Study shows many hospital restaurants, including those in Alberta, are operating at a loss

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CALGARY – As Alberta Health Services (AHS) searches for a company to take over the rest of its laundry services, new data shows many restaurants and cafeterias in Alberta hospitals are operating millions of people in the red for years. AHS has announced a request for proposals (RFP) from third-party vendors to take over the cleaning process for the massive amount of linens, towels and other products that hospitals in Alberta use every day.

The province said it was taking the step towards privatizing many of the services currently offered in Alberta hospitals earlier this month.

Health Minister Tyler Shandro said the request for proposals will allow the health care system to find savings for Albertans.

“By reinvesting the savings from initiatives such as outsourcing laundry services into the health care system, we can improve patient care and ensure Albertans receive the best possible health care,” said he said in a press release on Friday.

AHS says more than two-thirds of its laundry services are already provided by a third party, including all laundry services in the City of Calgary and Edmonton.

He says the transition will save more than $ 38 million that could be used in other areas to support patient care.

It is estimated that 428 full-time, part-time and casual employees will be affected by the change.

“AHS is committed to working with them and their unions throughout this process. AHS anticipates that there will be employment opportunities with the new supplier (s), ”officials say.

HOSPITAL RESTAURANTS HAVE LOST MILLIONS

One of the other areas identified by the health minister’s office as a potential for cost savings was cafeteria services and hospital-run restaurants.

The data, released earlier this week by SecondStreet.org, shows that many commercial restaurants in Alberta that operate inside hospitals have recorded losses.

The highest losses in 2017-18 and 2018-19, the two years the organization looked at for its study, both occurred in the cafeteria of the main hospital at the University of Alberta.

Key findings from the SecondStreet study indicate that if hospitals fail to break-even cafeterias and food kiosks, private companies should take them over.

(Source: SecondStreet.org)

“Several hospitals in Canada have done just that and they have been able to turn the losses into gains and focus more on helping patients,” said SecondStreet.org president Colin Craig. “Cooks don’t do surgery and health care administrators aren’t restaurant managers – and it shows.

‘THE FINDINGS ARE AGAINST THE EVIDENCE’

The province says the data compiled by SecondStreet.org matches what it has found during its own research, including the MacKinnon report and the recent journal AHS.

“The SecondStreet.org results match the evidence,” said Steve Buick, press secretary for Health Minister Tyler Shandro. “We need to find efficiencies in the health care system to pay for more patient services, while ensuring Albertans are protected from the COVID-19 pandemic.

“AHS will contract out non-frontline services to independent contractors who can operate more efficiently than the government. This includes laundry, lab testing, housekeeping, and catering services. The subcontracting of catering services will continue in 2021. ”

Buick adds that some hospital services in Alberta are already successfully outsourced to third-party companies.

“Almost 70 percent of province-wide laundry services and 73 percent of community lab testing in Edmonton and northern Alberta.”

He also stressed that the province’s plans will not necessarily result in a net loss of jobs.

“In fact, many employees will just be doing the same job for another employer. Any reduction will be managed as much as possible by attrition. ”

AHS says the RFP process for a potential laundry service provider could take about four months. The implementation would depend on the company chosen to take over the services.

CTV News has requested full details on tenders for restaurants, housekeeping and laboratory services, the other areas identified for reorganization by Minister Shandro’s office.

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