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Nancy Van Laeken is head of Providence Health Care's surgery department, seen here at St. Paul's hospital in Vancouver September 23, 2010.John Lehmann/The Globe and Mail

For 12 years, the mirrors in Debbie Wright's home have been covered up so that she doesn't have to confront the image of her disfigured chest, the legacy of two mastectomies.

She's 56 years old. She wants to wear T-shirts again. She's been waiting three years for a call from the doctor's office to set a date for breast reconstruction surgery, to restore what cancer took away from her. "The two scars I'm looking at are disgusting," she said.

Plastic surgeon Nancy Van Laeken, a specialist in breast reconstruction, hears similar stories of grief every day in her consultation room.

"If it was your mother, you'd be screaming," she said when asked about Ms. Wright's long wait. "I don't even see them for a consult because I don't know when I can schedule them."

When Health Minister Kevin Falcon unveiled the first contracts awarded to the province's health authorities for "patient-focused" funding this week, Dr. Van Laeken was standing at his side, applauding.

The new formula is expected to reduce waiting lists for in-demand surgeries and diagnostic tests by paying hospitals on the basis of how many of those procedures they complete.

Introducing pay-for-performance for hospital procedures is a Canadian prototype and Mr. Falcon is moving cautiously.

The $23-million he signed off on this week amounts to just one-half of 1 per cent of the money flowing to hospitals this year. But within two years, Mr. Falcon expects one-fifth of funding for surgeries and hospital tests to be paid this way - creating a new culture where doctors are rewarded for working more efficiently by getting access to bigger budgets.

Dr. Van Laeken, as chair of Providence Health Care's surgery department, has championed innovations to get more patients through surgery - and she believes the new funding structure will foster that culture of change.

Under the current block-funding model, patients are a liability when they are wheeled into the operating room.

With patient-focused funding, the more Ms. Wrights a hospital can serve, the more money they can earn. Because each procedure is paid at a set fee, the hospital only gets ahead if it can find a way to do the process more efficiently.

"What we end up doing with block funding is crisis management," Dr. Van Laeken said. "Nobody is taking accountability for where is the money going. It doesn't really matter if I save money by doing my surgeries faster." In fact, if her department can save money, it risks budget cuts.

By attaching funding to patients, Dr. Van Laeken and her colleagues are offered a carrot.

"If we operate more, we get more resources to do even a better job," she said. "It's the beginning of an opportunity to micromanage our own budget so we can control where the money should be spent."

Dr. Van Laeken oversaw reforms in her own department to improve efficiency by running two operating rooms, so that patients can have a mastectomy and breast reconstruction in the same day, while each specialist doctor can move back and forth between patients without wasting time.

Ms. Wright only moves up the list when more immediate cases are treated. "If we can do the ambulatory surgery, it's going to allow those inpatient days to be opened up for reconstructive surgery. Everybody in the system will benefit," Dr. Van Laeken said. The next phase of funding, she said, needs to target patients like Ms. Wright who have been relegated to what the system deems "elective" surgery.

Adrian Dix, the New Democratic Party health critic, is skeptical that a new system, with its own bureaucracy, will make things better. While some patients will benefit from shorter wait lists, others will be left behind, particularly in rural communities. The hospital in Kitimat, where Ms. Wright lives, can't compete with the large urban facilities that can create efficiency through specialization. So it may end up being starved of funds while the major hospitals reap the benefits.

"This measure provides the illusion of change without creating change," Mr. Dix said.

For Ms. Wright, though, it creates hope: She is now allowing herself to imagine the day when her reflection doesn't make her cringe. "I'm going to buy some new tops," she said. "I'm going to take the covers off the mirrors."

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