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Special Report
March 2012
Ornge Air Ambulance

and Related Services
Ofﬁce of the
Auditor General
of Ontario
Ofﬁce of the Auditor General of Ontario
To the Honourable Speaker

of the Legislative Assembly
I am pleased to submit to you my Special Report on

Ornge Air Ambulance and Related Services to lay
before the Assembly, as requested by the Minister of
Health and Long-Term Care and in accordance with
Section 17 of the Auditor General Act.
Jim McCarter
Auditor General
March 2012
© 2012, Queen’s Printer for Ontario
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ISBN 978-1-4435-9107-2 (Print) Cover photograph: Kevin Thom

ISBN 978-1-4435-9108-9 (PDF)
Table of Contents
Background 5
Audit Objective and Scope 6
Summary 7
Detailed Audit Observations 10
OVERVIEW OF THE PATIENT TRANSPORT PROCESS 10
ORNGE’S PERFORMANCE AGREEMENT WITH THE MINISTRY 11

Monitoring of Ornge’s Performance 12
Funding Provided to Ornge 14
Monitoring of Ornge Spending 15
Ornge’s Transactions With Entities It Controls or
Of Which It Is a Beneficiary 16
Ornge Global 17
Debt Financing of Air Ambulance Services 19
Significant Purchases 20
Corporate-head-office Space 20
Aircraft 22
LAND AMBULANCE SERVICES 25
Ornge’s Commencement of Critical-care
Land Ambulance Services 25
Deployment of Land Ambulances 26
Cost and Use of Land Ambulances 26
4 Special Report
DISPATCH OF AMBULANCES 28
Selection of Ambulances and Flight Planning 28
Co-ordination with Hospitals and
Municipal Land Ambulances 29
Level-of-care Determination and
Paramedic Staffing of Ambulances 29
Cancelled after Launch 30
Not-serviced Calls 30
New Dispatch System 32
RESPONSE TIMES 32
Call-receipt Process 33
Reporting Response Times 33
Call Receipt to Acceptance 33
Acceptance to Departure 34
Departure to Arrival 35
OVERSIGHT OF OPERATIONAL ACTIVITIES 36

Ministry Service Reviews 36
Compliance with Aviation Requirements 36
Ornge Reviews of Service Providers 36
Complaint Investigations 37
Incident Reporting 37
Ornge Clinical Quality Assessment 38
Special
Report Ornge Air Ambulance
and Related Services
care services being provided by external entities

Background accountable to the Ministry.
Under the original contractual arrangement,
the Corporation was primarily to provide air ambu-
The Ambulance Act (Act) requires that the Minister
lance services. Under a subsequent amendment,
of Health and Long-Term Care ensure the “existence
the Corporation was also to provide certain land
throughout Ontario of a balanced and integrated
ambulance services.
system of ambulance services and communication
The Corporation changed its name to Ornge
services used in dispatching ambulances.” The Act
(the name reflects the colour of the company’s
further states that the “Minister has the duty and
aircraft and corporate logo and is not an abbrevia-
the power to fund and ensure the provision of air
tion). Ornge and its associated companies employ
ambulance services.”
more than 400 people, including paramedics, pilots
Until about five years ago, the Ministry of Health
and aviation specialists. Ornge has its own aircraft
and Long-Term Care (Ministry) contracted with
and land ambulances, stationed at 12 bases across
private operators to provide its air ambulance pro-
Ontario. It also contracts with independent service
gram’s aircraft, pilots and paramedics. The Ministry
providers throughout the province to transport
directly operated the central air ambulance dis-
patients. These subcontractors have their own
patch centre and was responsible for overseeing the
aircraft and pilots, and generally employ their own
overall effectiveness of the air ambulance program.
paramedics, although one uses Ornge paramedics.
In 2005, the Ministry announced that it was
In the 2010/11 fiscal year, Ornge was respon-
appointing a not-for-profit corporation called the
sible for the transport of more than 19,000 patients,
Ontario Air Ambulance Corporation (Corpora-
medical teams and organs for transplant (subse-
tion) to become responsible for all air ambulance
quently referred to as patients). More than 90%
operations. This was done partly to address an
of these are “inter-facility” transfers of patients
independent accreditation review that recom-
between health-care facilities. Figure 1 provides a
mended clearer lines of authority among the
breakdown of total transports in 2010/11.
different components of Ontario’s air ambulance
Ornge received $150 million in ministry funding
operations. Having an arm’s-length corporation
in the 2010/11 fiscal year. It also borrowed about
deliver air ambulance services was also consistent
$300 million between June 2009 and January 2011
with the Ministry’s long-term objective of moving
to finance various items, including the purchase of
away from direct service delivery, with health-
aircraft and a new head-office building. This debt
5
6 Special Report
We conducted our audit work primarily at Orn-

Figure 1: Total Patient and Other1 Transports, 2010/11
Source of data: Ornge
ge’s head office, and we went to an Ornge base that
houses air and land ambulances. We also conducted
Type of Patient Transfer Number 2 work at the Ministry; reviewed relevant files, sys-
Transfers conducted only with Ornge-owned vehicles tems and administrative policies and procedures;
On-scene emergency airlifts 437 interviewed Ornge and ministry staff; reviewed
Other air ambulance transports3
6,382 relevant research obtained from air ambulance pro-
Land transfers3 1,487 grams in other jurisdictions in Canada and around
Total 8,306 the world; and spoke with senior management from
Transfers conducted with both Ornge-owned and other Canadian air ambulance programs.
private-operator vehicles
In addition, we reviewed and analyzed Ornge’s
Air transports 596
data on requests for air ambulance services, as well
Total 596
as several of its more significant transactions. We
Transfers contracted out by Ornge
also engaged independent consultants with expert
Private-operator air transports3 7,858
knowledge of air ambulance services, property
Scheduled commercial airline flights4 1,174
appraisals and real estate law to assist us.
TEMS5 land transfers3 1,340
Ornge’s management, with the approval of
Total 10,372
Ornge’s board, created a number of for-profit and
Total 19,274
not-for-profit subsidiaries and other compan-
1. About 3% of transports are for organs and medical teams.
2. An individual patient transported by both land and air is counted in both
ies. The relationships between these entities are
the land and air transport numbers. There were 273 of these instances complex. Ornge has entered into financial arrange-
in 2010/11.
3. Primarily the inter-facility transport of patients. ments with many of these entities—for example,
4. To transport people to medical appointments; no paramedic required.
5. Toronto Emergency Medical Services, which conduct land transfers under
they provide most of Ornge’s air ambulance and
an agreement with Ornge. administrative services and then bill Ornge for the
cost of services rendered. Ornge advised us that
is included in the provincial debt in the province’s
these complex interrelationships were necessary
consolidated financial statements. Ornge uses
to meet legal, tax and other objectives relating to,
ministry funding to make the required financing
among other things, acquiring new sources of fund-
payments on this debt.
ing to enhance its services.
In order for us to fully understand the fiscal and
operational context of Ontario’s air ambulance ser-
Audit Objective and Scope vices, we requested a number of documents relating
to these arrangements. We were given access to
only those documents relating to entities that were
Our audit objective was to assess whether air ambu-
controlled by Ornge or of which Ornge was the
lance and related services were:
beneficiary. We were refused access to the records
• meeting the needs of Ontarians in a cost-
of any of the other entities. Ornge’s management
effective manner; and
and the board advised us that this was because the
• in compliance with ministry and legislative
Ministry was not funding the other entities directly
requirements.
or indirectly (under the Auditor General Act, we
Senior management at the Ministry and Ornge
are generally allowed access only to organizations
reviewed and agreed to our audit objective and
funded by the government). Examples of records
associated audit criteria.
that we were unable to access to included:
Ornge Air Ambulance and Related Services 7
• lists of the shareholders or owners of these

