Two Montreal "Super-Hospitals" that we can't really afford:

It's like buying a Cadillac when you can't pay for groceries !

text presented to the media at a news conference by

The Coalition of Physicians for Social Justice, February 14, 2000

by James Farquhar MD

A shorter form of this article appeared in the editorial and comment pages of The Gazette, Feb. 15, 2000

The Superhospital idea: It's like a family that buys a Cadillac when it can't even pay for groceries.

The Quebec government's $2 billion plan to build two big new Montreal hospitals will leave no new money for these urgent basic needs:

• home care,
• institutions for old and sick people
• care in the community for mentally ill people who can no longer live in institutions
• an improved health-care network outside of hospital for all Quebecers.

Quebec Health Minister Pauline Marois has given her approval for two new "super-hospitals" to be built. ⁽¹⁾

One, called the McGill University Health Centre (MUHC), is planned to replace the downtown McGill anglophone hospitals at a cost of $1.2 billion.

The other, the Centre Hospitalier de l'Université de Montréal (CHUM), would replace Hôtel-Dieu, Notre-Dame, and St-Luc hospitals for $800 million. Extra costs⁽²⁾ would push the total above $2 billion for both projects together, to be spent from now till 2005.

Many doctors love the idea of the expensive new buildings, but no one has proven they are needed. Less expensive ideas to renovate the old buildings have been proposed, for less than $900 million.⁽³⁾ Outside Montreal, in all of North America, this kind of total hospital building replacement is unknown, precisely because it is so very expensive. The North American trend is to use "mergers", treating two or more hospital buildings as one entity. Any new money is used to re-arrange services comfortably in the existing buildings, improve equipment and hire more health care staff.⁽⁴⁾

The $2 billion for the super-hospitals does not go directly to pay for better health care, but just to construct new buildings where health care can take place - the same health care that is taking place now in the existing buildings. In fact, the new hospitals would have at least 700 fewer hospital beds than 1998. ⁽⁵⁾

The new "super-hospital" buildings are clearly not necessary or urgent needs. The present hospital buildings at McGill were given an "overall excellent report card" in 1997 by a Canadian hospital accreditation team doing a routine evaluation. The team did not complain about the age or the suitability of the buildings as hospitals. Similar visits have been done recently for the University of Montreal hospitals, with similar findings.

Hidden costs:

The Super-Hospitals can't work without more home care and chronic care elsewhere. Without these vital new resources, patients will just stay and stay in the Super-Hospitals because they have nowhere safe to go. Then emergency rooms will be very crowded, just like now, and it will be almost impossible to get into the Super-Hospitals to get care.

To allow for eliminating these 700 beds, we will need more home care, and more beds in "chronic care" institutions. This would cost between $35 million and $105 million per year, just for these downtown Montreal hospitals.⁽⁶⁾

Quebec has not even reported how much money is needed for good home-care and chronic care for the whole province, to allow for similar hospital bed cuts. My own estimate is between $245 million and $735 million per year, but it could be more than that.⁽⁷⁾

What will we pay per year for the Super-Hospitals? What do we pay for other health costs?

To put the Super-Hospital costs into context, consider these facts:

• Quebec will not pay the $2 billion in one chunk for the super-hospitals, but would pay it like a mortgage. Even at a favorable interest rate of 7.5 per cent, this would take almost 20 years to pay at $200 million a year - just for the buildings, not for any services or personnel in the buildings. Once we build the buildings, we are stuck with the cost!
• This expense comes at a time when Quebec's 135 hospitals are going into debt by $350 million per year, just to pay their employees and give the services already available.⁽⁸⁾ It is a commonplace observation that hospital staff everywhere are overworked and under-funded, after budget cuts in the last 7 years. Many Quebec cancer patients are sent for treatment in New York State because Quebec hospitals are not given enough budget money to provide these treatments.
• Quebec has just announced another $1.5 billion in capital spending, for repairs and renovations, including $270 million in new projects.⁽⁹⁾ This does not involve the super-hospitals. This figure is similar to capital spending for 1998-1999 for the Quebec health ministry.⁽¹⁰⁾ Each year, we pay more and more in the current budget, for "mortgage payments" for ordinary renovations and improvements. The Super-Hospital costs will be added on to all that expense!
• The Quebec Health Ministry is already staggering under two unexpected expenses for the current budget year:
• $750 million extra is needed to pay for salary increases recently negotiated with health employees such as nurses. ⁽¹¹⁾
• The Quebec government's drug-insurance plan has a $79 million deficit this year, and an expected deficit of $189 million next year. ⁽¹²⁾

