PROVINCE OF BRITISH COLUMBIA REPORT of the Hospital Insurance Inquiry Board 1951-52 VICTORIA, B.C. Printed by Don McDiarmid, Printer to the Queen's Most Excellent Majesty 1952 TABLE OF CONTENTS Letter of Transmittal of Report Act Setting Up the Hospital Insurance Inquiry Board- Order in Council Naming Members of the Board Order in Council Fixing Allowances to Board Members Order in Council Designating Minister to Whom Reports Shall Be Made.. Page 5 7 9 10 11 Report Section 1.—Foreword 13 Section 2.—Matters of Policy Directly Affecting the Financing of the Service— Items 1 to 19, Inclusive, in Accordance with Detailed Index at Front of Section.. 17 Section 3.—Matters of Policy—General— Items 20 to 29, Inclusive, in Accordance with Detailed Index at Front of Section 35 Section 4.—B.C.H.I.S. Administration— Items 30 to 37, Inclusive, in Accordance with Detailed Index at Front of Section 45 Section 5.—Hospital Operation and Management and Hospital Construction and Extension— Items 38 to 51, Inclusive, in Accordance with Detailed Index at Front of Section 57 Tribute to Work of Secretary and Staff. 80 Letter of Transmittal—Signatures 81 Section 6.—Appendices— Item I.—Summary of Recommendations 82 Item 2.—Interim Recommendations Made by the Board- Nos. 1 and 2, Dated August 11th, 1951 No. 3a, Dated October 17th, 1951 No. 4a, Dated October 17th, 1951 No. 5, Dated September 25th, 195L.._. 89 89 90 92 No. 6, Dated September 25th, 1951... 93 No. 7, Dated October 17th, 1951 94 Order in Council Having Reference to Interim Recommendations Nos. 1, 2, and 7 •- 95 Item 3.—Other Documents Referred to in Report— (a) Estimated Financial Effect of the Recommendations of the Board i 96 (b) Excerpt from Report of Mr. Samuel Eckler, F.S.A 97 (c) Summary of Comparative Hospital Costs 102 (d) Summary of Comparative Hospital Staffs 103 Item 4.—Indices of— (a) Public Hearings Held by the Board 104 (b) Hearings Held by the Board Not Advertised as Public 104 (c) Hospitals Visited by the Board, etc 104 (d) Written Submissions to the Board 105 REPORT To the Honourable the Minister of Health and Welfare, Province of British Columbia. The Hospital Insurance Inquiry Board, appointed in accordance with the provisions of chapter 36, Statutes of British Columbia, 1951, to inquire into, investigate, survey, and to furnish advice with regard to the Hospital Insurance Service and all matters pertaining to hospital operation in the Province, and to make reports and recommendations thereon, begs to submit the following Report. 1951 Hospital Insurance Inquiry. Chap. 36 CHAPTER 36. An Act authorizing an Inquiry into the " Hospital Insurance Act " and its Administration. [Assented to 18th April, 1951.] Short title. Board constituted. Chairman of Board. Remuneration of Board members. Powers and duties of Board. WHEREAS it is in the public interest that an inquiry should be made into the provisions of the " Hospital Insurance Act" and the administration thereof: Therefore, His Majesty, by and with the advice and consent of the Legislative Assembly of the Province of British Columbia, enacts as follows:— 1. This Act may be cited as the "Hospital Insurance Act Inquiry Act." 2. For the purposes of this Act, there shall be constituted a Board of not more than twelve persons to be called the " Hospital Insurance Inquiry Board," the members of which shall be appointed by the Lieutenant-Governor in Council. 3. One of the members shall be appointed to be Chairman of the Board. 4. (1) The remuneration of the members of the Board shall be determined by the Lieutenant-Governor in Council. (2) If any person appointed a member of the Board is also a member of the Legislative Assembly, he shall not receive any remuneration, but it shall be lawful notwithstanding the provisions of the " Constitution Act " for such member to accept payment out of the public funds of such sum for travelling and living expenses as may be fixed by the Lieutenant- Governor in Council, and the acceptance of such sum shall not make such person ineligible as a member of the Legislative Assembly, and shall not disqualify him to sit and vote in the Legislative Assembly. 5. The powers, duties, and functions of the Board shall be as follows:— (a) Generally to inquire into and investigate the system of hospital insurance established by the said Act, and to make a study in 7 Chap. 36 Hospital Insurance Inquiry. 15 Geo. 6 collaboration with such persons as it may see fit as to what amendments may be necessary to the said Act: (b) To make a survey of the Hospital Insurance Service, and to furnish advice with regard to such Hospital Insurance Service: (c) To investigate the hospital-construction programme, the relations between the Hospital Insurance Service and the hospitals of the Province, the relations between the various professions and groups connected with the operation of hospitals in the Province, and all matters pertaining to hospital operation in the Province. other investigations. q xhe Board shall make such other investigations and conduct such other inquiries for the purposes of this Act in such manner as the Lieutenant-Governor in Council may require and direct. Reports and recommendations. 7. The reports and recommendations of the Board shall be made to such Minister as may be designated by the Lieutenant-Governor in Council before the first meeting of the Legislative Assembly held in the year 1952. Powers on investigation. 8. For the purpose of any inquiry held pursuant to the provisions of this Act, the Board shall in respect of the investigation have the like powers as are given to Commissioners appointed under the " Public Inquiries Act." Regulations. 9. For the purpose of carrying into effect the provisions of this Act according to their true intent, and to supply any deficiency therein, the Lieutenant-Governor in Council may make such regulations not inconsistent with the spirit of this Act as may be deemed necessary, advisable, or convenient. All regulations shall be published in the Gazette and shall have the same force and effect as if incorporated herein. Appointments. XO. Such officers, clerks, and employees as are required for the purposes of this Act may be appointed by the Board. costs and expenses. xx. The costs and expenses incurred in the administration of this Act shall, in the absence of any special appropriation of the Legislature available for that purpose, be paid out of the Consolidated Revenue Fund. COPY OF MINUTE APPROVED APRIL 24th, 1951 To His Honour the Lieutenant-Governor in Council: The undersigned has the honour to recommend that, pursuant to section 2 of the " Hospital Insurance Act Inquiry Act," chapter 36 of the Statutes of British Columbia, 1951, the following persons be appointed to constitute the " Hospital Insurance Inquiry Board":— Donald Cameron Brown, M.L.A., Vancouver. Walter Hendricks, M.L.A., Nelson. Arvid Waldemar Lundell, M.L.A., Revelstoke. Daniel John Proudfoot, M.L.A., Victoria. Sydney John Smith, M.L.A., Kamloops. Robert Cecil Steele, M.L.A., Vanderhoof. Herbert John Welch, M.L.A., Qualicum Beach. Harold Edward Winch, M.L.A., Vancouver. And that Sydney John Smith be appointed Chairman of the said Board. Dated this 24th day of April, a.d. 1951. A. D. TURNBULL, Minister of Health and Welfare. Approved this 25th day of April, a.d. 1951. BYRON I. JOHNSON, Presiding Member of the Executive Council. COPY OF MINUTE APPROVED JUNE 1st, 1951 To His Honour the Lieutenant-Governor in Council: The undersigned has the honour to recommend that-, under authority of section 4 (2) of the " Hospital Insurance Act Inquiry Act," chapter 36 of the Statutes of British Columbia, 1951, the scale of allowance for travelling and living expenses incurred by members of the Hospital Inquiry Board in the discharge of their duties be fixed as follows: A living allowance at the rate of twenty dollars ($20) per diem for each day necessarily engaged on the work of the Board, or while travelling on behalf of the Board, plus actual travelling expenses. And that such expenses be paid upon production of vouchers duly certified by the Chairman of the said Board and for which purpose an advance may be made to the Chairman. Dated this 1st day of June, a.d. 1951. A. D. TURNBULL, Minister of Health and Welfare. Approved this 1st day of June, a.d. 1951. BYRON I. JOHNSON, Presiding Member of the Executive Council. 10 COPY OF MINUTE APPROVED SEPTEMBER 28th, 1951 To His Honour the Lieutenant-Governor in Council: The undersigned has the honour to report that the Hospital Insurance Inquiry Board appointed pursuant to the " Hospital Insurance Act Inquiry Act" is required by the said Act to make its reports and recommendations to such Minister as may be designated by the Lieutenant-Governor in Council before the first meeting of the Legislative Assembly held in the year 1952: And to recommend that, pursuant to section 7 of the " Hospital Insurance Act Inquiry Act," being chapter 36 of the Statutes of 1951, the Minister of Health and Welfare is hereby designated as the Minister to whom the reports and recommendations of the Hospital Insurance Inquiry Board shall be made. Dated this 28th day of September, a.d. 1951. A. D. TURNBULL, Minister of Health and Welfare. Approved this 28th day of September, a.d. 1951. H. ANSCOMB, Presiding Member of the Executive Council. 11 Report of the Hospital Insurance Inquiry Board SECTION 1.—FOREWORD British Columbia Hospital Insurance Service had been in operation for less than two and one-half years when the Hospital Insurance Inquiry Board was set up. During those first few months of its existence B.C.H.I.S. had grown into a $22,000,000 a year project. It was big business from the start, and it was a new business, too. In only one other place in the world had the hospital insurance problem been approached on a broad scale, such as was attempted in British Columbia on January 1st, 1949. Two years before that date there was no similar scheme in existence anywhere. So there was no established precedent or pattern to follow. During 1949 and 1950 B.C.H.I.S. experienced many of the difficulties that were to be expected in a new undertaking of this nature. As a result, during the regular session of the Legislature in 1951 the Hospital Insurance Inquiry Board was appointed, and its terms of reference gave it broad powers to investigate, between sessions, every phase of the hospital insurance problem and bring in a report before the opening of the first regular session of the Legislature of 1952. Soon after organization of the Board, Mr. Maurice Hesford, F.C.A., who had had a wide experience in hospital accounting and auditing, was appointed Secretary of the Board. Offices were opened in Vancouver. Information bearing on the subject of our inquiry was sought from the Federal Department of Health and Welfare at Ottawa and many other sources throughout Canada and the United States. These included the Canadian headquarters of " Blue Cross," commercial insurance companies, some Provincial Departments of Health and Welfare, Medical Associations in Canada and the United States, including the Mayo Clinic at Rochester, Minn. The Board commenced its work within the Province by going to Victoria, where it spent a week at headquarters of B.C.H.I.S. in conference with the Administration and getting acquainted with the head-office routine. Information gathered from many sources brought the Board to the conclusion that the task involved a tremendous lot of detail that would require a very long time to complete if every phase of the hospital insurance problem was to be fully explored. It was, therefore, decided to seek the services of specialists in the fields of actuarial practice and business administration. After exhaustive inquiry and on the highest recommendations, we appointed Mr. Samuel Eckler, F.S.A., of the nationally known firm of Pipe & Eckler, of Toronto, to be our Actuarial Consultant. This was followed by the appointment of Messrs. Stevenson and Kellogg Limited as Management Engineer Consultants. This firm occupies a high place in that particular field in Canada and came to us very highly recommended by important business firms who had and are still employing them. Mr. Eckler immediately commenced a comprehensive study of B.C. Hospital Insurance problems from the standpoint of an insurance actuary and Messrs. Stevenson and Kellogg Limited started a complete survey at B.C.H.I.S. headquarters in Victoria. When the actuarial study and administration survey got under way, the Board held hearings throughout the whole Province, in order to get " on the ground " information on the experience of citizens, hospital boards, and other organizations with B.C.H.I.S., and also to hear suggestions from such persons and organizations. 13 FF 14 BRITISH COLUMBIA The itinerary commenced with a complete coverage of the Interior of the Province, which took the Board up the Coast through Prince Rupert and Prince George to the Peace River District and on to the Southern Okanagan and Kootenay areas. This trip took three weeks to complete. It was followed by a week devoted to hearings at points on Vancouver Island, and the Board then concluded its public hearings in the City of Vancouver, where it sat for eight days. Of the seventy-six British Columbia hospitals within the B.C.H.I.S., the Board or a section of the Board actually visited thirty-nine hospitals. In addition to these visits, the Board met with the Boards of fourteen other hospitals. We held public hearings at twenty-one points in the Province. A complete tabulation of all hearings will be found in an appendix to this Report. The public hearings were all adequately advertised, and the interest of citizens was reflected in attendance. It is impossible to estimate with accuracy how many people were represented by spokesmen, but it is safe to say that we heard representatives of a majority of the entire population of the Province. A list of the organizations submitting briefs and representations forms another appendix to this Report. Immediately following public hearings in British Columbia, the Board went to Regina in order to gather first-hand information on the Saskatchewan Hospital Services Plan, which had started exactly two years before the commencement of B.C.H.I.S. The officials of the S.H.S.P. were extremely courteous and helpful. Saskatchewan, like British Columbia, has followed the process of trial and error, and during the five years of their operations many changes have been made, based on experience. The basic difference in the organization of the two plans is found in the methods used for registration and collection of premiums. The Province of Saskatchewan is blanketed by an almost 100-per-cent organization of municipalities or local improvement districts, and registration and collection is handled almost entirely through the municipal organizations and a commission is paid to them. In British Columbia this plan could not be followed because of the fact that we have large areas of unorganized territory. Utilizing the municipalities for registrations and collections enables the Plan in Saskatchewan to be handled with a staff much smaller than has been necessary in B.C.H.I.S. To deal with a total registration of about 310,000 in Saskatchewan, of which 280,000 or 90 per cent pay in one annual payment, the staff numbers about 155 persons, but the total amount of commissions paid would equal the salaries of an additional seventy-five employees. In British Columbia there are over 445,000 registrations and the staff numbers in excess of 640. This phase of administration has been given special attention by our Business Management Consultants, and we are advised by them that implementation of our recommendations in this respect would result in a reduction of B.C.H.I.S. staff from over 600 to 223. The principal difference in the financing of the two plans is that the direct payment by registrants in Saskatchewan is by way of a " tax," which is less than the " premium " as paid directly by the people of British Columbia. It naturally follows that a greater portion of the cost of the hospital plan in Saskatchewan is met by indirect taxation, partially covered by one-third of a 3-per-cent sales tax. A survey of the benefits under the two plans shows that there are certain differences. For instance, Saskatchewan covers care of chronic patients, whereas the benefits to chronic patients in British Columbia are restricted. While new-comers to the Province of Saskatchewan wait six months to be eligible for benefits, there is a two months' waiting period for a new resident in British Columbia. Both plans pay the hospital bills of their citizens confined to hospitals outside their home Province for a like period of thirty days; the Saskatchewan plan paying for such a patient at the rate of $5 per day, whereas the B.C. rate is $6.50 per day. An investigation of hospital costs shows a major difference, largely reflected in total wages paid due to the fact that the general wage scale is higher in British Columbia than in Saskatchewan. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 15 By this time the Board had amassed a great deal of material which was set aside for study and consideration after the conclusion of public hearings. About the middle of October we proceeded to analyse and correlate subject-matter of the briefs and minutes of our hearings. It had become quite apparent that there were what might be described as acute ailments in B.C.H.I.S. We gave first consideration to those items that appeared to be the more urgent, and as we laboured on them and approached the dead-line date for completing our report, it became ever more apparent that the time available was not sufficient to carry out an over-all survey in the intensive manner it deserved. We received the report of Mr. Eckler in December, and early in January we were advised by Messrs. Stevenson and Kellogg Limited that their work on the administration survey at B.C.H.I.S. headquarters could not possibly be completed and available in time for us to use in a final report before the opening of the Legislature on February 19th. As a consequence, we have completed an interim report, containing the recommendations that we consider most essential to correct many flaws in the present service and make B.C.H.I.S. more satisfactory to every one concerned. Many of our recommendations may reflect criticism. If so, it interprets public opinion as we have found it. Our approach has, from the beginning, been based on the undisputed fact that there was a great deal of dissatisfaction with B.C.H.I.S. and that a year ago there were two alternatives before the Legislature: first, to abandon the scheme entirely and, second, to try to correct the faults so that the B.C.H.I.S. could render the great humanitarian service that it was intended to do. A great majority of our citizens have expressed the wish that the Hospital Service be made to work satisfactorily, and we believe if our recommendations are implemented, the results will go a long way toward reaching that objective. Many of our recommendations will save costs and increase income. Others will increase costs and decrease income. We have prepared a tabulation, which is included as an appendix to this Report, which shows as nearly as can be estimated the net effect of our recommendations on the finances of B.C.H.I.S. Many of the items contained in the tabulation can be positively confirmed, while in the case of other items it was quite impossible to arrive at exact figures but, in all such cases, we have made estimates based on thorough study of the facts related to the particular item, and we have aimed at a minimum estimate rather than an exaggerated one. The financial effect of the Board's recommendations if adopted is threefold: on (1) the citizens, (2) B.C.H.I.S., (3) the Government. The citizens of British Columbia will save about $2,000,000 per annum for co-insurance charges. Those in lower-income brackets will be relieved of the payment of premiums. B.C.H.I.S. will lose the co-insurance income and will bear the considerable cost of extended benefit periods for chronic cases. The Service, however, will save on the very substantial reduction in the cost of administration and will also be relieved of the loss on the cost of hospitalization of Social Welfare cases and Treaty Indians. The Service is now burdened with these costs which rightly belong to other departments of Government, and our recommendations would transfer these items from B.C.H.I.S. to the proper Government agency. In the case of Treaty Indians, nearly half a million dollars in hospitalization costs now borne by B.C.H.I.S. would be paid by the Federal Government. The B.C.H.I.S. will further gain $1,000,000 from increased per diem grants and an estimated $875,000 from increased premium collections, and they will lose $300,000 due to increased coverage of chronic cases. Other smaller items are clearly shown in the tabulations referred to and the total net gain to B.C.H.I.S. is $2,100,000. The effect on other departments of the Government or on the Consolidated Revenue Fund would be the cost of the following items:— FF 16 BRITISH COLUMBIA (1) Increased cost to cover full hospitalization costs of Social Welfare cases '. $1,000,000 (2) Increased per diem grants from 70 cents to $ 1 650,000 (3) Grants-in-aid to nursing-schools 130,000 (4) Premiums for low-income group 70,000 Making a total of $1,850,000 Giving due consideration to all these facts, we are satisfied, therefore, that the net result of the implementation of all our recommendations contained herein will be a net saving. We wish here to emphasize strongly that higher costs reflected in hospital budgets mean higher costs to B.C.H.I.S. which will have to be met, but this will occur because of the operation of ordinary economic and other conditions prevailing. There is, however, nothing included in the specific recommendations of this Board which will cause, of themselves alone, an increase in hospital costs unless it is shown in the tabulations referred to above. Many of the recommendations made by us will necessitate amendments in Acts or regulations, and we wish to point out that we have neither attempted ourselves nor have we sought technical advice on the details that would be involved in such amendments. Above all other things that the Board learned during its deliberations is that the people of British Columbia are intensely interested in the matter of hospital insurance. This interest is equalled by just as keen interest beyond the boundaries of the Province. One of the most interesting discoveries we made was that governments all over this continent—Provincial, State, and Federal—are presently engaged in trying to solve the problem created by the inability of the great masses to provide individually for the steadily increasing cost of hospital service. Millions of dollars have been spent and countless volumes of reports have been compiled on studies and surveys aimed at meeting this new and great social problem. The attention of the North American Continent is directed to the experiment that is going on in our Province under B.C.H.I.S., and British Columbia has the opportunity of giving a lead in the matter of hospital insurance. If we make reasonable progress in this new field of social service, we will give that lead and create for our Province an enviable record which will be a source of great pride to our people. In conclusion, the Board extends to all those individual citizens and organizations who assisted us in our task our grateful thanks. We were greatly inspired in our work by the fine spirit of co-operation displayed by those people referred to in the register of contributors accompanying this Report as an appendix. There are other persons—official and otherwise—who also gave us most valuable assistance but did not appear formally before us. In justice to all the people referred to in this connection, we refrain from singling out any for special mention. We are sure that all those who assisted us will share in the satisfaction which comes from a sincere effort to place the British Columbia Hospital Insurance Service on a more acceptable basis. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 17 SECTION 2.—MATTERS OF POLICY DIRECTLY AFFECTING THE FINANCING OF THE PLAN 1. Completion of Unfinished Survey and Study. 2. Continuation of Hospital Insurance Service (Basic Plan). 3. Premium Rates. 4. Co-insurance Charges. 5. Financing the Over-all Deficits of the Plan. 6. Municipal and Provincial per Diem Grants. 7. Future Increases of Premium Rates or Curtailment of Benefits. 8. Exemption of Groups on Religious Grounds. 9. Exemption of Groups: Canadian Pacific Medical Association of British Columbia and Telephone Employees' Medical Services Association of British Columbia. 10. Exemption from Premium Liability: Low-income Groups. 11. Exemption from Premium Liability: Student Nurses under 21. 12. Benefits: Out-of-Province Hospitalization. 13. Benefits: Out-patient Services. 14. Charges for Non-elective Use of Private and Semi-private Wards. 15. Premium Payable by Wives of Certain Veterans. 16. Hospitalization of Treaty Indians—Federal Government Responsibility. 17. Payment for Hospitalization of " Social Aid " Cases. 18. Educational Grants-in-Aid to Cost of Operation of Training- schools for Nurses. 19. Chronic Cases: Limit of B.C.H.I.S. Liability. No. 1.—COMPLETION OF UNFINISHED SURVEY AND STUDY According to the terms of reference covering the duties of the Hospital Insurance Inquiry Board, the Board is asked to file its report before the opening of the regular session of the Legislature in 1952. The Board has been advised by the Management Engineer Consultants, Messrs. Stevenson and Kellogg Limited, who were engaged by the Board to make a complete survey of the administration procedures at the headquarters of the Service, that the said survey (which has been proceeding for a considerable time) will not be completed in time for this Report. We have so far received from Messrs. Stevenson and Kellogg Limited only interim (or partial) reports. They estimate it will take some months yet to finish their work. The actuarial report of Mr. Samuel Eckler, of Toronto, who was appointed as Actuarial Consultant to the Board, was received in December, and should be considered in conjunction with the final report of Messrs. Stevenson and Kellogg Limited. It is, therefore, impossible for this Board to meet the requirements in its Commission, with respect to submitting a complete and final report. We have accordingly restricted our positive recommendations in this interim report to those matters coming within our study to date, in respect to which we feel immediate changes should and can be made for the betterment of B.C.H.I.S. and the satisfaction of the citizens of the Province. The Board therefore recommends that the time for submitting its final report be extended so that Messrs: Stevenson and Kellogg Limited may be enabled to complete their survey, after which the Board may proceed with a combined study of the two reports referred to, before filing the final report of this Hospital Insurance Inquiry Board with the Minister of Health and Welfare. FF 18 BRITISH COLUMBIA No. 2.—CONTINUATION OF HOSPITAL INSURANCE SERVICE (BASIC PLAN) The first basic question to command the attention of the Board was whether or not British Columbia Hospital Insurance Service should be continued. Much information was submitted by individuals and representatives of various organizations bearing on this basic question. The information secured from submissions, together with further facts gathered from a survey of the Hospital Insurance problem in other parts of Canada and the United States, all pointed to the necessity for some plan that will remove the responsibility for hospital costs from the individual budget to an organized insurance plan. As evidence that this necessity is agreed upon by all sections of the public, we would quote from the opening paragraph of the brief of the British Columbia Hospitals' Association, as follows:— The B.C. Hospitals' Association is now, and always has been, in favour of a compulsory province-wide Hospital Insurance Plan. And from the written submission of the College of Physicians and Surgeons of British Columbia:— There is agreement among doctors that insurance of all citizens against the possibility of a large hospital bill is in the best interests of the community. Since the inauguration of Hospital Insurance in British Columbia, we have witnessed numerous instances of the gratitude of patients who have received expensive hospital care. The bills for this hospital care would formerly have threatened their economic security. And further, from the brief of Mr. G. H. Jackson, secretary-treasurer of the Canadian Pacific Employees' Medical Association of British Columbia:— There would seem to be no doubt that hospital insurance must continue. It would be contrary to the wishes of the vast majority of the electorate and disastrous to the hospitals if it was abandoned. During recent years there have been sensational advances in all branches of medicine, surgery, drugs, hospital services, and every other phase of health correction and care. A member of the delegation which appeared before the Board, representing the British Columbia Hospitals' Association, made the statement that " The practice of medicine is fifty years behind the science of medicine "—a situation which is being rapidly changed. Not so long ago, many people considered a hospital was a cross between a boarding-house and a pest-house, and avoided entering a hospital because it was considered the place to take a patient only when hope was abandoned. At that time, people of means who could afford to have nursing service made available in their homes did so in preference to entering hospitals. A little later on (as a matter of fact, up to five or ten years ago) hospital service was deemed to consist of bed and board, with some nursing service, and many hospital insurance programmes were financed on a premium of about $1 per month per family. That margin of fifty years which had existed between the practice and science of medicine has been materially reduced during the last five to ten years. New techniques in the science of medicine, and particularly new developments in drugs, are responsible for a substantial increase in costs. Higher prices of drugs and medical services, combined with the general trend to higher levels in wages, salaries, and supplies of all kinds that contribute to hospital service, have brought us to the point where it is almost impossible for the average head of a family to budget for hospital costs from their own personal income. We learn on the authority of Herbert E. Klarman, Assistant Director of the Hospital Council of New York, writing in the Harvard Business Review for September, 1951, that the average cost per patient-day in general hospitals throughout the United States was, at that time, $15.65. This is a nation-wide average figure. Some localities run very much higher. A hospital authority on the Mayo staff at Rochester, Minn., recently stated that the per REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 19 patient-day cost, based on public-ward services, ran as high as $31 in some sections of the United States. Based on the foregoing facts, the general consensus of opinion, as expressed to the Board on behalf of the public of British Columbia, was almost unanimously in support of the continuance of a hospital insurance service. Spokesmen for many other bodies who play a part in hospital service, such as the College of Physicians and Surgeons, the British Columbia Registered Nurses' Association, and labour organizations, all stated very definitely that the organizations they represented had benefited from the inauguration of the Hospital Insurance Service and were hopeful that it could be put on a successful operating basis. The conclusions of our actuary, Mr. Samuel Eckler, were set out in Chapter VIII (entitled "Problems and Recommendations") of his report, a copy of which chapter is to be found as an appendix to this Report. In his submission, Mr. Eckler puts forward three possible approaches to the basic problem of the continuance of a compulsory hospital insurance plan, as he sees the matter. It will be noted that Approach No. 1 deals with the continuation of the present plan of a complete service benefit, with almost the entire population of the Province being covered. Approach No. 2 contemplates that the present plan shall be fundamentally altered by providing a cash per diem benefit rather than the over-all cost benefit now given. Approach No. 3 contemplates that the compulsory hospital insurance service should be terminated at some future date. We wish to note first that, in view of the almost 100-per-cent support and approval of compulsory hospital insurance which was placed before this Board, we are entirely unable to conclude that Approach No. 3 would be acceptable to the citizens of the Province or to the Legislature. In connection with Approaches Nos. 1 and 2, Mr. Eckler has endeavoured in his report, as quoted, to set out the advantages and disadvantages of each approach. It will be conceded that such a report is deserving of the fullest and most serious study, but this it cannot receive until the report of Messrs. Stevenson and Kellogg Limited has also been received. The Board therefore recommends that the B.C.H.I.S. shall continue to follow the present plan as referred to in Approach No. 1 of the Eckler Report, subject only to the recommendations contained in this Report of the Board, until the Board is in a position to file its final report. No. 3.—PREMIUM RATES In considering the matter of premium rates, the Board was faced with requests from many quarters for a reduction in the rates at present effective, whereas the facts obtained regarding hospital costs and also comparative premium rates in existence throughout Canada and the United States indicated that it would be inadvisable to recommend any premium reduction at this time. However, as other recommendations of the Board will reveal, it has reason to believe, even while giving due consideration to rising costs, that there is a distinct possibility of a fuller realization of the premium income due to the Service and a very substantial reduction in the administration costs of the Service. In anticipation that the recommendations of the Board concerning a new system of registration and premium payments will be accepted and implemented, the Board is of the opinion that a further period of time should elapse during which the results of the changed system are experienced and on record, every effort being made during that period to effect the expected savings and realize the highest aggregate income. The Board therefore recommends that at present there shall be no increase in the premium rates. FF 20 BRITISH COLUMBIA No. 4.—CO-INSURANCE CHARGES When the Board commenced its duties at the end of May, 1951, the matter of the co-insurance charge which had been introduced, effective April 1st, 1951, by Regulations Nos. 14-1 to 14-6, inclusive, had become the cause of the liveliest controversy and criticism. This criticism arose not only from the premium-paying public, but also from many of the hospital boards and administrators throughout the Province. In order to accurately determine the view-point of the hospitals in connection with the matter, and the results accruing to hospitals up to that time, the Board caused a questionnaire to be sent out to each hospital in the Province. The great majority of these were returned, and in most cases adequate information and opinions were given. It may be safely said that the majority of the hospitals were not in favour of co-insurance in the form and manner in which it had been introduced. Some of them said that increased premiums would have been preferable; some of them objected to the application of the charge to the first ten days' stay in hospital; some believed that the imposition of such a charge should be permissibly varied to meet the needs of any particular community or hospital; and various other suggestions for alternative plans were put forward. However, the larger number of hospitals, of those expressing an opinion, were in favour of the abandonment of the co-insurance imposition. As examples of the opinions expressed in written submissions received from hospitals, we quote as follows:— Cumberland General Hospital.—While co-insurance may have succeeded to some extent in reducing hospital demands, it is doubtful whether it actually represents a source of appreciable revenue, after allowing for increased paper work, cost of collection and bad debts. Further, the good-will of the premium-paying public towards the scheme is lessened by the fact that coinsurance charges occur at a time when they require services for which they have already paid by way of premiums. Grand Forks Community Hospital.—In theory co-insurance might have something to justify it, but in practice it is a monstrosity. It presupposes that doctors are so unprincipled that they will fill the hospitals with patients that do not require acute care. We have not found it so. Further co-insurance has greatly increased outstanding accounts receivable, and it has multiplied the work of the collector. It has meant more bookkeeping, more collecting, more outstanding accounts, more office staff, and more operating expenses in many ways. In actual practice, coinsurance appears to be a failure, and there is certainly every proof that it antagonizes our citizens. Providence Hospital, Fort St. John.—It would appear that a more acceptable method of having the patient share the costs of hospitalization would be to charge for at least some of the extras, and it is our opinion that such charges would cause less controversy. Most patients appear to regard co-insurance charges as a violation of their contract with the Hospital Insurance Service. The British Columbia Hospitals' Association, in effect, recommended the abandonment of the present system of co-insurance charges, by suggesting that " The Government permit the hospitals to decide what co-insurance, if any, is necessary to make up any deficiency in order to meet the cost of service in each hospital." Other organizations making written submissions to the Board are quoted as follows:— United Steel Workers of America, Trail.—We wish to go on record as being resolutely opposed to the co-insurance per diem payments feature of the Act. This feature is, in our opinion, wrong in principle. The yearly premiums are paid to ensure against hospital bills, but now when faced with the additional cost that is always involved by hospital treatment, additional levies are made by co-insurance. ...'■'! Vancouver, New Westminster and District Trades and Labour Council.—We submit that the present premium rate is far too high, and with the addition of co-insurance, the basically sound idea of hospital insurance becomes a nullity. In other words, the benefits of the scheme have become unattractive due to the price that must be paid for the benefits received. We submit that co-insurance be absolutely abolished. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 21 North Sidney Property Owners' Association.—We consider the government's plan for coinsurance a very objectionable feature as it places an unbearable burden on persons in the low- income brackets, and will prevent many of them from receiving necessary hospital care. The fear of being hospitalized and having to meet the co-insurance charges, in addition to the premiums, may prevent some of these people from even calling in a doctor till their case has developed to the stage where such action is unavoidable, and the result may well be the loss of one of the most important benefits expected from the Hospital Insurance Service—namely, the diagnoses of diseases in their early stages, when they may be successfully treated. Farmers' Institute, District "J," Peace River Block.—We are opposed to any policy of coinsurance. C.C.F., Peace River Executive.—Co-insurance added to the burden of those who have faithfully paid the premiums; and those persons in the low-income group, who have had to probably sacrifice in order to pay the premium now find themselves in the position of having to pay still more co-insurance, in the event of sickness. Co-insurance should be abolished. And from individuals the following are samples of written submissions received:— Mr. G. H. Jackson, Secretary, Canadian Pacific Employees' Medical Association of British Columbia.—Co-insurance was put into effect for the avowed intention of relieving the pressure on hospital bed-space, particularly for minor conditions and elective surgery. It is doubtful if it has achieved that object. What it has done is relieve the B.C.H.I.S. of a large portion of the cost of the initial ten days' treatment, arouse the public to a spirit of indignation, and place on the shoulders of hospital authorities the responsibility of collecting the charge. If we are to have hospital insurance, the rates should be raised to a point where co-insurance is not necessary. It must be realized that when co-insurance has been paid by an individual, or for a family group, in any one year, the incentive to keep out of hospital is removed. It can only be effective once. Mr. R. Lingford, Salmon Arm, B.C.—As for this co-insurance, it is a tragic error, in my humble opinion. It brings up again the phantoms of worry and fear to countless people who are already having a hard struggle, even when in good health, to make ends meet. It may even endanger the lives of some, who would prefer to stay away from hospital rather than be forced into more debt, even though hospitalization is essential for them. Co-insurance kills the whole principle of insurance. It is not insurance at all, but an unfortunate idea of extracting money from the sick for the benefit of the hospitals. The few sick have more burden placed upon them to pay for the many, instead of the many paying for the few. Mr. A. H. Povah, Hospital Accounts Collector, Kelowna, B.C.—Co-insurance is the greatest factor. It hits a man when is down and least able to take it—when his earning power is cut off and his expenses are mounting. It hits the young mother going to hospital for her child— attacks on young growing families. It has been stated the reason for co-insurance is that patients over-stay at the hospital. This is not so. The patient is helpless. He has no say whatever in the matter; the doctor orders him in, and orders him out. These patients should not be assessed an extra $2.50 per day at a time when they are least able to pay it. These written submissions were repeated verbally throughout the length and breadth of the Province by individuals speaking for themselves and also acting as representatives of other organizations of repute. The Board, when visiting Saskatchewan to study the Saskatchewan Hospital Services Plan, had the privilege of meeting with the executive officers of the Saskatchewan Hospitals' Association. The Board learned that no co-insurance is charged in Saskatchewan; and, in discussing the subject with the Board, Mr. Bassett, president of the association and administrator of the Prince Albert City Hospital, stated that they like the present system of the S.H.S.P. whereby the hospitals are paid a definite sum twice monthly by the Plan; and he believed that this assurance of a certain monthly income acts in some measure as a deterrent to the overcrowding of hospitals and the temptation to secure as large an occupancy as is possible. He further stated that the association would not recommend a co-insurance charge and would not O.K. it unless the Government showed a definite inability to meet hospitalization costs. Mr. Bassett continued that hospitals would be very unpopular with the public if they took any other stand; and, furthermore, the hospitals did not desire to go back to the position of being collection agencies. The Board has come to the conclusion that the weight of evidence is against the continuance of the co-insurance charge. It is doubtful if it has accomplished its primary ■■■■ :- FF 22 BRITISH COLUMBIA objective of curtailing the abuse of hospitalization. Neither has it been demonstrated that the additional net revenue resulting therefrom has been sufficient to outweigh the ill will created by the charge—and the Board is of the opinion that if it is considered definitely necessary to obtain that additional revenue, it may be well and advisably sought from other sources. The Board therefore recommends that co-insurance charges against patients in hospitals be completely abandoned. No. 5.—FINANCING OVER-ALL DEFICITS OF THE PLAN The matter of whether or not the Government should subsidize the Hospital Insurance Fund substantially or should expect it to be self-supporting is a subject of basic policy. Many submissions made to the Board were to the effect that hospital costs have reached the point where the individual is no longer able to meet hospital bills in full. By the same standards, it can be assumed that no group of individuals can meet hospital costs for that group without a subsidy. Information gathered from many sources has convinced the Board that the premium income collectable by B.C.H.I.S. can be substantially increased and that administration costs can be substantially reduced. It is impossible at this time to estimate to what extent the net premium income will go toward meeting future over-all hospital costs, and until changes as recommended by this Board relating to registration and premium collections are actually established, it is not possible to arrive at a reliable estimate of the amount likely to be required from consolidated revenue and the definite formula for Government support of the Service from that source. The Board therefore recommends that a long-range programme of financing the Service be developed, with a definite policy and formula of Government financial support, and that there be established a policy that should a deficit develop in the hospital insurance financial year for reasons over which the hospitals and B.C.H.I.S. had no control or which could not reasonably be foreseen by B.C.H.I.S. or the Government, then the said deficits shall be paid from consolidated revenue. No. 6.