other entities and what each individual’s pro- Summary
portionate ownership interest was;
• the “Founders’ Equity Plan,” which we under-
The Ministry has a responsibility to ensure that the
stand includes potential monetary benefits for
services it is paying for are being provided cost-
initial shareholders of these entities;
effectively and that Ornge is meeting the needs
• compensation contracts and bonus arrange-
of the public and Ontario’s health-care system. In
ments for members of senior management
outlining its plans to the Standing Committee on
and the board who were receiving remunera-
Public Accounts in February 2006 regarding the
tion through these entities;
corporation that would be responsible for Ontario’s
• the agreement relating to a payment of several
air ambulance services, the Ministry committed
million dollars that a European corporation,
to set standards and monitor performance against
which had sold aircraft to Ornge for $148 mil-
those standards to ensure that the “end result
lion, made to one of these entities to provide
will be improved care, improved access to service,
future marketing and other services (Ornge
increasing effectiveness and efficiency of the deliv-
told us the payment was about $4.8 million,
ery of service, and the assurance of greater fiscal
although a higher amount has been subse-
and medical accountability.” As well, the Ministry’s
quently reported); and
original submission to Management Board of Cab-
• records from the entities that provide Ornge’s
inet requesting approval for the Ornge arrangement
aviation, purchasing, payroll and accounting
specified that obtaining and evaluating perform-
services, and that bill Ornge for the cost of
ance information of this nature would be an essen-
these services.
tial part of the Ministry’s oversight function.
Accordingly, the scope of our work generally
However, the Ministry has not been obtaining
excluded any observations that we might have
the information it needs to meet these oversight
made had we obtained full access to these records.
commitments. For instance, it does not periodically
Our work did not focus on administrative processes
obtain information on the number of patients being
such as general purchasing, accounts payable and
transferred or assess the reasonableness of the cost
employee expenses because a consultant engaged
of the services being provided on a per-patient basis
by the Ministry’s internal auditors had already con-
(something it could do by comparing Ontario’s
ducted a review of Ornge’s administrative processes
costs to costs being incurred in other jurisdictions
that covered a number of these areas.
or examining changes in Ontario’s average costs
In January 2012, the Ministry essentially took
over time). We noted in this regard that the fund-
over Ornge— an interim president and CEO was
ing Ornge received for air ambulance services
appointed and Ornge’s board of directors was
increased by more than 20% between the 2006/07
replaced. The Ministry also sent in a large team
fiscal year (Ornge’s first full year of operations) and
of forensic auditors to investigate issues such as
the 2010/11 fiscal year. However, over the same
Ornge’s arrangements with the companies created
period, the total number of patients transported
by Ornge’s management. We therefore did not
by air decreased by 6%. Also over the same period,
conduct any further work or request any additional
Ornge received $65 million to perform inter-facility
documentation after that time.
land ambulance transfers, projected to number
20,000 annually. However, Ornge is currently pro-
viding only about 15% of the projected transfers.
8 Special Report
From a quality-of-care perspective, the Min- operation is being delivered by these other
istry receives limited information on whether entities, which bill Ornge for those services. In
requests for patient pick-up and transfer are being a detailed January 2011 letter to the Minister
responded to in a timely and appropriate manner or of Health and Long-Term Care, Ornge outlined
whether patients are receiving the appropriate level its plans to establish a number of independent
of care during transport. As well, we questioned for-profit companies effective January 1, 2011.
whether the Ministry had adequate oversight over These entities were not covered by the per-
Ornge’s procurement practices and its intercom- formance agreement Ornge has with the Min-
pany arrangements with management and the istry, and therefore the Ministry would likely
board to ensure that Ornge was following appropri- not have access to the records of these entities.
ate public-sector business practices. Despite this, however, the Ministry did not
We suspected that the changes Ornge made to obtain sufficient additional information about
its corporate structure were not contemplated when these entities. As a result, the Ministry cannot
the Ministry originally negotiated the perform- periodically spot-check whether the costs
ance agreement that governs the accountability incurred by these entities and billed back to
relationship between the two parties. The Ministry Ornge are reasonable or whether potential
acknowledged this and indicated that these chan- conflicts of interest have been avoided. Avoid-
ges hindered its ability to obtain the information ing potential conflicts would be especially
needed to exercise adequate oversight. important given that the January 2011 letter
It should be acknowledged that Ornge has made indicated that some members of Ornge’s
improvements to certain aspects of service delivery, management and board were shareholders of
including a new paramedic training program, certain of these entities.
and ongoing upgrades to the dispatch system to •
The building that houses Ornge’s corporate
improve functionality and reliability. It has also head office was purchased for $15 million
assumed additional responsibilities, including cer- using funding borrowed through a bond
tain critical-care land ambulance services in 2008. issue. Ornge then entered into a complex
Furthermore, Ornge has obtained and maintained arrangement with some of the other entities
certification by the International Commission on it created to sell the building and lease it back
Accreditation of Medical Transport Services. Con- to itself. An independent real-estate appraiser
sequently, some increase in operating costs may be we engaged estimated that, under its lease
justified. However, the Ministry needs better infor- with a related Ornge company, Ornge’s rent
mation if it is to ensure that the increase in annual payments are 40% higher than the fair-market
funding has been well spent on improving the time- rent. Over the first five years of the 25-year
liness, volume and quality of services provided. lease, this amounts to Ornge paying $2 mil-
Examples of areas about which the Ministry had lion more than it would pay if the building’s
not been receiving the information it needed for cost per square foot were comparable to
proper oversight and which would have warranted that of similar buildings in the area. Ornge’s
follow-up included the following: above-market rent enabled one of the entities
• Ornge management, with approval of its involved in the arrangement, Ornge Global
board, created a network of for-profit and Real Estate, to obtain $24 million in financing
not-for-profit subsidiaries and other com- for the building that Ornge paid $15 million
panies with which Ornge has entered into for. We understand that the $9 million “profit”
complex financial arrangements to deliver air generated as a result was being flowed to a
ambulance services. In fact, much of Ornge’s company called Ornge Global Holdings LP for
Ornge’s future purchase of limited partner- building. Ornge recently informed us that the
ship (ownership) units of that company. At second motorcycle may still be with Orange
the time of our audit, Ornge Global Holdings County Choppers in the United States.
LP was owned by members of Ornge’s senior •
We understand that in August 2010, the
management and the board. European helicopter manufacturer agreed to
•
Previously, Ontario’s air ambulance oper- pay Ornge another $4.8 million (subsequently
ations contracted with various private-sector reported to be a higher amount) for future
aircraft providers to transport patients. Ornge marketing and other services. Shortly after
decided that, rather than relying on private- our audit fieldwork began, the responsibility
sector operators, it would purchase new for this contract was retroactively transferred
helicopters and airplanes to provide much of from Ornge to one of the for-profit corporate
Ontario’s air ambulance services. Because of entities that we were refused access to, and,
certain features that Ornge wanted its aircraft as noted in the Audit Objective and Scope sec-
to have, an open public competitive tender tion, we were unable to review the contract as
was not used. Rather, three helicopter and part of our audit.
two airplane suppliers were invited to bid. •
In addition to purchasing 12 new helicopters,
Although Ornge’s own analysis indicated nine Ornge spent $28 million for 11 used and aging
helicopters and six airplanes were needed, helicopters, planning to use them for less than
Ornge purchased 12 new helicopters and 10 two years while it waited for the new ones to
new airplanes. Ornge advised the Ministry be delivered. At the time of our audit, Ornge
that the excess capacity could be made avail- told us it believed this would be more cost-
able to its other business ventures. effective than entering into another service
•
After buying 12 new helicopters for agreement with the service provider. Ornge
US$148 million, Ornge arranged to install obtained an external consultant’s opinion
seating for 12 people in two of them. As a that supported its decision. At the time of our
result, these helicopters could not be used to audit, Ornge was in the process of disposing of
transport patients. Ornge told us it was con- the 11 used helicopters for what was expected
sidering selling these two helicopters. to be less than $8 million.
•
After Ornge bought the 12 helicopters, their •
Ornge has borrowed almost $300 million to
European manufacturer agreed to donate finance, among other things, the purchase of
US$2.9 million to Ornge’s charitable founda- the 12 new helicopters, 10 new airplanes, the
tion “to provide improved patient care and 11 used helicopters and the new office build-
facilitate the education and training of trans- ing. This debt is included in provincial debt
port medicine professionals.” Of this amount, in the province’s financial statements, and
US$500,000 was spent to have two custom- the Ministry is funding the ongoing financing
made motorcycles built and to use them payments.
to promote Ornge, including having them •
At the time of our audit, there was a lack of
appear on American Chopper, a television transparency surrounding the compensation
show featuring a California company called of many senior management staff and board
Orange County Choppers that makes custom members. (Since that time, at the request of
motorcycles. One of the motorcycles was also the Ministry, Ornge has publicly disclosed
used in a promotional event at a Blue Jays certain of these compensation payments.)
baseball game and at the time of our audit •
Since the 2007/08 fiscal year, the Ministry has
was on display in the lobby of Ornge’s office given Ornge more than $13 million annually to
10 Special Report
provide certain inter-facility transfers by land professionals who responded said that Ornge
ambulance without finding out how many rarely or never provided inter-facility ambu-
transfers Ornge has actually made, the type of lance service within a “reasonable time.”
transfers or whether this transfer arrangement The Ministry also needs to consider the long-
is cost-effective. In fact, Ornge is currently term impact of Ornge having created its own airline
providing only about 15% of the 20,000 trans- and relying much less on other well-established air
fers it initially projected. As a result, the cost ambulance service providers. Significant depend-
per patient that Ornge is incurring for these ence on one service provider poses potential risks,
transfers is about $7,700. This is much more especially if other private-sector air ambulance
than the $1,700 per patient that Ornge pays providers can no longer stay in business. With fewer
Toronto Emergency Medical Services to pro- potential service providers, the Ministry will have
vide inter-facility patient transfers on its behalf reduced negotiating power in future funding agree-
and almost as high as the cost Ornge incurs ments because it will have no option but to rely on
to transport a patient by air ambulance. The Ornge for the delivery of Ontario’s air ambulance
Ministry made the arrangement with Ornge services.
because municipalities prefer to devote their It should be acknowledged that, as a result of
ambulance resources to emergency calls rather our bringing a number of these observations to the
than use them for inter-facility transports. Ministry’s attention during the course of our audit,
The arrangement also included providing as well as later media reports concerning Ornge,
Ornge with funding to purchase its own land the Ministry has recently taken substantive action
ambulances. to address many of the issues raised in this report.
• Ornge’s dispatch system does not automatic- Certain issues will take additional time to resolve in
ally record the times of key events in the the most cost-effective manner given that Ornge’s
dispatch and patient transfer process. Without first priority must be to ensure the safe and timely
this information, it is difficult to objectively transport of patients needing air ambulance and
assess Ornge’s success in meeting the two per- related services.
formance standards for responding to requests
for an air ambulance. In those cases where rel-
evant data was entered, we were able to deter-
mine that Ornge was successful in responding
Detailed Audit Observations
to about 85% of on-scene emergency calls
within 10 minutes of call receipt, the required OVERVIEW OF THE PATIENT TRANSPORT
standard. However, only about 40% of the PROCESS
emergency and urgent inter-facility calls were
Ontario covers an area of over 1 million square
accepted or declined within 20 minutes of
kilometres, with much of northern Ontario sparsely
call receipt. Although Ornge has reported it
populated. This makes meeting patient needs for air
almost always meets the performance agree-
ambulance services in a cost-effective manner an
ment standard, it measures this time from
ongoing challenge.
when it has obtained all patient details, not
More than 90% of the calls Ornge responds
from the time of the call receipt, which we
to are transfers of patients from one hospital to
believe to be a more applicable benchmark
another rather than on-scene accident transports.
from the patient’s perspective. Our analysis
Generally, the Ornge Communication Centre
is also more consistent with the results of a
(Centre) arranges flights after requests from either
survey in which almost half of the medical
a physician or CritiCall, an organization funded by

Figure 2: Selected Criteria for Dispatching Ornge
the Ministry of Health and Long-Term Care (Min-
Ambulances
istry) that helps arrange transfers. Land ambulance Source of data: Ornge
dispatch centres operated primarily by the Ministry
or municipalities may also ask the Centre to pick up Criteria for Air Transport
persons injured in an accident. Ornge will typically Transport distance exceeds 240 km
approve an air or land ambulance if certain criteria Patient location has no roads that land ambulance can use
are met, examples of which are described in Fig- Land ambulance would take more than 30 minutes to reach
emergency patient at accident scene
ure 2. Ornge’s transport-medicine physicians, with
Criteria for Land Transport
expertise in emergency medicine and critical care,
Critically ill patient requires transfer to another hospital and
generally make the final decision on whether to the transport-medicine physician has determined the patient
send an ambulance. can travel safely by land
Ornge’s computerized dispatch system deter- Patient meets air ambulance criteria but circumstances such
mines the level of care a patient needs during as bad weather prevent flight from taking off
transport and then identifies paramedics with the
appropriate qualifications (basic primary care, ment with Ornge. In the following sections, we
intermediate advanced care, or extensive critical raise some issues regarding this agreement and the
care) to provide the service. If the appropriate Ministry’s monitoring of Ornge.
paramedics are not available for inter-facility trans-
fers, a hospital escort, such as a nurse, may need to
ORNGE’S PERFORMANCE AGREEMENT
accompany a patient.
WITH THE MINISTRY
Once they reach a patient, paramedics stabilize
the individual as required and transfer him or her In 2005, the Ministry was operating Ontario’s air
to the ambulance. An Ornge transport-medicine ambulance service, with a division of Sunnybrook
physician provides medical guidance to paramedics Health Sciences Centre in Toronto providing
as needed during this process. Ornge paramedics medical oversight. At that time, it contracted with
are also responsible for completing a call report private operators to transport patients, using these
within 24 hours of delivering the patient, which is operators’ aircraft, pilots and paramedics. In our
provided to the admitting hospital. 2005 Annual Report, we raised a number of service-
When Ornge assumed responsibility for air delivery issues and noted the observation by the
ambulance services, it identified a number of issues Commission on Accreditation of Medical Transport
that it planned to address. Some examples were the Systems (an independent American organization)
need for a communications centre disaster recovery that the system had no clear lines of authority. That
plan, aging information technology systems, aging year, Management Board of Cabinet decided to
assets and a lack of performance metrics. Ornge award the contract for Ontario-wide air ambulance
has made a determined effort to improve the air services, without a competitive process, to the
ambulance system, including updating the dispatch Ontario Air Ambulance Services Corp (Corpora-
system and furthering paramedic training. The tion), which was renamed Ornge in 2006. The
Ministry is the steward of Ontario’s air ambulance Corporation was a small organization based at
system and, although it gave Ornge responsibil- Sunnybrook that was providing medical oversight
ity for service delivery, it is still responsible for for Ontario’s air ambulance service. As a result of
ensuring that Ornge is meeting patient needs in a the contract, the Corporation acquired the Min-
cost-effective manner. Much of its ability to do so istry’s air ambulance assets, such as its dispatch sys-
is governed by the Ministry’s performance agree- tem and the right to use the air ambulance bases.
12 Special Report
The contract, which was essentially a performance to Management Board of Cabinet for approval to
agreement, became effective in January 2006 and outsource air ambulance services, the Ministry
has no expiry date. committed to establishing performance standards
The decision to appoint a single new supplier and monitoring the performance of its external
to meet the needs of the entire province, rather service provider against those standards. In par-
than, for example, conducting a public request for ticular, in outlining its plans for the Corporation
proposals or continuing to contract with a variety (later renamed Ornge) to the Standing Committee
of established regional service providers, was a on Public Accounts in February 2006, the Ministry
policy choice of the government. The government’s committed to set standards and monitor perform-
objectives in making this choice included improv- ance against those standards to ensure that the
ing patient care and optimizing safety, increasing “end result will be improved care, improved access
efficiency and integration with the health-care to service, increasing effectiveness and efficiency
system, and developing and renewing human and of the delivery of service, and the assurance of
technological resources. In a July 2005 announce- greater fiscal and medical accountability.” As well,
ment, the Ministry said that “having all air ambu- the Ministry’s original submission to Management
lance services under one organization will make the Board of Cabinet requesting approval for the Ornge
system more accountable, more efficient, and easier arrangement specified that obtaining and evaluat-
for front-line health-care workers and Ontarians to ing performance information of this nature would
use and to trust.” be an essential part of the Ministry’s oversight
The performance agreement gave Ornge respon- function. Performance measures, if well defined
sibility for making all key operating decisions relat- and specified in a performance agreement with its
ing to the service it was to provide, including: service provider, would be a critical step in enabling
• how to provide service (for example, whether the Ministry to ensure that Ornge was meeting
to use Ornge’s own aircraft or to contract with patient needs in a cost-effective manner.
private operators); We noted that the performance agreement did
• how many and which type of aircraft are to be contain a number of administrative and reporting
available for use; requirements that Ornge must comply with. For
• how to establish and evaluate medical example, Ornge must establish procurement poli-
oversight; cies that are consistent with government policies
• when to dispatch ambulances and which type and directives. There are also various operating
of transport to choose; and requirements—Ornge must ensure that medical
• which paramedics, based on level-of-care staff are qualified, maintain the confidentiality
qualifications, should assist each patient of sensitive information and document each call
transported. manually if electronic recording is unavailable. The
In light of the high degree of responsibility and agreement also states that the Ministry can termin-
decision-making power the performance agree- ate the agreement if Ornge does not comply with
ment gave Ornge, it was important for the Ministry the requirements within a certain time. However,
to have adequate processes in place to protect its the performance agreement has only two specific
interests. and measurable response-time requirements relat-
ing to requests for air ambulance services. As well,
we understand that the additional corporate enti-
Monitoring of Ornge’s Performance
ties that Ornge unilaterally created were not cov-
Both in appearances before the Standing Com- ered by the performance agreement, even though
mittee on Public Accounts and in its submission they were providing a number of key services.
The Ministry reviews Ornge’s funding needs as impact on the delivery of air ambulance servi-
part of its annual estimates process and receives ces in Ontario.
from Ornge an annual budget, audited financial We had similar concerns based on our review of
statements, five-year business plans and quarterly more recent information. For example, although
financial reports. The Ministry advised us that, Ornge provided the Ministry with its first balanced
in addition, it meets periodically with Ornge to score card in 2009, the score card did not contain
discuss plans and issues. The Ministry also reviews the kind of performance information that would
Ornge every three years for compliance with ser- allow the Ministry to assess the level of service
vice requirements specified in the Ambulance Act, in Ornge was providing relative to the costs it was
much the same way that it reviews land ambulance incurring. One reason for this is that the perform-
service providers. However, it does not routinely ance agreement does not specify the service expect-
receive basic operational data, such as the number ations, performance indicators or other information
of patient transports by type of transport and the that the balanced score card ought to include.
average cost of transports. Ornge’s descriptions of its accomplishments
In 2008, the Ministry contracted through its were quite brief and not very helpful in assessing
Internal Auditor to have a special review done to performance. For example, one activity was to
determine whether Ornge was complying with sev- “review and revise [the] Ornge Communications
eral aspects of the performance agreement and had Centre processes related to requests for service.”
adequate administrative processes in place. The Ornge reported that it had complied with this
review covered the period from Ornge’s commence- requirement, stating that the “process for call triage
ment of air ambulance operations to November and level of care required has been reviewed.” How-
2008. It focused on the 12-month period ending ever, it did not provide the Ministry with the results
March 31, 2008. The results, issued in September of this review or any related actions taken. The
2010, indicated that Ornge had a number of good Ministry did not request additional information or
policies and processes in place to manage its affairs verify the accuracy of the information it received.
economically and efficiently. The review also made At the time Ornge and the Ministry entered
several recommendations to further strengthen into the performance agreement, the information
some of Ornge’s internal management processes systems the Ministry was using could not provide
and to improve communications between the all the information needed to effectively monitor air
Ministry and Ornge. They included improving the ambulance operations. Therefore, it may have been
timeliness and usefulness of the information Ornge initially difficult to establish targets and other per-
reported to the Ministry. Examples of the review’s formance measures that Ornge could readily report
findings included the following: on. However, at the time of our audit five years
• The performance report, called a “balanced later, there were still few measures in place. We
score card,” that the performance agreement believe the Ministry ought to have established more
required Ornge to complete every year begin- specific performance expectations and obtained
ning in July 2007 had not been provided. reports more regularly from Ornge comparing
• There had been disagreements regarding each actual performance to those expectations.
party’s interpretation of performance agree- The performance agreement has two air ambu-
ment provisions that required clarification lance response-time indicators: one is how long
and agreement. Ornge takes to determine its ability to respond
• The Ministry needed to obtain more comfort to an on-scene call, and the other is how long
regarding Ornge’s corporate structure and its Ornge takes to determine its ability to respond to a
request for an inter-facility transfer. But other key
14 Special Report
performance indicators are not reported on, such as those in a hospital intensive-care unit who
as the percentage of requests being serviced and require transfer to another hospital; and
the percentage of calls where an air ambulance • $3.7 million in the 2007/08 fiscal year and
was supplied at the appropriate level of care. Other $6.6 million in each fiscal year thereafter to
important information needed for monitoring provide more air ambulance services through
performance would include the main reasons for two additional aircraft (the Ministry indicated
which requests could not be serviced. that this funding was originally to provide
air ambulance support for the Thunder Bay
angioplasty program, but only three of the
Funding Provided to Ornge
program’s patients have required an air
Under the agreement between the Ministry and ambulance since the program began, and
Ornge, Ornge was to receive $111 million in therefore Ornge used this funding for regular
provincial funding for the 2006/07 fiscal year and operations).
$115 million a year in each of the next four fiscal The 2004/05 fiscal year was the last full fiscal
years, along with possible additional funding for year in which the Ministry provided air ambulance
increased costs. The Ministry and Ornge were to services, and it spent $93 million on them. In
annually negotiate the amount of funding thereafter 2005/06, the Ministry delivered the services for
(there is no end date in the agreement). Figure 3 the first nine months of the fiscal year at a cost of
summarizes actual ministry funding to Ornge from $73.7 million and provided Ornge with $30.9 mil-
the commencement of Ornge’s air ambulance oper- lion plus $5.1 million in transitional funding to
ations in January 2006 to the 2010/11 fiscal year. provide the services for the last three months. The
Since the Ministry and Ornge signed the agree- number of patients transported that year increased
ment, the Ministry has given Ornge increases aver- by 5%.
aging about 4% each year on top of the contracted The 2006/07 fiscal year was the first full fis-
amount. As well, the Ministry provided additional cal year of Ornge’s operations, and the Ministry
funding for specific initiatives that it introduced gave Ornge $112 million to provide air ambulance
since signing the agreement. For example: services plus an additional $9.4 million in one-time
• $9.4 million in one-time start-up funding in funding to establish the land ambulance program.
the 2006/07 fiscal year to create a land ambu- While the Ministry had no analysis supporting the
lance program for the inter-facility transfers of reasonableness of the $112 million, it indicated
certain patients; that it based the amount negotiated with Ornge
• $13 and $16 million in the 2007/08 and on past expenditures and on anticipated increases
2008/09 fiscal years, respectively, and then resulting from expected future renegotiations of air-
$13 million starting in 2009/10, with annual carrier contracts. However, there is no documented
increases thereafter, to provide land ambu- explanation for the $19-million, or 20%, increase
lance services to critically ill patients, such from what the Ministry spent in 2004/05. The
Figure 3: Ministry Funding to Ornge, January 2006–2010/11 ($ million)

