were often

protectionist and territorial (King, 1996). Also, some health care services might be under-

provided as well as gaps not being addressed. Accordingly, many provincial health reform

59

commissions recommended regionalizing the planning and delivery of particular types of acute

care services at the secondary and tertiary levels so that economic efficiencies could be gained

by serving a larger population living in designated geographic areas as well as rationalizing the

beds needed to provide different types of care (Angus, 1992; Mhatre & Deber, 1992). Similar

trends are now encouraging the reform of primary health care.

The use of health regions for the organization, delivery, and allocation of health care was

largely untested prior to being implemented in nine Canadian provinces; in particular, evidence

was lacking about the effectiveness of regions to bring about changes in policy goals (Tomblin

2002; Penning et al., 2002). Nevertheless, regionalization became the policy instrument used by

most provincial governments to locate decision-making for the allocation of health care

resources at this meso or sub-provincial level. Provincial health reform reports argued that by

creating health regions they would: be more responsive in designing services to meet local needs;

create cost savings through economic efficiencies gained by serving a larger population; and

eliminate duplication by rationalizing the number of acute care beds needed based on which

institutions would continue to deliver particular acute care services (Angus, 1992; Mhatre &

Deber, 1992). As a result, local hospitals providing acute care services were ‘centralized’ and

control moved away from these local and independently operating boards to provincially

designated organizations called regional health authorities. This took place in all Canadian

provinces with Ontario being the exception (which is currently moving in this direction).

Regional organizations were also given responsibility for other health care and community-based

service sectors which previously were vested at the provincial level (e.g., home care, public

health). Both decentralization and centralization processes were involved in forming health

regions resulting in combined budgets for various health care services administered by the

60

regions. Combining these various health sector budgets has been described using terminology

such as an integrated budget, funding envelope, or global budget (Nestman, 1995).

Hospitals have played a key historical role in defining local communities as well as being

the major place or site of health care delivery. The CHA guarantees Canadian citizens universal

access to medically necessary hospital-based and physician services. Unlike hospitals, home care

is not part of the CHA and access is not universal. Despite health reform efforts where population

health and community care were emphasized through restructuring of health care planning,

delivery, and allocation of funding, many citizens continued to equate health care with access to

hospital beds and hospital-based acute care services (Tomblin, 2002). Hospitals, unlike most

provincial home care programs, have the backing of physicians who represent powerful medical

interests (Baranek, Deber & Williams, 2004). Home care on the other hand, is for the most part

an ‘invisible’ program since services are provided in the homes of recipients; given the limited

use of home care by mostly elderly or disabled citizens, it may not be as familiar to or as well

known as hospital care is to most Canadians.

Since the late 1950s hospital-based acute care services have been publicly insured with

the passage of the HIDS in 1957. This legislation enabled the federal government to share the

cost of hospital-based services with the provinces. In contrast, home care is a relatively new

health care actor. Home care as a sector gained popularity in the mid 1970s, encouraged by the

development of early discharge programs by hospitals which allowed a shift in the site of care

provision from hospitals to the patient’s home, school, or workplace (Shapiro, 1992). Home care

has also played a significant role in providing services to persons who were de-institutionalized

during the downsizing of mental health institutions in the 1980s (Flood, 1999). There is wide

variation in the extent to which home care is funded by provincial governments (Spalding, 2004).

61

Given these relatively recent developments with limited budgets, provincial home care programs

are regarded as a ‘nascent’ health care sector (Baranek, Deber & Williams, 2004).

IV.3 Canadian Health Care Reform

IV.3.1 Rationale and Impetus for Change

During the mid 1980s, various pressures forced provincial governments across Canada to

re-think how health care services were organized, funded, and delivered. Key cost drivers

included rising provincial deficits and debt. The Canadian proponents of health reform suggested

that savings could be found through reorganizing delivery of health care by shifting more care to

client’s homes and communities (Angus et al., 1995; Hurley et al., 1994). For some time, public

policy had focused on community-based approaches to health where the emphasis on acute care

and hospitals would shift to home care and community-based services; Lalonde had written

about these needed policy shifts as early as 1973 (Crichton et al., 1995). The development of

health regions to engage the public in health care decision-making and in setting local priorities

for health care services was viewed as one of the means to achieve these policy goals (Crichton

et al., 1995; Nestman, 1995). Prior to the rapid rise in public health care expenditures and the

health care ‘share’ of provincial government spending, provinces had not considered how the

organization and delivery of health care with all health sectors operating as a unit might be one

strategy to tackle these troubling financial challenges (Crichton et al., 1995). Up to the 1980s,

financial decisions and trade-offs about health care delivery choices had been carefully avoided

by provincial governments, since most used health care as a political means to gain public

support and did so simply by adding more resources to provincial health care budgets (Angus et

al., 1995).

The Ontario Hospital Association summarized the stated policy goals for regionalization

62

as: 1) cost containment (through rationalization of hospital beds and mid-level health care

managers); 2) service integration and coordination (where less costly services such as home care

were substituted for more costly care); 3) allocation of resources based on local health care

needs; 4) increased operational efficiency through expansion of home and community care using

savings from the downsizing of hospitals; 5) citizen participation through local decision-making;

and 6) population health and wellness (OHA, 2002). Restructuring of health care delivery

developed from an underlying assumption that administrative cost savings could be realized

through the creation of a single administrative entity where budgets of previously segregated

health care sectors would be consolidated (Lomas & Rachlis, 1996). Provincial health reform

commissions vigorously promoted the location of hospitals under a regional organization so

acute care beds and services could be rationalized, resulting in provincial cost savings (Angus et

al., 1995). Cost savings from these measures were hypothesized as being re-directed to fund

additional community-based services such as home care, as well as provide more health

promotion and disease prevention services (Angus et al., 1995). Through unifying the planning

and administration of health care services at a regional level, the health regions were viewed as

critical actors who could advance the health reform policy agenda of provincial governments.

These ranged from promoting a shift to home and community care through to increasing

emphasis on health promotion and prevention, which would be accomplished by engaging

community members in health care decision-making (Crichton et al., 1995).

IV.3.2 Realignment of Roles and Power through Regionalization

Regionalization as an instrument of public policy change was of greater concern to

provincial governments than the federal government since it involved delegating some provincial

powers to a lower level organization (Crichton et al., 1995). The decision-making power of

63

regional health boards was created through ‘blending’ authority and responsibilities collected

from two distinct levels (Deber, 1996; Tomblin, 2002). Health Care sectors where decision-

making power was previously administered by provincial policy elites and bureaucrats that was

decentralized or ‘shifted downward’ include: home care, public health, mental health, and

addiction services.

Provincial policy goals underlying health reform were outlined in section IV.3.1. Given

this close examination of these policy goals, some problems were identified (OHA, 2002; Lomas

et al., 1997; Hunter et al., 1998) including tension and conflict among centrally determined

policy goals; the extent of local autonomy; and potential and possibilities of integrated funding

compared with traditional program-based budgets. Lomas et al. (1997 a,b,c) observed that cost

containment through rationalizing the distribution of hospital beds was not entirely compatible

with the policy goal of attending to local community needs through increased citizen

participation. Similarly, the goals of community empowerment, health system rationalization,

and expenditure reduction were suggested as being mutually incompatible (Lomas et al., 1997

a,b,c). Another contentious issue associated with cost containment is the role economy of scale

can and should play in regionalized health care delivery. Rondeau & Deber (1992) argued that

consumers stand to gain as previously independent health care actors such as hospitals begin to

collaborate around service with a view to maximizing local resources to achieve economic

efficiency. Determining how local needs can best be served through regional planning is deemed

to be more responsive to consumer preferences than a centralized, bureaucratic top down

planning model that was employed prior to health restructuring. However, there must be

inducements to reward and recognize organizations who engage in joint planning; otherwise,

actors with powerful, concentrated interests, and adequate resources will resist change (Rondeau

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& Deber, 1992).

IV.3.3 Local Autonomy versus Central Control

Some policy analysts have argued that regionalizing health care delivery and funding

decisions, would force trade-offs between local and provincial autonomy (Rondeau & Deber,

1992; Saltman & Figueras, 1998). For example, Rondeau & Deber (1992) posed the question

about what would happen if a heath region decides it does not want to provide certain types of

health care services that are required under the CHA? What are the implications of these types of

decisions for local residents in light of the requirements of the CHA regarding universality,

comprehensiveness, accessibility, and portability?

As previously described, health regions took over planning and budget functions

previously performed by ministries of health in addition to those governance functions

previously performed by locally-based hospital boards. This created confusion since the local

community representatives appointed to regional health authority boards by the provincial

government raised questions about the extent to which they could represent their local needs

given the government appointment (Lomas et al., 1997 a,b,c). Lomas et al. (1997 a,b,c) predicted

this situation would be complicated by the fact that “each devolved authority is situated at the

nexus between provincial government’s expectations, the providers’ interests, and the citizenry’s

needs, wants and preferences (p.374)”. The findings from the Lomas & Rachlis (1996)

evaluation of Prince Edward Island health regions in relation to the extent to which they

reallocated funding concluded that the Prince Edward Island health regions had been relatively

conservative in exercising this decision-making authority. However, as experience with

regionalization in the Canadian context grows, longitudinal studies could reveal if equity and

access to health care services have been jeopardized by the formation of health regions of which

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most had a mixed agenda of both satisfying governments while at the same time representing

local interests (Lomas et al., 1997 a,b,c).

Although health regions were given responsibility for health care delivery, in some

instances provincial governments, and in particular, ministries of health continued to play a

strong role in influencing and determining decisions (Lomas, 1997). Given that regional health

boards were not given authority over physician and drug expenditures, provincial governments

maintained an active role in the management of health care resources and were often criticized

for not giving regions responsibility for these high cost expenditures (Church & Barker, 1998;

Lewis & Kouri, 2004). Because physicians and drugs consume a large share of provincial health

expenditures with rising costs, the exclusion of these potential “cost drivers” from regional

administration might hinder the ability of regional decision makers to control costs and plan for

the efficient allocation of resources (Church & Barker, 1998; Flood, 1999).

Prior to health care restructuring, there was a perception that provincial ministries and

health professionals had become unresponsive to the needs of local citizens (Rachlis & Kushner,

1994). Concerns have also been invoked about accountability for program delivery decisions and

how public funds were being spent by central government bureaucrats engaged in health care

planning and funding (Church & Barker, 1998). Consequently, by involving local citizens in the

management and planning of health care services, it was argued regionalization was a more

participatory and democratic approach to health care decision-making and that was now less

dominated by central government bureaucrats. In most jurisdictions, however, health care

providers from local areas (i.e., physicians) were also excluded from the regional boards (Lomas

et al., 1997 a,b,c). However, Lomas et al. (1997 a,b,c,) predicted that these providers, along with

other special interest groups such as unions and professional associations would find ways of

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infiltrating regional decision-making processes as the Quebec experience has shown.

According to Lomas et al. (1997 a,b,c) who participates and the role of local citizenry

relative to other actors was unclear in certain jurisdictions. This confusion grew as health regions

implemented more democratic processes to engage citizens. Some confused the meaning of

citizen input and participation with citizen governance. While on the one hand citizen input

seemed to imply the provision of advice to experts such as health system managers, this could be

a voluntary process; on the other hand, governance implies that citizens, regardless of their

knowledge, could exert decision-making power over more knowledgeable experts (Lomas et al.,

1997 a,b,c; Church & Barker, 1998). European experiences with decentralization have

demonstrated that efforts to enhance the participation of citizens was dominated by professionals

and bureaucrats in addition to the creation of local hierarchies (Elstad as cited in Church &

Barker, 1998).

IV.3.4 Resource Allocation Decision-making under Regionalization

Health care programs were funded from segregated budgets prior to the development of

regional health authorities (Crichton et al., 1995). This planning and budget environment

subsequently built “fences” which protected individual program funding such that resources

were unable to be shifted between programs (Rondeau & Deber, 1992; Hurley et al., 1994;

Lomas & Rachlis, 1996; Angus et al., 1995; Nestman, 1995). The formation of regional health

organizations consolidated decision-making about funding and resource allocation to health

regions. Nestman (1995) wrote about the implications of global budgets in Canada and observed

that, “the transfer of power to a lower level of authority for sectoral budgeting may result in more

gridlock because provider interests in maintaining the status quo may be an overwhelming force

that results in very little improvement” (p.31). Nestman (1995) thought an inhibiting factor to

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reallocating funds [to home care] might be the extent of information required since this would be

considerably more extensive than what existed for stand alone health care organizations.

A prominent health reform objective common across most Canadian provinces which

employed a population health approach was orchestrating a shift in funding to deliver more home

care and community-based services (Penning et al., 2002; Tomblin, 2002; Tomblin, 2004). This

policy goal proved threatening to the interests and power of established actors such as hospitals

and physicians (Lomas, 1997). In Canada, policy trade-offs were accentuated because health

restructuring also took place in the midst of provincial fiscal and budgetary constraints. Where

some provinces such as Alberta made rapid and massive budget cuts (Nestman, 1995); others

pointed out that the funding cuts to hospitals and acute care were not reallocated to home and

community care, but rather were applied to lower provincial deficits (Rachlis & Kushner, 1994;

Lomas & Rachlis, 1996). Earlier experiences from Quebec suggested the ensuing power

struggles usually favoured institutional over community-based actors (Rondeau & Deber, 1992;

Gosselin, 1984). Havens (1998) speculated that regionalization may also curtail home care

funding because the local hospital boards and administrators, who became key actors in health

regions generally yielded more power compared with home care providers and users. To date,

there is limited empirical evidence about whether integrated budgets and regionalized delivery

has achieved a shift in funding to create a more balanced health care system, where the focus is

on increased home care and community-based services (Nestman, 1995; Hurley et al., 1994).

Lomas & Rachlis (1996) studied resource reallocation by the Prince Edward Island health

regions which has been formed in the mid 1990s. They observed that health regions had been

conservative in reallocating resources. Based on these early results Lomas & Rachlis (1996)

questioned whether the results would be different if health regions had there had been a longer

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time frame between their formation and the conduct of the research to evaluate outcomes about

patterns of resource allocation.

Rondeau and Deber (1992) argued that while regionalization was one way of breaking

the gridlock between existing health care funding and delivery structures in situations where

previously no one was willing to give up resources, they claimed the extent to which this can

happen is affected by the array of health care services assigned to a regional portfolio. Among

the nine provinces in Canada who regionalized health care delivery, Prince Edward Island had

the broadest range of services assigned while New Brunswick with only hospitals and home care

had the narrowest array of services (Lomas & Rachlis, 1996; Hurley et al., 1994). Based on the

theoretical framework previously described, it is hypothesized that given the broad range of

responsibility assigned to the Prince Edward Island health regions, they would have less success

in planning efforts to reallocate resources compared with provinces such as New Brunswick and

Nova Scotia who decentralized fewer health care services (and the control of home care

remained with the government in Nova Scotia).

There have been two Canadian studies which evaluated whether or not resources were

allocated to home care and community-based services and population health approaches.

Penning et al. (2002) compared selected health regions in both British Columbia and Manitoba.

Her research found that in British Columbia there was a prevailing trend towards reduction of

health care services whether provided in hospital or community settings, both before and

following implementation of regionalization. In comparison, the trends observed in Manitoba

suggested a mixed pattern of stability and change with access to care remaining much the same

following regionalization, while there was change evident for specific types of care and length of

stay.

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Findings obtained by researchers in British Columbia provide no clear indication of a shift of focus away from a predominantly medical model of care and toward a broader social and community-based model of care. Declines in acute hospital care resources appear consistent with such a move. However, recent declines in outpatient care, alternative health services, home support services, and home nursing care appear less consistent. Findings also suggest somewhat different strategies for health reform within the two provinces. In British Columbia the focus appears to have been on [reductions in inpatient hospitalizations while holding the line on] outpatient care. In Manitoba, reductions in inpatient hospitalizations have been offset by increases in outpatient care (Penning et al., 2002, p. iv).

Penning et al. (2002) concluded that regionalization in both provinces had not significantly

altered the course of change which had already begun prior to it being implemented. The hoped

shift in focus and resources to home and community-based care did not occur.

A Saskatchewan-based study by Marchildon (2005) was presented at a Health Services

Restructuring Conference in November, 2005. The focus of this analysis was on community

health promotion. Marchildon (2005) reported the community health service segment of the

Saskatchewan provincial health care expenditures (which included illness prevention and health

promotion programs) had grown in both absolute expenditures and the share of total health

budget. Although the Marchildon study did not specially evaluate home care, comparative data

about the proportion of home care expenditures between 1994/95 and 20004/05 was available.

The observed trend for home care appeared stable, where the home care share represented

approximately 5% of Saskatchewan’s provincial health expenditures (Figure 9 in Marchildon,

2005).

At the national level in Canada there has been a decrease in the ‘hospital share’ which has

dropped almost 6 percentage points between 1990/91 (49.2%) and 2000/01 (43.4%) (CIHI,

2004) . Over the same time period, the ‘physician share’ dropped about one and a half percentage

points from 21.3% to 19.8% while the ‘other institutions share’ increased by less than one

percentage point from 9.8% to 10.6% for the same time period. Clearly these data about

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provincial expenditures following health restructuring show changes in the proportion of

provincial spending allocated to hospitals. What remains unclear as to whether regional

organizations shifted the hospital-based resources from in-patient care to home care and

community-based services or elsewhere. Rachlis has speculated that the anticipated shifts were

redirected toward provincial debt ad deficit reduction.

The literature about regionalization in the Canadian context is largely descriptive and had

explicated the tensions inherent in regionalizing health care funding and delivery. Limited

Canadian empirical evidence exists about the impact of regionalization on policy goals related to

shifting care and resources (Lomas et al., 1997; Reamy, 1995; OHA, 2002; Penning et al., 2002;

and Tomblin, 2002). Penning et al. (2002) is one Canadian empirical study which evaluated the

capacity of health regions to allocate funding to home care and community-based care

comparing British Columbia and Manitoba. Lomas and Rachlis (1996) evaluated the capacity of

the Prince Edward Island model to reallocate funding between sectors. These results have been

less positive in relation to what early proponents of health restructuring had anticipated. Under

the time frame of this policy research provincial government home care expenditures were

aggregated by CIHI and included in the other health spending in the use of funds category. The

study of resource reallocation to home care is complicated by data limitations in relation to

provincial government expenditures for home care which are described in Chapters III and VIII

Accordingly, with the exception of two CIHI studies specifically about home care (Ballinger et

al., 2001 and CIHI, 2007) it is not possible for CIHI to annually report on the home care share of

government health expenditures (Appendix A-8) given the inclusion of home care expenditures

in the more general ‘other health spending category for use of health care funds.

While the potential of regionalization as a policy instrument to reallocate resources was

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proposed in the early 1990s, clearly a knowledge gap exists about the implications of these

natural experiments which nine of ten Canadian provinces implemented. Empirical evidence

about the impact of the provincial models of regionalization on resource allocation to health care

sectors is needed. The purpose of this policy research is to generate empirical evidence about the

extent to which there was a shift in resource allocation to home and community care from

hospitals.

IV.4 Home Care in Canada

A federal-provincial working group on publicly funded home care in Canada was formed

in 1988. It made an extraordinary contribution to the development of the home care sector when

this working group defined home care as: “an array of services which enables clients,

incapacitated in whole or in part, to live at home, often with the effect of preventing, delaying, or

substituting for long-term care or acute care alternatives” (Federal/Provincial/Territorial

Working Group on Home Care, 1990). This comprehensive report about home care services in

Canada, which has been widely accepted among policy makers identified three distinct roles for

home care, which are not mutually exclusive (Ballinger et al., 2001):

1. a substitution function for services provided by hospitals and long-term care facilities;

2. a maintenance function that allows clients to remain independent in their current

environment rather than moving to a new and more costly venue; and

3. a preventative function, which invests in client service and monitoring at additional short-

run but lower long-run costs.

An underlying principle for each type is enabling individuals with either acute and chronic

conditions to live at home while receiving care. Home care services wrap around the client's

strengths in conjunction with his/her informal [unpaid] care network (i.e., family, friends,

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volunteers) to fill a gap between met and unmet needs. Accordingly, the amount of services and

level of provider should be the minimum needed to promote wellness by maximizing the client's

functional capacity to avoid creating dependency (Shapiro, 1991).

IV.4.1 Funding and Delivery

There are no national terms and conditions for home care which provinces must adhere

to. This has resulted in a varying range of provincial commitments to include home care as a

publicly funded health care service (as all do to some extent). Not surprisingly, there is

considerable variation across the provinces in terms of who is eligible for home care services or

who has ‘access’ to care and what types of home care services are provided. Examples of home

care program characteristics where inter-provincial variations exist include: the organization and

governance of home care (i.e., whether home care is administered or not by regional health

authorities); provincial legislation (i.e., whether entitlement to home care services is legislated or

not); type of home care services (i.e., whether services provided are comprehensive or limited to

nursing and supportive care); funding mechanisms used to pay home care providers (e.g., block

funds, fee for service, line by line funding which is retrospectively claimed by the provider or

prospectively granted to a provider by either a health region or province) and lastly, whether or

not co-pay or user fees were charged (Dumont et al., 1998). Most users of provincial home care

are elderly persons; however, disabled adults and children may also qualify for services, as do

persons with chronic mental health diseases and disabilities (who in fact now receive home care

instead of being institutionalized) (Flood, 1999).

The extent to which federal funds are used to fund provincial home care programs is

currently unknown, given the federal government’s move to a block funding mechanism under

the CHST. Following the implementation in 1996, provincial governments had the flexibility to

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allocate the global CHST funding to health, education, and social services based on local needs.

The federal government no longer requires provinces to account for how CHST funds are used,

unlike the reporting previously required under the EPF and CAP programs. Provinces were

reimbursed retrospectively for their spending up to approved limits (Dumont-Lemasson et al.,

1998).

Historically, budgets for home care programs were determined by provincial government

program administrators who worked in centralized program divisions located in health

ministries. Many different types of funding arrangements for home care developed given the

wide variation in how home care services are delivered in each province (Dumont-Lemasson et

al., 1998; Hollander & Walker, l998). Prior to the restructuring of health care delivery, centrally

administered divisions with responsibility for home care program annually determined the extent

of home care funding. Following restructuring, these divisions continued to: set overall policy

guidelines and standards for regional service delivery, outline reporting requirements, and

monitor outcomes.

Since the late 1980s, Canada has seen a marked trend away from providing care in

hospitals and institutions and a concomitant growth in demand for home and community care

(Havens, 1998; Health Canada, 1999a, 1999b, 1999c; Coyte & Young, 1997; CIHI, 2000). There

are three major, but as yet to be fully evaluated, justifications for this shift to home and

community care: 1) emerging evidence that procedures previously performed on an in-patient

basis can be done just as effectively on an ambulatory care basis followed by home care; 2)

emerging evidence that care in home and community can achieve cost-efficiencies compared to

care in institutional settings when clinical guidelines and care planning protocols are used;

(Coyte & Young, 1999; Chappell, 1994; Jackson, 1994; Hollander, 1994; 1999); and 3) the belief

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that services provided "closer to home" enhance consumer choice, independence and quality of

life, and positively affect health and well-being (Shapiro, 1992; BC Royal Commission, 1991).

During the 1990s when provincial health spending was increasing by 2.2% annually,

home care grew at an annual rate of about 9.0% (Coyte, 2000). Ballinger et al. (2001) reported in

a CIHI-sponsored feasibility study about home care that total provincial sectoral home care

expenditures had increased by over 350% from 1988/89 to 1998/99. During that same period,

annual growth rates averaged 16.6% compared to average increases of 4.2% in total provincial

health expenditures. The home care ‘share’ of provincial health expenditures increased from

1.6% in 1988/89 to 4.7% in 1998/99. Ballinger et al. (2001) attributed most of this growth to the

increased provision of home (or non-professional) support services. Investment in home care has

varied from province to province; ranging from over 5% of total health spending in Ontario,

Manitoba, Nova Scotia, and New Brunswick to less than 3.0% in Quebec, Alberta, Prince

Edward Island and the Territories (MacAdam, 2000). In 1997-98, the national per capita home

care expenditure was $69.00 (MacAdam, 2000). More in-depth analysis of resource allocation to

home care in Prince Edward Island, Nova Scotia, and New Brunswick in Chapters V through

VII.

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CHAPTER V: THE CASE OF PRINCE EDWARD ISLAND

This chapter presents the findings of a case study on the Prince Edward Island

regionalization model. The provincial government assigned a broad array of health care sectors

and social services for regional administration. Home care was included in this restructuring,

whose aim was breaking down sector-based budget silos. The policy context at the time

regionalization was implemented is described. Per capita expenditures and the share of

provincial government spending for home care are reported on and compared with hospitals to

examine whether or not resources were re-allocated from the acute care sector to home care.

Observations from key informant interviews assist in interpreting these findings.

V.1 The Policy Context

V.1.1 Geography and Demographic Characteristics

Prince Edward Island is located on the east coast in the Gulf of St. Lawrence. It is the

smallest of the Canadian provinces, both in land mass (5660 square kilometers) and in

population. There are two major urban centers: Summerside and the provincial capital of

Charlottetown.

The population of Prince Edward Island was 136,700 residents in 2000/01, which

represented one percent of the Canadian population (CIHI, 2003; Appendix B-1). Approximately

55% of Prince Edward Island residents live in rural areas and 45% reside in urban areas (CIHI,

2003). Between 90/91 and 00/01 the total provincial population increased by 5%, while the

Canadian growth rate was 12%. As of 2001, 13.6% of the Prince Edward Island population was

over the age of 65; this is higher than the Canadian proportion of 12.7% (CIHI, 2003; Appendix

B-2). Many older residents living in small towns and rural communities along with a declining

younger population, is creating challenges for how essential health care and social services can

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be efficiently, effectively, and safely provided.

V.1.2 Economic Characteristics

The economy of Prince Edward Island has been structured around natural resources such

as the fishery, forestry, and mining as well as farming; Prince Edward Island’s economy is

predominantly situated in rural communities. These communities are becoming increasingly

isolated however, as economic activity shifts from natural resources and jobs related to the

service industry are created in urban areas.

The unemployment rate for Prince Edward Island was 12% in 2000 and slightly

decreased to 11.9% in 2001 (CIHI, 2003). This rate is well above the Canadian average of 6.8%

and 7.2% for comparable years. In 2000, the average family income in Prince Edward Island was

$23,710 (CIHI, 2002). This is approximately $6000 or 25% below the average Canadian income

level of $29,769. This shift in economic activity has resulted in mounting provincial debt and

ongoing government deficits which mean that less government revenue is available to spend on

health care and other government services.

V.1.3 Health Status Indicators

The life expectancy in 2001 for Islanders was 78.6 years, compared to the Canadian

average of 79.5 years (CIHI, 2005). The 1996 infant mortality per 1000 live births for Prince

Edward Island was 4.6 compared with the Canadian rate of 5.8 (CIHI, 2002). Disability free life

expectancy (or the years of life before developing a moderate or severe disability) for 1996 was

67.6 years; this is slightly less than the Canada rate of 68.6 years (CIHI, 2003).

