Last week, the Alberta government released their latest provincial budget. In fact, it’s likely their last one before the next election.
Today, I thought I’d touch on how it’ll impact health care in the province.
According to the budget, the UCP government plans to spend $22.018 billion on health operating expenses. Last year, they spent $21.503 billion. This is an increase of $515 million, 0r 2.4%.
That seems pretty good, right?
Well, there’s something you should know. Last year, the Consumer Price Index in Alberta increased by 3.2% in 2021. That means that the increases to operating expense spending won’t even be enough to cover the bump in inflation.
Not only that, but Alberta’s population increased by 0.9% between the fourth quarter of 2020 and the fourth quarter of 2021.
So, basically, the amount we’re increasing health spending by this year—at least as far as operating expenses go—won’t be enough to cover the increased demand on services in addition to the increased costs.
While we’re here, let’s look at how spending will change over the next year for various healthcare areas.
|Physician comp & dev||$5.386 B||$5.351 B||-$35 M||-0.65%|
|Drugs & supp benefits||$1.923 B||$2.033 B||$110 M||5.72%|
|Pop. & pub. health||$0.591 B||$0.661 B||$70 M||11.84%|
|Acute care||$3.852 B||$3.881 B||$29 M||0.75%|
|Continuing care||$1.207 B||$1.223 B||$16 M||1.33%|
|EMS||$0.513 B||$0.587 B||$74 M||14.42%|
|Community care||$1.597 B||$1.719 B||$122 M||7.64%|
|Home care||$0.669 B||$0.75 B||$81 M||12.11%|
|Diagn., therap., other||$2.441 B||$2.457 B||$16 M||0.66%|
Here we see a wide variety of change in funding, ranging from a loss of $35 million for physician compensation and development to a gain of $122 million for community care.
As relative increases, the spread is from -0.65% for physician compensation and development to 14.42% for emergency medical services. That’s an average increase of 5.98%.
This doesn’t include all health spending, however. There is administration, support services, IT, research and education, and investments in cancer research and prevention. But the table above is for spending related to direct patient care.
One final thing.
I decided to compare the 4 years of the UCP’s first term against the NDP’s first 4-year term, and I found something interesting.
|1st year||4th year||Diff.||% diff.|
The UCP has increased total spending on health operating expenses by roughly $1 billion less than what the NDP did during their administration. Not only that, but the UCP increased their spending, on a percentage basis, at about half of what the NDP did (7.88% vs. 14.65%).
Had the UCP increased health spending over the last 4 years at the same rate as the NDP, Alberta would be spending $23.399 billion, instead of $22.018 billion.
One thing that the UCP has consistently claimed since taking office is that Alberta spends more per capita on health than other provinces (specifically, BC, Ontario, and Québec). And they’ve used that gap to justify their reduced health spending.
But that figure leaves out two key facts.
First, it’s more expensive to live in Alberta. Here, take a look at the consumer price index for all the provinces over the last 5 years.
As you can see, Alberta tops the list in every year. That means, overall, things cost more here. The CPI includes everything from shelter and food to transportation and clothing.
Second, wages are higher in Alberta. Take a look at average weekly earnings for all the provinces in every December of the last 5 years.
|Dec 2017||Dec 2018||Dec 2019||Dec 2020||Dec 2021|
Once again, Alberta is the highest. People are paid more in Alberta.
So if things cost more in Alberta and wages are higher in Alberta, then it makes sense that we would have to pay more for the same services than other provinces pay for.
Hospitals will have to pay shipping companies more to delivery the new equipment they purchased. Doctors will need to pay the janitorial company more that cleans their clinic. And if a plumber or a web designer is going to make more in Alberta, then it makes sense that a nurse or a radiologist will, too.
If you insist on paying health care workers less than what is made in other provinces, even though it costs more to live here and the private sector makes more here than in those other provinces, then ultimately, you’ll end up with worse health care delivery.