—MUNICIPAL AND PROVINCIAL PER DIEM GRANTS A great deal of evidence was gathered, and many opinions and suggestions were submitted to the Board regarding the entire subject of municipal contributions toward hospital finances, not only in connection with the capital cost of construction and equipment, but also with regard to the operating costs. In view of the situations existing in some localities, the main interest tended to centre on the matter of the municipal liability for, or contributions to, capital outlay. This particular aspect will be dealt with elsewhere. We are here concerned with the matter of municipal contributions to hospital operating costs. While this subject was not referred to in many written briefs placed before the Board, it was very generally discussed between the Board and those appearing before it. As an example, however, of opinions verbally repeated quite frequently, we quote the following from the written submission of the Hospital Employees' Federal Union, of Vancouver, dated August 13 th, 1951:— There has been no increase in the contribution of 70 cents per day toward the upkeep of hospitals which the municipalities have been paying for the past ten years. A contribution of 70 cents per day to-day is equivalent to only 35 cents as compared with ten years ago. In terms of purchasing power, hospitals are receiving only 50 per cent of the value of the contribution at the time the figure of 70 cents was agreed upon. Of all municipal services, hospitals alone have not received an increased share from local taxes. Roads, sewers, schools, fire and police protection, and the whole range of essential municipal services are now being financed and maintained at much higher costs. Hospitals are no less REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 23 important to citizens than any of these other services. The local community has a responsibility towards its hospitals. It is scarcely logical that such an important service should be discriminated against in this way. Hospitals should share in the increased taxes which are being levied and collected by local authorities. It is undeniable that the municipal contribution of 70 cents per patient-day toward hospital expense is a figure that has remained unchanged over a considerable number of years, when every comparative figure was rapidly increasing. There is perhaps not much need to develop an argument to demonstrate the fact, or the opinion, that in the light of present-day prices and values this 70-cent contribution is no longer fair or adequate. Proceeding to another phase of the same subject, many suggestions were made to the Board as to the desirability of changing the basis of contribution—substituting for the present per patient-day basis a per capita basis, enabling much simpler calculation and doing away with a very considerable amount of record-keeping, accounting, and checking. On this particular phase of the subject, The Corporation of the City of Penticton had the following to say, in a written brief presented to the Board on August 8th, 1951:— Firstly, the present method of invoicing municipalities for the per diem charges on a patient- day basis is in our opinion a costly undertaking, costly not only for the Insurance Service in invoicing municipalities on the basis of actual occupancy of a hospital bed, but also costly to the municipality being invoiced in that each item on the invoice must be checked to insure that the municipality is not being invoiced for a patient not the responsibility of the municipality concerned. It has been our experience that much correspondence is necessary in order to establish responsibility in some cases and the facts when obtained are so meagre that the municipality originally billed is eventually stuck with the costs. It is, of course, appreciated that recourse may be had to a board of arbitration to establish responsibility but the machinery is too ponderous and the delay is too great for a municipality to make much use of this procedure, especially where comparatively small amounts are concerned. It is further noted that there is great delay in the invoicing on a per diem basis. In some cases the invoice is not received for many months after the patient has been discharged from the hospital and it will, of course, be appreciated that until the account is received by the municipality the Hospital Insurance Service cannot collect the per diem charges. It is suggested that the per diem charges be made on the basis of population such as this municipality enjoyed during 1950. A per capita basis of per diem charges would enable the council to budget for the full amount which would be required to be paid during the year and the Hospital Insurance Service would also have an indication of what revenue might be expected from this source. The same view-point has been verbally put forward by several hospital administrators and municipal officials directly concerned with the receipt or payment of these contributions. The Board was further informed by the Minister of Health and Welfare that for a time the Department gave to the municipalities the option of contributing on the per capita basis, but that due to a partial acceptance only of the option it was afterwards discontinued and the patient-day basis reverted to entirely. The Board has become convinced that, from any point of view, what might be lost to the Hospital Service by placing this contribution on a per capita basis will be saved in costs attachable to its operation. We now proceed to a further phase of this particular problem—a phase concerning which very strong opinions were expressed to the Board from time to time. This concerns the entire subject of the contributions made, or not made, by a municipality or by an unorganized territory toward the cost of hospitalization (of residents of such municipality or unorganized territory) in hospitals in other municipalities, more particularly where there is no hospital in the municipality or unorganized territory from which the patient comes. As in the case of the first phase of this entire problem, the interest and discussion tended to centre around the contribution to capital expenditure, but nevertheless there exists a firmly based opinion in the organized municipalities, and on the part of the hospital boards there, that the per patient-day contribution toward hospital costs from FF 24 BRITISH COLUMBIA outside municipalities or unorganized territories is not adequate or equitable, and that the said outside municipalities or unorganized territories should be required to make a larger contribution to the cost of hospital care of its residents than the contribution made by a municipality having a hospital within its own limits. The entire subject is a very involved and contentious one, and it is not possible to set out here all the considerations or arguments that are advanced from different view-points, but the Board has come to certain conclusions on all these matters, and— The Board therefore recommends:— (1) That the per diem contribution paid by municipalities, or by the Government in the case of unorganized territories, shall be increased from the present basis of 70 cents per patient-day to the sum of $1 per patient-day: (2) That consideration be given to basing the contribution mentioned above on a per capita basis rather than the present per patient-day basis, with the per capita rate thereof being set to produce an approximately equal amount of revenue to the Service: (3) That where a resident of a municipality or of an unorganized territory is hospitalized in a hospital outside the confines of his own municipality or territory, the said municipality, or the Government on behalf of the unorganized territory, shall pay an additional 25 cents per patient-day in connection with such patients. This additional payment shall be made direct to the hospital in question, to be treated as non-operating revenue of the receiving hospital, and the hospital concerned shall be required to bill the proper authority for this additional 25 cents per patient-day charge. No. 7.—FUTURE INCREASES OF PREMIUM RATES OR CURTAILMENT OF BENEFITS When giving consideration to the desirability or otherwise of a change in the premium rates now in effect, and on which point the recommendation of the Board is recorded in Recommendation No. 3, the Board also took under advisement the changes which had been made in premium rates since the initial date of the operation of the Service—namely, January 1st, 1949. There was an increase in the original premium rates, which increase was made effective during the first year of operation of B.C.H.I.S.—namely, 1949. There was then a further increase in the premium rates, effective for the year 1951. This was authorized by the Legislature of 1951, and its actual operation was effective from July 1st. However, the premium which was altered was the annual premium for the calendar year. The Board has elsewhere made clear that it is in agreement with the principle and policy of an annual premium, although this may be paid or payable in two instalments. They have given careful thought and consideration to the procedure which has been followed up to date in putting increases of premium rates into effect, and they are of the opinion that it is unfair and not in accordance with sound business practice to institute an increase in a premium under a Compulsory Insurance Act with the said increase having a retroactive effect. It is not necessary to advance all the considerations which caused the Board to come to this definite opinion. It should be sufficient to point out that such a retroactive step causes a very considerable resentment in the minds of the premium-payers of the Province, who generally believe that they are entitled to full and adequate advance notice of any such changes as may be contemplated and finally approved by legislative action. The Board therefore recommends that there shall be no further or future increase in the premiums required to be paid annually, and no reduction of benefits conferred by the Act, within any premium year, and that any such changes as may be, from time to time, authorized by Act of the Legislature, affecting the annual premium payments, or the REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 25 benefits conferred by the " Hospital Insurance Act," shall have effect only at the commencement of the next premium year. No. 8.—EXEMPTION OF GROUPS ON RELIGIOUS GROUNDS In view of the fact that application was received from another religious body for the same exemption for their members as is now enjoyed by members of the Christian Science Church, the Board gave the matter careful consideration. It seems obvious that if the door to exemption on religious grounds was widened by the admission of further bodies, the requests for this treatment would increase and the difficulty of deciding as to the merits of the application of one denomination as against that of others would be a most serious problem. Further, the Board takes the position that Hospital Insurance Service in its present form is a public service of the Province that may be compared with education, other forms of social assistance, and even the provision of highways, toward which, as in the case of all such public services, every citizen must contribute his fair share for the general good, even if the benefits arising from such public services are not equally distributed amongst individuals. It should be noted that the Board has ascertained that in the Province of Saskatchewan members of the Christian Science Church are not exempted from the provisions of the Saskatchewan Hospital Services Plan and that no application for exemption by that group has been made. The Board therefore recommends that in future no group of citizens of the Province be exempted from the provisions of the " Hospital Insurance Act" on religious grounds and that the present exemption extended to members of the Christian Science Church shall be discontinued. No. 9.—EXEMPTION OF GROUPS: CANADIAN PACIFIC EMPLOYEES' MEDICAL ASSOCIATION OF BRITISH COLUMBIA AND TELEPHONE EMPLOYEES' MEDICAL SERVICES ASSOCIATION OF BRITISH COLUMBIA. Apart from the group of persons which has been up to date exempted on religious grounds—namely, the Christian Scientists—the only other groups exempted from the provisions of the Act are the members of the Canadian Pacific Employees' Medical Association of British Columbia and of the Telephone Employees' Medical Services Association of British Columbia. The Board wishes to go on record as believing that it is desirable to look forward to the time when there shall be no group of citizens of the Province subject to special exemption from the provisions of the Act, and— The Board therefore recommends that the position of the present exempted groups referred to above shall be reviewed by competent authority as soon as possible, with a view to bringing the members of such groups directly within the operations of the B.C.H.I.S. at such a time as it may be found feasible and advisable to so do. No. 10.—EXEMPTION FROM PREMIUM LIABILITY: LOW-INCOME GROUPS As was to be expected, many representations were made to the Board on behalf of those people in receipt of very low incomes who are nevertheless expected to pay B.C.H.I.S. premiums because they are not in any class to which exemption has so far been granted. These not only included relatives and dependents of protected veterans, etc., but the many private people without any particular classification or standing who exist on a limited retirement or investment income, or on limited earnings. Dealing particularly with the first class, that of the dependents or relatives of veterans, we quote from a brief of the British Columbia Command of The Canadian Legion, as follows:— FF 26 BRITISH COLUMBIA Low Income Groups (Exemptions) For three years in succession we have presented requests to the B.C. Government for exemption from payment of premiums by: — (1) Wives of recipients of War Veterans Allowance. (2) Widows—recipients of an allowance under the regulations of the War Veterans Allowance Act. (3) Recipients of Dependent Parents Pensions paid under the regulations of the Canadian Pension Act. (4) Dependents of members of the Canadian Armed Forces (on overseas service). (5) Other low income groups not included in the groups named in this brief. It should be noted that as a result of Department of Veterans' Affairs regulations, the Federal Government has relieved Provincial Governments of large expenditures of money through Social Welfare sources, by paying War Veterans Allowances to veterans, and to their widows, and also by granting complete hospital and medical services to war veterans, in receipt of War Veterans Allowance, irrespective of the cause of disability requiring treatment. In addition, grant of pensions to dependent parents of deceased veterans by the Federal Government has assisted in relieving Provincial Governments from extra expenditures on Social Welfare. The maximum allowance paid under War Veterans Allowance Act regulations is: Married veteran, $70.83; single veteran, $40.41; widow, $40.41. Dependent parents pensions usually run around $40.00 monthly. Present Exemptions The Provincial Government has already recognized that low income groups should not be called upon to pay hospital insurance premiums, but such exemptions have only covered those people in receipt of Old Age Pensions and the Blind who receive a pension. Persons in receipt of Social Assistance are also exempted from payment of premiums. We submit that recipients of War Veterans Allowances, their widows, and those in receipt of Dependent Parents Pensions from Federal sources are in a less favourable financial position in British Columbia than people receiving Old Age Pensions, including the Blind. We feel that action to exempt the groups that we have named in this brief is long overdue. Other Low Income Groups We realize that other groups in receipt of low incomes, as well as those in whom The Canadian Legion is primarily interested, have a similar claim to exemption from payment of hospital premiums, and it will be noted that they are also included in this brief. Cost of living is not going down, and we feel that steps should be taken at the earliest possible date to exempt low income groups from payment of hospital premiums and that they be provided with a hospital card. As regards the over-all body of people in the low-income groups, we quote from the brief of the Vancouver, New Westminster and District Trades and Labour Council:— There is a large group of persons who cannot be classed as average wage earners—namely, the people in the low income group—and we suggest that the purpose of the legislation under section 7 was to alleviate the hardship of assessing pensioners and other persons for the Hospital Insurance premium who are not in a position to pay yet are deserving of the benefits under the Act. This committee feels that there are many persons equally deserving of the benefits and are now being assessed who are in no better position to pay the premium than the pensioner. Persons earning $100 per month or less are faced with a continual struggle to meet the high cost of living without the added burden of having to pay hospital premiums. As would be the case with pensioners, assessing people in this income group is in effect depriving them of the basic necessities of life and is not consistent with the whole tenor and purpose of the legislation which is to benefit all persons even those who cannot possibly meet the premium payments. We submit that section 7 of the Act be amended to include all persons in receipt of income of $100 per month or less. From the brief of the British Columbia Retired Civil Servants' Association:— At the general meeting of our Association today I was directed to call your attention to many of our members who receive less than the old age pension rate which entitles recipients to free medical aid and hospitalization. Last year, in addressing our body, the Hon. A. D. Turnbull stated that those who could not pay for the hospital service would not be compelled to do so with no fixed limit as to income. At the same time these of our members feel that they are actually REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 27 under legal compulsion to pay the premiums and are under the threat of prosecution if they fail to do so. What they may be given as a favor they would rather receive as a right. We would ask therefore that your Commission take this matter into consideration, and, if possible, recommend some legislation that would relieve those in these low income brackets of their present anxiety. And from the brief of the B.C. Federation of Labour:— We ask this Committee to give serious consideration to the following proposals:— (2) That Clause 7 (exemption from premiums) be extended to include all those whose total income is derived from compensation pensions, war pensions and pensions from other Governmental sources, or whose income is less than $100 per month. Also from the North Sidney Property Owners' Association:— We feel, very strongly, that something further should be done to provide relief from hospitalization costs to persons in the lower income brackets. In addition, we quote from letters received from individuals, which contain samples of many representations that were placed verbally before the Board by people all over the Province in similar categories, who felt themselves to be in distressing positions:— From Mrs. K. H. Ramage, Sidney.—It is quite impossible for us to continue paying the hospital insurance. We are living on a fixed income of under $70.00 a month and we are not old enough to claim the old age pension. We own our own house and by the time we have paid taxes, insurance, water, light and fuel there is little enough left for food, let alone anything else. Up to now we have paid the premiums out of our capital, which of course reduced our income and cannot go on. In any case people in our circumstances cannot afford to call in a doctor and pay the enormous fees they are asking now. From Mr. Albert Flavell, White Rock.—I wish to make the following submissions to your Board: That the recent increase in B.C.H.I.S. fees is a direct tax on the low income and low wage group for the benefit of high income groups. The writer is in the very low income group and owing to the high B.C.H.I. fees is unable to see a doctor on necessary occasions and thus is unable to get hospitalization. Persons of my age—62—and income, therefore, are condemned by B.C.H.I. to the use of hospitals only for the purpose of getting a passport to the cemetery. Except for food the $30.00 B.C.H.I. levy is my largest yearly expense, and is 20% of my expected yearly cash income. The Blue Cross protection @ $12.00 per year from 1943 to 1948 was enjoyed by me and was quite satisfactory. We wish to make it clear that many of these submissions were made to the Board prior to the introduction of the Federal old-age pension for people of 70 years and over, and the implementing legislation passed by the special session of the British Columbia Legislature. Prior to this special session, the Minister of Health and Welfare appeared before the Board and discussed what general policy might be adopted concerning hospital insurance premiums, etc., for the entire class of people in low-income brackets. The Board had not at that date had sufficient time to give careful consideration to the subject but, as a result of its further deliberations, has arrived at a decision which it thinks may fairly deal with the whole problem, and— The Board now recommends that in the case of persons not otherwise exempted from the personal payment of premiums and who can establish that their income is not more than $720 for the year in the case of a single person or $1,200 for the year in the case of a married person, the said persons shall be exempted from personal payment of the premium but that the proper premiums for them shall be paid to B.C.H.I.S. by the proper Government department. FF 28 BRITISH COLUMBIA No. 11.—EXEMPTION FROM PREMIUM LIABILITY: > STUDENT NURSES UNDER 21 The position of student nurses with regard to payment of B.C.H.I.S. premiums was placed before the Board in writing by one or two organizations. The Kamloops- Tranquille Chapter of the Registered Nurses of British Columbia has the following to say:— We understand that University students are exempt from this ruling, in which case do you not think that student nurses should come under the same category? Speaking for several individuals, Mr. H. H. Piper, of Kamloops, wrote as follows:— I certainly think the Hospital Insurance Service must be pretty hard up, on the other hand, they should not be after collecting $15.00 from every student nurse in training in B.C. hospitals, when they have to collect from student nurses when they have already paid through the parents. The Royal Columbian Hospital of New Westminster made the following suggestion:— Nurses in training be recognized by the Hospital Insurance Service as students until they reach 21 years and consequently remaining as dependents under coverage of parents or guardians. The matter, which is an important one to those concerned, was followed up verbally in the discussions before the Board by such organizations as the Registered Nurses' Association of British Columbia and others, and it was agreed that the educational standing of student nurses in this regard should be recognized. The Board therefore recommends that student nurses, not over the age of 21 years, be recognized as dependents in the same manner as those persons presently covered by subsection (d) of section 1 of Regulation 1, under which dependents are defined. No. 12.—BENEFITS: OUT-OF-PROVINCE HOSPITALIZATION The limited benefits allowed a beneficiary under the Act for hospitalization outside the Province of British Columbia were the subject of a considerable number of representations made to the Board. These had to do not only with the particular situation which exists in certain border areas such as the Peace River Block, but also with the entire matter of non-elective hospitalization outside the Province. The following are quotations from some of the written briefs submitted to the Board, having to do with the difficulties caused by geographical location:— Dawson Creek Chamber of Commerce.—Where a registrant leaves the province, the B.C.H.I.S. will only pay $6.50 a day for a period not exceeding thirty days. Situated as we are in a town adjacent to the border, this works a hardship on border residents. It is very often necessary to send a patient to the City of Edmonton (which is the closest large medical centre) for further treatment and it is our opinion that the benefits paid by the B.C.H.I.S. should be extended to persons who are attending hospitals outside the Province on the advice of their physicians. They are entitled to unlimited coverage within the Province, and should not be prejudiced due to geographical location. This matter has been taken up with the B.C.H.I.S. by the Dawson Creek Chamber of Commerce before but nothing in a remedial way has been done. Farmers' Union of Alberta, B.C. Section.—If section 28 of the Act cannot be brought into effect so as to allow patients full benefits under the Act when forced to seek specialists' advice at Edmonton, and to be hospitalized there, then some special arrangements should be made where beds can be secured at Vancouver whenever necessary and not just in case of life or death, and that some allowance should be made the patient for the additional travelling costs. Our doctors here are all familiar with Edmonton doctors and hospitals, and this is not the case when it comes to Vancouver. C.C.F., Peace River Block, Dawson Creek.—The geographical location of the Peace River Block has not only retarded development in this section of British Columbia, but has created problems here such as probably will not be found in other areas of British Columbia. As rural hospitals are not as well equipped as their urban counterparts, many persons who require specialist treatment must travel to Edmonton which is the nearest city to secure this service, and because this city is outside the province, persons unfortunately needing treatment are penalized by going to Edmonton as the B.C.H.I.S. only pays $6.50 per day for thirty days, REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 29 whereas if they could afford to go to Vancouver then the B.C.H.I.S. would pay the rates allowed to the hospitals in the latter City. Mr. W. G. Cowan, Postmaster, Field, B.C.—Due to our location in the province, which is only about 12 miles from the Alberta border line, we are compelled for reasons of economy in transportation and at the same time to secure the services of competent doctors, to go to Banff, Alberta, when hospitalization is necessary, but because of this we are penalized by the B.C.H. Commission. We pay the same premiums as other residents of the Province but only receive about half the benefits. The Commission pay $6.50 per day for hospital accommodation; all other extras such as medicines, X-rays, dressings, etc., has to be paid by the patient. This, you will agree, is poor coverage compared to other residents. Such a set-up is causing much concern and bitterness against B.C. Hospital Insurance, especially to the working class in the lower income groups. It should, however, be clearly understood that these are not the only places which by reason of their geographical location find it almost essential to send residents out of the Province for their hospitalization. Where this action is non-elective and not of their own choosing, it would certainly appear at first consideration that, having paid the same premiums as all other registrants, the people referred to are entitled to the same measure of protection against hospitalization costs, wherever that hospitalization needs to occur. There is, in addition to the exigencies imposed by boundary or geographical locations, the matter of persons fully covered by the payment of premiums who are absent from the Province and because of circumstances over which they have no control are forced to use the services of hospitals elsewhere and may consequently incur bills of much greater proportions than if they were hospitalized in the Province of British Columbia. The allowed benefits, being limited as to both rate and time, seem to the Board to be somewhat less than fair. However, the Board realizes that there must be some limitation placed on these benefits in order to prevent abuse from one source or another, and in an attempt to reach a more reasonable and equitable solution of the problem— The Board now recommends that when a registrant under B.C.H.I.S., or his dependents, in good standing is compelled by circumstances beyond his control, or on the definite advice of his physician in British Columbia, to take hospital treatment outside the confines of the Province (more particularly when the home of the patient is so geographically located as to make the out-of-Province hospitalization necessary or desirable), B.C.H.I.S. shall pay for the said hospitalization a rate of $6.50 for each patient-day up to a limit of thirty days, plus a maximum of 50 per cent of the cost of all extras which would be covered completely by B.C.H.I.S. if the treatment was in a hospital in the Province. No. 13.—BENEFITS: OUT-PATIENT SERVICES Many suggestions were made to the Board with regard to out-patient services, especially those in connection with diagnostic procedures. After exhaustive consideration of these several suggestions, the Board was obliged to recognize the fact that revisions are desirable in the services already included or to be included in the Hospital Service plan, but did not consider this was a proper time for a recommendation for the extension of services or changes in the regulations relating to out-patient treatment. The Board, however, feels that study and due consideration should be given as soon as possible to this phase of hospitalization and, because of the possibility that some extension of out-patient benefits may be a desirable deterrent to bed occupancy and effect a possible net saving in total hospital costs,— The Board therefore recommends that careful study be given as soon as possible to the question of benefits having to do with out-patient services of hospitals, with a view to setting up the most desirable scheme from the view-point of service and the insured public, and that changes as decided upon be put into effect in the Province. FF 30 BRITISH COLUMBIA No. 14.—CHARGES FOR NON-ELECTIVE USE OF PRIVATE AND SEMI-PRIVATE WARDS There have been many requests for elimination of the extra charge over and above the public-ward rate for private and semi-private wards when occupied by patients who do not elect to occupy private or semi-private wards but are placed therein because of a lack of public-ward accommodation—such patients having paid their premiums. A general opinion expressed before the Board in this matter is reflected in the recommendation of the British Columbia Federation of Labour, quoted as follows:— We ask this committee to give serious consideration to the following proposals:— (3) That whenever a patient requires hospital care and beds are available, irrespective of the ward, that those patients be admitted without any extra cost to the patients. The Board therefore recommends that in the case of non-elective use of private- or semi-private-ward accommodation in hospitals within the Province there be no extra charge to B.C.H.I.S. registrants for the said accommodation. No. 15.—PREMIUMS PAYABLE BY WIVES OF CERTAIN VETERANS On a point related to the treatment of pensioned veterans and other persons of low income, representations were made to the Board concerning the premium payable by the wife of a veteran who is himself completely covered for hospitalization by the Department of Veterans' Affairs, and for whom, therefore, no B.C.H.I.S. premium is payable. It had apparently become the custom, because of the changing regulations applicable to D.V.A. pensioners, for the administration of B.C.H.I.S. to take the stand that although such veteran might be completely covered for D.V.A. treatment for pensionable disability, he must, nevertheless, pay a premium to protect himself from charges which might be made by a general hospital in the event of his requiring hospitalization for some other ailment which, in many cases, might be the result of an accident. Having taken this stand, the B.C.H.I.S. also decided that in any case the wife, not being a single person, must be covered by payment of the full premium imposed on the head of a family. The entire matter is a very involved and complicated one, and it would seem impossible to lay down rules that would cover every contingency that arises in connection with such a person. The Board realizes the difficulty of stating a permanent policy in this regard. However, in an attempt to cover the comparatively few cases where hardship would otherwise be inflicted— The Board now recommends that in the case of married war veterans who are themselves completely covered for hospitalization by the provisions or regulations of the Department of Veterans' Affairs at the time being in force, the premium required to be paid by, or for, his wife (in case the family income is over $1,200 per annum) shall be the premium of a single person. No. 16.—HOSPITALIZATION OF TREATY INDIANS—FEDERAL GOVERNMENT RESPONSIBILITY The Department of Indian Affairs of the Dominion Government pays to B.C.H.I.S. premiums as called for by the " Hospital Insurance Act" for Indians living on reservations in the Province. It has been brought to the attention of the Board that in 1950 the hospitalization cost of Treaty Indians exceeded the premiums received for the entire group of Treaty Indians by over $353,000, and it is estimated that the excess cost of the hospitalization of Treaty Indians in 1951, above the amount of premiums received for the entire group, will amount to over $435,000. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 31 According to information placed before the Board, it is an undoubted fact that Treaty Indians, as a group, show a very high incidence of illness, resulting in a longer length of stay in hospital than that of the average patient. At the time the members of the Board visited Regina to study the Saskatchewan Hospital Services Plan, they were informed that the Saskatchewan Plan did not accept the responsibility for hospitalization of Treaty Indians within the Province on a premium basis, but that the complete cost of such hospitalization remained the responsibility of the Dominion Government. The Board is of the opinion that the Province of British Columbia is certainly not being fairly treated in this connection, nor should it continue to bear the very heavy burden imposed upon it by a particular group, which, prior to the enactment of the "Hospital Insurance Act," was the complete responsibility of the Federal authorities, and— The Board therefore recommends that arrangements be made with the proper department of the Government of Canada for payment by it of the total cost of hospitalization of Treaty Indians of British Columbia. No. 17.—PAYMENT FOR HOSPITALIZATION OF "SOCIAL AID" CASES It has been drawn to the attention of the Board, by the Commissioner of B.C.H.I.S., that the cost of hospitalization for those patients generally known as Social Welfare cases, and including specifically (1) Social Assistance and Japanese, (2) Old-age pensioners and blind pensioners, (3) Mothers' Allowance cases, and (4) Child Welfare cases, was very considerably in excess of the premiums paid to B.C.H.I.S. on behalf of the total number embraced within these groups. Messrs. Stevenson and Kellogg Limited have supplied the Board with the actual figures for the year 1950. The cost of hospitalization of persons coming within these groups during that year was $1,960,559, and the total premiums paid to B.C.H.I.S. to cover the complete membership of these groups was $1,010,857, indicating that the hospitalization of this number cost $950,000 in excess of the total premiums for the entire group. The Board was also given the 1951 figures on an estimated basis. At the time these estimated figures were compiled, the exact figures to August 31st were available. The estimated figures for the entire year are: Hospital costs, $2,552,860, and premium receipts, $1,284,623, or an excess cost of $1,268,237. Against this, however, must be set the co-insurance charges, which will be, or have been, paid by or on behalf of those persons hospitalized, which is estimated to amount to $253,000, so that it may be said that the 1951 excess of cost over revenue, as affecting this class of persons, is approximately $1,000,000. The British Columbia Hospitals' Association took a keen interest in this phase of the operations of B.C.H.I.S., and we quote from their brief, as follows:— Social Welfare A study of the incidence of illness and the average length of hospitalization will disclose that the cost of hospital service to persons in receipt of social assistance is considerably in excess of the premiums paid by the Government on their behalf. We feel that this burden should not be passed on to the insurance premium paid by the public. We feel that an appropriate amount should be paid into the Fund through Provincial Welfare budgets to cover this. Despite ail efforts to restrict stay in hospital to persons really in need of hospital care, and for no longer a period than is necessary, many cases of over-stay do occur. The causes almost invariably come under the heading of welfare. The cost of this should not be debited against the hospitals. Nine times out of ten cases of this kind are the direct result of lack of suitable provision elsewhere. Thus a problem which does not properly belong to the hospitals is thrust upon them. We feel that suitable Provincial-Municipal grants should be paid into the Fund to take care of this. It may, of course, be claimed that the fact that there is an excess of cost over premium income in connection with these cases does not make any difference in the long FF 32 BRITISH COLUMBIA run because the Government of the Province is meeting the deficits of the B.C.H.I.S., and, therefore, if it pays specifically out of welfare funds or consolidated revenue for this hospitalization, it would have to meet a lesser deficit of B.C.H.I.S. The Board feels, however, that it must not lose sight of the fact that it is dealing with an insurance service, and that these particular cases constitute what would be called in commercial insurance circles a " hazardous risk," which risk would be either refused by the insurance brokers or subjected to a special excess premium. Nor does the Board consider it is fair that B.C.H.I.S. (which in a measure is a separate subdivision of the Department of Health and Welfare and which is asked to submit its own accounts covering all operations under the Act) should be compelled to include therein a particular class of operations which it knows is being conducted at a loss of $1,000,000 per annum. It must be realized that if there were no Government Hospital Insurance Service, Health and Welfare or some other agency would be responsible for the actual hospital bills of these people. The Board therefore recommends that those persons comprising the groups of Health and Welfare cases referred to above be no longer accepted by the Service on an ordinary premium basis, but that the responsible Government department—namely, the Department of Health and Welfare—pay the full cost of hospitalization of all such persons coming within these groups, such payments to be made to the B.C.H.I.S. No. 18.—EDUCATIONAL GRANTS-IN-AID TO COST OF OPERATION OF TRAINING-SCHOOLS FOR NURSES The Board heard a considerable number of representations having to do with the implications arising from the fact that the cost of training student nurses (in places where the hospital actually has a training-school) is included as part of the total hospital- operations cost and is, therefore, reflected in the estimated, and finally accepted, budgets and the per diem rates. It must be remembered that the number of hospitals actually operating training-schools for nurses is a small minority of the total number of hospitals in the Province. Amongst the written submissions placed before the Board, the British Columbia Hospitals' Association had this to say on the subject now dealt with:— Education Part of the work of certain hospitals is purely educational. We feel that the cost of this should not be a charge against insurance premiums, neither should it be permitted to place an unfair burden on the student. Education in hospitals is by no means limited to student nurses. It includes internes, and different classes of technicians. We feel that the cost of education should be assessed separately from the cost of service to patients, and that the rate paid to hospitals with approved educational programs should take the educational program into consideration. We feel that the cost of education in hospitals should be calculated and an equivalent amount paid into the Insurance Fund from Provincial Education budgets to cover that cost. The Registered Nurses' Association of British Columbia dealt with the matter as follows:— At the present time the cost of operating schools of nursing tends to be confused with the cost of operating hospitals. Schools of nursing should operate under independent budgets which set forth clearly all sources of income and all estimated expenditures. Government has accepted responsibility for education for the professions with the exception of nursing. We believe that the Government has a responsibility for nursing education as well and we urge that where it can be shown by recognized methods of cost analysis that a school of nursing is costing the hospital more than the value of services given by the students of that school this difference be met by Government grant-in-aid to the school. And the Royal Columbian Hospital, at New Westminster (which was not at that time a member of the British Columbia Hospitals' Association), expressed a similar view-point in a suggestion worded as follows:— REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 33 Education grants (should) be provided training hospitals to subsidize student premiums, instructors' salaries, cost of uniforms, food, laundry, linen, etc., rather than have these expenses included in the operating costs of such hospitals. It was further pointed out to the Board that the few training-schools in existence in the hospitals in British Columbia were regularly training a larger number of student . nurses than sufficed to supply their own year-to-year need of trained nursing personnel, and that they were, therefore, undertaking this educational training partly for the benefit of all hospitals of the Province. The Board endeavoured to ascertain, with a degree of certainty, the margin of net cost to a hospital which operates a training-school for nurses, arising out of the difference between salary, room, board, or other costs or allowances paid to student nurses and instructors (plus the cost of building upkeep and maintenance) and the value of the services rendered in the hospital by the student nurses. It would appear that no positive figures are available, but in the Province of Saskatchewan the Board was informed that a study of training-school costs made in the general hospitals at Regina and Saskatoon showed the services given by student nurses to have a value much less than the cost of training, the differential varying from $60 to $140 per trainee per annum. These facts being taken into consideration, there would appear to be ample justification for support of the suggestions and submissions made to the Board, as already outlined. In addition to this, it must not be forgotten that there is a very widespread impression prevalent throughout the Province that the premium-payer in certain sections of the Province, adjacent to what may be called only " moderate " hospitalization facilities, is unfairly called upon by being compelled to pay exactly the same premium as the residents of an area adjacent to a hospital with far more adequate and costly facilities. While the problem of a possible classification of hospitalization facilities has not been dealt with exhaustively in this Report, the general subject may be referred to in other parts hereof. Confining the matter to the particular subject of the cost of training- schools, however, the Board feels that a case has definitely been made out, and— The Board therefore recommends that training-schools for nurses, in conjunction with hospitals within the Province, be considered as educational institutions in so far as it is necessary to enable them to come within the provisions for grants-in-aid from the Department of Education, to the end that the net cost of operating such training- schools shall in no way be a part of, or taken into account as, an operating cost to be covered by B.C.H.I.S. No. 19.