Source of data: Ministry of Health and Long-Term Care
Type of Funding Jan–Mar 2006 2006/07 2007/08 2008/09 2009/10 2010/11 Total
Air ambulance 36.0 111.5 121.2 126.6 131.1 135.9 662.3
Land ambulance — 9.4 13.2 16.2 13.1 13.7 65.6
Other — 0.4 0.7 1.1 — — 2.2
Total 36.0 121.3 135.1 143.9 144.2 149.6 730.1
increase in the total number of patients transferred funding it would provide for Ornge to take on these
between 2004/05 and 2006/07 was 2%, excluding land ambulance responsibilities. In total, patient
the transfers that Toronto Emergency Medical Ser- transports have stayed about the same over the
vices performed that were dispatched by Ornge but four-year period.
were directly funded by the Ministry.
We noted that in 2006, at a hearing on our 2005
Monitoring of Ornge Spending
audit of air ambulance services that the Standing
Committee on Public Accounts conducted, the For a variety of legal and business reasons, Ornge
Committee Chair questioned a ministry official created a number of organizations between 2006
about whether the agreement with Ornge would and 2010. They include:
result in a “more expensive, costly system.” The • Ornge Peel, which provided administra-
official replied, “The agreement with [Ornge] calls tive support such as human-resources and
for the same funding that we have in the base at accounting services, and which employed
the Ministry of Health and Long-Term Care for air most of Ornge’s senior executives; and
ambulance. It will be no more expensive [than] for • Ornge Issuer Trust, a financing vehicle for
the government to provide that type of service.” Ornge, which issued bonds in 2009 (we
Factoring in the above additions, including discuss this transaction in detail in the Debt
the 4% average annual increase, annual ministry Financing of Air Ambulance Services section).
operating funding to Ornge increased by more than The boards of directors of these organizations
30% in the first four full fiscal years that Ornge were composed entirely or primarily of the individ-
delivered the service. By 2010/11, Ornge was uals who comprised Ornge’s board.
receiving $150 million a year, about 90% of which Subsequent to January 1, 2011, Ornge no longer
related to air transports. Over the same four-year controlled the two organizations providing most
period, the number of patients transported by air of the services to Ornge on a cost-recovery basis.
decreased by about 7%, as shown in Figure 4. The Furthermore, in 2011, almost all of Ornge’s senior
number of land transports in 2010/11—more than management became employees of a new for-profit
2,800—was far lower than the number the Ministry international business they began operating. It
had anticipated when it determined how much included such companies as Ornge Global Air Inc.,
Figure 4: Number of Patient and Other Transports1 by Type, 2006/07–2010/11

Transport Type 2006/07 2007/08 2008/09 2009/10 2010/11

Air Transport
Air ambulance flights 16,286 14,895 15,355 15,691 15,273
Scheduled commercial airline flights2 1,331 1,215 950 1,102 1,174
Total 17,617 16,110 16,305 16,793 16,447
Land Transport 3
Ornge — 34 556 1,365 1,487

Toronto Emergency Medical Services 1,8084 1,449 1,342 1,117 1,340
Total 1,808 1,483 1,898 2,482 2,827
Grand Total 19,425 17,593 18,203 19,275 19,274
1. Up to 3% of transports are for organs or medical teams.
2. To transport people to medical appointments where no paramedic is required.
3. An individual patient transported by both land and air is counted in both the Air Transport and Land Transport numbers.
4. In 2006/07, the Ministry directly funded Toronto Emergency Medical Services for land ambulances dispatched by Ornge.
16 Special Report
Ornge Global Corporate Services Inc. and Ornge The performance agreement also requires Ornge
U.S. Inc. (collectively referred to as Ornge Global to periodically submit various financial reports
and described further in the Ornge Global section). to the Ministry. These include quarterly variance
Ornge has made complex financial arrange- reports that explain any differences between
ments with many of these companies. One example planned and actual expenditures. The variance
involves Ornge Issuer Trust, which owns the air- reports have generally been submitted each year
plane and helicopter ambulances and leases them but in most cases lacked detailed explanations. We
to Ornge Global Air Inc. Ornge guarantees the lease noted that the Internal Audit review that the Min-
payments and will pay them if Ornge Global Air Inc. istry commissioned also recommended that Ornge
does not. In turn, Ornge Global Air Inc. subleases include more detail in its explanations of variances.
all helicopter air ambulances to an external air We agree.
ambulance service provider under agreements that Ornge is also required to submit audited finan-
are to expire March 31, 2012. Ornge then contracts cial statements within three months of the end of
to have Ornge Global Air Inc. provide service either the fiscal year. Since the 2008/09 fiscal year, Ornge
through contracts with independent service provid- has consolidated the financial-statement informa-
ers (including the one that leases the helicopters tion of entities it controls or is the beneficiary of in
from Ornge Global Air Inc.) or with its own leased its audited financial statements. The Ministry’s per-
aircraft and pilots. Ornge Global Air Inc. charges formance agreement with Ornge does not require
Ornge for the aviation services, including associ- a further breakdown by consolidated entities.
ated administration costs, whether it provided the Therefore, at the time of our audit, the Ministry did
services directly or through a service provider. not have the information needed to separate out
The performance agreement allows the Ministry the many transactions that involve Ornge’s consoli-
to examine those Ornge records that relate to dated entities from those that do not.
service provision. But it does not allow the Ministry The agreement also requires Ornge to submit
to recover any unspent air ambulance funding (the an operating budget to the Ministry each year, and
Ministry can recover unspent land ambulance fund- Ornge has submitted five-year operating budgets.
ing, but land ambulance funding amounts to less
than 10% of its total funding to Ornge). Further-
Ornge’s Transactions With Entities It
more, because the performance agreement applies
Controls or Of Which It Is a Beneficiary
only to Ornge and not to any other entity, it does not
entitle the Ministry to access the books and records Under the Auditor General Act, we were entitled to
of any of the entities that Ornge directly controls or unrestricted access to all of the entities Ornge con-
of the other for-profit business entities involved in solidates in its financial statements. However, the
many aspects of Ornge’s air ambulance operations. operations of the new for-profit international busi-
In essence, the Ministry has no right of access to the nesses, collectively referred to as Ornge Global, are
supporting records of the costs being incurred by not included in Ornge’s financial statements, and
these companies, which then bill Ornge for the oper- therefore Ornge Global did not allow us to access
ational and administrative services they provide. the records of these entities.
The Internal Audit review of Ornge transactions Our examination of selected transactions
to 2008 that the Ministry commissioned concluded that we were able to scrutinize found numerous
that the Ministry’s contract with Ornge should be examples where ministry oversight would have
revised to give the Ministry more comfort regarding been useful, including the following:
Ornge’s corporate structure and its impact on the • Millions of dollars were paid to one law firm
delivery of air ambulance services. We agree. between the 2008/09 and 2010/11 fiscal
years for various matters, including structur- request, to create new entities to pursue revenue
ing and procurement advice, financing issues opportunities outside Ontario. Ornge indicated
and numerous business agreements. that it had determined that it required third-party
• In 2010, Ornge’s top five senior executives investment to obtain non-ministry income. These
received a total of $2.5 million (this amount opportunities included providing medical services
was subsequently reported to be higher). We to travelling executives and consulting services to
were advised that, because most of Ornge’s foreign governments. It was expected that the new
senior executives were employed by an Ornge entities would seek investments from other coun-
for-profit subsidiary that year, there was tries, including the United States.
no requirement for their compensation to Ornge indicated that a share of the revenues
be disclosed under the Public Sector Salary generated by the proposed new entities (a group of
Disclosure Act or the performance agreement. companies collectively called Ornge Global), along
Despite this, however, we still feel the Min- with additional funding from the Ministry, would
istry should have had access to this informa- help Ornge service more patients. For example, this
tion (certain of this information was disclosed money would allow Ornge to hire more pilots and
after we completed our audit fieldwork). paramedics. A master licence agreement set out
• Ornge’s six board members were paid a total how much Ornge would receive from Ornge Global
of $643,000 in the 2010/11 fiscal year as a (3% of gross revenues from non-Ontario system
“retainer,” with one board member receiving activities) for use of Ornge’s intellectual property,
more than $200,000. This did not include such as operating manuals and the Ornge name.
reimbursement for any other expenses A consulting firm that Ornge hired to examine the
incurred by board members. agreement reported in January 2011 that, with
Ornge told us that ministry funding was not qualifications, the agreement was “fair and reason-
used for certain of these payments. Instead, other able” to Ornge. Ornge Global Management Inc.
means, such as Ornge Global borrowing money (one of the Ornge Global entities) had also pledged
from Ornge, were used. Ornge also informed us to make voluntary donations to Ornge. Under both
that the borrowed money had not been originally the licence agreement and the pledge, no payments
obtained from the Ministry. would be required to be made to Ornge for at least
We also noted that Ornge transferred $8.4 mil- three years, and the combined lifetime maximum
lion of ministry funding in 2008 to its charitable payable under both was $200 million. The pledge
foundation (we understand that this foundation was also subject to first satisfying financial obliga-
is being wound down). The foundation used the tions under Ornge Global Management Inc.’s share-
money to purchase items such as a mobile trailer holder’s agreement.
for training paramedics, computer hardware and The board committee was also to consider
patient simulators. These items were made available the “commercial reasonableness” of transferring
for Ornge’s use and subsequently for Ornge Global’s ownership of two Ornge subsidiaries to Ornge
use. Ornge advised us that it can have the equip- Global for $2. Ornge management indicated that
ment gifted back to itself should the need arise. it felt this was their fair-market value. The staff of
the two subsidiaries were also transferred, as well
as Ornge’s agreements with these two subsidiaries.
Ornge Global
The agreements included the companies providing
In October 2010, a committee of three non-manage- accounting, payroll processing, aviation, aircraft
ment Ornge board members began to assess a plan, maintenance and pilot management services “at
prepared by Ornge’s management at the board’s cost.” Another agreement moved Ornge’s CEO and
18 Special Report
two other senior executives to the new entity, which board received all these reports two months later,
would then sell back their services to Ornge, also in January 2011.
“at cost.” (Ornge continued to employ paramedic, Members of the committee, as well as the other
dispatch and medical staff.) board members and certain members of senior
The risk with such arrangements is that “at cost” management, became 99.999% owners of the new
could be more expensive than what Ornge might entity. Members of senior management owned
otherwise pay if, for example, the new entity pays about 94%. Members of the board committee
higher salaries, enters into complex arrangements informed us that they were not aware they were
requiring considerable administration and profes- going to be owners until after they had approved
sional fees or acquires more capacity than it needs. the decision to create the new entity. Our request
Further, as already noted, under the performance to see a listing of the initial owners was refused.
agreement, the Ministry would be unable to verify Ornge management indicated that they expected
that the amounts it pays directly or indirectly reflect their ownership share to decrease subsequent to
actual costs or that these costs are fair and reason- future investments by third parties.
able. Senior executives might, for example, work The decision to go ahead with the creation of
primarily on the international side of the business, Ornge Global ultimately resulted in the creation
and therefore it might be difficult for the Ministry of a complicated network of new companies that
to periodically verify how much time management Ornge indicated was warranted for various legal,
spent on the affairs of each organization. tax, accounting and other reasons. This corporate
In fall 2011, after we had completed our field- structure, existing independently of Ornge and its
work, Ornge indicated that three of the existing subsidiaries, is illustrated in Figure 5. In December
agreements between Ornge and various Ornge 2010, Ornge requested a meeting to brief the
Global entities would be amended to provide Ornge Ministry on the new business ventures, and subse-
with the right to audit the calculation of all “at cost” quently, in January 2011, met with the Ministry to
fees. However, unless the Ministry could select the provide an overview of its new ventures. The board
auditor and direct the scope and frequency of such chair also sent a very detailed letter to the Ministry
audits, we questioned whether this would provide and other senior government officials outlining
the Ministry with the assurance it needs. many of its corporate restructurings.
In addition, since Ornge’s agreements with the Ornge management told us that non-ministry
subsidiaries were also transferred to Ornge Global, sources were funding the new business venture. For
the committee did not review whether Ornge could example, Ornge management described for us an
buy services such as accounting, payroll processing, agreement that one of its subsidiaries transacted,
aviation, aircraft maintenance and pilot manage- effective August 2010, to provide marketing servi-
ment for less than what Ornge Global would charge. ces for a fee of $4.8 million (subsequently reported
In November 2010, on the basis of preliminary to be a higher amount) to the European company
feedback from its committee, the board authorized that sold the helicopters to Ornge. However, the
the creation of the Ornge Global structure. That agreement appeared to us to be the agreement
month, a new entity, Ornge Global Management envisioned in the original helicopter purchase
Inc., came into being, and companies affiliated to contract, signed in 2008, which said that Ornge
it began to be formed. The decision to further pro- and the helicopter supplier would “use their best
ceed with these arrangements was contingent on efforts to develop a joint marketing program for
the findings of several reports still to be received, the purpose of promoting each other’s products
including one from the board committee. The and services on a non-exclusive basis in mutually
agreed upon countries.” Ornge management, who
Figure 5: The Ornge and Ornge Global Corporate Structure at March 31, 2011
Ornge Global
Ornge Global GP Inc.
Ornge Management Inc. Orngeco
(general partner)
(limited partner)
Ornge Global
J Smarts
Real Estate Inc.
Ornge Global Holdings LP

