Opinion-Policy Nexus

Forest Heights Long-Term Care Centre in Kitchener, a for-profit nursing home, is at the epicentre of the COVID-19 crisis in Ontario’s Waterloo Region. As of last Thursday night, 45 Forest Hill patients had died.

That was 45 of 98 deaths in the region, which encompasses the cities of Cambridge and Waterloo, as well as Kitchener. To put it another way, one nursing home was responsible for 45 out of 79 deaths in all the long-term care (LTC) homes in the three cities.

Fixing the broken LTC system in Canada is not going to be easy, quick or cheap – and Forest Heights is as good a place as any to look at.

To start, Forest Heights is not locally owned. It is part of Revera Inc., a Mississauga-based chain that is Canada’s second largest owner (after Extendicare) of LTC homes and retirement residences.

All told, Revera owns 500 properties in Canada, the United States and the United Kingdom (where it is also in student housing). It houses 55,000 seniors and employs 50,000 people.

So who owns this for-profit giant? The answer is known to the LTC industry, if not to the general public. Revera is 100 per cent owned by the Government of Canada. Its board of directors is appointed by the Governor-in-Council, meaning the federal cabinet.

A search of Revera’s directors, turns up a familiar name, the chair emeritus (and still director) – one William Grenville Davis, of Brampton, Ont., the former premier of Ontario. (As an aside, another major player in the for-profit LTC business, Chartwell Retirement Residences, also has a former premier on its board; Mike Harris is Chartwell’s chair.)

The trail from Forest Heights in Kitchener through Revera to Justin Trudeau’s cabinet table passes through an important intermediary, known as PSP Investments. Full name: Public Sector Pension Investment Board. A Crown corporation with huge assets ($168 billion in 2019, striving for $250 billion by 2028) and a broad reach (investments in 75 countries), the PSPIB is the outfit that handles the pension contributions of federal public servants, Canadian Forces and the RCMP.

Back in 2007, the PSPIB purchased 100 per cent of a Reichmann family investment vehicle, Retirement Residences Real Estate Investment Trust, from its founder, Barry Reichmann, the eldest son of the late patriarch, Paul Reichmann (think Toronto’s First Canadian Place, New York’s World Financial Center and London’s Canary Wharf).

The price: $2.8 billion. The PSPIB absorbed the Reichmann REIT, renamed it Revera and set it loose to conquer the world of retirement living and long-term care. And so it did. Revera is now the second largest player in its field in the United States, as well as in Canada.

The PSPIB board reports to Parliament through the President of the Treasury Board (Jean-Yves Duclos) and, as with Revera, its directors are all appointed by the Governor-in-Council (aka the federal cabinet).

Interestingly, when the PSPIB chair, Michael Mueller, retired in 2018, the cabinet appointed him to the board of Revera; he then succeeded Bill Davis as the chair of the board.

The urgent task of fixing the broken LTC sector is bound to be complicated by the complexities of the facilities’ ownership. Many are corporately-owned for-profit enterprises; many, notably in Quebec, are still small, for-profit mom and pop businesses; at least one (Revera) is both publicly-owned and for-profit; some non-profits are privately-owned; some are owned by municipalities, others by charities.

An analysis in Saturday’s Toronto Star cited statistics showing that for-profit homes are the Achilles heel of long-term care in Ontario. A patient in a for-profit home is twice as likely to die of the coronavirus as a patient in a non-profit home and four times as likely as a patient in a municipally run home.

All LTC operators are regulated by the provinces, some of which do a better job of it than others. Provincial governments will face an almost impossible task to find a one-size solution to fit all LTC operations. And they won’t be able to come up with any solution that will work without a massive infusion of money from Ottawa.

A strong case can be made for the elimination of the profit motive in chronic care by making long-term care part of the public hospital system nationwide, subject to hospital standards of medical and personal care and safety precautions. Why, after all, should fragile seniors be treated with less concern and respect than the rest of the population?

Setting aside the thorny matter of constitutional jurisdiction, it would take a brave government, federal or provincial, to take on the for-profit LTC chains – rich, powerful and politically connected.

Unless, of course, a government happened to own one of those chains.

Is there any reason why Justin Trudeau could not pick up the phone and call the chap his government put in charge at Revera?  It could be a brief conversation: “Look, Michael, you’ve got a crisis in Kitchener. Forget the expense. Screw the profits. Fix Forest Heights and any other homes that are broken. Please fix them now! And keep them fixed!”

Isn’t it an owner’s prerogative to call the shots?

Posted

Monday, May 11, 2020 - 08:36