The percentage of Prince Edward Island residents who report their health status as very

good or excellent is 64%, which is better than the Canadian rate of 61.4% (CIHI, 2003). The

percentage of Prince Edward Island residents who rated their health as fair/poor was 12.4%

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which is very close to the Canadian rate of 12% (CIHI, 2003).

VanTil (1999) extracted the following key observations about the health status of Prince Edward

Island residents from the Second Report on the Health of Canadians. VanTil observed “that

Islanders have a high level of positive mental health and the highest level of social support in

Canada. Prince Edward Island’s income distribution is one of the most equitable in Canada

(1999, p.15).” Prince Edward Island women have high rates of mammography screening and its

senior citizens are more likely than other Canadians to be immunized against influenza. There is

a high level of smoking among men and Prince Edward Island has the lowest rate of physical

activity in Canada. Prince Edward Island has the highest rate of cardiovascular deaths and one of

the highest lung cancer mortality rates in Canada. Prince Edward Island women have the lowest

rate of pap smear screening in Canada and a higher rate of cervical cancer. High unemployment,

high alcohol consumption, and a low level of education have taken a toll of the health status of

Islanders.

The lower socioeconomic status of the Prince Edward Island population, coupled with its

performance on various health status indicators, suggests that on the whole, Prince Edward

Island residents are less healthy compared to other regions of Canada. These results produce

challenges for the Prince Edward Island health care system. On the one hand, there is an urgent

need to continue delivering treatment of acute and chronic diseases in tandem with the need to

shift resources to enhance access to community-based care and health promotion and prevention

programs. These competing needs complicate priority setting and resource allocation.

V.1.4 Political Environment

The Prince Edward Island Legislative Assembly has 27 electoral districts. Each district

elects one member. Three provincial elections were held during the time frame of this policy

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study, i.e. in 1993, 1996, and 2000 (Appendix B-4). During the first five years of health reform,

which began in the early 1990s through 1996, the Liberals formed the provincial government. In

1996, this government was defeated by the Progressive Conservative party led by Pat Binns. The

Binns-led PC government was re-elected in April, 2000. Recently, Islanders have once again

elected a Liberal government.

V.2 Structure of Prince Edward Island Health Care before Regionalization

V.2.1 Hospitals

Hospitals, which provide in-patient, outpatient / ambulatory and emergency care are one

of the subsectors where public funding is required in accordance with terms and conditions

specified in the Canada Health Act (CHA). Prior to health restructuring, Prince Edward Island

had 7 acute care hospitals, which are private, not-for-profit providers of acute care, governed by

an independent board of directors/trustees. Annual budgets were set by the Health Ministry;

however, decisions about which acute care services and programs would be delivered were made

locally by the hospital board of trustees and hospital administration. The Queen Elizabeth

(located in Charlottetown) and Prince County (located in Summerside) hospitals each delivered

secondary acute care, while selected specialized acute care services were only provided at the

Queen Elizabeth. Prince Edward Island heavily relies on the health science and tertiary care

centres located in New Brunswick and Nova Scotia to deliver complex and specialized acute

services for trauma, heart transplant, chemotherapy, and neurology patients.

V.2.2 Other Institutions – Nursing Homes

Nursing home care in Prince Edward Island is paid for largely as out of pocket costs. All

applicants for the type of care delivered by these facilities (which are categorized by CIHI as

‘other institutions’) are assessed to determine if the individual has financial resources including

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monthly income and other assets to pay for this care. Because public funding is used for only

those individuals who cannot afford to pay for this service, approved applicants can be asked to

pay up to the full cost of care (Hollander & Walker, 1998). This approach is considered to be a

welfare model of service delivery since long term care does not fall under the definition of

medically necessary health care as defined by the CHA. Public or government funding is only

used to pay for those who cannot pay privately.

There were 18 nursing homes or government manors operated by either the provincial

government or private owners, prior to health restructuring. The government-owned nursing

homes had advisory boards.

V.2.3 Home Care

Publicly funded home care came into existence in Prince Edward Island in 1979/80

(Ballinger, et al., 2001). Prince Edward Island chose the name for its home care program — the

Home Care Support Program — by combining the terms home care and home support

(Hollander & Walker, 1998). The mandate of the Prince Edward Island Home Care Support

Program is the prevention of unnecessary, premature, or prolonged institutionalization (Health

Infostructure Atlantic, 2002). The program provides a full range of home health care including

professional nursing services and ancillary services such as home support (Ballinger, et al.,

2001). Clients are grouped according to need: short-term, intermediate, continuing care, or

specialized care (Hollander & Walker, 1998). Home care, unlike physicians and hospitals, is not

a protected health care sector under the CHA. This lack of national terms and conditions has

implications for the way in which provinces fund and deliver home care.

V.2.4 Public Health Services

Public health services were funded and delivered separately from hospital and physicians

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through administratively decentralized public health units. They were publicly delivered by

government employees working in these locally-based health units.

V.2.5 Functions of Prince Edward Island Health Ministry Eyles (2001) notes that, before health restructuring there were 23 separate boards and

provincial government divisions each with differing responsibilities for delivering health and

social services. These independent boards were accountable to a combined Ministry of Health

and Social Services.

Within the Prince Edward Island Health Ministry, there were a series of administrative

units and program divisions responsible for determining annual budgets or funding envelopes for

various health sectors including: hospitals, physician services (i.e. provincial insurance plan),

public health, continuing care (including home care and nursing homes), mental health,

addictions, and prescription drugs. Each had its own director or administrator, budget line, and

program staff. These divisions were fragmented and program budgets operated independently in

silos. Accordingly, this approach had created a planning and funding gridlock which prohibited

the movement of resources across sectors.

Although most care was privately delivered, Prince Edward Island made some use of

public delivery, particularly for home care, public health, addictions, and mental health. For this

purpose, the province was divided into administrative service areas based on geography and

population patterns.

V.3 Restructuring Health Care in Prince Edward Island

V.3.1 Rationale and Impetus for Change

During the early 1990s, the Liberal government introduced a comprehensive review of

provincial government operations. The Prince Edward Island government had formulated several

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overarching principles of change which were key drivers of this overall initiative aimed at

reforming government. These included: withdrawing government from some activities by

reducing its size and cost; recognizing and using market forces in the public sector; and using

new models of management and decision making (Crossley, 1995). Various Ministry-led Task

Forces (e.g. within Health, Education, Tourism, and Agriculture) were implemented in July,

1990. These were coordinated by the Prince Edward Island Cabinet Committee on Government

Reform.

The Task Force on Health issued a report in March, 1992: Health Reform: A Vision for

Change. In so doing, the Task Force relied on existing evidence to prepare this policy and

planning document describing the vision which formed the basis for health reform. Task Force

members attended regionally organized focus groups where health care providers offered

observations and advice about health care. Since this task force did not have non-governmental

membership, it differed from the types of health reform commissions formed by other Canadian

provinces. Despite this difference in composition, the reform ideas developed were consistent in

that a major reform suggested by all was regionalizing the delivery and planning of health care

(Crichton et al., 1997). Appendix B-5 provides a chronology of health reform milestones for

Prince Edward Island. Numerous reasons were identified by the Task Force (1992) as to why

changes to health care were needed. These included: a lack of emphasis on health promotion and

community-based services such as home care; fragmented administrative structures, each with its

own mandate and funding, resulting in fragmentation and inefficiencies in management; health

care services evolved over time in the absence of needs-based planning and evaluation of

effectiveness; financial constraints facing the Prince Edward Island government which has one of

the highest percentages of gross domestic product spent on health in Canada; rising health care

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costs and greater utilization; a lack of community and individual responsibility for and

involvement in services planning and decision making; and, difficulties in coordinating health

services across a continuum of care.

V.3.2 Policy Goals and Principles Underlying Regionalization

The Task Force recommended a two pronged approach to implementing planned change

to health care in Prince Edward Island through improved policy development and consolidated

management and delivery. From a structural perspective, two mechanisms were proposed. The

first was a Provincial Health Policy Council which would conduct both vertical policy

coordination among the health sectors and providers and horizontal policy coordination across

various policy fields within government. The second approach was aimed at addressing the issue

of fragmented management whereby a single management structure governed by one board was

recommended to deliver and plan health care services for specified regions.

A health transition team developed an implementation plan, Partnership for Better

Health, published in June, 1993. Four key concepts were fundamental in the vision for health

care developed by the Task Force: 1) health promotion and illness prevention were to replace the

view that essential health care services should focus only on diagnosis and treatment; 2)

community-based services were to be emphasized to reduce reliance on in-patient acute care; 3)

individuals and communities must become involved in planning of integrated health services that

meet local needs; and 4) provincial policy leadership must be established. Underlying these

policy goals were numerous principles that would guide the reform of how Prince Edward Island

health and community services were delivered. These principles were: a focus on people, not

institutions; community members were to be involved in planning and decision making about

how services were to be provided and where; promotion of health; a broader determinants of

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health approach involving direction and philosophy provided by health professionals,

government, and public representatives; delivery of health care using a partnership approach

among all service providers; building a system based on primary health care principles;

protection of the principles of the CHA; and delivery based on allocating resources to priority

areas of need. According to Lomas & Rachlis (1996) who evaluated health restructuring in

Prince Edward Island, these health reform policies and principles provided a compelling vision

and a strong commitment to a broad-based population health approach.

The government recognized the role that a determinants of health approach could play in

increasing the health status of Islanders, since carrying on with the status quo that placed most of

the emphasis on delivering acute care services was not acceptable to the government (Lomas &

Rachlis, 1996). The blueprint for Prince Edward Island’s health reform involved a desire by

government to integrate the delivery and planning of health, social, and community services

through a regional structure that went beyond traditional acute health care boundaries. Increased

citizen participation in decision-making was emphasized. The formation of health regions was

viewed as an opportunity to reform management structures to facilitate the redistribution of

resources away from the acute care sector to provide more community-based services such as

home care, health promotion, and disease prevention. However, spending patterns for various

health care sectors were entrenched. Substantial spending had reinforced the power of certain

health sectors such as acute care. Health regions were to be the mechanism to “unfreeze” these

established spending patterns and break down silos resulting in resource re-allocation across

programs and sectors (Lomas & Rachlis, 1996; Crichton et al., 1997).

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V.3.3 Characteristics of Prince Edward Island’s Regionalization Model

V.3.3.1 Population size

There was a wide variation in the population size of the health regions; e.g.; East Prince,

33,854; West Prince, 15,571; Queens, 67,312; Eastern Kings, 7820; and Western Kings, 15,571

(Prince Edward Island System Evaluation Project, 1997). There was a difference in population

size of 60,000 residents between Eastern Kings (the smallest region) and Queens (the largest

region). At the time regionalization was implemented in Prince Edward Island and elsewhere

throughout Canada, it was unclear about the implications of population size on the ability of

health regions to effectively and efficiently plan and deliver health care.

V.3.3.2 Design, governance, and accountability: a legislative framework

During August 1993, the Health and Community Services Act was passed, which set out

the structures and processes for the Prince Edward Island health regions. Various sections were

organized on a variety of topics related to the specifics of how health regions would function

(Appendix B-6 for key elements extracted from the legislation).

Initially, the Prince Edward Island Minister of Health was responsible for appointing

regional health board members. As of 1999, the composition changed to include both elected and

appointed members. The size of the boards was set at a minimum of seven members (Prince

Edward Island System Evaluation Project, 1997).

The restructured role of the Ministry of Health and Social Services was to provide an

overall budget for health care and to develop broad policy guidelines. Specifically, the Ministry’s

functions were described as: 1) setting the strategic direction and policy for provincial health

system; 2) being responsible for the health and community services (inclusive of housing and

employment); 3) funding physician services; 4) allocating funds to regional boards, and 5)

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setting standards, monitoring, and evaluating the health care system (Nova Scotia Department of

Health, 1997). The legislation contained a list of powers the Minister may execute. These

included: dissolving a health authority; amalgamating two or more regional authorities; or

varying the geographic jurisdiction.

The legislation precisely described the accountability expectations for the health regions:

presenting an annual report both at a public meeting and to the Minister of Health and Social

Services, preparing audited financial statements, and developing regional service plans. Eyles et

al. (2001) categorized the Prince Edward Island legislation as decisive based on its explicit

population health perspective and accountability requirements through which regionalization was

to be monitored.

Two provincial structures were put in place to complement the restructuring of health

care planning and delivery. The first was the Health and Community Services Agency. It was a

Crown corporation with an independent board. The mandate was to plan the Prince Edward

Island provincial health system, make funding decisions and allocate budgets to health regions

and provincial programs, define core services, and provide program development and support.

The second was a Health Policy Council which provided arms’ length, strategic policy advice to

the Minister. Approximately 2000 provincial government employees were reassigned to the

health regions with another 120 reassigned to these two new central bodies (Prince Edward

Island System Evaluation Project, 1997).

V.3.3.3 Regional functions and assignment of services

The primary function of the health regions was to administer and deliver health and

community services through assessing needs, setting priorities, and allocating the funding

transferred from the provincial government. In response to particular service needs identified, the

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Prince Edward Island legislation did allow a health region to provide a program or service which

extended beyond the specified core services. However, these actions had to be justified with the

Minister. The legislation provided various options about how health and community programs or

services can be delivered. A region can own and operate facilities, provide services and programs

using employees of the health region, or use service agreements with existing service providers

(e.g. nursing homes). No limiting factors appeared in the legislation which prohibited a health

region from making cross-sectoral resource allocation decisions or reallocating resources from

one existing sector or service to another.

The five health regions were responsible for various health and human services including

hospitals, home care, mental health, addictions services, residential long term care, corrections,

income security/social assistance, employment development, public housing, child and family

services, housing, and public health (Nova Scotia Department of Health, 1998). This broad array

of health and community services was the most encompassing of any provincial health reform

initiative (Denis et al., 1999, Eyles et al., 2001a,b; Lomas & Rachlis, 1996). The regions did not

have responsibility for physician or drug expenditures, as was the case for all provinces that

regionalized the delivery of health care.

The Prince Edward Island model clearly went beyond the boundaries of traditional health

care delivery, given the inclusion of other human services in the regional basket of services. One

regional key informant viewed these expanded responsibilities as positive because this approach,

“provided you with the opportunity to make the most appropriate decisions within a spectrum of services as opposed to a specific program.” The comprehensiveness of the Prince Edward Island model was a deliberate one in order that the

health regions could reallocate funds in line with the determinants of health (Lomas & Rachlis,

1996).

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V.3.3.4 Implementation of regionalization

By the spring of 1994, the Prince Edward Island Ministry of Health and Social Services

created five health regions - East Prince, West Prince, Queens, Eastern Kings and Western

Kings. A comprehensive ‘basket’ of health and community services was formally transferred in

April 1994.

Following the 1996 provincial election, the Liberal government, which had been the

architect of Prince Edward Island’s regionalization model, was defeated. A Progressive

Conservative government led by Pat Binns was formed. Along with this new government, also

came some adjustments to the health reform approach implemented by the Liberals. First, the

Health and Community Services Agency was dissolved and the functions were returned to the

Ministry of Health and Social Services (Hollander & Walker, 1998). Second, the first

reorganization of regional health board responsibilities involved a decision to re-centralize

correctional services to the provincial Ministry of Justice. Once again, in early 2001, the

government made some modifications to the Prince Edward Island regionalized system of health

care delivery. These included: reducing the number of health regions from five to four and the

administration of secondary and specialized hospital services was re-centralized to a newly

formed organization within the Ministry called the Provincial Health Services Agency (Canadian

Centre for the Analysis of Regionalization and Health, 2004). These changes indicated the Prince

Edward Island government was perhaps re-visiting the benefits of a regionalized approach to the

delivery of health services as evidence about the requisite factors needed in order for

regionalization to be effective was emerging (Lewis & Kouri, 2001). For example, the Prince

Edward Island population was too small for regions to be effective since most lacked a critical

mass of residents’ located in particular geographic areas to regionalization to be an effective

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instrument to organized health care delivery. An ongoing challenge for the province of Prince

Edward Island is that the total provincial population is equivalent to the population size of health

regions in other Canadian jurisdictions. During this study time frame (1990/91-2000/01) there

was stability in the Prince Edward Island model since home care and hospitals continued to be

regionally administered. This consistency was integral in compiling baseline financial

information about per capita expenditures and the home care share of government health

spending.

V.4 Regionalization Results: Analyzing the Impact

V.4.1 Hospital Funding, Delivery, and Allocation

Following the introduction of health restructuring in Prince Edward Island, there was a

decrease in the utilization of in-patient hospital beds (Table 5-1). Health regions were mandated

to rationalize acute care beds and as a result, some developed ambulatory care services and

community programs to shift the location of acute care delivery. The number of hospital beds in

Prince Edward Island decreased by 22 beds (4.4% ) from 505 in 1993 to 483 in 1999 through to

2001 (Province of Prince Edward Island 2000, 2002). As Table 5-1 also shows: the number of

hospital admissions and total hospital days declined, however the average length of stay of 8.1

days in 2001 was well above the Canadian rate of 7.3 days. By 2001, hospitalization rates had

fallen by 2,363 days (13%) and total hospital days declined by 9,405 days (7%) and these

findings resembled the Canadian trends. However, the regionalized system continued to face

challenges regarding the length of time patients remain in hospital following admission for acute

care treatment.

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Table 5-1: Selected acute care indicators, Prince Edward Island

Indicator (Canada in parenthesis) 1995 2000 2001 Hospitalizations 18594 17078 16213 Age Standardized Hospitalization Rates per 100,000

13,386 (10,942)

11,767 (9,137)

11,015 (8,796)

Total Hospital Days 141227 138399 131822 Average Length of Hospital Stay (in days)

7.6 (7.2)

8.1 (7.2)

8.1 (7.3)

Source: www.cihi.ca/cihiweb/en/media_19nov2003_tab1_e.html; tab2_e.html;tab3_e.html;tab4_html;

V.4.2 Nursing Home Funding, Delivery, and Allocation

Coordinated entry to nursing homes (and also home care) was introduced in 1996 to

provide a single point of access (Hollander & Walker, 1998). The philosophy underlying single

entry is that home care services can be ‘substituted’ for lower levels of care previously provided

by nursing homes. Supportive housing is another option which also delivers support services to

those in need of light care. In Prince Edward Island, the term continuing care is used to describe

the overall system of long term care delivered by nursing homes, home care, and other

community-based services such as supportive housing (Hollander & Walker, 1998).

V.4.3 Home Care Funding, Delivery, and Allocation

The home care delivery model had used Ministry employees to provide in-home services

and following assignment of home care to the regions, regional employees assumed this role

(Ballinger, et al.,). Home care and support assessors/case managers provided assessment and care

planning services to medically stable individuals and defined groups of clients with specialized

needs who, without the support of a formal home care program would be unable to return to their

own home from a hospital or other care setting or are at risk being admitted to a nursing home.

The range of home care services available in Prince Edward Island included: nursing, home

dialysis, visiting homemakers, community support services, occupational therapy, physiotherapy,

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adult protection, and long term care placement (i.e. assessment for admission to nursing homes)

(Ballinger et al, 2001). Other services such as social work, nutrition, and speech therapy can be

accessed through regional resources. There are defined service limits with respect to the amount

and intensity of services available and in relation to the amount of time home care is provided.

Regions have the authority to exceed these limits.

Utilization data is not available prior to 1998/99. Table 5-2 illustrates recent data about

home care admissions in Prince Edward Island where total admissions between 98/99 and 00/01

increased by 3.0% or 48 clients. There was a very small increase in admissions for clients aged

75 and older.

Table 5-2: Home care admissions, Prince Edward Island

Indicator FY 1998/99 FY 1999/00 FY 2000/01 Total Home Care Admissions 1855 1813 1903 Total Admissions age 75 + 1119 1070 1122 Source: Prince Edward Island Ministry of Health and Social Services (2002)

As shown in Table 5-3, the average monthly caseload grew by 8.3% or 166 cases

between 1999/00 and 2000/01. Approximately 20% of the average monthly caseload includes

individuals who receive more than one type of home care service. The highest proportion of the

caseload receives nursing care at 45% followed by home support at 30% and occupational

therapy at 12%.

Table 5-3: Average monthly caseload by home care service, Prince Edward Island

Service Average Caseload Per Month FY 1999/00 FY 2000/01 Nursing 903 982 Home Support 704 726 Occupational Therapy 159 220 Physiotherapy 50 39 Social Work n/a n/a Community Support Worker 87 124

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Adult Protection 48 49 Nutrition 45 22 Tele home care 0 0 Total Caseload 1996 2162 Source: Prince Edward Island Ministry of Health and Social Services. (2002).

V.4.4 Provincial Government Health Care Expenditures

In 1990/91, Prince Edward Island provincial government health expenditures (current

dollars) were $176 million and $263 million in 2000/01 (Figure 5-1), which is a 49% increase.

Annual percent changes ranged from a decrease of 4.8% (1994/95 which is the year after

regionalization was implemented) to an increase of 9.9% for both 1991/92 and 1998/99 (Figure

5-2). The 1991/92 increase preceded a March 1993 election where the Liberals maintained their

majority government status, while the 1998/99 increase preceded an April 2000 election when

they were defeated.

Per capita provincial government health expenditures (current dollars) for Prince Edward

Island ranged from $1352.87 for 1990/91 to $1928.82 for 2000/01 (Figure 5-3). The 1990/91 per

capita is approximately $200 less than the Canadian per capita; however, this gap diminishes to

about $150 as of 2000/01.

Between 1990/91 and 2000/01, the provincial government health expenditures increased

from just over 23% to 25.3% of total government spending including debt charges (Figure 5-4).

In 1994 (when regionalization was introduced), it was 20.4%, compared with 23.7% for the year

preceding and 23.8% for the year following the formation of the health regions. These findings

suggest that at a minimum, the heath regions achieved one-time cost savings in the first year of

restructuring of health care delivery.

In 2000/01, Prince Edward Island provincial government health expenditures as a

percentage of the provincial GDP was 7.8%, compared with the Canadian rate of 6% (Figure 5-

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5). This percentage is slightly lower than it was for the years preceding regionalization (i.e.

before 1994), where it hovered at just above 8%. These data again suggest regionalization could

have played a role in reducing provincial health spending. For most of the years between

1990/91 and 2000/01, the provincial government health expenditures as a percentage of the

provincial GDP were about two percent points higher than the Canadian average.

V.4.5 Provincial Government Home Care Expenditures

Ballinger et al. (2001) reported that 90% of the total home care expenditures funded by

the provincial government was for salaried care providers with the following breakdown: 28%

for nursing services; 50% for home support services including personal support, homemaking,

and caregiver respite; and 12% for rehabilitation services including physiotherapy and

occupational therapy. The remaining 10% of the provincial home care budget is for

administration.

Government home care expenditures for Prince Edward Island include payments for

services e.g. nursing, home support as well as administration costs such as assessment and care

coordination (Ballinger et al., 2001). Publicly funded home care expenditures (constant dollars)

increased by 71% between 1990/91 and 2000/01 ( Figure 5-6). The annual percent changes

decreased by 6.8% in 1994/95, the year after home care was regionalized, but increased to 19.8%

in 1995/96, for the second year home care was administered by the health regions (Figure 5-7).

During four of the 11 years reported on, Prince Edward Island had higher annual percentage

increases than the Canadian average increases.

The per capita home care expenditures (constant dollars) increased from $24.11 in

1990/91 to $35.43 in 1998/99. This represents a 47% increase (Figure 5-8), compared with an

increase of 121% for the Canadian average per capita. In 1990/91, the Prince Edward Island per

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capita average was approximately $15.99 less than the Canadian average and by 1998/99, this

difference had gown to $53.49. Some possible explanations for these differences in per capita

include: the clients admitted to the Prince Edward Island home care program have lower levels

of acuity and therefore receive less intensive services (i.e. less nursing care which is one of the

more expensive services) than reflected by the Canadian average per capita; Prince Edward

Island clients may receive a lower quantity or volume of services per case; and home care

providers are paid lower wages. Given the rural nature of the province more, more informal care

is provided by Prince Edward Island family members as pointed out by VanTil (1999). Given the

longer length of stay occurring in hospitals, it appears that acute care replacement home care is

not as yet fully developed in Prince Edward Island.

V.4.6 Home Care and Hospital Resource Reallocation

Between 1990/91 and 2000/01, the hospital share of Prince Edward Island provincial

government health expenditures decreased from 54.3% to 48.4% (Appendix A-8), while the

home care share increased from 1.6% to 2.2% (Figure 5-9). The home care sector reached 2% of

provincial government health spending in 95/96, which is two years after the health regions had

been formed (Figure 5-9). By 2000/01, the home care share had risen to 2.2%. This finding

suggests the Prince Edward Island health regions did make small resource reallocations to home

care from hospitals.

Coyte (2000) reported some provincial jurisdictions had allocated approximately 5% of

provincial government health spending to home care. CIHI (2007) reported in 2002/03 the

average Canadian share of provincial expenditures for home care share was at 4.2% which is

about one percent higher than the 3.1% share in 1994/95. Nevertheless, the Prince Edward Island

share at 2.2% remained well below the Canadian average.

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Note that the length of stay for acute care in Prince Edward Island was 8.1 days in 2001,

compared with the Canadian rate of 7.3 days (Table 5-1), but a complicating factor is the

residents could have been treated outside of the province. Judging by these numbers, the increase

in sectoral share of provincial government health spending allocated to home care does not

appear to have been sufficient to effectively substitute in-home care for in-hospital care. Since

data about home care utilization was not routinely collected until the late 1990s, it is not possible

to determine whether the additional money allocated was used to buy expanded home care

services aimed at providing acute care substitution, to increase the number of users, or to

increase the volume of services provided. Although length of stay for hospitals remains high, the

data in Table 5-2 shows a modest increase in home care admissions and an increase in the

monthly caseload of approximately 166 cases between 1999/00 and 2000/10. The Prince Edward

Island standardized utilization per 1000 population for home care was 26.1 users in 2003, which

was about the same as the Canadian average (CIHI, 2007). Despite this, it is not known about the

extent to which the health regions viewed home care as an instrumental in the delivery of health

care, and whether they saw home care as an economical alternative to in-patient hospital care. As

Eyles et al. (2001) pointed out, many Prince Edward Island citizens and other health actors

appeared to privilege acute care and hospital beds over other less known and understood types of

health services such as home care. These and other opinions of key local actors could have

influenced the health regions to take a conservative and cautious approach to re-allocating

resources from acute care to home care in the early years following the restructuring of health

care delivery in Prince Edward Island.