Ornge Ornge Real (limited partnership)
Foundation Estate Inc.
Issuer Trustee Ornge Issuer

(outside company) Trust Ornge Global Ornge Ornge Global
Ornge Global
Corporate Solutions Inc.
Air Inc. U.S. Inc.
Services Inc.
accessible to ministry monitoring and oversight through

the performance agreement
Bare not accessible to ministry monitoring and oversight through
Trustee the performance agreement
A B A owns B and has decision-making control over B
A B A owns B but does not have decision-making control over B
A B A does not own B but has decision-making control over B
A B B is the beneficiary of A
also are senior management of Ornge Global, told this and other matters since April 2010. We were
us that this particular clause had been waived and advised that the preformation agreement was
that the marketing agreement with Ornge Global necessary for legal, tax and other business reasons.
was a totally unrelated transaction. However, it also had the effect of denying us access
Although the marketing agreement with the to all transactions that the agreement indicated
helicopter supplier was signed by an Ornge subsidi- Ornge had performed on Ornge Global’s behalf
ary, we were denied access to it because Ornge indi- since April 2010. Ornge advised us that because our
cated that the Ornge subsidiary had been working legislation allows us access only to organizations
on behalf of Ornge Global when transacting it. receiving direct or indirect government funding
In this regard, in December 2010, shortly and Ornge Global was not such an organization, we
after our audit fieldwork began, Ornge’s CEO were not entitled to access.
(representing an Ornge Global entity) and Ornge’s
Executive Vice President of Corporate Services
Debt Financing of Air Ambulance Services
(representing the Ornge subsidiary) signed a
preformation agreement stating that the Ornge The performance agreement does not require that
subsidiary was acting on Ornge Global’s behalf in Ornge obtain ministry approval to borrow money.
20 Special Report
In 2009, Ornge informed the Ministry and the companies to which the Ministry does not have
Ontario Financing Authority that it was planning access under the performance agreement. The
to borrow $275 million through a bond issue. It performance agreement states that Ornge “shall not
said it would use the money for “general corporate sell, lease or otherwise dispose of any assets, other
purposes” and capital purchases, such as space for than in the usual and ordinary course of business,
its corporate head office, as well as for aircraft as it purchased with Ministry Grant Funding without
moved from contracting with external providers to the Ministry’s prior written consent.” It further
deliver air ambulance services to delivering certain states that “all of the Assets which continue to be
of those services itself. in the possession of [Ornge] as well as the assets of
Ornge Issuer Trust issued the bond in June [Ornge] that were paid for with the Grant Funding
2009. The bond bears annual interest of 5.727% shall become the property of the Ministry upon
and will mature in June 2034. It requires payments the termination of the Agreement.” However, as
of only interest until June 2012 and then principal a result of arrangements whereby assets are held
as well as interest thereafter. The cost to arrange outside of Ornge, $210 million worth of assets
this financing was $2.5 million. Key to securing the being funded by the Ministry were not the property
financing was Ornge’s performance agreement with of Ornge as of December 31, 2010. At that time,
the Ministry, given that the Ministry was funding only about $5 million in assets being bought with
99% of Ornge’s operations. The credit rating Ornge ministry funding belonged directly to Ornge. Ornge
was assigned in June 2009 was primarily based indicated that its position is that the Ministry has
on factors that included the “strong support from no legal interest in any of Ornge’s assets because
the province, a high degree of integration with the they were purchased with funds borrowed from
provincial health system, [and] the essentiality of non-ministry sources. Ornge stated that, rather, it is
the services provided…” using ministry funding to pay third parties, such as
According to Ornge, about $16 million in inter- its consolidated entities, for the use of these assets.
est payments were paid in the first year of the bond, Given, among other things, that the purchase of
using $4 million of ministry funding and $12 mil- these assets was funded by a bond that is part of
lion of the bond funding itself. In the second year, the province’s reported liabilities, we believe the
Ornge was expected to use about $16 million in Ministry needs to satisfy itself that its interests are
ministry funding for bond interest payments. Begin- protected.
ning in the 2013/14 fiscal year, principal and inter-
est payments will total about $22 million a year.
Significant Purchases
Because Ornge has few sources of revenue other
than the Ministry, we expect that ministry funding The performance agreement makes Ornge respon-
will need to be used to make continuing interest sible for “the procurement necessary for the deliv-
and principal payments. ery of the Air Ambulance Services.”
Although Ornge required no approval from
the Ministry to borrow the money, Ornge has
Corporate-head-office Space
guaranteed that it will repay the debt. Further,
When Ornge assumed responsibility for air ambu-
the $275 million is part of the province’s liabilities
lance services, it initially received only the space the
for accounting purposes and appears in Ontario’s
Ministry had been leasing for the dispatch centre.
financial statements as part of the province’s
Ornge therefore leased 34,000 square feet at that
total debt. One concern we have is that under the
time to house its head office and consolidate other
new organizational structure, the assets acquired
functions such as dispatch and medical oversight. It
with the bond proceeds are mostly controlled by
subsequently determined that it needed more space lion using some of the money borrowed through
and that it needed to obtain cash for Ornge to invest the $275-million bond issue. In January 2011,
in Ornge Global. The series of events that followed Bare Trustee sold legal interest in the property to
these decisions is illustrated in Figure 6. Ornge Global Real Estate Inc. for $15 million and
As described in Figure 6, Bare Trustee, a sub- transferred beneficial ownership (that is, the right
sidiary of Ornge Issuer Trust, originally bought to benefit from the property) to Ornge. Ornge
the head-office property in July 2009 for $15 mil- Global Real Estate Inc. then leased the property
Figure 6: Chronology of Key Events Relating to Head-office Space