When we look at the exact figures, we see the following:

• We can't really afford the two "super-hospital" buildings, since they are not really necessary for good health. The health budget is already in a permanent deficit state.
• Building the two "super-hospital" buildings, means a commitment to pay $200 million a year, in deficit spending, for 20 years - just to have new buildings for the same health services.
• It makes more sense to keep the old buildings, and add on a small or medium-sized new high-technology wing or pavilion to get the most important improvements the Super-Hospital says are necessary. Especially, we must add low-cost home care and chronic care -- outside the hospital budgets -- to serve everyone and all hospitals. This idea would cost no more than $165 million per year (including services) for the downtown Montreal area, instead of $200 million per year just to have new buildings before budgeting for services.

If we tie up this $200 million a year in paying for the new buildings, probably the health ministry will say we don't have enough money for new chronic-care institutions, for example nursing homes for old people, or hospitals for old and sick people.

Here is the Health Minister committing $200 million a year for buildings. But the health ministry does not have enough money to keep a 1997 commitment to keep spending the same amount on care for the mentally ill. The government has cut mental health spending by at least $5 million a year. For really good mental health care, about $50 million more per year would be needed, as has been given in Ontario in the last two years.

Federal government contributions: The federal government has made no commitment (financial or otherwise) to either of the two Montreal super-hospitals. Instead, the federal health minister, Allan Rock, has insisted that federal funding should go for home care.⁽¹³⁾ There are strong hints that Ottawa is ready to increase transfer payments to the provinces for health, but Premier Bouchard has told Ottawa not to meddle with how Quebec spends any such money.⁽¹⁴⁾ Ottawa has indicated that we should not expect any large transfer of money to the provinces for health in the next 5 years, since some of its surplus would be given up for tax reduction.

Federal funding was hoped-for, but not granted, for the McGill super-hospital project . As of December 1999, the Quebec government had pledged to give only $300 million of the expected $850 million cost. McGill hoped to get $200 million from Ottawa, from its medical research budget. However, it seems far-fetched that Ottawa would consider giving a large chunk of money to one hospital in Quebec to build a new building, from research money. Federal Health Minister Allan Rock announced Feb. 11, 2000, that Ottawa's research budget for all of Canada is $165 million this year. Since Quebec has about a quarter of Canada's population, we could expect at most $42 million for all of Quebec in research money. Even if Ottawa pledged to pay a mortgage payment of $20 million a year for 20 years for the McGill new building, there would be outrage among researchers everywhere that the money would go to a construction project, rather than real research, for such a long period.

We all need to ask ourselves, do we want to keep our precious research scientists in Quebec, with federal research money to pay their salaries? Or do we grab most of that research money to pay for a building -- one that is not even necessary?

Are super-hospitals "good for the economy"? Some people say that any building project is "good for the economy". However, this idea does not stand up to examination, especially if you look at the Olympic Stadium. When the stadium was being built from 1974 to 1976, for more than $1 billion, naturally the money went to architects, engineers, construction workers and contractors. These people spent that money between 1974 and 1977, and a lot of that money was spent outside Quebec, for example on holidays in Florida, or on goods not manufactured in Quebec. Since 1977, the Quebec population has been paying the "mortgage payments" on the stadium, for a total of between $2.5 and $3 billion.⁽¹⁵⁾ So the stadium was good for the economy of a few people in 1975 to 1977, but it has been a horrible drain on taxpayers since then. No one would suggest that the Olympic Stadium is good for the economy this year or even in 1980, a few years after it was built.