V.4.7 Regional Home Care Expenditures

Figure 5-10 illustrates home care expenditure trends for the five Prince Edward Island

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health regions. Regional per capita expenditures for home care in current dollars are shown in

Figure 5-11. Regions with the highest per capita expenditures are Eastern Kings and West

Prince. The lowest per capita expenditure is for the Queens Region, where most of the secondary

acute care services are delivered. Various factors influence these per capita differences. There is

a higher use of home care by elderly residents of Eastern Kings and West Prince (VanTil, 2003)

and the proportion of elderly residents is higher than in the Queens region. Since most of the

secondary procedures are performed in Queens and the increased emphasis on reducing in-

patient length of stay, early discharge back to the patient’s home may have contributed to higher

per capita home care expenditures for the rural health regions.

V.5 Views of Regional Key Informants: Observations about Resource Allocation

V.5.1 Funding and Budget Methods

Health restructuring in Prince Edward Island used a budget instrument known as

consolidated block funding. According to Denis et al, 1999 it is defined as the sum of previously

separate budgets for various service sectors (i.e. hospitals, addictions, social services, home care,

public health, nursing homes, child welfare, income security, and public housing) that had been

placed under the control of the five health regions. Transfers from the government of Prince

Edward Island to the health regions were based on historical expenditures (Denis et al., 1999).

Following the decentralization of home care, provincial program administrators

continued to be involved in policy and program development as single entry point for long term

care institutional and community-based services was implemented. The health regions delivered

and allocated home care services to clients, while the Ministry continued to develop policy,

provide program oversight, and determine the amount of provincial funding transferred to health

regions. The Prince Edward Island home care budget was not formally protected upon it transfer,

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however observations gleaned from regional key informants suggested that the home care sector

had been closely monitored by Ministry program administrators. The absence of any type of

formal protective mechanism for the home care budget left the sector in a vulnerable position

which, according to Lomas & Rachlis (1996), could have resulted in mixed messages being

communicated to the health regions. On the one hand, the Prince Edward Island government had

made known its strong desire to have regions reallocate resources to augment home and

community-based services; yet, on the other hand, it chose not to formally protect the existing

funding base. The implications of an unprotected home care budget, as predicted by the scope of

conflict theory, are that the health regions could have chosen to reallocate this funding to the

acute care sector, resulting in resources being taken away from home care.

V.5.2 Central Control Versus Local Autonomy

A key tension in moving towards regionalizing health care delivery, according to

Rondeau & Deber (1992), is the extent to which the government can then limit the power of local

authorities. Viewpoints about the tensions that can arise between central government control and

local autonomy through health regions varied among the regional key informants interviewed.

Several stated (as the following quotes illustrate), the ability of regions to make decisions in

practice did not seem as wide reaching as the potential that had been implied in the provincial

health reform policy and planning documents or the legislation. For example,

“because under the old hospital system, up to ’93 here in the province, the hospitals had a fairly high degree of independence. They had their own boards. They were sort of elected at community meetings and that sort of thing. They still do that, but it’s much more government controlled now under the regional system. I mean, the boards, the actual legislation here, the CEOs of each health regions have a duplicate reporting relationship, so if it comes to a crunch decision it’s going to be a political decision, as opposed to a regional decision.”

“it would appear as though there’s not a lot of autonomy in resource allocation decisions.”

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These impressions suggest, albeit indirectly, that the Prince Edward Island government

continued to hold the balance of power, regardless of the rhetoric they used that restructuring of

health care delivery would enhance community and citizen involvement in decision making so

that resources could be redirected in accordance with local needs. Alternatively, other regional

informants expressed the view that regionalization had broken down program-based funding

silos and optimistically inferred that in time, resource re-allocation would happen. As one Prince

Edward Island regional health care leader observed:

“regions have much more control over their resource allocation decisions than would have been experienced in the old system where decisions were being made by people who do not know about the program needs at a frontline.”

Another reinforced this view by saying that regionalization had been successful in forcing a more

integrated and population-based approach to planning,

“I do think in a very long-term way that regionalization has broken down program silos, because instead of looking at an individual program we get to look at the needs of a population.”

Hospital spending in Prince Edward Island was entrenched and the sector had a well

established funding base. Following the implementation of health regions in 1994, they were

immediately faced with deciding what health care services were needed where and how best to

deliver them. There had been government directives and discussions about re-allocating

resources to increase the availability of home care and community-based services but,

nevertheless, the health status of Islanders reinforced the pressing and ever increasing need for

more acute care services coupled with the public interest in acute care. A key concern was the

extent to which the health regions were willing to take on the challenge of breaking the funding

gridlock which had contributed to entrenched spending patterns for hospitals and reallocate

resources to home care. Alternatively, home care was a much less prominent and less powerful

98

health sector given its low share of provincial government health spending. The following quotes

by regional key informants exemplify how the interplay between central control and local

autonomy affected the policy goal of increasing community-based services,

“I would sense that there hasn’t been much change”… In some areas there are some small changes. We do have more resources going into home care. Not huge amounts. And I think we’re pushing with less, even though we’re getting more resources. The resource curve isn’t keeping up with the utilization curve.”

“I would say to a limited extent it changed it…. I think it brought parts of the system together that weren’t there initially…Like there were strong silos or barriers, or whatever you want to call them. And after we got over the initial shock of regionalization I think – I certainly felt the last five years, say from ‘98 to 2002, there was a real coordinated effort, and it was a little bit more flexibility to change the system and reallocate resources.”

According to regional key informants, despite the government regionalizing the delivery of

health care, powerful interests such as physicians continued to be influential health care actors

who exerted pressure on the health regions to maintain the status quo for hospital care as the

following quotes illustrate,

“I think…that there still is the predominance of acute care that’s ... that’s entirely evident. But I think it was, at least in the other sectors, there seemed to be a willingness to allow us to as regional authority administrators, or whatever, to move the dollars around, including people a little bit better than we could under the silo system that we had before.”

“Certainly in the regionalization structure that we have, acute care still holds the power base.”

As illustrated by these impressions of regional key informants and as reinforced in the health

reform literature (Eyles et al., 2001), home care was not a well enough established actor at the

time health restructuring was introduced to effectively challenge and counteract the power of the

acute care sector to which physicians and local residents provided substantial support.

V.5.3 Discussion of Findings

The potential for scope of conflict was high in the Prince Edward Island model of

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regionalization because home care had to compete with a wide range of health care and social

services for funding. At the time regionalization was introduced in 1993/94, the hospital sector

was a much more powerful actor than home care mainly because its share of provincial

government health expenditures was at 52.2% (Appendix A-8), compared with the home care

sectoral share at 1.6% (Figure 5-9).

Two suggestions are provided as to why this increase in the home care share of provincial

government health spending occurred. First, the gain from 1.6% to 2.2%, does indicate that

health regions reallocated resources away from hospitals to home care, albeit with limited

success. The substantial decrease in the hospital sectoral share, and the corresponding small

increase in the home care share, suggests only a small portion of hospital funding was reallocated

to home care. This modest increase could signify health regions were taking a cautious approach

to the reallocation policy agenda, to appease key actors such as physicians and the public, who

favoured acute care. Alternatively, modest and incremental budget increases to home care

funding could also have been transferred to the health regions by program administrators within

the Ministry. Despite the Prince Edward Island government’s explicit commitment to resource

reallocation as expressed in various health reform policy and planning documents, it had not

established targets or outcomes in support of this policy goal. Given the absence of these, along

with the nascent status of the home care sector, and the high level commitment by the public and

physicians to emphasizing acute care beds and community hospitals, it is surprising that resource

reallocation to home care did occur. Because the Prince Edward Island government did not put

any institutional arrangements in place to protect the home care budget, this made home care

even more vulnerable in a regionalized service delivery model.

The results predicted by the scope of conflict theory have been confirmed in the Prince

100

Edward Island case where this case demonstrates less powerful actors can be risk. Placing a less

power actor such as home care in a regionalized environment, did not result in the extent of

reallocation of resources from acute care that health reformers had hoped for. Various reasons

are offered regarding the interpretation of this policy outcome, including the notion that, despite

changing the organization and structure, history matters. Inertia was strong in this case and the

health regions in Prince Edward Island did not appear to be all that interested in reallocating

resources in accordance with provincial health reform goals. Sectoral budgets had been

entrenched well before health reform was introduced, and even after the health regions were

formed, the previous year’s budget for a particular health sector (with the exception of hospitals)

remained one of the most effective ways of predicting resource allocation for the following year.

Lastly, in a regionalized health care delivery environment, wherein this new structure was to be

the mechanism to break down or unfreeze the funding gridlock so resources could be reallocated

to fund more community-based care, powerful actors such as physicians and local residents

continued to emphasize hospital care.

101

Figure 5-1 Government Health Expenditures, Prince E dward Island, 1990/91-2000/01 - Current Dollars; Data Source: CIHI (2004), Table A-1, p.31

0

50

100

150

200

250

300

Year

$'00

0,00

0

PEI 176.5 194 197 208 197.9 204.9 218 213.2 234.4 244.9 263.1

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

Mar/93 Election Liberal majority

Regionalization begins

Nov/96 election PC majority

Apr/00 election PC majority

102

Figure 5-2 Annual Percentage Change in Government H ealth Expenditures, Prince Edward Island, & Canada, 1990/91-2000/01 - Current Dollars ; Data Source: CIHI (2004) Table A-1, p.31

-6

-4

-2

0

2

4

6

8

10

12

PEI 6.7 9.9 1.5 5.6 -4.8 3.5 5.4 -1.3 9.9 4.5 7.4

Canada 7.4 9.1 3.3 -0.4 1 -0.2 0.5 4.7 7 7.9 8.6

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

Mar/93electionLiberalmajority

Regionalizationbegins

Nov/96electionPC majority

Apr/00electionPC majority

103

Figure 5-3 Per Capita Government Health Expenditure s, Prince Edward Island & Canada, 1990/91-2000/01 - Current Dollars; Data Source: CIH I (2004) Table A-2, p.32

0

500

1000

1500

2000

2500

Dol

lars

PEI 1352.87 1488.8 1501.81 1570.64 1479.45 1518.14 1587.66 1565.73 1724.5 1795.02 1928.82

Canada 1553.62 1677.16 1711.58 1685.68 1684.38 1663.9 1694.61 1716.44 1822.33 1950.04 2097.01

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

Regionalization beginsbegins


Mar/93 election Liberal majority


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Figure 5-4 Health as Proportion of Total Government Expenditures (includes debt charges), Prince Edward Island, 1990 /91-2000/01 - Current Dollars

Data Source: CIHI (2004) Table A-5, p.35

0

5

10

15

20

25

30

Per

cent

PEI 23.2 24 23.7 20.4 23.8 24.6 25.3 25.2 26.5 26.1 25.3

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01





105

Figure 5-5 Government Health Expenditure as Percent age of Provincial GDP, Prince Edward Island & Canada, 1990/91-2000/01 - Cu rrent Dollars;


0

1

2

3

4

5

6

7

8

9

Per

cent

PEI 8.1 8.5 8.3 8.4 7.7 7.6 7.7 7.5 7.7 7.6 7.8

Canada 6.3 6.8 6.9 6.6 6.3 6 5.8 5.8 5.9 5.9 6

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01



Regionalizationbegins Apr/00

election PC majority

F

106

Figure 5-6 Prince Edward Island Government Home Car e Expenditures, 1990/91-2000/01 - Constant & Current Dollars;

Data Sources: CIHI (2001) Table 3, p.C-4; CIHI (200 7) Table B.3, p.30

0

1000000

2000000

3000000

4000000

5000000

6000000

7000000

dolla

rs

current 2747000 2941000 3324600 3647100 3398500 4073000 4720600 4640500 4929300 5449300 5862900

constant 3141619 3221320 3532150 3810962 3498642 4152505 4786330 4640500 4858120 5090528 5363978

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

Mar/93 Election Liberal majority


Nov/96 Election PC majority

Apr/00 Election PC majority

107

Figure 5-7 Annual Percentage Change in Government H ome Care Expenditures, Prince Edward Island & Canada, 1990/91-2000/01 Curr ent Dollars

Data Source: CIHI (2001) Table 3, p.C-4

-10

-5

0

5

10

15

20

25

30

35

40

perc

ent

PEI 18.8 7.1 13 9.7 -6.8 19.8 15.9 -1.7 6.2 10.5 7.8

CAN 16.8 18.4 10.5 36.5 10.1 3 5.7 12.6 16.1

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

Mar/93 electionLiberal majority


Nov/96electionPC majority

Apr/00 electionPC majority

108

Figure 5-8 Government Home Care Expenditures, Per C apita, Prince Edward Island & Canada, 1990/91-1998/99 - Co nstant Dollars


0

10

20

30

40

50

60

70

80

90

100

dolla

rs

PEI 24.11 24.72 26.9 28.73 26.09 30.68 35.06 33.87 35.43

CAN 40.1 44.98 47.62 63.25 67.84 68.49 71.26 78.32 88.92

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

Mar/93 electionLiberal majority


Nov/96 electionPC majority


109

Figure 5-9 Home Care Share of Government Health Exp enditures, Prince Edward Island, 1990/91-2000/01 - Current Dollars

Data Sources: CIHI (2001, 2004, 2007)

0

1

2

3

4

5

6

7

8

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

perc

ent

Election Mar/93Liberal


Election Nov/96PC majority

Election Apr/00PC majority

110

Figure 5-10 Prince Edward Island Regional Home Care Expenditures, 1994/95-2000/01 - Current Dollars

Data Sources: Prince Edward Island Ministry of Hea lth & Regional Health Authority Audited Financial Stateme nts

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

dolla

rs

West Prince 576268 643057 904636 973017 1032931 1070136 1192529

East Prince 953057 1076236 1085508 1150222 1299724 1473287

Queens 997675 1351626 1487236 1492803 1647284

Southern Kings 531117 632255 720243 780084 781331 852679 887489

Eastern Kings 446344 512682 545343 540983 673126 804729 769065

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

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Figure 5-11 Per Capita Government Home Care Expendi tures, Prince Edward Island Health Regions & Province, 1990/91-2000/01 - Current Dolla rs

Data Sources: Prince Edward Island Ministry of Hea lth & Regional Health Authority Audited Financial Statements

0.00

20.00

40.00

60.00

80.00

100.00

120.00

dolla

rs

West Prince 39.59 44.21 62.44 67.42 71.86 74.74 83.62

East Prince 29.27 33.00 33.23 35.15 39.66 44.88

Queens 15.35 20.60 22.59 22.58 24.83

Southern Kings 37.22 43.96 50.23 54.57 54.82 60.01 62.66

Eastern Kings 59.57 68.60 73.54 73.52 92.20 111.10 107.02

Prov per cap 22.53 27.30 29.44 26.54 25.04 30.42 33.65 35.22 38.02 42.84 46.01

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

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CHAPTER VI: THE CASE OF NOVA SCOTIA

This chapter presents the findings of a case study of the Nova Scotia regionalization

model. Regions were assigned a narrow range of health services for regional administration.

Home care was not decentralized. The policy context within which Nova Scotia health reform

took place is described. Financial outcomes including per capita and share of provincial

government health spending for home care are reported and compared with hospitals to examine

whether keeping home care centralized resulted in different resource allocation outcomes.

Observations from regional key informant interviews assist in interpreting these findings.

VI.1 The Policy Context

VI.1.1 Geography and Demographic Characteristics

The province of Nova Scotia consists of 54,400 square kilometers; it is the second

smallest land mass size of the 10 Canadian provinces (Nova Scotia Department of Finance,

1994). Nova Scotia is 575 kilometers long and the average width is 130 kilometers. There are

five main geographical areas: the northern coastal belt; the central higher land; the Annapolis

Valley; the South Shore; and Cape Breton, which is mostly highland country interspersed with

lakes, rivers, and valleys. Nova Scotia has two major urban centres: industrial Cape Breton and

the Halifax metro surrounding the city of Halifax which is the provincial capital. The latter is the

largest urban concentration of people east of Quebec City. The province functions as a regional

base for many federal and provincial government departments (Nova Scotia Department of

Finance, 1994).

In 2001, the Nova Scotia population was estimated at 932,400 persons, which represents

3% of the Canadian population (CIHI, 2003; Appendix C-1). Most residents live in close

proximity to the 7500 kilometers of coastline. Approximately 45% of Nova Scotia residents live

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in rural areas, while 55% reside in urban areas (CIHI, 2003). As of 2001, 13.7% of the Nova

Scotia population was over the age of 65 years; this rate is higher than the Canadian proportion

of 12.7% (Appendix C-2).

VI.1.2 Economic Characteristics

The Nova Scotia economy is clustered around natural resources, similar to the economies

of Prince Edward Island and New Brunswick. Government services are a primary employer.

However, government cutbacks prominent during the early to mid 90s contributed to the overall

limited growth of the Nova Scotia economy (Appendix C-3).

In 2000, the average family income was $25,297 (CIHI, 2002). This is about $4500 or

18% lower than the Canadian average of $29,769. The unemployment rate for 2000 was 9.1%

and was slightly higher at 9.7% for 2001 (CIHI, 2002). The Ministry of Health observed that the

lack of economic well-being is a major factor affecting the health of Nova Scotia residents (Nova

Scotia Department of Health, 2002).

VI.1.3 Health Status Indicators

Life expectancy for Nova Scotia residents is 78.8 years, which is slightly below the

Canadian average of 79.5 years (CIHI, 2005). The infant mortality rate is 4.9 per 1000 live births

which is better than the Canadian rate of 5.8 (CIHI, 2002). Disability free life expectancy of 65.5

years, compared with the national average of 68.6 years (CIHI, 2003), indicates that Nova Scotia

has a higher prevalence of disability.

The percentage of Nova Scotia residents who report their health status as very good or

excellent was 59%; this is lower than the Canadian rate of 61.4% (CIHI, 2003). The percentage

of Nova Scotia residents who rate their health as fair/poor was 14%, approximately two

percentage points higher than the Canadian average at 12% (CIHI, 2003). These findings

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indicate Nova Scotians perceive their health status as worse than the average findings for

Canada.

Highlights of the health status of Nova Scotia are described in the government’s

submission to the Romanow Commission on the Future of Health Care in Canada (Nova Scotia

Department of Health, 2002). Nova Scotia has the highest rates in Canada for cancer, high blood

pressure, and respiratory disease mortality. Nova Scotia has the second highest rates of obesity,

lung cancer, diabetes, and high life stress based on personal circumstances. There is higher than

average unemployment and lower economic growth in Nova Scotia. Nova Scotians have a high

level of regular/heavy alcohol use and the province has the highest rate of smokers in Canada at

30%. In particular, residents of Cape Breton have the lowest life expectancy of the 54 major

health regions in Canada. Nova Scotia has the highest rate of child poverty in Canada as

measured by the Market Basket Measure. The average Nova Scotia income is 85% of the

Canadian average (Nova Scotia Department of Health, 2002).

The incidence of chronic diseases in Nova Scotia, coupled with the low socioeconomic

status of residents located outside of the metro area, is of concern to policy makers in the

Ministry of Health (Nova Scotia Department of Health, 2002). Similar to Prince Edward Island,

the Nova Scotia government is challenged from a re-distributive policy perspective to provide

reasonable access to critical hospital and physician-based treatment and diagnostic acute care

services, while at the same time recognizing the need to delivery services that have longer term

implications for disease prevention and health promotion.

VI.1.4 Political Environment

Nova Scotia has a 52 member House of Assembly. There are three mainstream political

parties: Liberal, Progressive Conservative, and the New Democrats. Four provincial elections

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were held between during the course of this policy analysis; 1993, 1996, 1998, and 1999

(Appendix C-4). In 1993, the Liberal Party under Dr. John Savage (a family physician) defeated

the long standing PC government under which health reform planning had initially begun. The

Liberals won again in 1996, and in 1998 the government was reduced to minority status. It was

subsequently defeated in 1999 by the Progressive Conservative party under the leadership of

John Hamm (another family physician).

VI.2 Structure of Nova Scotia Health Care before Regionalization

VI.2.1 Hospitals

Nova Scotia had 36 publicly funded acute care hospitals prior to regionalization, two of

which provided services to specialized populations — the IWK Health Centre (children and

women) and the Nova Scotia Hospital (mental health services). The QE II Health Science Centre

was, and continues to be, the only hospital to deliver tertiary and quaternary specialized care to

adults. All Nova Scotia hospitals were governed by independent, local boards of trustees.

Hospitals were private, not-for-profit providers of acute care services. Hospitals were publicly

funded and monitored through the Health Care Facilities division in the Ministry, however

provision of acute care programs and services was locally decided by hospital administrators and

boards.

VI.2.2 Other Institutions – Nursing Homes

During the early 1990s, government funding for nursing homes and responsibility for this

sector was under the jurisdiction of the Ministry of Community Services. Similar to Prince

Edward Island, a welfare model dominated long term care delivery in that public funding was

available only to those residents in nursing homes who could not afford to pay for their own care.

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VI.2.3 Home Care

Home care was publicly funded on a province-wide basis in 1988 and was known as the

Coordinated Home Care Program (CHCP). At that point, responsibility for home care was under

the jurisdiction of the Ministry of Community Services (Hollander & Walker, 1998). The CHCP

was designed for two special populations: elderly persons over the age of 65 and those with long-

term disabilities (Nova Scotia Department of Health, 1994). Home care nursing, which was a

component of CHCP, was under the jurisdiction of the Health Ministry; however, funding was

determined by the Community Services Ministry.

VI.2.4 Public Health Services

Various public health services were administered under the Community Health Services

division. In addition to policy and program planning, public health services were publicly

delivered using nurses, nutritionists, public health inspectors, etc. who were employed by the

provincial government but worked in decentralized administrative public health units located

throughout Nova Scotia.

VI.2.5 Functions of Nova Scotia Health Ministry The Nova Scotia Ministry of Health had various program divisions which were

responsible for policy development, program planning, and funding for different health sectors

including: health care facilities; community health services (nursing, nutrition, health promotion,

etc.); mental health; drug dependency; and insured services (i.e. physician and out of hospital

drugs) (Nova Scotia Department of Health, 1992). The Ministry monitored the standards for the

delivery of acute care programs.

The functions of the Nova Scotia ministry are similar to what Shah (1998) had outlined;

i.e. funding health care, monitoring standards, and administering regulations and provincial

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payment plans for physicians and drugs, in addition to direct service delivery. In Nova Scotia

centrally located program units and divisions overseeing health care resulted in segregation and

fragmentation of health care services planning and funding prior to introducing health reform

(Crichton et al., 1997).

VI.3 Restructuring Health Care in Nova Scotia

VI.3.1 Rationale and Impetus for Change

As early as 1989, the concept of regionalization had been addressed by the Nova Scotia

Royal Commission on Health Care (1989) which emphasized that creating networks of health

care services could meet the needs of local geographical areas. This Commission concluded the

decentralization of Ministry of Health functions and delegation of authority to health regions was

integral to the effective management and efficient delivery of health care.

Two distinct policy documents describing government preferences for health

restructuring were produced under two different Nova Scotia governments. The first report,

Health Strategies for the Nineties - Managing Better Health was released in 1990 under a PC

government. This initial plan to reform health care in Nova Scotia was framed under a

rhetoric of decentralization where six regional heath authorities would have broad planning responsibilities. In reality, however, the authorities were merely to be advisory to the Ministry of Health; all decision-making authority was to remain at the provincial level... (Hurley et al., 1994, p.500).

The interpretation by the Nova Scotia government was to separate the concepts of

regionalization and decentralization. Regions were to consolidate service delivery, while

decentralization would be considered at a later date (Nova Scotia Department of Health, 1990).

Appendix C-5 provides a chronology of health reform milestones for Nova Scotia.

In 1993, the PC government was defeated by the Liberals. The underlying beliefs of each

government about health reform were different. The newly-elected Liberal government believed

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in policies which improved the health status of the Nova Scotia population in tandem with

gaining control of the province’s critical fiscal situation (Mackin, 1997). The dilemma of the

province’s finances eventually became a key driver in the urgency to restructure health care

delivery. Health regions were viewed by the Liberals as integral actors in rationalizing health

care, including where hospitals should be located and in reducing the number of hospital beds

(Mackin, 1997). Equally important, was a government policy goal to focus on coordination of

health care planning and service delivery since,

before regionalization, Nova Scotia’s health care system consisted of scattered and fragmented programs, management structures, and decision-making processes. Each of the 36 hospitals had its own administrative staff and support systems, and there was no mechanism for the hospitals to work together or to link provincially-run health services such as drug dependency, home care, long-term care, and mental health (Nova Scotia Department of Health, Health Care Update: Regionalization, 1998, p.5).

To further develop the government’s health reform approach, a Ministerial Action

Committee on Health System Reform was formed in January 1994, which became known as the

Blueprint Committee. It was given a very short time frame (about four months) to develop an

action plan to implement the recommendations of Nova Scotia’s Royal Commission. The

committee produced a report known as Blueprint for Health System Reform (1994), which was

yet another attempt to define the philosophy underlying health restructuring and enunciate

reasons why and how the health care system should be reformed. These included: allowing for

effective community input into decision-making about health care resource allocation; improving

the coordination and integration of health services at the community and regional levels;

minimizing administrative and overhead costs in order to put more money toward services and

programs; reducing disparities among regions in the access, availability, cost, and quality of

health care; reducing disparities in health status within and among regions; developing a funding

formula that responds to the health needs of the region; achieving financial savings through

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appropriate economies of scale; reducing duplication of services and undesirable competition.

VI.3.2 Policy Goals and principles Underlying Regionalization

The policy goals described in Blueprint for Health System Reform (1994) specified that

responsibility for health care delivery would be decentralized to health regions so that resources

could be organized and shared among communities and that spending decisions could be locally,

rather than centrally made. The principles underlying health care restructuring included: public

policy must promote good health; health care must be consumer, family and community focused,

not facility and provider driven; individuals must have the right and responsibility to make

choices about their own health; health is a community responsibility; a comprehensive range of

health programs will be provided through a publicly funded, tiered system; the reformed system

will optimize and integrate the capabilities and skills of providers, patients, families, and

volunteers; access to information about health and the health system is essential for effective

decision-making to occur at all levels; ongoing evaluation and outcome measurement will ensure

the reformed health care system achieves value for money; a reallocation of health care resources

is required to improve the health status of Nova Scotians; and people presently employed in the

health system are recognized as a valued resource (Nova Scotia Department of Health, Health

Care Update: Regionalization, 1998). Although not explicitly stated in various Nova Scotia

health reform and planning documents, Flood (1999) maintained the policy focus underlying

regionalization was on reducing health care expenditures by shifting responsibility for decision

making to regions who in turn would control the utilization of hospital beds and decrease the

actual number of hospital beds, rather than having the government make these contentious

decisions.

Reallocating resources across health care sectors was not a prominent theme in any of the

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Nova Scotia health reform documents reviewed (i.e. Towards a New Strategy — Report of Royal

Commission on Health Care (1989); Health Strategies for the Nineties: Managing Better Health

(1990); Nova Scotia’s Blueprint for Health System Reform (1994); and, From Blueprint to

Building: Renovating Nova Scotia’s Health System (1995)).

VI.3.3 Characteristics of Nova Scotia Regionalization Model

VI.3.3.1 Population size

Both the population and geographic size of the four health regions (Central, Eastern,

Northern, and Western) varied widely. There were 33,165 residents in the Northern region (the

smallest in population size) to just under 400,000 residents in the Central region.