—CHRONIC CASES: LIMIT OF B.C.H.I.S. LIABILITY While another recommendation of the Board has dealt with the matter of procedure necessary in order to handle properly the very important subject of diagnosis of chronic cases, the Board nevertheless feels that there are very weighty considerations which justify further action to alleviate the burden that may be placed upon certain sufferers who enter an acute or general hospital and are later found to be in the " chronic " classification. It has been pointed out that there are many such patients (not being the responsibility of the Social Welfare Department) whom it is found impossible to move from the said acute or general hospital at the time it is decided that the patient is a chronic case. This situation arises from various causes, which will be easily understandable, the chief amongst them being the lack of available beds in institutions for the treatment of chroni© ailments and the inadvisability of returning the said patients to their homes. It cannot be denied that the particular cases to which we have referred are still, to some degree, a responsibility of the Province as a whole, and if the Province does not recognize this responsibility in some degree, directly, such cases will definitely either become a charge on the Social Welfare Department or be left to suffer the very grievous consequences of being faced with crippling financial liability at a time when they are FF 34 BRITISH COLUMBIA positively and completely unable to help themselves. Much has been said to the Board on the tragic effects caused by financial worry pressing upon any sick person, and this particular kind of case is one in which these effects are most clearly evident. For these reasons, therefore, the Board has given this matter very considerable and earnest thought, and— The Board now recommends that the liability of B.C.H.I.S. for an account in a general hospital incurred by a patient who is a registrant, or dependent of a registrant, in good standing under the Act, who has been declared to be a chronic case, shall continue until they have been otherwise placed, but in no case shall it continue more than sixty days beyond the effective date at which the case has been ruled otherwise to be a chronic case. The ruling referred to is the decision of the Medical Board of Review, if the diagnosis has been referred to them; and this recommendation is intended to apply to cases remaining in hospital which do not become the responsibility of the Social Welfare Department. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 35 SECTION 3.—MATTERS OF POLICY—GENERAL 20. B.C.H.I.S. Management Board and Select Standing Committee. 21. Hospital Advisory Council. 22. Public Relations of the Service. 23. Field Representatives of B.C.H.I.S. 24. Exempted Areas. 25. Annual Accounts of B.C.H.I.S. 26. Premium-year. 27. "Chronic" Diagnosis: Provisions for Review. 28. Provision for Permissive Use of Special Drugs. 29. Premium-payment Enforcement: Prosecutions and Garnishee Proceedings. No. 20.—B.C.H.I.S. MANAGEMENT BOARD AND SELECT STANDING COMMITTEE The Board received many recommendations in connection with the administration of B.C.H.I.S. A few representative suggestions are quoted herewith:— From the North Sidney Property Owners' Association.—A permanent Extra-Governmental Board should be created to administer the B.C.H.I. Act on a basis similar to the Board administering the Workmen's Compensation Act. From the Halls' Prairie Farmers' Institute.—We are strongly in favour of the provincial Hospital Commission to take entire charge of the carrying out of the Hospital Act free of all or any political control; this Commission to consist of five persons, as follows: One appointed by the Government; One appointed by the Medical Profession; One appointed by Agriculture; One appointed by Labour; and One appointed by Industry. This Commission will be entirely responsible for the carrying out of the Act, to suggest changes in the Act, and in every way endeavour to see that a compulsory hospital system for the Province is made to be fair, just, and equal to all the people. We consider that hospitalization for the people is altogether too important, from the public standpoint, to be made a political football. From the Standard Railway Labour Joint Legislative Committee for British Columbia.— This Joint Committee has always opposed the principle of one-man commissions. We believe it borders too close to a dictatorial system for our Canadian mode of life. Therefore, however conscientiously the appointee may conduct his duties, he can never hope to obtain the confidence of a majority of the people he is sworn to serve. This being so, the purpose of his office is frustrated from the beginning. We sincerely believe that much of the spontaneous and contentious opposition to the present Act and interpretations of its administrator would have been avoided by a commission of at least three members. These, we suggest, should represent a fair blend of constituents, and include one holding the full confidence of labour. This commission should, we think, apply a more mature, comprehensive understanding of the problems of the people who have been obliged by law to provide the premiums for this insurance service.. It should also, by prompt hearing and dealing sympathetically with complaints, relieve much of the deplorable doubt and distrust that has unfortunately invaded this very important public service. From Mr. G. H. Jackson, Secretary-Treasurer of the Canadian Pacific Railway Employees' Medical Association of British Columbia.—The present Hospital Insurance Inquiry Board form a Standing Committee of the Legislature with supervision over the operations of hospital insurance in all its phases. That it meet at intervals of not more than three months throughout each year, at least until operations are proceeding on a smooth and sound basis. With the experience gained in the course of their enquiry the members of the board would be admirably suited to compose this Standing Committee representing, as they do, both the Government and His Majesty's Loyal Opposition. Mr. Jackson, who appeared before the Board on more than one occasion, has verbally stated that he is decidedly in favour of a board of management to consist of FF 36 BRITISH COLUMBIA three laymen, who should hire the necessary experts; but there should be no attempt to make the commission consist of one hospital administrator, one doctor, and one businessman. He definitely thought the board of three would be very desirable because, however good the individual might be, the public has no confidence in the rule of one man. The Board therefore recommends that B.C.H.I.S. be administered by a board of three members, without legislative or judicial powers, and also that Standing Orders of the Legislature be amended to provide for the appointment of a Select Standing Committee on Hospital Insurance, which shall meet at each regular session of the Legislature and shall review the report of the B.C.H.I.S., meet with the board of management, and report to the Legislature. No. 21.—HOSPITAL ADVISORY COUNCIL A Hospital Advisory Council was appointed when B.C.H.I.S. was first organized. It was reconstituted in March, 1950, and its first meeting was held in September of that year. We have been advised by the Commissioner that since 1950 regular meetings of the Hospital Advisory Council have been held at least every three months. The Commissioner conveyed to the Board that he was well satisfied with the services rendered by the Hospital Advisory Council. On the other hand, several organizations which are actually represented on the Hospital Advisory Council believed that their representatives could have been of greater service if the fullest advantage had been taken of their desires in this regard, and other organizations which did not have representation on the Hospital Advisory Council believed that they could also have rendered valuable assistance. The opinions of these organizations are set out as follows:— From the Vancouver Board of Trade.—It was inevitable that under its present set-up B.C.H.I.S. would disturb the former relationship of doctor, hospital, patient and community. A satisfactory and equitable realignment of the spheres of operation and responsibility, where inter-dependence is as apparent, demands mutual consultation and co-operation. More effective utilization of the Provincial Hospital Advisory Council on policies and issues could have aided the Government in its decisions. The Provincial Hospital Advisory Council should become a more effective agent, and it should meet frequently and have opportunity to determine and indicate policy rather than be called together to concur in fait accompli and to approve departmental decisions. The Hospital Insurance Act should be amended accordingly. From Royal Jubilee Hospital.—Section 23 of the Hospital Insurance Act requires that there be an Advisory Council to advise the Minister in regard to hospital insurance matters. This Council has seldom been used in an advisory capacity and does not contain a hospital administrator so that it rather serves as a sounding board than an advisory council. From the Late Dr. T. W. Sutherland, Parksville.—When your commission was in Nanaimo, you told me of your informal meeting with the executive of the B.C. Medical Association. In the event that an Advisory Council to the B.C.H.I.S. be set up, the medical representative should not be a political appointee but rather one who had the confidence and support of the Medical Association. To that end, I would suggest that the Medical Association be asked to nominate three men and that the Government appoint one of these three. The same would apply to the B.C. Hospitals' Association, labor organizations, etc. The Board therefore now recommends:— (a) That the broad intention behind the setting-up of the Hospital Advisory Council be fully realized, and that if full advantage is not now being taken of the services of the Council, steps be taken to realize the maximum benefit therefrom; and that, further, all proposed important changes in policy or regulations be discussed with the said Advisory Council before the proposed changes are put into effect: (b) That the Hospital Advisory Council shall in future include in its membership two private members of the Provincial Legislature, to be appointed or named before each regular session of the Legislature is prorogued, and that the said private members shall be selected from the membership of the Select Standing Committee which has been in existence REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 37 during the said regular session, one to represent the Government and one to represent the Official Opposition. No. 22.—PUBLIC RELATIONS OF THE SERVICE In view of the prominence with which the matter of the public relations of B.C.H.I.S. was brought before this Board, the Board has attempted to consider each and all of the activities of the Service that would be properly classified under this heading, and which in any way influence public opinion of the Service. These activities include many features, ranging from newspaper releases and advertisements down to the style of letters that go to the general public in the ordinary way from the offices of the Administration. The evidence was that the large spaces used in newspaper advertisements, and frequently the type of matter contained therein, gave to the general public impressions of waste and extravagance, and attempts to force the insurance scheme on the public without at the same time seeking to improve the Service. Similarly, representations were made to the Board in all parts of the Province as to the tactless and dictatorial tone of letters received from Victoria. Not only were the letters referred to considered to be offensive, but there was constant complaint of the delay in receiving replies of any nature from Victoria—and statements that in many cases letters sent there had been completely ignored. There was, in addition to the above, a great deal of complaint made to the Board with respect to the general make-up of, and the wording used on, premium notices. Many of these notices sent out in the past were, in the opinion of the Board, very difficult for a large percentage of the people concerned to understand, and it is certainly very annoying to the average person to have to seek out someone of superior intelligence in order to obtain an expert interpretation of something that should have been plain and straightforward in the first place. This matter, alone, has not made for good public relations with the ordinary registrant and premium-payer. B.C.H.I.S. is " big business" and, when functioning properly, will be dealing with nearly every citizen of the Province. Its success depends on public acceptance, not on the ability of the Government or the Administration to make people like it. Therefore, the Board wishes to point out that supervision of public relations is a highly specialized occupation. Volumes have been written on the subject, and intensive training courses have been developed to fit people to engage in the important role of public-relations officers. The proper preparation and presentation of matter to be included in press statements, public addresses, advertisements, or even in the make-up of letters dealing with commonplace matters is something that makes the most vital difference to any organization in its relations with its customers or the general public. We feel that B.C.H.I.S. needs public-relations guidance, which would help sell hospital insurance service to the public—and this is not to be confused with the mere handing-out of publicity. We feel that B.C.H.I.S. needs a public-relations officer, responsible directly to the Minister, if the present administration system is to be followed—or responsible directly to a board, if the B.C.H.I.S. is to be administered by a board. His duties would be many: they would include visiting every hospital in the Province regularly, contacts with the public generally, attendance at public meetings, and every activity which would acquaint him with the opinions of the population of the Province as to the workings of B.C.H.I.S. We are sure that when visiting hospitals such an officer would learn of many situations where a simple decision to be made in Victoria could wipe out much resentment, providing the said decisions were made promptly. It would therefore be the duty of the public-relations officer to find the things which are the subject of public concern and then urge the Administration to attempt quickly to correct the source of dissatisfaction. We are not suggesting that the public-relations officer is merely an official to receive FF 38 BRITISH COLUMBIA complaints and pass them on. We do think, however, that he would hear complaints at times, and he could get the difficulties smoothed over before the complainants were so concerned as to take their cases to the public press. Furthermore, a public-relations officer should be fully acquainted with the decisions of the Administration, and he should know of these decisions well in advance of the time they will be announced to the general public. He can then prepare the way for the announcement, by setting out what particular difficulties have faced the Administration in certain respects, and seek to guide public opinion toward the favourable acceptance of the decisions to be announced. The public-relations officer also should be the contact with the press, and should have authority from the Administration to get and to hand out, where he believes it to be good business to do so, details which the newspapers want—and he should have authority to go directly to the sub-department to get his information. Another field of public relations to which we might allude is the work of the field representatives of B.C.H.I.S. throughout the Province, but we have dealt with this particular matter in another recommendation. The Board therefore recommends that, as it is their opinion that the scope of the public relations of the B.C.H.I.S. justifies the retention of a Director of Public Relations of outstanding ability, steps be taken to secure the services of such a person, and that responsibility for the public relations of the Service be placed in his hands as soon as possible. No. 23.—FIELD REPRESENTATIVES OF B.C.H.I.S. During the first year that B.C.H.I.S. functioned, a chain of offices was opened up throughout the Province. At one time these offices totalled sixty-two. Suitable persons were in charge of these offices, to look after collections and serve as sources of information in connection with the Service generally. For various reasons, which the Board is not in a position to question at this time, this system of district offices was changed, with the result that the staff was substantially reduced and the majority of the offices were closed. There is no question but that a valuable service was rendered by this system of district offices, but it is questionable whether they justified their cost. However, their discontinuance was sorely felt by citizens in localities where they were closed, and there has been a very strong appeal made by such districts for the reopening of district offices. The ultimate solution to this problem depends upon whether or not the recommendation of this Board, numbered 30, is adopted and put into effect. Under subsection (iii) of section (c) of the plan contemplated by this recommendation—" Provisions for Payment of Premiums "—it is suggested that premium and arrears payments are to be accepted through various collection agents. Adoption of this portion of the Board's recommendation would permit payments of premiums and issuance of interim receipts at many places, such as branches of chartered banks, express money-order offices, Government Agents, and any and all other places that would make it easy and convenient for persons to pay premiums. This would result in a broader service than has ever been available with respect to payment of premiums, so that the need for district offices would be somewhat relieved. We do, however, feel that there is a need for a field force of what might be called " trouble-shooters." This field force should be composed of carefully selected personnel, properly trained to adjust problems of various kinds. These fieldmen would not necessarily have to work out of local offices, provided there was some place, such as a Government Agent's office, to use as headquarters. The Board learned that much dissatisfaction existed throughout the Province with respect to matters that are presently handled by correspondence from Victoria, and it believes that many problems at present dealt with by correspondence could be referred to the fieldmen for personal contact and adjustment. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 39 Particular stress has been laid in another section of these recommendations on the matter of public relations. This field force could be made a most important factor in the field of public relations by handling problems of premium-payers with dispatch and better understanding. The number of persons to be employed in this particular work is a matter for very careful study, and it is suggested that the force should be adequate but not excessive. The Board therefore recommends that the present force of district representatives be enlarged to an extent necessary for them to take care of problems as outlined herein without undue delay; and, further, that the personnel of this field force be given proper training to fit them to act as " top-notch " public-relations officers. No. 24.—EXEMPTED AREAS Subsection 1 of section 11 of " Hospital Insurance Act" Regulations (revised to April 10th, 1951) reads as follows:— The following persons shall be entitled to claim exemption pursuant to clause (/) of subsection (1) of section 8 of the Act:— (a) Residents of the Atlin Electoral District: (b) Persons residing north of the 55th parallel in the Omineca Electoral District, with the exception of Manson Creek: (c) Persons residing north of the 55th parallel in the Fort George Electoral District: (d) Persons residing north of the 58th parallel in the Peace River Electoral District. The areas set out in the above subsection are sparsely populated, and administration would be very difficult, and the likelihood of the people benefiting is not great. However, in accordance with the above regulations, unless they claim exemption they are offenders under the B.C.H.I. Act and Regulations. We feel that residents of these remote northern areas should be extended the privilege of becoming registered under B.C.H.I.S. voluntarily instead of being subject to the regulations by which they must apply for exemption. The Board therefore recommends that the necessary amendments be enacted to exempt all persons in the areas referred to, but that the privilege of voluntary registration and participation under the " Hospital Insurance Act" be extended to them. No. 25.—ANNUAL ACCOUNTS OF B.C.H.I.S. We now refer to the matter of annual accounts of B.C.H.I.S. It has so far been found necessary for the Service to keep two sets of accounts—one for the calendar year because of the fact that the operations of the Service commenced on January 1st, 1949, and the added fact that the hospitals of the Province operate on a calendar-year basis, and another set for the fiscal year ended March 31st, in order to coincide with the accounting system of the Provincial Government. It is obvious that, as a result of these two necessities, the accounts of the Service published so far cannot be said to be truly and properly prepared on a revenue basis for either period. Reference to the First Annual Report of the Service for the year 1949 shows that the accounts for that particular year were (subject to certain estimated figures) prepared on a correct revenue basis, but when we turn to the Second Annual Report of the Service, January 1st to December 31st, 1950, we find that the procedure adopted for the calendar year 1949 has been abandoned, and the published financial statement is simply a statement of cash receipts and disbursements of the fiscal year ended March 31st, 1950. The Board has not yet obtained any published statement for any further period, and it may be presumed that the next statement to appear will be similar to the Second Annual Report and will carry only the receipts and payments to March 31st, 1951. In the opinion of the Board, this form of statement gives entirely insufficient information to the Legislature or to the people of the Province. Furthermore, when the FF 40 BRITISH COLUMBIA statement is placed before the Legislature, the information which is contained therein is already a year old, although the results of the operations of the Service for the year which is ended at a much later date are already on record at the headquarters of B.C.H.I.S. When visiting Regina to review the Saskatchewan Hospital Services Plan, the Board learned that the complete accounts of the Plan for the previous calendar year were placed before the Legislature before the end of the following February and were printed and in circulation prior to May 31st following. Another point having a bearing on this matter was the complaint of several hospitals that they were unable to obtain, until it was too late to be of any use, information concerning the operations of comparable hospitals which they felt might enable them to correct their own shortcomings and thereby benefit the Service in general. In view of the impossibility of divorcing the operations of the Service from the operations of the hospitals of the Province, it would seem desirable that the Service should continue with the practice adopted in the first year of its operations, preparing accounts on a proper revenue and expenditure basis for the calendar year, thus enabling the closest check of the accounts of the hospitals of the Province and also enabling a publication of the detailed income and cost figures of the Service within a reasonable lapse of time after the close of the period to which they refer. The Board therefore recommends that it seems highly desirable to have the annual accounts of B.C.H.I.S. prepared on a revenue and expenditure basis for each full year of its operation, rather than on a cash receipts and payments basis running to March 31st only, and that publication thereof should be made as early as possible in a manner clearly understandable to the general public. No. 26.—PREMIUM-YEAR A suggestion worthy of consideration regarding the commencement date of the premium-year was made to the Board. The matter of changing the fiscal year to coincide with the calendar year and thus place the accounts of the Service on a more desirable basis has already been dealt with in another recommendation. After careful consideration, the Board decided that the premium-year does not necessarily have to be the same as the fiscal year of the Service, and it was pointed out to the Board that many premium-payers would find it easier to meet their obligations at some other times than the year-end and the month of June. The arguments advanced in support of this point of view include the suggestion that the month prior to January 1st is a spending season, when the resources of the average person are thereby seriously depleted; that this period is also a period of seasonable unemployment; and, further, that as a general rule tax payments become due in the months of May and June, and that they, also, cause a considerable strain on the financial resources of the average person. It was also pointed out that if the premium-year started on April 1st and ended March 31st, the extra work involved in the receipt of premiums in great numbers at one time would not impose as great a problem on B.C.H.I.S. as if this work was imposed on the Service at the end of the calendar year, along with all the other extra work related to the year-end activities. The Board therefore recommends that, as soon as can effectively be done, the premium-year be from April 1st to March 31st. No. 27.—"CHRONIC" DIAGNOSIS: PROVISIONS FOR REVIEW A very important matter, which has caused a tremendous amount of distress and dispute to an increasing degree during the last eighteen months, is the system in force (and the manner in which rulings are made by the B.C.H.I.S. Administration) regarding illnesses classed as " chronic," which has the effect of curtailing the liability of the --./.::-:■ ,: % REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 41 Service for the hospital account. The viewpoint of many hospitals on this matter was forcibly expressed, and the Board also obtained the opinions of various other organizations of repute. In addition, the Board was faced with much evidence of cases of distressing hardship from the individual point of view. It may safely be said that no other phase of the Board inquiry has produced, to such an extent, evidence of existing circumstances meriting the most careful and considerate attention of all interested authorities from a humanitarian point of view. We first quote the opinion of the spokesman for the medical profession—the College of Physicians and Surgeons:— It is recognized by the doctors that B.C.H.I.S. was not set up to provide chronic hospital care and that controls in this respect are a " necessary evil." We object strongly, on behalf of our patients, to the method for control that has been set up in Victoria to handle this problem. Certain categories of patients, in particular, may be placed in distressing circumstances when present methods are followed. These categories include patients with advanced cancer, patients with severe acute forms of non-pulmonary tuberculosis, mental patients above the age of seventy, and patients with certain conditions of long duration that may require very special hospital care, notably poliomyelitis and paraplegia. // rs intolerable to us that an arbitrary ruling can be made by a single medical civil servant in Victoria indicating that certain individuals in any of the above-mentoned groups, whom he has not seen and whose doctors assert are still requiring acute medical and hospital care, are now eligible for two more weeks or four more weeks or no more care at all under B.C.H.I.S. It has been apparent to us that the doctor on the staff of B.C.H.I.S. in Victoria is in no position to determine the eligibility of individual patients for insurance coverage in these difficult and controversial problem cases. Decision in these matters should be made at a local level by a competent medical man or committee of medical men and should be based on the findings in each case. It will be impossible to find doctors to act in these capacities until more adequate services are made available for the care of convalescent and chronic disease outside of the acute general hospital. No doctor in practice will condone or be party to the discharge of a patient from an acute general hospital if that discharge means gross deterioration of the standard of medical care. That, in fact, is what we are being asked to do now by B.C.H.I.S. on not infrequent occasions. Apart from consideration of patients who are sidetracked away from acute hospital, we feel that the number of patients whose coverage is terminated before their doctor considers that they are fit for discharge, though it is a small number, is significant. It is just these cases of catastrophic hospital expense that led the majority of citizens to accept hospital insurance as a good measure. We have been told, in respect to these cases, that the Hospital Insurance Service does not state that a patient should be turned out of hospital. That is true, but when a citizen of limited means is told that if he or his dependent remains in hospital he must pay eight or ten or thirteen dollars a day, the practical result is the same. Furthermore, there will be immediate and very strong pressure from the hospital to move that patient out because the hospital does not want to be stuck with the bill if that citizen defaults. The point of view of many hospitals is reflected in the quotations given below from their respective written submissions to the Board:— Powell River General Hospital.—The Board of Management are not in agreement with the present method of a staff in Victoria determining the need for hospitalization. This method incurs an unnecessary amount of paper work and nuisance to a co-operative medical staff. The Board of Management wishes to recommend that the decision as to whether or not a patient is in need of acute care in a general hospital be left to the discretion of the local hospital authority. Penticton Hospital.—We feel that the determination of chronic from acute cases can be made only at the attendant medical level. A committee of doctors from the medical staff in all hospitals should be appointed and authorized to rule on all cases in hospital over fourteen days. At that time, the patient can be advised of his limited stay in hospital under hospital insurance, and the many just criticisms of diagnostic practice by remote control eliminated. We are well pleased with the general principles of the plan, but feel that some remedy must be found in order that the humanitarian basis on which it was founded is not lost in the monetary approach. And from other organizations we select the following written submissions on this point:— Vancouver Board of Trade.—Efforts now being made by B.C.H.I.S. to expedite classification of chronic and acute illnesses should be pursued in order to eliminate the delays which have been annoying, costly, and onerous to patients and hospitals alike. In large urban centres, such as Vancouver, the appointment of a small panel of doctors or an Admission and Discharge Officer by the respective hospitals to rule on such cases after interview of patient, doctor, and hospital FF 42 BRITISH COLUMBIA officials would, it is believed, serve a necessary and useful function. The decisions and recommendations of Admittance and Discharge Officers would, in turn, be reviewed by a department official. Rulings of a single official at Victoria, based on incomplete information, would thus be avoided. Some hospitals have set up voluntary panels which are proving effective in the expeditious handling of admittances and discharges. The Vancouver Board of Trade therefore recommends that it be made obligatory on each hospital to appoint an Admission and Discharge panel or officer to deal with classification of chronic and acute illnesses. Imperial Veterans' Action Committee in Canada.—We understand that as at present the B.C.H.I.S. reserve to themselves the right to decide when a case is chronic and when not chronic. Furthermore, we understand that the Service may decide that a case is chronic after a person is out of hospital, or after even receiving treatment on several different occasions, and then decide to bill the patient. We object to to laymen deciding when a case is chronic, which we contend should be a matter purely for a doctor to decide. We also feel that a clear definition should be given as to the stage at which a case is declared chronic. Mr. G. H. Jackson, Secretary-Treasurer, Canadian Pacific Railway Employees' Medical Association of British Columbia.—Next comes the question of what might be termed " long-stay cases." Under the Regulations of B.C.H.I.S., patients are entitled to in-patient hospital care for " acute " conditions only and coverage is terminated when active hospital treatment is no longer necessary. This sounds perfect in theory; but in its application it is quite a different matter. There is only one person competent to decide when a patient's condition is or ceases to be acute and that is the attending doctor. It is absurd to assume that a medical referee sitting in an office in Victoria can decide when an acute condition does not exist. The practice is unethical and is unfair to the patient, the hospitals and the medical profession. To promise " unlimited " coverage and then cut it off arbitrarily, or as has been done in some cases, say that coverage will not be continued beyond a pre-determined date, set by the medical referee, who has not seen the patient, is frankly dishonest. With regard to a particular class of patient, the following from a brief of the British Columbia Polio Fund is very noteworthy:— Today, polio treatment is a concern in at least 45 communities throughout the province and the recent action of the B.C. Hospital Insurance Scheme has given grave concern to all these people. In a recent ruling of the authorities of the B.C. Hospital Insurance, polio patients have been placed on a two-weeks basis for their hospitalization. For those who know the facts, this is a shocking situation and one that shows that those who made such a decision have a complete lack of knowledge of the medical facts concerning polio and, in addition, no conception of the economic implications of such a decision as it affects everyone concerned, except the immediate saving of money for the insurance scheme. It shows no regard whatever for the long-range thinking that is necessary when one is dealing with a disease such as polio and seems to demonstrate that these people (B.C. Hospital Insurance) are taking any means whatever (as in this case the placing of these victims in a position to possibly face a life of invalidism) to cover up the more serious and basic errors of judgment and planning. In appealing for these victims now, we feel that we may be speaking for other diseases later because, if no change is made, other diseases that require any length of hospitalization whatever will no doubt be treated in like manner. Polio is a disease that strikes suddenly and, in many cases, with dramatic consequences and frequently tragic results for the victim. To put it very bluntly, without the long, painful, tiresome rehabilitation process now available, a good many victims of polio would have been better off to die at the very outset of the disease. It is quite true that the infectious stage of the disease is quite short, usually about two weeks, and if that is what is considered the end of hospitalization by the authorities of the B.C.H.I.S., then they are labouring under very grave and serious misconceptions. By definition, and this is a definition set out by the B.C. Hospital Insurance Scheme in recent newspaper advertising, a disease is said to have reached the chronic stage when the patient has reached the position where they can be adequately cared for in some other place than the hospital, thus ending the need for hospital care automatically, according to the B.C.H.I.S.'s way of thinking. The victims of polio have at the end of two weeks just passed the infectious period and to apply the definition of the B.C. Hospital Insurance at this stage of treatment is, to say the least, almost ridiculous. Polio patients with any residual paralysis whatever can and do receive benefits from hospitalization for as long as two years and the help they receive can be given at no other place or in no other way than in the hospital. To be specific, for example, Miss Violet Tennant has been in the Vancouver General Hospital from January 1947 to the present time. She shows continuous improvement but could not possibly be cared for outside the hospital. Under present hospital insurance rulings, if this should happen to you, it would cost you approximately $22,400. It should be pointed out that at least 90% of the citizens in B.C. could be considered indigenous REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 43 as regards polio. The bare necessities of hospital treatment amount to $405.00 per month. If these people cannot be protected under B.C.H.I.S., then there is no insurance. So to say that a polio case has reached pernicity at the end of two weeks is not supported by any facts whatever. In view of the foregoing facts, we ask this commission to intervene on behalf of the polio victims of this province. We are asking that the recent arbitrary ruling of two weeks' hospitalization be changed to a no limit period subject only to recommendations as to time limit of the hospitalization period by a proper and competent medical authority. We wish to emphasize the fact that the above represent only a portion of the written submissions made by organizations in connection with this subject, and that these and the other written submissions to the Board were reiterated and confirmed in a most forcible manner from many sources by verbal testimony given to the Board. The Board has reason to believe that there has been recently a gradual development of a procedure by which there is more co-operation between local medical authorities and the B.C.H.I.S. Administration—and that there is a definite trend to improvement of the situation that had arisen. However, the Board does not think that all causes for dissatisfaction have been removed, and believes that a carefully studied and definite plan must be laid down for early adoption to govern future action and procedure. The Board therefore recommends that:— (1) Where it is decided that a patient in an acute or general hospital is ruled to be, or to have become, a chronic case, and not the responsibility of B.C.H.I.S., advance notice of the discontinuance of benefits shall be giyen in every case; and the effect of such ruling shall in no case be retroactive: (2) Before such ruling is made, any and all cases should be referred, wherever possible, to the medical staff of the hospital, whose opinion shall be fully considered by the medical consultant or administration of B.C.H.I.S.: (3) In all cases of difference or dispute arising at any point as to the correctness of the diagnostic decision, the final decision should be left to a Medical Review Board, consisting of two representatives of B.C.H.I.S. and three doctors appointed by the College of Physicians and Surgeons: (4) Provision be made for the appointment of the said Medical Review Board as soon as possible. No. 28.—PROVISION FOR PERMISSIVE USE OF SPECIAL DRUGS During the course of its inquiries, the Board heard of many cases of severe and even tragic hardship arising out of the regulations by which the use of certain costly drugs is not included as a benefit under B.C.H.I.S. The Vancouver General Hospital has this to say in their written submission to the Board in general connection with this subject:— Another problem involves an apparent lack of co-ordination between the B.C. Hospital Insurance Service and competent medical authorities. Rulings, regarding which drugs and pharmaceuticals may be included as operating expenses, sometimes appear to be based on a dollar value rather than on medical necessity. Rulings, as to which type of case is not covered by the B.C. Hospital Insurance Service, do not always appear to have sound medical reasons as their basis. One example is the present ruling on the use of ACTH and Cortisone. When these drugs first appeared on the market, it was reasonable to assume that definite restrictions regarding their use were required. However, there has now been sufficient research and experience connected with these drugs to permit their use under certain definite conditions, but there is no prescribed method in which application for use of these drugs may be made. To establish arbitrary rules that certain treatments or conditions will be excluded is not always reasonable or fair to the patient. Decisions should be made locally by competent medical men, based on the findings of individual cases. In many hospitals there are competent medical boards which would certainly be qualified to advise on these matters and supervise the limited use of certain specific drugs and treatments. FF 44 BRITISH COLUMBIA Recommendation: That an active means of co-operation between the B.C. Hospital Insurance Service and competent medical authorities be instituted for the purpose of deciding which drugs and treatments may be included in the hospitals' operations. More than one case has been drawn to the attention of the Board where a patient has been in distressing need of the said drugs, even to the point where the only chance of saving the patient's life is afforded by the use of the drugs. In addition to this comes evidence that the patient and his responsible relatives have exhausted their entire means in honest and praiseworthy efforts to ensure the utmost in medical treatment, sometimes over prolonged periods—and they now have absolutely no material resources or credit left by which they can, themselves, secure the vitally needed treatment or drugs. The Board feels it futile to try to set down in writing the many humanitarian factors that enter into the consideration of cases of this nature. The Board has, however, elsewhere suggested the setting-up of a Medical Board of Review to work with, or for, the B.C.H.I.S., and in the hope and expectation that this recommendation will be duly implemented— The Board therefore recommends that the Medical Board of Review, if established, shall have the authority to allow the use of special drugs for hospital patients, when vitally necessary, on the recommendation of the local medical authority. No. 29.—PREMIUM-PAYMENT ENFORCEMENT: PROSECUTIONS AND GARNISHEE PROCEEDINGS The Board notes that sub-section (2) of section 11 of the " Hospital Insurance Act " provides that any person who, on summary conviction, is found to be guilty of an offence against the Act by reason of non-payment of premiums, in addition to being fined " shall be ordered by the Magistrate or Justice to pay the amount of the premium that is owing, including any arrears, etc., etc." It has been drawn to the attention of the Board that, in a substantial number of prosecutions initiated by B.C.H.I.S. against non-premium-payers, the judgment of the Court has imposed a fine plus Court costs but has not included an order for payment of arrears in accordance with the section of the Act quoted above. There is also another matter having to do with the enforcement of payment of premiums. Section 11b of the Act provides that the Commissioner, or any person authorized by him, may require the employer to pay the premium owing by the employee—and pay the same to the Commissioner on account of the premium owing by the employee. It would appear that this procedure of simple garnishee has not been used to the fullest extent, and it would also seem that the procedure of automatic garnishee might be extended to be effective against any sums owing to a delinquent person, whether by an employer or any other person. The Board therefore recommends:— (a) That the competent authority shall call to the attention of the Magistrates and Justices of the Province the provisions of subsection (2) of section 11 of the Act as referred to above, and shall require their future compliance therewith: (b) That the Administration of B.C.H.I.S. shall take full advantage of the provisions of section 11b of the Act when such action is justified by circumstances: (c) That the application of section 11b shall be widened so as to permit the procedure of automatic garnishee by the Administration of B.C.H.I.S of any sums owing to a delinquent registrant (or person required to be a registrant under the " Hospital Insurance Act "), provided that such extension is ruled by competent authority to be possible. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 45 SECTION 4.—B.C.H.I.S. ADMINISTRATION 30. Plan of Registration and Premium Collection. 31. Proof of Standing under the Act. (To be required from applicants for any Provincial (annual) licence.) 32. Limit of Liability for Premium Arrears. 33. Collection of Arrears of Premiums. 34. Exemption Cards: Issue to Certain Persons and Charge Therefor. 35. Changes of Status. 36. Elimination of Certain " Group " Records. 37. Pamphlet Covering Plan and Benefits. No. 30.