Hiding the Details on Health Spending

July 7, 2005

Corrections and Questions on Health Spending

Wednesday's article titled "Hiding the Details on Health Spending" produced responses from no less than three communications staff, one Ministry of Health and two health authorities, who pointed me to the addresses (URLs) for financial information, including lists of suppliers as required by the Financial Information Act, for the Northern Health Authority, the Vancouver Coastal Health Authority and the Fraser Valley Health Authority. I am grateful for their corrections and confess that it is embarrassing not to have found the pages when I did my original search. A correction was promptly posted to StrategicThoughts. It would be great if an equally rapid response was made to the suggestion that government should provide more information on how health dollars are spent by function or program. That is the central point of the article which focused on a "project" by the Public Sector Accounting Board of the Canadian Institute of Chartered Accountants which is looking at the need for detailed disclosures to provide useful information regarding health and education.

My quest for information on the health authority websites began with a search to determine the amount the authorities are spending on mental health. Prior to 2001 mental health was a separate line item in the budget for the Ministry of Health; since the 2002-03 budget, mental health has been included in the aggregate budgets for the health authorities. While that number remains illusive, the Vancouver Coastal Health Authority's website contains a document which promises more information. Section 5.2 of the Authority's "Service Redesign Plan" states that the following plans will be prepared by the times indicated:

Mental Health & Addictions Housing Plan - Summer 2004
Mental Health & Addictions Addictions Plan - Summer 2004
Mental Health & Addictions Child & Youth Plan - Summer 2004
Mental Health & Addictions Primary Care Plan - Fall 2004
Mental Health & Addictions Services for Adults - Fall 2004
Mental Health & Addictions Capital Inventory - Fall 2004
Mental Health & Addictions Strategic Plan - Winter 2004

I have not been able to find those reports or plans on the Authority's website; since articles on StrategicThoughts are receiving attention from communications staff, their assistance has been requested in locating the missing plans. Fraser Valley mental hlth 2005--6

In April 2005 a "Mental Health & Addictions Strategic Plan" for the Fraser Health Authority was presented in a series of PowerPoint slides. In that form the Fraser Valley plan looks more like an outline but at least it mentions "strategic investments" including $2 million in fiscal 2005-06 for "youth addictions treatment", $1.2 million for housing redesign and $600,000 for building capacity in outpatient programming. That document doesn't appear to be available on the Fraser Health Authority website and it doesn't place the investments in the context of a budget for current programs. If the Vancouver Coastal Health Authority plans exist, it would be instructive to compare them with the plans from other authorities. It would also be useful if the public could follow the plans in the months ahead so as to determine whether the investments are really made, and what is achieved as a result. The health authorities and the Ministry of Health have an opportunity to share information on their websites with the public. Until that is done, information that comes my way via email, fax or traditional plain brown envelopes will be shared on StrategicThoughts.com.

July 6, 2005

Correction: I appreciate a note from the Director of Communications for the Northern Health Authority who pointed me to the URL for financial information for that Authority. It includes the supplier and salary information required by the Financial Information Act. A communications officer for the Coastal Health Authority pointed me to the supplier information for the Vancouver Coastal Health Authority and the to supplier information for the Fraser Health Authority.

Hiding the Details on Health Spending

"The Public Sector Accounting Board of the Canadian Institute of Chartered Accountants sets the accounting standards that the province must follow. In this regard, it has a project to develop segmented financial reporting that will provide information on the major components of government. This initiative is intended to address concerns that the government entity has become too large and may have lost some of its meaningfulness in terms of describing the government's major responsibilities - for example, health and education. British Columbia has always provided supplementary sector information and, as the new requirements are defined, we will ensure we fully comply."
Arn Van Iersel, Comptroller General, introduction to the 2005 Public Accounts

The Comptroller General's reference to "the government entity" becoming "too large" is his choice of words. The Public Sector Accounting Board described the reason for its project by saying that "concerns have been raised about the level of aggregation." The Board went on to say:

"Disclosures of condensed financial information relative to government organizations in the SUCH (school, universities, colleges and hospitals) sector are of particular concern. PSAB's associates have noted that if SUCH sector organizations are part of the government's summary financial statements, users will need additional detailed disclosures to provide useful information."

In BC health is the greatest offender when it comes to hiding information through aggregation, but education also deserves some attention since Van Iersel's letter suggested that everyone is not necessarily pleased with changes that had to be made in order to fully comply with Generally Accepted Accounting Principles (GAAP) so as to receive an unqualified opinion from the Auditor General. In particular, Van Iersel wrote:

"As the result of the province's full compliance with GAAP, British Columbia now leads the country in terms of the organizations it includes it its reporting entity. As stated in previous years, however, for universities, we will continue to monitor the practices of other senior governments to determine if they truly should be considered part of government in the long term."

To hear Gordon Campbell and some of his caucus brag about finally complying with GAAP, one might think that the previous government dragged its feet. The truth is that under the NDP BC led the way with accounting standards, as was recognized in 2001 by the Premier's "financial review panel", but there has been a long-standing disagreement on whether universities should be included in the government reporting entity. This year's note makes it clear that controversy is not resolved.

The Comptroller's reference to the accounts losing some of their meaningfulness with respect to health care is an enormous understatement. According to the chart on page 17 of the Public Accounts, health made up 38% of total government spending, yet nowhere in the Public Accounts can you find how much is spent on mental health, how much is spent on particular hospitals, how much is spent on drugs in hospitals, let alone how much a hip operation costs. The 342 page "Section D" to the Public Accounts contains a list of every supplier to government that received a payment of more than $25,000. When it comes to health care the Provincial Health Services Authority is listed on page 212 as receiving $1,012,441,392 of which $1,011,300,629 came from the Ministry of Health and the balance came from the Office of the Premier, the Ministry of Children and Family Development and the Ministry of Human Resources. On an expenditure of over $1 billion that is all the detail that is provided; the accounts trace the expenditure down to the last $92 but they don't reveal which suppliers received the money or how it was spent on a functional basis.

It is possible to go to each of the six health authorities and find a little more information since they are covered by the Financial Information Act which requires that they also make available a list of all suppliers that receive payments of more than $25,000. The health authorities make those reports available on their website.

Listing suppliers who receive over $25,000 in payments may help with some forms of public scrutiny on where tax dollars are going, but a functional breakdown is even more important. It is hard to believe that the Ministry of Health does not receive reports on what each health authority spends by area of spending such as mental health, public health, homecare and acute care. That information should be shared with the public in the most inexpensive and readily accessible form, the Internet. British Columbians shouldn't have to wait for the Public Sector Accounting Board of the Canadian Institute of Chartered Accountants to force the government to disclose how and where money for health care is being spent. There is one exception to hiding information through aggregation in health care. Section 25(1) of the Financial Administration Act requires that ministries report in a schedule to the Public Accounts when monies are received by the government in accordance with an Act, so Section C of the Public Accounts breaks out $4.3 million of health spending and lists by function how it was spent. For example, $100,000 on the "Youth Access to Tobacco Project" and $69,000 on "Appropriate Drug use in Hypertension". The exception proves the rule that government could provide more information on how health dollars are spent by function or program if it were truly "open and transparent".