Pre 2009 Ornge leases 34,000 sq ft of space to house its operations and subsequently decides it needs more space.
June 2009 Ornge Issuer Trust, a financing vehicle used by Ornge, issues a $275-million bond.
July 2009 Part of the bond proceeds is used to buy 72,000 sq ft of head-office space for $15 million. Bare Trustee, a
subsidiary of Ornge Issuer Trust, owns the property and leases it to Ornge.
October 2010 A committee of the Ornge board begins to examine the reasonableness of a plan to create an international
for-profit business venture, to be called Ornge Global.
November 2010 Ornge board authorizes the creation of the Ornge Global organizational structure.
Ornge Global Management Inc. and Ornge Global GP Inc. are officially created.
December 2010 Ornge creates a subsidiary: Ornge Global Real Estate Inc.
Ornge Global Holdings LP is officially created.
Ornge issues a Declaration of Trust placing Ornge Global Real Estate Inc.’s single share of capital in trust
with the newly created Ornge Global Management Inc. and giving it authority to make all decisions for Ornge
Global Real Estate Inc.
January 2011 Ornge creates a subsidiary: Ornge Real Estate Inc.
Ornge’s board, after receiving reports from its committee, gives final approval to all organizational changes
and agreements involving Ornge Global, subject to informing the Ministry of the details of its decision. The
chair advises the Ministry in writing of its new business ventures and its new organizational structure.
$9 million is obtained to finance Ornge Global’s operations as follows:
• Bare Trustee sells the head-office property to Ornge Global Real Estate Inc. for the original July 2009
price of $15 million.
• Ornge Global Real Estate Inc. leases the property to Ornge Real Estate Inc. at above-market rent for 25
years. Ornge subleases the property from Ornge Real Estate Inc. on the same above-market-rent terms.
• Ornge guarantees rent payments to Ornge Global Real Estate Inc. through an indemnity agreement that
makes Ornge legally responsible for rent payments.
• Ornge Global Real Estate Inc. borrows $24 million by issuing mortgage bonds, financed by a third-party
financial-services company, based on the combined worth of the above-market-value lease and the
property value. This is $9 million more than the $15-million purchase price of the property.
• Ornge Real Estate Inc. and Ornge Global Real Estate Inc. issue debentures to guarantee payment of the
mortgage bonds.
• Ornge Global Real Estate Inc. pays $15 million to Ornge Issuer Trust to complete the transaction as
described above.1
• The remaining $9 million is to be loaned to Ornge Global for Ornge’s future purchase of ownership units
of Ornge Global Holdings LP.2
• The provincial debt increases by the $24 million borrowed by Ornge Global Real Estate Inc.
1. Ornge indicated that Ornge Issuer Trust used these funds for capital acquisitions and to reduce non-bond debt.
2. Ornge indicated that $5.6 million had been loaned at the time of Ornge Global Holdings LP’s bankruptcy in early 2012.
22 Special Report
to Ornge Real Estate Inc. for 25 years. Ornge sub- (ownership) interest in Ornge Global. Since the time
leased the property from Ornge Real Estate Inc. on of our audit, Ornge Global Holdings LP has been
the same terms and conditions. declared bankrupt. Ornge informed us that, at the
Under the lease, Ornge Real Estate pays Ornge time of its bankruptcy, Ornge Global Holdings LP
Global Real Estate Inc. a rent of $20 per square foot had been loaned $5.6 million of the $9 million.
a year in the first five years, $23 per square foot Ornge advised us that it bought the bigger space
annually in years six to 10 and further increases in 2009 because it anticipated significant growth
every five years thereafter. A fairness opinion com- in staffing and business activities over the next five
missioned by Ornge concluded with qualifications years. For example, it established a school to train
that the lease rates fall “within a reasonable range air paramedics and it planned to offer consulting
of prevailing market rates.” and other services as part of its private business
We obtained an independent appraisal based ventures. Subsequent to our fieldwork, Ornge
on a comparison of similar properties in the same informed us that its most recent analysis indicated
area. Our appraisal concluded that the annual fair- that 88% of the building would be used for Ontario-
market-value rate for the first five years of Ornge’s based activities by the 2013/14 fiscal year, with
lease should be about $14 per square foot, not $20. the other activities occupying and paying for the
The appraiser judged the annual market rate for the remaining space.
second five-year period of the lease to be $16 per
square foot rather than $23. The appraiser also
Aircraft
noted that most leases of this kind are for shorter
The performance agreement transferred the Min-
periods than 25 years and found that, if it were
istry’s contracts with 20 aircraft service providers to
vacant and not leased, the property would be worth
Ornge. Ornge used these and other service provid-
only about $9.4 million.
ers exclusively during the first two years of its exist-
One result of these transactions is that the Min-
ence. All of the service providers performed mainly
istry is funding what we believe are above-market
inter-facility transfers. Three of them provided a
rent payments for 25 years on the head-office
higher level of patient care when needed and could
property. Another is that the high lease rates being
perform pickups at accident scenes.
paid over a 25-year term substantially increased
In 2008, Ornge issued an open and competitive
the value of the building. Specifically, on the basis
request for proposals to aircraft service providers.
of the value of the building and the lease, Ornge
Based on the detailed submissions it received,
Global Real Estate Inc. secured a $24-million mort-
Ornge considered various air ambulance service-
gage bond through a third-party financial-services
delivery options. Ornge indicated that, in light of
company. It paid Ornge Issuer Trust the $15 mil-
factors such as its service providers’ aging aircraft
lion for the property with money from the bond.
and the cost of maintaining them, it concluded
According to Ornge, this $15 million was not used
that operating its own airline was the most cost-
to pay down any of the $275-million bond because
effective method of service delivery, as well as the
the penalties to do so would be onerous.
best method for ensuring patient safety and quality
At the time of our audit fieldwork, Ornge indi-
of patient care. This would entail purchasing new
cated that it planned to loan the remaining $9 mil-
aircraft, as well as some used aircraft while await-
lion to Ornge Global Holdings LP, whose sole limited
ing delivery of the new aircraft. Ornge also decided
partner is owned by certain members of Ornge’s
to continue to use the aircraft service providers
senior management and board. Furthermore,
primarily for patients requiring lower-level care.
Ornge stated that it planned to use the $9 million
for Ornge’s future purchase of limited partnership
Using funds borrowed through the $275-mil- Ornge’s own analysis indicated that six airplanes
lion bond, Ornge bought 12 helicopters (cost- and nine helicopters would be sufficient to serve
ing US$148 million) and 10 airplanes (costing the province’s needs. However, Ornge bought 10
US$42 million), for a total of about US$190 mil- new airplanes and 12 new helicopters, as well as
lion. Ornge management told us that the specific the 11 used helicopters to use while awaiting deliv-
features Ornge needed for the aircraft narrowed ery of the new aircraft. It also planned to continue
the field of possible suppliers. Therefore, instead to use aircraft service providers for some flights.
of issuing a public request for proposals, it sent In April 2011, we asked Ornge to outline how
requests for information to only three helicopter the new aircraft would be used given that Ornge
suppliers (only one of which offered all the main purchased more than its analysis indicated were
features Ornge wanted) and two airplane suppliers. actually needed. Ornge indicated that its plans for
It subsequently entered into contracts with the heli- the 10 airplanes were to operate five out of four air
copter supplier that offered all the main features bases—with five extras for back-up, maintenance,
(from Europe) and one of the airplane suppliers rotation and training. This was two more than the
(from the United States). Ornge advised us that the three back-up airplanes it had in the 2006/07 fiscal
new aircraft were faster and larger than those used year. Ornge did not have an analysis to demonstrate
by Ornge’s service providers, could travel farther the need for these additional back-ups.
without refuelling and had de-icing capabilities. Ornge’s plans for the 12 helicopters were to
In March 2009, 18 months before the scheduled operate nine out of six air bases. Ornge said that
delivery of the new helicopters, Ornge also pur- the three other helicopters that it had no immedi-
chased 11 used helicopters from one of its original ate need for were a reasonable purchase to ensure
service providers. It was to use these helicopters service availability in case any of the helicopters
while awaiting delivery of the new aircraft. It paid required more maintenance than anticipated. How-
about $28 million for the helicopters, which were ever, at the time of our audit, Ornge had requested
more than 20 and, in some cases, 30 years old. It the manufacturer to install seating for 12 people in
also paid about $2 million for four air bases and a two of the helicopters rather than having a medical
crew facility. Ornge entered into a three-year agree- interior installed, as was originally planned. The
ment with this service provider to fly and maintain seating for 12 would have to be removed if the heli-
the helicopters. Ornge indicated that it had com- copters were to be used to transport patients.
pared the cost of extending its agreement with the Ornge advised the Ministry that its excess heli-
service provider with that of purchasing the 11 copter capacity could be made available to Ornge
used helicopters and concluded that purchasing Global, depending on the needs of Ornge Global.
was the most cost-effective option. Ornge hired Subsequent to our audit fieldwork, Ornge indicated
a consulting firm to examine the fairness of the that one of the three helicopters that it had initially
agreement to acquire the air and base assets and determined it had no immediate use for would in
to have the helicopter company provide pilot and fact be located at one of its bases and used to trans-
maintenance services. The consulting firm’s report port patients. It was considering selling the other
concluded, with qualifications, that the agreement two.
was financially fair to Ornge. With the arrival of The European helicopter supplier subsequently
its new helicopters, Ornge was in the process of pledged US$2.9 million over three years to Ornge’s
disposing of the used helicopters at the time of our charitable foundation. The airplane supplier com-
fieldwork in early 2011. It expected to receive less mitted to about US$340,000 (2% of the purchase
than $8 million for them. price of the airplanes). The helicopter supplier
agreed to donate the funds “to provide improved
24 Special Report
patient care and facilitate the education and train-

Ornge has directly or indirectly entered into
ing of transport medicine professionals.” We noted
contracts, or develop an alternative mechan-
that the helicopter supplier paid US$500,000 of
ism to ensure that the public’s interest in
its $2.9-million contribution to have two custom-
Ontario’s air ambulance service is being
made motorcycles built and to use them to promote
protected;
Ornge. This included having them appear on
American Chopper, a television show featuring a • determine whether the amount it pays Ornge
is reasonable by, for example, obtaining
California company called Orange County Choppers
and evaluating information on the cost and
that makes custom motorcycles. One of the motor-
delivery of air ambulance and related servi-
cycles was used afterwards in a promotional event
ces compared to previous years and to costs
at a Blue Jays game and at the time of our audit
incurred by other operators in Ontario and
was sitting in the lobby of Ornge’s office building.
other jurisdictions; and
Ornge recently informed us that the second motor-
cycle may be with Orange County Choppers in the • establish, in consultation with Ornge,
additional measurable performance indica-
United States.
tors for air and land ambulance services,
Ornge indicated that it obtained input from,
and obtain more frequent and informative
among others, paramedics and physicians when it
reports on the extent to which these per-
designed the aircraft interiors. Despite this, Ornge
formance expectations are being met.
paramedics still reported deficiencies with the
interiors of the new helicopters. For example, there
MINISTRY RESPONSE
is not enough room to perform cardio-pulmonary
resuscitation (CPR) without first rotating and The Ministry has informed Ornge that the
manually lowering the patient’s stretcher from the performance agreement will be amended. The
take-off and landing position. In addition, there amended agreement will put a greater emphasis
is insufficient space to allow patients’ heads to on performance standards and reporting to
remain elevated for the entire flight. Some patients increase Ornge’s transparency and accountabil-
require elevation at more than 45 degrees to avoid ity above that normally required of a transfer-
breathing problems, and Ornge has determined payment recipient. The amended agreement
that such patients would require a breathing tube will incorporate:
(that is, intubation) in order to be transported by • increased emphasis on performance stan-
helicopter. Ornge estimated that these issues affect dards for operational and financial costs;
less than 200 patients annually and indicated • increased reporting and disclosure obli-
that it has been working with the supplier to fully gations, including those for dispatch
address these issues. information;
• increased audit and inspection powers for
RECOMMENDATION 1 the Ministry;
To ensure that the amount paid for air ambu- • requirements for Ornge to put a patient
advocate-and-complaints process in place;
lance and related services is reasonable for the
level of service provided, the Ministry of Health • more detailed financial planning, monitor-
ing, control and reporting obligations;
and Long-Term Care should:
• consider renegotiating Ornge’s perform- • required compliance with legislation such as
the Public Sector Salary Disclosure Act, 1996
ance agreement to provide it with direct
and the Broader Public Sector Accountability
access to affiliated organizations with which
Act, 2010;
and 10 designated delivery agents in remote areas.

• required ministerial approval of any debt The Ministry still had overall responsibility for the
increases;
program and control over most dispatching. Our
• required ministry approval before Ornge can
2000 audit of land ambulance services expressed
change its corporate structure or form affilia-
concern that municipalities would not want their
tions with for-profit entities;
ambulances operating outside their borders even
• required ministry approval for any sale or
if their ambulance was the closest to the patient
encumbrance of assets;
needing pickup. This could result in inter-facility
• the granting of authority to the Ministry to
transfers being handled by ambulances that are not
approve annual budgets and make in-year
the closest ones, which ultimately could prove more
and year-end funding recoveries;
costly.
• reduced funding for non-performance;
In 2004, the medical director of a small organ-
• a requirement that assets purchased with
ization that was providing medical oversight to
ministry funding be owned by Ornge and be
Ontario’s air ambulance service proposed to the
transferred to the Ministry on the termina-
Ministry the creation of a land ambulance system to
tion of the agreement;
transfer patients between health-care facilities. The
• strengthened conflict-of-interest provisions;
medical director, who later became CEO of Ornge,
• quality-improvement provisions based on
proposed transferring about 26,000 acute-care
the Excellent Care for All Act, 2010, including
patients each year, at a cost of about $15 million
linking executive compensation to perform-
annually. At the time, the Ministry conducted no
ance improvement targets in the annual
analyses to determine the actual number of patients
quality plan;
requiring land ambulance transfers between health-
• public reporting of specified information;
care facilities each year. Ornge’s 2005 formal
• protection for whistleblowers; and
business plan indicated that the organization will
• a reduced notice period for the Ministry to
“directly provide service for up to 30,000 acute care
terminate the agreement.
land transfers annually.” Ornge indicated at the
The Ministry will also conduct an assessment
time of our audit that this did not include patients
of historical and interjurisdictional costs in the
served by Toronto Emergency Medical Services
2012/13 fiscal year to add to its knowledge base,
(TEMS). Ornge also indicated that the number
using the costs as ongoing comparators.
of patient transfers was an estimate because no
reliable data were available on the actual number
of patient inter-facility transfers. In 2005, the
LAND AMBULANCE SERVICES proposed cost of doing this was $15 million for the
2005/06 fiscal year and $22 million per year there-
Ornge’s Commencement of Critical-care
after until 2009/10.
Land Ambulance Services
In January 2006, an Inter-Facility Transfer
Prior to 2000, the Ministry’s Emergency Health Working Group, consisting of executives from
Services Branch provided land ambulance services, the Association of Municipalities of Ontario and
with vehicles deployed across the province primar- chaired by the CEO of Ornge, indicated that muni-
ily through ministry dispatch centres. The service cipalities preferred to devote their ambulances to
gave priority to on-scene emergency calls but also emergency calls rather than inter-facility transfers.
performed inter-facility transfers. As a result, the Working Group recommended a
In 2000, responsibility for land ambulances was new system to exempt municipalities from hav-
transferred to Ontario’s 40 upper-tier municipalities ing to perform inter-facility transfers of critically
26 Special Report
ill patients. It recommended that such transfers funding to provide services using eight ambulances
instead be handled by a new service staffed with out of three bases—Ottawa, Peterborough and the
paramedics trained in critical care. GTA—instead of out of the nine bases specified in
In October 2006, prior to approving the new the amended performance agreement. However,
critical-care land ambulance transfer program, the Ornge had already purchased 18 land ambulances,
Ministry provided Ornge with $9.4 million for the as discussed further in the following section, when
purchase of vehicles and other start-up costs. At the this decision was made. Beginning in the 2009/10
time, the Ministry indicated that if the Ambulance fiscal year, the Ministry reduced funding for critical-
Act (Act) was amended to enable Ornge to provide care land ambulance transfers to $13 million due to
land ambulance services, Ornge would receive up “budget constraints.” Funding for the 2010/11 fiscal
to $15 million annually, starting in the 2007/08 year was about 5% more than this amount.
fiscal year, to provide the service. The Ministry said
that it did not use a competitive acquisition process
Deployment of Land Ambulances
to choose the service provider because it wanted
to centralize the medical oversight for inter-facility Ornge purchased 18 land ambulances for about
critical-care transfers under Ornge. Ministry docu- $2.1 million between August 2006 and January
ments show the $15 million was expected to fund 2007, and a municipality gave it a nineteenth
nine ambulances, which would operate out of eight ambulance, before it was decided to operate just
land ambulance bases and transport about 20,000 eight ambulances out of three land bases to transfer
patients a year. critically ill patients. This left Ornge with 11 extra
Later in 2007, the Ministry did amend the Act to vehicles. In the 2007/08 fiscal year, as required
allow Ornge to provide land ambulance services. under the performance agreement, Ornge funded
The following year, the Ministry contracted with TEMS to provide critical-care land ambulance servi-
Ornge, through an amendment in the performance ces primarily in the Greater Toronto Area. In 2010,
agreement, to transfer critically ill patients by land Ornge provided TEMS with two of the vehicles that
ambulance between health-care facilities. The it had not been using.
amendment provided Ornge with $13 million in the Ornge designated another four of the extra
2007/08 fiscal year and $19 million a year there- land ambulances for operational support, such as
after for this service. The annual amount included training paramedics and transporting paramedics
$2.9 million to be flowed to TEMS for transporting and equipment. It positioned the last five extra land
critically ill patients primarily between Toronto ambulances at four of its air bases for use when bad
health-care facilities (previously, the Ministry weather halted air traffic or when a patient’s condi-
funded TEMS directly for this). Ornge indicated tion allowed for land transfer. This has resulted in
that beginning in the 2010/11 fiscal year, funding more ambulances than paramedics being available
to TEMS had been reduced to $2.2 million. at certain bases to respond to calls. For example,
This amendment contained no specific level-of- the Toronto base has three helicopters (two active
service expectations or performance reporting to and one back-up) and two land vehicles—but only
enable the Ministry to monitor actual inter-facility enough paramedics to staff a maximum of two of
transports and compare them to the estimated these five vehicles at any one time.
number being funded. It did, however, state that
Ornge was to provide services out of nine bases in
Cost and Use of Land Ambulances
certain specified municipalities across the province.
In 2008, Ornge determined in conjunction with Ornge uses its land ambulances for inter-facility
the Ministry that there was only enough ministry transports of patients who its transport-medicine
physician has determined can travel safely by cost for transporting almost 1,500 patients by land
land. Many of these patients do not require an ambulance was $7,700 per patient. This is only
accompanying critical-care paramedic. In fact, in 7% less than the cost of transporting a patient by
the 2009/10 fiscal year, the most recent for which air. We would have expected land transfers to cost
Ornge performed an analysis, only 900 of the significantly less than air transfers. We also noted
almost 2,500 Ornge-funded land ambulance trans- that under Ornge’s contract with TEMS, TEMS’s
fers were for critically ill patients where a critical- 2010/11 per-patient transport cost was $1,700, or
care paramedic was provided, and TEMS handled $6,000 less per patient. We expect TEMS’s cost to
an estimated 60% of them. be less than Ornge’s due to the number and proxim-
Even though the land ambulance transports ity of patients and hospitals in Toronto, and we
that Ornge dispatched increased by 50% between recognize that Ornge also incurs dispatch costs. But
the 2008/09 and 2010/11 fiscal years, the total with actual transport volumes so much lower than
number for 2010/11 was still only 2,827, or just anticipated, these services still appear quite costly
14% of the 20,000 annual transfers anticipated in on a per-patient basis. The Ministry needs a fuller
2006. Ornge indicated that the number of patients understanding of the demand for services and the
to be transported was not within its control costs of the options for meeting that demand to bet-
because hospitals generally had to request the ter establish funding requirements.
transfers. Although the Ministry had reduced its
funding by about 30%, to $13 million, actual trans- RECOMMENDATION 2
ports were 86% fewer than the estimated number
Given that Ornge has been transporting critic-
of transports originally funded.
ally ill patients between health-care facilities for
The Ministry has the power to recover land
more than three years, the Ministry of Health
ambulance funding that Ornge does not use. In
and Long-Term Care should conduct a formal
2008/09, the first full fiscal year that Ornge pro-
program evaluation, including:
vided land ambulance services, Ornge spent $8 mil-
lion less than it got from the Ministry because of a • assessing the current total demand for
critical-care land ambulance transports in
slow start in implementing the program. The Min-
Ontario and whether the program is meeting
istry approved Ornge’s request to keep $5 million
the needs of the facilities that patients are
of this surplus primarily to pay for rate increases
being transferred between;
of contracted air ambulance service providers.
Ornge later asked if it might instead spend the • since the number of transfers has been
significantly less than expected, determin-
surplus primarily on paramedic training relating
ing the optimal number of land ambulances
to new aircraft. The Ministry agreed and received
Ornge requires;
a report from Ornge that indicated that the funds
were primarily spent on costs relating to new Ornge • determining the capacity for municipal land
ambulances—including those of Toronto
aircraft. In the 2009/10 fiscal year, Ornge reported
Emergency Medical Services, which cur-
a $16,000 surplus and has not reported any more
rently responds to most calls—to transport
surpluses since then.
these patients instead of Ornge doing so; and
In the 2010/11 fiscal year, Ornge’s average
cost to transfer a patient by any means was about • comparing the costs of different service
options to help determine whether patients
$7,800. The cost to transfer a patient by aircraft is
can be safely transported more cost effect-
about $8,300. Using the funding and transfers data,
ively than under the current model.
we calculated that, excluding funding to TEMS and
patients transported by TEMS, Ornge’s 2010/11
28 Special Report
receives transport requests through PTAC, collects