VI.3.3.2 Design, governance, and accountability: a legislative framework

The Nova Scotia legislation, the Act to Establish Regional Health Boards, was passed in

1994. Key elements of the legislation are described in Appendix C-6. The following outlines the

roles of the provincial government and regional health organizations.

Nova Scotia was one of the several Canadian provinces to employ a two–tier approach to

the formation of health regions. The first tier consisted of a regional health board which in turn

had the responsibility to develop community health boards throughout the region(CHBs). The

purpose of the CHBs was to engage citizens in health services planning at the local community

level as part of the health reform process and

in turn the region built this information into a regional plan as mandated by the Nova Scotia

Ministry. Flood (1999) observed however, that there was no legislative requirement or any

incentives to ensure regional authorities did in fact take these plans into account as regional

priorities were determined. CHBs were embedded within a community development approach

which promoted local engagement and also accommodated the void created by the dissolution of

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local hospital boards (Lomas, 1997; Flood, 1999). By 1997, 27 of the proposed 38 CHBs had

been formed (Nova Scotia Department of Health, Health Care Update: Regionalization, 1998). A

shortcoming was that the CHB structure was not embedded in the Nova Scotia legislation

(Flood, 1999). The decision to have two levels of boards was deliberate because the Liberal

government believed the Ministry of Health program advisors had been too powerful and the

decisions they made had not reflected local needs (Hurley et al., 1994). By having two tiers of

health planning, there was a clear intent by the government to shift the locus of power away from

the Ministry’s program advisors to health regions and local residents (Hurley et al., 1994). This

decision added to the complexities of the tensions between local autonomy and central

government control.

Another key policy decision affecting regional responsibilities was that four hospitals

remained outside of the regional health boards’ span of control. This was a government decision.

These included the two specialist hospitals mentioned earlier and two other hospitals which

provided tertiary care – the Queen Elizabeth Health Sciences Centre and the Cape Breton Health

Care Complex. Subsequently, all but the IWK were assigned for regional administration during

the next wave of reform in Nova Scotia.

Two province-wide mechanisms were established by the Ministry of Health to support

regionalization. The Provincial Advisory Committee included: Chairpersons of regional health

boards and non-designated organizations, CEOs of health regions, and Ministry personnel. The

purpose was to provide a forum for policy consultation and province-wide planning. A second

structure, the Provincial Leadership Committee included the Chief Executive Officers of the

health regions and non-designated organizations. Its purpose was to address province-wide

clinical and administrative planning, clinical and administrative resource management, and

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health renewal.

The regional boards consisted of 12-16 members. Two-thirds were nominated by the

CHBs and the other third were directly appointed by the Minister of Health (Hurley et al., 1994).

A lengthy list of functions performed by the health regions was included in the legislation;

however it did not elaborate on how the functions of the Nova Scotia Ministry of Health would

change following the decentralization of administrative responsibilities. An overall purpose or

mandate for the newly formed health regions was also not provided. The legislation was also

silent about core health care services or services delivery arrangements. According to Flood

(1999), the legislation did not specify any reporting requirements to which health regions had to

adhere. She viewed this as problematic from an accountability perspective (Flood, 1999). What

this illustrates is the difficulty in trying to manage the trade-offs between local autonomy and

central direction around health reform policy goals.

VI.3.3.3 Regional functions and assignment of services

Similar to the other Canadian provinces, health regions in Nova Scotia were not given

responsibility for physicians and publicly funded, out of hospital drug programs. The Nova

Scotia legislation described the health region functions as: planning, setting priorities, allocating

funds, and managing services ( Appendix C-6). As of January, 1997 the regional health boards

assumed operational responsibility for designated hospitals and mental health services. In April

1997, regional responsibilities were expanded to include public health, drug dependency, and

addiction services.

The Nova Scotia health regions were not assigned responsibility for home care.

According to observations from regional key informants, this decision was embedded in a lack of

trust by the Nova Scotia Ministry program administrators that home care funding would not be

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reallocated elsewhere as characterized by the following quote:

“Looking back I believe that the increasing allocation of money to home care has probably taken place to a greater extent than had it would have been under the regions.”

Regional key informants expressed the view that the Nova Scotia administrators did not trust the

health regions and the Ministry advisors thought regions would not build home care to the extent

the Ministry wanted.

The exclusion of tertiary and specialized hospitals from regional oversight added yet

another layer of complexity to health care planning and delivery (Hurley et al., 1994). These

institutional arrangements implemented by the government raised questions its commitment to

community engagement and participation. Because of this three-way arrangement, there was a

high potential for disjointed and compartmentalized planning. The Nova Scotia model was also

contrary to the Canadian trend where the planning of health services for a geographic area was

being consolidated under a single structure. Given that not one, but three levels had the authority

to plan health care in Nova Scotia, coupled with the exclusion of home care from the basket of

health services administered by regions, the government’s choice of a model reflected a

disjointed approach in order to accommodate the diverse and discordant interests of powerful

provincial health care actors who generally opposed regionalization of health care delivery.

VI.3.3.4 Implementation of regionalization

Four provincial policy and planning documents had been produced by two distinct

governments. They provided recommendations conveying the underlying beliefs about health

reform and how regionalization should be designed and implemented (Report of the Royal

Commission on Health Care (1989); Health Strategies for the Nineties: Managing Better Health

(1990); Nova Scotia’s Blueprint for Health System Reform (1994); and, From Blueprint to

Building: Renovating Nova Scotia’s Health System (1995)). Much of the Nova Scotia debate and

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controversies centered on the design features of health regions such as: the geographical

boundaries and population size, the scope of service responsibilities, funding and budgets, and

whether regional board members should be elected or appointed.

The legislation to implement regionalization was passed in 1994 and the Minister of

Health immediately appointed interim health boards consisting of 16-18 volunteer members who

managed the transition process of implementing the four health regions (Nova Scotia Department

of Health, From Blueprint to Building: Renovating Nova Scotia’s Health System, 1995). It was

not until January 1996 that four health regions — Central, Western, Eastern, and Northern —

were formed, but they did not become operational until hospital services were transferred in

early 1997.

The implementation of regionalization involved numerous political challenges for the

Nova Scotia government. First, the health restructuring agenda was entangled with an

overwhelming need to control government spending (Minister’s Task Force on Regionalized

Health Care in Nova Scotia, 1999). Since regionalization was caught in the cross-fire of bed

reductions and hospital closures which mostly affected small, community hospitals, strong

discontent was evident throughout rural Nova Scotia. During the 1998 provincial election, the

reduction of the Liberal majority to a minority government was largely attributed to this issue as

many residents were furious about the closure of both hospitals and beds and acted out these

frustrations on election day (Mackin, 1997). Following this election, numerous actors continued

to voice concerns about how regionalization was evolving. This subsequently led to the

formation of a Minister’s Task Force to study regionalization in October 1998 which had the

following purpose:

to review and assess the current approach to regionalization in Nova Scotia recognizing that regionalization is very new and put forward recommendations, strategies, and

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options for a regionalized health care delivery system that values local involvement in decision-making and is responsive and accountable to local communities; ensures consistency and coordination between and across communities; has appropriate clearly defined, distinct an mutually supportive role and responsibilities for Community Health Boards, Regional Health Boards, Non-designated organizations. (Minister’s Task Force on Regionalized Health Care in Nova Scotia, 1999)

In July 1999 another provincial election was held. The Liberal minority government was

subsequently defeated by the Progressive Conservatives. This newly formed government

permitted the Liberal-formed Task Force to release its final report in September 1999, although it

was recognized the PC government was not all that interested in profiling the work of the

previous Liberal government. It was clear the PC government had its own health reform agenda

and particular ideas about regionalization since immediately following the release of the Task

Force report, the Minister of Health assumed governance responsibilities of the four health

regions. This move signaled a change in policy direction about regionalization was forthcoming.

Soon thereafter, the government formed nine District Health Authorities. They framed this

restructuring as a way to establish a more community-responsive health care system (Nova

Scotia Ministry of Health, 1999) and the boundaries matched those of the regional hospital

catchment areas.

The time lag between when the Nova Scotia legislation was passed and the

implementation of health regions indicated that regionalization had been a controversial policy

issue for the government. Much confusion and disagreement prevailed amongst health actors as

each held differing positions about how regionalization should be implemented (Flood, 1999).

This caused the pace of health care reform in Nova Scotia to proceed slowly and happen in

small, incremental stages. During the time frame of this study, however, there was stability in the

Nova Scotia model of regionalization in that home care remained under the Ministry of Health’s

control. This consistency enabled these baseline observations about per capita expenditures and

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share of provincial government health spending for home care to be compiled.

From the outset, the Nova Scotia model was not recognized as an instrument to reallocate

resources (which differed from the Prince Edward Island approach described in Chapter V). It

lacked various enabling elements identified in the Canadian health reform literature as necessary

components to accommodate resource reallocation, including block funding/integrated budgets

and responsibility for a broad array of health care services (Lomas, 1997; Flood, 1999; Angus et

al., 1995).

The main policy goal driving the Nova Scotia model was the government’s desire

to use it as a political instrument to gain control of health care spending. They adopted a

citizen-driven approach to rationalize acute services resulting in the closure of hospital

beds, most of which had occurred by the time hospitals were transferred to the regions in 1997.

The logic underpinning the Nova Scotia model was that the health regions would take full

responsibility for cost-cutting decisions, thereby insulating the government from the political

fallout of having made hard-hitting political decisions (Flood, 1999). In reality, however, the

urgency of the province’s fiscal situation forced the Liberal government to act prior to health

regions were fully implemented.

VI.4 Regionalization Results: Analyzing the Impact

Prior to health restructuring, the predominant focus of the Nova Scotia Health Ministry

was on hospital-based acute health care services (Crichton et al., 1997). This focus broadened

when, in the early 1990s, the responsibility for nursing homes and home care was transferred

from Community Services to Health as part of the overall plan to improve the planning and

delivery of health care. Addiction and drug dependency services were administered by a free

standing province-wide organization with its own board of trustees but it was integrated into the

127

Ministry during 1991/92 (Nova Scotia Department of Health, 1992).

VI.4.1 Hospital Funding Delivery and Allocation

Selected indicators for hospitals and the delivery of acute care services are provided in

Tables 6-1 and 6-2. Between 1993 and 2001, the number of acute care beds decreased by 1815 or

38%, and patient days/1000 population declined by 536 days/1000 or 39% (Table 6-1). The

number of acute care beds/1000 population decreased from 5.3 to 3.3 (Table 6-1).

Table 6-1: Nova Scotia hospital data, 1991-2001

Year Hospital Beds

Beds /1000 population

Patient Days / 1000 population

Average length of stay (Days)

1993 4807 5.3 1396 9.4

1994 4262 5.3 1260 9.1

1995 3588 4.6 1089 8.6

1996 3381 3.9 935 7.7

1997 3224 3.6 867 7.6

1998 3231 3.6 917 8.2

1999 3127 3.5 865 7.8

2000 3099 3.4 885 8.3

2001 2992 3.3 860 8.5

Source: Nova Scotia Department of Health Annual Statistical Report, 2000/01

As of 2001, hospitalizations had declined by 21,923 occurrences (19%) and total hospital

days dropped by 82,297 days representing a decrease of 9.7% decrease (Table 6-2). This shift in

acute care utilization patterns suggests alternatives to in-patient hospital care such as home care,

day surgery, and ambulatory care clinics had developed as substitutions for more expensive in-

patient acute care. Despite these decreases, the Nova Scotia length of stay in 2001 was 8.2 days,

still above the Canadian rate of 7.3 days (Table 6-2). This higher length of stay suggests more

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community-based alternatives and greater coordination of existing services such as home care

were still needed in order to maximize effective and efficient use of hospital beds in Nova Scotia

Table 6-2: Selected acute care indicators, Nova Scotia

Selected Acute Care Indicators for Nova Scotia (Canada in parenthesis)

Indicator 1995 2000 2001

Hospitalizations 114,954 97,257 93,031

Age Standardized Hospitalization Rates per 100,000

11,694 (10,942)

9,728 (9,137)

9,273 (8,796)

Total Hospital Days 841,440 780,749 759,143

Average Length of Hospital Stay (in days)

7.3 (7.2)

8.0 (7.2)

8.2 (7.3)

Source: www.cihi.ca/cihiweb/en/media_19nov2003_tab1_e.html; tab2_e.html;tab3_e.html;tab4_html.

VI.4.2 Nursing Home Funding, Delivery, and Allocation

Long-term care residential facilities were transferred to the provincial Health Ministry in

1993. As of April 2002, there were 72 nursing homes in Nova Scotia (5841 beds). These were

operated by both for-profit and not-for-profit providers. The Nova Scotia provincial government,

unlike Prince Edward Island, did not own nursing homes; however, numerous facilities were

owned by Nova Scotia municipal governments.

Nova Scotia was one of the last Canadian provinces to implement single entry access to

continuing care services (Hollander & Walker, 1998). In so doing, all prospective clients

requiring long term care, irrespective of financial status, would undergo both income and asset

testing and assessment of care requirements to ensure there was indeed an unmet need for the

level of care provided by nursing homes (Hollander & Walker, 1998).

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VI.4.3 Home Care Funding, Delivery, and Allocation

Following the transfer of home care to the Health Ministry in 1994, it was redesigned and

emerged as Home Care Nova Scotia (HCNS) (Hollander & Walker, 1998). Major changes

included expanding the range of professional and home support services and delivering services

to a wider range of clients. HCNS had the mandate to provide services in line with the three

home care functions identified in the Health Canada Report on Home Care (i.e. substitution

function, maintenance function, and preventive function) (Nova Scotia Department of Health,

1994). Throughout this study, home care clients were required to pay a user fee for home support

services. Nursing and personal care services delivered by licensed providers (i.e. RNs and LPNs)

are publicly funded (Health Infostructure Atlantic, 2002).

Home care was not part of the basket of health services assigned for regional

administration with funding decisions, program management, delivery and development of

policies and procedures continued to be centrally managed by administrators and program

specialists employed in the Ministry of Health. The province was divided into home care service

delivery units which were coterminous with the boundaries for the health regions. Access to

home care was through referral to locally-based care coordinators. Eligibility for admission was

based on an assessment of a client’s functionality, diagnosis, medical stability, and access to a

physician as determined by care coordinators who conducted in-home or in-hospital assessments

(Health Infostructure Atlantic, 2002).

Home care services were delivered by a combination of public or provincial government

employees and private, not-for-profit service providers. The care coordinators and supervisors

and in some regions in-home nursing and personal support services were provided by

government-employed nurses. Elsewhere, not-for-profit agencies such as the Victorian Order of

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Nurses, the Red Cross, or free standing home support agencies (previously developed by Nova

Scotia municipalities during the 1980s) had contracts with HCNS to deliver a range of in-home

nursing, personal care, and home support services. These not-for-profit agencies are governed by

independent volunteer boards.

Table 6-3: Home care Nova Scotia utilization data, 1995/96-2000/01

Caseload Chronic Admissions Acute Admissions

1995/96 15329 7844 (51% of caseload) 555 (4% of caseload)






Source: Nova Scotia Department of Health, Annual Statistical Report, 2000/01.

Utilization data is not available for 1990/91 through to 1994/95. Table 6-3 illustrates the

use of home care services between 1995/96 and 2000/01 and shows an increase in 6669 cases

(44%). The proportion of admissions to acute home care grew from 4% in 1995/96 to 9% in

2000/01 at the same time as there was a decrease in the proportion of chronic home care

admissions (from 51% in 1995/96 to 37% in 2000/01).

VI.4.4 Provincial Government Health Care Expenditures

In 1990/91, Nova Scotia provincial government health expenditures (current dollars)

were $1.282 billion and increased by 40% to $1.788 billion in 2000/01(Figure 6-1). As seen in

the early 1990s (Figure 6-2) there was a decrease in health spending. These cuts preceded the

implementation of regionalization in 1996/97, which complicated the ability to reallocate

resources. Even though there was a big increase in 97/98, the Liberal majority government was

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reduced to minority government status.

Per capita provincial government health expenditures for Nova Scotia ranged from

$1407.23 in 1990/91 to $1913.70 in 2000/01 (Figure 6-3). Over the 11 year time period, Nova

Scotia spent almost $150 less per capita than the Canadian average.

In 2000/01, Nova Scotia provincial government health spending accounted for 30.9% of

total provincial government expenditures, including debt charges (Figure 6-4) which is higher

than it was in 1990/91, at 27.8%. At the time regionalization was implemented in 1997, the

percentage was 26.7%, compared with 25.3% in the year prior to regionalization, and 32% in the

year following. Despite introduction of health restructuring coupled with the government’s focus

on cost containment, the proportion of provincial spending on health care continued to increase.

In 2000/01, provincial government health spending as a percentage of the provincial GDP

was at 7.1%, compared with the Canadian rate of 6% (Figure 6-5). The Nova Scotia proportion

was consistently about 1% above the Canadian average. This percentage was slightly higher in

the years following regionalization. However, from 1994/95 through to 1996/97, the percentages

decreased to 6.7%, 6.8%, and 6.7%, which suggest that cuts to health care had been made by the

government before the health regions were implemented in 1997.

VI.4.5 Provincial Government Home Care Expenditures

Publicly funded home care expenditures for Nova Scotia include payments for client

services (i.e. nursing, home support) as well as administration costs (case management,

supervision) (Ballinger, et al., 2001). Provincial government home care expenditures (constant

dollars) increased by 323% between 1990/91 and 2000/01 ( Figure 6-6). This significant growth

is indicative of the political commitment the Liberal government made to building the funding

base for home care following its election in 1993 (Mackin, 1997). As noted earlier, this

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substantial infusion of resources was essential in order for Nova Scotia (which was the last

Canadian province to develop a comprehensive home care program) to expand both acute and

chronic services (Hollander & Walker, 1998).

Each year between 1990/91 and 1999/00 showed an increase in public home care

expenditures (Figure 6-7). During four of the 11 years, Nova Scotia had higher annual

percentage gains for home care than the Canadian average increases.

Provincial government per capita home care expenditures (constant dollars) increased by

260% between 1990/91 and 1998/99 compared with an increase of 121% for the Canadian

average per capita. The per capita expenditure was $22.84 (when home care was still under the

jurisdiction of the Community Services Ministry) and by 1998/99 it had reached $82.32 (Figure

6-8). Figure 6-8 compares the per capita spending for Nova Scotia and for Canada and shows the

gap is decreasing over time. During the first few years, the difference was substantial in that the

per capita for Nova Scotia was lower by about $17.24. By 1998/99 this gap had closed to a

difference of. CIHI (2007) reported that by 2003/02 Nova Scotia had one of the highest home

care expenditures per capita at $105.25. This finding level demonstrates the significant

investment the Nova Scotia government made in the home care sector from the mid 1990s

onwards as part of its health reform agenda. By maintaining central control of the provincial

home care budget, the government was also assured the funding they allocated would indeed be

spent on home care (Flood, 1999, Mackin, 1997).

VI.4.6 Home Care and Hospital Resource Reallocation

The hospital share of provincial government health spending decreased by 8.8% from

58.8% in 1990/91 to 50.0% in 2000/01 (Appendix A-8). The first decrease occurred in 1993/94

and continued through to 1997/98, (the year following the introduction of health regions) when

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the prior decreases to the hospital sector seem to have reversed. Despite the early cuts to hospital

spending by the government, once the administration of hospitals was assigned to the health

regions, the decreases in spending continued. These findings suggest the health regions

continued to rationalize acute care services based on local needs and safe clinical practices.

The home care share of provincial government health expenditures was at 1.4% in

1990/91, at a time when the sector was under the jurisdiction of Community Services (Figure 6-

9). It was subsequently transferred to the Health Ministry. Following this, the share increased to

3.8% in 1995/96, to 4.3% in 1996/97, and then reached 5.4% in 2000/01 (Appendix A-8). This

four percentage point gain over an 11-year time frame exemplifies the Nova Scotia government’s

policy goal of increasing funding to the home care sector. The Nova Scotia share of 5.4% as of

2000/01 was slightly higher than the Canadian average of 4.2% in 2003/04 (CIHI, 2007).

Nevertheless, the length of stay for acute care in Nova Scotia remained at 8.2 days in

2001, compared with the Canadian rate of 7.3 days (Table 6-1). The Nova Scotia standardized

utilization rate per 1000 population for home care was 26.1 users/1000 in 2003, which is about

the same as the Canadian average (CIHI, 2007). Judging from these numbers, the increases in the

home care share of provincial government health spending does not appear to have been directed

towards substituting for in-patient acute care. The data in Table 6-3 shows there was a 45%

increase in the HCNS caseload between 1995/96 and 2000/01 in addition to an increase in the

share of acute care home care admissions and a corresponding decrease in chronic admissions.

Despite the view by the Nova Scotia government that home care had an important role to play in

the delivery of health care, and it was an economical alternative to hospitalization, it does not

appear HCNS directed all of these additional funding to home care services that substitute for in-

patient acute care. Given the different groups served by home care, there is no good data about

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whether the additional funding increases we have observed are funding acute care substitution,

long term care substitution, or preventive maintenance home care.

VI.4.7 Regional Home Care Expenditures

Figure 6-10 illustrates the allocation of regional home care expenditures as determined by

program administrators in the Health Ministry. Per capita home care spending varies across the

health regions (Figure 6-11). The Eastern region consistently had the highest per capita spending

from 1994/95 through 2000/01 ranging from $62.44 to $136.31. This region consists of a large

urban area surrounding the city of Sydney as well as rural and remote areas. The challenge of

providing home care to residents throughout the extensive rural and remote areas of the Eastern

health region (more specifically Cape Breton Island) is why the costs are higher. The per capita

spending is lowest in the Central region where it ranged from $29.53 to $90.97. This region also

has a mix of urban and rural areas, but the Eastern region has a higher proportion of elderly

residents, which is another factor that influences home care costs.

VI.5 Views of Regional Key Informants: Observations about Resource Allocation

VI.5.1 Funding and Budget Methods

The Nova Scotia health reform planning documents did not use budget terminology such

as a global budget or an integrated budget. The funding approach used to transfer money from

the province of Nova Scotia to the health regions was based on historical expenditures (Denis et

al., 1999). The regions in turn, used a program based budget arrangement (Denis et al., 1999).

More specifically,

the budget for acute care programs (hospitals) was portable which means it was unprotected and can be reallocated, while the budget for mental health, public health, and addiction services was non-portable which meant the budget can only be spent on each service area respectively (Regionalization of Health Care Systems in Canada - An Overview, 1997, p.55).

135

According to regional key informants, non-portable budgets protect aspects of regional funding

for specified health sectors but restrict the decision-making ability of health regions because:

“we get globally funded and it [the budget] comes in two bundles; the portable and non-portable [budgets]. And sometimes, you know, there’s some shift of things that move from non-portable into portable. And mental health is one that... is starting to migrate. But, then other things still are earmarked solely for its purpose”.

As the following quote illustrates:

“We can manage those resources as long as we don’t do anything that is politically not expedient. And we’re very comfortable with that and accept that in a very political environment where we tend to be highly visible, and anything we do that’s at all controversial we can expect to land up either in the house, or on the front pages. We accept that as our reality. But I think there are some examples still where the range needs to be, at the very least, loosened a bit.”

The continued use of non-portable budgets, once the responsibility for health care had shifted to

the health regions, was viewed by regional key informants as evidence of mistrust between

program administrators within the Nova Scotia Ministry and the health regions.

VI.5.2 Central Control Versus Local Autonomy

Since the health regions administered only hospitals and mental health initially, coupled

with the instrument of non-portable budgets, these institutional arrangements were seen as

barriers by regions who were interested in exploring resource reallocation as one way of

integrating health care. The following quotes portray regional perspectives about the extent of

power the Nova Scotia ministry continued to hold despite the health reform rhetoric which

inferred regions would gain more control over how resources could be used to meet local needs:

“theoretically, the allocation of those resources are ours to answer for. Along with the impact in terms of quality of care. But the cold reality is in many cases our hands are tied.” “when you have some players around in the system for a long time, and they’re working in a certain way, then it’s sometimes hard to truly understand and adopt the new way.”

136

“I think in fact we see more micro management at the [provincial] departmental level than is appropriate or consistent with what they define as their role.”

Accordingly, regional decision makers have highlighted some limitations they experienced as

health restructuring in Nova Scotia unfolded. The arrangements used by the Nova Scotia

ministry clearly reinforced central control over how resources could be used and indeed were

seen as contributing to the tension between the ministry and the local health regions, regardless

of what responsibilities for service delivery had been assigned to the health regions.

Much seemed to remain as it was prior to the introduction of health reform in Nova

Scotia since the use of nonportable budgets protected certain health sectors such as mental health

and public health. This institutional arrangement was seen by the regions as impeding their

abilities to redesign service delivery, while at the same time continuing to reinforce the power of

ministry program administrators. This situation exemplifies how tensions between central control

exercised by the Ministry and local autonomy of the regions developed, despite the

implementation of structures such as regionalization to facilitate change.

Various Nova Scotia regional key informants discussed their perceptions about the lack

of trust which existed within the Nova Scotia Ministry regarding their abilities to advance the

home care sector. Because of the very small portion of resources devoted to home care prior to

its transfer to Health, it was viewed as a vulnerable sector in need of budget protection in order

to build its funding base and become established as a robust sector. The Nova Scotia public was

captivated with hospital beds and expressed great displeasure when bed reductions occurred as

part of the health reform process. The Nova Scotia government’s awareness of these issues was

seen as being instrumental in its decision to maintain central control of home care.

VI.5.3 Discussion of Findings

Implementation of health care restructuring moved slowly in Nova Scotia; this situation

137

is attributed to the persistent resistance exercised by various powerful actors who opposed health

restructuring (i.e. physicians and unions as well as the general public). At the time

regionalization was introduced, the hospital sector was a powerful actor because its share of

provincial government health expenditures was 53.7% (Appendix A-8). Over the course of this

policy analysis, the hospital share decreased to 50%, while the home care share increased to

5.4% (Figure 6-9).

Central control of home care resulted in the assurance the resources targeted by the

provincial government were indeed spent on home care, since its expansion was politically

motivated. The implementation of this policy direction was strongly supported and managed by

Ministry-based home care program advisors and administrators. Because of the high level of

political importance assigned to expanding the funding base for home care, it was the beneficiary

of re-distributive policy making as funding was re-allocated at the provincial level, mainly as a

consequence of corresponding decreases in the hospital share of government health spending.

Decision-making, planning, and efficient delivery of health care by the Nova Scotia

health regions was encumbered by various institutional arrangements. First, the government

assigned a narrow range of health care services for which health regions were responsible. The

scope of conflict, as defined by the structure of the regions, was smaller given the limited

number of services assigned which also had to contend with protected budgets. Second, two

layers of governance (a region board and community health boards) were involved in planning.

