The Alberta government has announced a new funding model for acute health care.
Alberta’s government is implementing reforms to acute care funding through a patient-focused funding model, also known as activity-based funding, which pays hospitals based on the services they provide.
Activity-based funding is based on the number and type of patients treated and the complexity of their care, incentivizing efficiency and ensuring that funding is tied to the actual care provided to patients.
Alberta’s government says currently, the health care system is primarily funded by a single grant made to Alberta Health Services to deliver health care across the province.
They added the grant has grown by $3.4 billion since 2018-19.
Patient-focused, or activity-based, funding has been successfully implemented in Australia and many European nations, including Sweden and Norway, to address wait times and access to health care services, and is currently used in both British Columbia and Ontario in various ways.
“The current global budgeting model has no incentives to increase volume, no accountability and no cost predictability for taxpayers. By switching to an activity-based funding model, our health care system will have built-in incentives to increase volume with high quality, cost predictability for taxpayers and accountability for all providers,” said Alberta Premier Danielle Smith.
“This approach will increase transparency, lower wait times and attract more surgeons – helping deliver better health care for all Albertans, when and where they need it.”
Leadership at Alberta Health and Acute Care Alberta will run a pilot to determine where and how this approach can best be applied and implemented this fiscal year.
Final recommendations will be provided to the minister of health later this year, with implementation of patient-focused funding for select procedures across the system in 2026.
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