MINISTRY RESPONSE
medical and personal information about patients,
In 2012/13, the Ministry will undertake a helps plan transports, and helps prioritize patients
program evaluation to assess the operational and determine the required level of care.
demand, financial requirements and delivery
model for these services.
Selection of Ambulances and Flight
Planning
When it accepts an emergency call, Ornge’s policy is
DISPATCH OF AMBULANCES
generally to dispatch the air or land ambulance that
The Ambulance Act requires that the Ministry would most quickly complete the call. Urgent calls,
ensure the existence throughout Ontario of a while less pressing than emergency requests, also
“balanced and integrated” system of ambulance require a speedy response. In the 2009/10 fiscal
services. This includes communication systems for year, about 42% of calls were considered emergen-
the dispatch of ambulances. cies and required an ambulance as soon as possible;
The Ornge Communications Centre (Centre) 20% were urgent and required an ambulance soon.
receives calls primarily for inter-facility transfers, For the remaining 38% of calls, Ornge scheduled
which are handled directly by Ornge, by one of transports using the option that met patient needs
the air ambulance service providers or by TEMS. at the lowest cost. If a patient requires a critical-
The Centre also receives calls for other types of care paramedic, an Ornge paramedic generally
transports, including emergency airlifts at accident must be used because the current air ambulance
scenes. These are generally assigned to Ornge’s service providers do not have paramedics trained
helicopter service provider, which uses Ornge at the critical-care level. Because Optimas does
paramedics. not estimate the cost per flight, the Centre uses
Information about patients requiring inter-facil- Aerosoft, a program inherited from the Ministry,
ity transport is usually collected initially through to show the various options and costs for air ambu-
the Provincial Transfer Authorization Centre lance dispatch. Aerosoft works only on a flight-by-
(PTAC), managed by Ornge. This is a safeguard to flight basis, however, and provides no information
help reduce the risk of infectious disease transmis- on how to most efficiently plan all scheduled flights
sion. A patient must receive a PTAC number before in a given day.
he or she can be authorized for transfer. There is no Ornge conducts no regular reviews of decisions
such requirement for the pickup of patients not in to determine if the most appropriate aircraft was
hospital, such as those at the scene of an accident. chosen. At the time of our audit fieldwork, Ornge
The Ornge Communications Centre usually did not retain records of available options for any
approves the dispatch of an air ambulance if given air ambulance transport, so we could not
certain criteria are met, examples of which are determine whether the most appropriate options
included in Figure 2. were consistently selected. Ornge indicated that
In 2006, Ornge inherited the 10-year-old air it subsequently introduced a manual process to
ambulance dispatch system that the Ministry had record this information and is planning to record it
developed in-house and which had a number of electronically in the future.
limitations. Consequently, the following year it Concerns about Aerosoft’s ability to choose the
replaced the system with the Ornge Provincial lowest-cost alternatives led Ornge to develop a
Transport Information and Medical Algorithmic new flight-planning program. The new program
System (Optimas), a web-based application that was designed to help plan non-emergency and
non-urgent transfers a day ahead of actual transport which poses the same risk of patient transport
to minimize the number of times that aircraft fly decisions being made with incomplete or inaccur-
empty. ate information as when the Ministry ran the
Ornge policies also stipulate the type of system directly.
ambulance—air or land—that should be used for
different distances. Air ambulances must be used
Level-of-care Determination and
when the transport is more than 240 km, but they
Paramedic Staffing of Ambulances
are generally used when the transport is more
than 140 km. However, because Optimas contains The performance agreement allows Ornge to make
no information on distance travelled for each leg decisions on service levels, such as the number
of a trip (usually, the first leg is from base to the of paramedics required on each flight and the
hospital to pick up the patient, the second is from combination of paramedics needed to provide a
hospital to hospital, and the third is back to base), certain level of patient care. Ornge has determined,
Ornge cannot evaluate overall staff compliance for example, that an advanced-care paramedic and
with its policies. It has no way to determine, for a critical-care paramedic working together can
example, whether air ambulances are being used handle critical-care calls, and that such calls do not
more frequently than necessary for distances less have to be handled by two critical-care paramedics.
than 140 km, or how frequently land ambulances In contrast, we noted that the contracts with service
are being used for distances greater than 140 km. providers that Ornge inherited from the Ministry in
2006 stipulated that critical care must be provided
by two critical-care paramedics.
Co-ordination with Hospitals and
A key determination that must be made prior to
Municipal Land Ambulances
dispatch is whether the paramedics are sufficiently
In our 2005 audit of air ambulance services, we trained to meet patient needs. While all emergency
noted that the Ministry had planned for several or urgent patients need care as quickly as possible,
years to create an electronic link between the air they do not necessarily require a high level of
and land ambulance dispatch systems to accelerate care during transport. Ornge indicated that many
the dispatch process and reduce the risk of patient emergency calls, for example, can be handled by
transport decisions being made with incomplete primary-care paramedics. On the other hand, indi-
or inaccurate information. A fully integrated emer- viduals being transferred from the intensive-care
gency ambulance services system would have given unit of one hospital to another frequently require
dispatchers single-point access to flight and medical higher levels of care during transport. Ornge’s
information, enabling them to communicate more critical-care paramedic training programs were
efficiently with land ambulance dispatch centres. developed for such patients.
Ornge flights, more than 90% of which are Optimas’s calculation of the level of care
inter-facility transfers, often involve communica- required for each patient depends on staff at the
tion with a hospital. However, many inter-facility Centre entering the appropriate information into
calls also involve communication with Ministry- or Optimas (for example, patient diagnosis, drugs
municipally-run dispatch centres, such as when required during transport and equipment needed
transporting a patient to or from an airport using a to support the patient). If necessary, Ornge’s trans-
non-Ornge land ambulance. As well, on-scene calls port-medicine physician can override Optimas’s
are always received through a land ambulance determination of the level of care. Optimas data
dispatch centre. However, all contact between the shows that in the 2009/10 fiscal year, the physician
dispatch centres and Ornge is by fax or telephone, made about 2,600 level-of-care changes out of
30 Special Report
about 18,000 transports by ambulances dispatched ambulances, but that these escorts were generally
by Ornge. away from hospital less than five hours. Ornge does
In May 2011, Ornge reviewed a week’s worth not maintain information that would enable it to
of Optimas data to determine the extent to which determine the extent to which a lack of available
the more than 40 staff at the Centre completed paramedics resulted in such escorts being needed.
the more significant data fields that Optimas uses
to calculate the level of care required. The review
Cancelled after Launch
concluded that the data was frequently entered in
inappropriate fields. Specifically, about 70% of staff In our 2005 audit of air ambulances, we noted that
entered data in the required fields 40% or less of the rate of air ambulance cancellations after takeoff
the time, with most entering data in the required had increased to 33% in the 2004/05 fiscal year.
fields less than 20% of the time. Therefore, Optimas Aircraft that have taken off are not available to take
often could not reliably calculate the required level other calls, which increases wait times for patients.
of care, which may help explain the need for over- We recommended that the Ministry review the high
rides by the transport-medicine physician. rate of cancellations.
Current ministry policy requires two paramedics Optimas contains data on flights cancelled
in every ambulance, whether land or air. Ornge’s after takeoff, but this information can generally be
policy allows only one paramedic for patients accessed only on a case-by-case basis. Ornge had
requiring primary care, and Ornge indicated this not tracked the total number of such cancellations.
had been approved by the Ministry. However, the Based on our review of a sample of cancelled calls
policy says that if only one Ornge paramedic is in the 2009/10 fiscal year, we found that about 30%
available for an advanced- or critical-care inter- were cancelled after takeoff. After our fieldwork,
facility transfer and the hospital decides not to wait Ornge indicated that it had implemented new pro-
for another Ornge paramedic to become available, cesses that were identifying these situations more
the hospital must send an escort to ensure proper consistently and that it would be taking action to
patient care during the transfer. As well, when try and reduce these instances.
patients are transported from one hospital to
another for stays of 12 hours or so—for example,
Not-serviced Calls
for tests involving specialized equipment—the
receiving hospital may require that the originating Ornge defines “not-serviced” calls as those in which
hospital send an escort to take responsibility for a request to transport a patient is received, but a
the patient at the receiving hospital. Ornge does patient is not ultimately transported for a variety of
not regularly track the number of times an escort is reasons, including:
sent or the reason why. According to a report Ornge • the request for an air ambulance does not
produced at our request, more than 3,600 flights meet Ornge’s transport criteria (see Figure 2);
had a medical escort in the 2009/10 fiscal year. • Ornge cannot respond safely to the call;
Furthermore, about 25% of all patients transported • Ornge is unable to transport a patient within
by airplane (rather than by helicopter) required a the requested time; or
medical escort from the originating hospital. • the call is cancelled either by the requester (for
In a survey primarily of medical professionals, example, because the wait would be too long)
conducted between December 2008 and Janu- or by Ornge (for example, because the aircraft
ary 2009 and commissioned by Ornge, 25% of was needed for a higher-priority patient).
respondents reported medical escorts were often or Ornge indicated that it did not provide service
always needed to accompany the patient on Ornge for about 7,700 requests in the 2009/10 fiscal
year—4,700 emergency on-scene requests and not provided due to factors under Ornge’s control.
another 3,000 inter-facility calls, of which about In another 30% of cases, there was not sufficient
1,900 were emergency or urgent requests. information to determine whether or not the
When a request for service is not met, dispatch contributing factors were under Ornge’s control. If
staff must either indicate that the call was cancelled Ornge had more complete data, it would be able to
or select from a list of other “not-serviced” reasons analyze whether improvements in service delivery
in Optimas. However, staff are not given guidance might be possible—for example, in cases where the
on choosing the most appropriate reason. Ornge ambulances cannot be provided because of insuffi-
produces a monthly summary report on cancelled cient staffing levels at particular bases.
calls and other not-serviced calls but does not In 2009, Ornge commissioned a consulting firm
report this information to the Ministry. to conduct a “gaps in service” review using Ornge
With respect to on-scene calls, Ornge received data on emergency and urgent patient transports
about 6,200 requests to pick up accident victims in in the 2008/09 fiscal year, as well as data from
the 2009/10 fiscal year. Of these, about 500 were sources such as the Canadian Institute for Health
actually picked up at the scene, and another 1,000 Information (a government-funded, independent,
were picked up from an airport or hospital where not-for-profit organization). The firm was directed
they had been transported by land ambulance. Of to use Ornge’s definition of what constitutes a ser-
the remaining 4,700 calls, about 70% were initially vice gap. The consultant’s report, finalized in 2010,
accepted by Ornge but later cancelled, usually by indicated that there was indeed a service gap but
the land ambulance dispatch that had requested that 83% of this estimated gap came from including
the air ambulance. For example, a call would be patient pickups that took place more than one hour
cancelled if a land ambulance reached the patient after all patient details had been obtained. The
first and the air ambulance was no longer required. consultant noted, and we agree, that this “one-hour
Although Ornge had some information on why target is not sensitive to geography (i.e., one hour
calls were cancelled, it did not track or analyze may be an unrealistic target time [for patients] in
this information. Ornge indicated that obtaining more remote centres)…” Furthermore, the consult-
more information on why these calls had been ant recommended that Ornge review the appropri-
cancelled could compromise patient care by taking ateness of the one-hour time target for identifying
paramedic time away from patients. The other 30% the service gap.
of calls—about 1,400—were declined by Ornge, Ornge has indicated that it considers it primarily
including almost 900 requests declined due to the the Ministry’s responsibility to provide funding to
weather, about 250 where paramedics or aircraft reduce the service gap. However, the Ministry does
were unavailable, and about 50 that did not meet not routinely receive information from Ornge on
Ornge’s criteria. not-serviced calls. Subsequent to our audit field-
Some 3,000 inter-facility calls were not serviced work, Ornge indicated that it had met with the Min-
out of almost 20,000 requests, with 65% of them istry to discuss the review of gaps in service but had
cancelled by the requester, but Ornge had little not provided the Ministry with a copy of the report.
information about these. Of the remaining 35%, Furthermore, Ornge does not report publicly on
Ornge data indicated that about 330 were declined the reasons for not-serviced calls. With respect to
due to the weather, about 125 because paramedics the consultant’s reported service gap, as previously
or aircraft were unavailable, and about 140 because noted, Ornge advised us that one of its main rea-
they did not meet Ornge’s criteria. sons for creating the Ornge Global entities was to
We reviewed a sample of not-serviced requests generate more revenue that, along with additional
and noted that in about 20% of them, transport was ministry funding, would help service more patients.
32 Special Report
New Dispatch System

