CALGARY — A lawyer for Alberta’s health-care provider argued in a Calgary court Monday that a private hospital teetering on bankruptcy should be kept open to allay fears the public may have about cancelled surgeries and longer wait times.
Josef Kruger asked a Court of Queen’s Bench judge to appoint PricewaterhouseCoopers Inc. as the interim receiver for the Health Resource Centre, which performs about 1,000 publicly funded hip, knee, foot and ankle surgeries a year.
An ongoing legal dispute between Networc Health Inc., which owns the Calgary-based centre, and creditor Cambrian Group of Companies has the facility on the verge of shutting down.
“There is real urgency here,” Kruger said. “We need to calm fears from the public that they will not have access to this facility and that they will not have longer wait times.”
Alberta Health Services wants the interim receiver to be in place and bankruptcy proceedings stayed for 10 months to give the health system a chance to prepare for an additional 1,000 patients a year.
“We don’t have those operating rooms now,” said Kruger.
But Michael Smith, the lawyer for Cambrian, questioned whether Alberta Health Services should even have legal standing to request an interim receiver.
“I know of no case in Canada where the customer applies for a receiver to be appointed in a bankruptcy so that the bankrupt can continue to supply services to the customer at rates that are driving the supplier bankrupt. That’s unprecedented,” Smith said in an interview outside the hearing.
The centre was originally the Salvation Army Grace Hospital, one of three Calgary hospitals closed in the mid-1990s. It has been performing surgeries under contract to the former Calgary Health Region for the last four years.
Queen’s Bench Justice Barbara Romaine eventually granted the AHS request but only in a limited way. She appointed PricewaterhouseCoopers the interim receiver for one week. The matter will return to court May 11.
“This is an unusual case. This is a great public concern,” she said.
But all the interested parties seem to be going back to square one next week.
The issues of whether a stay of bankruptcy proceeding should be granted and whether AHS has legal standing to request an interim receiver “will be on the table,” said Romaine.
The Chief Financial Officer for Alberta Health Services said it was a small victory.
“I think it’s a step in the right direction as we move to protect patient care services in the city of Calgary for our orthopedic services,” said Chris Mazurkewich.
AHS will foot the bill to cover the interim receiver, which could run as high as $250,000. Mazurkewich said Health Resource Centre does about one-third of the hip, knee, foot and ankle surgeries in the province. Although AHS is working on a contingency plan, it needs the Health Resource Centre to remain open for now, he added.
“We can find some of the capacity. We can’t find 100 per cent,” he said.
“The Alberta government is asking the courts to help them out when they dropped the ball on making sure the private hospitals have an opportunity to compete with each other to deliver services at a reasonable price to the taxpayer,” said Smith.
“Coincidentally, (the 10-month stay) would provide the government with these services at the expense of the creditors of Networc until they think they can replace it with their in-house.”
Smith called the concerns about patient health a “red herring.”
“These are elective patients. Nobody is going to be deadly ill, no one’s life is in danger.”
Cambrian said it is owed $65 million by HRC as a result of a new health centre that has been built in northwest Calgary. The 10-year lease called for the centre to pay $500,000 in rent per month.
HRC asked for the facility even though its contract to provide services to AHS expires in 2011.
Mazurkewich said he wasn’t sure what would have prompted HRC to plan to expand.
“I think you have to ask that organization why. It may come out as we do through the proceedings. I just don’t have the answer to that,” he said.