For-profit care of seniors proven to be inferior

Vancouver Coastal Health recently announced it will close two publicly owned and operated residential care facilities in Sechelt. The creation of 600 new beds will be contracted to private for-profit facilities.

The decision to go with private for-profit beds contradicts the scientific evidence about ownership and residential care quality.

We reviewed the link between ownership and care quality in a recently published study and concluded that contracting out care to private, for-profit facilities is likely to result in inferior quality of care compared to care delivered in public and non-profit facilities.

For-profit facilities have fewer nurses compared to non-profit and public facilities. A B.C. study found that publicly-owned and operated facilities provided 60 minutes more direct care per resident every day compared to for-profit facilities. Lower staffing levels are linked to higher staff turnover, and when staff is always changing it is difficult to form relationships with residents and families. Residents also report better health when they feel close to at least one staff member.

Research in both the U.S. and Canada reveals that residents of for-profit facilities are also more likely to get pressure ulcers (bed sores), and have higher rates of hospital admissions.

Moreover, the evidence suggests the greater the profit, the worse the outcomes. In one study, for example, for-profit facilities with the highest profit margin had significantly more deficiencies found during routine inspections than those in the next-highest profit group.

So what is behind this relation between profit and inferior care?

One explanation is that there is a trade-off between improving quality (for example by hiring more staff) and generating profit. In other words, where the pressure to make a profit is strong, quality may be sacrificed.

This does not mean that all for-profit facilities provide poor care. Indeed there are many “ingredients” beyond ownership that are also necessary for good care. However, the evidence show that as a group such facilities are less likely to perform as well as non-profit or public facilities.

Some provinces have contracted new residential care beds to for-profit facilities because of a reluctance to use public money (through borrowing) to build new facilities. However, the evidence on poorer quality in for-profit facilities including higher rates of hospital admissions, means there is a false economy to this decision. Other jurisdictions have found ways to raise capital through the sale of government savings bonds and/or supporting non-profits that have property assets, with the expertise needed to design and build a residential care facility.

Decision-makers have also argued that a strong regulatory system would address the problem of poor quality. There is no doubt that policies such as mandatory minimum staffing levels with adequate funding to support these minimums and good regulation are also important. However, the more that regulation is ramped up to deter poor care, the greater the diversion of resources away from direct care provision of residents.

How we take care of seniors at a time in their life when they are most vulnerable and need the greatest support is an important public policy challenge. It also is a clear statement about who we are as a society.

Vancouver Coastal Health intends to create a further 258 beds and has yet to announce its decision about these beds. An opportunity such as the one currently before our decision-makers to decide about future ownership of care delivery is rare and the result has lasting implications.

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This piece was originally published in the Vancouver Sun.

Topics: Health care, Privatization, P3s & public services, Seniors