Ontario’s eHealth scandal continues to unfold, not becoming yesterday’s news fast enough to help Premier Dalton McGuinty save face.
A damning report by Auditor-General Jim McCarter paints a picture of favouritism run amok in the agency, which blew through $1 billion with little to show for it as the province tries to implement an electronic system for its health records.
In a report released this week, McCarter confirmed allegations made earlier this year that eHealth Ontario awarded contracts to certain companies without giving other firms a chance to compete were “largely true,” as were allegations of favouritism in the awarding of such contracts. For example, one firm that bid 500 per cent more than the next qualified bidder was invited to bid again, the only company offered such an opportunity, and, after lowering its bid significantly, won the contract. Another firm that was awarded untendered contracts on the first phase of several projects was awarded many subsequent contracts worth about $7 million to work on successive phases of those projects.
McCarter’s findings were enough to prompt the resignation of Health Minister David Caplan, who had been rocked by successive eHealth scandals.
Those involved in the agency have tried to justify the practices by citing the need for speed and continuity. Tendering every facet of the project, they claimed, would slow down the process that was already well behind what other provinces have accomplished on the electronic records front. As well, given how few experts exist in the field, tendering would not be the panacea critics claimed, they argued.
The former argument – speed – was debunked by McCarter, who noted the recent replacements of the eHealth Ontario board chair and CEO mark “the fourth such overhaul of leadership at eHealth Ontario and its predecessor” and each of these overhauls brought with it its own period of transition where progress on the initiative’s objectives was slowed or, at times, virtually halted.
That lack of progress, coupled with massive cost overruns, puts to rest the second argument that specialized experts were necessary and hard to come by, thus justifying the huge payouts they received.
The agency was rife with consultants pulling in large payments for work that often went unchallenged and unsupervised. While eHealth had fewer than 30 full-time employees, the number of consultants ballooned to more than 300, some of them holding senior management positions.
The agency ignored even its own lax policies in handing out plum contracts.
McCarter laid most of the blame on former eHealth Ontario CEO Sarah Kramer, who resigned under pressure in June, but not before taking a $317,000 severance package. The Auditor-General found she routinely issued untendered contracts, with favouritism at play.
And even the outrageous fees paid to those consultants went unmonitored. This week’s report cites the case of one consultant hired at the bloated rate of $1,300 per day who actually received $1,500 daily. Although the overpayments amounted to $45,720 by the end of the contract, managers opted not to recover the difference.
McGuinty has vowed to put new rules in place to prevent a repeat of the eHealth scenario, also pledging to have an electronic health records system in place by 2015.
Ontarians will be looking for action.