Planned hospital merger could be big risk for Ross Memorial

On November 20, 1902, medical experts travelled by train to Lindsay to be part of the opening of the $80,000 Ross Memorial Hospital, named in honour of the benefactor James L. Ross’ parents. At the time it was one of the finest and best-equipped hospitals in Canada.

A local paper commented that the day was “a red letter day in the history of the County of Victoria.” Ross, a successful railway engineer and philanthropist, had lived briefly in Lindsay and covered the entire cost of the hospital’s construction on the condition that “the County maintain the facility as it would not only be a memorial to his parents, but also a gift to the community he had once called home.”

County of Victoria Warden John Austin, in his remarks at the opening proclaimed, “the spirit which dedicated this building as a memorial of the past, and a blessing for the future, will outlive even its solid walls.”

After generations of local citizens have been born and died in what is surely a cornerstone of our community the questions we must answer now are: “will the hospital outlive the proposed merger with the Peterborough Regional Health Centre (PRHC), and if it does, in what form will it survive?”

Those questions might seem alarmist or simply change-adverse — until one examines the overwhelming evidence of international, national and provincial data on hospital mergers that suggest this might not be a great idea.

The RMH and the PRHC announced their “integration discussions” by releasing a shared vision, a community engagement and communications plan and an overall integration work plan on April 24, 2018 after being mandated by the regional funding body — the Central East Local Health Integration Network (LHIN) — to ‘explore integration’ on March 28, 2018. But make no mistake — this is more than an exploration or the discussion of an idea: One of the strategic goals of the community engagement plan is to “build commitment to the new organization.” The very same document that plans for ‘town halls’ and surveys to get ‘stakeholder feedback’ also has the date for full integration: January 1, 2019. They are telling us, in advance of whatever “concerns” we might raise as a community, that this merger is a done deal.

Mergers Cost Money

Hospital mergers (or to use the more benign-sounding, consultant-speak of ‘integrations’) are not a new phenomenon in Ontario, in Canada or indeed much of the world. In fact, there have been so many hospital mergers that we can benefit from much research done on the topic. A study in the British Medical Journal states that the study of hospitals in many countries has shown that the best size for an acute care hospital is 200-400 beds and above that “management and administration costs tend to increase.” Another study in the same journal states that two years after mergers, the new institutions had not achieved the “predicted management cost savings.” But we needn’t go so far afield to look at the effects of hospital mergers.

Many of us are old enough to remember the rash of hospital mergers in Ontario in the 1990s, which were a response, we were told, to the challenging economic conditions of the time. Mergers were touted as a panacea to the woes of our health-care system. The end result was not so promising: A review by the auditor general of Ontario found that those mergers realized $800 million in savings and cost the healthcare system $3.9 billion. The Canadian Health Services Research Foundation (CHSRF) — now called the Canadian Foundation for Healthcare Improvement — has a stellar reputation for quality and impartiality. After reviewing the many academic studies regarding mergers, this is what they conclude: “The urge to merge is an astounding, run-away phenomenon given the weak research base to support it, and those who champion mergers should be called upon to prove their case.”

The Lindsay Advocate asked the CEOs of both the RMH (Dr. Bert Lauwers) and the PRHC (Dr. Peter McLaughlin) to ‘prove their case’ and the answers were long on generalities but rather short on specifics. To be clear, both hospitals are led by exceptional people with impressive records.

Dr. Bert Lauwers — who is highly regarded in our community — has had a distinguished career in medicine and hospital administration yet still provides clinical services at the Kawartha Family Health Team After-Hours Clinic. Not every community hospital has a CEO that can be involved in ground-level medicine.

As mentioned in the RMH-PRHC joint “Operational Plan” presented to the LHIN, and restated to the The Lindsay Advocate by Dr. McLaughlin, “it is important to note that under current legislation, all hospitals have a legal duty to explore opportunities for integration of the services they provide to patients.” So despite overwhelming research that mergers might actually cost money (thereby reducing the amount of money for actual healthcare) this is being proposed because it has to be proposed — and all rationalizations for it must be examined in that context.

The Ontario Health Coalition is a non-partisan network whose primary goal is ‘to protect and improve our public health care system.’ They have studied several hospital mergers and released detailed research reports on the results. As Executive Director Natalie Mehra told The Lindsay Advocate, “if there was any evidence that mergers were good for health care in Ontario we would support them because our mission is to be a watchdog for the Canadian Health Act. But even the most neutral sources say that mergers don’t save money.” Her analysis should give us some cause for concern, especially here in the City of Kawartha Lakes.

Smaller Hospitals Lose Services

Asked specifically about this merger, Mehra went on to explain how these hospital mergers tend to be implemented.

“…any services that are offered at both hospitals are considered duplication and something that is to be eliminated. Patients will have to travel, creating the opposite of a community hospital.” Asked specifically about services at the Ross, Mehra replied, “in our experience smaller hospitals lose services” in a merger. Mehra predicts that Lindsay “will lose surgeries, acute care and obstetrics, leaving only the services that are likely to be privatized in the future.

