An analysis of the shouldice hospital in canadian hospital systems

Non-Mesh Hernia Repair A career long commitment to non-mesh hernia repairs. Thirty five years ago, while in training, Dr.

An analysis of the shouldice hospital in canadian hospital systems

Contact Proposed sale of Shouldice Clinic triggers privatization concerns A privately run, for-profit hospital in Canada has recently waded into the private-public debate in Canada and the outcome may influence the future direction of the Canadian health system.

An analysis of the shouldice hospital in canadian hospital systems should look towards not only Canadian and US health systems to inform this debate, but also towards high performing systems where for-profit providers are a part of the care delivery mix, such as the Netherlands.

The Shouldice Clinic is a privately owned, for-profit hospital in Ontario, Canada specializing in hernia repair operations. The Shouldice Clinic is an aberration in a health system where the vast majority of healthcare providers are not-for-profit and the Canada Health Act explicitly forbids charging patients more than the government run health insurance system pays for the same procedure.

The Shouldice Clinic exists only because it was established prior to Medicare and has been allowed to continue as a private hospital in family ownership. This tenuous relationship with the government has now been jeopardized by the wishes of the Shouldice family to sell the hospital… To another for-profit company no less!

The responses to this proposal tell us a lot about the Canadian psyche regarding privatization in healthcare, and unfortunately the signs are not all positive. Reputation for high quality at Shouldice Clinic It is worthwhile noting that the quality of care that the Shouldice Clinic provides is not in question.

They are recognized around the world as providing high quality care for a competitive price, and serve as an example of the advantages of specialization and high volume care delivery.

This is evident because the Ministry of Health and Long-Term Care in Ontario pays for many of the operations that are completed by Shouldice, which it presumably would not do if the quality were lower or the costs higher.

Well, on the one hand not much. In September the Shouldice family announced plans to sell their business to another for-profit Canadian healthcare provider called Centric Health.

Centric Health operates health clinics around Canada and has been rapidly growing with a tripling of revenue between to The government of Ontario would presumably continue to contract with the for-profit Centric for hernia repairs, just as it has with the for-profit Shouldice, as long as quality and costs remain advantageous compared to alternative not-for-profit hospitals.

On the other hand, many perceive a significant change. The purchase means that the Shouldice Clinic would be owned by a publicly-traded instead of privately-held company 1.

Others raise concerns that despite the fact that Centric is a Canadian company, the majority owner is Global Healthcare Investments and Solutions which is a US-based venture capital firm 2. Centric has traditionally provided services that are not covered by provincial health insurance plans.

For Centric, the Shouldice Clinic is an opportunity to compete directly with existing non-profit hospitals for publicly insured business.

Non-profit providers in Canada have generally been shielded from significant competition, although Centric states that Shouldice would continue to operate for at least 4 years in its current format.

In typical Canadian style, many are looking south of the border to the US and raising the alarm; south to one of the lowest performing and most expensive healthcare systems in the world.


Many for-profit healthcare providers in the United States under-perform compared to their non-profit competitors 3. Potential reasons for this include a more competitive environment and a lack of appropriate regulation.

In a health system that does not rigorously measure quality there are incentives to compete on price instead of quality. A competitive environment places additional pressure on a for-profit that is expected to produce a positive margin. Not all privatization has led to disaster But if underperformance is inevitable in for-profit hospitals, how can we explain the success of the for-profit Shouldice Clinic, which despite these potential pitfalls has been providing a high quality and low cost service to patients in Ontario since it was founded in the s?

And we should not forget the fact that the majority of physicians in Canada are incorporated as for-profit businesses, yet despite this the sky has not fallen. For another example of for-profit healthcare we can look to The Netherlands which is regarded as having the one of the best performing healthcare systems in the world 4.

But rather than exclusively finding examples of the dangers of for-profit healthcare, the Dutch have developed a system where for-profit and not-for-profit hospitals successfully compete to deliver healthcare 5. In fact, for-profit providers are rapidly transforming the healthcare landscape as they specialize in high-volume care delivered outside of expensive hospital settings.

In many cases these independent treatment centres are setting the standards for cost and quality 6while several non-profit hospitals have experienced major quality problems 78 and others have gone bankrupt 9.

Reputation for high quality at Shouldice Clinic

Strict regulation and a mature quality measurement system provide a framework for healthy competition. The Shouldice Clinic would be right at home. The public-private debate continues… But are the best interests of patients properly represented?

Unfortunately for the debate, it now looks unlikely that the sale will proceed. In November Centric Health announced that it will not proceed with the purchase.

They quote recent political developments in Ontario as playing a role in this decision So what does the proposed purchase of the Shouldice Clinic tell us about the future of healthcare?

In my opinion, not much new. It appears that for-profit and not-for-profit healthcare providers can successfully compete with one another on both quality and cost. There are obvious potential pitfalls if the quality of services that are provided cannot be compared.

And not-for profit providers appear to have little to fear, unless they are so inefficient that they cannot match the prices of a competitor with a similar cost-base and the additional burden of creating a profit for shareholders.

It does not appear inevitable that for-profit healthcare leads to low quality or high costs. The negative responses of many to the proposed purchase are concerning.The Shouldice hospital, serves as the only hospital that provides treatment for abdominal hernia operating approximately patients annually using its entire capacity.

An analysis of the shouldice hospital in canadian hospital systems

The hospital serves the niche effectively and the success is highly dependent on the unique surgical methods the hospital uses for the treatment of hernia patients. Shouldice Hospital Limited Summary/Abstract: Shouldice is a private hospital founded by Dr.

Earle Shouldice in Toronto in July The hospital started out .

An analysis of the shouldice hospital in canadian hospital systems

CASE ANALYSIS: SHOULDICE HOSPITAL LIMITEDExecutive Summary:The Shouldice Hospital, Ontario, Canada is a pioneer in the field of treating patients suffering from external abdominal hernia. Analysis: Shouldice Hospital has been successful for several reasons; including its effective service culture, its efficient operational processes (Table 1), as well .

The hospital has effectively delivered to this expectation through extensive research by Dr. Shouldice and the development of the Shouldice method. Furthermore, each surgeon develops expertise by performing nearly hernia operations per year versus for a surgeon at a general hospital.

Shouldice Hospital Case Study Calvin Barron Liberty University March 2, Respectfully submitted to Prof. Scott McLaughlin Overview The Shouldice Hospital serves as a glaring example of extraordinary service and care for the impaired and needy.

Specialisation and standardisation: Value-based healthcare at Canada’s Shouldice Hospital