​Looking Under the Hood of Health Care Spending

This is the undertaking of the current government as described in the article by Barbara Simpson and published in the TJ on April 23, 2025.   The phrase takes its roots from the Budget Speech of the Minister of Finance as he delivered this government’s first budget in the Legislature in March of this year.

In that speech, and in subsequent discussion in the legislature, the Minister was pressed on government’s platform commitment to balance the budget while projecting a serious deficit in their first year in power.  As to the huge health file, which constitutes nearly half of government expenditures, he stated that government will “do business differently”.  His speech had a whole section on the topic of Transformational Change.

To advocates for the health and long-term care file, the use of that language was music to our ears.  For many years, we have been trying to push government to acknowledge the need for transformation, not just the simple promises of change that have been part of the governmental and bureaucratic language for too long.  As McKenna found in the 1990’s, deep change requires Transformation, changing the way business is done.  Changing the way business is done involves, at a minimum, laying all the cards on the table, not just those cards that are safe and convenient.

Transformation is not for the faint of heart; those who do not have either the willingness or the courage to engage, with the serious risks that are involved, should exit stage left right away.
“Looking under the hood” is a phrase used often by those who create and direct serious transformation.  In health care, the early 1990’s was the last time we saw serious transformation in New Brunswick.    Actually, New Brunswick and Saskatchewan were the leaders and every other province has followed our example.  But not until these two provinces paved the way and absorbed some hits in order to get the tough issues of transformation kick-started!

I remember giving presentations in Ontario and Nova Scotia on several occasions in 1994 and 1995, describing what had been achieved with re-structuring in New Brunswick.  Audiences saw the presentation and often responded “that would never work here in my province”.  But it has! Each province has invented their own adaptations of the same public policy principles because they all were learning that health care services were, then, on a collision-course with survival.

The 1990’s ushered in a new way of thinking about hospital structures and health care generally.  It was happening at the same time that the auto industry, led by huge companies such as Toyota, Nissan and others, was going through serious overhaul of their business and production models.  During those years we heard things like just-in-time inventory, Total Quality Management; Quality Circles, Lean Six Sigma.
Leadership training was taking off like a rocket as managers began to recognize the need for new skills in order to survive what they were seeing unfold before them. 

At that time some consulting firms observed the reformation that was unfolding before them and there was a great push to fast-track IT systems; better information, better management!  Simultaneously, there was a lot of focus in some places on the basics of the effectiveness of management structures.  One consultant that presented in Fredericton displayed some work they had done with “time and motion studies” that gave some insight into the real work activities of employees on the job.  The calculation of hours per shift invested in activities that were not directed to patient care provided sober thoughts for pondering!

In the history of health care, hospital organizational structures have never been great bastions of accountability, excellence or clarity.  One of the reasons that Peter Drucker, one of the most quoted management authors, describes healthcare as the most complex sector of our economy is that hospitals, and most health care organizations, operate with dual and triple accountability chains.  In conventional business arrangements, the owners set the vision, establish the goals, decide what the organization will achieve, then hire the engineers and all the other staff they require to get their business done.  Accountability is clear and everyone knows who their boss is and who the ultimate boss is.  That’s how business works and if it doesn’t, banks call you in!

In health care, not so much.  Hospitals and clinics mostly are successful in recruiting some of society’s great professionals but normally the organizational structures have a certain level of vagueness that causes businessmen to choke and gasp! 

When you are serious about “looking under the hood” you need to be prepared to find some things that work really well.  In New Brunswick, that would be the Extramural Program, the New Brunswick Heart Centre, and lots of other clinical services that do superb work.  You would also find Ambulance NB with the exception of some response issues in rural areas that seem to be problematic. 

But if you are serious, and governments in the past have “promised reform”, then you have to be prepared to ask some difficult questions, some that might be delicate, some controversial, others being questions that either government, its unions and its professional groups may not wish to be asked.  Looking under the hood, if taken seriously, means that you are ready to face issues and deal with them.  Short-term pain as the price of getting systems realigned and programs re-focused.

For instance, why is staff absenteeism so much higher in the publicly-funded system than in the private sector?  Why, with overcrowded Emergency Departments common in the early 1990’s, has there not been serious reform and restructuring that would enable optimum efficiency and great public service?  While we seem to have some great clinical staff, there can be no justification for the brutal wait times and over-crowded emergency departments.  Why are we still aghast 35 years later?  What is the role of the health authority governing boards in selecting CEOs?  In managing their performance?  In managing their own performance?  Is there any serious governance self-assessment?

Who sets performance targets for the health authorities and on what basis?  Who assesses success of meeting performance targets?  What happens if performance targets are not met?
Why are ultrasound procedures done only in hospital?

There are hundreds of great people who have serious managerial and leadership roles in the health authorities, long-term care, emergency services.  The practice of any of the clinical professions requires that practitioners achieve mandated and regulated certification and licensing.  How many of the hundreds of people in management and leadership have had job-specific training in health care management and leadership?  What percentage of total would that be?

What are the real issues that contribute to great workplace culture, how are they identified, by whom and by what means?

Prominent author, Jim Collins, in Great by Choice, observes that “we cannot predict the future but we can create it.”  That is the mentality that must underscore what government chooses to do with Health and Long-Term Care; we had the opportunity in 1992 and got it started; now we need to get back to the tough business of building on what was started.

Leadership guru John Maxwell often says: “if you keep on doing what you’ve always done, you’ll keep on getting what you always got.”  That’s us!

Ken McGeorge,BS,DHA,CHE is a retired career health care CEO, part time consultant, and columnist with Brunswick News; he is the author of Health Care Reform in New Brunswick and may be reached at [email protected] or www.kenmcgeorge.com