Government & policy

eHealth chair resigns, defends board of directors

TORONTO – Dr. Alan Hudson  (pictured) resigned in mid-June as chairman of the embattled eHealth Ontario agency. He has been replaced by Rita Burak, a former high-ranking civil servant in the Ontario government.

eHealth Ontario has come under public fire for the high salaries of its executives, for awarding untendered contracts to consulting firms and providing lucrative compensation to out-of-province consultants.

Dr. Hudson, who served as volunteer chairman, says he and the board of directors didn’t authorize CEO Sarah Kramer’s $380,000 annual salary or her bonus of $114,000 after five months on the job. Instead, said Dr. Hudson, the Ontario government hired Kramer as an order-in-council and authorized her salary and bonus.

Ms. Kramer’s compensation at eHealth, along with other financial payouts publicized by the CBC and other media outlets, appeared as ‘over-the-top’ to the public, especially in a time of recessionary cutbacks.

They triggered a scandal for the Ontario government, leading to the resignation of Ms. Kramer earlier in June, along with the resignations of several other executives at eHealth Ontario.

Dr. Hudson and the eHealth board were widely criticized in the press for having hired Ms. Kramer as CEO, as well as for overseeing untendered contracts to firms such as the Courtyard Group and Accenture. These contracts totalled some $5 million in a five-month period.

However, in an interview with the Toronto Star, Dr. Hudson says the eHealth board didn’t approve such contracts, but that Ms. Kramer arranged them to quickly get projects up and running.

He noted the urgency of producing results at the newly formed eHealth Ontario agency, which was created in the fall of 2008 after an investment of $647 million since 2002 in its predecessor, Smart Systems for Health Agency, had produced little impact on the delivery of healthcare in the province.

“There was pressure from the government to get the deliveries out the door,” Dr. Hudson said to the Toronto Star.

The public was also rankled by reports of Alberta-based consultants earning $2,700 or more per day and filing expenses for snacks such as tea, soft drinks, cookies and muffins.

Dr. Hudson said he was shocked to learn that consultants were making $2,700 to $3,000 a day and that one billed for a $1.65 tea at Tim Horton's and Choco Bites for $3.99.

The runaway spending and billing at eHealth Ontario, which has made national headlines, sent the government of Ontario premier Dalton McGuinty reeling. In accepting the resignation of Dr. Hudson, McGuinty said new rules will be in place going forward at government agencies.

The hiring of consultants will now have to go through tendered bidding. There will be no more sole-sourced contracts. And consultants will no longer be able to bill for out-of-pocket hospitality, incidental and food expenses, McGuinty said.

Meanwhile, the province’s auditor-general is reviewing spending at eHealth, and is expected to report as early as September. In addition, the consulting company PriceWaterhouseCoopers is also conducting a review.

McGuinty said health minister David Caplan will be keeping his job. “I continue to have confidence in Mr. Caplan,” he said.

For his part, Dr. Hudson said he had taken on too many responsibilities to provide adequate guidance. He is also head of Ontario’s Wait Times Strategy.

Said Hudson: “If I had to do it again, I would have dropped the one and gone over to the other. I had an awful lot on my plate.”