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Alberta is considering significant cuts to its health-care authority that could include privatizing a range of services, including some surgeries, as the government looks to keep its overall health spending flat and balance the provincial budget within two years.

A review of the Alberta Health Service, the authority that operates most of the provincial health system, found the province could save almost $2-billion annually by reducing benefits for nurses, cutting the pay of some doctors, and outsourcing more health and support services to the private sector.

Health Minister Tyler Shandro said he accepted most of the recommendations. He said any savings would be reinvested into the health sector and ruled out the closing of rural and underused hospitals after the report’s release on Monday morning. However, he said the government will look at the proposal to allow private companies to perform more routine surgeries and provide care for seniors. Public health care would continue to pay the cost of services from for-profit providers.

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Alberta Health Minister Tyler Shandro is sworn into office in Edmonton on April 30, 2019.The Canadian Press

Alberta Premier Jason Kenney has said there will be no sharp cuts to health care as his government looks to balance the budget by 2022, but the United Conservatives need to find ways to reduce the significant annual increases in health spending over the past decades. More than 43 per cent of Alberta’s budget now is allocated to health, with the AHS alone receiving $15.4-billion this year.

The review’s recommendations would make Alberta a leader in using the private sector to deliver health care, according to Friends of Medicare, an advocacy group.

But they could also exacerbate the province’s already fraught relationship with its unions.

“The scale of potential savings shows it’s realistic to do what we promised Albertans. To hold spending steady, without cuts, and to fund more patient care with internal savings," Mr. Shandro told reporters in Calgary. “… Every dollar we save will help increase access and meet the needs of our aging population.”

The Health Minister said he doesn’t expect the province to see the full $2-billion in possible cuts highlighted by the report, with many of the proposed savings requiring significant initial investments or years of changes to start seeing any benefit.

Sandra Azocar, the executive director of Friends of Medicare, said the report’s call for privatization would turn patients and seniors into commodities. “We wouldn’t be the only ones looking at privatization, but this would make us leaders in it, which is not a place Albertans want to be. We hear from Albertans that they can’t afford private health care,” she said.

The government has allocated almost no increases to the health budget of about $20.6-billion over the next three years. Only $62-million more in health spending is expected by the 2022-23 fiscal year. The province’s population is growing and aging quickly, meaning there will be fewer health dollars for each Albertan in the coming years.

The province is also facing pressure from unions who have seen few pay increases in recent years. On Friday, a number of health-care and public-sector workers were awarded a 1-per-cent pay increase by an arbitrator. Alberta’s Finance Minister has warned of the “potential for adjustment to work force levels” because of the pay increases.

The report, written by Ernst & Young, recommended that the government cut benefits for part-time nurses and reopen collective agreements to reduce the costs of nurses and doctors. Radiologists were a main target of the report, which found the average radiologist in Alberta billed the province $1.4-million, compared with the average of $872,000 in Ontario.

The Alberta Union of Provincial Employees, which represents nearly 45,000 health-care workers, said it won’t support the report’s call to increase privatization.

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