Don’t let bonus derail the plan

Applying a corporate management ethos to health-care delivery in Alberta can work — but it requires the kind of guidance that, to this point, Premier Ed Stelmach and his cabinet have failed to provide.

Applying a corporate management ethos to health-care delivery in Alberta can work — but it requires the kind of guidance that, to this point, Premier Ed Stelmach and his cabinet have failed to provide.

The current outcry over benefits paid to senior executives at Alberta Health Services is predictable. CEO Stephen Duckett was paid $149,000 in bonuses and other benefits, for a total of $744,000 in remuneration for the fiscal year 2009-2010 (including a base salary of $595,000 and $10,000 in benefits such as pension contributions). In total, he and six health services vice-presidents received almost $1 million in bonuses and $5.8 million when including benefits and salary.

These are difficult times and many Albertans — including many in the public sector — have faced wage freezes and worse. Few Albertans make the kind of money this select group makes.

On the surface, the bonuses seem indefensible, particularly when Alberta Health Services operated in 2009-2010 with a deficit of $885 million. General targets were missed, waiting lists grew and Albertans suffered.

But Duckett and his 79 vice-presidents are responsible for the administration of an $11-billion health-delivery system and the 90,000 Albertans who work in that system.

They are retooling a system that has received failing grades for years. It was top-heavy, slow and cumbersome (the previous regional management system included 144 vice-presidents).

It is a system that has been repeatedly undermined by bad political choices made by leaders who were more concerned with optics and dollars than the health of Albertans.

“If we want to have the best health-care system‚ and Albertans do — it costs us to have that. Good management costs money,” says Alberta Treasury Board president Lloyd Snelgrove.

He has a point, particularly when only seven of 80 senior managers were paid bonuses based on meeting at least some of their targets.

But how does Snelgrove argue his point when Stelmach seems intent on undercutting the philosophy of performance-based management and efficiency-driven structure? How does Snelgrove make Stelmach see the necessity of paying skilled, experienced people what the market dictates, and the obligation to meet contracts?

This week, Stelmach mused that “it’s time where we have to look at a different model to reimburse CEOs, especially public authorities.” He said that he’s asked Health Minister Gene Zwozdesky to review the system and “to come back to me personally to see how we can do this differently.”

The message seems to be that although a structure was put in place, and entrusted to a superboard with a broad set of business and health-delivery skills, Stelmach is reluctant to let it run its course. Essentially, it would seem that his trust in the structure he built and the people he appointed is now wavering.

The bonuses were approved by the health superboard, and cabinet, based on contracts signed in good faith, working with criteria agreed by all parties.

Perhaps the contracts lack the clarity they should contain, as the Liberals have complained. Perhaps 79 vice-presidents is still too many and that more of the $11 billion invested in the health system needs to filter down to primary care. Certainly there is a crying need in every community for more beds, more practitioners and more imaginative ways of delivering care.

It may even be that the structure Stelmach has put in place and entrusted to Duckett and the superboard is faulty and needs to be altered.

But the work of improving health care in Alberta shouldn’t be derailed by an outcry over a mere $1 million in bonuses paid to a small group of executives who are trying to meet government-mandated targets.

Stelmach would serve Albertans far better by helping the superboard, and Alberta Health Services executives, to define and establish a quality health-care system. Undermining them won’t accomplish anything.

John Stewart is the Advocate’s managing editor.