Third, tertiary and specialized hospitals were excluded from regional administration. These

created fragmentation and complicated health restructuring which placed constraints on local

decision-making while reinforcing central control. Finally, non-portable budgets were used to

protect vulnerable and weak health sectors such as mental health and prohibited regions from

138

reallocating resources away from these sectors. The potential for conflict among sectors at the

regional level was constrained given the small number of health services assigned, the absence of

responsibility for tertiary level acute care hospitals, and protected budgets. The limited regional

responsibilities, in tandem with the Ministry’s protectionist manner towards certain health

sectors including home care, reinforced central control by the Ministry and challenged local

autonomy.

Politicians and program administrators within the Nova Scotia Ministry of Health

rationalized the central management of home care because of its weak status and limited resource

base at the time health reform was introduced. Prior to its transfer to the Health Ministry from

Community Services, the home care share of provincial government health spending was small.

Because it was underdeveloped as a sector, if home care had been assigned to the health regions,

the planned increases centrally allocated by the government could well have been under threat

and indeed shifted to hospitals. Instead, the Nova Scotia government maintained central control

and mitigated fears of program administrators that resources would be at risk of being

cannibalized by hospitals. Regional key informants confirmed this position, while reinforcing the

regional view that a major focus of the health reform agenda from their perspective, was about

how regions could maintain the status quo by continuing to fund hospital-based services. Key

actors including physicians and local citizens clearly wanted the level of acute care resources to

remain at the same levels as they had been historically funded at. This dilemma of how to re-

balance resources, while growing the home care sector, exemplifies how tensions between

central government control and local autonomy can arise and how structures and budget

arrangements can exacerbate these conflicts.

139

Figure 6-1 Government Health Expenditures, Nova Sco tia, 1990/91-2000/01 - Current Dollars; Data Source: CIHI (2004) Table A -1, p.31

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Year

$'00

0,00

0

NS 1282.2 1351 1358.7 1311 1269.9 1313.5 1319.1 1629.6 1665.1 1785.4 1788.4

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

May/93 electionLiberal majority

Sept/96electionLiberal majority


Mar/98electionLiberal minority

July/99electionPCmajority

140

Figure 6-2 Annual Percentage Change in Government H ealth Expenditures, Nova Scotia & Canada, 1990/91-2000/01 - Current Dol lars


-5

0

5

10

15

20

25

NS 6.2 5.4 0.6 -3.5 -3.1 3.4 0.4 23.5 2.2 7.2 0.2

Canada 7.4 9.1 3.3 -0.4 1 -0.2 0.5 4.7 7 7.9 8.6

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

May/93 electionLiberalmajority



Mar/98 electionLiberalminority


141

Figure 6-3 Per Capita Government Health Expenditure s, Nova Scotia & Canada, 1990/91-2000/01 - Current Dollars; Data Source: CIH I (2004) Table A-2, p.32

0

500

1000

1500

2000

2500

Dol

lars

NS 1407.23 1473.24 1474.06 1415.85 1368.57 1412.21 1414.81 1745.97 1785.01 1907.46 1913.7

Canada 1553.62 1677.16 1711.58 1685.68 1684.38 1663.9 1694.61 1716.44 1822.33 1950.04 2097.01

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01


Sept/96 electionLiberalmajority

Mar/98electionLiberalminority


July/99 electionPC majority

142

Figure 6-4 Health as Proportion of Total Government Expenditures (includes debt charges), Nova Scotia, 1990/91-2000/ 01 - Current Dollars


0

5

10

15

20

25

30

35

Per

cent

NS 27.8 28.4 25.7 26.6 25.3 25.3 26.7 32 30.4 30.8 30.9

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01


Sept/96 electionLiberal majority



July/99 electionPC majority

143

Figure 6-5 Government Health Expenditure as Percent age of Provincial GDP, Nova Scotia & Canada, 1990/91-2000/01 - Current Dol lars;


0

1

2

3

4

5

6

7

8

9

Per

cent

NS 7.5 7.6 7.5 7.1 6.7 6.8 6.7 7.9 7.6 7.6 7.1

Canada 6.3 6.8 6.9 6.6 6.3 6 5.8 5.8 5.9 5.9 6

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

May/93electionLiberal majority





144

Figure 6-6 Nova Scotia Government Home Care Expendi tures, 1990/91-2000/01 - Constant & Current Dollars; Data Sources: CIHI (200 1) Table 3, p.C-4; CIHI (2007) Table B.3,

p.30

0

20000000

40000000

60000000

80000000

100000000

120000000

dolla

rs

current 18194400 18493100 17970200 20074400 22721700 50021900 57065600 60743900 74588500 90828600 96134900

constant 20808110 20255762 19092058 20976330 23165227 50998333 57065600 59866758 72223224 84848626 87954012

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01




Mar/98 electionLiberal minority

July/99 electionPC Majority

145

Figure 6-7 Annual Percentage Change in Government H ome Care Expenditures, Nova Scotia & Canada, 1990/91-2000/01 - Current Dol lars;


-20

0

20

40

60

80

100

120

140

perc

ent

NS 45.6 1.6 -2.8 11.7 11.4 120.2 14.1 6.4 22.8 21.8 5.8

CAN 16.8 18.4 10.5 36.5 10.1 3 5.7 12.6 16.1

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

May/93 electionLiberal majority Sept/96 election

Liberal majority




146

Figure 6-8 Government Home Care Expenditures, Per C apita, Nova Scotia & Canada, 1990/91-1998/99 - Constant Dollars; Data Source: CI HI (2001) Table 4, p.C-5

0

10

20

30

40

50

60

70

80

90

100

dolla

rs

NS 22.84 22.09 20.72 22.66 24.82 54.85 64.35 67.97 82.32

CAN 40.1 44.98 47.62 63.25 67.84 68.49 71.26 78.32 88.92

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01






147

Figure 6-9 Home Care Share of Government Health Exp enditures, Nova Scotia, 1990/91-2000/01 - Current Dollars


0

1

2

3

4

5

6

7

8

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

year

perc

ent

May/93 electionLiberal majoritymajority



Mar/98 electionLibeal minority

July/99electionPC majority

148

Figure 6-10 Nova Scotia Regional Home Care Expendit ures, 1993/94-2000/01 - Current DollarsData Source: Home Care Nova Scotia

0

5,000,000

10,000,000

15,000,000

20,000,000

25,000,000

30,000,000

35,000,000

40,000,000

dolla

rs

Western 9645000 9645000 10139000 10975000 15554000 19059000 20767000

Central 9112000 11211000 11211000 15312000 16531000 26028000 34988000 36359000

Northern 5788000 5788000 8072000 8535000 12345000 14467000 16713000

Eastern 10616000 10616000 12408000 12906000 18952000 21468000 21439000

93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

149

Figure 6-11 Per Capita Government Home Care Expendi tures, HCNS Regions & Province 1992/93-2000/01 - Current Dollars

Data source: Home Care Nova Scotia

0.00

20.00

40.00

60.00

80.00

100.00

120.00

140.00

160.00

dolla

rs

Western 46.72 46.75 49.32 53.59 76.22 93.74 102.52

Central 24.17 29.53 29.31 39.68 42.46 66.26 88.30 90.97

Northern 38.47 38.50 53.83 57.06 82.74 97.20 112.58

Eastern 62.44 62.75 74.39 78.49 116.96 134.46 136.31

Prov per cap 13.46 14.40 23.26 53.49 62.78 66.59 81.85 99.76 106.03

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

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CHAPTER VII: THE CASE OF NEW BRUNSWICK This chapter presents the findings of a case study of the New Brunswick regionalization

model. The health reforms introduced by the government were initially focused on restructuring

the delivery of acute care services. Several years later, in 1996, home care was assigned to the

health regions. The policy context within which health care restructuring took place is described.

Financial outcomes including per capita and share of provincial government health spending for

home care are reported on and compared with hospitals to examine whether or not resources

were re-allocated from the acute care sector to home care. Observations from key informant

interviews assist in interpreting these findings.

VII.1 The Policy Context

VII.1.1 Geography and Demographic Characteristics

The province of New Brunswick has the largest land mass (28,354 square miles) of the

three provinces. It is primarily a rural province with three large urban population centres: Saint

John, Moncton, and Fredericton (the provincial capital).

New Brunswick had a population of approximately 749,900 residents in 2001, which

represents about 2.4% of the Canadian population (CIHI, 2003, Appendix D-1). As of 2001,

13.3% of the New Brunswick population was over the age of 65 years which is slightly higher

than the Canadian rate at 12.7% (Appendix D-2).

New Brunswick is the only official bilingual province in Canada. About 35% of the

provincial population is Francophone and 65% are Anglophone (Reamy, 1995). Most of the

Anglophone population live in the southern part, while the northern part and the Moncton area

are predominantly Francophone.

151

VII.1.2 Economic Characteristics

The New Brunswick economy is centered on non-renewable natural resources including

forestry, mining, and fishing. The growth of the GDP in current dollars has increased between

1990/91 and 2000/01 (CIHI, 2003; Appendix D-3).

In 2000, the average family income in New Brunswick was $24,091 (CIHI, 2002). This is

about $5,600 or 24% below the Canadian average annual income of $29,769. During 2000 and

2001, the unemployment rate was 10.0% and 11.2% respectively (CIHI, 2002).

VII.1.3 Health Status Indicators

The 2001 life expectancy for New Brunswick residents was 79 years, which is almost

equivalent to the Canadian average of 79.5 years (CIHI, 2005). The 1996 infant mortality rate at

5.1 per 1000 live births is slightly lower than the Canadian rate of 5.8 (CIHI, 2002). Disability

free life expectancy (or the years of life lived before developing a moderate or severe disability)

in 1996 was 66.6 years, which is lower than the Canadian average of 68.6 years (CIHI, 2003).

The percentage of New Brunswick residents who report their health status as very good

or excellent was 55%; this is lower than the Canadian average of 61.4% (CIHI, 2003). The

percentage of New Brunswick residents who rate their health as fair/poor was 16.0%, which is

higher than the Canadian average of 12.4% (CIHI, 2003). Taken together, these indicators

suggest the health status of New Brunswick residents is worse than the Canadian average.

Highlights about the health status of New Brunswick residents were reported in the New

Brunswick Health Care Report Card, (2003). The province’s performance on low birth weight

and infant mortality rate is better than the Canadian rates. However, New Brunswick residents

are less physically active. Unintentional injury and suicide among young men are significant

health problems. Survival rates for various cancers such as lung and colorectal were below the

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Canadian average. Survival rates for prostate and breast are similar to the Canadian rates. Almost

95% of New Brunswick residents have access to a family physician and have access to home

care.

Overall, the residents of New Brunswick are less healthy than other regions within

Canada, which is also true for Nova Scotia and Prince Edward Island. The health status of its

residents presents challenges for the New Brunswick government because of both the need for

diagnostic and treatment for acute and chronic diseases along side health promotion and disease

prevention programs. A declining economic position and increasing provincial debt and deficits

creates resource allocation challenges between funding medically necessary services and funding

more community-based care involving disease prevention and health promotion services. Similar

to Prince Edward Island and Nova Scotia, the province heavily relies on federal transfers to fund

social programs (Crichton et al., 1995).

VII.1.4 Political Environment

New Brunswick has a 55-member Legislative Assembly. There are three

mainstream political parties: the Liberals, the Progressive Conservatives, and the New

Democratic Party. There were three provincial elections over the course of this policy

study: 1991, 1995, and 1999 ( Appendix D-4). In the early years of health reform,

New Brunswick citizens were governed by two successive Liberal governments elected

in 1991 and 1995 under the leadership of Premier Frank McKenna. However, this three-term

Liberal government was eventually defeated in 1999, and Bernard Lord formed a

PC majority government. Recently, the Lord government was defeated by the Liberals.

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VII.2 Structure of New Brunswick Health Care before Regionalization

VII.2.1 Hospitals

Prior to the development of population-based health regions, hospitals had independent

boards consisting of provincial and local/municipal appointees. These boards had considerable

operational authority and

efforts to produce regional and provincial planning were often viewed warily and sometimes openly opposed. Duplication of effort and overlap were common features of the system (King, 1996).

The Ministry of Health and Community Services exercised regulatory control over New

Brunswick hospitals, despite this locally-based governance model. The funding allocation for

each hospital was determined by a central program division. There were 51 hospitals in New

Brunswick as of 1991.

VII.2.2 Other Institutions – Nursing Homes

Continuing care most often refers to long-term health care services including nursing

homes and home care (Hollander & Walker, 1998). A major review of nursing homes and

residential long-term care services was completed in 1993, which culminated with a policy

document, Long-term Care Strategy. It outlined a vision for a more inclusive, coordinated, and

client-centered residential care system. Similar to Prince Edward Island, and Nova Scotia, a

welfare model dominated long term care delivery in that public funding was available only to

those residents in nursing homes who could not afford to pay for their own care.

VII.2.3 Home Care

Public funding of home care in New Brunswick began in 1979 when the free-standing

Extra-Mural Program (formerly the Extra-Mural Hospital) was implemented. It was governed by

an independent board of trustees with a mandate to: provide an alternative to hospital

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admissions; facilitate early discharge from hospitals; provide an alternative to, or postponement

of, admission to nursing homes; provide long-term care; provide rehabilitation services; provide

palliative care, and facilitate the coordination and provision of support services (New Brunswick

Health and Wellness, 2003). The EMP delivers acute care substitution home care, one of three

types of home care defined in a Health Canada (1990) Report on Home Care.

Chronic home care is funded and delivered through the Family and Community Services

Division located in the health ministry. This home care program has always been

administratively separated from the EMP. Accordingly, administration and delivery of home care

in New Brunswick is fragmented rather than being a comprehensive, integrated program,

(Hollander & Walker, 1998).

Home care services through the EMP are available on a 365 day, 24-hour-a-day basis.

Core in-home services either substitute for hospital admission or shorten the length of hospital

stay. There is also a home oxygen program and rehabilitative services which are provided to

individuals in a variety of settings, including nursing homes and schools, as well as at homes and

communities.

All residents of New Brunswick are eligible for EMP services, whereas chronic home care

follows a welfare-based approach in that clients pay user fees for home support services. There

are no user fees for home health care services provided under the EMP, however clients may pay

for home support based on the length of time for which these services are required. EMP clients

must have an identifiable health care/functional need that can be addressed by the program; the

need must require the provision of health care services in the person’s natural environment, and

the home environment must be suitable for care/services to be provided there.

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VII.2.4 Public Health Services

Public health services were locally provided by public health professions such as physicians,

nurses, nutritionists, etc employed by the Health ministry. Local health units were located

throughout New Brunswick. Medical officers of Health operationalize provincially developed

policies and regulations.

VII.2.5 Functions of New Brunswick Health Ministry New Brunswick had a combined Ministry of Health and Community Services during the

time preceding and immediately following the introduction of health reform. This large ministry

consisted of various program divisions which, as Shah (1998) describes, had responsibility for

financing, administering standards for different health care sectors and community-based

services, and in some instances, direct service delivery. These divisions had responsibilities for

different health sectoral programs including but not limited to: physicians, public health, disease

prevention and health promotion, addictions, hospitals, drugs, nursing homes, home care (EMP

and Chronic program), and mental health in addition to social and family-oriented services such

as social assistance, child protection, services to persons with mental and physical disabilities,

and chronic home care. Each program division had its own director, program and policy

advisors, planning responsibilities, and budget development and monitoring. Similar to Prince

Edward Island and Nova Scotia, these assorted divisions with distinct responsibilities for health

sector programs has resulted in a fragmented approach to the planning and funding of health care

services. These program divisions, although centrally located, for the most part operated as

independent (Crichton et al., 1995). As well as being segregated, Crichton et al. (1995) identified

that centrally controlled planning approaches often resulted in the creation of similar and

uniform services responses in order that the regional services would not be dissimilar.

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VII.3 Restructuring Health Care in New Brunswick

VII.3.1 Rationale and Impetus for Change

The focus of the New Brunswick government was on rationalizing hospitals along with

some decentralization of authority. These positions were highlighted in the 1989 Report of

Commission on Selected Health Care Programs known as the McKelvey-Levesque Commission.

Major recommendations included: organizing and planning health services; controlling physician

supply; rationalizing hospital beds; providing medical services in a regional framework; and

developing the further involvement of physicians in management. Subsequently, in March 1992

a comprehensive reform of hospitals was announced which combined elements of

regionalization and decentralization. Appendix D-5 provides a chronology of health reform

milestones for New Brunswick.

According to Reamy (1995), there were a number of factors leading to the design of the

regionalization model implemented by the New Brunswick government. It was an administrative

reform of the hospital sector which did not necessarily result in decentralization of power (King,

1996). First, the government wanted to achieve a goal of five hospital beds per 1000 population.

Second, independently governed hospital boards were competing with each other and

accordingly, acute care services were duplicated throughout the province resulting in higher

expenditures and inefficient delivery. Russell King, a former Minister of Health during the early

days of health reform in New Brunswick provided the following comment about this dilemma

during a 1996 conference about regionalization:

Hospitals tended towards turf protection. Efforts to produce better regional and provincial planning were often viewed warily and sometimes openly opposed. Duplication and

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overlap was a common feature. As the fiscal realities became more difficult, it became clearer that a fundamental restructuring of the entire system was necessary in order to improve efficiency and effectiveness of the health system (1996, p.112).

Third, and equally important, was the province’s economic situation, which was not favourable,

as previously described in VII.1.2.

These three driving forces, coupled with the challenge of controlling the ever-rising costs

of publicly funded health care, set the stage for health reform in New Brunswick. The

government’s restructuring proposal was substantiated by earlier suggestions and

recommendations from federal and provincial studies dating as far back as the late 1960s. These

reports had argued that regionalization as a reform tactic had benefits that could improve health

care planning and increase the efficiency of health care delivery, in addition to containing costs.

VII.3.2 Policy Goals and Principles Underlying Regionalization

Following the New Brunswick McKelvey/Levesque Report of Commission on Selected

Health Care Programs (1989), the Liberal government established a committee of inquiry within

the Ministry of Health and Community Services to examine the recommendations for selected

health care programs. This committee produced two health reform policy reports: a vision

document — Towards a Comprehensive Health Strategy which was completed in 1990, and a

planning and implementation document — A Health and Community Services Plan for New

Brunswick which was completed in 1992. This latter policy document proposed that more

attention must be paid to health promotion and disease prevention and situated this proposal with

a continuum of care from wellness to illness. Strategies underlying health restructuring in New

Brunswick were: consistent regional planning; better management of the hospital sector,

including the development of more outpatient clinics and the Extra-Mural Hospital; improved

ambulance services; reductions in the prescription drug program; reconsideration of ways to

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reduce the costs of Medicare; allocating more of the health budget to public health for health

promotion activities; developing family and community services; and better planning for use of

professional services (Crichton et al., 1997). The principles underlying health reform in New

Brunswick included: self-sufficiency or personal responsibility for one’s health; appropriateness;

quality; effectiveness; functionality and efficiency; system co-ordination; system simplification;

selectivity; equity; and regionalization (Crichton et al., 1997).

The consolidation of governance for previously independently run hospitals, through

centralizing it at a regional level, stripped away a great deal of power from local communities

(Reamy, 1995). This approach placed most of the decision-making authority into the hands of

provincial policy and program administrators. It follows that given this approach, the New

Brunswick government’s main policy goal underlying health reform was to maximize

administrative efficiencies whereby health regions would rationalize both the location of hospital

beds and acute care services. King (1996) justified this regionalization model by making the

following observations about its benefits: 1) it facilitated management and target setting; 2) it

enabled New Brunswick to decentralize in a way that was impossible with competitive board

structures at every hospital; and 3) the regional hospital boards were focused on functions, not

advocacy.

VII.3.3 Characteristics of New Brunswick’s Regionalization Model

VII.3.3.1 Population size

The seven health regions consisted of eight regional hospital corporations. One region in the

Moncton area (located in southeastern New Brunswick) had both Anglophone and Francophone

hospital corporation boards. The New Brunswick health regions varied in geographical size and

population ranging from 29,325 residents to 179,840 residents.

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VII.3.3.2 Design, governance, and accountability: a legislative framework

The governing boards of the health regions consisted of 12-16 members. Initially, the

Minister of Health appointed the board chairs, board members and the Chief Executive Officers.

As of June 1994, the boards were to consist of four appointments made by the Minister of

Health; the board itself made three appointments; and the remaining members were appointed by

municipalities located within the region (King, 1996).

The Hospital Act, Chapter H-6.1 provided the health regions with legislative rules and

regulations. The first section described the land and buildings transferred to each health region.

The second outlined the structure and operational characteristics. Key elements of the legislation

are illustrated in Appendix D-6. In the following sections, the roles of different actors including

the provincial government and the health regions are described.

No content was specified as to how the role and structure of the Ministry of Health and

Community Services would change following regionalization. There was no specific description

of the powers of the Minister. Various sections reinforced central control by program advisors

within the New Brunswick Health Ministry wherein health regions were had to seek out written

permission from the Minister with respect to specific types of decisions they made such as:

adding or altering a hospital facility; adding or altering a hospital service; or engaging in any

program to train persons in the medical and allied professions. It appears as if the New

Brunswick government gave very limited powers to the health regions and even so they would

be closely monitored by Health ministry program administrators to ensure that achieving the

critical health reform policy goals of cost containment and reducing acute care beds were

achieved.

An overall purpose was described for the health regions, but a list of functions was not

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included. The legislation was also silent about core health care services or how regions were to

deliver services. Nor were the geographic boundaries of the seven health regions described. No

content was included about cross sectoral resource re-allocation decisions.

VII.3.3.3 Regional functions and assignment of services

Health regions were initially assigned responsibility for the administration of acute care

and addiction services. Key regional functions included: service planning, managing, delivering

services, monitoring outcomes, and evaluating. As of 1996, delivery of publicly funded home

care (i.e. the EMP component) was assigned for regional administration however provision of

chronic home care was not decentralized.

From the outset, there was no attention paid to resource reallocation in the New

Brunswick policy and planning documents. The similar tension between the central role in

ensuring health reform policy goals are met and local autonomy to design services based on

needs is evident. Although moving resources between health sectors was not viewed as part of

the government’s health restructuring policy agenda, several regional key informants made the

following observations about the ability of health regions to make resource re-allocations:

“from what I’ve been able to see in the last three years, I don’t think resource allocations really have changed much.” “I don’t care much for protected funding in one program versus another program. The concept is ... is not particularly useful in my experience because ... it’s an artificial boundary around something that is important but can’t be preconceived to be more important than anything else.”

The health regions could, theoretically, make resource reallocations from hospitals to home care.

However, in practical terms, as observed during the interviews with regional key informants,

there was little interest given the ongoing demand the regions were facing to fund more acute

care services.

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VII.3.3.4 Implementation of regionalization

The government in New Brunswick moved swiftly to regionalize hospitals and addiction

services following a March 1992 announcement (Reamy, 1995). No public consultations

preceded the announcement and the speed with which the health regions were formed surprised

many key health actors (Reamy, 1995). However, the government rationalized its actions

because many health care actors had been previously engaged in discussions about the need to

restructure health care delivery and should had been prepared for the changes through pubic

consultations held at the time of the McKelvey/Levesque Commission. The government

defended its action because numerous provincial studies connected with the Commission in

which key health care actors had participated, set the stage for the government’s reform

directions (Reamy, 1995).

Health reform in New Brunswick was meant to reduce costs through hospital bed

closures and reduction of service duplication (King, 1996). The New Brunswick reforms were

responsive to the problems in both governance structures in the hospital sector and aimed at

specific changes to the delivery of hospital-based acute care services wherein collaboration and

cooperation (Hurley et al., 1994). During a speech to the legislature in March 1992, King

described the New Brunswick model of regionalization as:

the Ministry decided that within a provincially controlled planning framework, sound management principles called for a system of regional hospital boards to oversee implementation [of provincially determined plans] and the day-to-day management and provision of services (1996, p.114).

The three-term Liberal government which had largely been responsible for implementing

health reform in New Brunswick was defeated by the Progressive Conservatives during an

election held in 1999. The newly elected government had its own ideas about health reform. A

Premier’s Quality Council was immediately set up by the PC government which subsequently

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made recommendations about further health restructuring that should be implemented. The PC

government began to make adjustments in its approach to regionalization in 2002. The major

changes included transforming health regions through a mandate to deliver a broader range of

health care services. The consistency of the New Brunswick model of regionalization throughout

the study time frame is a strength of this policy analysis and enabled the baseline data about

home care expenditures to be analyzed.

VII.4 Regionalization Results: Analyzing the Impact

In 2000, the government of New Brunswick subdivided the large Health ministry and

created a Ministry of Health and Wellness and a Ministry of Family and Community Services.

VII.4.1 Hospital Funding Delivery and Allocation

There was a reduction of 51 hospital and health services centre boards to eight regional

boards which governed publicly funded and medically necessary acute care hospital-based

services. Table 7-1 illustrates historical data about hospital services in New Brunswick.

Hospitalizations fell by 13,899 (13%) and total hospital days by 50,298 (7%). The average length

of stay for New Brunswick of 7.2 days in 2001, was about the same as the Canadian average of

7.3 days.

Table 7-1: Selected hospital indicators, New Brunswick

Indicator 1995 2000 2001

Hospitalizations 114473 102400 100574

Age Standardized Hospitalization Rates per 100,000 (Canada in parenthesis)

14,970 (10,942)

12,892 (9,137)

12,573 (8,796)

Total Hospital Days 770,229 727625 719931

Average Length of Hospital Stay (in days) (Canada in parenthesis)

6.7 (7.2)

7.1 (7.2)

7.2 (7.3)

Source: www.cihi.ca/cihiweb/en/media_19nov2003_tab1_e.html; tab2_e.html;tab3_e.html;tab4_html;

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VII.4.2 Nursing Home Funding, Delivery, and Allocation

The government introduced a single entry process in 1993 (Hollander & Walker, 1998).

Assessments were completed by two professionals: a social worker from the FCSS division

within the Health ministry and a health care professional from the EMP or from mental health.

The FCSS social worker usually became the ongoing case manager, while the EMP case

managed its own clients. Clients who require care in a nursing home are reviewed by a regional

panel prior to being approved for admission (Hollander & Walker, 1998).

VII.4.3 Home Care Funding, Delivery, and Allocation

The administration of the EMP was not initially assigned to the health regions following

the implementation of health reform in 1992. The EMP was assigned for regional administration

in 1996, however the Hospital Services Branch in the Health Ministry continued to be

responsible for the provincial policy direction for home care and worked collaboratively with the

health regions to “assure the availability of consistent home health care services throughout the

province; establish provincial policy and standards; and fund and monitor the program” (New

Brunswick Health and Wellness, 2003b, p.1).

The EMP was funded through a protected budget within the global funding envelope for

each health region (New Brunswick Health and Wellness, 2003b). The health regions were

responsible for the planning and service delivery while ensuring that home health care is

available and delivered according to prescribed, centrally-determined policies and standards

(Health Infostructure Atlantic, 2002).

