2013-16 Health, Business Plan guides AHS transformation

May 29, 2013

Focusing resources on priority areas helps AHS get more value from every dollar

EDMONTON — Alberta Health Services (AHS) today releases its 2013-2016 Health Plan and Business Plan, which outlines increased funding in priority areas and transformational initiatives designed to improve quality of care and efficiencies across the health system.

The plan, approved this spring by the AHS Board and Alberta Health, include 2013-14 funding for areas that matter most to Albertans, such as continuing care, emergency care, surgical care, outpatient care, obstetrics, pediatrics and mental health.

The plan also sets forth strategies to find cost-savings that can be redirected to priority areas, ensuring AHS gets more value out of every health dollar. (See backgrounder for details.)

“As Alberta’s population grows larger and older, we must build a health care system that meets today’s needs but also the needs of tomorrow,” said Fred Horne, Minister of Health. “The AHS Health Plan and Business Plan directs resources toward high priority areas, which positions our health system to respond to future challenges, deliver better health outcomes and achieve health system sustainability.”

Last month, the AHS Board approved a $13.355-billion 2013-14 operating budget that includes a 4.9 per cent increase in revenue, representing $626 million, over the previous fiscal year. The 2013-2016 Health Plan and Business Plan calls for a balanced budget with an average daily spend of about $37 million in 2013-14 to support the health system.

“This is a time of transformation at AHS. We need more from every health dollar,” said AHS Board Chair Stephen Lockwood. “We’re going to find cost-savings and redirect those dollars to where they will have a greater impact. Changes are coming but Albertans can rest assured we will be there for them, and we will care for the people who need us most: the frail elderly; high-needs children and youth; and those at the end of life.”

The following priority areas are receiving significant funding increases for 2013-14 from the restated 2012/13 Budget (*See note below on restated budget):

The plan also calls for $245 million to be allocated for new investments, such as additional neonatal intensive care spaces at Alberta Children’s Hospital in Calgary; the opening of a new cancer centre in Red Deer; and ongoing work by Strategic Clinical Networks, which are improving the delivery of care in priority areas by creating standardized care pathways based on best practices.

“We are aiming for better quality, better outcomes and better value,” said Dr. Chris Eagle, AHS President and CEO. “We’re engaged in an ongoing dialogue with Albertans through our Health Advisory Councils, our Patient Family Advisory Group, and our community meetings/open houses and information sessions. What we hear is this: Albertans want us to simplify the health system so they know how and where to get the care they need. They want local leaders to make more decisions about health care delivery in their communities. And they want AHS to spend health dollars on services that matter most to Albertans. Our health and business plan was developed with those themes in mind and the wishes of Albertans will guide our transformation.”

To help fund new investments, AHS will also achieve savings totalling about $220 million in 2013/14 by eliminating duplication of services; by finding more efficient ways to deliver services; by containing costs associated with delivering health care; and by seeking new revenue opportunities. This may involve closing beds where they are not urgently needed; scaling back or eliminating programs and services that don’t drive improvement in priority areas; and redeploying staff where they can make the biggest difference on patient outcomes.

In addition to addressing the increasing costs to deliver health services, these efficiencies are needed to address increasing demand on services: Alberta’s population is growing (compound rate of 2.2 per cent in last 10 years) and aging; the number of Emergency Department visits is increasing; and there is a significant number of Albertans with complex and/or chronic conditions who don’t currently have access to community-based services.

Alberta has the lowest health care administrative costs as a percentage of total expenses in Canada, and AHS will continue to streamline, reducing administrative and overhead costs by $35 million over the next three years.

“We have decisions to make, and some will be tough. I can assure Albertans these decisions will always begin and end with quality and safe patient care as the first priority,” said Dr. Eagle.

The goal, he adds, is to concentrate resources and efforts toward community-based and primary care services, which will allow AHS to provide Albertans the most appropriate care closer to home and to help them get healthy and stay healthy, so they’re less likely to require hospital care.

The 2013-2016 Health Plan and Business Plan is online at www.albertahealthservices.ca/8545.asp.

* Budget restatement note:

During fiscal 2012-13, the budget was restated in order to reflect the transition to Public Sector Accounting Standards. Further affecting the budget are the budget system reclassifications and the realization of key budget assumptions.

The 2012-13 budget was prepared at the financial statement level and approved by the Board in May 2012. After the new budget was approved, AHS implemented a new AHS budgeting and planning system. AHS used the new system to rebuild the budget at the cost centre level, using the same assumptions as the original budget. This implementation has led to improved reporting capabilities and increased accuracy of its detailed budget, allowing for greater accountability and transparency. The rebuilt budget was used for management accountability reporting during 2012-13 and is accounted for in the variance analysis outlined in the AHS financial statements.The original and rebuilt budgets have the same total revenue and expenses and the same functional assumptions. The resulting differences are referred to as “budget system reclassifications,” and cannot be attributed to any change in assumption, program or specific initiative.

Alberta Health Services is the provincial health authority responsible for planning and delivering health supports and services for more than 3.8 million adults and children living in Alberta. Its mission is to provide a patient-focused, quality health system that is accessible and sustainable for all Albertans.

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