BC extends cost-reduction search to regional authorities

VICTORIA – The BC government is expanding its cost-cutting review to include regional health authorities as it focuses on minimizing unnecessary administrative spending. Ideas include more shared services for procurement and IT, according to the ministry of health.

The regional health authority review will be led by Cynthia Johansen, deputy minister of health, and follows the March 31 launch of the Provincial Health Services Authority (PHSA) review led by Dr. Penny Ballem, interim president and CEO, PHSA.

“I would like to thank the thousands of front-line workers who have already brought forward valuable feedback and ideas as we work through the health authority review,” said Josie Osborne (pictured), minister of health. “Next we are expanding more broadly to engage a wider range of stakeholders, partners and people working at regional health authorities to ensure we are focusing resources on patient care as much as possible.”

As part of the PHSA review, more than 6,200 staff attended a series of town halls and large group meetings and submitted more than 1,000 questions and comments. More than 3,900 PHSA staff have also shared ideas for efficiencies through a digital engagement process. Engagements with staff at the regional health authorities will occur throughout the summer of 2025.

The reviews will aim to find efficiencies and cost savings by examining and considering changes in four main areas:

• Consolidating administrative and corporate functions through a shared-services model;
• Optimizing existing shared services, such as procurement and IT services;
• Reducing duplicative processes identified through the review; and
• Improving and streamlining governance structures.

Interim expenditure management measures are in place to control administrative costs while the review is underway, including a hiring freeze on managerial and non-union positions unrelated to delivering critical patient services.

While findings from the review will shape recommendations and changes throughout the health system, the regional health authority model is essential to healthcare delivery that is connected and responsive to the needs and priorities of local communities and the populations receiving services.

Collapsing or merging the regional health authorities is not under consideration as part of the review.

According to the Canadian Institute for Health Information (CIHI), B.C.’s healthcare system has among the lowest levels of administrative spending in Canada and its corporate services expense ratio has remained relatively stable in the past five years, at around 3.5%. This is the second lowest in Canada and below the national average of 4.4%.

The health authority review aims to further lower B.C.’s corporate services expense ratio, because every 0.1% reduction in administrative costs represents approximately $35 million more funding available for front-line patient care.

The province anticipates that the health authority review, both for the PHSA and the regional health authorities, will continue into the fall of 2025 and be complete in early 2026. Its findings and recommended changes will be released publicly.

To learn more about the health authority review, visit: https://news.gov.bc.ca/releases/2025HLTH0024-000279