P3 information scheme hits hospital hard

Patients and staff at Vancouver General Hospital fear they’ll pay the price for a P3 patient information system that has gone badly wrong.

The deal, struck with BC Tel (now Telus) and US software company Phamis, was supposed to develop a fully electronic patient record system that BC Tel could then market to other health care facilities. With the government unwilling to finance the project, and the companies unable to finance the project themselves, the Royal Bank stepped in with a $50 million loan. In return, the hospital was to pay an undisclosed service fee to BC Tel and repay the bank over a 10-year period.

The deal, signed in 1996, promised the system would be up and running in two years and would save the hospital $15 million per year. The savings were based on cutting 600 full-time positions. The reality is quite different.

While some of the system is running, it is far behind schedule and plagued with problems.

An independent review, by accounting firm PricewaterhouseCoopers, concludes that projected savings of $82 million are well off the mark and that the hospital actually faces a shortfall of $72 million over the next 10 years.

The investigation, ordered by the province’s health minister, found that original savings targets were "overly aggressive" from the start. BC Tel admitted it took on the project without the necessary expertise to carry it out. And the hospital entered into the scheme without a proper plan. The expected labour cost savings were unrealistic and have not been achieved in other facilities using the same software.

"We’re worried that money earmarked for community health services now has to go to pay off this debt," says Leo Bibo, a member of CUPE’s Hospital Employees’ Union and an electrician at the hospital.

"If they cut back on something like cleaning, people may have to put up with alternate days of cleaning. Cuts would mean we won’t have the ability to clean to the standards of a good hotel, let alone a hospital," he says.

"Yet we have a whole wing of the hospital that’s been taken over by BC Tel consultants. We don’t know how much that’s costing, because apparently that’s a business secret."

The hospital has come up with a financial restructuring plan to handle the debt, but staff remain concerned the plan includes staff and service cuts for the sake of debt repayment. HEU is pressing for the provincial government to help create a restructuring plan that will protect patient care and the staff who provide it. HEU is also calling for a moratorium on any further health care P3s and for public funding to develop an information system that works.