It appears the B.C. Health Ministry is about to embark on a major reorganization of medical laboratories across the province. Enabling legislation has been tabled that gives the minister, in essence, authority to do as he wants. The question is, what does he want?
B.C. has a long history of paying too much for laboratory services such as blood tests and tissue biopsies. Numerous reviews have been written, and they all identify two problems.
First, there is a huge amount of duplication and over-supply. A recent report found that B.C. has 50 per cent more lab space per capita than Ontario.
The result is 鈥渞edundant capacity,鈥� 鈥渆xcessive repeat testing鈥� and 鈥渇ragmentation of patient care through different laboratory information systems.鈥�
Second, the funding model is broken. B.C. uses a fee-for-service system introduced during the era of manual lab work.
Now, with automated systems reading hundreds of samples per hour, the fees often bear no relationship to the costs involved.
And volume billing has unintended consequences. It used to be said that clinicians who run laboratories are the doctor鈥檚 doctor. It鈥檚 their job to ensure that tests are medically necessary and relevant.
But with a fee system that rewards higher volumes, lab directors have no incentive to discourage over-testing 鈥� quite the opposite, in fact.
During the past decade, ministry staff have made what improvements they can. Fee levels have been trimmed, caps have been set on the amount private facilities can bill, and some hospital labs in the Lower Mainland have been merged.
Further economies will require a political decision. One option would be to force through a major consolidation. That would maximize economies of scale. It would also improve quality of care by enabling patient records to be linked more effectively.
Currently, B.C. has about 100 public labs (mainly hospital-based), and 130 private facilities, most of them in the Lower Mainland and on 91原创 Island. In theory, all of the analysis done at private sites in these two regions could be handled by one or two centralized laboratories. So could much of the routine hospital work.
It鈥檚 unlikely we鈥檒l see that much compression. Nevertheless, the enabling legislation hints at greater streamlining, and perhaps an end of fee-for-service billing. The difficult political question is, who runs the new system?
The easiest answer would be to leave ownership as it is, divided between the public and private sectors.
Yet the ideal, at least for simplicity鈥檚 sake, is one unified service with one owner. That appears to be the way things are going elsewhere.
Some provinces in Canada have brought lab services under government control. Every insured medical test in Quebec is performed in facilities operated by the province. In Alberta, only 13 out of 150 labs remain in private hands. Virtually all insured lab work in Calgary is conducted in public facilities.
Other jurisdictions have moved in the opposite direction. In parts of New Zealand and the U.S., medical testing has been contracted out entirely to private facilities.
The objective in either case is the same: An end of fragmentation. But the political challenge is enormous.
Could the current B.C. Liberal government, with its close ties to business, take over private labs? An NDP administration might.
But it鈥檚 hard to see Premier Christy Clark going that route. And yet Alberta, with its staunchly conservative tradition and leanings toward free enterprise, is moving in this direction. Might Clark instead make the opposite choice, and divest control of public facilities to a private operator? Philosophically, that might be more comfortable, but would the voters stand for it?
The health minister has promised more consultations before any decisions are made. It will be interesting to see how he navigates these choppy waters.
