Profit--yes or no? (Comments).

Should for-profit companies be favoured or excluded from the delivery of publicly funded health and social services?

This question becomes more intense as governments throughout the world continue to contract out these functions. They turn to a variety of organizations, including; arms-length public bodies (e.g. health authorities), non-profit organizations, and privately-owned companies.

This devolution is based on several arguments. One suggests that flexibility and innovation are more likely to occur outside government structures. Other arguments relate to costs because non-government companies pay lower wages and are less prone to labour union influence on staffing arrangements. Some argue for "marketization" as a basic principle and say "let the market decide."

As the devolvement has proceeded, flexibility and innovation have taken a strange turn. The Ontario government, for example, nervously prefers to control these devolved functions through a series of standards and accountability requirements are as onerous as any bureaucratic procedures ever devised by government. Creativity is stifled but the government is happy to exert control without having to bear the responsibility for, delivery.

Non-profit organizations and for-profit companies compete for contracts for government-funded services. However, the lines between the for-profits and non-profits are not as sharply drawn as might appear at first. Many of the services provided by publicly funded non-profit community agencies and subcontracted or "outsourced" to for-profit companies and Independent professionals. Hospitals have led the way in hiving off their functions to private service providers (e.g. lab work, x-rays etc). Hospital administrators are looking for more ways to contract out even more treatment functions to private companies.

While the health field has been the most prominent in contracting out, the children's services field has also emerged as a growing contractor and several large and medium-sized companies have arisen in this area. In Ontario, these companies contract with non-profit children's organizations to serve high risk and difficult-to-manage children placed in privately run institutions by Children's Aid Societies in Ontario. Across Canada, small proprietary group homes contracting with child welfare agencies, are a growth industry. Our contacts with child welfare people indicate that the ratings of these contracted-out arrangements range from excellent to poor. ("We have no other choices," is the often heard comment.) Other examples can be cited in the corrections field as well.

The debate was sharpened recently by the Romanow report on the future of health care in Canada. Romanow concluded from his studies of the u.s. situation that non-profit hospitals are likely to give better service and cost less than for-profit ones, even though non-profit hospitals serve poorer and sicker patients. Romanow recommends that direct health services (treatment and care) be delivered through non-profit provider. Much to the chagrin of labour unions, he does not object to the use of for-profits in ancillary services (e.g. laundry, and maintenance).

Romanow also argues that the current development of private MRI clinics will enable affluent people to move to the of the line, contrary to the principles that have guided health care system. He recommends that imaging services be recognized as "essential services" in the Canada Health Act which would effectively prohibit private payment for MRI's. This is a major bone of contention between the federal government and three provinces--Alberta, British Columbia, and Ontario, which are encouraging such services.

In financing and delivering health and social services, we need to be guided by the values of equity, fairness, and social solidarity. We must be prepared to assure adequate services, and equal access without favoritism. The framework should be one that reinforces the sense that "we are in this together." We care for one another and accept this responsibility.

We believe that non-profit agencies are more likely to satisfy these values of equity, fairness, and social solidarity than the for-profit companies. Public policy should favour the non-profit service providers and use the for-profits when no other reasonable options are available.--L.K.