EMP services were provided by employees of the health regions (and prior to regional

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administration were provincial employees) i.e. nurses, occupational therapists, physiotherapists,

dieticians, respiratory therapists, social workers, and speech language pathologists. There are

over 640 funded full-time equivalent EMP positions throughout the health regions (New

Brunswick Health and Wellness, 2003b). There is a different delivery model however for the

home support component of the EMP (that is funded under the FCSS Division). Contracted

providers including not-for-profit home support agencies are used to deliver limited, short-term

home support services to EMP clients (as well as longer-term, ongoing services to chronic home

care clients funded through the FCSS division).

Utilization data is not available for most of the years included in this policy analysis.

Following the First Minister’s meeting in September 2000, home care was one of the areas for

which performance indicators were developed by the New Brunswick ministry. Table 7-2

provides utilization data for 2000/01 only.

Table 7-2: Extra-Mural Program utilization data, 2000/01

Extra-Mural Utilization Data, 2000/01

Admissions 17964

Discharges 18359

Admissions per 100,000 population 2800

Source: New Brunswick Department of Health and Wellness, 2003b

Approximately 62% of the EMP clients are over the age of 65 years. Children and

adolescents make up 11% of the client population, while adults (19-64 years) comprised 27%.

Nursing services were delivered to 70% of the clients admitted to the EMP with most of this

dedicated to nursing care for acute care conditions, while the remaining 30% require nursing

over a longer-time period. About 4-5% of the client caseload has received palliative care, while

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5% has received home oxygen therapy (New Brunswick Health and Wellness, 2003b).

VII.4.4 Provincial Government Health Care Expenditures

In 1990/91, the New Brunswick provincial government health expenditures (in current

dollars) were $1.075 billion, while in 2000/01 these increased by 39% to $1.487 billion (Figure

7-1). Annual percentage changes ranged from a decrease of 1.8% in 1997/98 to an increase of

8.7% in 1999/2000 (Figure 7-2). There appears to be a pattern of percentage increases which

precede provincial elections; e.g. in 1990/91 provincial government health spending increased by

7.1% prior to a September 1991 election, and again in 1995/96 when an increase of 3.8%

preceded a September 1995 election. Another increase of 8.7% preceded a June 1999 election,

where the Liberal government was defeated by the Progressive Conservatives.

Per capita provincial government health expenditures ranged from $1448.99 in 1990/91

to $1982.36 in 2000/01 (Figure 7-3). New Brunswick consistently spends approximately $115

less per capita than the Canadian average. A combination of a weak provincial economy and

mounting provincial debt may explain why the province of New Brunswick spends less.

Between 1990/91 and 2000/01, the provincial government health expenditures increased

from 25.7% to 27.9% of total government expenditures (Figure 7-4). Following implementation

of health regions in 1992, the proportion was 25.3% and was the same for the year preceding

regionalization. This proportion decreased slightly to 24.9% for the year following

regionalization and remained at this percentage through to 2000/01.

In 2000/01, provincial government health spending as a percentage of the provincial GDP

was 7.3%, compared with the Canadian average of 6% (Figure 7-5). For most years between

1990/91 and 2000/01, the New Brunswick provincial government health expenditures as a

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percentage of the provincial GDP were approximately 1.5% higher than the Canadian average at

6.3%.

VII.4.5 Provincial Government Home Care Expenditures

Publicly funded home care delivered through the EMP included payment for professional

home care services as well as administration costs (Ballinger, et al., 2001). Provincial

government home care expenditures (constant dollars) increased by 107% between 1990/91 and

2000/01 (Figure 7-6). This growth demonstrates the ongoing commitment of various New

Brunswick provincial governments and health regions to increasing the publicly funded home

care infrastructure. New Brunswick was one of the first Canadian provinces to implement home

care and the EMP is often referred to by other jurisdictions as the ‘gold standard’ for acute care

substitution home care that supports the efficient operation of hospitals and is an economical

alternative to in-patient acute care (CIHI, 2007). The annual percentage changes between

1990/91 and 1999/00 were all positive. The increases ranged from 27.7% in 1990/91 to 2.5% in

1996/97, which was when the EMP was assigned for regional administration (Figure 7-7).

The per capita provincial government home care expenditures (constant dollars) ranged

from $67.84 in 1990/91 to $122.99 in 1998/99, an 81% increase (Figure 7-8). This is less the

Canadian increase of 157%, although the New Brunswick per capita expenditures are

consistently higher than the Canadian average per capita. According to CIHI (2007), New

Brunswick has the highest per capita expenditure at $156.35 in 2003/04. Possible explanations as

to why the New Brunswick per capita is higher are that the EMP provides intense levels of home

care services given its primary focus on acute care substitution and there are higher costs

associated with delivering home care in rural areas.

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VII.4.6 Home Care and Hospital Resource Reallocation

The hospital share of provincial government health expenditures was 52.8% in 1990/91

and decreased slightly to 51.4% by 2000/01 (Appendix A-8). Despite a major policy goal of New

Brunswick health reform of “rationalizing” acute care services, the share of hospital spending

increased for the first three years following regionalization. The health reform direction did not

appear to cause drastic reductions to the hospital sectoral share of provincial government health

spending. These results differ somewhat from what might have been expected, given the strength

of the rhetoric used in the government planning documents where the New Brunswick health

reform policy goals were described.

The home care share of provincial government health expenditures was at 7.6% in

2000/01, up from 4.1% in 1990/91 (Figure 6-9). There was almost a 1% increase following

formation of health regions in 1992, although the EMP was not decentralized at this time. There

was a corresponding increase of approximately 1% in the home care share of provincial

government health spending between 1997/98 and 2000/01. This result suggests that health

regions could have made some re-allocations to home care from the hospital sector.

Alternatively, the incremental changes between years as illustrated in Figure 6-9 might be

accounted for by funding increases provided to the EMP budget by central program

administrators in the Health ministry.

Coyte (2000) reported that some Canadian provinces had allocated approximately 5% of

provincial government health spending to home care. CIHI (2007) described the Canadian

average of 4.2% as representing the home care share of provincial government health spending

for 2003/04, while this share was at 3.1% in 1994/95. The home care share of 4.1% in 1990/91

was already higher than at the Canadian average in 2003/02. And, at 7.6% for 2000/01, the home

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care share exceeded the Canadian average by more than 3%. New Brunswick and Manitoba,

have historically had higher shares of provincial government health spending because these

jurisdictions have developed more comprehensive home care programs (CIHI, 2007).

The length of stay for acute care in New Brunswick was 7.2 days in 2001 compared with

the Canadian rate of 7.2 days (Table 7-1). Accordingly home care has effectively substituted for

in-hospital care. New Brunswick, along with Quebec, has the highest home care utilization rate

of 33.1 users/1000 population of all Canadian jurisdictions. CIHI (2007) reported that the EMP

portion of home care in New Brunswick has since its inception, played an important role in

health care delivery and in particular, it has been a cost effective alternative to acute hospital

care.

VII.4.7 Regional Home Care Expenditures

The EMP spending varies across the health regions (Figure 7-10). The per capita

spending is highest for Region 4 followed by Region 5 both of which are rural areas (Figure 7-

11). These urban areas (i.e. Regions 2 and 3) have the lowest per capita spending. The

differences between rural and urban per capita home care expenditures are influenced by various

factors. First, there is a higher proportion of elderly residents living in Regions 4 and 5.

Residents of these regions are mainly referred to urban areas (i.e. Regions 2 and 3) for acute

treatment. Because of the EMP’s role in delivering early discharge home care following in-

hospital treatment, residents return to their homes with high levels of in-home services. Given

this geographical location, the cost of providing home care in rural areas is also higher.

VII.5 Views of Regional Key Informants: Observations about Resource Allocation

VII.5.1 Funding and Budget Methods

The funding formula used to transfer money from the New Brunswick government to the

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health regions was based on historical expenditures (Denis et al., 1999). A global budget was

implemented but in practice the flexibility usually associated with this type of budget was limited

because the New Brunswick government used protected budgets as an instrument to ensure that

resources for specified sectors were untouchable following assignment for regional

administration. As one regional key informant observed,

“But you see regionalization in New Brunswick is not – has not been – taken to the point where I have one big global budget and I can move money anywhere. We’re not there yet.”

Accordingly, as a protected budget, the EMP funding could not be reallocated to other health

care sectors such as hospitals or mental health but, resources could flow from other sectors to the

EMP. Despite being regionalized the EMP budget continued to be decided by Ministry program

administrators. Given the increasing demands on the regional budgets for acute care related as

exemplified by the regional key informants, the health regions did not have the available

resources (or the will) to make re-allocations to home care. A strong commitment from centrally

located EMP administrators, coupled with ongoing support from physicians, were key factors in

enabling the EMP to continue growing in an era of hospital downsizing and health care cost

containment. The following quotes illustrate the frustrations of the New Brunswick regional

administrators with respect to the limitations that protected budgets imposed:

“I don’t have any indication that with further regionalization, i.e. the devolvement of public health or mental health, that would change. I could see the budget for the community mental health centres coming and it being a non-transferable program budget. And, I could see the budget for public health coming and it being non-transferable. Which means if, from the hospital’s perspective, you thought you weren’t doing as many surgery cases and you wanted to take some of the surgery budget and give it to public health, you could do that. But it doesn’t work the other way.” “We can’t move money in and out, and in and around, which is conceptually what regionalization was supposed to allow you to do. You can’t because I have such protected budgets that I can’t touch.”

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“When you have protected or non-portable budgets you will never get to the point where you’ll be able to totally maximize your efficiencies.”

Regional key informants did agree that a protected budget does secure the funding base for

particular programs; i.e. in this case, the EMP. As this final quote has illustrated, the health

regions thought the imposition of a protected budget to some extent hampered their efforts in

achieving integration.

VII.5.2 Central Control versus Local Autonomy

Hurley et al. (1994) described the New Brunswick model of regionalization as a central

planning approach which strengthened the responsibilities of provincial government program

administrators. The role of the regions was largely focused on carrying out managerial functions.

According to one regional key informant, regionalizing health care delivery heightened central

control and local autonomy tensions:

“I think one of the really big challenges of regionalization, which every province is still trying to sort out, is new roles. So what is the role of the health authority, versus the role of the bureaucracy, versus the role of the government? Who has got responsibility for what? What are the areas of authority? Where are the joint responsibilities, where they overlap? And I think from my experience, there’s a struggle that’s ongoing. There isn’t a comfortable conclusion as yet. And, there’s a dynamic tension that has always existed, and it’s been heightened with regionalization as people try and adjust to ... to a new way of doing things.”

The New Brunswick model was narrow because initially, only hospitals and mental health were

under regional administration. Planning and decision-making was tightly controlled by Ministry

of Health program administrators. The focus of the New Brunswick health regions was on the

active management of hospital utilization and the reduction of duplication.

The New Brunswick approach to regionalization was characterized as predominantly an

administrative reform because the health regions were limited to service delivery and constrained

by the small range of services for which they were responsible (Hurley et al., 1994). A regional

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structure responsible for a narrow array of health care services coupled with a protected budget

for the EMP limits local decision making. Accordingly, changing a structure creates trade-offs

between central control and local autonomy. A regional key informant summarized this tension

by observing, “there is great central control in New Brunswick and with regionalization, came

enhanced control.”

The New Brunswick provincial health reform planning documents had paid no attention

to the issue of reallocating resources between hospitals and home care. Could this lack of

attention resulted from a desire by government to control the extent of change, knowing that the

EMP had a strong funding base and a high level of credibility with physicians in particular,

compared with other provincial home care programs?

VII.5.3 Discussion of Findings

At the time regionalization was introduced in New Brunswick (1992), the hospital share

of provincial government health expenditures was 52.6% (Appendix A-8) and the home care

share was at 4.7% (Figure 7-9). Following regionalization the shares were 51.4% and 7.3%

respectively.

Why then, did the EMP continue to gain resources throughout an era of hospital

downsizing? Scope of conflict predicts a low level of conflict at the regional level because of the

low number of health care services which were assigned coupled with the presence of a protected

budget for the EMP. The New Brunswick increases in provincial government home care

spending largely happened because of the pre-existing success and visibility of the EMP, which

had well established funding levels prior to the introduction of health reform. It is a highly

successful and well recognized home care program throughout Canada and internationally (CIHI,

2007). A large portion of the EMP funding success is attributed to the support it receives from

172

physicians. Since the regionalization model implemented in New Brunswick was predominantly

focused on administrative reform of hospitals, this choice of model appears to have had little

impact on home care funding since regions did not reallocated resources to the EMP.

Alternatively, the increases to the EMP have largely been the result of allocation decisions

determined by centrally located program administrators in the New Brunswick Health Ministry

who had a strong commitment to maintaining the integrity of the EMP. The rational prediction

by the Canadian health reform literature that regionalizing health care delivery would lead to a

reallocation did not happen in New Brunswick. Inertia was evident and, if anything, most local

residents involved with the health regions were mainly interested in preserving hospital services.

173

Figure 7-1 Government Health Expenditures, New Brun swick, 1990/91-2000/01 - Current Dollars; Data Source: CIHI (2004) Table A-1, p.31

0

200

400

600

800

1000

1200

1400

1600

Year

$'00

0,00

0

NB 1075.1 1111.1 1152.9 1154.4 1200.6 1246.7 1230.3 1208.4 1289.3 1402 1487.3

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

Sept/91electionLiberalmajority



June/99electionPCmajority

174

Figure 7-2 Annual Percentage Change in Government H ealth Expenditures, New Brunswick & Canada, 1990/91-2000/01 - Current D ollars


-4

-2

0

2

4

6

8

10

NB 7.1 3.3 3.8 0.2 3.9 3.8 -1.3 -1.8 6.7 8.7 6.1

Canada 7.4 9.1 3.3 -0.4 1 -0.2 0.5 4.7 7 7.9 8.6

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01




June/99 electionPCmajority

175

Figure 7-3 Per Capita Government Health Expenditure s, New Brunswick & Canada, 1990/91-2000/01 - Current Dollars; Data Source: CIH I (2004) Table A-2, p.32

0

500

1000

1500

2000

2500

Dol

lars

NB 1448.99 1489.69 1541.8 1541.62 1599.31 1659.62 1634.81 1606.35 1717.42 1867.75 1982.36

Canada 1553.62 1677.16 1711.58 1685.68 1684.38 1663.9 1694.61 1716.44 1822.33 1950.04 2097.01

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01





176

Figure 7-4 Health as Proportion of Total Government Expenditures (includes debt charges), New Brunswick, 1990/91-200 0/01 - Current Dollars


0

5

10

15

20

25

30

Per

cent

NB 25.7 25.3 25.3 24.9 25 25.7 25.6 24.9 25.1 25.1 27.9

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01





177

Figure 7-5 Government Health Expenditure as Percent age of Provincial GDP, New Brunswick & Canada, 1990/91- 2000/01 - Current Dollars


0

1

2

3

4

5

6

7

8

9

Per

cent

NB 8 8.1 8.1 7.8 7.7 7.6 7.4 7.1 7.2 7.3 7.3

Canada 6.3 6.8 6.9 6.6 6.3 6 5.8 5.8 5.9 5.9 6

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01




June/99electionPC majority

178

Figure 7-6 New Brunswick Government Home Care Expen ditures, 1990/91-2000/01 - Constant & Current Dollars

Data Sources: CIHI (2001) Table 3, p.C-4; CIHI (200 7) Table B.3, p.30

0

20000000

40000000

60000000

80000000

100000000

120000000

dolla

rs

current 44014100 51972100 54933700 64556500 68943400 73080300 74873800 82114000 94073800 106108700113940600

constant 50336931 56925800 58363146 67456984 70974931 74506835 75916354 80928273 92715357 102743919104244480

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01




Extramural Prograndecentralized to health regions

June/99 electionPC majority

179

Figure 7-7 Annual Percentage Change in Government H ome Care Expenditures, New Brunswick & Canada, 1990/91-2000/01 - Current D ollars


0

5

10

15

20

25

30

35

40

perc

ent

NB 27.7 18.1 5.7 17.5 6.8 6 2.5 6.6 17.9 12.8 7.4

CAN 16.8 18.4 10.5 36.5 10.1 3 5.7 12.6 16.1

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01



Extramural Prograndecentralized to health regions



180

Figure 7-8 Government Home Care Expenditures, Per C apita, New Brunswick & Canada, 1990/91-1998/99 - Constant Dollars; Data Source: CI HI (2001) Table 4, p.C-5

0

20

40

60

80

100

120

140

160

dolla

rs

NB 67.84 76.31 78 89.93 94.45 99.09 100.75 105.8 122.99 135.94

CAN 40.1 44.98 47.62 63.25 67.84 68.49 71.26 78.32 88.92

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

Extramural Prograndecentralized to health regionsSept/91

electionLiberal majority




181

Figure 7-9 Home Care Share of Government Health Exp enditures, New Brunwick, 1990/91-2000/01 - Current Dollars


0

1

2

3

4

5

6

7

8

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

perc

ent

Sept/91 electionLiberal majorit




Extra-mural Program (acute home care) decentralized to health regions

182

Figure 7-10 New Brunswick Regional Home Care Expend itures 1998/99-2000/01 - Current Dollars; Data Source: Extramural Home Car e Program (Note: Figure does not include Chronic home care ex penditures)

0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

9,000,000

10,000,000

dolla

rs

Region 1 8080440 8568884 9493198

Region 2 7795858 8412258 9034766

Region 3 7081326 7776392 8101094

Region 4 3948034 3991584 4190184

Region 5 1737968 1805333 1929343

Region 6 4084743 4258724 4652572

Region 7 2238155 2424012 2268098

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

183

Figure 7-11 Per Capita EMP Expenditures, New Brunsw ick Health Regions & Province 1990/91-2000/01 - Current Dollars; Data Source: Ext ramural Program

(Note: Figure does not include Chronic home care ex penditures)

0.00

10.00

20.00

30.00

40.00

50.00

60.00

70.00

80.00

90.00

dolla

rs

Region 1 44.56 47.06 51.93

Region 2 45.19 48.97 52.80

Region 3 43.51 47.72 49.65

Region 4 74.92 76.25 80.57

Region 5 56.22 59.32 64.42

Region 6 48.17 50.78 56.10

Region 7 46.65 50.77 47.73

Prov per cap 24.95 28.16 32.47 39.54 39.35 40.38 38.72 43.14 47.71 50.92 54.38

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

184

CHAPTER VIII: DISCUSSION AND CONCLUSIONS In the previous chapters, results of a natural policy experiment have been reviewed where

three similar Canadian provinces (Prince Edward Island, Nova Scotia, and New Brunswick)

implemented three different models of regionalization. This research has concentrated on the

extent to which resources were allocated to hospitals and to home care, and the extent of

reallocation.

VIII.1 Comparison of Cases in a Natural Policy Experiment

As described in Chapter 3, case studies require that the cases be both similar and

different. Resource allocation is related to a number of factors other than organizational

structures. Appropriate case selection can, in effect, control for some of these key variables. As

noted in Chapters V-VII, Prince Edward Island, Nova Scotia and New Brunswick share similar

demographic, economic, government spending, and political characteristics ( Appendices E-1

through E-7). Provincial similarities include: all are located within the same country and

geographic region, all are bound by the same federal legislation (the Canada Health Act), and

have similar (and high, in international terms) incomes. Within Canada, these three provinces are

all characterized by declining resource-based economic conditions; lower annual income than the

Canadian average; a declining provincial population; an increasing proportion of elderly

residents over the age of 65 (above the Canadian average); a shrinking rural population (as

workers move to urban areas inside and outside these provinces) which must continue to receive

health care services despite the lack of a sufficient population base; and an overall health status

lower than the rest of Canada. Figures at the end of this chapter provide comparisons for key

financial indicators including government health expenditures (Figure 8-1); provincial

government health expenditures (Figure 8-2); per capita provincial government health

185

expenditures (Figure 8-3); health spending as a proportion of provincial government

expenditures (Figure 8-4); and health as proportion of GDP (Figure 8-5). To the extent that these

factors would influence resource allocation, they were in effect controlled for in as much as is

possible in a natural policy experiment.

VIII.2 Results of Cross Case Policy Analysis

As noted in previous chapters, the Prince Edward Island, Nova Scotia, and New

Brunswick governments all implemented distinct models of regionalization. Each province

included among the policy goals for health restructuring, the improvement of health care delivery

through increased provision of home care and community-based services. The Canadian health

reform literature suggested that health regions would break funding gridlocks created by pre-

reform structural arrangements, and that breaking down these funding silos would make it easier

to achieve these results. In contrast, the political science scope of conflict theory would predict

that, the greater the array of health sectors included in the basket of services administered by the

health regions, the greater the conflict among these sectors for funding resources.

New Brunswick regionalized health care delivery in 1992. Initially, regional authority

included only hospitals, but expanded in 1996 to the Extra-Mural Program (EMP) while chronic

home care remained under the administration of the Health and Social Services Ministry. Prince

Edward Island regionalized the administration of a comprehensive array of health and social

services in 1994, including home care. Nova Scotia was the last province of the three to

implement regionalization in 1997, and did not incorporate home care into regional structures.

This section answers the following research questions: What are the provincial

expenditure trends for home care? What are the per capita expenditure trends at the provincial

level? Did placing home care under regional administration result in higher per capita spending

186

at the provincial level compared with keeping the administration of home care centralized? What

are the regional expenditure trends for home care? What are the regional per capita expenditures?

Table 8-1 compares some financial outcomes prior to and following the introduction of

regionalization.

Table 8-1: Comparison of per capita provincial government home care expenditures

Indicator Prince Edward Island

Nova Scotia

New Brunswick

Canada

PROVINCIAL GOVERNMENT HOME CARE EXPENDITURES,

1990/91-2000/01 (CONSTANT DOLLARS)

Percent change in aggregate spending between 1990/91 & 2000/01

113% 323% 107% 157%

PER CAPITA PROVINCIAL GOVERNMENT HOME CARE EXPENDIT URES, 1990/91 – 1998/99 (CONSTANT DOLLARS)

1990/91 per capita 24.11 22.84 67.84 40.1

Provincial difference from 1990/91 average Canadian per capita

$15.99 lower $17.24 lower $27.74 higher n/a

1998/99 per capita* 35.43 82.32 122.99 88.92

Provincial difference from 1998/99 average Canadian per capita

$53.49 lower $6.60 lower $34.07 higher n/a

Percent change in per capita spending between 1990/91 & 1998/99

47% 260% 81% 121%

*Latest year for which per capita provincial government home care expenditure data is available in CIHI (2001).

VIII.2.1 Provincial Government Health Care Spending - History Matters!

The percent change in provincial government funded home care expenditures for Canada

between 1990/91 and 2000/01 increased by 157% (CIHI, 2007). Since the starting point was

187

small, this moved the average Canadian share of provincial health expenditures for home care in

2002/03 to 4.2% from 3.1% in 1994/95 (CIHI, 2007). Recognizing data limitations, one can

conclude that home care programs across Canada have enjoyed rapid growth, and that although

they are becoming increasingly more important in providing cost effective alternatives to

institutional care, they still account for a small proportion of total government health

expenditures (CIHI, 2007). At the same time, between 1990/91 and 2000/01 hospitals were

shrinking as both the number of beds and their share of government health expenditures (from

49.2% in 1991/92 to 43.4% in 2000/01) decreased (CIHI, 2004).

When comparing the percentage change in aggregate home care spending across the three

provinces, the first conclusion is that history matters. At the outset, Prince Edward Island and

Nova Scotia spent less than the Canadian average per capita for home care, whereas New

Brunswick spent considerably more. Prince Edward Island’s overall gain at 113% was the lowest

of the three provinces, and much lower than the Canadian growth of 157%, putting Prince

Edward Island even farther behind the rest of the country in home care spending per capita. Nova

Scotia’s spending increase at 428% was much larger than the Canadian average but home care

started from a different place. Nova Scotia was the last Canadian province to implement a

comprehensive home care program in 1995. Prior to restructuring health care delivery, oversight

of home care was located within the Ministry of Community Services. As such, home care had

not developed as a substitute for acute care in-patient hospital services, a common occurrence in

other provinces. Accordingly, prior to its transfer to the Health Ministry, government funding

allocated to home care was limited. The movement of home care to the Nova Scotia Health

Ministry was a deliberate move, in order to expand the home care mandate of providing acute

care substitution services which were deemed an essential building block to support the efficient

188

delivery of health care. The New Brunswick increase in aggregate home care spending of 141%

was just under the Canadian rate of change.

VIII.2.2 Per capita Home Care Expenditures - History Matters Again

Even with a sizeable growth of aggregate expenditures, per capita spending in Nova

Scotia, the totals were still less than the Canadian average of $88.92. The Nova Scotia per capita

home care expenditure of $22.84 in 1990/91 was the lowest of the three provinces and was

$17.24 less than the Canadian average per capita of $40.10. The transfer of significant funding

was required to advance home care as a viable sector in the delivery of health care in Nova

Scotia. Maintaining central control of the provincial home care budget at the time other services

were being assigned to health regions, allowed the Nova Scotia government assurance that the

funding allocated would indeed be spent on home care. Central program administrators within

Home Care Nova Scotia (HCNS) were aware of its marginalized status and knew that home care

could be vulnerable in a regionalized model of health care delivery where acute care remained

dominant. Although there was a substantial increase in government spending on home care,

following its transfer to the Health Ministry, as of 1998/99 the Nova Scotia per capita at $82.32

had not as yet caught up to Canadian per capita of $88.92.

The Prince Edward Island home care per capita of $35.42 in 1998/99 was the lowest of

the three provinces. Because of the substantial difference of $53.59 between Prince Edward

Island’s per capita and the Canadian average, it is concluded that home care had fallen much

farther behind following its inclusion in the basket of services administered by the health

regions. New Brunswick’s per capita of $122.99 in 1998/99 was still ahead of the Canadian

average. It continues to be the highest of the three provinces, and one of the highest in Canada

(CIHI, 2007) because the EMP, from the time of its inception, was designed to substitute for in-

189

patient acute care through to early hospital discharge or delay admissions. The EMP has been

and continued to be the beneficiary of substantial funding by the New Brunswick government. A

major distinction between the three provinces, is that the EMP program had a well-established

funding base prior to the onset of health restructuring. Per capita home care growth in Prince

Edward Island increased by 47%, which is the smallest percentage gain of the three provinces. It

is suggested the Prince Edward Island growth in home care was slower given its inclusion in a

broad-based basket of health care services assigned to the health regions. Consequently, and in

accordance with scope of conflict theory, home care in Prince Edward Island competed for its

share of health funding, resulting in marginal gains in resources.

There was a similar trend, in all three provinces, of lower per capita home care

expenditures in the urban health regions and higher per capita expenditures in the rural areas.

This similar pattern of inter-regional variation within all three provinces can, in part, be

attributed to the high proportion of seniors living in rural areas as well as the implications of a

dispersed rural population involving extensive geographical distances between clients and the

associated travel costs of providing home care services in these areas.