—PLAN OF REGISTRATION AND PREMIUM COLLECTION One of the major matters commanding the attention of the Board has been the overall method of collecting premiums and issuing proper identification certificates. Our Business Management Consultants, Messrs. Stevenson and Kellogg Limited, have devoted a great deal of attention to this particular phase of the operation of B.C.H.I.S. The Board gave due consideration to the relationship between suggested methods and the personnel and general expense required to operate on the basis of the various suggestions. We think it would be useful at this point to interject the remarks made in the written submission of Mr. G. H. Jackson, secretary-treasurer of the Canadian Pacific Employees' Medical Association of British Columbia, as follows:— It would seem to be evident that the present arrangement of a combination of payroll deductions and direct payment cyclic billing is not the solution. Insofar as the Hospitals are concerned it is far from satisfactory. Hospitals should be assured that everyone who is registered with B.C.H.I.S. has coverage. All contributors should be eligible for benefits as soon as they have registered. From an employer's standpoint payroll deductions are not entirely satisfactory, particularly where transients are involved. If some improved system of collection could be put into effect on January 1st, 1952, it would be the best indication that the Government intends to place B.C.H.I.S. on a business-like basis. After many discussions with Messrs. Stevenson and Kellogg Limited, they submitted to the Board the following plan as being their suggestion for obtaining the maximum efficiency at the minimum cost:— (Note.—The plan immediately following is referred to in the recommendation at the end of this section as " Plan No. 1.") (a) That an annual premium is to apply for each calendar year, with the provision that half-yearly partial payments may be accepted. (b) Individuals will be responsible for payment of their premiums before the premium due date. No bills are to be sent by B.C.H.I.S. but a Notice of Premium Due will be sent to all registrants at their last-known address. (c) Provisions for payment of premiums will include:— (i) Allowance for payment of at least one-half the total annual premium semi-annually prior to January 1st and/or July 1st. (ii) Premium-year (calendar year January 1st to December 31st) is to be distinguished from benefit period, which will be: First half, January 1st to June 30th; second half, July 1st to December 31st. (iii) Both premium and arrear payments are to be accepted through authorized collection agents. (iv) Premium payments for less than the full amount of the annual premium must be made before January 1st or July 1st and must be for a full six months' period. No partial payments are to be permitted except as in subsection (/). FF 46 BRITISH COLUMBIA (d) Individuals will be eligible for hospitalization benefits if payment for the current half-yearly benefit period has been made. Seven days' grace will be allowed to late premium-payers, providing they were in benefit during the previous benefit period. A fourteen-day waiting period is to apply to new registrants, those who were not in benefit during the previous benefit period, or those previously in benefit who have not paid the premium for the current benefit period before the expiry of the period of seven days of grace allowed after the date of premium payment. (e) Arrears will apply as follows:— (i) If premium has been paid for the first half-year's benefit period (January 1st to June 30th), arrears, if any, will be for the immediately preceding calendar year (January 1st to December 31st), unless the registrant is actually liable for less than that amount according to the Act and basic records. (ii) If premium has been paid for the second half-year's benefit period (July 1st to December 31st), arrears, if any, will be the total of the premium payable for the eighteen months immediately preceding July 1st (January 1st of the preceding year to June 30th of the current year), unless the registrant is actually liable for less than that amount according to the Act and basic records. (iii) If a person has paid premiums for the current benefit period, he will be eligible after the fourteen days' waiting period for hospitalization benefits despite owing arrears. The collection of arrears will be the responsibility of a separate section of B.C.H.I.S., whose responsibility will be to collect and arrange for the collection of arrears, using the various devices and powers allowed by law. (/) Premium payments may be made direct to B.C.H.I.S. offices in Victoria or to any authorized collection agent. (g) Certified interim receipts will be issued by all authorized collection agents for all premium payments made to them.. Official eligibility certificates will be issued by B.C.H.I.S. for all payments made direct to their offices and against all certified interim receipts received from the authorized collection agents. (h) The employers will be responsible for seeing that all new employees are in benefit. If the new employee is not in benefit the employer will arrange to have him placed in benefit at the time of employment. The employer will also be responsible for checking all his employees at stated intervals to ensure that they are all in benefit. Arrangements must be made to immediately place in benefit any employees who may be found to be out of benefit. (0 Identity cards will be issued to all dependents upon request only. However, the B.C.H.I.S. may arrange for authorized agents or secretaries of any exempted groups to issue identity cards to all exempted persons in their groups, sending duplicates to B.C.H.I.S. for their records. (/') There shall be no interference, implied or actual, with the right of employers and employees to jointly arrange for monthly or other periodical deduction by the employer of such sums as will amount in due course to the total premium payable by the employee at the commencement of every six months' period. The employer shall under these circumstances either:— (i) Remit the total amount of the periodical deductions to B.C.H.I.S. in trust for the employee; or REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 47 (ii) Deposit the sums in a special account in trust for the employees and cause the total thereof to be transmitted to B.C.H.I.S. prior to the commencement of the next six months' premium period. Irrespective of the manner in which the employer chooses to handle the deductions in agreement with his employees, it shall not be necessary for him to report to B.C.H.I.S. in detail the separate amounts deducted from each employee until the due date of the next six months' premium period. Continuance of the practice already in force between any employer and his employee on a purely voluntary basis is encouraged in every way. (k) In the case of persons entering the Province for temporary employment only and without intending to take up residence therein within the meaning of the " Hospital Insurance Act," it shall be permissible for an employer to engage such person or persons and the requirements as to deduction of an amount to cover the current hospital insurance premium shall be waived in the first instance—but nevertheless no such person shall continue to be employed for a longer period than two complete months without becoming thereafter immediately liable to the premium payment or deduction by the employer—and no employer shall waive such requirements in the first instance if he has knowledge that the said person has previously been employed in British Columbia (within the current six months) for a period of two months or longer. And, further, the employee shall sign a declaration that he has not previously been employed in the Province for an aggregate of two months within the current benefit period and setting out the periods of employment since he entered the Province. It will be seen that the consequence of the adoption of this plan would be that employers of labour within the Province could not give employment to any person not properly registered and in good standing under the " Hospital Insurance Act," and that this consequence would need to be enforced by the necessary enactments to make it legal and therefore effective. It may, however, be thought that such action is of too dictatorial a nature and not likely to be well received by the majority of the employed or the employers of the Province. Recognizing that the success of any law is dependent upon the measure of public acceptance of its requirements, the Board believes that the desired results might be attained by a somewhat different approach, though it is possible that this second approach would not be so fully effective and would also to some extent reduce the saving of cost to B.C.H.I.S. that is anticipated by this Plan No. I. The Board, therefore, sets out an alternative plan, as follows:— (Note.—The plan immediately following is referred to in the recommendation at the end of this section as "Plan No. 2.") (a) That an annual premium is to apply for each calendar year, with the provision that half-yearly partial payments may be accepted. (b) Individuls will be responsible for payment of their premiums before the premium due date. No bills are to be sent by B.C.H.I.S. but a Notice of Premium Due will be sent to all registrants at their last-known address. (c) Provisions for payment of premiums will include:— (i) Allowance for payment of at least one-half the total annual premium semi-annually prior to January 1st and/or July 1st. (ii) Premium-year (calendar year January 1st to December 31st) is to be distinguished from benefit periods, which will be: First half, January 1st to June 30th; second half, July 1st to December 31st. FF 48 BRITISH COLUMBIA (iii) Both premium and arrear payments are to be accepted through authorized collection agents. (iv) Premium payments for less than the full amount of the annual premium must be made before January 1st or July 1st and must be for a full six months' period. No partial payments are to be permitted except as in subsection (/'). (d) Individuals will be eligible for hospitalization benefits if payment for the current half-yearly benefit period has been made. Seven days' grace will be allowed to late premium-payers, providing they were in benefit during the previous benefit period. A fourteen-day waiting period is to apply to new registrants, those who were not in benefit during the previous benefit period, or those previously in benefit who have not paid the premium for the current benefit period before the expiry of the period of seven days of grace allowed after the due date of premium payment. (e) Arrears will apply as follows:— (i) If premium has been paid for the first half-year's benefit period (January 1st to June 30th), arrears, if any, will be for the immediately preceding calendar year (January 1st to December 31st), unless the registrant is actually liable for less than that amount according to the Act and basic records. (ii) If premium has been paid for the second half-year's benefit period (July 1st to December 31st), arrears, if any, will be the total of the premium payable for the eighteen months immediately preceding July 1st (January 1st of the preceding year to June 30th of the current year), unless the registrant is actually liable for less than that amount according to the Act and basic records. (iii) If a person has paid premiums for the current benefit period, he will be eligible after the fourteen days' waiting period for hospitalization benefits despite owing arrears. The collection of arrears will be the responsibility of a separate section of B.C.H.I.S., whose responsibility will be to collect and arrange for the collection of arrears, using the various devices and powers allowed by law. (/) Premium payments may be made direct to B.C.H.I.S. offices in Victoria or to any authorized collection agent. (g) Certified interim receipts will be issued by all authorized collection agents for all premium payments made to them. Official eligibility certificates will be issued by B.C.H.I.S. for all payments made direct to their offices and against all certified interim receipts received from the authorized collection agents. (h) Employers shall be required to ascertain that all new employees are duly registered and in benefit by requiring the production by them of their eligibility certificate before the first pay-day after the commencement of employment, and further required to check all employees at half-yearly intervals to ensure that they are all in benefit. In the event of failure on the part of a new or old employee to produce the necessary evidence of good standing to the employer, it shall be the duty of the said employer to forthwith report to B.C.H.I.S. in Victoria the names and last-known addresses of all such employees, together with their registration numbers, if any. The employer shall also be required to keep a proper record of all his employees, with their B.C.H.I.S. registration numbers, which records shall be open to examination by properly authorized officials at all times. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 49 (i) Identity cards will be issued to all dependents upon request only. However, the B.C.H.I.S. may arrange for authorized agents or secretaries of any exempted groups to issue identity cards to all exempted persons in their groups, sending duplicates to B.C.H.I.S. for their records. (/) There shall be no interference, implied or actual, with the right of employers and employees to jointly arrange for monthly or other periodical deduction by the employer of such sums as will amount in due course to the total premium payable by the employee at the commencement of every six months' period. The employer shall under these circumstances either:— (i) Remit the total amount of the periodical deductions to B.C.H.I.S. in trust for the employees; or (ii) Deposit the same in a special account in trust for the employees and cause the total thereof to be transmitted to B.C.H.I.S. prior to the commencement of the next six months' premium period. Irrespective of the manner in which the employer chooses to handle the deductions in agreement with his employees, it shall not be necessary for him to report to B.C.H.I.S. in detail the separate amounts deducted from each employee until the due date of the next six months' premium period. Continuance of the practice already in force as between any employer and his employee on a purely voluntary basis is encouraged in every way. (k) In the case of persons entering the Province for temporary employment only and without intending to take up residence in the Province within the meaning of the "Hospital Insurance Act," the employer will be required to ascertain the length of the said person's stay in the Province up to the time of commencement of (new) employment; but the employer will not be required to report the name and address of such employee to B.C.H.I.S. until he has knowledge that such employee has resided or been employed in the Province for a period of two complete months or over, in which case due notification shall be given by the employer to B.C.H.I.S. as required in section (h). (I) On receipt by B.C.H.I.S. of any and all such advices of non-registration or lapse of good standing the Administration shall forthwith take all necessary steps to secure the proper registration and payment of premiums by the non-registrants or delinquents. The Board therefore recommends that Plan No. 2 of registration of beneficiaries and premium collection as outlined above be adopted in its entirety at the earliest possible date, and that the necessary enactments be made to define the duties of the persons therein referred to and the proper penalties for failure to comply with the provisions thereof, and that the said plan be given a fair trial over a predetermined period, at the end of which period the position shall be reviewed, and if the response of the persons required by the Act to become registered and to pay premiums is not such as to have achieved the desired and intended results, then consideration shall be given to the necessity of introducing a plan such as the other plan referred to in this section. No. 31.—PROOF OF STANDING UNDER THE ACT (To be required from applicants for any Provincial (annual) licence.) Reverting to the basic matters of policy considered by the Board in the early stages of its investigation, it should be pointed out that having decided that B.C.H.I.S. must be continued in some form, it naturally follows that in order to be successful the plan FF 50 BRITISH COLUMBIA should register as nearly as possible 100 per cent of those who should pay premiums within the meaning of the Act. Past experience of the Hospital Service indicates that the methods used to register those who should be in the plan have failed to be 100 per cent effective and, at the same time, the same methods have proven very costly in that a large staff was required to operate the plan followed. The following observations are quoted from the brief of the Vancouver Board of Trade:— To ensure the successful operation of B.C.H.I.S. it is necessary that as many eligible residents of the Province as possible are registered under the scheme. To date reports indicate that in spite of legislation requiring compulsory registration there are an unduly large number of people who have not complied with the law. Not only lack of enforcement of the Act has contributed to the financial problems of B.C.H.I.S., but hospitalization of delinquents who have not paid their own hospital bills have jeopardized the financial standing of a number of hospitals. The Vancouver Board of Trade, therefore, declares that since it has been deemed necessary and desirable to have a government sponsored universal hospital insurance plan, it, therefore, follows there should be compulsory registration of all eligible B.C. residents and recommends that the government enforce the law requiring compulsory registration. And from the brief of the Vancouver General Hospital:— There are two main factors causing the increase in amount to be collected, one is co-insurance, and the other non-insured patients. While some of the non-insured patients are transients who cannot be expected to have insurance coverage, a good portion of the increase is due to residents whose insurance is not in good standing at the time of their admission to hospital. If the compulsory features of the Hospital Insurance Act, regarding registration and payment of premiums, were enforced, there is no doubt there would be a reduction in the amount we are required to collect from patients. Recommendation: That the compulsory factors of the Hospital Insurance Act, regarding registration and payment of premiums, be enforced in order to reduce the amount hospitals are required to collect from patients. Having in mind that full registration is essential and that the scheme is compulsory, it is pointed out that evaders are law-breakers. Furthermore, when a substantial percentage of those who should pay premiums are evading their responsibility, they throw an extra load on the law-abiding citizens who are registered and paying premiums. By the terms of the recommendation immediately preceding this one and entitled " Plan of Registration and Premium Collection," the Board believes that it has set forth procedures that may adequately cover the case of employed persons and render evasion of the plan for such persons virtually impossible. It would be unfair to this very large percentage of the population who are on the payrolls of the Province to take no steps to properly ensure the participation of self-employed or other people who are necessarily not covered by any payroll plan. There have, in the past, been evaders of the scheme in both classes. Having now dealt with the employed people, the Board considers that it must seek to ensure the same measure of co-operation and participation by the other section of the public. Such a step is only fair to the larger body of the population. Many suggestions have been advanced to the Board in this regard, but most of these have been found to be impractical and unworkable. Two alternative schemes have, however, been considered by the Board. The matter of public acceptance must be taken into account, as in the immediately preceding recommendation of the Board. We therefore present two alternative recommendations, believing that if the suggestion made in the first alternative is considered to be inadequate or is first tried without satisfactory results, the second alternative must eventually be resorted to. The Board therefore recommends:— (a) That the necessary legislation be enacted to require that any issuer of an annual licence on behalf of the Province of British Columbia shall, at the time of issuance thereof, ascertain the registration number or exemption certificate number of the licensee in all cases where such licensee is required to be covered by the " Hospital Insurance Act," and that if the said licence-issuer is unable to obtain the necessary evidence of standing REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 51 under the said Act, he shall thereupon forthwith report the name and address of the licensee concerned to the B.C.H.I.S., whose duty it shall be to ascertain that all such licensees are properly registered under the Act. It is also recommended that the Administration of B.C.H.I.S. shall seek the co-operation of issuers of municipal licences within the Province, with a view to having the same procedure followed by such officers. Or, alternatively— (b) That any person who is subject to registration under the " Hospital Insurance Act," when applying for the issuance of any annual Provincial licence within the Province of British Columbia, shall produce his official eligibility certificate, certified interim receipt (current period), or exemption certificate proving his good standing under the " Hospital Insurance Act" and regulations, and in default of the production of such evidence of good standing shall not be entitled to the issue to him of any such licence. No. 32.—LIMIT OF LIABILITY FOR PREMIUM ARREARS On the first day on which the Board commenced their investigations and studies, they were confronted with the problem of endeavouring to ascertain what percentage of the population of the Province required by law to be registered and covered by the " Hospital Insurance Act" was so registered and covered. Estimates of the said percentage were placed before the Board in every public and private hearing held. In addition, similar estimates appeared regularly in the public press, as news reports and editorial comments, and in the form of " Letters to the Editor." The minutes of the proceedings of the Board reveal opinions that the percentage of the population not covered under the Act ranges from 20 to 40 per cent; and it was not unusual in certain areas to have a figure of 50 per cent or even 60 per cent mentioned. These estimates, of course, conflicted with the figures put forward by the B.C.H.I.S. Administration, which purported to show that over 90 per cent of the population was properly covered. It will be obvious that the Board was in no position to arrive at an exact figure, or even to give definite support to any particular estimated figure. It may, however, be said that the Board became convinced, and remains convinced, that at least 20 per cent of the population referred to is either non-registered under the " Hospital Insurance Act" or has become and remains delinquent in the payment of the premiums called for by the Act and regulations. It need hardly be pointed out that this moderate calculation of the percentage of the population non-registered or delinquent reflects a very heavy loss of revenue to which the Service is entitled by law. In addition to this, there is undoubtedly a very serious demoralizing effect upon the registered and paying public, arising from their knowledge (or supposed knowledge) of the delinquency of a great number of their fellow-citizens. The opinion that persons complying with the law were " suckers " was very commonly held, often expressed to the Board, and appeared to be growing day by day. It was not unusual to have citizens report that they were positively aware that many of their neighbours had never registered under the " Hospital Insurance Act." Very reliable evidence was given that in numerous cases men who applied for, or were offered, employment by firms which had adopted the payroll-deduction system of B.C.H.I.S. either declined the employment offered or left the said employment as soon as they discovered that this would lead to their registration for the purposes of hospital insurance, and such persons frankly stated that they could go elsewhere without the slightest difficulty and obtain satisfactory employment which would leave them still unfettered and free as far as hospital insurance requirements were concerned. FF 52 BRITISH COLUMBIA In connection with both non-registrants and delinquents, it later became evident that the proportion of accounts incurred by these persons, or their dependents, in the hospitals of the Province was increasing, and that the refusal of the B.C.H.I.S. to accept liability for the said accounts was placing an undue burden upon the hospitals, about which they were most seriously concerned. There was the added factor that the exact standing of many of these people was not readily ascertainable, and in some cases the patient had left the hospital days or weeks before the hospital administration had ascertained their current standing—and the hospital administration was therefore deprived of the proper opportunity to collect (or endeavour to collect) the hospital account from the individual. Furthermore, apart from the unknown quantity of persons who had never been registered under the Act and still could not be identified, was the problem of the amounts owing individually and in the aggregate, by those persons who had been registered at late dates, whose exact previous liability was not easily ascertainable. Any attempt, therefore, to take into the accounts of the Service figures supposedly covering the revenue due to them from such persons was futile. In an endeavour to approach the problem from possibly the most practical and sensible point of view, this Board considered that their first duty was to attempt to make recommendations which would have the effect of securing the registration of as many unregistered persons as possible, and bring into the funds of the Service as much as was possible of the revenue to which they were definitely entitled from the non- registrants and delinquents mentioned. The Board considered this matter very seriously over a period of weeks, after becoming acquainted with its great importance; and as a result of their deliberations, they submitted to the Minister of Health and Welfare, on September 25th, 1951, their Interim Recommendation No. 4. The Minister discussed this interim recommendation very fully with the Board at certain of its sessions, and, as a result, the Board's recommendation was amended, becoming Interim Recommendation No. 4a, which will be found in the appendix to this Report (and dated October 17th, 1951). This recommendation was duly implemented, and publicity was given to the compromise of arrears scheme embraced therein. This scheme, however, was necessarily limited as to time, the final date of acceptance being set at November 30th, 1951. The result of the compromise scheme offered will be considered as satisfactory or unsatisfactory, depending upon the point of view. The Board was informed that, up to the expiry date, 862 persons had taken advantage of the compromise scheme. It can be easily calculated that this meant an immediate addition to the revenue of the Service of approximately $35,000, and while these figures in themselves must be looked upon as disappointingly low, it should not be overlooked that the 862 new registrants committed themselves to pay, in instalments, arrears which would probably amount to a further $65,000—and, more important, they would remain properly registered and (it is to be hoped) satisfied persons under the provisions of the Act. The Board feels that had it been possible to deal with this particular problem at an earlier date, and grant a more extended period of time for acceptance of the compromise scheme, prior to the incidence of a new year, the results would have been much more satisfactory in every way. This matter has been dealt with at considerable length because of the great interest of the public generally, and because the Board believes that the experiment was well worth while and justified, in spite of certain adverse criticism from people who did not take the stand that " half a loaf is better than no bread." The above is preliminary to a recommendation which the Board has decided upon concerning arrears still existing, or to come into existence in the future. It will be found that the Board elsewhere has made certain very definite recommendations, designed to REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 53 bring under the operation of the Act a maximum proportion of the public legally called upon to register, and the question as to a basic decision regarding the arrears of late registrants and delinquent persons still remains. We do not believe there is any necessity to repeat in any way the arguments set forth above having a bearing on this entire question. It would, however, appear to this Board that for the reasons above stated (and other reasons), there must be a limit placed upon the period, or amount, of arrears which any non-registrant or delinquent is called upon to pay. Apart, however, from the position of the individual, it is the definite opinion of the Board that there is a marginal value only to arrears going beyond a certain point in time or amount; and that beyond that marginal value the cost of collection, not only in terms of dollars and cents, but also in terms of goodwill, becomes definitely prohibitive. There is the further point that the Administration is faced with an impossible task in trying to estimate the true value of such delayed arrears, and the keeping of accounts of such a nature in itself entails the engagement of staff in clerical and accounting work far beyond the realizable sums. The Board therefore recommends that, effective not later than July 1st, 1952, a person becoming registered under the Act, or having been registered, seeking to place himself in good standing, shall be required to pay a sum equal to the premium for the current year as regularly provided, and the arrears for the previous premium-year if he is liable for the same. The provisions of this recommendation are intended in no way to interfere with the powers of the Minister or the Commissioner to reduce the amount of, or to suspend indefinitely payment of, arrears owing by any person. No. 33.—COLLECTION OF ARREARS OF PREMIUMS In connection with the collection of arrears owing by any registrant under B.C.H.I.S., the Board points out that it has made recommendations to fix the standing of any person as regards liability for arrears and participation in the benefits offered by the Act. These recommendations, therefore, will have the effect of clarifying absolutely the position of any such person entering a hospital as a patient, and will mean the hospital administration is in no way concerned with arrears of premiums owing by any patient registered under B.C.H.I.S. The position of the registrant in connection with the benefits of the Act will, providing the other recommendations of this Board are implemented, cease to be affected by the arrears which the registrant owes. The Board therefore recommends that the collection, or realization, of the amounts which will from this time be recognized as arrears, and kept on the books and in the accounts of the Service, be a matter for handling by a special collection department of the B.C.H.I.S. Administration, to be segregated completely from the records of current premium payments and the receipt and collection thereof. The term " arrears," as used in this recommendation, would not be intended to mean the late payment of the premium for the current benefit period, but those arrears defined in Recommendation No. 32. No. 34.—EXEMPTION CARDS: ISSUE TO CERTAIN PERSONS AND CHARGE THEREFOR If the recommendations of this Board respecting enforcement of registration under the " Hospital Insurance Act" are adopted, it will be necessary for all persons who come within the provisions of the Act to have an eligibility card to prove registration, which card is usually issued to them on payment of the required premium. Therefore, a special provision will need to be made for those groups who are exempt from the provisions of the Act or from the payment of premiums as individuals, such as members FF 54 BRITISH COLUMBIA of the Canadian Pacific Employees' Medical Association of British Columbia and the Telephone Employees' Medical Services' Association of British Columbia, as well as pensioners and others in low-income groups whose hospital bills or premiums are paid by the Government and, in addition, another group consisting of adult dependents of registrants. The Board therefore recommends that all adult residents of the Province coming within the provisions of the " Hospital Insurance Act" who are, by reason of special exemption or otherwise, not required to personally pay a premium in accordance with the regulations shall nevertheless be required to obtain from B.C.H.I.S. an official exemption card or certificate covering each premium-year or benefit period, as the case may be, and to pay a charge for the said card or certificate amounting to $2 per annum. This requirement shall not apply to the following persons mentioned in section 8 of the "Hospital Insurance Act":— (1) Those persons mentioned in section 8, subsection 1 (a), to whom the Government of Canada provides hospital benefits: (2) Those persons mentioned in section 8, subsection 1 (c), who are covered by the " Canada Shipping Act, 1934 ": (3) Those persons mentioned in section 8, subsection 1 (d), who are employed by the Government of Canada or the Government of any other country: (4) Those persons mentioned in section 8, subsection 1 (/), who are residing in exempted areas: (5) Those persons mentioned in section 8, subsection 1 (g), who are covered by the " Saskatchewan Hospitalization Act, 1948 ": (6) Those persons mentioned in section 8, subsection (3), who are inmates of Provincial institutions, gaols, or penitentiaries. No. 35.—CHANGES OF STATUS The Board learned, from information supplied by the Administration and by Messrs. Stevenson and Kellogg Limited, that there were no positive regulations in force by which the constant and always-recurring changes in status of persons coming within the requirements of the Act may be reasonably put ihto effect and subjected to reasonable control. It would appear, for example, that a person employed up to any date and not being, up to that time, a member of the two exempted groups—namely, the B.C. Telephone Company and the Canadian Pacific Railway Company—has been entitled to demand, consequent upon a change in his employment which places him in one of these two groups, a refund of the exact amount " prepaid " under the regulations which had affected him up to that time. Similarly, changes in status from single to married, or from married to single, lapse of dependency owing to age, or to change of age, and many other changes have been recognized as operating to change immediately the status of the person concerned under the " Hospital Insurance Act" and regulations; and such practice has, according to the information obtained by the Board, led to innumerable refunds, the net amount of which can hardly be ascertained. However, the said net amount of refunds is a minor matter compared with the effect of the very considerable correspondence, record- changing, and other clerical work which must accrue to the Administration under the present system. Tabulation of duties of staff employed in the Payroll Deduction Section shows that in 1951 eleven male and fourteen female adjustment clerks were engaged in dealing with such changes of status, and that five male and twenty-one female adjustment clerks were engaged in the Direct Payment Division of the Administration with similar duties. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 55 The Board has elsewhere recognized the fact that the Act calls for the payment of an annual premium, and has also recommended that this premium may be payable in two instalments, each covering a half-year term. The Board has also elsewhere recommended that there shall be no increase in premiums or reduction in benefits within any premium-year. In line, therefore, with what the Board considers to be the fairness of the two recommendations last referred to, it seems not unfair to provide that there shall be no change in the status of any beneficiary which would affect his standing under the Act during any current half-year period. This would eliminate the major portion of the refunds now applied for and made, with the consequent tremendous volume of work in the offices of the Administration, which has been referred to above. The Board therefore recommends that the Act or regulations shall be amended to provide that there shall be no change in the status of any beneficiary of B.C.H.I.S. which would affect his standing under the Act in any way whatsoever during any current half-year period for which the necessary premium has been paid; but any and all such changes shall have effect only at the beginning of the next half-year period after the date at which a change of status did, in fact, take place. No. 36.—ELIMINATION OF CERTAIN GROUP RECORDS Representations of Messrs. Stevenson and Kellogg Limited to this Board have pointed out that up-to-date group records have been kept by B.C.H.I.S. covering the following groups:— (1) C.P.R. Employees' Medical Association, comprising approximately 14,000 people. (2) B.C. Telephone Employees' Medical Association, comprising approximately 3,000 people. (These two groups are exempt from the provisions of the " Hospital Insurance Act.") (3) Certain war veterans exempt from the provisions of the " Hospital Insurance Act." (4) Armed forces personnel. (5) T.B. patients in institutions. (6) Persons in mental institutions. (7) Inmates of infirmaries and homes for the aged. (8) Inmates of Provincial prisons, penitentiaries, and industrial schools. (9) Residents of exempted areas. (10) Members of the Saskatchewan Hospital Plan. (11) Members of the Royal Canadian Mounted Police. The Board has been advised by the Management Engineers that the total number of individuals for whom these group records are kept is nearly 50,000, and that, if these group records were eliminated, an annual saving of approximately $15,000 per annum in salaries alone would result. The Board believes that virtually no useful purpose is now served by the keeping of these group records, and that under the system covering registration and exemption of individuals recommended by this Board, the need for these records would be even less necessary. The Board therefore recommends that all individuals exempted from the requirements of the " Hospital Insurance Act," whether comprising the membership of the two groups specifically exempted by the Act or being in another category, shall receive an exemption card for every benefit period or a permanent exemption card, wherever possible, and that the separate group records now being kept by B.C.H.I.S. shall be eliminated. FF 56 BRITISH COLUMBIA No. 37.—PAMPHLET COVERING PLAN AND BENEFITS There has been a demand from some quarters for issue of a " policy " which would set out the benefits covered by B.C.H.I.S. to the premium-payer. The Board is fully conscious of the need for some specific outline of benefits, but under a Province-wide insurance service it is questionable whether an insurance policy, according to the accepted definition, is necessary to fulfil this need. The alternative suggested by some is a pamphlet or booklet that would outline not only the benefits extended, but also other facts of interest to all registrants. In 1949 B.C.H.I.S. issued a 16-page booklet giving such information. The same need is taken care of in connection with the Saskatchewan Hospital Services Plan by a folder which can be enclosed in envelopes with notices of payments due, etc. A draft of a similar folder made applicable to the B.C. plan is shown as an appendix to this Report. It is felt, under the circumstances, that a revision of the 1949 booklet, patterned after the Saskatchewan folder, would serve the purpose requested by those who ask for " policies " and, in general, it would be a splendid piece of literature for general distribution. The Board was advised that the Saskatchewan folder cost $3,065 for 500,000, or three- fifths of a cent each. The Board therefore recommends that a pamphlet with details of the plan and benefits, and similar in form to the Saskatchewan Hospital Services Plan pamphlet, entitled " What's Your Question? " should be sent out with all notices of premiums due, and that it be obtained in sufficiently large quantities as will reduce the cost to a minimum and permit it to be used for general distribution. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 57 SECTION 5.—HOSPITAL OPERATION AND MANAGEMENT AND HOSPITAL CONSTRUCTION AND EXTENSION 38. Budgets and the "Fixed Budget" System. 39. " Fixed Charges " in Hospital Budgets. 40. System of Payments by B.C.H.I.S. to Hospitals. 41. Comparative Costs of Hospitalization. 42. Employees' Wage Agreements. 43. Student Nurses: Hours of Work. 44. Responsibility for Hospital Accounts of Evaders.- 45. Elimination of Social Security and Municipal Aid Tax on Hospital Supplies. 46. Purchase of New Equipment: Consent of B.C.H.I.S. 47. Central Purchasing Agencies. 48. Dispensing of Drugs. 49. Chronic Cases (Social Welfare) Remaining in Hospital. 50. General Relations with B.C.H.I.S. 51. Hospital Construction and Extension, etc.: Study of Needs and Provision for Hospital Improvement Districts. No. 38.