However, a program of home-care and chronic care would definitely be good for the economy every year, for many years into the future. The main costs of the program would be salaries of people giving the care. These people are likely to be toward the lower end of the salary scale. They would probably spend most of their money in Quebec, year by year. Every year taxpayers would have to pay for the program, but every year the money would go back into the economy. Many people who would be hired, might otherwise be on unemployment or welfare. This is a much more sensible way to spend money than on big new buildings that give work for only 2 or 3 years.

We definitely need more home-care and chronic care. The population is aging. There will be twice as many people over 65 in the year 2030 compared to this year.⁽¹⁶⁾ As the "baby-boomers" get older, even in this decade we are facing the job of caring for our aging parents. In the next five and 10 years, we will be asking for more places in old age homes, chronic-care hospitals (to care for frail elderly or sick persons, people who have had major strokes, and so on). Since hospitals have reduced their bed numbers, we will be forced to care for our elder family members at home. We will ask for home care services - a lot of them. We will expect that these will be paid by the government, at least in part. Every year starting now, the demand for these home-care and chronic-care services will get bigger and bigger. We should plan for these services now, so that there doesn't have to be a crisis in a few years. If we fail to provide these services, we can expect horrifying crowding in emergency rooms for years to come.

We have to ask ourselves, is it more important to have a pleasant hospital building that is very expensive and not really needed, or is it more important to have good health and good care?

Hey, Madame Marois ! Surveys show that Quebecers don't want "super-hospitals" !

Quebecers can't afford to pay for these two super-hospitals. What's more, they don't even want them.

Less than 20 per cent of Quebecers approved of constructing the McGill super-hospital, according to two separate opinion surveys. (The Gazette, September and December, 1998). "A SOM poll for The Gazette [in December 1998] indicated that almost three out of four Quebecers oppose the [McGill super-hospital] plan, judging it too costly. An earlier poll, by CROP in September [1998], found only 11 per cent support it." -- from article titled "Superhospital land deal soon", by Jeff Heinrich, in The Gazette, Dec. 13, 1999, page A-3.

There has been no survey asking people to compare the CHUM super-hospital to other health care expenses being considered. I am very surprised that the government has not checked whether the public even wants these "super-hospitals."

It's not too late to cancel the super-hospital plans.

What we really need is a thorough, public review by the Quebec government of our total health-care needs over the next 10 or 20 years. Ontario spent three years doing this in the 1990s.

Let's think and discuss first -- and only then, announce the money for the resources.

All Quebec residents who care about their health, and the health of their loved ones, should be ready to tell the government how they feel about this.

-30-

NOTES

1. "Superhospital gets boost: [Quebec Health] Minister pledges Quebec's support for high-tech medical centre [for McGill]", The Gazette, Nov. 27, 1999, page A-3.

"Le nouveau CHUM: un choix qui est loin de faire l'unanimité", La Presse, Jan. 25, 2000, page A1.

2. For example, it will cost at least $20 million to decontaminate the soil on the MUHC site, an old railway yard where diesel oil has filtered deeply into the ground for many years. The CHUM site has exactly the same problem, since it is also on an old railway site. Also, a company whose buildings will be expropriated for the CHUM site, is insisting on compensation of more than $40 million for moving and inconvenience costs for its manufacturing operations. Because the CHUM site is next to a railway line, an urbanist has told the media that expensive steps will be needed to protect the building from train accidents and toxic chemicals carried by trains. Overall, these projects are planned for construction by 2005. Over the next few years, there are bound to be additional costs, including inflation, as we see for all public projects. Therefore the total cost will easily be more than $2 billion.

3. "Also rejected is an earlier plan, detailed in the fall of 1997and since modified, to renovate the CHUM hospitals - at half the $900 million projection for building the new one." - "Superhospital site set" (CHUM), Gazette, Jan 14, 2000, page 1.

