Physician funding framework

The Alberta government is managing growth in physician spending by making practical changes to how we compensate physicians.

Table of contents

Negotiation update

In January 2022, government returned to formal discussions with the Alberta Medical Association (AMA) through an interest-based facilitation process. As discussions with the AMA continue on a future agreement, government will continue to work with physicians and the AMA to address common issues and health system challenges.

The parties have issued a joint statement indicating a commitment to rebuild their relationship and work together to focus on the COVID-19 pandemic response, physician compensation, and virtual care.

Physicians are paid according to the Alberta Health Care Insurance Plan and that continues uninterrupted. Albertans will continue to be cared for by dedicated physicians who are committed to quality health care in Alberta.

Update on physician negotiations (January 20, 2022)

Overview

Alberta will maintain its current level of spending on physicians while accounting for population growth and special initiatives, such as the Alberta Surgical Initiative. Alberta physicians will remain among the highest paid in Canada.

The physician funding framework was introduced March 31, 2020. It's a multi-year process that will require consultation with the Alberta Medical Association (AMA) at all stages. It will include:

  • implementing changes proposed during 2020 negotiations to prevent cost overruns
  • aligning benefit programs and administrative fees with those of comparable provinces
  • improving services for patients

Physician costs

Physician services account for 10% of total government spending. Alberta spends nearly 25% of health care dollars on funding physician services.

Physician funding framework initiatives

The physician funding framework will address growing costs so government can address important frontline health care priorities like improving mental health and addiction services and expanding the number of continuing care beds.

These initiatives were designed to enable Albertans to realize better health outcomes and build a stronger and more sustainable health system, while managing physicians spending growth.

  • Clinical stipends provided by AHS

    Clinical stipends, or payment top-ups for certain physician groups, are a carry-over from when Alberta had several regional health authorities.

    Removing clinical stipends will help ensure there is transparent compensation for patient care, ensuring all physicians are compensated for the delivery of insured services under the Alberta Health Care Insurance Plan.

    Many clinical stipend arrangements have already ended. Some programs have been offered a time limited extension to ensure impacted physicians have sufficient notice and time to consider transition arrangements being offered by Alberta Health and Alberta Health Services

    Reference: Bulletins for health professionals

  • Complex modifiers

    On March 17, 2020, the Government of Alberta announced changes for complex modifiers would not go ahead as planned. Read the news release

  • Comprehensive annual care plans

    This redundant billing code has been removed as physicians can bill for a comprehensive annual visit to provide patients advice on how to manage complex conditions.

  • Diagnostic imaging referrals

    Only the referrals for diagnostic imaging from practitioners who provide publicly funded services can be covered under the Alberta Health Care Insurance Plan. This is consistent with the approach taken by some other provinces. There is no change to the scope of practice of practitioners.

  • Diagnostic image billing appropriateness

    Streamlining physician fee codes for areas like diagnostic imaging ensures services are billed the same way.

  • Driver medical exam for patients 74.5 or older

    Having these drivers pay for their medical exam is consistent with other drivers under the age of 74.5 and aligns with coverage in other provinces.

  • Implement daily office volume caps

    Government has capped the number of daily billable "visit services" codes to enable physicians to practice within reasonable patient loads.

  • Non-invasive diagnostic test fees in AHS facilities

    Directing AHS to standardize the fees paid for non-invasive diagnostic procedures will ensure consistent compensation between hospital and non-hospital physicians.

  • Overhead

    Fees paid to physicians include both funding for the cost of their services and funding for overhead such as equipment, supplies, leases and technical staff – essentially the overhead costs a doctor has in their own practice.

    Physicians working in Alberta Health Services’ (AHS’) facilities have their overhead costs provided by AHS. This initiative is intended to ensure physicians are not billing overhead costs for services they deliver in these public health facilities.

    On April 24, 2020 we announced that rural physicians will be exempted from this overhead policy.

    Implementation of the new rates for facility-based codes (z-codes) is further extended until October 1, 2022. The extension will allow AHS to work through and standardize their overhead arrangements with physicians who are providing ambulatory or out-patient care within their facilities, without taking away focus from the current COVID-19 response.

    In the interim, all physicians are expected to continue to use the appropriate out-of-office fee codes (z-codes) when claiming for services provided in publicly funded facilities.

    Reference: Bulletins for health professionals

  • Stop accepting non-emergency good-faith claims

    Ending the practice of submitting claims for services provided to patients who cannot provide proof of AHCIP coverage or Alberta residency reduces the number of unpaid billing claims and ensures services are provided to eligible residents. Four other provinces do not provide good faith claims.

  • Submission of claims within 90 days

    Giving practitioners 90 days to submit their payment claims, instead of 180, improves budget forecasting, policy and planning decisions, an earlier publication of the Statistical Supplement and the inclusion of AHCIP benefits on the Statement of Benefits Paid – a product used by patients.

Benefit program changes

Continuing Medical Education Program

This program reimburses eligible physicians for costs incurred for the maintenance and enhancement of knowledge, skills and competency. Effective March 31, 2020, this program was eliminated. The Alberta government is in the process of re-establishing the program. Further details regarding the new program will be provided soon.

Medical Liability Reimbursement Program

This program reimburses eligible physicians for costs incurred for medical liability insurance premiums set by the Canadian Medical Protection Association.

On April 24, 2020, the government announced the Medical Liability Reimbursement Program deductible for all rural physicians, as well as all family medicine practitioners in Alberta, would remain at current rates. Alberta Health also assumed responsibility for administering the program from the Alberta Medical Association.

View: Health Professional Bulletin Med 227

Business Costs Program

The Government of Alberta will not be proceeding with changes to this program at this time.

Rural Remote Northern Program (RRNP)

On April 24, 2020, the government announced the $60,000 cap that eligible rural physicians can claim through the RRNP will be removed. With the change, Alberta will now have one of the best incentive programs for rural physicians in Canada.

View: RRNP Community Rate Table

Other compensation options

The Fee-For-Service model isn’t right for everyone. Optional Clinical Alternative Relationship Plans (ARP) enable physicians to spend more time with patients and address complex needs, without worrying about their compensation being tied to delivering specific services.

A dedicated phone number and email has been set up to make it easier to inquire about Clinical ARPs

Timeline

  • September 2019
    • Government provided notice to the AMA that it intended to begin negotiations on the AMA Agreement. The notification provided time for the AMA to prepare its proposals.
  • November 2019
    • Negotiations began with the AMA to reach a new agreement and government began consultations on 11 proposed changes primarily related to the schedule of medical benefits (SOMB, or “insured services”).
  • January 2020
    • Negotiations and consultations proceeded with no agreement reached.
    • Mediation, on both the negotiation and consultation proposals, began January 31 and continued into February.
    • The parties were not able to reach an agreement during mediation.
  • February 2020
    • Government announced it will implement its final offer from the negotiating table, including the 11 consultation proposals, and some changes to benefit programs.
  • March 31, 2020
    • The new Physician Funding Framework came into effect March 31, 2020.
  • April 24, 2020
  • July 9, 2020
  • September 16, 2020
  • February 26, 2021
  • March 30, 2021
  • July 2, 2021
    • Government announces progress on a range of collaborative initiatives with the Alberta Medical Association. Government and the AMA continue to work together to assess opportunities for reaching an agreement.
  • January 20, 2022

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