Alberta Premier Danielle Smith answers questions at a news conference while Health Minister Adriana LaGrange listens in the background in Calgary, on Feb. 19.Todd Korol/The Globe and Mail
Alberta Premier Danielle Smith has removed the deputy minister of health from his role to create separation from his other job as the sole administrator of the province’s health authority while investigators examine allegations that government officials interfered in the agency’s contract and procurement processes.
The Globe and Mail first reported the allegations, now contained in a lawsuit filed in February by Alberta Health Services’ former chief executive Athana Mentzelopoulos. Alberta terminated Ms. Mentzelopoulos on Jan. 8, which she alleges was two days before she was scheduled to meet with the Auditor-General to discuss what her internal investigations uncovered.
Ms. Smith said on Wednesday if there are problems with contracts and procurement at the provincial health authority, then the agency, rather than the government, will be at fault.
The government installed Darren Hedley, an associate deputy minister of health, as the acting deputy minister of health in place of Andre Tremblay, Ms. Smith said Wednesday. The government dismissed AHS’s board last month and named Mr. Tremblay as its sole administrator.
Critics had been calling for the removal of Mr. Tremblay as well as Health Minister Adriana LaGrange in the wake of the controversy. However, Ms. Smith stuck by the Health Minister on Wednesday.
Ms. Smith, standing alongside Ms. LaGrange, said AHS was responsible for negotiating deals with chartered surgical facilities, which are privately owned centres that perform operations at government expense. Ms. Mentzelopoulos, in her lawsuit, alleges government officials pressed her to strike deals with fees she considered inflated compared with AHS’s internal costs and that of a competing private firm.
Ms. Smith argued the alleged issues tied to contracts for chartered surgical facilities existed before Ms. LaGrange took over the health file in 2023.
“She had nothing to do with the procurement process,” Ms. Smith said. “This was all an internal AHS matter.”
Alberta Auditor-General Doug Wylie is investigating procurement and contracts at AHS and Alberta Health. Ms. LaGrange’s department has previously stated it will also investigate allegations of wrongdoing at AHS. On Wednesday, the Premier said the province will be setting up what she called a “legal conflicts wall” between the Health Ministry and AHS to “ensure the complete independence of these investigations without the involvement of the individuals named in the former CEO’s statement of claim.”
None of the allegations have been proven in court. Ms. Mentzelopoulos is seeking $1.7-million, the equivalent of what she would have been paid had her four-year contract not been cut short after just one year. Ms. LaGrange said she intends to file a statement of defence.
Ms. Mentzelopoulos, in her lawsuit, alleges the Premier’s then-chief of staff, Marshall Smith, put pressure on her to sign commitments with CSFs despite “significant concerns” around the true ownership of the firms and the inflated fees in the deals.
Ms. Smith, again, pinned any potential blame on AHS, which the government is dismantling into four health organizations, while transferring the agency’s purchasing responsibilities to Alberta Health.
“If there’s problems with the procurement process, we need to know, because many of the same people who are at AHS were the ones we were going to rely on in our new procurement secretariat,” Ms. Smith said. “If we need to find new people to do that, we need to know now.”
In an internal update to AHS staff, which was provided to The Globe, Mr. Tremblay said the change, which can be “difficult and unsettling,” will allow him to focus on his work at the health authority.
“This will allow me to prioritize leading AHS as we enter the final stages of our system refocusing initiative and position the organization for success in its future state as a hospital-based service provider – both of which are key to improving healthcare in Alberta,” he said.
Ms. Mentzelopoulos’s first review of CSFs began around the end of August, according to the lawsuit. Ms. LaGrange, in the press conference, said the former CEO first informed her of concerns last summer.
The government has insisted Ms. Mentzelopoulos’s termination was unrelated to her investigations.
Ms. Smith said she wants to know why, if Ms. Mentzelopoulos had concerns about AHS’s procurement, she did not disclose those fears to the minister. Ms. Mentzelopoulos, in her lawsuit, alleges Ms. LaGrange and other senior officials were aware of her investigations.
The Premier insisted that Alberta’s push for more private surgical facilities will not be derailed.
“AHS leadership has always shown us resistance, and it is clear that they would rather keep all surgeries in hospitals only operated by Alberta Health Services,” Ms. Smith said.
The former CEO alleges government stripped her of the power to negotiate and finalize CSF deals after she raised concerns over pricing.
Ms. LaGrange issued a directive on Oct. 18 declaring CSFs a “critical component” of Alberta’s health care system. The government is overhauling the health care system, and the five-page directive states that, because of those changes, Ms. LaGrange’s “department intends to take an enhanced role with respect to CSFs.”
The directive instructed AHS to execute a CSF contract extension. In December, exercising power authorized by the October directive, Alberta Health took control of two other CSF negotiations and ordered Ms. Mentzelopoulos to wind up her related investigation and give all documents and reports she had collected to the government.
Ms. Smith and Ms. LaGrange on Wednesday said the December order was necessary because the Health Minister had asked Ms. Mentzelopoulos to provide her with substantive evidence backing up the allegations of wrongdoing, but the executive failed to deliver.
Ms. LaGrange was doing her job – to ensure the government’s policy of expanding CSFs to reduce waiting times for surgeries, and to “hold administration to account for foot-dragging,” Ms. Smith said.
Infrastructure Minister Peter Guthrie last week demanded Mr. Tremblay be removed as deputy minister and as head of AHS until investigations into the allegations are complete. Mr. Guthrie also wanted the Health Minister to step aside from her portfolio but the Premier has said she is standing by Ms. LaGrange.