To assist it in adequately overseeing Ornge’s
Deficiencies in Optimas led Ornge to purchase a ambulance operations, the Ministry should
new dispatch system in October 2008. At the time, require that Ornge periodically report the num-
Ornge planned a phased implementation of this ber of cancelled and declined calls, categorized
system, with components, such as one for crew by the main reasons.
scheduling, being rolled out starting in 2010. In
March 2011, Ornge implemented a component that ORNGE RESPONSE
assists in selecting the most appropriate aircraft.
Ornge agrees with this recommendation and
Ornge planned to modify the system’s medical com-
will work collaboratively with the Ministry to
ponent, which helps determine the required level
implement it, with the overall goal of improving
of patient care and urgency of transfer, and deploy
access and patient care.
it by October 2011. However, as of May 2011, it
had not yet begun these modifications and had no
MINISTRY RESPONSE
estimates about their cost. Ornge noted that, like
Optimas, its new air dispatch system will not be The Ministry will work with Ornge to assess the
electronically integrated with the dispatch systems cost/benefit analysis of an electronic link to the
for municipal land ambulances. land ambulance dispatch centres.
With respect to tracking the availability of
RECOMMENDATION 3 paramedics, the amended performance agree-
ment will include the reporting of hospital
To help ensure that air ambulance and related
medical escorts who are required to accompany
services meets patients’ needs cost-effectively,
patients being transferred. The amended per-
Ornge should:
formance agreement will also include increased
• ensure that its new dispatch system reliably
reporting of dispatch information that includes
tracks flight distances and cost data so that
cancelled and declined calls.
the most appropriate aircraft can be effi-
ciently routed to pick up and deliver patients
requiring transport;
• work with the Ministry of Health and Long- RESPONSE TIMES
Term Care (Ministry) to electronically link
In our 2005 Annual Report, we raised several
its dispatch system to the land ambulance
issues regarding response times, including a lack
dispatch systems run by the Ministry and
of monitoring of how long it took to dispatch air
municipalities;
ambulances and service providers failing to meet
• track and analyze how often hospital staff
contracted response-time standards. In 2006, the
must accompany a patient because appro-
Standing Committee on Public Accounts held a
priately trained Ornge paramedics are not
hearing on the audit and tabled a report in the
available, and determine if there are any
Legislature that recommended the Ministry provide
systemic issues, such as not enough para-
a written response by June 2008 regarding its mon-
medics being available at a particular base,
itoring of Ornge’s overall performance level, includ-
that need to be addressed; and
ing information on response times and cancelled
• review the reasons why a significant number
calls. At the time of our current audit, the Ministry
of flights are cancelled after takeoff and take
had not yet responded to the Committee’s request.
action to reduce such occurrences.
The performance agreement states that for on- in the correct Optimas data fields. We noted many
scene accident-type calls, “the Caller will be advised instances where this was not done or where this
within 10 minutes of receipt of each Call on the information was recorded in text fields, making it
status of (Ornge’s) ability to dispatch an aircraft.” difficult to track actual response times.
For emergency or urgent inter-facility air transfers, At the time of our audit, Ornge indicated that
callers are required to be advised within 20 min- it expected its new dispatch system to track the
utes. Although the agreement contains no other key times necessary for monitoring and reporting
specific air or land response-time requirements—for response times.
example, the time from when a call is received to In some cases, a health-care facility requests
when an aircraft takes off—we noted that Ornge’s an air ambulance at the same time it applies for a
contracts with its standing agreement operators number from the Provincial Transfer Authorization
require them to request air-traffic-control clearance Centre (PTAC) (as explained earlier, PTAC collects
within 60 minutes of the time a pilot accepts a call. important hospital-patient information that helps
reduce the risk of infectious disease transmission,
and a patient needs a PTAC number for transfer to
Call-receipt Process
be authorized). If it does, PTAC records the request,
When it receives a request for an ambulance, the and then Centre staff enter the call in Optimas. Our
Ornge Communications Centre (Centre) obtains review of Ornge call data in the 2009/10 fiscal year
details, such as the condition of the patient and found that it often took more than 15 minutes—
his or her location. Staff then determine if the and sometimes considerably longer—for staff to
request meets Ornge’s transport criteria. If it does, enter the call in Optimas from the time when PTAC
staff members discuss details with the requester, recorded the request.
review the availability of ambulances, paramedics
and pilots, and then determine whether Ornge will
Reporting Response Times
accept the transport request or decline it.
Ornge’s dispatch system, unlike the Ministry’s From the patient’s perspective, what is most relevant
old one, does not automatically create a date-and- for emergency and urgent calls is the time that
time record of a call as soon as it comes in. Rather, elapses from when the call is received by Ornge to
staff must open a record in the Optimas system the time the ambulance arrives. There are many fac-
after the call comes in, and when they do so the call tors to consider and decisions to make between these
is considered to have been received. Calls to the two times, not all of which are controlled by Ornge.
Centre are recorded for quality assurance purposes,
but this information is not linked to Optimas. As
Call Receipt to Acceptance
well, the new system, like the old one, does not
The performance agreement requires certain
automatically record the times of actions further on
response times to be measured from the time a call
in the process, such as when the Centre officially
is received to the time that Ornge’s “ability to dis-
accepts or declines a transport, when an aircraft
patch” an aircraft is determined. Ornge indicated
takes off or when a patient is picked up.
that these response times were further defined in
Without this information, it is difficult to deter-
consultation with the Ministry. The Ministry and
mine how quickly Ornge responds to emergency
Ornge agreed to two different starting points for
calls or whether scheduled patient transfers are
response-time measurement: on-scene calls were
completed on time. Ornge policy states that the
to be measured from the time the call was received,
Centre should complete the call record by docu-
while inter-facility calls were to be measured from
menting the date and time these events took place
34 Special Report
the later starting point of when Ornge had received and available Ornge data for emergency and urgent
all relevant patient details. However, Ornge actually air ambulance calls for the 2009/10 fiscal year, we
uses the later starting point to measure response found that only about 40% of the emergency and
time for all calls. The end-time was defined as the urgent inter-facility calls were accepted or declined
time Ornge discusses with the caller when the call within the 20-minute standard set out in the per-
could be completed (which occurs prior to the deci- formance agreement, and 50% took longer than 30
sion on whether to accept or decline the request). minutes. Ninety percent of calls were accepted or
Figure 7 illustrates the response time Ornge declined within four hours of receipt. Our analysis
measures. indicated that Ornge was successful in responding
Ornge reported having data available to measure more rapidly to on-scene calls, with 84% of the calls
89% of the inter-facility and 94% of the on-scene accepted or declined within the 10-minute target,
calls for the 2009/10 fiscal year. Measuring the time and about 50% accepted within five minutes.
from when all patient details were obtained to when
Ornge discussed when the call could be completed,
Acceptance to Departure
Ornge found it met the performance-agreement
Ornge policy states that, as long as pilots and para-
response times of 10 minutes and 20 minutes 97%
medics are available at the base, air ambulances
and 99% of the time, respectively.
must depart within 10 minutes (20 minutes, if
Given that more than 60% of the on-scene and
fueling is required) of the pilot accepting a call.
inter-facility calls that Ornge receives are emergen-
The policy stipulates that the time from acceptance
cies or otherwise urgent, we believe that Ornge
to departure is measured “from the time the pilot
should also track the time from when these calls are
in command accepts the call until the flight crew
initially received or the PTAC authorization time,
requests clearance from air traffic control.” Despite
if applicable, so that it can monitor the time from
Ornge’s policy, neither the time of pilot acceptance
initial call receipt to input of all patient details.
(usually just prior to when Ornge formally accepts
Furthermore, we believe that the length of time
the call) nor the crew’s request for clearance (usu-
from when a call is initially received to when the
ally after the paramedics are onboard the aircraft)
decision is made to accept or decline the request is
were tracked in Optimas. Consequently, Ornge can-
very important to a patient who is waiting for an
not determine if it is complying with this policy.
air ambulance to be sent. Using this time interval
Figure 7: Selected Key Steps in Response Process and Response Time Measured by Ornge
Prepared by the Office of the Auditor General of Ontario
Complete Potential
patient details timing discussed
received with caller
Ambulance
Call comes in Call accepted Ambulance
reaches
or declined departs
patient
Response
time measured
by Ornge
We reviewed a sample of requests for Ornge from the call-receipt starting point to when an air-
air ambulances that were made when paramedics craft is en route to pick up a patient, as well as how
were at the base. We noted the times that calls were long it takes to actually reach the patient.
accepted by Ornge and when flights left the base, Almost half of the medical professionals partici-
because these were the closest available times in pating in the previously noted survey said Ornge
Optimas. Where data was available, we found that rarely or never provided ambulance service in a
flights did not depart within 10 minutes of call “reasonable time.” We also noted in our 2010 audit
acceptance in 60% of the emergency and urgent on organ and tissue donation and transplantation
cases sampled. We noted that Ornge staff could that the Trillium Gift of Life Network observed many
enter a number of reasons for a delay in Optimas, delays in shipment of organs, often because air
but Ornge had not analyzed this information. transport was not available at the prearranged time.
For its own airplanes, Ornge produces an “effi-
ciency report,” which its policy states must include RECOMMENDATION 4
delays of more than 10 minutes. This report may
To enable air ambulance response times to be
include an estimate of the length of the delay and
assessed against performance standards and for
whether the delay was assessed as caused by factors
reasonableness:
under Ornge’s control or not. These reports cannot
readily be used to assess overall timeliness of air- • Ornge should ensure that all key times in
the call-handling process—such as the time
planes in departing because the extent of the delay
the call request is received, the time the call
is not always clear and the data is not summarized
was accepted or declined, and the time the
either monthly or annually.
ambulance was airborne—are recorded and
Ornge relies on its helicopter air ambulance
that any trends and significant variances
service provider to monitor the percentage of time
from expectations are investigated; and
that helicopters are functional—that is, times they
are not out of service owing to, for example, main- • the Ministry of Health and Long-Term Care,
in conjunction with Ornge, should expand
tenance. The service provider reported that, for the
the service agreement’s performance require-
period from February 2010 to January 2011, at least
ments to include indicators on response times
one helicopter per base was functional 99% of the
for the key stages of a patient transport (that
time and therefore available for patient transports.
is, from the time a call is initially received,
to when Ornge is on site, and to when the
Departure to Arrival patient reaches his or her destination).
We noted that the air ambulance program in
another Canadian province used the estimated ORNGE RESPONSE
time required to travel between airports to evaluate
Ornge agrees with this recommendation and
whether its air transport times were reasonable.
will work with the Ministry to implement it.
Although Ornge has some information on the
actual travel time required to pick up and transport
MINISTRY RESPONSE
patients once aircraft have left the base, Ornge does
not do any overall analysis of this information to The amended performance agreement will
determine whether expected transport times are include greater emphasis on performance
being met most of the time. At the time of our audit, standards and reporting obligations and will
Ornge was implementing a system to automatically stipulate performance indicators related to sig-
record data about when aircraft became airborne nificant points in the processing of and response
and when they landed to assist in tracking the time to a request for air ambulance services.
36 Special Report
OVERSIGHT OF OPERATIONAL Compliance with Aviation Requirements

