Government & policy
eHealth Ontario CEO, Sarah Kramer, is
TORONTO – Ontario
Health Minister David Caplan announced the firing of Sarah Kramer
(pictured), CEO of eHealth Ontario on June 7. The government was under
pressure from opposition politicians to take action after the CBC and
daily newspapers publicized questionable practices at eHealth Ontario –
including untendered contracts to consulting firms and large bonuses and
Caplan said in a government news release: “I am acting immediately upon
[the eHealth board’s] request to revoke Sarah Kramer’s appointment as
eHealth Ontario President and Chief Executive Officer. Ron Sapsford,
Deputy Minister of Health and Long Term Care, will serve as acting
President and Chief Executive Officer of eHealth Ontario until an
interim President and CEO can quickly be appointed.
“This decision is an important step to restore public confidence in the
agency and its mandate of modernizing our healthcare system.”
Sarah Kramer was hired as CEO last fall, when eHealth Ontario was formed
to spearhead the development of electronic health record systems across
the province. Said to be a priority for the provincial government,
eHealth Ontario has been given a budget of $2.1 billion for the next
The agency was established through the merger of the e-health program at
the Ministry of Health and Long-term Care and Smart Systems for Health
But under Sarah Kramer, previously a vice president and CIO at Cancer
Care Ontario, eHealth awarded nearly $5 million in contracts to
consulting agencies without issuing tenders.
Kramer defended her organization’s procurement policy, saying the need
to demonstrate quick results justified single-sourcing the contracts in
Examples of contracts handed out during the first months of eHealth’s
operation were $915,160 to healthcare consulting firm Courtyard Group,
and two contracts in a single day to Accenture Inc. that topped $1
Large salaries and bonuses also rankled the public and opposition
politicians. Documents show Kramer was earning a base salary of $380,000
and received a $114,000 bonus in March, about five months after her
start date. The next month, Kramer announced in a memo that the company
was cutting back on employee bonuses.
“After considerable discussion, we have decided to proceed with merit
and bonus payouts, but scale them back to reflect current economic
realities and the organization’s performance this past year,” the memo
Kramer’s own bonus had come under intense scrutiny, with critics asking
why such a large amount would be given after such a short a time on the
The eHealth CEO told reporters the bonus was to be paid by her previous
employer, Cancer Care Ontario, but that eHealth Ontario agreed to pay it
instead, as Kramer was hired on short notice. However, Terry Sullivan,
the CEO of Cancer Care Ontario went on the record as saying no
executives at the organization would be paid such a high bonus.
Senior executives at Cancer Care Ontario, a Crown agency, are eligible
for bonuses worth a maximum of 15 percent of their salary, Sullivan
said. And the 15 percent maximum is a policy eHealth also adheres to,
said agency spokeswoman Deanna Allen. Based on Kramer’s $380,000 salary,
that would’ve amounted to $57,000.
Ontario Auditor General Jim McCarter has been probing spending at
eHealth and its predecessor, SSHA, since late last year. His findings
are scheduled to be published in his annual report this December. Health
Minister David Caplan has asked McCarter to speed up the review after
facing a barrage of questions in the legislature.
Interim PC Leader Bob Runciman called for the health minister to explain
the apparent lack of competitive bidding for the projects and called the
expenses upsetting given the economic downturn.
Spending at eHealth and its predecessor swelled to more than $800
million in the past six years, while the date for release of its
electronic patient health records has been pushed back three years to
SSHA was blasted in January 2007 when an operational review done by
Deloitte Consulting said it lacked a strategic plan, had a poor
reputation among the healthcare community it was supposed to serve and
was not being held accountable by Queen’s Park.
Set up in 2002, SSHA also struggled to move away from a dependence on
consultants. A 2004-2005 annual report documents “intense” efforts to
reduce reliance on consultants by doubling permanent staff.
Media reports suggest SSHA spent about an average of 17 per cent of its
budget each year on consultants.
Also, two of eHealth’s consultants – Allaudin Merali and Donna Strating
– are listed as senior vice-presidents on the agency’s website but live
in Alberta, with their regular commute into Ontario funded by taxpayer
dollars. Documents show each charges about $2,700 a day for their
services. The two also bill the agency for regular flights,
accommodation in Toronto plus a per diem for meals and other costs.
The total cost for the two amounts to about $1.5 million a year.
EHealth’s CEO defended the costs of flying two consultants in, saying
Alberta has the “best record in eHealth in the country.”
“They’ve come in and really helped us get back on board and start moving
forward. So we’re paying market rates for people who are the best and
the brightest in the business,” Kramer said.