—BUDGETS AND THE "FIXED BUDGET" SYSTEM Prior to the commencement of any public hearings, the Board held informal meetings with the representatives of certain institutions, including the boards of the Vancouver General Hospital, St. Paul's Hospital (Vancouver), and the Royal Columbian Hospital (New Westminster). On July 26th the Board commenced a tour of the Interior of the Province which lasted until the middle of August, during which time they visited thirty hospitals and heard thirty-seven submissions made by the boards of management of hospitals. During the month of September the Board continued its itinerary of public hearings, journeying to North Vancouver, the Fraser Valley, and Vancouver Island, during that time visiting five hospitals and hearing fifteen submissions of the boards of management of hospitals. At each and every one of these sittings and hearings, the Board endeavoured to develop fully a frank discussion of all problems having to do with hospital operation and management as related to B.C.H.I.S., and it may safely be said that this purpose was fully accomplished. It was evident from the outset, up to and including the last hearing of the Board, that the greatest cause of concern to the hospital boards of the Province was the matter of hospital budgets and, more particularly, the effect of the " fixed budget" system introduced by B.C.H.I.S. With one or two exceptions, the story placed before the Board was the same on all occasions, being to the general effect that the hospitals of the Province could not operate under the present " fixed budget" system; that they could not avoid substantial deficits for the year 1951; that certain items of expenditure were improperly disallowed in the said budgets; that due provision was not made or allowed for increasing costs of which there could be no accurate estimate or foreknowledge; and, further, that advice of cuts in the budgets submitted to B.C.H.I.S. had not been received by the hospital boards until the end of April or later in 1951, and during the first four or five months of the year the operations of the hospitals had been carried on in anticipation of a reasonable acceptance of their budgets as submitted, and they were thereafter advised of the fact that they were expected to reduce their expenditures for the entire year to provide for the very substantial cuts made in their previously anticipated income. Another very important aspect of this matter was the fact that even though the per diem rate finally set for 1951 was a higher rate than had been in effect for 1950, FF 58 BRITISH COLUMBIA the hospitals had billed the " other agencies " (such as the Workmen's Compensation Board, the Canadian Pacific Employees' Medical Association of British Columbia, and the Telephone Employees' Medical Services Association of British Columbia) at the old rate until the new budget rates were finally set in April or May, and the hospitals were unable to collect from these agencies retroactively at the increased per diem rate which was made applicable to the entire year as far as B.C.H.I.S. was concerned. The Board afterwards ascertained that the hospital budgets which were originally submitted were finally reduced by B.C.H.I.S. by a gross amount of $991,850, but that the portion of the aggregate budgets chargeable to B.C.H.I.S. was reduced by $819,268. It is impossible to set down here the entire volume of written evidence which was submitted to the Board to show the views and alleged position of the hospitals consequent upon the decisions made by the Legislature and the B.C.H.I.S. Administration, and it is pointed out that these written submissions were supplemented by an even greater weight of evidence and opinions verbally submitted to the Board. The Board, however, feels that to deal with this matter adequately in this Report it must here record the written opinions of certain hospital boards, which are a reflection of all the submissions made. We therefore quote as follows:— From the brief of the Vancouver General Hospital:— One of the major problems faced by all hospitals is the manner in which the budgets are reviewed and approved by the B.C. Hospital Insurance Service. The 1951 budget of the Vancouver General Hospital was submitted to the B.C. Hospital Insurance Service on December 8th, 1950, but it was not until April 30th, 1951, that we were advised by the B.C. Hospital Insurance Service that our rate for 1951 had been revised to $13.60. The covering letter specifying the new rate implied that a reduction had been made in our budget, but neither the amount nor the items to be reduced were specified. We requested advice of the amount of the reduction verbally from members of the Service (including a trip to Victoria for this purpose) but could obtain no answer. On May 31st, 1951, we were informed verbally that the Vancouver General Hospital budget had been cut by $195,000 and, after further requests, we were eventually notified in writing on July 16th, 1951, that our budget had been cut by $194,357. It is unreasonable to expect a hospital to operate on its submitted budget for several months with no official notice of change and then be forced to cut back during the balance of the year a sufficient amount to effect a retroactive reduction in the budget. We feel that some method should be devised so that the hospitals are notified prior to the commencement of the fiscal year as to the final disposition of their budget. One alternative method for this latter suggestion would be that consideration be given to changing either the fiscal year for the hospitals or for the Hospital Insurance Service. Recommendation: That budgets be approved prior to the commencement of the hospital fiscal year. If a hospital exercising careful controls over its budget is told to make an arbitrary reduction in that budget, service must suffer. This tren,d would develop into a most serious situation. Medicine is dynamic and progressive and there will be an inevitable and necessary increase in the cost of hospital care. To set up arbitrary controls that are going to decide what increase in service, if any, may be permitted is unwise. Each hospital should be required to exercise most rigid economies but, that having been done, the B.C. Hospital Insurance Service should carefully consider covering the full amount of the budget, and should discuss the situation with representatives of the respective hospitals before making any reductions. Unless this is done the standard of hospital care in the Province of British Columbia will slowly but surely deteriorate. We had carefully prepared and submitted a budget for 1951, showing a total expense of five and three-quarter million dollars. Before submitting the budget, the original requests from our department heads had been reduced by $174,000 and in addition another $144,000 had been deducted from salaries to allow for possible vacancies (based on previous experience and current conditions) due to lack of available employees and turnover. While the budget estimates for 1951 were being prepared, the Commissioner and the Assistant Commissioner visited the hospital and discussed with the Director and the Controller the probable costs for the coming year. At that stage, the final budget had not been completed. At no time after the Vancouver General Hospital budget for 1951 was submitted to the B.C. Hospital Insurance Service did anyone communicate with us to discuss any phase of our estimates. Recommendation: That the budgets be reviewed by the B.C. Hospital Insurance Service with the representatives of the respective hospitals before final approval. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 59 From the brief of the Royal Jubilee Hospital, Victoria:— Hospital service in this Province would have deteriorated to a dangerous level if the Government had not assisted hospitals on planned basis through the establishment of hospital insurance and yet the hospitals are still faced with financial problems because labour costs and the cost of supplies have accelerated in line with the increased costs of other industries. Until the adoption of the " fixed budget " principle it was incumbent on each hospital to keep a full house in order to create additional income. It is as ridiculous to price hospital care at a per diem rate as it would be to pay fire departments on the basis of the number of alarms or to pay school boards in direct relation to the number of children. A hospital budget fluctuates very little in relation to the occupancy and the payment of a fixed budget is a principle used for many years in hospitals. If hospitals knew with certainty at the first of the year the amount they were to receive from the B.C.H.I.S., there would be a greater effort to manage within the limits allowed and there would be no encouragement to keep a high occupancy in order to develop revenue. This suggestion is made on the basis that sufficient funds would be provided to ensure a satisfactory service. Hospital finances have been much complicated by the admission of non-insured persons who have not the ability to pay their hospital charges. The amount of " free work " varies in the different parts of the Province but it is unthinkable that a hospital would refuse admission or necessary available service to a sick or injured person because of indigent circumstances. By using a truly " fixed budget" basis the hospitals would be able to absorb the free work. Hospitals have found it difficult to proceed with capital expenditures because the net result of operations cannot be accurately measured until the end of the year and then the funds on hand may not be sufficient to permit capital expenditures until the accounts are finally settled by the B.C.H.I.S. many months later. With an assured basic income which would allow for a basic minimum of service the hospitals could operate with confidence and gradually improve their services by planning new services with the B.C.H.I.S. Our ratio of expense in the various main divisions of hospital costs are found to be within the ratios prescribed for standard hospital costs and the budget is within .3 per cent of the estimate prepared by the board of directors. However, it should be noted that the budget figures given here for the six months period do not reflect the deduction of $58,000.00 made arbitrarily by the B.C.H.I.S. Costs for the year 1950 amounted to $11.95 per diem and we have been awarded $11.95 for 1951 and do not see how we can keep within this figure for 1951 in view of labour negotiations and other increases in costs without reducing service. Although our costs for 1951 are 10 per cent greater than for 1950, it would appear from available figures that the B.C.H.I.S. intends to pay us less than last year. We contend that this is unrealistic, especially in view of the increased number of patient days. From the brief of the Royal Columbian Hospital, New Westminster:— The Minister of Health and Welfare has stated in the Provincial House that during 1951 hospitals would be asked to operate on a fixed budget. After this budget has been approved by the B.C.H.I.S. the hospital would be expected to live within it. By definition, a budget is a plan to establish and organize a programme of operating performance. As directed, the hospital prepared its budget for 1951 which was submitted to B.C.H.I.S., but no approval of this or an amended budget has been received. How then can a budget plan be implemented and adhered to without some indication of the nature of hospital services and facilities to be provided. The only notification received from B.C.H.I.S. was that the per diem rate for 1951 had been established and that the Royal Columbian Hospital would be required to reduce the over-all estimated expenditures by $146,000.00. No indication was given as to how the per diem rate was arrived at, nor where it was expected that the saving required could be made. It would seem that if the Hospital Insurance Service is to be placed in the position of determining the amount of money any hospital may spend on its operations, then B.C.H.I.S. should also determine the standards of hospital care which they expect the participants in the hospital insurance scheme to receive. Admittedly, such standards would be very difficult to establish, due to the fact that the medical staff of any hospital is primarily concerned with the needs of the patients and they would take little or no cognizance of any predetermined standard, if they felt that such standards were not in the best interests of the patient. This factor alone would tend to defeat the practicability of fixed budgeting. Again, the standard of hospital care will vary from hospital to hospital (some, as our own, providing such services as radiology, pathology, cardiology, etc.), depending on the character of the community it serves, and the types of sicknesses and injuries for which care is required. The Royal Columbian Hospital, situated at the confluence of three major highways, has a prevalence of automobile accidents, which in all probability would not be experienced to to the same degree by any other hospital in British Columbia. FF 60 BRITISH COLUMBIA B.C.H.I.S. has stated on several occasions that it does not wish to disturb the autonomy of the Hospital Board of Management, despite the fact that by virtue of the controls which it exercises over the hospital's finances, such autonomy can not possibly exist. The hospital's revenue is indirectly controlled by the B.C.H.I.S., and consequently this factor predetermines the amount of money which can be expended on the operation of the hospital. The B.C.H.I.S. in its circular dealing with the hospital budgets has left to the Hospital Board of Management the problem of determining where economies are to be made in order to operate within the per diem rate established. Whether or not the B.C.H.I.S. established standards for hospital care, it would seem that the standard should be consistent among all British Columbia hospitals, but the variation in asked-for-expenditure cuts does not appear to permit such consistency. However, neither the directives received from B.C.H.I.S. nor conversations with the officials elicited any information with respect to the standards of hospital care or services to be provided. From the brief of the Vernon Jubilee Hospital, Vernon, B.C.:— We do not object to the present policy of operating on a fixed budget, subject to adjustments to meet unforeseen circumstances or conditions, but we do object to having our budget cut arbitrarily by the Commission. For 1951, our budget was cut by $9,300.00. It was suggested by the Commission that we cut down our wage bill to meet the greater amount of this cut. As all employees are covered by union contracts, wages could not be reduced even if the board should wish to do so. The only alternative would be to reduce our staff. Our administrator states that the staff cannot be cut and still give service. If the Commission provides our funds then we recognize, even if we dislike to do so, that we must accept a certain measure of control over our expenditures. But our objection is to remote control; if we are told to cut our staff, and we do not think that any cuts can be made, then there should be a proper analysis of our operations made on the ground by some one competent to do so. The Commission this year has fixed our rate at a sum at which we claim to be unable to operate. Our rate should either be adjusted to provide the required funds or the Commission should have an expert to tell us where we are going wrong. The policy of having to operate on a certain fixed amount and not on what is actually required to maintain service is wrong. From the brief of the Powell River General Hospital, Powell River, B.C.:— This hospital, in preparing its 1951 budget, did so with aview to the most economic operation, and followed the instructions of the Hospital Insurance Service not to take into account increases in commodity prices or wage increases. The budget for this hospital amounted to $268,685.00—and was cut by $18,000.00. There is no doubt in the minds of this board of management that this cut was made necessary by the lack of funds, caused in some measure by the inability of the Hospital Insurance Service to collect premiums and other Government departments not paying their full share in their incurred liabilities. From the brief of the Penticton Hospital, Penticton, B.C.:— Our bad debts this year will approximate $6,000.00 to $7,000.00 and will account for the greatest per cent of our operating deficit. During the year 1950, proven bad debts were considered as an operational expense. With this in mind, when preparing our 1951 budget, we made only a nominal allowance for those bad debts not acceptable to B.C.H.I.S. The term " fixed " as applied to our budgets as of May 1 st this year was not anticipated. We are well pleased with the general principles of the plan but feel that some remedy must be found in order that the humanitarian basis on which it was founded is not lost in the monetary approach. From the brief of the Chilliwack General Hospital, Chilliwack, B.C.:— The deficit with which we are at present faced and which, in spite of every effort to economize, we are unable to reduce and can see no hope of so doing, as long as we are forced to try to operate on a fixed budget, is our chief concern; for we cannot imagine how this can be made up out of hospital funds, of which we have none, or by the community. Revenue by way of donations has ceased. To the end of July we had exceeded our submitted budget by over $18,000.00. This estimate was submitted in November, 1950, and based on our experience to September, 1950. What was thought at that time to be a fair increase to cover rising costs was added. We were advised that $7,500.00 had to be cut from the budget as submitted with the suggestion that it could be cut from salaries and wages, repairs and linen. From the brief of the Creston Valley Hospital, Creston, B.C.:— Under the fixed budget arrangement made by B.C.H.I.S. our estimates for 1951 were slashed by the amount of $7,000 or 11.2 per cent of our total estimated expenditures, which action we vigorously protested to BCH. Since that time we have repeatedly pointed out that we have attempted but are unable to reduce expenditures to in any way approach this required reduction. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 61 However, whether we are financially able to absorb this reduction or not, we have been forced to do so by monthly reduction of advance expenditure payments by BCH, which places us in the position today of being forced to ask our creditors to carry as unpaid purchase bills our accounts for the month of June—$1,900.00, July—$2,000.00, and a bank overdraft of $1,100.00. You gentlemen are business men, and if you were asked to operate your private concerns as BCH forces hospitals to operate, you would undoubtedly consider closing your doors to further business, as we must at this time seriously consider doing. We members of the (hospital) board are forced in day to day contact to face hospital creditors, and we are sure that if our own businesses were in the same financial position as the hospital is at present, our only recourse would be to turn the key in the front door. BCH has repeatedly insisted that the day to day operation of the hospital is the concern solely of the board, but when our day rate is set for us at a definite figure and our allowed expenditures are cut to meet the revenue supplied by that rate, we fail to see how in any measure we may be held responsible for any deficit that might occur. From the brief of the Rest Haven Hospital, Sidney, B.C.:— The British Columbia Hospital Insurance Service was introduced to help hospitals financially, with definite and repeated promises that the hospital autonomy would not be affected. The opposite has developed. Under the present plan, our entire current working capital has been liquidated, including non-operating funds, due to the factors which follow: 1. Daily rates set by British Columbia Hospital Insurance Service below cost for three consecutive years. (a) Our average gross operating income per adult, child, and newborn patient day during 1948 was approximately $10.75. (b) In spite of inflation and with increased expense during 1949, our gross operating adult and child patient day was reduced to about $9.25, by the Insurance Service. (Public ward rate—$6.70 per day.) (c) In 1950, with the continued inflation spiral, our average gross operating income for adult and child patient day was only $10.15—still below 1948. (Public ward rate—$9.00.) (d) In 1951, our present average is still below the 1948 patient day average income. We are asked to do the impossible—reduce our budget by $10,800.00. (Public ward rate—$9.67.) The inflation spiral is beyond our control, yet the Insurance Service has continually established a rate below our very conservative estimate, and rejected legitimate operating expenses which have been in effect for years. From the brief of St. Joseph's General Hospital, Dawson Creek, B.C.:— We strongly suggest that the fixed budget recently suggested be discontinued and the hospitals be allowed to budget for the ensuing year on a basis of actual previous cost and expected increase, or otherwise. Referring to the fixed budget, we are convinced that this is definitely the wrong approach to the problem, as a fixed budget is an impossibility in hospital work due to the unpredictable circumstances which might arise. Application to the Hospital Management is made for a true statement of expected expenditures and in the case of this Hospital a true statement is given; the consequence is that if this budget is not approved, reduction in the services of the hospital must necessarily ensue. These services have always been at a high standard, economically supplied, and we feel that no cut should be made in the budget as submitted. And finally from the brief of the British Columbia Hospitals' Association:— We would draw attention to the fact that the existing plan commenced with the intention of reimbursing all hospitals at cost for services rendered (section 13, Hospital Insurance Act). It was not long before this ambition was modified by restrictions in services; by refusing to pay interest on borrowed capital; then by disallowing depreciation and, more recently, by arbitrarily cutting down hospital budgets to protect the Hospital Insurance Fund from further deficits. Today the hospitals are trying to carry on their work dressed in strait-jackets. The original intention of the Act was to provide money to meet the needs of hospital patients. This has now changed to cutting down services to patients to meet the needs of the Hospital Insurance Fund. The end product, particularly from the point of view of the individual patient, is an intangible. It is not only intangible, but it is a constantly fluctuating thing. Medical and surgical science is constantly changing. Advances in science are increasing the chance of survival; increasing the chance of complete restoration to health; and reducing the length of time it is necessary for a patient to remain in hospital. Hospitals cannot be efficient and, at the same time, postpone important improvements in treatment until the end of the current fiscal year. There is another facet of hospital work that makes its objectives even more intangible. While FF 62 BRITISH COLUMBIA advances in science and professional and technical skill are important, tender and sympathetic care of the individual is still a vital factor in restoration to health. Psycho-somatic illnesses are numerous. The attitude of the patient towards his illness is a major factor in recovery. It is in this field that our small hospitals have an opportunity to perform a great service, and they do. Who shall assess the exact value of this in terms of dollars and cents? Having thus exhibited the view-point of the hospitals of the Province, the Board now wishes to quote from the submissions made to it in writing on behalf of the College of Physicians and Surgeons and the Hospital Employees' Federal Union:— The College of Physicians and Surgeons of British Columbia.—The financing of hospital care is not our business. We wish to point out, however, that in any hospital a rigid budget, pre-fixed at an arbitrary level by an agency outside that hospital may have a deleterious effect on the standard of medical care. A hospital is a community service institution and cannot be regarded as a boarding-house for the sick. If a hospital exercising careful controls over its budget is told to make an arbitrary reduction in that budget, service must suffer. There is, and will continue to be, an inevitable and necessary increase in the cost of medical care because the economics that result from more efficient means of treatment do not affect the increased costs of more complex methods. The setting up of arbitrary controls at Victoria to decide what increase in service, if any, may be permitted, will have an ill-effect, in time, on the standards of hospital care in British Columbia. The Hospital Employees' Federal Union, Local 180.—While a fixed budget policy may be sound and workable, in a normal period of stable prices, and enable the Government to achieve its apparent aim of stabilization of hospital costs, in our view it is neither desirable nor workable in the present inflationary period. And surely no one will deny that we are in a definite inflationary period. The cost-of-living index recorded for the month of January, 1951, was 172.5; the index as released by the Dominion Bureau for the month of July was 187.6, an increase of 8.8 per cent. Assuming that a reasonable budget for the operation of a hospital in January was $200.00 per month, obviously that same figure would be out of line for the month of July. Simple mathematics would reveal that the budget should now be $217.60 per month. If we can judge from the trend during the first seven months of this current year, a budget established on the basis of January 1st to December 31st, rigid and unyielding, would be still further out of line by the end of the year. It should here be said that the complaint was made in many instances to the Board that whereas the position of hospitals existing (or thought to exist) as at June 30th or July 31st, 1951, had been called to the attention of the Commissioner of B.C.H.I.S., no satisfactory answers had been received by the hospital boards concerned. It was further pointed out that under the regulations in effect concerning the exact operation of the " fixed budget" system, it was not possible for any hospital board or administrator to gauge with any certainty the exact amount of income to be received for the calendar year from B.C.H.I.S. until after the closing of the hospital's books and accounts at the end of the said year. In view of the apparent seriousness of the position of the hospitals of the Province, as presented to this Board, the Board felt it incumbent to give earnest consideration at once to the representations made to them, and to take some action. Consequently, the Board, on September 25th, 1951, caused to be transmitted to the Minister of Health and Welfare its Interim Recommendation No. 5, which will be found in the appendix to this Report. At the conclusion of all its hearings the Board again gave this entire matter of hospital budgets the fullest possible measure of study and consideration. By the time this Report is presented to the Legislature, the true results of hospital operation for the year 1951 may be known, and will reveal the justification, or otherwise, of the importance attached to the matter by the Board and the submissions made to the Board during the summer months. The Board, however, feels that it must endeavour to make a contribution toward the fixing of a reasonable, satisfactory, and acceptable long-range solution of the problems with which the hospitals are confronted in this regard. The Board learned, when investigating the Saskatchewan Hospital Services Plan, that 60 per cent of the finally accepted hospital budgets in the Province are set after REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 63 discussion by a delegation of the hospital board with the administrators of the Plan, the said delegation visiting Regina for that purpose. The Board was told that no flat cuts took place in any hospital budget without discussion as between the Plan and the hospital concerned. They were further told that the administrators of the Plan are willing to negotiate at any time of the year to make retroactive adjustments if necessary. The Board therefore makes the following recommendations:— (a) That the budgets of the hospitals of the Province, when submitted to B.C.H.I.S., must include therein all the anticipated costs of efficient operation, and if the B.C.H.I.S. Administration, upon examination of any budgets so submitted, disagrees with the figures submitted, they shall make prompt arrangements for consultation with the hospital board concerned so that adjustments may be studied and considered; and only after such consultation shall the figures then agreed upon become a " fixed " budget. (b) Such " fixed " budget, nevertheless, still remains subject to agreed changes arising as the effect of circumstances over which the hospital board has no control. (c) There shall be no reduction of a per diem rate set by B.C.H.I.S. and existing in any hospital, made effective until the time when the new budget of the said hospital is fully agreed upon for the year in accordance with clause (a) hereof. (d) That at the commencement of each year the " other agencies " shall be notified by B.C.H.I.S. that accounts rendered to them for hospitalization for which they are liable are on an interim basis until the hospital budgets and rates are fixed for the year by B.C.H.I.S., and that such accounts are thereafter subject to increase or decrease in accordance with the new rates set. No. 39.—"FIXED CHARGES" IN HOSPITAL BUDGETS The general matter of the " fixed budget" system for hospitals and the manner of payments applicable thereto has already been dealt with by the Board in this Report. It was felt unwise to complicate the Board's previous treatment of this subject by injecting arguments or detail having to do only with parts of hospital expenditure. For this reason, therefore, we deal now with the matter of what are generally called fixed charges, usually of an annual nature, to be found in the accounts of all hospitals, as they are found in the accounts of practically any business or institution. The charges we have reference to include allowances or reserves for depreciation on buildings, furnishings, and equipment, allowances or reserves for bad and doubtful debts, provision for interest or carrying charges on capital debts which are the responsibility of the hospital, and any other legitimate reserves or allowances of a like nature. As concerning the submissions made to the Board, in general it may be said that the allegation is that under the "fixed budget" system now in force proper treatment is not accorded to those items by B.C.H.I.S. Throughout the length and breadth of the Province, the Board did not find any hospitals willing to admit that the present rate of allowance for depreciation was in any degree reasonable or sensible. Regarding the allowances for bad and doubtful debts, it would appear that the principal objection arises from the fact that there is no assurance of any certain method of treatment to cover these debts, which may have been incurred from a variety of different causes, such as delayed advice of non-acceptance of a patient's account by B.C.H.I.S., opposition to co-insurance charges, as well as ordinary hazards pertaining to the collection of any business account. Another factor inherent in the whole subject may be mentioned: Due to the rising price level more and more of a hospital's working capital is being tied up in inventories. FF 64 BRITISH COLUMBIA Furthermore, the amount tied up in accounts receivable has been increasing to considerable proportions. As time goes on, therefore, the working capital of hospitals is becoming more and more depleted. The question may well be asked whether the hospitals are expected to find replacement of or additional working capital themselves, or will it be supplied through the Insurance Service? With regard to the matter of interest or carrying charges on capital debts which are the responsibility of the hospital; this, of course, does not affect certain hospitals, particularly municipal hospitals throughout the Province. However, we wish to let the attitude of the hospitals, expressed in many written briefs, speak for itself on all these points by quoting from the submissions made to the Board, as follows:— Nanaimo Hospital, Nanaimo, B.C.—Furthemore, no allowance is admitted for depreciation on the buildings or equipment other than an arbitrary 10 cents per bed-day on occupancy. In the case of this hospital, this will amount to not more than $3,000.00 a year. The building and equipment have recently been appraised at a valuation of close to half a million dollars, and the depreciation, which would normally be taken on this investment by any commercial concern, would be in the neighborhood of $25,000.00 a year. Similarly the Commission will not allow interest on the bonded indebtedness as an expense in calculating the day date, although it is an actual cash outgo, and must be made up from funds other than those received from the Commission. Fortunately, up to the present, our donations and bequests have been sufficient to meet this expense. But it does not seem reasonable that the Commission should be arbitrarily allowed to expropriate our services without including in the per diem rate items of expense such as depreciation and bond interest, which are indisputably a part of the expense of running the institution just as much as are wages, materials and supplies. St. Martin's Hospital, Oliver, B.C.—The building was designed by the government architect and the government subsequently made a grant of fifty thousand dollars towards the cost of the building which ultimately amounted to one hundred and thirty thousand dollars. The Sisters of St. Ann, therefore^ had to raise by way of a loan from the Credit Foncier, some eighty thousand dollars, which the hospital society reduced by some ten thousand dollars through public subscriptions. In the course of negotiations with the Sisters of St. Ann, the board of management was constituted by the election of four members from the community, four nominated by the Sisters of St. Ann (two of whom are local citizens) and one member nominated by the Lieutenant- Governor in Council, completing a board of nine members. The hospital society agreed that any money contributed by the Sisters of St. Ann towards the cost of the building should be repaid out of the depreciation account, until this indebtedness had been liquidated. It was further agreed that the hospital should be operated by the Sisters of St. Ann without recourse to public support. Prior to the advent of the B.C.H.I.S., depreciation at the rate of five per cent was set up to amortize the debt and the balance remaining as at the 31st of December, 1949, was $40,100.00. The B.C.H.I.S. makes no allowance for depreciation, the only means therefore of repaying the debt is out of the Sisters' personal salaries. Some argument may be advanced to commend this method of repayment, but the board of management feels that such an argument cannot be justified, either legally or ethically. Royal Inland Hospital, Kamloops, B.C.—Amounts allowed for depreciation of buildings and equipment are not adequate and in view of the fact that working capital of the hospital has disappeared entirely, in meeting increased costs and annual deficits, a substantial change should be made allowing sufficient funds to avoid accumulation of replacement, maintenance and renewal expenditures for which no money is or will be available under the present method in use. Vernon Jubilee Hospital, Vernon, B.C.—It is suggested that the present policy of the Commission with regard to depreciation allowance is not good business practice. Hospital boards are not permitted to charge any depreciation as an operating cost, except an allowance of 10 cents per patient day. This is far from adequate, and we cannot help feeling that the present policy is dictated not by sound business principles but by motives of expediency. Rest Haven Hospital, Sidney, B.C.—The following changes would materially strengthen the plan and give hospitals a foundation on which to operate. Make provision for proper depreciation expense based on regular established depreciation schedules, at least for those hospitals where capital investments were financed by the hospital. St. Joseph's General Hospital, Dawson Creek, B.C.—(1) We strongly suggest that the depreciation allowance formerly in force in the Hospital Insurance rules, or some form thereof, be restored immediately. Referring to item number (1) above, we can only refer to the experience of the St. Joseph's General Hospital and the difficulties that have been met since the Hospital Insurance Plan has ^■■ppp REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 65 been put into effect. At the inception of Hospital Insurance Service there was a deficit of approximately $46,000.00 which had been incurred by the Hospital with a view at that time of repaying to the loaning organization, with interest. Since the Hospital Insurance Service merely reimburses at operating cost, there has been no possibility of any repayment of the loan. It is felt therefore that in all fairness interest should be considered as an operating cost, and the only feasible way would be to pay the loan out of a depreciation fund. Finally, the British Columbia Hospitals' Association may be said to have summed up the situation in the following introductory remarks to their brief presented to this Board:— We would draw attention to the fact that the existing Plan commenced with the intention of reimbursing all hospitals at cost for services rendered (Section 13, Hospital Insurance Act). It was not long before this ambition was modified by restrictions in services; by refusing to pay interest on borrowed capital; then by disallowing depreciation and, more recently, by arbitrarily cutting down hospital budgets to protect the Hospital Insurance Fund from further deficits. Today the hospitals are trying to carry on their work dressed in strait-jackets. The original intention of the Act was to provide money to meet the needs of hospital patients. This has now changed to cutting down services to patients to meet the needs of the Hospital Insurance Fund. The Board fully realizes that the matters referred to are most important, and have a considerable bearing on the operations of hospitals and likewise on the operations of B.C.H.I.S. The Board is not prepared to put forward any recommendation which makes possible a complete solution of the whole problem. In view of other recommendations made by the Board, it feels that the question of bad debts and allowances therefor will assume a minimum importance in the near future, and with regard to the other two divisions of this subject,— The Board now makes the following recommendations:— (a) That in the case of hospital equipment, full depreciation allowance (in accordance with the classification thereof) shall be permitted as an annual operating cost in hospital budgets, in order to cover equipment replacement; and (b) That the entire question of allowances for depreciation on buildings, and carrying charges on capital debts which are the responsibility of the hospital board, shall be the subject of serious study by the Administration of B.C.H.I.S. at the very earliest possible date, with a view to a more satisfactory agreement being reached concerning these charges between the hospital boards and the B.C.H.I.S. No. 40.—SYSTEM OF PAYMENTS BY B.C.H.I.S. TO HOSPITALS This is a matter which is, of course, definitely bound up with the general subject of hospital budgets, and particularly with the present system of " fixed budgets," on which subject other recommendations are elsewhere made by the Board. This phase of the matter has been the subject of thorough discussion with the boards and administrators of many hospitals. It is a somewhat involved matter, and a variety of opinions has been expressed in connection therewith. The arguments advanced take into account the effect of the depleted working capital of many hospitals, the fact that advances made on earlier dates by B.C.H.I.S. to hospitals are in many cases deducted from the current payments due to these hospitals, and a great many other factors. It has been suggested that the system in force should be changed in various ways, and the extreme position taken is, of course, that the hospitals should be paid by B.C.H.I.S. on a month-by-month basis for all services rendered. The Board has looked closely into the manner of payments now in force in conjunction with the " fixed budget" system. Briefly, it may be stated that the total amount of the " fixed budget" of any hospital having been arrived at, it is reduced to a per patient-day basis, and this is broken down into two distinct parts—namely, the constant cost and the variable cost. The said 3 FF 66 BRITISH COLUMBIA constant cost is then supposedly paid to the hospital concerned in twenty-four semimonthly instalments, and the variable cost is paid to the hospital in monthly instalments, in amounts depending on the accounts submitted for patients actually passing through the hospital. We find, however, that the payment (of the constant instalment) is, each month, based upon the occupancy for the previous month. This has led to dissatisfaction on the part of the hospitals because of the complications which ensue. It should be clear that a hospital may receive in July a " constant" instalment payment based on a very low occupancy experienced in the month of June, whereas the July rate of occupancy may have gone to a much higher level, and the consequent cost of the hospital operation for the second month is in many respects increased, and to meet these increases promptly the hospital does not have immediately available the adequate funds. The Board fully realizes that this is not a simple matter to any but accountants, and has no desire to set down here all the technicalities involved. It does, however, seem to the Board that the approach made to a proper system of payments to hospitals is somewhat in the nature of a negative rather than a positive approach. Furthermore, the Board must report that it has been impressed by the apparent superiority of the system in force in the Province of Saskatchewan. Under this system the " fixed budget" of the hospital, arrived at on an agreed-occupancy basis, is also broken down into the constant and variable factors, but payment of the portion of the " fixed budget" which covers the constant factors is made to the hospital in twenty-four equal and unvarying instalments throughout the year. The "variable" cost is then paid to the hospitals as the actual " occupancy " bills are rendered and passed. It should be mentioned that the Board was told that the straight payment of the entire per diem rate had had a tendency to encourage the overcrowding of hospitals, and that therefore the system of "hold-back" of the " variable " cost was instituted. It appears to the Board that this system has at least the merit of giving exact knowledge to the hospital of a minimum monthly cash income which it will receive from the Service, thereby enabling the hospital administration, as far as possible, to fit their operations into this definite pattern; and it is possible that there is considerable inducement to the hospitals to operate as closely as possible to this fixed sum, with the result that a considerable measure of economy is effected. For these reasons, the Board now recommends that the system of B.C.H.I.S. payments to hospitals be reviewed, with the object of arriving at a more satisfactory plan; and the Board is of the opinion that the system in use in Saskatchewan should be followed, unless specific and valid reasons exist in favour of some other system. No. 41.—COMPARATIVE COSTS OF HOSPITALIZATION In the course of its work the Board obtained from various sources outside the Province information as to hospital costs, but probably of the greatest interest, and most closely comparable to the British Columbia costs, were figures obtained from the Province of Saskatchewan. The Director of the Saskatchewan Hospital Services Plan supplied the Board with fully detailed figures of several hospitals in that Province, both as regards actual costs for 1950 and approved budgets for 1951. It is not possible to say that the operations of any hospital in Saskatchewan are exactly comparable to the operations of any one hospital in British Columbia because there will necessarily be some varying features. For instance, two hospitals with the same rated bed capacity will not necessarily have the same percentage of occupancy or total of patients' days. Then a hospital of a certain size in Saskatchewan might have a training-school, whereas there might not be any training-school in conjunction with a hospital of comparable size in British Columbia; or, again, a hospital of a certain size in Saskatchewan might be in the " Catholic Conference " group, but the comparable hospital in British Columbia might be under a different form of management. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 67 However, the Board caused certain comparisons to be made. In the appendix to this Report there will be found a Summary of Comparative Figures for Hospital Operation for 1950, in which are the figures of actual operation of a Saskatchewan-town hospital with a rated capacity of sixty-one beds, and the actual figures of seven hospitals in British Columbia of reasonably similar rated bed capacity. It will be noted that the actual patients' days vary considerably in most of the comparative figures, and, necessarily, the percentage of occupancy also varies. Bearing these variations in mind, the study of comparative costs is nevertheless most interesting and informative. It will be particularly noted that the cost to B.C.H.I.S. of the hospital in British Columbia having the number of patients' days most nearly equivalent to the figure for the Saskatchewan institution cost the B.C. Service slightly over 60 per cent more than the Saskatchewan hospital cost the Saskatchewan Hospital Services Plan, although the actual patients' days of the B.C. institution was less than SVi per cent in excess of those of the Saskatchewan institution. The detailed figures set out in this comparative summary are quite clear and need not be repeated here. It is, however, quite apparent that the very considerable excess of costs in British Columbia over those in Saskatchewan arises chiefly from the difference in the amount of net wages and salaries paid in the comparable institutions. In the case of the two hospitals quoted, it will be noted that the total net wages paid in the B.C. hospital was 120 per cent higher than the total paid in the Saskatchewan institution. For this reason, the Board also presents, as an appendix to this Report, a comparative statement of staff employed for the year 1951 in a hospital in a B.C. city and in a city hospital in the Province of Saskatchewan. It will be noted that the rated capacity of these two hospitals is not exactly the same, but the figures covering the percentage of occupancy, the total patients' days, and costs are plainly set out. It is felt that these comparisons will be of very great interest to all concerned with the problem of hospital costs in the Province of British Columbia. The Board, of course, knows that there are certain basic circumstances existing which cause, and partly account for, the very great difference in costs as between Saskatchewan and British Columbia. One or two of these factors that might be mentioned are the over-all higher wage rates in British Columbia and the high standard of hospital service in British Columbia. The last-mentioned factor necessarily includes the use or allocation of a considerably greater measure of nursing service per patient per day, with the resultant numerical increase in nursing staff. The Board, however, is not completely satisfied that the wide variance shown in the total-cost figures of similar institutions can be entirely and completely justified or approved. As already stated, the Board could put forward many factors and arguments in support of the position of the B.C. institutions, but this does not mean that the Board has had the opportunity of going thoroughly into all phases of the matter, and the Board believes that such thorough investigation and study would be a most desirable undertaking. Apart from any other consideration, the evidence obtained and referred to here certainly seems to support the views of the Board as expressed in another recommendation, concerning the development by B.C.H.I.S. of an organization of trained personnel that may render maximum assistance to hospital boards and administrators in connection with various phases of hospital operation and management. It is, however, believed that the importance of the matters referred to above is such as to call for positive consideration, and— The Board therefore recommends that the Administration of B.C.H.I.S. shall arrange, at as early a date as possible, for adequate and full conference with the executive of the British Columbia Hospitals' Association and other interested parties, with a view FF 68 BRITISH COLUMBIA to giving intensive study to the matters referred to above, and to arrive at conclusions as to whether or not the comparative position of the hospitals of the Province is sufficiently justified. No. 42.