VIII.2.3 Resource Allocation to Home Care Compared with Hospitals

This section answers the following research questions: What is the home care share of

provincial health expenditures? How does the resource allocation trend for home care compare

with the trend for the hospitals? Did putting home care under regional administration result in a

different resource allocation outcome at the provincial level compared with keeping the

administration of home care centralized? Table 8-2 compares the share of provincial government

health spending for home care and hospitals in current dollars.

190

Table 8-2: Comparison of home care share of provincial government health expenditures

Year Prince Edward Island

Nova Scotia

New Brunswick Canada

HOME CARE SHARE OF PROVINCIAL GOVERNMENT HEALTH EXPENDITURES (CURRENT DOLLARS)

1990/91 1.6% 1.4% 4.1% n/a

2000/01 2.2% 5.4% 7.6% n/a

Percent change in home care share of government health expenditures

Increase of 0.6%

Increase of 4%

Increase of 3.5%

n/a

HOSPITAL SHARE OF PROVINCIAL GOVERNMENT HEALTH EXPE NDITURES

(CURRENT DOLLARS)

1990/91 54.3% 58.8% 52.6% 49.2%

2000/01 48.4% 50.0% 51.4% 43.4%

Percent change in hospital share of government health expenditures

Decrease of 5.9%

Decrease of 8.8%

Decrease of 1.2%

Decrease of 5.8%

In Prince Edward Island, there is stability resulting in the preservation of the status quo.

The home care share of provincial government health spending marginally increased by 0.6%

between 1994 when health reform was introduced and 2000/01. The hospital share of provincial

government health spending in Prince Edward Island dropped 5.9% within this same time frame.

Most of the corresponding funding increases went to drugs and capital expenditures (Appendix

A-8). Nova Scotia saw a substantial drop in the share of provincial government health spending

devoted to hospitals, resulting in an overall decrease of 8.8% between 1990/91 and 2000/01. This

resulted in an increase of the share of funding allocated to home care and other institutions as

191

well as physicians (Appendix A-8). The share of hospital spending for New Brunswick can be

described as inert and static. There was a very small decrease in the hospital share of provincial

government health spending while the home care share increased by 3.8%.

VIII.2.4 Data Limitations

Interpreting these changes in percentage share of provincial government health spending

is problematic because of way in which home care expenditure data is reported to and by the

Canadian Institute for Health Information (CIHI). The data gathered nationally is guided by the

Organization for Economic Co-operation and Development (OECD) definition of home care

which only includes expenditure for the home health component or that part of home care which

mainly substitutes for in-patient acute care. These services include nursing and others provided

by professional providers such as dietician, rehabilitation, and so on (Ballinger et al.2001). The

feasibility study by Ballinger et al. (2001) argued that the CIHI definition of home care should be

expanded to include spending on home support / personal care since these services are viewed as

an integral component of comprehensive home care programs and provincial governments spend

a significant amount of resources on home support. Ballinger et al. (2001) recommended that

CIHI incorporate home support services in an expanded definition of home care. Without the

inclusion of the home support as part of the regularly collected home care expenditure data,

Ballinger et al. (2001) concluded that Canadian home care expenditure data would not reflect the

comprehensiveness of the services provided through government funded home care programs,

especially since home support services are necessary services when home care substitutes for

care provided in nursing homes or long term care institutions. The Ballinger et al. (2001) data

was used for this policy analysis and was augmented with more recent data from a recent CIHI

(2007) study on home care.

192

Another critical issue of conducting policy research that relies on using Canadian and

provincial government home care expenditures, is that these data are routinely included in the

“other health spending” category used by CIHI. In addition to home care, this category includes

health research funding and ‘other’ which in subdivided into expenditures for medical

transportation/ambulances, hearing aids, training of health workers, voluntary health associations

(CIHI, 2007). With the exception of the 2001 and 2007 CIHI reports specifically aimed at

reporting national and provincial home care expenditures, it is not possible to routinely collect or

update on government spending for provincial home care programs because it is reported

through this consolidated category. In this particular policy research study we were able to do

this because of the work completed by Ballinger et al. (2001) and the 2007 CIHI study.

VIII.3 Discussion and Conclusion

What can be concluded in this policy analysis? Inertia and entrenchment of spending

patterns was strong. Health regions did not appear to undertake resource reallocation to any great

extent in either Prince Edward Island or New Brunswick. In these two provinces, the best way to

predict spending in one year was to look at previous years. The conclusion about whether a

finding of a 1% change in home care share of funding for Prince Edward Island is large or small

is clearly dependent on interpretation. Given that the home care share of provincial government

health spending did almost double, does that mean the change is substantial?

The Canadian health reform as described in Chapter II predicted that a regionalized

system of health care service delivery would lead to reallocation, which did not happen in New

Brunswick and Prince Edward Island. Resource reallocation did occur in Nova Scotia where the

hospital share of government spending went down and was reallocated to home care and nursing

homes. But, Nova Scotia is the only province of the three in which home care and nursing homes

193

were not regionalized.

Regional key informants from all three provinces confirmed that local residents of health

regions wanted to preserve the status quo. In other words, they continued to emphasize hospital

based care and in particular they were not pleased with health reform efforts aimed at

downsizing hospital services with a corresponding reduction in number of beds. To counteract

these local views, which reinforced the position of hospitals as powerful actors, New Brunswick

provincial administrators working with the EMP ensured that its budget, upon being transferred

to the health regions in 1996, was protected. In comparison, there was no protective mechanism

put in place for the home care budget in Prince Edward Island upon its assignment for regional

administration in 1994. Therefore home care, as an underdeveloped and less powerful sector was

placed in a vulnerable position where local interests were focused on acute care, with a well

established funding base, which had been entrenched through Ministry program silos prior to

health restructuring. The regional interest of maintaining existing levels of in-patient hospital

beds was clearly a source of tension between the overarching policy goals formulated for health

reform by the provincial governments and the local health regions formed to implement the

structures to support goal attainment. Nevertheless, despite a deliberate emphasis by the

provincial governments on improving cost effectiveness of health care delivery through shifting

more care to community-based delivery models, health regions, once up and running, continued

to emphasize hospitals and acute care services. Provincial governments constrained local

autonomy in order to protect home care. For example, New Brunswick protected the EMP

budget, while Nova Scotia maintained central control of home care funding. It is striking this

tension between local autonomy and protecting home care services existed.

The home care sector in Prince Edward Island was most vulnerable within the three

194

regional models considered in this policy analysis because it was assigned for regional

administration along with a broad array of health sectors and, its budget was not protected. Scope

of conflict theory suggests that structures influence outcomes and that more powerful actors will

act in their self- interest to gain or protect existing resources. Since the Prince Edward Island

budget for home care was a small share of government health expenditures, it was not nearly as

powerful as hospitals, and since the public was uncertain about what home care involved, it was

marginalized. Although the Prince Edward Island per capita spending on home care did increase,

the home care share of provincial government health spending did not gain as much as in New

Brunswick and Nova Scotia. These findings align with the theoretical framework described in

Chapter II. As predicted by the scope of conflict theory, the Prince Edward Island model of

regionalization forced home care to compete with hospitals and health regions. This policy

analysis concludes that by restructuring the delivery of health care to health regions, they did not

reallocate sufficient level of resources to support home care to the extent that was envisioned by

the opposing health reform argument whereby if the structure was changed, so too would the

resource allocation results.

Whether home care was assigned for regional administration (as in Prince Edward Island

and New Brunswick, but not in Nova Scotia) is what connects the theoretical and analytical

frameworks used in this policy research. Understanding the implications of regionalization as a

policy instrument to redistribute health care resources from acute care to home care was the

focus. The provinces of Prince Edward Island, Nova Scotia, and New Brunswick share many

contextual similarities, with variation among the regional models as to whether home care was

present or absent. The scope of conflict theory hypothesized that changing structure (and the

inclusion of home care in the regional model) coupled with particular institutional arrangements

195

unique to each province, would be influential in measuring the extent to which the home care

sector increased its share provincial government health expenditures.

196

Figure 8-1 Government Health Expenditures for Princ e Edward Island, Nova Scotia, New Brunswick, 1990/91-2000/01 - Current Dollars; D ata Source: CIHI (2004) Table A-1, p.31

0

200

400

600

800

1000

1200

1400

1600

1800

2000

$'00

0,00

0

PEI 176.5 194 197 208 197.9 204.9 218 213.2 234.4 244.9 263.1

NS 1282.2 1351 1358.7 1311 1269.9 1313.5 1319.1 1629.6 1665.1 1785.4 1788.4

NB 1075.1 1111.1 1152.9 1154.4 1200.6 1246.7 1230.3 1208.4 1289.3 1402 1487.3

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

PEI regionalization begins

NS regionalizationbegins

NB regionalizationbegins

197

Figure 8-2 Annual Percentage Change in Health Expen ditures for Prince Edward Island, Nova Scotia, New Brunswick, Canada, 1990/91-2000/01 - Cu rrent Dollars


-10

-5

0

5

10

15

20

25

Per

cent

PEI 6.7 9.9 1.5 5.6 -4.8 3.5 5.4 -1.3 9.9 4.5 7.4

NS 6.2 5.4 0.6 -3.5 -3.1 3.4 0.4 23.5 2.2 7.2 0.2

NB 7.1 3.3 3.8 0.2 3.9 3.8 -1.3 -1.8 6.7 8.7 6.1

Canada 7.4 9.1 3.3 -0.4 1 -0.2 0.5 4.7 7 7.9 8.6

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01


NS regionalization begins

NB regionalization begins

198

Figure 8-3 Per Capita Government Health Expenditure s for Prince Edward Island, Nova Scotia, New Brunswick, Canada, 1990/91-2000/01 - Cu rrent Dollars


0

500

1000

1500

2000

2500

Dol

lars

PEI 1352.87 1488.8 1501.81 1570.64 1479.45 1518.14 1587.66 1565.73 1724.5 1795.02 1928.82

NS 1407.23 1473.24 1474.06 1415.85 1368.57 1412.21 1414.81 1745.97 1785.01 1907.46 1913.7

NB 1448.99 1489.69 1541.8 1541.62 1599.31 1659.62 1634.81 1606.35 1717.42 1867.75 1982.36

Canada 1553.62 1677.16 1711.58 1685.68 1684.38 1663.9 1694.61 1716.44 1822.33 1950.04 2097.01

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01



PEI regionalizationbegins

199

Figure 8-4 Health as Proportion of Total Government Expenditures (includes debt charges), Prince Edward Island, Nova Scotia, New Brunswick, Canada,

1990/91-2000/01 - Current Dollars; Data Source: CIH I (2004) Table A-5, p.35

0

5

10

15

20

25

30

35

perc

ent

PEI 23.2 24 23.7 20.4 23.8 24.6 25.3 25.2 26.5 26.1 25.4

NS 27.8 28.4 25.7 26.6 25.3 25.3 26.7 32 30.4 30.8 30.9

NB 25.7 25.3 25.3 24.9 25 25.7 25.6 24.9 25.1 25.1 27.9

Canada 28.7 28.5 28.5 28.1 27.8 27.3 28 29 29 30 31

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01


PEI regionalizaionbegins

NB regionalizaion begins

200

Figure 8-5 Government Health Expenditure as Percent of GDP for Prince Edward Island, Nova Scotia, New Brunswick, Canada, 1990/91-2000/01 - Current Dollars


0

1

2

3

4

5

6

7

8

9

Per

cent

PEI 8.1 8.5 8.3 8.4 7.7 7.6 7.7 7.5 7.7 7.6 7.8

NS 7.5 7.6 7.5 7.1 6.7 6.8 6.7 7.9 7.6 7.6 7.1

NB 8 8.1 8.1 7.8 7.7 7.6 7.4 7.1 7.2 7.3 7.3

Canada 6.3 6.8 6.9 6.6 6.3 6 5.8 5.8 5.9 5.9 6

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

PEI regionalizaion begins



201

Figure 8-6 Government Home Care Expenditures, Princ e Edward Island, Nova Scotia, New Brunswick, 1990/91-2000/01 - Constant Dollars

Data Source: CIHI (2001) Table 3, p.C-4; CIHI (200 7) Table B-3, p.30

0

20000000

40000000

60000000

80000000

100000000

120000000

dolla

rs

PEI 3141619 3221320 3532150 3810962 3498642 4152505 4786330 4640500 4858120 5090528 5363978

NS 20808110 20255762 19092058 20976330 23165227 50998333 57065600 59866758 72223224 84848626 87954012

NB 50336931 56925800 58363146 67456984 70974931 74506835 75916354 80928273 92715357 102743919 104244480

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01




202

Figure 8-7 Annual Percentage Change in Government H ome Care Expenditures, Prince Edward Island, Nova Scotia, New Brunswick, C anada, 1990/91-2000/01

- Current Dollars; Data Source: CIHI (2001) Table 3 , p.C-4

-20

0

20

40

60

80

100

120

140

Per

cent

PEI 18.8 7.1 13 9.7 -6.8 19.8 15.9 -1.7 6.2 10.5 7.8

NS 45.6 1.6 -2.8 11.7 11.4 120.2 14.1 6.4 22.8 21.8 5.8

NB 27.7 18.1 5.7 17.5 6.8 6 2.5 6.6 17.9 12.8 7.4

Canada 16.8 18.4 10.5 36.5 10.1 3 5.7 12.6 16.1

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

NB regionalizationbegins NS regionalization begins


203

Figure 8-8 Per Capita Government Home Care Expendit ures, Prince Edward Island, Nova Scotia, New Brunswick, Canada, 1990/91-1998/99 - Constant Dollars


0

20

40

60

80

100

120

140

160

Dol

lars

PEI 24.11 24.72 26.9 28.73 26.09 30.68 35.06 33.87 35.43

NS 22.84 22.09 20.72 22.66 24.82 54.85 64.35 67.97 82.32

NB 67.84 76.31 78 89.93 94.45 99.09 100.75 105.8 122.99 135.94

Canada 35.06 41.07 44.82 60.53 65.9 67.18 70.28 78.32 90.22

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01



PEI regionalizationbegins

204

Figure 8-9 Home Care Share of Government Health Exp enditures for Prince Edward Island, Nova Scotia, New Brunswick 1990/91-2000/01 - Curren t Dollars


0

1

2

3

4

5

6

7

8

perc

ent

PEI 1.6 1.5 1.7 1.8 1.7 2 2.1 2.2 2.1 2.2 2.2

NS 1.4 1.4 1.3 1.5 1.8 3.8 4.3 3.7 4.4 5.1 5.4

NB 4.1 4.7 4.8 5.6 5.7 5.9 6.1 6.8 7.3 7.6 7.6

90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01

PEI Regionalization begins

NB Regionalizationbegins

NS Regionalizationbegins

Extramural Programto regions

205

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Charlottetown: Prince Edward Island Government. VanTil, L. (1999). Prince Edward Island highlights: Second report on health of Canadians.

Charlottetown: Prince Edward Island Government. Walt, G. (1996). Policy analysis: an approach. In Janovsky (Ed.), Health policy and systems

development . Geneva: World Health Organization. Williams, A. P., Barnsley, J., Leggat, S., Deber, R. B., & Baranek, P. (1999). Long term care

goes to market: Managed competition and Ontario’s reform of community-based services. Canadian Journal of Aging, 18(2), 125-151.

Williams, A. P., Deber, R. B., Gildner, A., & Baranek, P. (1999). From medicare to home care:

state retrenchment and the profitization of Canada’s health care system. In Armstrong, H., P. Armstrong, & D. Coburn, D. (Eds.), Unhealthy times, Political economy perspectives on health and health care in Canada. Toronto: Oxford University Press.

World Health Organization Observatory. Glossary entry for Decentralization. ww.euro.who.int

accessed July, 2004. Yin, R.K. (1999). Enhancing the quality of case studies in health services research. Health

Services Research, 34(5), 1209-1225. Yin, R.K. (2003). Case study research: Design and methods, 3rd edition. London: Sage

Publications.

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Appendix A-1: Template for Case Study Context

TEMPLATE FOR COMPARISON OF CASES

Demographics: - % urban population, - % rural population - elderly proportion of provincial population (65+) - % of Canadian population

Geographic characteristics - size - physical description - urban/rural characteristics

Geographic characteristics - size - physical description - urban/rural characteristics

Economic characteristics - type of economy - government spending - per capita government spending - gross domestic product

Economic characteristics - type of economy - government spending - per capita government spending - gross domestic product

Socio-economic characteristics - income level - unemployment rate

Demographics: - % urban population, - % rural population - elderly proportion of provincial population (65+)

- % of Canadian population

Political characteristics - legislative seats - number of elections, shift in government

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Appendix A-2: Semi-Structured Interview Guide

REGIONALIZATION IN THE MARITIMES

REGIONAL HEALTH ORGANIZATIONS QUESTIONNAIRE INTRODUCTION Our research goal is to understand how the implementation of regionalization has affected the allocation of resources across health sectors and programs with a particular emphasis on home care. Health sectors compete for scarce resources under these reformed organizational structures and we are interested in learning about power relationships and the extent to which these have changed under regionalization. Prior to regionalization the acute care sector was a dominant actor in the health policy arena. Has this dominance continued under regionalization? How has regionalization changed the ‘rules of the game’ in terms of access to the provincial Ministries of Health? We are interested in learning about what’s changed “on the ground” given the differences in regionalization models implemented in the Maritime provinces following health reform in the 1990s. For example, how much autonomy do regions have in making resource allocation decisions? What institutional / governmental structures and processes either enable or inhibit this financial decision-making? How has sectoral lobbying for resources been affected? In this study resource allocation is defined as a financial decision made by a regional organization which assigns a particular budget amount or expenditure plan for a particular health sector/service/program such as hospitals, public health, mental health, home care, long term care, and addictions. Regionalization in this study is operationalized as the particular configuration of health sectors/services/programs chosen for regional administration. SECTION 1 We’ll begin with some high level questions about the impact of regionalization in your province... 1. Has the implementation of regionalization changed the way resource allocation decisions are made for various health sectors, services, or programs i.e., hospitals, home care, public health, mental health, long term care, addictions? 2. What difference has regionalization made to where financial resources go? For example, do you think regionalization has in fact broken down the program-based silos so as to facilitate the transfer of resources among sectors/programs/services? 3. What difference has regionalization made in terms of the informal power structures that affect resource allocation decision-making? Is the acute care sector more or less powerful as a result of

220

regionalization? What about home care? Public health? Mental Health? Addictions? Long term care? 4. How has the access to provincial policy makers changed under regionalization? For example, prior to health reform, there lobbying efforts by hospitals with Ministries of Health. Where are these now being directed? 5. How much autonomy do regions in your province have to make their own resource allocation decisions? SECTION 2 Now let’s talk about provincial funding that is transferred from the Ministry to regions... 6. How is the provincial funding transferred to your region determined? (For example, historical spending patterns, population based amount, others?) 7. To what extent are regions bound by provincial guidelines in making resource allocation decisions? For example, do certain sectors, programs, or services have budgets that are protected or non-portable / non-transferable (i.e. these funds cannot be transferred to another sector)? What sectors are protected by these rules - hospitals, home care, public health, mental health, long term care, addictions? SECTION 3 Next I’d like to delve into the specifics of regional decision-making and how your region decides which resources are allocated to the programs and services you administer... 8. How does the region receive funding from the provincial Ministry? (As a block/global amount? or “Pre-set” by sector/service/program?) 9. What process your region uses to decide how to allocate resources across sectors? What is the sequence of events from initiation through to decision-making? What mechanisms are used to support this approach? (Public consultation? Management and staff consultation? Stakeholder consultation? Others?) 10. How does your region identify the needs of the population you serve? Who participates in this? 11. How does the region determine priorities that drive resource allocation / budget decision-making? How are competing needs among various health sectors/programs/services priorized? 12. What difference has regionalization made in terms of the development of formal structures and processes connected with resource allocation decision-making? Do provinces have certain legislative requirements that must be adhered to? Or are there unwritten or informal

221

arrangements in relation to how sectors/programs/services get their share of the resources? SECTION 4 For this sector I’m interested in having you review some of our findings. I am going to show you some trend analysis charts which compare expenditures by province and by region for various sector/service/programs... 13. First, can you comment about the accuracy of our expenditure data? The data was compiled using various sources of expenditures including Provincial Public Accounts, Audited Financial Statements for Regional Health organizations, and in some cases Ministry of Health Annual Reports. Could we have the financial officers review the data for your region since the basis of presentation and how we’ve assigned expenditures is critical to the accuracy of our data, i.e., making sure that we are comparing apples with apples? 14. One of our key findings is that we are seeing no change in how resources are being allocated since regionalization was implemented. For example, the acute care sector continues to dominate regional and provincial expenditures in spite of the “rhetoric” about needing to reallocate resources to home care. Is this what you would expected? Why? Why not? 15. In terms of the trends analysis of our financial data, can you think of any particular nuances or subtleties that our data is not picking up? What factors come into play in your region that our data are not sensitive to? For example, could our results be affected by the fact that hospitals or long term care facilities are delivering home care; however, these expenditures are not captured in the regional home care expenditures? 16. There were predictions by some health reformers that regionalization would result in resources being “reallocated” to home care. Can you comment on why we are not seeing more regional resources being allocated to home care? 17. What do you think regionalization has meant in practice for home care when in fact it has had to compete for its share of regional resources with other more powerful and institutionalized actors such as acute care and long term care? 18. In closing, are there any other points you’d like to make?

THANK YOU FOR YOUR PARTICIPATION

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Appendix A-3: Study Fact Sheet

DO REGIONAL MODELS MATTER?: HOME CARE RESOURCE ALLOCATION IN THE MARITIMES

Pat Conrad, PhD Cand, Dept. of Health Policy Management and Evaluation, University of Toronto

RESEARCH QUESTION What are the implications of the regional models implemented by the provinces of PEI, NS, and NB for the allocation of resources to home care? RESEARCH OBJECTIVE To examine the impact of various regionalization models upon resource allocation with a particular emphasis on per capita and proportional expenditures devoted to home care at the provincial and regional levels compared with expenditures for hospitals and nursing homes/long term care over a ten year time period from 1990/1991-2000/2001. STUDY DESIGN AND RESEARCH METHODOLOGIES A cross case comparison research design is being used. Health expenditures will be examined for the years 1990/91 through 2001/2002 and used to construct trend lines over time of allocations (absolute values and rates of change for total $, per capita $, as % of provincial and regional budgets) by health sector (e.g., home care, hospitals, and long term care) Semi-structured interviews will verify budget data and will describe regional decision-making processes as well the constraints and enabling conditions underlying resource allocation. Public policy documents and regional reports will be used to create a chronology of reform and examine the political, social, and economic context underlying the reforms chosen and how they were operationalized and implemented. SIGNIFICANCE OF KNOWLEDGE GENERATED Health reformers have long argued for the desirability of “breaking down the silos” and by creating an integrated funding model resources would be reallocated to less costly care options so as to reduce expenditures and improve efficiency particularly by moving care from hospitals to citizens’ homes. Although integrated budgets are often justified on the basis of their potential to enable a rebalancing and strengthening of formerly marginalized services such as home care, public health, or health promotion, scope of conflict theory would instead suggest they may be at risk of being cannibalized in order to safeguard immediate needs of more powerful actors such as hospitals. The Maritime provinces constitute a ‘natural policy experiment’ where different decisions were made about which services were to be assigned for regional or provincial levels of administration. Of interest are the implications of these policy choices for home care and the extent to which these are affected by whether or not home care is part of the regionalized basket of services. Instead, provincial governments are at liberty to provide it within the limits of their fiscal capacity as all do to some extent, but there are no federal terms and conditions which must be complied with. Given the dynamic nature of health reform coupled with the fact that home care, in contrast to acute hospital care, is not “protected” under the Canada Health Act, information about the advantages and disadvantages of these

223

provincial approaches to regionalization and the consequences for home care should prove of value to regional, provincial, and national health policy makers. RESEARCH CONTEXT This project is part of a 3 year Canadian Institute of Health Research grant awarded to Professors Raisa Deber (thesis supervisor) and Paul Williams. Lawrence Nestman (Dalhousie University - School of Health Administration) is a member of the thesis committee. For more information see www.m-thac.org. or contact Pat Conrad at [email protected] (902-422-4842).

224

Appendix A-4: Consent Form

DO REGIONAL MODELS MATTER? HOME CARE RESOURCE ALLOC ATION IN THE MARITIMES

Canadian Institutes of Health Research Grant # 2590189 Canadian Institutes of Health Fellowship # 22690020

October, 2003 Insert Name Dear Thank you for voluntarily agreeing to participate in our study which examines home care in the context of regionalization. This three-year study has passed an ethics review at the University of Toronto and is funded by the Canadian Institutes for Health Research. It is being conducted by experienced researchers at the University of Toronto: Professors Raisa B. Deber, PhD., A. Paul Williams, PhD., Denise Kouri, Executive Director, Canadian Centre for Analysis of Regionalization and Health and Pat Conrad, Doctoral Candidate. Summary reports of the results will be sent to all participants and more detailed reports will be provided to provincial governments, regional and provincial health organizations and Health Canada. However, all information provided by all individuals will be kept strictly confidential; results will be reported in summary form only. During this study, all information will be secured and will be available only to the researchers. At the completion of the study, all information which could identify individuals will be stripped from the data. These interviews with representatives of regional health organizations to develop a better understanding of how differences in the organization of services under regional health authorities affects home care resource allocation. Your interview is scheduled on [insert date and time]. The interview will be conducted by Pat Conrad. With your written permission, it will be audio-taped solely for the purposes of analysis; after analysis, all tapes will be destroyed. At any time you are free to withdraw your consent and participation. You may stop the tape-recorder at any time or decline to answer any specific questions. If you have any questions, or wish any further information about your interview or any aspect of this study please call collect to Dr. Raisa Deber at (416) 978-8366 or Pat Conrad at (902) 422-4842. You may also contact us by fax at (416) 978-7350 or by email at [email protected]. or [email protected] Sincerely Raisa Deber Pat Conrad Professor and Principal Investigator Doctoral Candidate

225

I have read and understood what my participation in this project will involve. I agree to be interviewed Yes No I agree to have my interview audio-taped Yes No Name (please print): _____________________________ Signature _________________________________ Date _________________________________

226

Appendix A-5: Themes Related to Reallocation of Resources by Health Regions

TEMPLATE TO MATCH PRE-DETERMINED THEMES FROM INTERV IEW RESULTS WITH REGIONAL KEY INFORMANTS

1. Tension between the center/Health Departments and the regions. 2. The focus was on structures and processes not outcomes; clearly established health

outcomes for regions to achieve were not established. 3. Lack of information - Allocations are determined by historical spending by various health

care services; the allocations are not as yet tied to any formal needs assessments conducted by regions.

