How province kept rein on health contracting, despite what Danielle Smith says

The provincial government has for years kept a hand in the contracting-out of private surgeries through Alberta Health Services, despite repeated comments by the premier and health minister that any potential issues with procurement are AHS's own responsibility.

Multiple documents obtained by CBC News show direct interventions by Alberta's health minister into AHS contracting matters, as well as entities specifically set up to give the health ministry more oversight and influence in recruiting and dealing with private contractors.

The RCMP, auditor general and the government itself have launched investigations into AHS contracting in the wake of allegations made by former AHS CEO Athana Mentzelopoulos, including those in a wrongful dismissal lawsuit.

Statements of defence from both Health Minister Adriana LaGrange and the agency say Mentzelopoulos was terminated not because she was investigating contracting issues, but because she was failing to carry out her duties.

Both Premier Danielle Smith and LaGrange have insisted several times in recent weeks that any improper procurement decisions made regarding chartered surgical facilities would fall to the health agency instead of government.

"This is all internal to AHS. This is all AHS procurement," the premier told reporters on Feb. 19.

"They were the ones who drafted the directives. They were the ones who went out and received the bids. They were the ones who chose the proponent. And then they were the ones who were charged with the task of negotiating the terms of the agreement. The only role that the minister or government had was saying, 'Are you done yet? Have you got to the finish line yet?'"

But four months before the premier's remark, LaGrange issued a ministerial directive that specifically ordered AHS to extend a contract with an Edmonton private surgery clinic, and laid out the specific surgery volumes as well as the prices Alberta Surgical Group (ASG) would be paid per procedure — up to $10,500 for each knee or shoulder surgery.

According to a copy obtained by CBC News, LaGrange's directive on Oct. 18 also allowed her department to "direct and lead any negotiations that AHS is having, or will have, with respect to any agreements or possible agreements touching on or concerning CSFs."

In late December — weeks before Mentzelopoulos was terminated — an Alberta Health senior official wrote to the then-CEO that based on the directive, the ministry would take over all "due diligence" regarding proponents of proposed chartered surgery centres in Lethbridge and Red Deer, according to a letter CBC News obtained. 

According to LaGrange's statement of defence, the minister took action because the ex-CEO was "dragging her heels" on health reforms and the contract with Edmonton's ASG was set to expire at month's end.

With the directive, the minister "intervened and expedited the removal of the contract with ASG from AHS's oversight" and "to mitigate the obvious adverse effects on patients" due to there being no alternative surgical capacity if ASG's contract expired.

In LaGrange's legal statement and during question period, she's said she had to issue several directives during Mentzelopoulos's tenure at AHS to get the CEO to carry out provincial reforms.

But over the same period, the province was making structural reforms to assume control over AHS procurement.