—EMPLOYEES' WAGE AGREEMENTS One of the most important matters considered by the Board was the entire subject of wage rates negotiated by the duly authorized bargaining agents for hospital employees with the various hospital boards, and the manner in which they are affected by the " fixed budget" policy of B.C.H.I.S. Very strong representations were made in this connection. Most of these submissions were made verbally to the Board by many hospital boards and administrators, and by the representatives of the Hospital Employees' Federal Union. Dealing first with the view-point of the hospitals, we quote from four briefs which were submitted in writing, and which, to some extent, may be said to set out the views generally held by hospital boards throughout the Province. It will be noted that, in addition to the main subject of wage and salary rates, a great deal of attention has been given to the question of employers' contributions to pension or superannuation funds:— North Vancouver General Hospital.—Causes of additional cost are brought about by the formation of unions which have attained very high percentage increases as compared with the cost of living. Our agreement with labour unions, according to the Act, should be carried out, but the B.C.H.I.S. will not allow us to do this because they have materially cut our budget. We feel that the only fair way for labour-union agreements is to work on the cost-of-living basis, which we are endeavouring to do. Royal Columbian Hospital, New Westminster, B.C.—Other problems requiring consideration are: (1) The need for regional union bargaining annually with each hospital in a given area represented at negotiations. (2) The establishment of one approved superannuation scheme. Rest Haven Hospital, Sidney, B.C.—Assurance was given to all hospitals that the advent of B.C.H.I.S. would not affect regular, established, legitimate operating expenses. After a period of two years, B.C.H.I.S. rejected certain of our operating expenses without any reason. The main item was an inexpensive but comprehensive pension plan which has been part of our regular operating expenses since 1922. The Board feels this should be accepted as an operating expense for the following reasons—the Hospital Insurance Service's original policy provided for the acceptance of hospital operating expenses that were in effect before the advent of the Service. Our employees' pension plan has been in effect in this hospital for the past thirty years. The Honourable George S. Pearson promised that " Services existing in hospitals prior to the advent of compulsory hospital insurance would not be curtailed or interfered with." The Hospital share of our pension fund is only 3 per cent of our payroll, which is very much lower than other hospitals with pension plans. Pension plans of other hospitals which were in effect before 1949 are being allowed. Another view-point is expressed by the Royal Jubilee Hospital, Victoria, as follows:— During the past few years hospital employees have taken advantage of the I.C.A. Act to secure adequate bargaining privileges with hospital management and the employees no longer feel that they should make a contribution to the community because hospitals cannot afford higher wages. There can be no doubt that hospital employees are entitled to a fair wage but the hospital employees generally feel that they should retain all of the privileges which are traditional to hospital employment because of the low wage structure, and also receive wages comparable to modern industry. Hospitals are giving more in perquisites than most types of occupation. Hospital employment has become more popular since the inception of B.C.H.I.S. and it is not difficult to recruit good personnel in most urban hospitals at the present time. To better understand the labour problem and the mounting cost of hospital payrolls, it is suggested that the Hospital Inquiry Board might meet with official committees from properly organized employee groups. Then, turning to the employees' point of view, the main submissions on their behalf were made by the Hospital Employees' Federal Union, Local 180, which, we understand, is the bargaining agent for the majority of hospitals organized under the " Industrial Conciliation and Arbitration Act." REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 69 The representatives of this body first appeared before the Board in Vancouver in September, when they made urgent representations to the Board in support of a written brief, from which we quote somewhat extensively as follows:— We feel however that the burden of maintaining a service which is for the benefit of all should be borne by all on a fair and equitable basis. No group of employees should be singled out to make special sacrifices or to subsidize a service which all enjoy. In our opinion, hospital employees are being singled out and penalized. Regulations have been issued by the Hospital Insurance Service which seriously curtail the power of hospital employees to negotiate effectively for wage increases which are necessary to offset the continued rapid rise in the cost of living. In 1950 the government introduced its " fixed budget" policy to control the financial operations of hospitals in British Columbia. The introduction of this policy, coupled with an amendment to the Hospital Act, passed at the last session of the Legislature, seriously weakens the bargaining position of hospital workers. Under the amendment referred to above, hospital workers are required to complete their negotiations by November 30th for all agreements for the next calendar year. This means, for example, that all our negotiations with hospital boards on wage contracts for the year 1952 must be completed on November 30th, 1951. As a result of this regulation, also, the wage negotiations of hospital employees are now governed by the provisions of two separate statutes—the Industrial Conciliation and Arbitration Act and the Hospital Act. In order to meet the deadline of November 30th, set out in the Hospital Act, and at the same time comply with all the steps required in the conciliation and arbitration under the ICA Act, negotiations on wage agreements must commence not later than September 1st, four months before the annual contracts being negotiated are to go into effect. In normal times it would be difficult enough to begin negotiations at such an early date. In the present uncertain inflationary period, it places us in an almost impossible position. We are forced to " guess " what economic trends will be, and their possible effect on the cost of living, four months before the wage agreement is to become operative, and sixteen months before it will expire. Even a competent economist would hesitate to make such a prediction with any degree of accuracy. It is neither fair nor reasonable to expect hospital workers to do so. We also find ourselves set apart from the rest of the organized labour movement, with additional handicaps placed on our wage negotiations. We are now required to negotiate all our wage contracts simultaneously during a concentrated three-month period of the year with numerous local hospital boards located in many distant parts of this large province. Furthermore, there is no guarantee that even if an agreement on wages is reached between a local hospital board and its employees, the decision is final and binding. The budget is subject to review, and possible revision or veto by the authorities in Victoria. This right to veto has already been exercised by the Insurance Service when it disallowed a concession gained by the employees of the Royal Columbian Hospital in New Westminster. But, ten miles away, the employees of the Vancouver General Hospital are covered by this same condition of employment and the cost recognized by the Hospital Insurance Service. Thus the position is that a budget drawn up by a local hospital board, including estimates for wage increases agreed upon after lengthy negotiations, may be curtailed. Such a reduction in the budget may wipe out the estimates providing for a wage award. Under these circumstances, we contend that the rights guaranteed to employees under the labour legislation of the province are denied to hospital workers under the regulations of the Hospital Act, inasmuch as the authorities in Victoria, through control of the budget, can over-rule the decisions of the local hospital boards, the bodies with whom the negotiations must be carried on. Apparently for us free trade union bargaining no longer exists. Through their union, hospital workers seek first to establish reasonable wage scales, and second, to maintain their real wages in a period of rising prices through the negotiations of wage increases. Under existing conditions, we do not see how the fixed budget policy of the government can operate without interfering with the opportunities of workers to ensure and maintain a reasonable standard of living. This is clearly illustrated in cases where local hospital boards grant, as some have, a cost of living bonus which calls for adjustments to keep pace with the rise in the cost of living. If the local hospital board is to live up to its agreement and grant the increases provided for under the contract, the Hospital Insurance Service will have to deviate from its " fixed budget " policy. We believe that a continual attempt on the part of the government to adhere rigidly to a fixed budget in the face of unpredictable price increases in all hospital costs, supplies, and equipment as well as wages, will be an added threat to the wage levels and living standards of hospital employees. Governments themselves find that they cannot function without supplementary estimates. In our opinion, some method must be provided to ensure flexibility in hospital budgets in order that the health service and wage standards will not suffer. There has been no increase in the contributions of 70 cents per day toward the upkeep of hospitals which the municipalities have been paying for the past ten years. A contribution of 4 FF 70 BRITISH COLUMBIA 70 cents today is equivalent to only 35 cents as compared with ten years ago. In terms of purchasing power, hospitals are receiving only 50 per cent of the value of the contribution at the time the figure of 70 cents was agreed upon. Of all municipal services, hospitals alone have not received an increased share from local taxes. Roads, sewers, schools, fire and police protection, and the whole range of essential municipal services are now being financed and maintained at much higher rates. Hospitals are no less important to citizens than any of these other services. The local community has a responsibility towards its hospitals. It is scarcely logical that such an important service should be discriminated against in this way. Hospitals should share in the increased taxes which are being levied and collected by local authorities. We cannot allow this opportunity to pass without some reference to the charge which is repeatedly being made that wage costs are the cause of the rise in hospital costs. It is true that substantial improvements have been made in the wages and working conditions of hospital employees. This was a necessary step. Hospital employees were a group of depressed workers in a depressed industry. Their wage increases were long overdue. But higher wages do not necessarily mean higher operating costs. On the contrary, higher wages promote greater efficiency and can contribute to lower costs of operation. We come back to the vital matter of wage negotiations for hospital employees. The British Columbia Hospital Insurance Service places the responsibility for wage negotiations in the hands of local hospital boards. The former does not enter directly into these negotiations. If local hospital boards have autonomy in regard to the wages of their employees, as contended by the Hospital Insurance Service, then agreements arrived at between local hospital boards and their employees in regard to wages should be accepted by the Hospital Insurance Service. If the Hospital Insurance Service reserves the right to control the budget, as it does, and through this control upset the basis on which wages are financed, then local hospital boards do not enjoy autonomy in regard to wages, nor do hospital employees enjoy the rights of collective bargaining to which they are entitled under the provision of the ICA Act. If the results of negotiations carried out strictly in accordance with the Labor Act of the province can be arbitrarily wiped out by a body to which we do not have access and which was not a party to the wage negotiations, a situation exists which is a serious threat to the bargaining rights and wage standards of hospital employees. In conclusion, our membership respectfully submits the following recommendation—that local hospital boards should have autonomy in regard to wages and working conditions included in wage agreements with their employees and the cost of wage awards shall be incorporated in budgets of the hospitals concerned. The Board at that time promised to give due study and consideration to the representations which had been made. However, during further deliberations of the Board in Vancouver, toward the end of October, representatives of this organization asked to be allowed to again appear before the Board, and this privilege was granted. While the contentions of the hospital boards and the hospital employees' representatives are set forth at some length above, and possibly do not need to be enlarged upon, it might be stated, to simplify the matter, that the chief causes of complaint are that the hospital boards of the Province have been rendered virtually impotent to agree to wage and salary increases, cost-of-living provisions, etc., duly negotiated with the bargaining agents of their employees in accordance with the laws of the Province, because of the effect of the " fixed budget" policy of B.C.H.I.S., and the directives issued thereunder. Attention was specifically drawn to the circular letter, dated July 13th, 1951, addressed to hospitals by the Commissioner of B.C.H.I.S., which reads as follows:— To all Approved Hospitals: Some time ago, hospitals were notified that the government was adopting a policy of fixed budgets with regard to the operation of hospitals in this province. This policy was deemed necessary in order to make it possible to coordinate the financing of hospital operation through the Insurance Service with the overall policy of government finances. The Hospital Insurance Fund is supported by premium payments, municipal and provincial per diem grants and additional assistance from the provincial government. The total amount of money available to the Service through the fund is decided upon during the session of the legislature each year, and there are no additional monies available during the year for hospital operation. It is essential then that the expenditures from this fund to hospitals be kept within the amount provided in the fund each year. To achieve this, the policy of firm budgets has been adopted and it is desirable to call your attention at this time to the fact that the Hospital Insur- REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 71 ance Service has been directed by the government to adhere to the decision to institute and carry out this fixed budget policy. , Under these circumstances then, hospitals will readily realize that this policy is not compatible with any arrangements whereby expenses might vary in accordance with any proposal which embodies an escalator clause necessitating increased expenditure during a year of operation. If a hospital board enters into a wage agreement which contains a cost-of-living clause, or extends the life of an existing agreement containing such a clause, and it becomes necessary during 1951 and following years to make an upward salary adjustment as a result of the cost-of-living bonus clause, it will be the responsibility of the hospital board to provide the additional funds required to finance the salary adjustment or, alternatively, to reduce other expenses by a like amount. The application of the fixed budget policy does not make available funds for interim adjustments of this nature during a financial year, and it is therefore essential that hospitals adhere to the budget which has been approved for the year's operations. This directive, properly read, is, of course, quite clear; it says that by virtue of the "fixed budget" policy adopted by the Government, responsibility for finding the funds to cover any form of wage increases not included in the accepted budget must rest with the hospital board concerned and cannot be accepted by the B.C.H.I.S. At its last interview with the Board the Hospital Employees' Federal Union drew the attention of the Board to the fact that they had negotiated wage agreements for 1952 with the Vernon and Kelowna Hospitals, and that a few days later they had received from the Administrator of the Vernon Jubilee Hospital a letter, dated October 12th, 1951, from which the following is quoted:-— I have been instructed by Mr. K. W. Kinnard, Chairman of the Board of Directors of this hospital, to advise you that the B.C. Hospital Insurance Service is not willing to accept the terms of the agreement as tentatively agreed upon at the meeting held with you on October 2nd. I am not in a position to give you any detail at this time as it is the intention of the President to confer with representatives of the B.C.H.I.S., who will be in attendance at the B.C. Hospitals' Association's convention which is to be held in Vancouver from October 16th to 19th. The representatives of the Hospital Employees' Union interpreted the statement in the two documents referred to as being a denial by the Commissioner of B.C.H.I.S. of the rights of hospital boards and hospital employees to agree upon wage rates and conditions in accordance with powers conferred by the laws of the Province. It must be admitted that in view of the position in which the hospital boards are placed by the " fixed budget" provisions of B.C.H.I.S., the factual result is as stated by the Hospital Employees' Union. It should also be stated quite clearly, in all fairness, that the union representatives frankly admitted that because of the nature of the duties of hospital employees, strike action on their part was unthinkable. In consultation with Dr. Baird, Administrator of the Regina General Hospital, the Board learned that the Saskatchewan Hospital Services Plan does not tell the hospital what it can and must do in connection with wage agreements, but rather insists on the hospital board negotiating the best deal it can get. The Board laboured long and arduously in an effort to find some satisfactory solution (or recommendation) concerning this very important subject. The Board has elsewhere dealt with the matter of future hospital budgets and, in the hope that their recommendations in connection therewith will be accepted and implemented, the Board believes that this entire matter of wage rates, in all its detail, may thereafter be brought to a completely satisfactory conclusion. The Board does not feel that it is now in a position to pronounce final judgment upon the very important question with which it has been grappling, and the best it can do is look forward to satisfactory action being possible when its other recommendations for changes in the Service have been studied and adopted, and to some extent put into effect. The Board now therefore recommends that, because of the evidence of a great deal of dissatisfaction on the part of the hospital boards of the Province and the employees thereof, as represented by their bargaining agents, with the attitude and actions of B.C.H.I.S. concerning wage agreements, and because the Board believes it is not the FF 72 BRITISH COLUMBIA function of B.C.H.I.S. to interfere directly or indirectly in the matter of wage negotiations, an early conference of all interested parties be held—namely, the hospital boards or Hospitals' Association, the hospital employees or their bargaining agents, and representatives of the Department of Labour—in which conference the Administration of B.C.H.I.S. shall take no part: And, further, that the Board point to the agreements which have been arrived at and are now in force with policemen's and firemen's organizations in various parts of the Province, as forming a possibly acceptable solution on which to base a permanent policy as regards hospital employees and the terms of their employment. It is intended that the aforementioned conference shall deal with all matters having to do with the position of employees of hospitals, including the matter of pension and superannuation funds and the allowable contributions thereto of hospital boards. No. 43.—STUDENT NURSES: HOURS OF WORK The Registered Nurses' Association of British Columbia submitted a most constructive brief to the Board. Many of their suggestions are reflected in the Board's recommendations. Their submission contained a reference to hours of work of student nurses, as follows:— The Registered Nurses' Association has drafted recommendations concerning hours of duty and health protection for student nurses. These with certain modifications have been approved by the Association's Committee on Educational Policy (on which each school of nursing and the British Columbia Hospitals' Association have representation) and by the Government Committee on Nursing Service. During the past five years the Association has periodically discussed with the Honorable Minister of Health the great need for implementation of clause 29 of the Registered Nurses' Act which reads: " The Lieutenant-Governor in Council may make regulations governing the hours of duty for student nurses in schools of nursing." We believe that the cost of decreasing the students' hours of duty from 48 hours to 44 hours per week (the major change proposed and one which would necessitate additional graduate staff) has been the reason no action has been taken. We therefore strongly urge that monetary consideration not be permitted to postpone implementation of this clause, in line with the recommendations made by the Association. In reviewing the subject of hours of work for student nurses, the Board learned that at the Regina General Hospital, where there is a training-school for nurses with an enrolment of 215 students, a forty-four-hour work-week is in force, with a three-week vacation, plus statutory holidays. The Board therefore recommends that the request of the Registered Nurses' Association of British Columbia with reference to hours of work of student nurses be given favourable consideration. No. 44.—RESPONSIBILITY FOR HOSPITAL ACCOUNTS OF EVADERS The Board has elsewhere recommended that, subject to certain conditions, a registrant under B.C.H.I.S. shall be entitled to the benefits thereof in any benefit period for which he has paid the current premium; and, further, the Board has recommended that the arrears of premiums for which any person is liable shall cover only a certain fixed and definite period prior to his original registration. The Board has further recommended that the collection or realization of such arrears shall be the responsibility of a special department of B.C.H.I.S. The Board has also suggested and recommended certain improved methods and procedures by which it is hoped that a maximum percentage of the population of the Province will be registered and covered under the Act and regulations. It is nevertheless recognized that there will be some small percentage of evaders of the scheme still in existence, and it is further recognized that from time to time some of these evaders will enter the hospitals of the Province for acute or general treatment. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 73 The Board believes that, under a scheme made compulsory by Provincial legislation, such evaders are not the final responsibility of local hospital authorities in any way. Many representations have been made to this effect by individual hospitals. These are too numerous to be quoted here, but the whole sense of the matter may be considered to be covered by the following remarks found in the brief of the British Columbia Hospitals' Association:— Failure to cover all persons liable to pay premiums has created one of the most expensive and difficult problems now facing both B.C.H.I.S. and the hospitals, namely, identification of persons entitled to hospitalization under the plan. If all liable persons were covered, it would only be necessary for the hospital to prove residence and length of residence. Being in agreement with the reasoning behind these representations— The Board now recommends that, since the collection of premiums under the " Hospital Insurance Act" is the function of the B.C.H.I.S., then the final responsibility for the collection or coverage of any hospital accounts incurred by evaders of the provisions of the Act is for the Service to assume, and that such a policy should be definitely adopted, but nevertheless the hospital board or administration concerned shall initiate and exhaust all reasonable steps in their endeavours to collect the said accounts from the patient or his responsible relatives in the first instance. No. 45.—ELIMINATION OF SOCIAL SECURITY AND MUNICIPAL AID TAX ON HOSPITAL SUPPLIES It has been pointed out by many hospital boards that drug supplies and hospital equipment generally are exempt from Federal sales tax of 10 per cent but the Provincial social security and municipal aid tax applies to all such items going into a hospital, except drugs that are specifically prescribed by a physician. In other words, hospital equipment and supplies such as are exempted from the Federal sales tax are assessed the Provincial tax, with this single exception. As all hospitals are non-profit institutions and as Government subsidies are made toward hospital deficits, it is suggested that exemption from the Provincial tax to the same degree as is granted in the case of the Federal tax would eliminate a lot of clerical and paper work and result in a net saving to the British Columbia Government. The Board therefore recommends that the cost of purchases made by the hospitals of the Province covering articles or supplies which are exempted from the Federal sales tax be also exempt from the imposition of the social security and municipal aid tax. No. 46.—PURCHASE OF NEW EQUIPMENT: CONSENT OF B.C.H.I.S. A somewhat minor matter which appeared to be causing concern to some hospital boards and administrators was the procedure outlined to be followed in order to secure the necessary permission from B.C.H.I.S. for the purchase of new equipment toward the cost of which a Government grant could be expected. It would appear that a capital expenditure of practically any amount for equipment which has a certain life expectancy must be first authorized by the Commissioner of B.C.H.I.S. if the hospital in question expects to receive a Government grant covering a portion of the cost. As can be understood, this procedure technically applies to items of comparatively small cost, but nevertheless essential to the hospitals concerned. In many of these cases the purchase of the required equipment is necessary on short notice, and the complaint presented to the Board was that there is undue delay in obtaining the needed permission. The hospital is required to submit a form of application showing the specifications of the article in question, the life expectancy, and the tenders received to cover its cost. In certain cases, even of expenditures of comparatively large amounts, it could (according to the hospital board or administrator) be demonstrated that the said cost would be FF 74 BRITISH COLUMBIA fully recovered in savings effected by the use of the new article, in even one operating year—and, in many cases, over a slightly longer period. In view of rising prices, and the fact that it is not always possible to get a fixed and definite tender which is not subject to upward revision, it appeared from testimony given to the Board that annoying consequences had followed the delay in granting of permission by B.C.H.I.S. As already stated, this would seem to be somewhat of a minor problem, and we find that in the larger hospitals adjacent to the centre of B.C.H.I.S. Administration, the problem has not caused any serious difficulties. Nevertheless, the Board considers that the position of the smaller and more remote institutions is worthy of note, and for this reason— The Board now recommends:— (a) That the mechanics or operation of the rules and regulations pertaining to the granting of permission to purchase new hospital equipment shall be examined with a view to eliminating the difficulties and delays so far encountered, and thereby remove the cause for any complaint in the future: (b) That purchases by the hospitals of such new equipment not having a cost value higher than $100 be made permissible without the prior consent of the B.C.H.I.S. Administration having to be obtained. No. 47.—CENTRAL PURCHASING AGENCIES Practically all submissions made to the Board showed a keen general interest in rapidly rising costs of operating hospitals, and there was a genuine desire expressed to contribute suggestions that would help to counteract this tendency. A suggestion that came from many quarters was that central purchasing on some plan be resorted to by the hospitals of the Province. A study of the matter revealed to the Board that such a policy was fraught with some difficulty, but, nevertheless, it is believed that it holds great possibilities. Certain items, no doubt, could be purchased collectively on behalf of all hospitals in the Province, whereas in some cases this would be impractical. In the latter case, pool-purchasing would only be possible by smaller groups of hospitals located in particular zones throughout the Province. The Board has ascertained that the system of pool-purchasing of supplies, etc., for hospitals has been found to be successful in certain cities, with special reference to the City of Cleveland, Ohio, and also that plans are being laid to inaugurate a system of pool-purchasing on a regional basis for the hospitals in the Province of Saskatchewan. Mr. Cox, Assistant Commissioner of B.C.H.I.S., in discussing this matter with the Board, stated that he had continually urged hospitals to try some measure of pool- purchasing, at least in different zones. He believed they could perform a good service. He said individual hospital administrators in many cases did not know the mechanics of good purchasing. The Board therefore recommends that B.C.H.I.S. encourage hospitals to develop, to the greatest extent possible, a system of bulk centralized purchasing of supplies. No. 48.—DISPENSING OF DRUGS The matter of dispensing of drugs in hospitals was reviewed in great detail by the Pharmaceutical Association of the Province of British Columbia. The highlights of their submission in this regard are as follows:— The Pharmacy Act of the Province of British Columbia was passed on March 3, 1891. It is obvious, even from the date of this earlier legislation, that the Act was intended for the protection of the health of the public. It was designed to see that the persons who were dispensing medicines for the public in drug-stores throughout the province should only be REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 75 persons who had adequate training and technical and professional knowledge to enable them to discharge these duties in a careful, efficient and capable manner. Conditions have changed throughout the years and, even before the advent of the B.C. Hospital Insurance Service, persons were entering hospitals for treatment for many diseases which in former years were treated at home. At the same time, medical and pharmaceutical research was proceeding apace and new therapeutic discoveries were made. Today, more than ever before, the compounding and dispensing of prescriptions calls for a very high standard of professional skill and knowledge which is reflected in the extension of pharmaceutical training across Canada through practical experience under the College of Pharmacy to a five-year course. As the Pharmacy Act exists and has been passed by the legislature of British Columbia, and of all other provinces across Canada, for the protection of the public, it is but logical that under a hospital insurance scheme, sponsored and directed by the Government, the same margin of protection for the health of the public in regard to the dispensing of prescriptions by competent and trained personnel must be afforded. The Pharmaceutical Association of British Columbia embraces every pharmaceutical chemist in the province of British Columbia and licences under the authority of the Pharmacy Act all retail pharmacy and hospital dispensaries operating in British Columbia. The Association is entrusted by the Government with the responsibility for maintaining the high standards of service for such establishments as are established under the authority of the Pharmacy Act. The Association is one of the most democratic in Canada in that all employers and employees have an equal vote in the affairs and administration of the Association. The principle that pharmacists should handle the dispensing of prescriptions has been approved under the British scheme, by the Canadian Government, and by our own British Columbia Government. The situation in British Columbia since the advent of hospital insurance has become steadily worse from the standpoint of protecting the health of the public in regard to the dispensing of drugs in hospitals. The reasons for this situation are undoubtedly economic. In the first place it is now quite apparent that innumerable hospital boards, in determining their per-patient per-day rate for submission to the Hospital Insurance Commission, did not include drugs in their estimated costs. To overcome this situation, many of these smaller hospitals, and some larger hospitals of 100 beds or more, operating without a dispensary, have started the purchasing of increasing quantities of drugs from manufacturers and wholesalers, and these drugs are being dispensed for patients in the hospitals by nurses and other persons who are not qualified, either by training or through legal standing, for the dispensing of such drugs. The development of this practice is seriously endangering the lives of patients in hospitals. A number of minor accidents have already occurred, and a serious accident may take place at any time. It would appear that there has been a tendency on the part of the Hospital Insurance Commission to condone this situation in view of the alleged economy in operations. In actual practice it is extremely doubtful that any real economies are effected. The buying of pharmaceuticals for a dispensary or hospital is a very complicated problem, requiring professional knowledge. There are an enormous number of duplications and a matron, or nurse, or other unqualified persons, doing the buying of pharmaceuticals and drugs for hospitals, may pile up a very considerable stock, which would not be necessary if some person with the proper skill and knowledge was handling the actual buying. In addition, many pharmaceutical preparations go bad in a short period of time, and knowledge of the proper storage and the length of time which quantities of certain drugs can be stored is essential in order to maintain these drugs in their full strength, and to be sure that when used in dispensing, they have their full therapeutic efficiency. Numerous pharmacists have reported to this office that they have on occasions been called in by the local hospitals to advise them regarding a large accumulation of drugs. In many cases these pharmacists state they had found the drugs had been in stock so long they were useless and they have consequently been destroyed by the matron on the advice of the pharmacist concerned. It has been suggested that every hospital in British Columbia should have a pharmacist. In actual practice this does not seem possible. However, it would seem essential that the B.C. Hospital Insurance Commission should accept the responsibility for seeing that drugs are dispensed to patients in hospitals under legal conditions and in compliance with the regulations of the province, and of Canada. The subject of hospital insurance is receiving increasing study from pharmacists, and the College of Pharmacy of the University of British Columbia is now preparing a post-graduate course, which will give particular instructions to those interested in the development of this field of pharmacy. In the Province of Saskatchewan, a plan has been worked out whereby hospitals under 100 beds can make an arrangement with the local pharmacist, and he will purchase their stock of what is described as ward stocks in the name of the hospital, thereby securing the benefit of exclusion of the 10 per cent Sales Tax, granted on hospital purchases by the Federal Government, and at the same time taking advantage of quantity prices and lower quotations, extended by manufac- FF 76 BRITISH COLUMBIA turers to the hospitals. While thus buying, in the name of the hospital, drugs which are used in larger quantities by the hospital, these pharmacists handle the actual preparation and control of the stock of such drugs as are turned over to the wards of the hospital, and other prescriptions which have to be individually compounded or dispensed on a scale or prescription basis in their own drug-stores for the patients in such hospitals. This scheme has worked out satisfactorily in Saskatchewan, and has permitted the compliance with the requirements of the Pharmacy Act there; maintained a high standard of pharmaceutical service for the patients; and resulted in definite economy in hospital operations. In one of the largest hospitals in British Columbia it has been found that through the efficient operating of a committee composed of representatives of every group of specialists in the professions, it has been more economical to eliminate duplications there and to permit free supply of all drugs to patients in that hospital. In effect this arrangement has made it possible to avoid carrying possibly a dozen or more competitive brands of pharmaceuticals, thereby reducing the overhead of the hospital. It is also maintained that if it were necessary to keep separate records and to bill hospital patients for some drugs, while supplying others free, it would greatly increase the overhead of the dispensary, as it would involve charging for these drugs on a basis of retail prices instead of the cost-plus-time basis which is in effect under the more embracive scheme. While such an arrangement as this, we have been assured, can be worked out with the utmost economy in a larger hospital, it would seem that the publication of an enlarged B.C. Formulary would provide the solution in the smaller hospitals. It has been found under the Medical Assistance Branch of the Department of Health and Welfare, that our present Formulary is inadequate, and a large number of additional items have been included. In fact the scheme is now so broad that almost anything within reason, which is ordered by a doctor and can be justified by the medical director of the scheme, is approved. A joint committee of the B.C. Medical Association and the B.C. Pharmaceutical Association has been at work for many months on the preparation of a new edition of the B.C. Formulary, which should go a long way to solve many of the problems involved in hospital dispensing at the present time. In connection with the employment of pharmacists in hospitals, there is no doubt that even smaller hospitals could, under many circumstances, employ a pharmacist profitably. The following are but a few suggestions which have been supplied by hospital pharmacists in this connection: 1. Besides their duties of dispensing prescriptions and supplying and keeping records of medicines used in different ways, a pharmacist in a smaller hospital can improve on procedures and techniques used in laboratories, and arrangement and preparation of stock preparations. 2. Advise the physician which type of medication will be most economical for treatment to long-term patients (cancer patients, control of pain, etc.). 3. Assisting or taking care of purchases of supplies or equipment for the hospital. 4. Keep physicians, internes, and, to some degree, nurses posted on the latest information on new pharmaceuticals. 5. Use his knowledge along research lines and in many cases possibly develop new methods and improved equipment which will result in economies. 6. In some cases, he could act as hospital accountant and also keep hospital records. There are possibly many other points that will occur. I think one of the most important is the fact that by his knowledge a pharmacist in a hospital may be in a position to supply some effective medication which will reduce the time of the stay of the patient in the hospital, thus effecting economies in the per-patient cost and making a larger number of beds available more quickly, and by eliminating the necessity for increasing the hospital overhead by the provision of additional beds. It is quite evident that the present situation in regard to the steady increase of indiscriminate dispensing of drugs in hospitals cannot continue without serious consequences. Hospitals themselves cannot expect to collect on public liability insurance where dispensing, resulting in an accident, is the consequence of a deliberate violation of the laws of the province. Hospitals at the present time have no other revenue than from the government, and any extensive litigation would be directly reflected in the expenses which the government would be called on to pay in connection with hospital operations. At the same time the B.C. Pharmaceutical Association, entrusted as it is with the responsibility for the health of the public, cannot sit by indefinitely and see the practice of dispensing prescriptions by unauthorized persons continuing to increase in hospitals throughout the province. It is apparent to the Board that the recommendations of the Pharmaceutical Association of the Province of British Columbia are soundly based— And the Board therefore recommends that all dispensing of drugs in hospitals, or for hospital patients, should be done by registered pharmacists or qualified physicians. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 77 No. 49.—CHRONIC CASES (SOCIAL WELFARE) REMAINING IN HOSPITAL A great deal of attention was drawn by various organizations and individuals to another phase of the general subject of hospitalization of chronic cases. It is an admitted fact that where a case has been ruled chronic, a patient cannot, in many instances, be quickly removed from the general hospital because of the fact that no suitable place is available to which he might be transferred. The Board has dealt with the extension of the liability of B.C.H.I.S. for cases which do not come as a responsibility of the Social Welfare Branch. There remains, therefore, a consideration of the position of the general hospital in numerous cases, where such persons who are the responsibility of the Social Welfare Branch are concerned. It has apparently not been the custom of the Social Welfare Department to accept any liability for costs incurred in the time elapsing before the chronic patient is removed from the general hospital. In the meantime, B.C.H.I.S. has terminated its liability, with the result that the hospital has been providing facilities and treatment in many cases, with no source from which to collect the cost thereof. Arising out of this situation, it was pointed out that in some hospitals in the Province where the bed occupancy is not overtaxed, it is quite possible for the said hospitals to retain these patients without adversely affecting the admittance of acute cases, and thereby relieve the urgency of the demands on the Social Welfare Department to remove the said patient. While the Board does not consider it desirable to recommend any policy which would encourage the utilization of hospital beds ordinarily intended for acute cases by such chronic cases, they are nevertheless confronted with certain conditions existing at the present time, and in view of these— The Board therefore recommends that where B.C.H.I.S. acknowledges that there is a surplus of beds in any general hospital, and the board of the hospital affected comes to an amicable agreement with the Social Welfare Branch to accept chronic cases at a certain rate differing from the fixed per diem rate approved by B.C.H.I.S., the consent of B.C.H.I.S. be given. The policy enunciated by the foregoing is predicated on the assumption that the beds so acknowledged to be surplus may be set apart for the use of chronic or convalescent cases, and will remain in that classification until the entire bed situation of the hospital concerned is reviewed by the hospital administration and B.C.H.I.S. No. 50.