4. There were no incentives provided to regions to reallocate. 5. There were no penalties or sanctions for regions failing to reallocate. 6. Imperative of fiscal restraint; regionalization implemented era of restraint and cost

containment. 7. There were no champions for resource allocation. 8. Caution by policymakers; there was a lack of trust in regions by Health Departments. 9. Provincial guidelines/conventions - Actions put in place by the Health Departments to

undermine the discretion or ability of regions to reallocate (some examples of these actions are non-portable budgets; not fully disclosing the extent of latitude the regions had to reallocate),

10. There was no evaluative mechanism put in place to assess the extent to which regions were successful in meeting policy goals of resource reallocation.

11. The block funding incentive is directed towards regional board and administrators; even though regions were new, old ways of doing things continued.

12. There were entrenched interests that continued to focus on sustaining programs and maintaining the status quo; Regional administrators and board members were influenced by particular interests to maintain the status quo; (e.g., physicians, hospitals, unions - these interests were often in opposition to the planned directions of provincial health reform).

13. Regions faced too many demands from acute care sector. 14. Some innovations in service delivery may not be captured by budget categories. 15. Program silos continued to prevail in regions (as regions are in reality mini reproductions

of the provincial health departments); various provincial program budgets are manually added to determine the amount of funding to be transferred by the province to each region; but operationally the budgets are still separate.

16. Public opinion limits ability of regions to reallocate since local residents are not educated about population health concepts; health care predominantly means access to hospital-based acute health care.

17. Regions have to balance competing “interests”. 18. Presence of red tape - regions had to put forward proposals to health departments in order

to reallocate.

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Appendix A-6: Provincial Document Review: Templates to Collect Data about Health

Reform, Health Restructuring, and Characteristics of Regional Models

PROVINCIAL DATA ABOUT HEALTH RESTRUCTURING

Name and dates of provincial health reform committees and reports

Underlying political ideas?

Recommendations of health reform commission

Mandate/Mission of health regions

Recommendations of health reform task force Policy objectives/goals of health reform / regionalization

Recommendations of health transition/planning team

Principles guiding health restructuring

Rationale underlying health restructuring Role and functions of Health ministry

Purpose of health reform Role and functions of health regions

Underlying philosophy and ideology

PROVINCIAL DATA ABOUT REGIONAL MODELS

Regional services assigned for regional administration

Functions of Health Ministry

Number of regions and population size Functions of Regional Health Board

Governance - board size, composition Accountability and reporting requirements

Governance - board construction (appointed, elected)

Budget mechanisms e.g., global, integrated, protected budgets, non-portable budgets

228

Appendix A-7: Cross-Case Comparison of Health Reform and Regional Models

CRITERIA TO COMPARE PRINCE EDWARD ISLAND, NOVA SCOT IA, AND NEW BRUNSWICK HEALTH REFORM APPROACHES AND REGIONALIZAT ION

MODELS

What are the differences among the regional models?

What are the similarities among the regional models?

Degree/extent of change - narrow/limited, medium, wide/broad

Array of services regions delivered - narrow, medium, wide

What ideas are behind the regionalization model? What is the purpose of the reform/change? e.g., administrative reform (narrow) to population health perspective (wide)

How was the reform interpreted by regional stakeholders? 1) What is the interpretation by regions of how they should operate? 2) What is the interpretation by bureaucracy of how should operate?

What were the circumstances which have circumscribed the interpretations? 1) consider ideas e.g., that of government 2) consider interests e.g., power of hospitals/acute care vs. home care; central tension vs. local autonomy 3) consider institutions e.g., rule of the game, structures

Interpretation of findings? outcomes?

229

Appendix A-8: Provincial & National Government Health Expenditures by Use of Funds

Nova Scotia - Provincial Government Health Expendit ures by Use of Funds, Percentage Distribution, 1990 /91 - 2000/01 Current Dollars Source: CIHI (2004) Table C.3.2, p.52 90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01 Hospitals 58.8 59.9 60 55.3 54 53.1 53.7 56.5 53.7 52.4 50 Other institutions 7.5 7.8 7.8 8.2 8 10.8 11 9.8 10.8 11.8 12.7 Physicians 16.8 16.8 16.6 16.4 15.3 15.5 15.5 15.7 20.2 19.8 18.8 Other professionals 1.8 1.3 1 0.9 1 1 0.9 0.6 0.7 0.6 0.6 Drugs 6.4 6.2 6.7 6.7 6.4 6.4 6.3 6.4 6.2 6.3 6.6 Capital 4 3 2.6 2.9 4.1 3 0.8 1.8 1.3 2 2.1 Public Health & Administration 2.9 3.2 2.9 2.9 3 2.5 2.6 3.2 2.4 2.4 2.8 Other Health spending 3.3 3.2 3.3 2.9 3.8 4.4 4.4 4.8 5.8 5 5.2

PEI - Provincial Government Health Expenditures by Use of Funds, Percentage Distribution, 1990/91 - 20 00/01 Current Dollars Source: CIHI (2004) Table C.2.2, p.48 90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01 Hospitals 54.3 52.2 52.2 52.2 54.9 55.4 53.4 52.5 49.6 50.7 48.4 Other institutions 14.5 13.5 14.7 16 12.8 12.9 14.4 13.8 12.8 13.2 13.1 Physicians 16.3 15.5 16.3 15.1 15.7 15.5 15.1 15.7 15.6 15.1 15.1 Other professionals 1.1 1 1.1 1 1 0.9 0.9 0.9 0.9 0.9 0.9 Drugs 3.9 3.9 3.9 3.6 3.9 4.2 3.9 4.4 4.8 5 5.5 Capital 0.8 4.5 2.7 3.7 2.1 1 2.1 1.8 4.5 3.2 3.5 Public Health & Administration 4.6 4.8 4.4 4.3 4.2 4.2 5.3 6 7.4 6.8 8.5 Other Health spending 4.5 4.5 4.8 4.1 5.4 5.8 4.9 4.9 4.6 5 5

230

New Brunswick - Provincial Government Health Expend itures by Use of Funds, Percentage Distribution, 19 90/91 - 2000/01 Current Dollars Source: CIHI (2004) Table C.4.2, p.56 90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01 Hospitals 52.8 54 55 53.1 52 50.1 51.8 51.4 51.1 51.1 51.4 Other institutions 10.2 10.2 11.8 12.1 11.7 11.2 11.4 12 11.8 11.4 11.1 Physicians 16.2 17.2 16.7 17.1 17.4 16.7 17.5 18.7 18.2 18.4 18.1 Other professionals 0.6 0.7 0.6 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.3 Drugs 5.8 5.7 5.1 4.9 4.7 4.7 4.3 4.7 5 5 5.4 Capital 7.1 4.5 4 3.5 4.9 7.6 5.3 2.7 2.6 2.5 2.5 Public Health & Administration 3.9 3.7 2.9 4.2 4.2 4.5 4.8 5 5.1 5 4.8 Other Health spending 3.9 4 4 4.8 4.7 4.8 4.9 5.1 5.9 6.3 6.4 Canada - Provincial Government Health Expenditures by Use of Funds, Percentage Distribution, 1990/91 - 2000/01 Current Dollars Source: CIHI (2004) Table B.2, p.40 90/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/00 00/01 Hospitals 49.2 49 48.5 48.4 46.6 46.1 45.7 44.9 44.9 42.9 43.4 Other institutions 9.8 9.7 10 9.5 9.7 10.2 10.5 10.6 10.3 10.5 10.6 Physicians 21.3 21.7 20.8 21.1 21.5 21 21.4 21.3 20.9 20.1 19.8 Other professionals 1.9 1.8 1.7 1.6 1.6 1.5 1.5 1.4 1.3 1.3 1.2 Drugs 5.1 5.3 5.7 5.8 5.8 6.5 6.1 6.2 6.5 6.8 7.4 Capital 3.8 3.2 3.1 3 3.8 3.3 3.2 3.3 3.3 5 4.5 Public Health & Administration 4.1 4.1 4.5 4.8 5.3 5.5 5.9 5.9 6.5 6.9 6.8 Other Health spending 5.2 5.3 5.8 5.7 5.9 5.9 5.9 6.3 6.3 6.4 6.3

231

Appendix B-1: Provincial Population, Prince Edward Island

Provincial Population, Prince Edward Island, 1991-2 001Data Source: CIHI (2003) Appendix C.1

126

128

130

132

134

136

138

Year

'000

PEI 130.3 130.8 132.1 133.4 134.4 135.8 136.1 135.8 136.3 136.5 136.7

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001

232

Appendix B-2: Proportion of Prince Edward Island & Canada, 65 years+

Proportion of Prince Edward Island & Canada Populat ion, 65 years +, 1996-2001 Data Source: CIHI (2003) Appendices C.2 - C.7

11

11.5

12

12.5

13

13.5

14

perc

et

PEI 12.9 13 13.3 13.4 13.4 13.6

Canada 12.1 12.6 12.3 12.5 12.6 12.7

1996 1997 1998 1999 2000 2001

233

Appendix B-3: Total Provincial Government Expenditures, Prince Edward Island

Total Provincial Government Expenditures (includes debt charges), Prince Edward Island, 1991 to 2001 - Current dollars Data Source: CIHI ( 2003), Appendix D-2

0

200

400

600

800

1000

1200

Year

$'00

0,00

0

Total Expenditures 796 824 973 880 833 850 848 874 925 1011 1050

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001

234

Appendix B-4: Governments of Prince Edward Island, 1990-2001

YEAR GOVERNMENT AND PREMIER

1990 Liberal - Ghiz

1991 Liberal - Ghiz

1992 Liberal - Ghiz

1993 Liberal - Callbeck Election March 29, 1993

1994 Liberal – Callbeck

1995 Liberal – Callbeck

1996 PC - Binns Election November 18, 1996

1997 PC – Binns

1998 PC – Binns

1999 PC - Binns

2000 PC - Binns Election April 17, 2000

2001 PC - Binns

235

Appendix B-5: Prince Edward Island Health Reform Milestones

CHRONOLOGY OF HEALTH REFORM IN PRINCE EDWARD ISLAND

DATE EVENT

1991 Cabinet recommendation to create a Task Force on Health

1992 PEI Health Task Force. Health Reform - A Vision for Change.

May, 1993 Working Group Report. Provincial Health Policy Council.

1993 PEI Health Transition Team. Partnerships for Better Health.

1993 Legislation: Health and Community Service Act, Bill No. 33 given royal assent in August and proclaimed in October

1994 April 1, 1994 health and community services are transferred to RHAs. PEI Health and Community Services Agency. Core Services for Prince Edward Island’s Health and Community Services.

1994 PEI Health and Community Services Agency. Overview of the Health and Community Services System.

1995 Ministry of Health and Social Services. Health and Community Services Provincial Plan.

1995 PEI Health & Community Services Agency. Prince Edward Island Health Reform Strategy: Strengthening Families, Individuals and Communities.

April, 1996 Report of the Home Care Support Working Group. The Home Care Support Program of PEI Framework Document.

September, 1996 Coordinated point of entry system implemented by the regions New assessment process for Continuing Care

June, 1997 PEI System Evaluation Project - Volume I: A Guide to System Evaluation: Assessing the Health and Social Services System in PEI

July, 1997 PEI System Evaluation Project - Volume II: Data Collection Instruments for Evaluating Health and Social Services Systems

1997 Seniors Assessment Screening Tool introduced (SAST).

October, 1998 PEI System Evaluation Project - Decision Support Tools for Cross-sectoral Investments in Population Health in the Context of Health System Change. Report to Health Canada.

1999 Announcement to reconfigure Regional Health Boards to a combination of elected and appointed members

236

November, 1999 First election held to elect regional Health board members

February, 2000 PEI Home Care Support Program Guidelines.

March, 2000 Continuing Care Programs and Services Overview.

September, 2000 Screening Tool - Index of Prompts / Interpretation.

April, 2002 Restructuring Plan announced: - amalgamation of Eastern Kings and Southern Kings into Kings Health Region - creation of Provincial Health Services Authority to oversee planning and delivery of secondary and specialized acute services at Queen Elizabeth Hospital (Charlottetown), Prince County Hospital (Summerside), Hillsborough Hospital, and the Provincial Addictions Centre

237

Appendix B-6: Prince Edward Island Legislation: Health and Community Services Act, Bill No. 33

PRINCE EDWARD ISLAND

HEALTH AND COMMUNITY SERVICES ACT, BILL NO. 33

Role of Minister The Minister of Health and Community Services administers the act. The role of the Minister is described as: “ensuring the provision of essential health and community services in the province” and “leading the health and community services system to promote and maintain the good health and social well-being of the residents of the province (Chapter H-1.1, Health and Community Services Act, p.1)

Purpose of regions Regional authorities are to “provide for the delivery of health and social services” (Chapter H-1.1, Health and Community Services Act, p.3)

Duties/Functions of Regions

Regional authorities shall: a) manage or provide for delivery of core programs and services; b) ensure that the prescribed standards respecting core program and the quality of services are adhered to; c) operate institutions and facilities; d) manage the financial affairs, personnel, and other resources necessary for the delivery of health and community services, and e) perform other function as the Minister may direct (Chapter H-1.1, Health and Community Services Act, p.3)

Accountability Regional authorities are accountable to the Minister. Various instruments of accountability are mentioned in this legislation. These include: 1) preparation of annual report (p.4); 2) submission of yearly audited financial statements (p.5); 3) holding an annual public meeting to report about the operation of the authority and provision of health and community services (p.5) (Chapter H-1.1, Health and Community Services Act, pp.4-5)

Board of Directors The Board is constituted in accordance with the regulations. From the time regional authorities were implemented in 1994, the board was appointed by the Minister. Board members were also paid. (Chapter H-1.1, Health and Community Services Act, p.3)

CEO appointment

The Minister appoints the CEO upon recommendation of the board. (Chapter H-1.1, Health and Community Services Act, p.4)

238

Appendix C-1: Provincial Population, Nova Scotia

Provincial Population, Nova Scotia, 1991-2001Data Source: CIHI (2003), Appendix C.1

905

910

915

920

925

930

935

940

Year

'000

NS 915.1 919.6 924 927 928.2 931.4 932.5 931.9 933.8 933.9 932.4

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001

239

Appendix C-2: Proportion of Nova Scotia & Canada Population, 65 years+

Proportion of Nova Scotia & Canada Population, 65 y ears +, 1996-2001 Data Source: CIHI (2003) Appendices C.2 - C.7

11

11.5

12

12.5

13

13.5

14

perc

ent

NS 12.9 13.1 13.2 13.3 13.5 13.7

Canada 12.1 12.6 12.3 12.5 12.6 12.7

1996 1997 1998 1999 2000 2001

240

Appendix C-3: Total Provincial Government Expenditures, Nova Scotia

Total Provincial Government Expenditures (includes debt charges), Nova Scotia, 1991 to 2001 - Current dollars Data Source: CIHI ( 2003), Appendix D-2

0

1000

2000

3000

4000

5000

6000

7000

Year

$'00

0,00

0


1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001

241

Appendix C-4: Governments of Nova Scotia, 1990-2001

YEAR GOVERNMENTS AND PREMIER

1990 PC – Buchanan



1993 Liberal - Savage Election May 25, 1993

1994 Liberal – Savage

1995 Liberal - Savage

1996 Liberal - Savage Election September, 1996

1997 Liberal – Savage

1998 Minority Liberal - MacLellan Election March 24, 1998

1999 PC - Hamm Election July, 1999

2000 PC – Hamm

2001 PC – Hamm

242

Appendix C-5: Nova Scotia Health Reform Milestones

CHRONOLOGY OF HEALTH REFORM OF NOVA SCOTIA

DATE EVENT

August, 1987 Royal Commission on Health Care appointed

September, 1988 Report: NS Royal Commission on Health Care. Issues and Concerns - Summary of Public Hearings and Submissions

December, 1989 Report: NS Royal Commission on Health Care. Towards a New Strategy - Report of Royal Commission on Health Care

February, 1990 Speech from Throne - Progressive Conservative Government indicated general acceptance of Royal Commission Report. Announcement of health reform initiatives: 1. Provincial Health Council; 2. Task Force on Nursing; 3. Modified Pharmacare Program; 4. Policy on physician services; 5. Community Health Promotion Fund

April, 1990 Minister of Health’s Implementation Committee announced. Mandate: 1. to respond to Royal Commission 2. to elaborate a new strategy for health

November, 1990 Report: NS Department of Health. Health Strategy for the Nineties: Managing Better Health (Government’s response Royal Commission)

December, 1990 Provincial Health Council appointed

February, 1991 Task Force on Nursing appointed

April, 1991 Task Force on Physician Policy Development Appointed

September, 1991 Health Services & Insurance Commission and Commission on Drug Dependency integrated into Department of Health

April, 1992 - Report: NS Department of Health. Actions Taken in Response to the Recommendations of the NS Royal Commission on Health Care - Creation of regional offices in Northumberland and Cape Breton - Task Force on Primary Health Care created - Draft Health goals produced by Provincial Health Council

August, 1992 Provincial Health Goals signed by Premier

October, 1992 Working Group on Mental Health created

January, 1994 Ministerial Action Committee on Health System Reform (Blueprint Committee) appointed

243

1994 An Act to Establish Regional Health Boards, Bill 95, was passed by the legislature

April, 1994 Report: Ministerial Action Committee on Health System Reform. Nova Scotia’s Blueprint for Health System Reform

September, 1994 Volunteer Board members of Interim Regional Health Boards appointed by Minister of Health Department of Health/Regional Health Board Committee re: process to establish Community Health Boards initiated

April, 1995 Report: Nova Scotia Department of Health. From Blueprint to Building - Renovating Nova Scotia’s Health System.

August, 1995 Report: Department of Health/Regional Health Board Committee. Community Health Board Development Community Health Planning Guidebook Series

April, 1996 Provincial Programs and Services Board established

NS Hospital became independent corporation

January, 1996 Regional Health Boards assume responsibilities for hospital governance;

April, 1997 Regional Health Boards assume responsibility for drug dependency and public health programs

September, 1997 Report: Department of Health. Regionalization of Health Systems in Canada - An Overview

December, 1997 30 CHBs established with 420 members

February, 1998 Report: Nova Scotia Department of Health. Health Care Update: Regionalization.

April, 1998 38 CHBs established with 520 members

1997 Representatives from Community Health Boards comprise membership of Regional Health Boards

October, 1998 Task Force on Regionalized Health Care announced

September, 1999 Report of Task Force on Regionalized Health Care released.

October, 1999 Governance of Regional Health Boards transferred to Department of Health

244

November, 1999 Hospital Board Transition Plan released - plan to restructure health care delivery system which is to be more community-responsive through establishment of 9 district health authorities with formal links to community health boards.

District Health Authority Board appointments announced

December, 2000 CEOs of District Health Authorities announced

2001 Health Authorities Act (Bill 34) comes into effect. DHAs replaced Regional Health Authorities.

March, 2001 Report of Clinical Services Steering Committee released.

245

Appendix C-6: Nova Scotia Legislation: Act to Establish Regional Health Boards, Chapter 12 of the Acts of 1994

ACT TO ESTABLISH REGIONAL HEALTH BOARDS,

CHAPTER 12 OF THE ACTS OF 1994

Role of Minister The Minister of Health has the general supervision and management. The role of the Minister is not specified beyond this statement. (Section 3, p.1)

Purpose of regions Not specified

Accountability Not specified

Board of Directors The members of the regional health board shall be selected on an interim basis by the Minister or in accordance with the regulations.

CEO appointment Not specified

Duties/Functions of regions

Regional authorities shall operate and manage the designated hospitals within the health region. A regional health board shall determine the number and type of hospitals in the health region, consistent with health care planning for the region. (Section 6 parts 1 and 2, p.2) A regional board where authorized by the regulations - develop regional health service plans.... - rationalize institutional health services.... - develop a regional health human resources plan... - fund regional health programs and services... - recommend to the Minister the core programs.... - participate in development of a provincial health plan - participate in the development of tertiary and provincial health programs - conduct regular and systematic evaluation of the regional health systems; (Section 7, p.4) Further duties - establish community health boards - determine the community within which a community health board is to exercise jurisdiction - determine the method of selection of the membership of a community health board - determine the term of office for members of a community health board; (Section 8, p.5)

246

Appendix D-1: Provincial Population, New Brunswick

Provincial Population, New Brunswick, 1991-2001Data Source: CIHI (2003), Appendix C.1

742

744

746

748

750

752

754

Year

'000

NB 745.5 748.1 748.8 750.2 751 752.3 752.5 750.6 750.6 750.5 749.9

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001

247

Appendix D-2: Proportion of New Brunswick & Canada Population 65 years+

Proportion of New Brunswick & Canada Population, 65 years +, 1996-2001 Data Source: CIHI (2003) Appendices C.2 - C.7

11.4

11.6

11.8

12

12.2

12.4

12.6

12.8

13

13.2

13.4

perc

ent

NB 12.5 12.7 12.9 13 13.1 13.3

Canada 12.1 12.6 12.3 12.5 12.6 12.7

1996 1997 1998 1999 2000 2001

248

Appendix D-3: Total Provincial Government Expenditures, New Brunswick

Total Provincial Government Expenditures (includes debt charges), New Brunswick, 1991 to 2001 - Current dollars Data Source: CIHI ( 2003), Appendix D-2

0

1000

2000

3000

4000

5000

6000

Year

$'00

0,00

0


1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001

249

Appendix D-4: Governments of New Brunswick, 1990-2001

YEAR GOVERNMENT AND PREMIER

1990 PC

1991 Liberal - McKenna Election September 23, 1991

1992 Liberal – McKenna



1995 Liberal - Frenette (Acting) / Theriault Election September, 1995

1996 Liberal – Theriault

1997 Liberal - Theriault

1998 Liberal – Theriault

1999 PC - Lord Election June, 1999

2000 PC – Lord

2001 PC – Lord

250

Appendix D-5: New Brunswick Health Reform Milestones

CHRONOLOGY OF HEALTH REFORM IN NEW BRUNSWICK

DATE EVENT

1989 McKelvey, EN and Sister Bernadette Levesque. Report of the Commission on Selected Health Care Programs.

1990 Province of New Brunswick. Health 2000 - Toward a Comprehensive Health Strategy.

1992 NB Health and Community Services. A Health and Community Services Plan for New Brunswick,

March, 1992 Plan for restructuring health care announced and implemented: Consolidation of hospital governance into eight regional boards; elimination of 51 hospital boards

May, 1992 Hospital Act passed.

1993 NB Health and Community Services. Long-term Care Strategies.

1994 NB Health and Community Services. The Redefinition of Canada's Health System.

1995 NB Health and Community Services. Reinvesting in a Sustainable Health System.

1996 NB Health and Community Services Making Health and Community Services Sustainable. Extra-mural Hospital restructured from free-standing organization to become the Extra-mural Program under the Department of Health and Community Services; EMP services become regionalized

1997 NB Health and Community Services. Master Plan for 1997 New Brunswick Hospital System.

February, 1999 New Brunswick. Health Services Review: Report of the Committee.

January 2000 Establishment of Premier’s Health Quality Council

February 2000 NB Health and Community Services. Building On Our Strengths: A Framework for Region Hospital Corporation Accountability.

251

November 2000 Announcement about health restructuring by Conservative government: - Establishment of regional health authorities announced in Speech from the Throne - Reorganization of Health and Community Services Ministry consisting of the establishment of two separate Ministries - Health and Wellness and Family and Community Services.

ND NB Health and Wellness: Re-organization Plan

January 2002 Health Renewal - Report from the Premier’s Health Quality Council

April, 2002 Implementation of Regional Health Authorities replaced Regional Hospital Corporations

252

Appendix D-6: New Brunswick Legislation: The Hospital Act, Chapter H-6.1

THE HOSPITAL ACT, CHAPTER H-6.1 (CONSOLIDATED TO JUNE 2000)

Role of Minister Outlined in Section 35 under the Lieutenant-Governor in Council

Purpose of regional hospital corporations

To establish, operate, and maintain hospital facilities To deliver hospital services in the hospital facilities established, operated and maintained To deliver those services that are extra-mural services within the geographic area or areas specified by the Minister To engage in programs to train persons in the medical and allied professions To do such things as approved by the Minister or prescribed by regulation (Section10, page 15)

Duties / Functions of regions

Shall ensure that hospital services delivered by the hospital corporations are delivered within the parameters established and the directions issued by the Minister Shall ensure that hospital services delivered by the hospital corporations are delivered within established Provincial quality and efficiency standards Shall ensure the land, buildings, and building service equipment are entrusted to the hospital corporation by the Crown in the right of the Province are used for the purpose for which they were received and are well maintained so as to be available as required to support the delivery of hospital services Section 13, p.17

Board of Directors

The first members of the regional hospital corporations shall be appointed by the Minister From among the first members, the chairperson shall be appointed by the Minister Members and chairpersons serve at the pleasure of the Minister First appointments terminate June, 1994 (Section 12, page 16)

CEO appointment The Minister shall appoint the first CEO Section 15, p.17

253

Accountability A hospital corporation shall: - maintain books, accounts and accounting systems and perform audits in accordance with the regulation - operate within the budget approved by the Minister under the Hospital Services Act - submit an annual report, including a financial statement in such form and containing such information as may be required by the Auditor General and an auditor’s report on the financial statement to the Minister on or before the 31st day of July in each year for the preceding fiscal year, and - conduct such additional analysis in relation to any aspect of the operations of the hospital corporation or of a hospital facility operated or maintained by the hospital corporation as may be required by the Auditor General, and attach to the annual report the results of the analysis ad such other information in relation to it as may be required by the Auditor General. Section 25, pages 20-21.

254

Appendix E-1: Proportion of Population 65 years+

Proportion of Population 65 years+ for Prince Edwar d Island, Nova Scotia, New Brunswick, Canada, 1996-2001

Data Source: CIHI (2003) Appendices C.2 - C.7

11

11.5

12

12.5

13

13.5

14

Per

cent

PEI 12.9 13 13.3 13.4 13.4 13.6

NS 12.9 13.1 13.2 13.3 13.5 13.7

NB 12.5 12.7 12.9 13 13.1 13.3

Canada 12.1 12.6 12.3 12.5 12.6 12.7

1996 1997 1998 1999 2000 2001

255

Appendix E-2: Total Provincial Government Expenditures

Total Provincial Government Expenditures (includes debt charges), Prince Edward island, Nova Scotia, New Brunswick,1991 to 2001 - Current d ollars

Data Source: CIHI (2003), Appendix D-2

0

1000

2000

3000

4000

5000

6000

7000

year

Dol

lars

- '0

00,0

00

PEI 796 824 973 880 833 850 848 874 925 1011 1050

NS 4717 5151 5013 4993 5142 4999 5050 5380 5723 5790 6220

NB 4339 4509 4612 4765 4840 4822 4844 5062 5464 5397 5636

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001

NS Election May/93 Liberal majority

NS electionSept/96Liberal majority

NS electionMar/98Liberal minority

NS electionJuly/99PC majority

NB electionSept/91Liberal majority

NB electionSept/95Liberal majority

NB electionJune/99PC majority

PEI electionMar/93Liberal majority

PEI electionNov/96PC majority

PEI electionApr/00 PC majority

NS Regionalization

NB regionalization

PEI regionalization

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