AHS cutting costs by freezing salaries, monitoring sick leave

WATCH ABOVE: Alberta Health Services is being asked to contain costs. As Tom Vernon reports, the government is starting to reveal how it plans to save money.

EDMONTON — Alberta Health Services has announced new “cost-containment” measures in administrative areas, promising they will not affect direct patient care.

AHS President and CEO Vickie Kaminski says it’s an effort to control public spending “in light of the dramatic drop in oil prices”. Last week, Premier Jim Prentice announced he and his cabinet ministers will cut their pay by five per cent as Alberta deals with billions of dollars in lost revenue. On Wednesday, all Alberta MLAs agreed to do the same.

READ MORE: Alberta cabinet agrees to take 5% wage cut

AHS receives 30 per cent of the provincial operating budget.

One key cost-saving measure is in payroll/staffing costs, where strict criteria will be considered before filling a vacancy.

“I would like to assure Albertans that every option will be explored to minimize the impact on the delivery of health care services in this province,” says Kaminski. “The quality of care that they receive will be our first priority.”

Tweet This Click to share quote on Twitter: "I would like to assure Albertans that every option will be explored to minimize the impact on the delivery of health care services in this province," says Kaminski. "The quality of care that they receive will be our first priority."

There will also be no salary increases. In recent contract negotiations with AUPE members, AHS originally offered a one per cent increase per year for each of three years. The offer was amended to zero per cent.

READ MORE: Alberta government, employees reach contract deal 

“I can appreciate the AUPE members were not happy,” says Kaminski, “but we really had little choice considering the uncertainty around the financial resources we will have available as a result of what’s happening with oil prices.”

Other affected areas include:

1. Severance – Ensuring severance payment is the last option when terminating an employee. Kaminski feels severance will have the biggest impact on the budget.

“$3.5 million spent this year alone in the first three quarters… I would be expecting to see that as close to zero as possible.”

Tweet This Click to share quote on Twitter: "$3.5 million spent this year alone in the first three quarters… I would be expecting to see that as close to zero as possible."

2. Goods and services – Restraints will be implemented for purchases not related to direct patient care, as well as grants and travel expenditures.

3. Cellphone/mobile device use – New policy to control costs, particularly roaming charges.

4. Sick leave – Implementation of Attendee Awareness Program to reduce sick leave costs.

AHS sick time costs about $190 million per year.