Alarmed by these predictions, The Lindsay Advocate presented them to both hospital CEOs. Dr. Lauwers (in an answer similar to his colleague) — responding to OHC’s experience that a smaller hospital always loses services in a merger —  writes, “The discussion of clinical services is out of scope for these integration discussions. That means no movement of services is being considered as part of this process.”

Part of this process? What processes are to follow? For the residents of the City of Kawartha Lakes, the devil may be in the lack of details.  So ignoring international, national and even provincial data, what has happened to hospitals closer to us that have underwent forced mergers?

The merger of Ajax/Pickering with Lakeridge saw Ajax’s non-acute care being moved to Bowmanville, meaning a long drive for affected family members. And that is an area that actually has some viable public transportation options unlike the City of Kawartha Lakes. After much community activism Ajax was able to maintain five major types of services — in a hospital with a catchment population twice the size of the RMH’s. Some figures demonstrate that it will take 62 years to pay off the cost of this merger.

The hospital mergers of the Durham West and Scarborough hospital systems should also raise red flags for citizens in Kawartha Lakes. The merger costs, according to the hospitals’ own figures, include $1.9 million for integrating the management team and $13 million to merge telecommunications, email and information technology, $1.1 million in legal and public relations costs and $2.5 million in costs to lay off staff and harmonize wages. Although mandated by the provincial funding authorities, the cost of these mergers are not covered by the province and must be absorbed by the hospitals themselves out of their operating budgets. The Scarborough Health Coalition and the OHC in their report on this merger noted that hospitals themselves, in a submission to the LHIN, stated, “there are minimal operating efficiencies that will result from integration.”

Both Doctors’ McLaughlin and Lauwers echoed the direction plan by stating that a merger would increase their ability to recruit staff and give the amalgamated hospital a bigger voice ‘at the table.’ On the recruitment issue, the OHC’s Mehra “questions what they were doing before.”

Beyond that there is a certain lack of logic to this process. The argument seems to be: “The LHIN and the law has mandated a merger; by merging we will be listened to more.” These arguments are also right from the merger playbook. A recent merger between two Muskoka hospitals was explained by MuskokaRegion.com this way: “The purpose of the merger was to gain a greater voice with the Ministry of Health and Long Term Care, the Ontario Hospital Association and the Ontario Association of Community Care Access Centres. Board members also hope the new association will be able to attract more physicians and personnel to the region, since this task was becoming a challenge.” This sounds very familiar.

Who Really Benefits in a Merger?

Given the sheer volume of negative or neutral data on hospital mergers, one might ask why our health care system is seemingly so addicted to them. A skeptic might point to the fact that research has shown that executive compensation after mergers increases far above the rate of inflation, while the current hospital funding formula funds increases below the rate of inflation. Or, that these mergers often require the services of consulting firms, themselves either staffed or owned by former hospital executives for this type of work.

Take the Durham merger for example: The OHC explains that those exorbitant merger costs “do not include the costs of the Minister’s appointed “facilitator,” a consultant with KPMG appointed in April to ease the passage of the merger, nor do the projected costs listed here include additional “transaction” (legal and PR costs) for the Central East L.H.I.N.”

Lost in all the false economies of hospital mergers and feel-good, unsubstantiated promises of “improved sustainability” and “an ability to expand programs and services for patients” is the elephant in the waiting room: hospital funding. In a comparison of hospital funding with national averages of 36 O.E.C.D. countries, only Mexico and Chile fund their hospitals at a lower rate per capita than Ontario.

Furthermore, a change in the hospital funding formula by the Wynne government further tips the scales towards the economic madness of mergers. In 2011, hospitals such as the RMH used to receive 98.5 per cent of their funding from the province. A new funding formula sees 70 per cent of the hospital being funded by a system that favours larger hospitals, with 40 per cent of funding coming from a health-based metric (which rewards hospitals for shorter hospital stays by patients, for example) and 30 per cent of the funding coming from a fee-for-service model, which rewards larger hospitals and punishes smaller community hospitals.

It would seem that people who want the City of Kawartha Lakes to have a full-service hospital now have their work cut out for them, but as Mehra reminds us “don’t accept this as a fait accompli. These are decisions that can be reversed or changed but to change them we [the citizens of Kawartha Lakes] must build a clear and vocal opposition.”

She continues, “a community hospital serving almost 100,000 people as does Ross Memorial, needs to have an emergency department, palliative care so people can die close to home, chronic care close to home for those with longer-term hospital care needs, acute care including surgeries and other procedures, diagnostics. In amalgamated hospitals these services are considered “duplications” and they are cut.

This causes hardship for people, particularly the elderly, who are forced to travel from town to town to access care. In any case, there is not the capacity in Peterborough to cut services in Kawartha Lakes and shunt patients to Peterborough. That hospital is already full. Both communities need more services not less. The amalgamation and the rationing of services that would inevitably follow would be harmful both for patients in Kawartha Lakes and for patients in Peterborough.”

Is this the change we want?

One hundred and sixteen years ago, members of our community articulated a vision. Change is clearly being planned for our community hospital. The question that remains is, as active and engaged citizens, do we want the change being thrust upon us? Or do we speak up, clearly and strongly, to refocus that vision back towards a true community hospital.

Have your say at a Public Meeting at the Ross Memorial’s cafeteria on Wed. Aug. 29 from 7-8 pm.