4. This fact is supported by every pertinent article to be found in the hospital management literature, for example: "Major merger gives London Canada's second-largest teaching hospital," M. Oreilly, Canadian Medical.Association.Journal. May 1, 1996; 154(9), page 1401-2

5. "Le nouveau CHUM comptera environ 850 lits, quelque 400 de moins que le total des trois établissements actuels." - from the article: "Près de 900 m$ pour le nouvel hôpital du CHUM", Les Affaires, Feb.5, 2000. For McGill's MUHC project, it's been known since 1998 that the new "superhospital" would have about 800 beds, compared to more than 1,100 beds in the MUHC hospitals recently. The total bed reduction is at least 700 beds for both projects together.

6. Neither the government nor the hospitals have given an estimate of these costs. However, they can be estimated given these facts:

• "Chronic care" beds, in a general hospital or a chronic-care hospital, cost between $50,000 and $75,000 per year (for someone old or sick, unable to function in the community, on a long-term basis). Most of this cost is for skilled personnel such as nurses.
• "Acute care" beds in general hospitals are said to cost around $150,000 per year in Montreal. The costs include all overhead, including nursing and other personnel, and the costs of tests and procedures, not including payments made to doctors.
• Economic studies indicate that transferring hospital-bed costs to home-care costs, may save up to two-thirds of hospital costs, but may also be almost expensive as hospital-bed costs, depending on the scope and intensity of the home-care. For references, see the article "Economic evaluation of hospital at home versus hospital care: cost minimisation analysis of data from randomized controlled trial," J.Jones and colleagues, British Medical Journal, Dec. 11, 1999 319(7224):1547-50.
• Therefore the budget for caring for patients pushed out of the super-hospitals, into home-care and chronic care, is between 33 and 100 per cent of the budget previously allocated for the beds being eliminated.

Thus the budget would be based on the money previously spent for 700 beds, at $150,000 a year, or $105 million per year. The new figure, for home-care and chronic-care, to care for these same patients, will be between $35 million and $105 million a year. This logic is valid whether we are talking about chronic patients, or beds for non-chronic patients who will have a reduced stay at hospital after an illness or surgical operation because of newer routines and procedures. Incidentally, these newer routines and procedures to reduce hospital stay, can be applied in the old hospital buildings; we do not need a new super-hospital building to achieve these savings !

7. In the past week, both the Quebec health ministry (communications department) and the Association des Hôpitaux du Québec, told me that there was no complete or official report about estimates for the cost of home care. The Health Minister has announced a $2 billion plan for new hospital buildings, without accounting for the needs for home care ! I don't think this is a valid process.

To make an estimate of home-care and chronic-care needs for all of Quebec, it would be preferable to have a study by the government or the AHQ. I estimated that the two "superhospitals" would serve a total population of about 1 million people, for their general hospital needs. The population of Quebec is about 7 million. Therefore an "order-of-magnitude" approximation of home-care and chronic-care new costs in the next 5 years, will be 7 times the estimated cost for these resources for the super-hospitals.

I have calculated this as $245 million to $735 million per year.

(This figure is the Superhospital total of $35 to $105 million, times 7).

8. "Quebec's 135 hospitals are expected to be in the red by $350 million next year [in 1999-2000] despite the government wiping out their deficits this fiscal year." - from Health warning over hospitals deficit, The Gazette, Nov. 16, 1999, page A-3.

9. "Health care gets $1.5-billion infusion", The Gazette, Feb. 1, 2000, page A-5

10. From documents on the Quebec Health Ministry web-site, www.msss.gouv.qc.ca.

11. From "Une 'douleureuse' de 650 millions à Québec", Denis Lessard, La Presse, 26 jan. 2000, p. A1.

12. "Poor planning hits again", editorial in The Gazette, Feb. 4, 2000, page B-2

13. "Give us health funds, not advice: Bouchard", The Gazette, Feb. 2, 2000, page A-9

14.

15. "La dette olympique en route vers son troisième milliard", Gilles Normand, La Presse, Feb. 7, 1996, page A1.

16. "Work till age 67? Retire that idea", The Gazette, Jan. 6, 2000, page A-1