—GENERAL RELATIONS WITH B.C.H.I.S. The success of our Hospital Insurance Service is dependent on the establishment of good relations with those who play a part in rendering hospital service. There is no class of people who are in a more important position in this respect than the hospital boards and administrators. It is therefore essential that negotiations, correspondence, and all relations between B.C.H.I.S. and the hospitals should be on a most harmonious plane. We have learned that this fact is appreciated by the Commissioner, and some headway has been made in establishing an over-all co-operative relationship with hospitals. However, shortages of personnel and other difficulties related to the embryo stage of the whole service are responsible for a serious lack of accomplishment in this direction. The average hospital needs counsel and advice on many matters, including administration, purchasing, dietary, and other phases of hospital operation. Improved conditions in the operation of the hospital will result in economies which will reflect in the budget, and we feel sure that a reasonable expenditure in this field of service to hospitals will be amply repaid. To express the opinion of a representative hospital in regard to this matter, we quote from a submission to the Board from the Vancouver General Hospital, as follows:— FF 78 BRITISH COLUMBIA It is our feeling that closer co-operation between the B.C. Hospital Insurance Service and the Administration of the hospitals would assist in breaking up a great many of the problems we have mentioned in our brief. We know that the B.C. Hospital Insurance Service has the problems of the hospitals at heart and, now that the first pressure of getting the plan under way is over, we believe the time is opportune for representatives of the B.C. Hospital Insurance Service and the hospitals to sit down and work out the remaining problems. Recommendation: That a procedure be established whereby representation of the Boards of the hospitals could confer with representatives of the B.C. Hospital Insurance Service to discuss problems. The Board therefore recommends that the B.C.H.I.S. round out, as soon as possible, a complete organization of specialists in the various phases of hospital operation and management, to the end that they may render maximum assistance to hospitals and receive full co-operation in return. No. 51.—HOSPITAL CONSTRUCTION AND EXTENSION, ETC.: STUDY OF NEEDS AND PROVISION FOR HOSPITAL IMPROVEMENT DISTRICTS Under the terms of reference set out in the Act authorizing an inquiry into the " Hospital Insurance Act" and its administration, clause (c) of section 5 specifically gave the Board power to investigate the matter of hospital-construction. The Board regrets that time has not permitted this particular phase of its commission to be carried out in anything like a completed manner, and the subject must therefore be dealt with in this Report in somewhat general terms. The conclusions arrived at by the Board are set out as follows:— (1) Due to the rapid growth of population and industry, the Province is in urgent need of some new and additional construction of both acute or general hospitals and chronic or convalescent institutions. (2) In view of the urgent need, it is suggested by the Board that there should be, at the earliest possible date, a very intensive study of the present needs, the advantages to be derived from a zoning scheme to cover the hospital facilities of the Province, and with particular reference to the debatable question of centralization or decentralization; and that this study should also definitely go into the nature of, and the best place in which the provision of, additional accommodation for chronic and convalescent cases may be provided; and, further, that the best advice should be secured on the controversial subject of the percentage of private, semi- private, and public wards in general- and acute-hospital construction. The Board further suggests that the main stumbling-block to proceeding at a satisfactory pace to meet the demand existing for extended hospital facilities is the lack of proper legislation which will outline the responsibilities of various departments of Government. It would appear essential, for instance, to provide by law that all municipal governments shall take their full share of responsibility in this connection. It would further appear desirable to provide a legal plan by which action may be speedily, simply, and efficiently taken in cases where more than one municipality or department of government is concerned. The Board is of the opinion that the amendments to the " Water Act," passed by the 1951 Session of the Legislature, which were intended to help in this connection, have proven by subsequent experience to be unsatisfactory and inadequate. The Board has become acquainted with the " Union Hospitals Act" of Saskatchewan. The evidence is that this Act, which was instituted in 1916 and is, therefore, not new legislation, has, during the years since 1939 (and more particularly since 1945), worked in a very satisfactory manner. The provisions are simple and straightforward, and the responsibilities of all concerned are clearly defined. It is suggested, therefore, by the Board that a new Act be provided for the Province of British Columbia, to be known specifically REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 79 as the " Hospital District Improvement Act," which will follow very much along the lines of the " Union Hospitals Act" of Saskatchewan; and that upon its adoption the provisions now in force, particularly those having to do with the " Water Act," shall be rescinded. Before leaving this suggestion of increased or expanded hospital facilities, the Board wishes to state that it has studied, with a very considerable degree of interest, plans for the establishment of health units within the Province, under the control of the Department of Health and Welfare, of which the first full unit is now operating in the Vernon area. The information available in this connection leads the Board to believe that the intended services in these health units will, no doubt, in time be of great benefit to the Province, and that the results thereof will be sufficient to cause an appreciable lightening of the burden placed upon hospitals by overoccupancy and undue length of stay. The Board further would say that it has had called to its attention other developments of home-care treatment which have taken place, particularly in the United States. It would appear that this development probably originated from plans similar to the one now being tried in the health units of the Province. In this connection, attention is particularly called to the home-care programme of the Montefiore Hospital of New York City, which was commenced on January 1st, 1947, and which, before the end of 1949 (according to material studied by the Board), had definitely proved its worth and effected savings in the net total of hospitalization costs. Dealing with the allied phases of hospital construction and service, we would here bring to notice a paragraph from the brief submitted to the Board by the Registered Nurses' Association of British Columbia, which is concurred in by this Board:— Standards under which hospital construction grants are made available to hospitals are a responsibility of the Hospital Insurance Service and we assume that the Service will carry similar responsibility in respect to grants-in-aid for schools of nursing. We urge that standards in regard to facilities for instruction, residence and recreation be developed in collaboration with representatives of the Registered Nurses' Association. The Board now recommends that a more intensive study of the whole matter of hospital construction than was possible in the limited time available to the Board be made; and It is further recommended that this study be proceeded with as soon as possible. // is further recommended that new legislation be enacted, similar to the " Union Hospitals Act" of the Province of Saskatchewan referred to in the preamble to this recommendation, which will enable the setting-up of hospital improvement districts in the Province of British Columbia. FF 80 BRITISH COLUMBIA The Board wishes to record a high tribute to our Secretary, Mr. Maurice Hesford, F.C.A. His devoted interest, sincere loyalty and broad experience has been of invaluable assistance to us in our task. We also wish to express our sincere thanks to all other members of our staff for their efficient service. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 81 All of which we respectfully submit. S. J. SMITH, Chairman. DON. C. BROWN. WALTER HENDRICKS. A. W. LUNDELL. D. J. PROUDFOOT. R. C. STEELE. H. J. WELCH. HAROLD E. WINCH. Maurice Hesford, Secretary. February, 1952. FF 82 BRITISH COLUMBIA SECTION 6.—APPENDICES SUMMARY OF RECOMMENDATIONS OF THE BOARD 1. Completion of Unfinished Survey and Study.—That the time for submitting its final report be extended so that Messrs. Stevenson and Kellogg Limited may be enabled to complete their survey, after which the Board may proceed with a combined study of the two reports referred to before filing the final report of this Hospital Insurance Inquiry Board with the Minister of Health and Welfare. 2. Continuation of Hospital Insurance Service (Basic Plan).—That the B.C.H.I.S. shall continue to follow the present plan as referred to in Approach No. 1 of the Eckler Report, subject only to the recommendations contained in this Report of the Board, until this Board is in a position to file its final report. 3. Premium Rates.—That at present there shall be no increase in the premium rates. 4. Co-insurance Charges.—That co-insurance charges against patients in hospitals be completely abandoned. 5. Financing Over-all Deficits of Plan.—That a long-range programme of financing the Service be developed, with a definite policy and formula of Government financial support, and that there be established a policy that should a deficit develop in the hospital insurance financial year for reasons over which the hospitals and B.C.H.I.S. had no control or which could not reasonably be foreseen by B.C.H.I.S. or the Government, then the said deficits shall be paid from consolidated revenue. 6. Municipal and Provincial per Diem Grants.—(1) That the per diem contribution paid by municipalities or by the Government, in the case of unorganized territories, shall be increased from the present basis of 70 cents per patient-day to the sum of $1 per patient-day. (2) That consideration be given to basing the contribution mentioned above on a per capita basis rather than the present per patient-day basis, with the per capita rate thereof being set to produce an approximately equal amount of revenue to the Service. (3) That where a resident of a municipality or of an unorganized territory is hospitalized in a hospital outside the confines of his own municipality or territory, the said municipality, or the Government on behalf of the unorganized territory, shall pay an additional 25 cents per patient-day in connection with such patients. This additional payment shall be made direct to the hospital in question, to be treated as non-operating revenue of the receiving hospital, and the hospital concerned shall be required to bill the proper authority for this additional 25 cents per patient-day charge. 7. Future Increase of Premium Rates or Curtailment of Benefits.—That there shall be no further or future increase in the premiums required to be paid annually, and no reduction of benefits conferred by the Act within any premium-year; and that any such changes as may be, from time to time, authorized by Act of the Legislature, affecting the annual premium payments or the benefits conferred by the " Hospital Insurance Act," shall have effect only at the commencement of the next premium-year. 8. Exemption of Groups on Religious Grounds.—That in future no group of citizens of the Province be exempted from the provisions of the " Hospital Insurance Act" on religious grounds, and that the present exemption extended to members of the Christian Science Church shall be discontinued. 9. Exemption of Groups: Canadian Pacific Medical Association of British Columbia and Telephone Employees' Medical Services Association of British Columbia.—That the position of the present exempted groups referred to above shall be reviewed by competent authority as soon as possible, with a view to bringing the members of such groups directly within the operations of the B.C.H.I.S. at such a time as it may be found feasible and advisable to so do. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 83 10. Exemption from Premium Liability: Low-income Groups.—That in the case of persons not otherwise exempted from the personal payment of premiums and who can establish that their income is not more than $720 for the year in the case of a single person or $1,200 for the year in the case of a married person, the said persons shall be exempted from personal payment of the premium, but that the proper premiums for them shall be paid to B.C.H.I.S. by the proper Government department. 11. Exemption from Premium Liability: Student Nurses under 21.—That student nurses, not over the age of 21 years, be recognized as dependents in the same manner as those persons presently covered by subsection (d) of section 1 of Regulation 1, under which dependents are defined. 12. Benefits: Out-of-Province Hospitalization. — That when a registrant under B.C.H.I.S., or his dependent, in good standing, is compelled by circumstances beyond his control, or on the definite advice of his physician in British Columbia, to take hospital treatment outside the confines of the Province (more particularly when the home of the patient is so geographically located as to make the out-of-Province hospitalization necessary or desirable), B.C.H.I.S. shall pay for the said hospitalization a rate of $6.50 for each patient-day up to a limit of thirty days, plus a maximum of 50 per cent of the cost of all extras which would be covered completely by B.C.H.I.S. if the treatment was in a hospital in the Province. 13. Benefits: Out-patient Services.—That careful study be given as soon as possible to the question of benefits having to do with out-patient services of hospitals, with a view to setting up the most desirable scheme from the view-point of service and the insured public; and that changes as decided upon be put into effect in the Province. 14. Charges for Non-elective Use of Private and Semi-private Wards.—That in the case of non-elective use of private- or semi-private-ward accommodation in hospitals within the Province, there be no extra charge to B.C.H.I.S. registrants for the said accommodation. 15. Premiums Payable by Wives of Certain Veterans.—That in the case of married war veterans who are themselves completely covered for hospitalization by the provisions or regulations of the Department of Veterans' Affairs at the time being in force, the premium required to be paid by, or for, his wife (in case the family income is over $1,200 per annum) shall be the premium of a single person. 16. Hospitalization of Treaty Indians—Federal Government Responsibility.—That arrangements be made with the proper department of the Government of Canada for payment by it of the total cost of hospitalization of Treaty Indians of British Columbia. 17. Payment for Hospitalization of " Social Aid " Cases.—That these persons comprising the groups of Health and Welfare cases referred to above be no longer accepted by the Service on an ordinary premium basis, but that the responsible Government department—namely, the Department of Health and Welfare—pay the full cost of hospitalization of all such persons coming within these groups, such payments to be made to the B.C.H.I.S. 18. Educational Grants-in-Aid to Cost of Operation of Training-schools for Nurses.—That training-schools for nurses, in conjunction with hospitals within the Province, be considered as educational institutions in so far as it is necessary to enable them to come within the provisions for grants-in-aid from the Department of Education, to the end that the net cost of operating such training-schools shall in no way be a part of, or taken into account as, an operating cost to be covered by B.C.H.I.S. 19. Chronic Cases: Limit of B.C.H.I.S. Liability.—-That the liability of B.C.H.I.S. for an account in a general hospital incurred by a patient who is a registrant, or dependent of a registrant, in good standing under the Act, who has been declared to be a chronic case, shall continue until they have been otherwise placed, but in no case shall it continue more than sixty days beyond the effective date at which the case has been ruled otherwise to be a chronic case. The ruling referred to is the decision of the FF 84 BRITISH COLUMBIA Medical Board of Review, if the diagnosis has been referred to them; and this recommendation is intended to apply to cases remaining in hospital which do not become the responsibility of the Social Welfare Department. 20. B.C.H.I.S. Management Board and Select Standing Committee.—That B.C.H.I.S. be administered by a board of three members, without legislative or judicial powers, and also that Standing Orders of the Legislature be amended to provide for the appointment of a Select Standing Committee on Hospital Insurance, which shall meet at each regular session of the Legislature and shall review the report of the B.C.H.I.S., meet with the board of management, and report to the Legislature. 21. Hospital Advisory Council.—(1) That the broad intention behind the setting-up of the Hospital Advisory Council be fully realized, and that if full advantage is not now being taken of the services of the Council, steps be taken to realize the maximum benefit therefrom; and that, further, all proposed important changes in policy or regulations be discussed with the said Advisory Council before the proposed changes are put into effect. (2) That the Hospital Advisory Council shall in future include in its membership two private members of the Provincial Legislature, to be appointed or named before each regular session of the Legislature is prorogued, and that the said private members shall be selected from the membership of the Select Standing Committee which has been in existence during the said regular session, one to represent the Government and one to represent the Official Opposition. 22. Public Relations of the Service.—That, as it is their opinion that the scope of the public relations of the B.C.H.I.S. justifies the retention of a Director of Public Relations of outstanding ability, steps be taken to secure the services of such a person, and that responsibility for the public relations of the Service be placed in his hands as soon as possible. 23. Field Representatives of B.C.H.I.S.—That the present force of district representatives be enlarged to an extent necessary for them to take care of problems as outlined herein without undue delay; and, further, that the personnel of this field force be given proper training to fit them to act as " top-notch " public-relations officers. 24. Exempted Areas.—That the necessary amendments be enacted to exempt all persons in the areas referred to, but that the privilege of voluntary registration and participation under the " Hospital Insurance Act " be extended to them. 25. Annual Accounts of B.C.H.I.S.—That it seems highly desirable to have the annual accounts of B.C.H.I.S. prepared on a revenue and expenditure basis for each full year of its operation, rather than on a cash receipts and payments basis running to March 31st only, and that publication thereof should be made as early as possible in a manner clearly understandable to the general public. 26. Premium-year.—That as soon as can effectively be done, the premium-year be from April 1st to March 31st. 27. "Chronic" Diagnosis: Provisions for Review.—(1) That where it is decided that a patient in an acute or general hospital is ruled to be, or to have become, a chronic case, and not the responsibility of B.C.H.I.S., advance notice of the discontinuance of benefits shall be given in every case; and the effect of such ruling shall in no case be retroactive. (2) Before such ruling is made, any and all cases should be referred, wherever possible, to the medical staff of the hospital, whose opinion shall be fully considered by the medical consultant or Administration of B.C.H.I.S. (3) In all cases of difference or dispute arising at any point as to the correctness of the diagnostic decision, the final decision should be left to a Medical Review Board, consisting of two representatives of B.C.H.I.S. and three doctors appointed by the College of Physicians and Surgeons. (4) That provision be made for the appointment of the said Medical Review Board as soon as possible. .: ™ ' , ? --.:—-< ™ ™ REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 85 28. Provision for Permissive Use of Special Drugs.—That the Medical Board of Review, if established, shall have the authority to allow the use of special drugs for hospital patients, when vitally necessary, on the recommendation of the local medical authority. 29. Premium-payment Enforcement: Prosecutions and Garnishee Proceedings.— (1) That the competent authority shall call to the attention of the Magistrates and Justices of the Province the provisions of subsection (2) of section 11 of the Act as referred to above, and shall require their future compliance therewith. (2) That the Administration of B.C.H.I.S. shall take full advantage of the provisions of section 11b of the Act when such action is justified by circumstances. (3) That the application of section 11b shall be widened so as to permit the procedure of automatic garnishee by the Administration of B.C.H.I.S. of any sums owing by a delinquent registrant (or person required to be a registrant under the " Hospital Insurance Act"), provided that such extension is ruled by competent authority to be possible. 30. Plan of Registration and Premium Collection.—That Plan No. 2 of registration of beneficiaries and premium collection as outlined above be adopted in its entirety at the earliest possible date, and that the necessary enactments be made to define the duties of the persons therein referred to and the proper penalties for failure to comply with the provisions thereof; and that the said plan be given a fair trial over a predetermined period, at the end of which period the position shall be reviewed, and if the response of the persons required by the Act to become registered and to pay premiums is not such as to have achieved the desired and intended results, then consideration shall be given to the necessity of introducing a plan such as the other plan referred to in this section. 31. Proof of Standing Under the Act (to be required from applicants for any Provincial (annual) licence).—(1) That the necessary legislation be enacted to require that any issuer of an annual licence on behalf of the Province of British Columbia shall, at the time of issuance thereof, ascertain the registration number or exemption certificate number of the licensee in all cases where such licensee is required to be covered by the " Hospital Insurance Act"; and that if the said licence-issuer is unable to obtain the necessary evidence of standing under the said Act, he shall thereupon forthwith report the name and address of the licensee concerned to the B.C.H.I.S., whose duty it shall be to ascertain that all such licensees are properly registered under the Act. It is also recommended that the Administration of B.C.H.I.S. shall seek the co-operation of issuers of municipal licences within the Province, with a view to having the same procedure followed by such officers. Or, alternatively— (2) That any person who is subject to registration under the " Hospital Insurance Act," when applying for the issuance of any annual Provincial licence within the Province of British Columbia, shall produce his official eligibility certificate, certified interim receipt (current period), or exemption certificate proving his good standing under the " Hospital Insurance Act" and regulations, and in default of the production of such evidence of good standing shall not be entitled to the issuance to him of any such licence. 32. Limit of Liability for Premium Arrears.—That, effective not later than July 1st, 1952, a person becoming registered under the Act, or having been registered, seeking to place himself in good standing, shall be required to pay a sum equal to the premium for the current year as regularly provided, and the arrears for the previous premium-year if he is liable for the same. The provisions of this recommendation are intended in no way to interfere with the powers of the Minister or the Commissioner to reduce the amount of, or to suspend indefinitely payment of, arrears owing by any person. 33. Collection of Arrears of Premiums.—That the collection or realization of the amounts which will from this time on be recognized as arrears, and kept on the books and in the accounts of the Service, be a matter for handling by a special collection FF 86 BRITISH COLUMBIA department of the B.C.H.I.S. Administration, to be segregated completely from the records of current premium payments and the receipts and collection thereof. The term " arrears," as used in this recommendation, would not be intended to mean the late payment of the premium for the current benefit period, but those arrears defined in Recommendation No. 32. 34. Exemption Cards: Issue to Certain Persons and Charge Therefor.—That all adult residents of the Province coming within the provisions of the " Hospital Insurance Act " who are, by reason of special exemption or otherwise, not required to personally pay a premium in accordance with the regulations shall nevertheless be required to obtain from B.C.H.I.S. an official exemption card or certificate covering each premium-year or benefit period, as the case may be, and to pay a charge for the said card or certificate amounting to $2 per annum. This requirement shall not apply to the following persons mentioned in section 8 of the " Hospital Insurance Act ":— (1) Those persons mentioned in section 8, subsection (1) (a), to whom the Government of Canada provides hospital benefits: (2) Those persons mentioned in section 8, subsection (1) (c), who are covered by " Canada Shipping Act, 1934 ": (3) Those persons mentioned in section 8, subsection (1) (d), who are employees of the Government of Canada, or the government of any other country: (4) Those persons mentioned in section 8, subsection (1) (/), who are residing in exempted areas: (5) Those persons mentioned in section 8, subsection (1) (g), who are covered by the " Saskatchewan Hospitalization Act, 1948 ": (6) Those persons mentioned in section 8, subsection (3), who are inmates of Provincial institutions, gaols, or penitentiaries. 35. Changes of Status.—That the Act or regulations shall be amended to provide that there shall be no change in the status of any beneficiary of B.C.H.I.S. which would affect his standing under the Act in any way whatsoever during any current half-year period for which the necessary premium has been paid, but any and all such changes shall have effect only at the beginning of the next half-year period after the date at which a change of status did, in fact, take place. 36. Elimination of Certain Group Records.—That all individuals exempted from the requirements of the " Hospital Insurance Act," whether comprising the membership of the two groups specifically exempted by the Act or being in another category, shall receive an exemption card for every benefit period, or a permanent exemption card, wherever possible, and that the separate group records now being kept by B.C.H.I.S. shall be eliminated. 37. Pamphlet Covering Plan and Benefits.—That a pamphlet with details of the plan and benefits, and similar in form to the Saskatchewan Hospital Services Plan pamphlet, entitled " What's Your Question? " should be sent out with all notices of premiums due, and that it be obtained in sufficiently large quantities as will reduce the cost to a minimum and permit it to be used for general distribution. 38. Budgets and the "Fixed" Budget System.—(1) That the budgets of the hospitals of the Province, when submitted to B.C.H.I.S., must include therein all the anticipated costs of efficient operation, and if the B.C.H.I.S. Administration, upon examination of any budgets so submitted, disagrees with the figures submitted, they shall make prompt arrangements for consultation with the hospital board concerned so that adjustments may be studied and considered; and only after such consultation shall the figures then agreed upon become a " fixed " budget. (2) Such " fixed " budget, nevertheless, still remains subject to agreed changes arising as the effect of circumstances over which the hospital board has no control. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 87 (3) There shall be no reduction of a per diem rate set by B.C.H.I.S. and existing in any hospital, made effective until the time when the new budget of the said hospital is fully agreed upon for the year in accordance with clause (1) hereof. (4) That at the commencement of each year the " other agencies " shall be notified by B.C.H.I.S. that accounts rendered to them for hospitalization for which they are liable are on an interim basis until the hospital budgets and rates are fixed for the year by B.C.H.I.S., and that such accounts are thereafter subject to increase or decrease in accordance with the new rates set. 39. "Fixed Charges" in Hospital Budgets.—(1) That in the case of hospital equipment, full depreciation allowance, in accordance with the classification thereof, shall be permitted as an annual operating cost in hospital budgets, in order to cover equipment replacement; and (2) That the entire question of allowances for depreciation on buildings and carrying charges on capital debts, which are the responsibility of the hospital board, shall be the subject of serious study by the Administration of B.C.H.I.S. at the very earliest possible date, with a view to a more satisfactory agreement being reached concerning these charges between the Hospital Boards and the B.C.H.I.S. 40. System of Payments by B.C.H.I.S. to Hospitals.—That the system of B.C.H.I.S. payments to hospitals be reviewed, with the object of arriving at a more satisfactory plan; and the Board is of the opinion that the system in use in Saskatchewan should be followed, unless specific and valid reasons exist in favour of some other system. 41. Comparative Costs of Hospitalization.—That the Administration of B.C.H.I.S. shall arrange, at as early a date as possible, for adequate and full conference with the executive of the British Columbia Hospitals' Association and other interested parties, with a view to giving intensive' study to the matters referred to above, and to arrive at conclusions as to whether or not the comparative position of the hospitals of the Province is sufficiently justified. 42. Employees' Wage Agreements.—That because of the evidence of a great deal of dissatisfaction on the part of the hospital boards of the Province and the employees thereof, as represented by their bargaining agents, with the attitude and actions of B.C.H.I.S. concerning wage agreements, and because the Board believes it is not the function of B.C.H.I.S. to interfere directly or indirectly in the matter of wage negotiations, an early conference of all interested parties be held—namely, the hospital boards or Hospitals' Association, the hospital employees or their bargaining agents, and representatives of the Department of Labour—in which conference the Administration of B.C.H.I.S. shall take no part. And, further, that the Board point to the agreements which have been arrived at and are now in force with policemen's and firemen's organizations in various parts of the Province, as forming a possibly acceptable solution on which to base a permanent policy as regards hospital employees and the terms of their employment. It is intended that the aforementioned conference shall deal with all matters having to do with the position of employees of hospitals, including the matter of pension and superannuation funds and the allowable contributions thereto of hospital boards. 43. Student Nurses: Hours of Work.—That the request of the Registered Nurses' Association of British Columbia with reference to hours of work of student nurses be given favourable consideration. 44. Responsibility for Hospital Accounts of Evaders.—That since the collection of premiums under the " Hospital Insurance Act" is the function of the B.C.H.I.S., then the final responsibility for the collection or coverage of any hospital accounts incurred by evaders of the provisions of the Act is for the Service to assume; and that such a policy should be definitely adopted; but nevertheless the hospital board or administration concerned shall initiate and exhaust all reasonable steps in their endeavours to collect the said accounts from the patient or his responsible relatives in the first instance. FF 88 BRITISH COLUMBIA 45. Elimination of Social Security and Municipal Aid Tax on Hospital Supplies.— That the cost of purchases made by the hospitals of the Province covering articles or supplies which are exempted from the Federal sales tax be also exempt from the imposition of the social security and municipal aid tax. 46. Purchase of New Equipment: Consent of B.C.H.I.S.—(1) That the mechanics or operation of the rules and regulations pertaining to the granting of permission to purchase new hospital equipment shall be examined with a view to eliminating the difficulties and delays so far encountered, and thereby remove the cause for any complaint in the future. (2) That purchases by the hospitals of such new equipment, not having a cost value higher than $100, be made permissible without the prior consent of the B.C.H.I.S. Administration having to be obtained. 47. Central Purchasing Agencies.—That B.C.H.I.S. encourage hospitals to develop, to the greatest extent possible, a system of bulk centralized purchasing of supplies. 48. Dispensing of Drugs.—That all dispensing of drugs in hospitals, or for hospital patients, should be done by registered pharmacists or qualified physicians. 49. Chronic Cases (Social Welfare) Remaining in Hospital.—That where B.C.H.I.S. acknowledge that there is a surplus of beds in any general hospital, and the board of the hospital affected comes to an amicable agreement with the Social Welfare Branch to accept chronic cases at a certain rate differing from the fixed per diem rate approved by B.C.H.I.S., the consent of B.C.H.I.S. be given. The policy enunciated by the foregoing is predicated on the assumption that the beds so acknowledged to be surplus may be set apart for the use of chronic or convalescent cases, and will remain in that classification until the entire bed situation of the hospital concerned is reviewed by the hospital administration and B.C.H.I.S. 50. General Relations with B.C.H.I.S.—That the B.C.H.I.S. round out, as soon as possible, a complete organization of specialists in the various phases of hospital operation and management, to the end that they may render maximum assistance to hospitals and receive full co-operation in return. 51. Hospital Construction and Extension, etc.—That a more intensive study of the whole matter of hospital-construction than was possible in the limited time available to the Board be made; and that this study be proceeded with as soon as possible; and that new legislation be enacted, similar to the " Union Hospitals Act" of the Province of Saskatchewan referred to in the preamble to this recommendation, which will enable the setting-up of hospital improvement districts in the Province of British Columbia. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 89 INTERIM RECOMMENDATIONS MADE BY THE BOARD Interim Recommendations No. 1 and No. 2 This Board, in accordance with section 7 of the " Hospital Insurance Act Inquiry Act," makes certain interim recommendations which it considers should be submitted at this time, and which, if implemented, will remove what the Board considers to be injustices and will also change phases of present policy which are necessarily resulting in public antagonism to the British Columbia Hospital Insurance Service. It has been drawn to the Board's attention repeatedly at hearings of the Board, and conclusive evidence has been produced to amply demonstrate, that many persons have been denied benefits when they honestly considered themselves to be fully paid on premiums, or when their ineligibility was due to circumstances over which they themselves had no control. Therefore, in accordance with a motion properly moved, seconded, and unanimously carried at a meeting of the Board held at Nelson, B.C., on Saturday, the 11th day of August, 1951, it is now recommended to the Minister of Health and Welfare:— If a premium payment, or a premium payment and arrears, is received by the British Columbia Hospital Insurance Service within seven (7) days after due date, that the insured person or persons be considered as having remained in " good standing " for purposes of benefits under the British Columbia " Hospital Insurance Act," and not subject to section 9-1 of the regulations under the said Act; and it is also further recommended that the seven (7) days' grace be further extended where necessary to meet circumstances when distance and postal-delivery circumstances or services cause additional difficulties affecting the receipt of the said premium payments by the British Columbia Hospital Insurance Service. That in cases brought to the attention of the British Columbia Hospital Insurance Service where hospitalization bills have not been accepted as a valid responsibility of the Service, where it can be shown that premium payment after due date was due to uncontrollable factors respecting receipt of premiums, that the said accounts be accepted for payment by the British Columbia Hospital Insurance Service [this policy to be publicized]. That publicity be given to a British Columbia Hospital Insurance policy that anyone making payment of premium or premium and arrears to any authorized Government official, such as a Government Agent, will be in " good standing " from the date of the receipt given by the said official, subject to the terms of the recommendation numbered one (1) above. Submitted on behalf of the Board. S. J. Smith, Chairman. Interim Recommendation No. 3a (Amendment of Recommendation No. 3) Whereas there are numerous cases of pensioners and other persons subject to a very limited income, who are making every attempt to pay the necessary premium for the current period, but who find it completely impossible for the time being to meet the premiums which should have been paid for the years 1949 and 1950, and in which cases it is within the power of the Commissioner to suspend indefinitely the payment of such arrears: FF 90 BRITISH COLUMBIA Therefore be it Resolved, That this Board recommends to the Minister that where the Commissioner uses the authority conferred under Regulation 2-13, and applies a payment by any registrant to the premium due for the current six months' period, and there is still a payment necessary to meet fully the said premium for the current period, upon payment of same being made, the insured person or persons shall be considered to be a beneficiary pursuant to the Act, and entitled to the benefits provided by the Act, immediately after the lapse of fourteen (14) days from the date upon which the payment of the said premium for the current period has been made or completed, notwithstanding the fact that the registrant may still be in arrears of premiums for prior periods, which arrears have been indefinitely suspended. At a properly constituted meeting of the Hospital Insurance Inquiry Board held in Vancouver on Wednesday, October 17th, 1951, the above recommendation was approved and adopted. On behalf of the Board. S. J. Smith, Chairman. Interim Recommendation No. 4a (Amendment of Recommendation No. 4) During the hearings of the Hospital Insurance Inquiry Board throughout the Province since the 27th day of July, considerable evidence has been presented to the Board indicating that a substantial percentage of persons who are required to be insured under the Act are not so covered. The Board is informed that the statistics of the British Columbia Hospital Insurance Service show that, of the persons admitted to hospitals during the first half of 1951, the percentage of persons referred to above is 7.03 per cent. Attempts by this Board to ascertain the percentage of the total population in this category have resulted in estimates being given to them which vary from district to district all the way from 10 to 40 per cent. While this Board is not in a position to pass judgment as to the exact percentage, it is nevertheless satisfied that this exact percentage is considerably higher than that estimated by the British Columbia Hospital Insurance Service. It would therefore seem desirable to establish some method or procedure by which a betterment of the existing situation is made possible, both from the point of view of the British Columbia Hospital Insurance Service and that of the general public. It has been represented to the Board that as far as people in this category are concerned, many would like to register themselves, but are deterred by the fact that payment (at the time of registration) of arrears of premiums would be a financial impossibility, and the knowledge that until the said arrears of premiums are paid they could not receive any of the benefits of the British Columbia Hospital Insurance Service. It seems evident to the Board that the premiums of this group of people, for the current year alone, if secured by the British Columbia Hospital Insurance Service, would provide an addition to the cash income of the British Columbia Hospital Insurance Service amounting to a very considerable sum. In addition, the gap in the difference between the total population and those registered under the Service would be narrowed down, and this would result in a larger revenue after the current year, at a reduced collection cost. Many suggestions have been advanced to this Board as to methods of settling the matter of arrears of these people, ranging from " wiping the slate clean, and starting REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 91 afresh " to " prosecuting with the utmost rigour of the law." The Board is of the opinion that some reasonable plan is possible, whereby the problem may be very largely resolved with immediate benefit to the British Columbia Hospital Insurance Service, satisfaction to most of the delinquents, and safe from any justified criticism of a severe nature by those who have done their full duty under the " Hospital Insurance Act." It should be borne in mind that some of the persons referred to in the first part hereof have not at any time had the protection of the " Hospital Insurance Act," and that a number of them may have incurred penalties through the loss of that protection, by reason of personal payment of hospital bills, or by deferment of hospitalization which they might otherwise have sought and obtained. Therefore, we recommend to the Honourable Minister of Health and Welfare that changes be made in the regulations referred to in section 35 of the " Hospital Insurance Act," so that:— (1) Upon payment in full of the necessary premiums for the last six months of 1951, and the first six months of 1952, the persons referred to in the preamble to this recommendation be placed in good standing at the termination of a waiting period of fourteen (14) days, subject to the following further conditions, namely:— (2) That the said persons shall agree, in a form and manner to be set out by the Commissioner of the British Columbia Hospital Insurance Service, to pay to the British Columbia Hospital Insurance Service the amount of their premiums, in accordance with the Act and regulations, for the years 1949, 1950, and the first six months of 1951, such payment to be made, as far as possible, by regular periodical instalments, from time to time, as may be arranged. (3) Nothing in the above recommendations shall be construed as affecting those cases in which the Commissioner has or otherwise would, because of exceptional circumstances, grant indefinite suspension of the payment of arrears. (4) That the easement afforded by the changes in the regulations which are recommended above shall be extended only up to and including the 30th day of November, 1951, after which they shall cease to have force and effect. (5) That, as from the date last mentioned, it shall be the policy of the Commissioner of the British Columbia Hospital Insurance Service to secure the compulsory registration of all persons liable to registration under the Act who still remain unregistered, and to collect all arrears of premiums from such persons, without remission, and to take any and all steps as will result in complete registration of all persons coming under the Act, without further delay, and at the earliest possible date. (6) That suitable publicity be given at once, through the British Columbia Hospital Insurance Service, to these recommendations, if approved by the Minister, such publicity to first receive the approval of the Chairman of this Board, acting on behalf of the Board. At a properly constituted meeting of the Hospital Insurance Inquiry Board held in Vancouver on Wednesday, October 17th, 1951, the above recommendation was approved and adopted. On behalf of the Board. S. J. Smith, Chairman.. FF 92 BRITISH COLUMBIA Interim Recommendation No. 5 The Hospital Insurance Inquiry Board has met with fifty-six hospital boards. In the majority of hospitals it is found that they have incurred deficits over a six- or seven- month period in the 1951 year which .approximate, equal, or exceed the amount by which their budget estimates were mandatorily cut by the British Columbia Hospital Insurance