ACTIVITIES
The performance agreement requires that Ornge
We reviewed a number of the processes in place to ensure that its air ambulance service providers
monitor air ambulance service delivery. meet the aviation standards established by the Min-
istry of Natural Resources (MNR) and Transport
Canada. MNR may also conduct, at any time and
Ministry Service Reviews
without warning, safety audits of air carriers that
The Ambulance Act (Act) requires that ambulance provide service to the province.
operators be certified by the Ministry. To become In November 2006, MNR informed the Ministry
certified, service providers must meet ministry that an aviation safety audit should be conducted
requirements, including having aircraft equipped on Ornge to follow up on incidents involving its ser-
with certain patient-care equipment in good work- vice providers, including smoke in an aircraft cabin
ing order and in sanitary condition and having and landing-gear problems. At the time, MNR was
qualified paramedics competent in the use of such concerned that Ornge was not working with the
equipment. Providers must be at least 90% compli- service providers to adequately address the issues.
ant to pass a service review. The Ministry generally In December 2006, the Ministry asked Ornge to
conducts service reviews of certified providers every agree to MNR conducting such an audit. Ministry
three years, with new carriers reviewed within six documents from 2007 note that MNR could not
months of when they start to provide services. gain access to Ornge records for audit purposes.
In our 2005 audit of land ambulance services, No audit was conducted. Ornge advised us that it
we recommended that the Ministry conduct a rea- complies with MNR standards and stipulated this in
sonable number of unannounced reviews to ensure its annual report to the Ministry.
consistent quality of service. However, although the With Ornge preparing to start its own airline to
Act allows the Ministry to conduct unannounced deliver air ambulance services in 2008, MNR con-
reviews, the Ministry’s current policy is to provide ducted a short informal field visit to an Ornge base.
advance notice of at least 90 days. However, MNR told us it was too soon at that time
We examined a sample of reviews of air to conduct an audit because Ornge had not fully set
ambulance operators and found that, despite the up airline operations.
advance notice, about one-third, including Ornge, MNR informed us that, subsequent to our field-
did not pass their scheduled review the first time. work, it conducted an audit of Ornge in 2011 that
The reviews cited issues such as aircraft that were noted only what it described as “minor” findings.
not properly stocked with medical supplies and MNR further indicated that the certification process
equipment, medical oxygen equipment that was was changed in 2011 to include an MNR audit of
improperly maintained or calibrated, and para- service providers in addition to the Ministry’s ser-
medic call reports that lacked required patient vice reviews.
information. However, all of the air operators that
initially received scores below 90%, including
Ornge Reviews of Service Providers
Ornge, were found on subsequent inspection to
have improved enough to pass the review. Ornge contracted with an independent aviation-
The Ministry has never conducted a review of services consulting company to conduct operational
Ornge’s dispatch function, although it indicated reviews of its air ambulance service providers.
that one is tentatively scheduled for 2012. The consultants review, among other things, the
service providers’ manuals, staff training and
quality-assurance processes, and aircraft inspections. issues and the results of investigations to identify
Between May 2008 and January 2010, the consult- any systemic matters requiring further action.
ants conducted reviews of six service providers. No In some cases, individuals complain directly to
significant issues were identified. Subsequent to our the Ministry. The Ministry usually suggests that the
fieldwork, Ornge indicated that it contracted with complainant first try to resolve the issue directly
another aviation-services consulting company that with Ornge or the service provider. If that proves
had completed six more reviews (four in June 2011 unsatisfactory or the complaint involves a signifi-
and two in September 2011) and had scheduled an cant issue, the Ministry will investigate.
additional four. The Ministry has investigated about 15 com-
Ornge’s contracts with its service providers plaints a year since Ornge became responsible for
allow it to personally inspect them twice a year to providing air ambulance services to Ontarians in
ensure compliance with its policies and standards. 2006. We reviewed a sample of Ministry investiga-
The inspections cover such things as equipment, tions from 2008 to 2010 and noted that half dealt
supplies, cleanliness and pilot training. The two with delays in responding to calls. The Ministry
service providers that Ornge inspected in 2009 and shares the results of its investigations with Ornge.
2010 provided about 70% of airplane transports. However, in October 2010, it stopped recom-
Using a standard checklist, Ornge generally con- mending ways for Ornge to address issues, stating
cluded that both of the airplane service providers it that such decisions were Ornge’s responsibility. The
inspected were meeting its standards. Ornge used Ministry indicated that Ornge generally provides
the same checklist to conduct similar inspections of it with information on actions it takes to address
its own fleet in 2009 and 2010, with similar results. issues raised in Ministry-conducted investigations.
In our 2005 land ambulance audit, we recom-
mended that the Ministry implement a process to
Complaint Investigations
ensure it consistently receives information on the
Both Ornge and the Ministry may conduct investi- nature and resolution of more serious complaints
gations based on complaints or concerns forwarded that it does not directly investigate to help it iden-
to them by the public or staff. tify as soon as possible any systemic issues or poten-
In 2010, Ornge logged about 60 public com- tial problems that could recur. However, we noted
plaints and 500 staff concerns, which included at the time of our current audit that when Ornge
operational issues of varying degrees of import- investigates a serious complaint, it does not share
ance. Ornge assesses each issue and decides which the results with the Ministry, unless the Ministry is
complaints to formally investigate. In 2010, about investigating the same complaint.
half the issues were formally investigated. Ornge
indicated that the others were followed up at its
Incident Reporting
bases. Although it had not tracked the nature of the
complaints and concerns, Ornge informed us that The performance agreement requires that Ornge
most related to patient care, delays in responding submit an incident report to the Ministry within
to requests for ambulances, and communications five business days of each “significant adverse
problems between, for example, staff at the Ornge event.” It defines a significant adverse event as a
Communications Centre and paramedics. Ornge “critical or major occurrence that results in serious,
also indicated that, in March 2011, it introduced a undesirable, or unexpected Patient outcomes that
new system to record public complaints and staff have the potential to negatively impact a Patient’s
concerns that would enable it to better analyze the health and quality of life; significant interruption in
38 Special Report
the delivery of the Services; significant deteriora- The reviews focus on patients with heart-related
tion in the quality or delivery of the Services; or an issues, breathing issues, blood infections, trauma
aviation accident involving an Air Carrier providing and brain injuries, as well as obstetrical and pediat-
Air Ambulance Services.” Ornge indicated that it ric patients. Ornge generally reviews each of these
reported five significant adverse events to the Min- focus areas twice a year. The reviews look at Ornge’s
istry and its board between 2006 and 2010. call reports for a sample of 60 patients transported
However, we found that Ornge internally for each focus area during the previous six months
reported 20 “significant patient adverse events” and compare them to Ornge’s evaluation measures
in 2009/10 to its board of directors, including for what constitutes good practice. In addition,
some that involved patient deaths. (Ornge defines every month, Ornge’s transport-medicine physicians
a “significant patient adverse event” as a critical review call-report information on all patients who
or major occurrence that results in serious, were intubated (a procedure in which a tube is
undesirable, or unexpected patient outcomes with inserted to help the patient breathe). Review results
potential to negatively affect a patient’s health and are published in the staff newsletter each month
quality of life.) and reviewed by the Ministry during its service
Ornge reported significantly fewer of these reviews, the most recent of which was in 2009.
significant patient adverse events to the Ministry. Ornge indicated that most of its evaluation
Ornge indicated that doing so was in accordance measures were developed in 2008 following a
with the performance agreement and that many of review of medical literature and studies, and that
the events reported to its board were not deemed its transport-medicine physicians have selected
significant enough to report to the Ministry, such as the evaluation measures most important to patient
a patient going into cardiac arrest but subsequently care. We compared those evaluation measures to
being revived. However, because Ornge reports authoritative guidelines and sought expert advice.
many more adverse events to its board than to the We identified various evaluation measures that
Ministry, we were concerned that the Ministry would be important to patient care that were not
may not be receiving all the information it needs to being used by Ornge. For example, Ornge’s review
enable it to monitor the services provided by Ornge. of on-scene cardiac-case calls did not examine
whether electrocardiograms were done on patients
with chest pains as soon as possible, as is recom-
Ornge Clinical Quality Assessment
mended in the 2010 American Heart Association
Under its contract with the Ministry, Ornge pro- Guidelines. The results of our work were shared
vides medical oversight for air ambulance services. with Ornge for its consideration.
To help ensure that they are providing patients with Ornge informed us that, aside from evaluating
good care, Ornge’s transport-medicine physicians the clinical care provided to meet patients’ medical
conduct reviews of the clinical care provided to needs, it also recently began evaluating patient
patients. The reviews include, for example, whether safety during transport. The relevant measures
paramedics performed a medical procedure cor- include whether patients’ ears are protected during
rectly, whether patients received the right medi- noisy flights, whether restraints protecting patients
cation for their condition, and whether data on from turbulence are correctly used and whether
patient care was correctly recorded to give receiv- patients are satisfied with the air temperature (it
ing hospitals complete information on a patient’s can get cold in airborne helicopters).
treatment and condition.
RECOMMENDATION 5 MINISTRY RESPONSE

To better ensure the safe provision of air ambu- In June 2011, the Ministry implemented unan-
lance services: nounced inspections for the air ambulance pro-
• the Ministry of Health and Long-Term Care gram. In addition, the amended performance
(Ministry) should periodically conduct unan- agreement will improve oversight and account-
nounced service reviews of air ambulance ability, including increasing ministry audit and
service providers, including Ornge and its inspection powers.
dispatch communications centre; The amended performance agreement will
• Ornge should use its recently improved com- also require Ornge to report all complaints and
plaint tracking system to determine whether aviation accidents/incidents to the Ministry,
there are any systemic issues that warrant and a determination with respect to investiga-
follow-up; and tion requirements will be made. In addition, as
• Ornge should continue to review its quality an ambulance operator, Ornge is required to
assessment evaluation measures and update adhere to the legislated Ambulance Service Docu-
them as necessary to ensure they reflect key mentation Standards, which stipulate additional
elements of good patient care. reporting requirements such as for collision and
To improve its monitoring of air ambulance incident reporting. The Ministry supports and
services, the Ministry should clarify with Ornge encourages continuous quality improvement,
which complaints, incidents and resulting inves- and the amended performance agreement will
tigations Ornge must forward to the Ministry. include quality-improvement and patient-rela-
tions provisions that are based on the Excellent
ORNGE RESPONSE Care for All Act, 2010.
Ornge agrees with this recommendation and will

work with the Ministry to better utilize its com-
plaint tracking system and to ensure updated
quality assessment evaluation measures.
Office of the Auditor General of Ontario
Box 105, 15th Floor

20 Dundas Street West
Toronto, Ontario
M5G 2C2
www.auditor.on.ca
ISBN 978-1-4435-9107-2 (Print)
ISBN 978-1-4435-9108-9 (PDF)

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Special Report

Ornge Air Ambulance

To the Honourable Speaker

I am pleased to submit to you my Special Report on

Ce document est également disponible en français.

ISBN 978-1-4435-9107-2 (Print) Cover photograph: Kevin Thom

Audit Objective and Scope 6

Detailed Audit Observations 10

OVERVIEW OF THE PATIENT TRANSPORT PROCESS 10

ORNGE’S PERFORMANCE AGREEMENT WITH THE MINISTRY 11

OVERSIGHT OF OPERATIONAL ACTIVITIES 36

care services being provided by external entities

We conducted our audit work primarily at Orn-

• lists of the shareholders or owners of these

a physician or CritiCall, an organization funded by

Figure 3: Ministry Funding to Ornge, January 2006–2010/11 ($ million)

Figure 4: Number of Patient and Other Transports1 by Type, 2006/07–2010/11

Transport Type 2006/07 2007/08 2008/09 2009/10 2010/11

Ornge — 34 556 1,365 1,487

Ornge Global Holdings LP

Issuer Trustee Ornge Issuer

accessible to ministry monitoring and oversight through

A B A owns B but does not have decision-making control over B

A B A does not own B but has decision-making control over B

Figure 6: Chronology of Key Events Relating to Head-office Space

patient care and facilitate the education and train-

and 10 designated delivery agents in remote areas.

receives transport requests through PTAC, collects

New Dispatch System

OVERSIGHT OF OPERATIONAL Compliance with Aviation Requirements

RECOMMENDATION 5 MINISTRY RESPONSE

Ornge agrees with this recommendation and will

Box 105, 15th Floor

ISBN 978-1-4435-9107-2 (Print)

ISBN 978-1-4435-9108-9 (PDF)

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