LHIN Legislation Will Likely Lead to Significant Restructuring of the Health Services Sector

by: Jo-Anne Pickel

The government passed Bill 36, the Local Health System Integration Act, 1005 on March 1, 2006. The legislation sets out the framework for the government’s restructuring of the delivery of health services in Ontario. It creates and continues Local Health Integration Networks (LHINs) and outlines the powers that these entities will exercise in relation to health care integrations. The statute also outlines the powers granted to the Minister of Health in respect of this restructuring. Both the LHINs and the Minister are vested with significant powers under the legislation. LHINs are granted the power and mandate to seek opportunities to transfer or merge services, to coordinate interactions and create partnerships (between not-for- profit or for-profit health service providers.) The Minister is granted extensive powers to order health service providers to amalgamate, transfer their operations to other entities, or even to cease operating or wind up their services altogether.

The legislation covers a wide range of health service providers including hospitals, certain psychiatric facilities, long term care facilities, community mental health and addiction agencies, community health service providers, community health centres, and other entities prescribed by regulation. Significantly, the legislation either expressly excludes or does not cover other key components of the health system such as doctors, independent health facilities, public health units, dentists, optometrists, labs and certain corporations of health professionals.

Bill 36 is a complex piece of legislation, the details of which the Ministry admits it has yet to fully work out. However, organizations representing front line health workers are concerned that, instead of strengthening the public health system and promoting non-profit health care, the legislation will set the stage for further privatization of the health care sector. This article reviews the main changes made to Bill 36 by the Standing Committee on Social Policy.

Impact on Publicly Funded Health Care and Privatization

While the Committee did strengthen the language in the preamble to affirm the government’s commitment to the principles found in the Canada Health Act, to the promotion of the delivery of public health services by not-for-profit organizations, and to continuous quality improvement in health service delivery, it rejected proposals that would have required the Minister and LHINs to taken into account these public interest principles in their decision-making under the Act.

In addition, the legislation continues to allow for the increased privatization of health care, for example through the use of competitive bidding processes. The statute continues to provide no safeguards to prevent LHINs from employing a procurement system based on a competitive bidding model such as the one currently used in the home care sector. The possibility that LHINs will use a competitive bidding process when making integration decisions has been of particular concern to front line health professionals who fear that the process will have a negative impact both on the quality of health care and on the practice environment for front line health professionals.

In addition, amendments to the legislation that appear to require that non-profit and for-profit organizations be treated equally under the legislation are seriously undercut by exceptions to the statute. Amendments were made to provide the Minister of Health with the power to order the closure or amalgamation of for-profit organizations, as well as not-for-profit organizations. However, many for-profit organization are excluded from the scope of the Act and a number of exceptions were introduced to specify that the Minister cannot order the closure or amalgamation of the majority of for-profit organizations covered by the Act. As a result, the Minister’s power to order closures and amalgamations applies largely to non-profit organizations.

The legislation also continues to provide Cabinet with the power to contract out certain non-clinical services from hospitals, although it now provides a deadline of April 1, 2007 for the Cabinet to exercise this power.

Participation of Community and Front Line Health Care Workers in LHIN Decision-Making

Unions and health care advocacy organizations were somewhat successful in securing amendments that flesh out the legislation’s vague requirement that LHINs “engage the community”, although the practical impact of these changes is far from clear. Bill 36 was amended to include a definition of “community” which includes patients and other individuals in a LHIN’s geographic area, health service providers, and employees in the local health system. The definition does not include unions or other professional associations. The legislation also now sets out general methods by which LHINs may engage the community. These include holding community meetings or focus group meetings or establishing advisory committees. The bill was also amended to require that a LHIN engage certain Aboriginal and French language health planning entities for the geographic area in which it is located. Finally, the legislation retains the requirement that each LHIN establish a health professionals advisory committee.

While these amendments do flesh out the requirement that LHINs engage the community, the extent to which they enhance opportunities for democratic input from health service professionals will be limited due to a number of factors. First, the members of the health professionals advisory committee will be appointed by the LHIN itself. Also, the legislation does not explicitly set out the circumstances in which a LHIN must consult the health professionals advisory committee, nor does it clearly specify the parameters of the committees “advisory” role.

Notice of Decisions and Right to Make Submissions

Amendments to the LHIN legislation will provide members of the public with notice of LHIN integration decisions and 30 days in which to make written submissions regarding the proposed decision that must be considered by the LHIN prior to making its decision. These changes appear to be an improvement over the previous version of the Bill which provided only a right for health service providers who were parties to the decision to request a reconsideration of a decision once it was rendered. While the amendments providing for notice to the public and the opportunity to make submissions are welcome, the legislation provides no right for persons to seek a reconsideration or appeal a decision once an integration decision is rendered.

The legislation also provides for notice to the public and an opportunity to make submissions in circumstances where a LHIN reviews proposed voluntary integrations between a health service provider and another entity. However, because the legislation does not require LHIN oversight of all voluntary integrations, not all of these integrations will be subject to the public notice and submissions requirement.

Public Accountability and Transparency

The Committee did make a number of amendments that will improve the public accountability and transparency of decision-making under the Act; however the practical effect of these amendments remains to be seen.

LHIN Board Meetings

The legislation retains the direction that, in principle, meetings of LHIN boards of directors and committees are to be open to the public. In addition, the Bill was amended to specify the circumstances in which a LHIN may exclude the public from any part of its meetings. The previous version of the Bill left these circumstances to be decided upon in a Regulation passed by Cabinet.

The list of circumstances in which the public may be excluded tracks the circumstances set out in the government’s proposed Transparency in Public Matters Act which will apply to certain public bodies including hospital boards of directors. The specification of the circumstances in which the public may be excluded from meetings appears to make LHIN boards more accountable to the public and to make their decisions more transparent. However, the list of circumstances in which the public may be excluded is long and each item is framed broadly enough to cover a wide range of circumstances. Significantly, the list of circumstances includes when meetings will involve a discussion of matters that the Cabinet prescribes by Regulation, thereby preserving Cabinet’s discretion to add to the already long list of circumstances listed in the legislation. On the positive side, the legislation now requires that, before excluding the public from a meeting, a LHIN must hold a public vote on a motion clearly describing the nature of the matter to be considered at the general reasons why the public is being excluded.

Of continued concern is that LHIN Boards of Directors will be appointed by the Minister rather than elected by, and answerable to, the community.

Information to Public

Amendments to the Bill will improve access to the public to certain documents relating to integrations under the Act. However, as with other changes to the Bill, the impact of the amendments in practice will remain to be seen. The Bill was amended to require the Minister or a LHIN to make available to the public copies of any service accountability agreements entered into between them and a health resource provider. The copies of the agreement are to be made available at the offices of the Ministry or LHIN, as the case may be. This is a welcome change, but it should be noted that the Minister and/or LHIN retains the discretion as to whether to make available to the public copies of compliance directives, notices or orders made under the Act.

The Bill was also amended to require that the Minister and each LHIN maintain and publish on their websites documents that the Act does require them to make public.

Review of Act

The Committee did accept an amendment that would require a comprehensive review of the Act to be launched between three and four years after it is passed. A government committee is required to make recommendations concerning amendments to the Act within a year of the commencement of the review.

Conclusion

Overall, although the Standing Committee on Social Policy did make small improvements to the LHIN legislation, the amendments fall short of the proposals advanced by organizations representing health care workers. Even once the legislation comes into force, many of the details regarding its operation in practice will remain to be fleshed out. What is certain is that the Act will have a profound impact on the way health care is delivered in the province and therefore also a significant effect on the work environment for front line health care professionals.