Service, or are incurring deficits to an extent which, if continued for the remaining period of the current year, will equal or exceed the amount by which their budget estimates were cut. In the opinion of the Hospital Insurance Inquiry Board the estimated budgets submitted to the British Columbia Hospital Insurance Service, except in a few cases, were accurately and conservatively prepared. The Board has been unable to obtain any explanation as to the factual, actuarial, or reasonable basis upon which the budget cuts were made. The Board, after a great deal of consideration, finds it impossible to understand why the British Columbia Hospital Insurance Service made disproportionate cuts in budgets of hospitals of similar bed capacity in almost identical districts or to find any reasonable or factual explanation as to why a budget of $66,000 should be cut by $1. The Board supports the principle of hospital budgeting and review by the British Columbia Hospital Insurance Service, but is definitely of the opinion, based upon all information before it, that there has been neither rhyme, reason, nor understanding given to the budget cuts made by the British Columbia Hospital Insurance Service on the hospital budgets for 1951. The Board believes that in the majority of cases budget submissions of the hospital boards evidenced a greater real appreciation of facts and evaluation of future costs than that of the Rate Board of the British Columbia Hospital Insurance Service. The Hospital Insurance Inquiry Board strongly feels that present hospital deficits have, in the main, been incurred because of British Columbia Hospital Insurance Service budget cuts and rising costs in both labour and materials beyond the control of the hospital boards, and in the opinion of the Board the hospital boards have done everything possible to meet the British Columbia Hospital Insurance Service budget cuts. The Board is further convinced that sufficient evidence has been introduced to conclusively demonstrate the hospital boards in their original budget submissions were close in estimating increased costs. A further factor to be borne in mind is that although, in general, hospital budgets for 1951 were submitted to the British Columbia Hospital Insurance Service prior to the end of November, 1950, earliest advices sent to the hospital boards regarding the Rate Board cuts were dated approximately April 30th, 1951, and in numerous cases later than that date, and that, therefore, the hospital boards, in ignorance of the subsequent action, continued to operate for at least four months on the basis of their first budgets, and that this factor in itself is a legitimate explanation of some portions of the deficits reported up to the present time. The Hospital Insurance Inquiry Board feels that note should be taken of the fact that although the British Columbia Hospital Insurance Service increased hospital budget estimates by $199,591, the Rate Board decreased estimates by $1,191,441, thereby leaving a reduction from the actual budget submissions of $991,850. The Hospital Insurance Inquiry Board is strongly of the opinion that the consequences of the deficits already incurred are serious and deplorable, and are resulting in a pessimistic attitude on the part of the hospital boards and administrators, thereby curtailing their ability to provide services of the quality and extent to which the public is entitled. Furthermore, the Board feels that the situation is such as to create bad public relations, as instanced by the fact that many hospitals have not paid their accounts for two or three months and have thereby brought both the name of the hospitals and the British Columbia Hospital Insurance Service into ill repute. —— REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 93 It is therefore recommended by the Hospital Insurance Inquiry Board to the Minister of Health and Welfare:— (1) That immediate steps should be taken to establish a policy that will give to all hospitals at present operating on a deficit, or that may have an operating deficit at the end of the year, a grant or grants not to exceed the difference between their original budget estimate for 1951 and the budget decided by the British Columbia Hospital Insurance Service: (2) That any hospital operating on a greater deficit than its budget cut by the British Columbia Hospital Insurance Service shall have the opportunity to present its case for additional consideration through the Minister of Health and Welfare to the Executive Cabinet: (3) That should the funds of the British Columbia Hospital Insurance Service not be sufficient to pay in accordance with the aforementioned recommendations, same should be paid from the consolidated revenue: (4) That it should be made clear to all concerned that should the recommendations of the Hospital Insurance Inquiry Board on this matter be implemented, it be understood that they are only interim recommendations to, in part at least, take care of the immediate hospital situation; and that future financial arrangements between the hospitals and the British Columbia Hospital Insurance Service or the Government will be as may be recommended by the Hospital Insurance Inquiry Board as accepted or amended by the Government or the British Columbia Legislature. At a properly constituted meeting of the Hospital Insurance Inquiry Board held in Vancouver on Tuesday, September 25th, 1951, it was moved and seconded that this recommendation be approved and adopted. Motion carried unanimously. S. J. Smith, Chairman. Interim Recommendation No. 6 The Board has received numerous representations from hospital boards, doctors, organizations, and individuals strongly protesting what was generally termed " remote control diagnosis" relative to the classification of a sick person as " acute" or " chronic." The Board is not yet prepared to suggest a policy on this matter, but as an interim recommendation is unanimous in resolving that all patients admitted to a hospital who are in good standing as to premium payments and whose doctors declare them to be " terminal cases " requiring acute hospital care be accepted as the responsibility of the British Columbia Hospital Insurance Service for payment of hospitalization costs. At a properly constituted meeting of the Hospital Insurance Inquiry Board held in Vancouver on Tuesday, September 25th, 1951, it was moved and seconded that this recommendation be approved and adopted. Motion carried unanimously. On behalf of the Board. S. J. Smith, Chairman. FF 94 BRITISH COLUMBIA Interim Recommendation No. 7 Be it Resolved, That this Board recommends to the Minister:—- (1) That Regulation No. 9-1 (Restriction of Benefits), of the regulations under the "Hospital Insurance Act," be amended to read as follows:— " Where the required premium payment is made by, or on behalf of, a person on or after the first day of the hospital insurance period to which it is applicable, such a person shall not be deemed to be a beneficiary pursuant to the Act until fourteen (14) days from the date on which the payment was made. " Where an overdue premium is paid within the last fourteen (14) days of the hospital insurance period to which it is applicable, the fourteen-day term during which benefits are withheld, as provided herein, shall extend into the subsequent hospital insurance period, regardless of the fact that the premium applicable to the subsequent hospital insurance period is paid on or before the due date thereof." (2) That upon adoption of this recommendation by the Minister, suitable publicity be given thereto at the earliest possible date: (3) That publicity now be given to the recommendation of the Board, dated the 12th day of August, 1951, which recommendation has already been adopted, whereby a period of seven (7) days of grace is allowed after the due date for the receipt of a premium payment. At a properly constituted meeting of the Hospital Insurance Inquiry Board held in Vancouver on Wednesday, October 17th, 1951, it was moved and seconded that this recommendation be approved and adopted. Motion carried unanimously. On behalf of the Board. S. J. Smith, Chairman. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 95 COPY OF MINUTE APPROVED, OCTOBER 23rd, 1951 To His Honour the Lieutenant-Governor in Council: The undersigned has the honour to recommend That, pursuant to section 35 of the "Hospital Insurance Act," being chapter 151 of the "Revised Statutes of British Columbia, 1948," the " Hospital Insurance Act " Regulations, made by Order in Council No. 900, approved May 5th, 1950, as amended, be further amended by striking out Regulation 9-1, and inserting the following as Regulations 9-1 and 9-2:— "9-1. Where the required premium payment is made by, or on behalf of, a person on or after the first day of the hospital insurance period to which it is applicable, such a person shall not be deemed to be a beneficiary pursuant to the Act until fourteen days from the day on which the payment was made. Where an overdue premium is paid within the last fourteen days of the hospital insurance period to which it is applicable, the fourteen-day term during which benefits are withheld, as provided herein, shall extend into the subsequent hospital insurance period, regardless of the fact that the premium applicable to the subsequent hospital insurance period is paid on or before the due date thereof. " 9-2. Notwithstanding any other provision of these regulations, the period of time allowed for payment of a premium shall be extended until the seventh day of the hospital insurance period to which the premium payment is applicable, and if payment of the said premium is made on or before that day, the provisions of Regulation 9-1 shall not apply to the person on whose behalf the premium payment is made. Where a premium is paid after the commencement of the hospital insurance period to which it is applicable but prior to the expiration of the seven-day period of grace provided herein, the person on whose behalf the payment is made shall not be entitled to benefits pursuant to the Act during those days in the said hospital insurance period prior to the day on which the said payment was made." Dated this 23rd day of October, a.d. 1951. A. D. TURNBULL, Minister of Health and Welfare. Approved this 23rd day of October, a.d. 1951. H. ANSCOMB, Presiding Member of the Executive Council. FF 96 BRITISH COLUMBIA TABULATION OF ESTIMATED INCREASES TO THE INCOME AND EXPENDITURES OF THE B.C.H.I.S. CONSEQUENT UPON THE ADOPTION OF THE RECOMMENDATIONS OF THE HOSPITAL INSURANCE INQUIRY BOARD AS CONTAINED IN ITS INTERIM REPORT, FEBRUARY, 1952. No. and Subject of Recommendation Increased Income Decreased Income Increased Expense Decreased Expense 4. Elimination of co-insurance charges (increase in hospital budgets) 6. Municipal and Provincial per diem $2,000,000.00 $1,000,000.00 50,000.00 8. Inclusion of Christian Scientists as 11. Exemption of student nurses as $25,000.00 12. Out-of-Province hospitalization — 87,000.00 16. Hospitalization of Treaty Indians: Federal Government responsibility- 17. Hospitalization of Social Welfare cases—payment in full $436,500.00 1,000,000.00 18. Grants-in-aid to schools of nursing (reduction in hospital budgets) 130,000.00 19. Chronic cases—increased limit of B.C.H.I.S. liability 300,000.00 25,000.00 20,000.00 50,000.00 20. Management board for B.C.H.I.S. 27. " Chronic case " diagnosis—Medical Review Board 28. Special drugs—permissive use 30. Plan of registration and premium collection 875,000.00 50,000.00 1,065,000.00 34. Exemption cards—annual charge . $2,975,000.00 25,000.00 $25,000.00 $2,482,000.00 1,631,500.00 $1,631,500.00 Net increase . $2,950,000.00 $850,500.00 Net increase in B.C.H.I.S. income. Net increase in B.C.H.I.S. expense Net gain to B.C.H.I.S $2,950,000.00 850,500.00 $2,099,500.00 It is to be cleariy understood that the above calculations are set out to show only the effect of the proposed changes on the B.C.H.I.S. itself. The following items, showing a saving to the Service, would become a responsibility of other departments of the Provincial Government:— Provincial Government per diem grants—increase $650,000.00 Difference between premium payments and cost of full hospitalization of Social Welfare cases Grants-in-aid for schools of nursing . Payment of premiums for low-income groups (Board's Recommendation No. 10) 1,000,000.00 130,000.00 70,000.00 $1,850,000.00 In addition to these four items the Provincial Government (Department of Municipal Affairs) will pay the cost of the extra 25 cents per patient-day grant referred to in the last paragraph of Recommendation No. 6 (if implemented). The best estimate which the Board can make as to the aggregate amount of this item to be paid by the Government is $150,000 per annum. Note, however, that this item does not affect the finances of B.C.H.I.S. because the payment is intended to go direct to the hospitals concerned and to become " non-operating " revenue to them. It is also to be clearly understood that these calculations are based on the positive recommendations of the Board as found in its Report. They do not take into account any (other) increased costs of hospital operation which come into effect by reason of ordinary economic factor's reflected in hospital budgets for 1952 and future years. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 97 EXCERPT FROM THE ACTUARIAL REPORT OF MR. SAMUEL ECKLER, F.S.A., OF TORONTO, ON THE BRITISH COLUMBIA HOSPITAL INSURANCE SERVICE, DATED DECEMBER 1st, 1951. CHAPTER VIII. PROBLEMS AND RECOMMENDATIONS A. Summary of Problems At the meeting of the Inquiry Board that I attended on June 25th, 1951, I stated that part of my job would be to clarify the basic problems of the Hospital Insurance Plan. At that time, and in a letter to the Chairman of the Inquiry Board, I reviewed some of these problems. As a result of my investigation of the plan and its operation, I have modified my original conception of the problems and I regard the following as the important ones. 1. Should the universal compulsory hospital insurance plan be continued? If it should be continued, should any modifications be made in it? If not, what other techniques would solve the problem of health insecurity and hospital deficits? If the plan is to be continued, there are the following additional problems: 2. Finances. How should the moneys for financing the benefits under the plan be raised? Is the present proposed plan of raising approximately two-thirds by premiums, 30 per cent by provincial subsidy and 4 per cent by municipal grants satisfactory? Is the premium structure reasonably equitable? Should the provincial subsidy come from consolidated revenue or should it be an earmarked tax? Should a special tax be levied to cover the provincial subsidy? What provision, if any, should be made for the payment of premiums by low income and indigent groups? 3. Benefits. Should a service or cash benefit be provided? Are deterrents to hospital admission and prolonged stays desirable and, if so, how should they be arranged? Should hospital care be provided for chronic diseases? Should a maximum limit be put on hospital stays? 4. Hospital relationships. What method of payment should be used to reimburse the hospitals for benefits under the plan? What administrative relationships between the hospitals and the plan will produce the best results? 5. Should the plan be administered by a semi-independent agency composed of more than one person? B. Recommendations Many of the above problems have been discussed in previous chapters and some answers have been given. At this stage, I should like to summarize many of the conclusions I have drawn and give recommendations under three alternative courses of action. The first two approaches assume that it is desirable to continue the state-operated compulsory hospital insurance plan. The third approach involves the discontinuance of the hospital insurance plan and the substitution therefor of other methods to meet the hospital insurance needs of the citizens. If the compulsory hospital plan is continued under either one of the first two approaches, the following conditions should be satisfied, that (a) the rate of hospital utilization does not become excessive. Otherwise, the plan may be uneconomic in relation to alternative expenditures of the same amount of money. In order to accomplish this condition, deterrents to hospital utilization, both for admissions and long stays, are necessary. For example, I consider that the Saskatchewan utilization rate is excessive and that clearly too much emphasis has been placed there on hospital care as a method of improving the health of the people. (b) a reasonable amount of hospital autonomy be preserved. Otherwise, the insurance plan becomes a dispenser of hospital services as well as an insurance organization. (c) hospital per diem costs remain reasonable. Otherwise, the over-all cost of the plan would be too expensive. Approach 1. The present plan with minor modifications—that is, a service benefit plus almost universal coverage—should be continued. The chief advantage of this approach is that the beneficiary, except for his co-insurance payments, will have all his hospital costs paid for. The advent of co-insurance has FF 98 BRITISH COLUMBIA reduced this advantage somewhat but it is still an advantage. The chief objections to the plan are that it seriously reduces the autonomy of hospitals, the value of the service benefit varies from community to community and the beneficiaries do not understand the exact money value of the benefits they receive. If the Hospital Insurance Service promises a service benefit, then it must be prepared to pay what the local hospital says that benefit costs or step in and rule what those costs shall be. Basically, there is no other course. Nevertheless, this process can be effected on a reasonably equal partnership basis with the local hospitals participating in the affairs of the Insurance Service. The Blue Cross Plans, which usually provide service benefits, are almost in all cases owned and operated by the hospitals themselves. Undoubtedly, that is one of the reasons why the Plans are working satisfactorily. Practically, premiums cannot vary geographically and the defect of invariable premiums and variable benefits from locality to locality cannot be overcome. However, the fact of a substantial government subsidy and a different level of premiums might solve this problem to a large degree. The provincial Blue Cross Plans have the same difficulty. The fact that the beneficiaries do not know the money value of the service benefits they receive can be readily overcome by proper public relations. Under this approach, I suggest the following: (1) I see no strong reason for making any important change in the present exemptions. Some minor changes might be desirable. Administratively, it would undoubtedly be simpler to exempt no persons from the payment of premiums. For example, the exemption of approved plans might be withdrawn but I think there is some advantage from, a public relations point of view in offering the option of joining another plan to any group that qualifies. The hospital insurance costs of the employees of the British Columbia Telephone Company and the Canadian Pacific Railway are probably less than those of the members of the general population because the employees are select groups (any group of employees is, on the average, in. better health than the general population because they are younger and because the group excludes invalid persons). If the premiums are greater than the hospital insurance costs of those employees—and at the present level they may very well be—the Hospital Insurance Service would benefit financially by withdrawing the exemption from these two groups. However, if the premiums are reduced so that they are lower than the hospital insurance costs of these groups, then the Insurance Service would gain by continuing the exemption. The question of exempted persons should be constantly reviewed and individual equity arid the mechanics of administration should be balanced against the rights of members of certain groups. (2) The benefits provided beneficiaries suffering chronic diseases should be clarified. If any chronic diseases are excluded, they should be clearly named and listed. A definite maximum limit should be placed on the benefits for an insured chronic disease. Although I understand such a limit is being used now, by administrative discretion, it would be preferable to specify this limit in published regulations. I hesitate to recommend a basic liberalization of the coverage for chronic diseases in view of the age distribution of the British Columbia population and the high per diem cost. It is also important from a cost point of view to keep the hospital utilization rate at a minimum. I consider it very important to obtain the complete co-operation of the local hospitals and the medical profession in the matter of chronic diseases and to make certain that the public thoroughly understand the reasons for . limitations on chronic cases. (3) Some plan of co-insurance is essential to keep the hospital utilization rate at a minimum. The system of co-insurance should be designed to reduce admissions and long stays. In addition, it should be easily understood and administered. For each admission, I suggest that the beneficiary pay the hospital a fee of a specified amount—possibly the cost of one day's hospitalization for stays of more than one day and something less for a one-day stay—and so much per day for each day of hospital stay over a certain period. The amount of the admission fee, the number of days' stay beyond which additional payments by the beneficiary are required, and the amount of the additional payments can be determined by the condition that the total income to the hospitals from this source should equal approximately the present estimated co-insurance income. Before a change of this sort is effected, it should be discussed and approved by the hospitals involved. (4) The definition of " dependents" should be changed to include only spouse, unmarried dependent children under 19, unmarried dependent children between 18 and 21 going to school and unmarried incapacitated children. This change should not be introduced until provision is made for premium payment by indigents and low income groups. (5) The pattern of financing the hospital plan should be revised so that single persons pay a premium equal to about 50 per cent of the head of family rate (with dependents defined as in previous paragraph) and the provincial and municipal governments pay the remainder. I estimate that during 1950 the value of the hospital benefits paid to single persons was about $18. Whatever the single person paid over this amount was really in the nature of a poll tax, the proceeds of which were used to subsidize the hospital insurance costs of families. At this stage, I am not prepared to say more than that no premium rate charged any group of persons should be very much in excess of the value of benefits received by that group. It is clear that REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 99 the present premium rate structure does not meet this condition. The actual level of premiums depends on the amount of the subsidy the government wishes to provide for the plan. As an illustration, the single person premium might be $24 a year and the family premium $48. Under such rates, the government subsidy, exclusive of the premiums paid on account of indigents and low income groups, would probably be less than the 1951-1952 fiscal year estimate because of the suggested limitation in the definition of dependents. On the other hand, if the premiums are set at $21 for single persons and $42 for families, the government subsidy might be greater than estimated in the 1951-1952 budget (6) The Hospital Insurance Act should include a specific provision that employers be permitted voluntarily to share in the premiums required from employees who are covered under the plan. I understand that the British Columbia Electric and the Consolidated Mining & Smelting Companies pay 50 per cent of the premiums of their employees. There are probably a few other employers which pay part of their employees' premiums. The insurance plan should actively encourage this process, possibly by employing representatives to visit various employers. (7) The Act should be amended to provide that the hospital insurance premiums will be adiusted regularly in relation to changes in hospital utilization and per diem hospital costs. I consider this aspect important from a public relations point of view to make it clear that increases in hospital costs and hospital utilization may result in greater premiums. (8) Consideration might be given to special or earmarked taxes to finance the government subsidy to the plan. Such special taxes might be accompanied by a significant reduction in the proportion of the total hospital insurance costs raised by premiums, in which case the need for assistance in the payment of premiums to low income and indigent persons would be reduced. (9) Provision should be made for either municipal or provincial agencies to pay part or all of the premiums of persons unable to pay premiums and who request assistance. These persons include, among others, the needy aged, the needy unemployed and low income employees. A means test related to income only might be applied; for example, the rule might be that the hospital insurance premium should not exceed 2 to 3 per cent of the annual income of the person making application for payment of part or all of this premium. There are probably other methods of meeting this problem but I do not think that any of them are administratively as direct and simple as the above suggestion. Another method might be to provide that the premiums at no time exceed a certain percentage of a person's income. And still another solution might be to express the premiums as a percentage of income but never to exceed a certain specified maximum. My objections to both these methods are that they require a knowledge of every person's income and would also complicate collections. (10) The method of payment to hospitals should be designed so as to discourage unnecessarily long stays and encourage economy of hospital operation. The method adopted should also be accepted and understood by the local hospitals. (11) It is essential to set up a closer formal relationship between the local hospitals and the insurance plan than exists at the present time. Although the Hospital Advisory Council, which represents the interested groups, has an important role to play in the successful administration of the plan, I think some other liaison body should be established to effect harmonious relationships between the hospitals and the plan. I consider this suggestion important for the successful and economic administration of a service type of hospital insurance benefit. (12) The annual reports prepared by the Hospital Insurance Service should give a complete picture of the year's operations of the plan and a description of items, administrative and otherwise, of interest to the public. Among the operational items covered in the report should be included an analysis of the insured persons by age, sex, single and head of family, a breakdown of the gap between the total insured persons and the total estimated population by those exempted and those delinquent in premium payments, calendar year financial statements, statistics of per diem hospital costs, hospital utilization by age and sex, tabulation of admissions by length of stays, and admission rates. Approach 2. The present plan should be altered fundamentally by providing a cash per diem benefit to the hospital. The advantages of this plan are: (1) It effects a closer control of costs. The cost of the insurance plan would depend entirely on hospital utilization which can be kept reasonably level. An increase in hospital costs would mean greater hospital payments by the beneficiaries to the hospitals. Undoubtedly, rising hospital costs would bring about a demand for an increase in the per diem cash benefit but it would then be clearly understood by the beneficiaries that the increase in premiums is due to a rise in hospital costs. The payments for the services provided by the hospitals outside of room and board and general nursing could be better controlled. (2) The affairs of the local hospitals would not have to be as closely scrutinized under a cash benefit plan as they have to be under a service benefit plan. Accordingly, the Boards of Management of local hospitals would be able to exercise more independence in guiding the affairs of the hospitals FF 100 BRITISH COLUMBIA than under a service benefit. In effect, they would establish the payments required by the insured patients to the hospitals for the difference between the cash benefit allowed by the insurance plan and the actual rates charged by the hospitals. (3) Although the cash benefits allowed by the plan would probably have to vary from hospital to hospital, there could be a closer relationship than under the service benefit plan between the premium charged and the benefits allowed. (4) Under a cash benefit plan, the insurance plan would operate strictly as an insurance service and would not be directly concerned with hospital administration. Matters of improvement in hospital accounting and administration would then be looked after by a department of government especially trained and equipped for this service. The chief defects of the cash benefit plan are that: (i) many beneficiaries would probably still find it difficult to meet the deficiency payments required; (ii) unless the insurance plan interferes with the hospital's rights to establish rates charged its patients, many insured persons might feel that the rates charged are excessive. The recommendations under the first approach that would apply equally to the second are those respecting exemptions, chronic diseases, definition of dependents, financial basis of premiums, voluntary employer contributions, special taxes for government subsidy, assistance for indigent and low income groups, complete annual reports. In addition to the applicable recommendations made under the first approach, I suggest the following for this second one. (1) The per diem cash benefit should be established at a level slightly under the standard ward per diem rate. More than one per diem rate should be used with different rates for small, medium size and large hospitals. The reimbursements for special services should be either a multiple of the per diem cash benefit, for example 20 times, or a fiat amount such as $100 or $150. The per diem cash benefit should be reduced after a specified period, for example 30 days, to bring it in line with the lower hospital'costs for long stays and in order to discourage long stays. (2) A liaison would still be necessary between the local hospitals and the Insurance Service but it probably could be adequately arranged through an agency such as the Hospital Advisory Council. (3) Hospital deficits would no longer be a concern of the Insurance Service. If the government decides that some action has to be taken on this problem, it should be attacked by another agency of the government. (4) If this approach is followed, the change-over should be carefully prepared and understood by all institutions and persons concerned. Approach 3. The compulsory Hospital Insurance Service should be terminated at some future date. The advantages of this approach have already been examined in Chapter VII. They might be summarized as follows. Part of the hospital insurance needs of many people can be met by voluntary insurance agencies without involving the government in increasingly costly activity and without interfering with the rights of individuals. In addition, the government subsidy under the present insurance plan would probably produce a greater long range improvement in health if it were spent on preventive health measures and medical research. The objections to this approach are that voluntary insurance leaves large gaps in coverage and that the compulsory hospital plan has still not been given a fair trial. Possibly, with proper safeguards and more effective administrative procedures, some of the criticisms of the present plan might be overcome. If the plan is to be discontinued entirely, I suggest that an effort be made by the government to encourage voluntary insurance to cover as many persons as possible. Possibly some techniques could be devised to cover aged persons and persons in rural communities, which are the two large groups not presently adequately covered by the voluntary hospital insurers in other provinces. In place of compulsory hospital insurance, the feasibility of a state operated catastrophe medical care insurance plan might be considered. This type of state health insurance is being actively promoted in the United States by many groups. Under such a plan of insurance, all medical care expenditures, including all hospital payments and fees to health personnel (doctors, physicians-surgeons, nurses, etc.) in any one year in excess of a specified percentage of a person's income, would be paid as a benefit. Most of these plans contemplate that something less than the total catastrophe expenditures would be paid to the insured in order to prevent abuse of the plan. The cost of such a plan would depend chiefly on the percentage figure of income above which the insurance benefits are paid. A very high percentage might not cost very much more than the present government subsidy to the Hospital Insurance Plan. This plan might have popular appeal. In considering it, many aspects would have to be investigated—a careful analysis of the relation of medical care expenditures to family income, the distribution of family incomes and the method of financing and administration. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 101 ? WHAT SERVICES ARE NOT INCLUDED IN THE PLAN ? ? HOW DO I BECOME Definite Outline of those A BENEFICIARY ? B. C. H. I. S. Hospitalization Services which the Plan does not cover. - ? ? WHAT ARE THE PREMIUM RATES ? Outline of Premiums— (a) Single Persons: (b) Families: With details of Dependent Coverage included. o o ft Full Outline of Plan of Registration and Payment of Premiums, including the privilege of arranging Payroll Deductions between Employer and Employee. 3 o ft YOU WERE ASKING ? WHAT HAS THE INSURANCE SERVICE DONE TO DATE ? ? WHAT ARE THE BENEFITS INSIDE B.C. ? ? WHAT ARE THE BENEFITS OUTSIDE B.C. ? A. Number of Claims Paid to Date Amount Involved Number of Claims over $2,000 etc. etc. etc. a o Description of Benefits allowed to all Beneficiaries hospitalized within the Province. a ft Outline of Benefits provided for Registered Citizens of B.C. who enter hospitals outside the Province. FROVu UMiAtar, FF 102 BRITISH COLUMBIA o in Pi < S m H Pi O ft fc O 2 W Ph O 3 !/"> O H NO -H >r> "> o &•* cn CN O ON rn cn 00 cn CN r-l o o C-; o ON rn 'nI- r~: lo rH —: cn >n CN d en CN o o -igrod rH p~ —, o o O o o r) CN cn o ■* 1 >/-> ■* r~_ t^. >o CN cn >ri ■* ON ■".ON cn no o" no" oo" «vn cn" CN on" o oo" cn ON 69 Pi o t-- ■* CN rH .—1 CN cn Vi ON cn 1—1 CN CN CN CNl 69 «■ 69 69 69 69 H o o t-~ r^ cn Tl O "* T^ iH cn o ■* NKoO "t f~: 1 cn on TT n O ON i2 Tj- oo oo rn cn r-: ^f rH ■rf r^ d 00 CN ^•^goN en tj- o On cn V~l cn On ^r ■* cn ._ r^ cn 'S tt oo^ oo^ O rH ON O °\ i^) -* °°£ m.d 0 cn (si "OON (N oo"cn ■*" >n xr" r~- CN rH on oo CN -3" U") T-H "* ,—t in /-> Z£ o\ yCj -H n- sn o © »H P~ ON CN NO ■* rH oo NO q cn ja£ -ct r-^ on O NO ^ ■* ON go' ON r~: On ■* NO Tf °°. rH cn -h en ON TC ■« >o ON ^J- "* 2^ - oo -H NO oo On rH 0O NO CN iO 00 00 ON °Vd *2 M CN fN o" rn"o" >o NO" NO ON o NO ^ OO 00 CN CN rH .—I CI 69 ON ^r ^5- ^H CN CN CN CN w ^ ^5- 69 69 69 69 lO ON ON cn cn o o o ^ o NO t3 —i Sn on CN O oo cN O CN ON rH oo (N; q [^ s no d r^ Tf d xr oo C^l cn d en oo' t^ rt oo fig ^ •o >n ~ 69 lO — 0O >n cn CN C^l 69 o r^ V3- «►> Vi 69 69 &9 O On no /-) io on io O cn NO —: t~: C> C~i ^H* 't ■* NO ^ god no o r- "O no 00 t-~ «-> wn c ^ r^ io On 1 CN C~-_ >o 1/V-rH cn n NO_ r-^ *Jn °°od « r- o" o" r-" oo" irT cn no" on" no" t-~" v-i 00 69 NO HHCfJ o »o NO 69 00 69 69- «/^ 69 69 69 WMn rH 00 cn W) OO CNl ■5f O CN 0\ ^s, O rH © ON CN 00 cn — ->t CN P-; o "! 0 S o O NO CN ON "O cn NO On r~: I-h1 CN oo' -^t no no ^ 69 r-- no cn NO ON r^ tN ON If, 'A-, £„£ rH CN r-^ •* cn ■* NO^ ts CN °» o C O.00 0 rH ON cn oo" ^h" cncN o" r--" r-" o" CN O •* >> 00 .O IT, t~- S^ ON O «o «o rH In NO_ -c CN >o en q 00 cd oo CN ^ y/i t^. t~: 00 NO OC CN NO oo On rH ^od O O cn ~rf >0 00 CO t~- •* t~ o _ f- NO C "\ ^ ^ OO ON 00 NO »n CN NO »? ^on' 4- rH t— on" »o cn oo"cn" /-> OO CN '—1 1—1 CN cn — NO 69- €^ 69 69 69 b^ 69 0*N no cn cn cn ■* O CN -*.oCN oo cn On o cn C~; C~; cni o NO CN rH Tj,*-i °i. On 'NO r- ^NO CN cn no" o" ^-" rH i—i on" On" rf cn" 50 ^r ^■ ON T^ ^H cr\ cn CN cn 69 NO cj 69 CO ^e- Sr} 69 69 39 CJ T3 ! -h 3 CJ : « 4H •3 o 00 _3 _>. c CJ 3 Efl | *c3 Cd •a 3 .° 1 .& CJ oo ,—, > 1 CJ C .cj CJ > o I ^3 . cs : « s o % -3 5 > cr CJ 3 1) o w CJ t A h t-i z; oS § . g fJ CO Ih o ■a o 3 3 oj ■ - t '- — + CJ L a. ' J J r 3 ft 1 a i * J 0 ■d CO rJ CO o CJ 8 £ ° -S 8 "3 ccj 00 TB1 8 o 1 ™ ctj rn nv rt S S 3 >- S ■" ffl «■> O "Stj 9< ^ -3 ffi Ph O ^ l§ o S rn rt co n, .3 ° cj ca 5 |; .2 'o CJ . •-. Ch CJ — U to CD 3 5 o 60 C r. ■Jjj CJ cU « CJ £ D, Cd 0 ^ (2 Ph (X rt w X H < 5 c JH H — u Ph S D ,^ u u rt M | C c s cd cd a U5 a o £ ^ 3 W O ^3 cd cq 7§f u S3 > REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 103 SUMMARY REGARDING COMPARATIVE HOSPITAL STAFFS . . , , ... .. Hospital in Hospital in Actual hospital Capacity British Columbia City Saskatchewan City Beds and cribs 405 503 Bassinets 66 50 471 553 Rated capacity (beds) 405 466 Percentage of occupancy, 1950^ 86.73 98.9 Total patient-days 123,934 168,220 Gross operating expenses as per fixed budget, 1951 $1,854,003.00 $1,518,916.00 Net cost to service (estimated)_' $1,507,226.00 $1,368,673.00 Net wages and salaries (estimated) $1,204,903.00 $85.8,000.00 Per diem rate set for 1951 $11.95 $8.14 1951 Staff Administration and switchboard 53 44 Social service 4 2 Medical records 8.7 2 65.7 48 Graduate nurses 147.5 65 Student nurses 221 223 Practical nurses and nurses' aides 48 72 Orderlies 26 16 442.5 376 Laboratory— Pathologist 1 1 Technician and others 22 17 Students _' 10 ■ 23 28 Physiotherapy 4 4 Radiology— Radiologists 3 2 Technicians and others 14.5 11 17.5 13 Pharmacy 9.5 3 Interns 9.5 14 Nursing-school 9.0 28 17 Dietary 47 61 Housekeeping, gardeners 100 50 Power plant, laundry 40 32 Total staff 767.7 629 FF 104 BRITISH COLUMBIA PUBLIC HEARINGS HELD BY THE BOARD July 28th, 1951- July 28th, 1951- July28th, 1951— July 30th, 1951- August 1st, 1951- August4th, 1951 Ocean Falls. Prince Rupert. Williams Lake. Dawson Creek. —Prince George. ■Kamloops. August 6th, 1951—Vernon. August 7th, 1951—Kelowna. August 8th, 1951—Penticton. August 10th, 1951—Trail. August 11th, 1951—Nelson. August 13th, 1951—Cranbrook. August 13th, 1951—Fernie. August 15th, 1951—Nakusp. September 5th, 1951—Abbotsford. September 8th, 1951—Victoria. September 10th, 1951—Nanaimo. September 11th, 1951—Port Alberni. September 11th, 1951—Courtenay. September 12th, 1951—Powell River. September 17th, 1951—Vancouver. September 18th, 1951—Vancouver. September 19th, 1951—Vancouver. September 20th, 1951—Vancouver. September 21st, 1951—Vancouver. September 24th, 1951—Vancouver. HEARINGS HELD BY THE BOARD NOT ADVERTISED AS PUBLIC July 29th, 1951—Quesnel. July 30th, 1951—Pouce Coupe. July 31st, 1951—Fort St. John. August 9th, 1951—Grand Forks. August 14th, 1951—Golden. HOSPITALS VISITED AND HOSPITAL BOARDS HEARD Abbotsford Alert Bay - Visited No No __ . Yes Heard Yes Yes Armstrong Yes Ashcroft - - — Yes Yes Burns Lake - _ Yes Yes Chemainus Chilliwack Comox Yes No . No Yes Yes Yes Cranbrook .. Yes Yes Creston Cumberland Dawson Creek _ _ Yes No . Yes Yes Yes Yes Duncan - - - ~ __ Yes Yes Fernie No Yes Fort St. John Yes ' .__ Yes Yes Golden .. . Yes Grand Forks • _ - _ . No Yes Hazelton - Yes Yes Invermere - -- - Yes Yes Kamloops _ -. No Yes Kaslo - _„ Yes Yes Kelowna -. - . . Yes Yes Kimberley Ladysmith Yes Yes Yes Yes Langley - .._ No Yes Mission No Yes Nakusp No Yes REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 105 HOSPITALS VISITED AND HOSPITAL BOARDS HEARD—Continued Visited Heard Nanaimo . No Yes Nelson Yes Yes New Denver - - Yes Yes North Vancouver _ Yes Yes Yes Yes Ocean Falls . , Yes Oliver —- Yes Penticton Yes Yes Port Alberni _ _ No Yes Powell River — - Yes Yes Yes Prince George — Yes Prince Rupert _— Yes Yes Princeton _ ■ —_ - - . No Yes Quesnel .. - - - - Yes Yes Revelstoke Yes Yes Rossland Yes Yes Salmon Arm _ _ Yes Yes Smithers Yes Yes Summerland „- ____ _ - - Yes Yes Terrace ' Yes Yes Trail Yes Yes Vancouver— Royal Columbian, New Westminster Yes Yes Vancouver General Yes Yes St. Paul's _ Yes Yes Vanderhoof Yes Yes Vernon Yes Yes Victoria— Royal Jubilee No Yes St. Joseph's No Yes Williams Lake Yes Yes WRITTEN SUBMISSIONS TO THE BOARD Hospitals Abbotsford Hospital, Abbotsford, B.C. Arrow Lakes Hospital, Nakusp, B.C. Creston Valley Hospital, Creston, B.C. General Hospital, Chilliwack, B.C. General Hospital, Kelowna, B.C. General Hospital, Ladysmith, B.C. General Hospital, North Vancouver, B.C. General Hospital, Princeton, B.C. General Hospital, Powell River, B.C. General Hospital, Salmon Arm, B.C. General Hospital, Vancouver, B.C. Grand Forks Community Hospital, Grand Forks, B.C. Hawthorne Private Hospital, Vancouver, B.C. Langley Memorial Hospital, Murrayville, B.C. McDougall Memorial Hospital, Kimberley, B.C. FF 106 BRITISH COLUMBIA Mission Memorial Hospital, Mission, B.C. Nanaimo Hospital, Nanaimo, B.C. Penticton Hospital, Penticton, B.C. Rest Haven Hospital, Sidney, B.C. Royal Columbian Hospital, New Westminster, B.C. Royal Inland Hospital, Kamloops, B.C. Royal Jubilee Hospital, Victoria, B.C. Slocan Community Hospital, New Denver, B.C. St. Joseph's Hospital, Victoria, B.C. St. Joseph's General Hospital, Dawson Creek, B.C. St. Martin's Hospital, Oliver, B.C. Tofino Hospital, Tofino, B.C. Vernon Jubilee Hospital, Vernon, B.C. West Coast General Hospital, Port Alberni, B.C. War Memorial Hospital, Williams Lake, B.C. Labour Organizations B.C. Federation of Labour, Vancouver, B.C. Hospital Employees' Federal Union, Vancouver, B.C. Local 7310, United Mine Workers' Association, Fernie, B.C. Standard Railway Labour Joint Legislative Committee, Vancouver, B.C. Vancouver and New Westminster Trades and Labour Council, Vancouver, B.C. Victoria and District Trades and Labour Council, Victoria, B.C. United Steelworkers of America, Trail, B.C. Veterans' Organizations Army and Navy and Air Force Veterans, Gambier Harbour, B.C. Canadian Legion, B.C. Command, Vancouver, B.C. Canadian Legion, Rivers Inlet, B.C. Imperial Veterans' Action Committee in Canada, Vancouver, B.C. Imperial Veterans' Corps of B.C., New Westminster, B.C. Langley Legion No. 21, Langley, B.C. Women's Organizations British Columbia Women's Institutes (Bulkley-Tweedsmuir District), Decker Lake, B.C. B.C. Women's Institutes, Cariboo District, Quesnel, B.C. B.C. Women's Institutes, Peace River Block. Congress of Canadian Women, Vancouver, B.C. Miscellaneous B.C. Hospitals' Association, Vancouver, B.C. B.C. Hospitals' Association, Yale-Cariboo Zone. B.C. Polio Fund, Vancouver, B.C. B.C. Retired Civil Servants' Association, Victoria, B.C. Capitol Hill Ratepayers' Association, Vancouver, B.C. C.C.F. Peace River Executive, Dawson Creek, B.C. College of Physicians and Surgeons, Vancouver, B.C. Community Chest and Council of Greater Vancouver, Vancouver, B.C. Canadian Temple of the More Abundant Life, Vancouver, B.C. Comox South Liberal Association, Vancouver Island, B.C. Dawson Creek Chamber of Commerce, Dawson Creek, B.C. REPORT OF THE HOSPITAL INSURANCE INQUIRY BOARD FF 107 Dominion Income Tax Staff Association, Vancouver, B.C. Farmers' Institutes, District "J," Peace River Block. Farmers' Institutes, District " B," Bulkley Valley, Skeena Valley, B.C. Farmers' Union of Alberta (B.C. Section), Rolla, B.C. Halls Prairie Farmers' Institute, Cloverdale, B.C. Langley Ratepayers' Association, Fort Langley, B.C. North Sidney Property Owners' Association, North Sidney, B.C. Provincial Junior Chamber of Commerce. Pacific Coast Pipe Co. Ltd., Vancouver, B.C. Penticton City Council, Penticton, B.C. Pharmaceutical Association of B.C., Vancouver, B.C. Registered Nurses' Association of British Columbia, Vancouver, B.C. Registered Nurses' Association of B.C. (Kamloops-Tranquille Chapter), Kamloops, B.C. Surrey Property Owners' Association, Cloverdale, B.C. South Cowichan Taxpayers' Association, Vancouver Island, B.C. The Canadian Life Insurance Officers' Association, Toronto, Ont. Union of B.C. Municipalities, Victoria, B.C. Vancouver Board of Trade, Vancouver, B.C. White Rock Ratepayers' Association, White Rock, B.C. Yarrows Ltd., Victoria, B.C. Individual H. E. Andrew, City Clerk, Penticton, B.C. C. P. Bagnall, Vernon, B.C. H. A. Breen, Prince Rupert, B.C. W. G. Cowan, Postmaster, Field, B.C. Donald F. Gower, Dawson Creek, B.C. G. H. Jackson, Secretary-Treasurer, Canadian Pacific Employees' Medical Association of British Columbia, Vancouver, B.C. H. R. Matthews, 12 Marine Avenue, Westview, B.C. G. T. McKay, Supervisor, Settlement Service, Department of Citizenship and Immigration, Vancouver, B.C. J. A. Ploos, Secretary-Manager, Fernie Memorial Hospital, Fernie, B.C. A. H. Povah, Kelowna, B.C. Dr. C. M. Robertson, Osoyoos, B.C. A. E. P. Stubbs, Chemainus, B.C. Dr. T. W. Sutherland, Parksville, B.C. T. A. Titchmarch, Penticton, B.C. And many others. victoria, B.C. Printed by Don McDiarmid, Printer to the Queen's Most Excellent Majesty 1952 1,500-252-3119