Alberta’s premier is not offering any comment amidst the firing of Alberta Health Services’ former CEO, which comes with allegations of corruption surrounding health procurement contracts and sweetheart deals for private surgery providers.
Athana Mentzelopoulos, the former CEO of Alberta Health Services, said her contract was terminated on Jan. 8, just two days before she was allegedly going to meet with the province’s auditor general regarding an internal investigation into procurement contracts.
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The news came out in a letter obtained by the Globe and Mail from Mentzelopoulos’ lawyer to AHS’s interim general counsel, which was sent on Jan. 20.
Contents of the letter allege Premier Danielle Smith’s then-chief of staff, Marshall Smith, had also interfered in AHS contract negotiations.
CTV News reached out to Premier Smith’s press secretary, Sam Blackett, for a response, who said the premier is declining to comment.
Smith has not mentioned if she is aware of the allegations but has been publicly posting to social media on issues from fentanyl drug trafficking, cryptocurrency and oil and gas pipeline projects.
Instead, Blackett referred CTV News to a statement from Alberta’s Health Minister Adriana LaGrange, which was sent Thursday.
Alberta Health says the recent personnel and board changes at Alberta Health Services are part of the planned Feb. 1 transition of AHS into a service provider under the newly constituted Acute Care Alberta agency.
“As to the allegations made by the outgoing CEO, Alberta Health Services is reviewing them, but the interpretation that her termination was due to AHS’s review of certain procurement decisions are false,” read a statement from LaGrange’s office.
“We understand that AHS has been reviewing these procurement decisions and processes and that work will continue until it is completed.”
LaGrange went on to say that she now welcomes a review from auditor general Doug Wylie, but no further comment will be provided.
Wylie told CTV News that despite not meeting with Mentzelopoulos and acknowledging her concerns, his team will now conduct an investigation.
“At this time, the examination pertains to chartered surgical facilities, medication (ibuprofen or acetaminophen), and COVID-19 personal protection equipment,” Wylie’s statement read.
“The examination is looking at the effectiveness of management and control processes— including governance and oversight—ensuring value for Albertans while addressing concerns or allegations related to contracting and potential conflicts of interest.”
The Alberta RCMP also confirmed in a statement on Thursday that it has received a letter related to the investigation.
Alberta Health Services puts hold on contracts
Alberta Health Services says it is now conducting a review of its procurement procedures related to matters raised by its former CEO.
“In the interim, we have paused the awarding of any contracts involving the parties that are involved in that review,” said Holly Budd with AHS communications.
“Until this review and the auditor general’s review have been completed, we will not be commenting further.”
AHS did not specify which companies are part of the temporary ban on new contracts.
At the time, Mentzelopoulos had been digging deeper into a company known as MHCare Medical Corporation and its CEO, Sam Mraiche.
Her letter indicated she investigated AHS’s relationship and contracts with the company that facilitated Alberta’s $75-million deal to import generic children’s pain medication from Turkey in 2022.
Only 30 per cent of the children’s medication was received despite paying up front. The rest of the order is not likely to be received and AHS has since stopped using the remaining supply for safety reasons.
The letter obtained by the Globe and Mail also noted that Mentzelopoulos was allegedly facing pressure to sign new deals for chartered surgical facilities, which are considered private outfits that perform operations paid for by the government as part of the public health care system.
The Globe and Mail says Mentzelopoulos’ letter noted she was also pressured to extend a contract for the Alberta Surgical Group.
“Throughout 2024, Mentzelopoulos had been repeatedly subject to interference and pressure from various Government of Alberta officials – including the Premier’s then-Chief of Staff, Marshall Smith – to sign off on commitments for the new CSFs and approve a contract extension for ASG, despite significant concerns within AHS around the true ownership and potential costs of the CSFs and concerns over the significantly increased costs of a proposed new ASG contract,” the letter reads.
Mentzelopoulos’ letter states she is prepared to sue for wrongful dismissal, demanding the province pay her roughly $1.7 million, which is the amount she would have made had she been able to serve out the rest of her contract.
Mentzelopoulos took office as AHS’s chief executive officer in December 2023 as part of the UCP government’s plans to revamp the organization and reduce costs.
She had also previously served as the executive director of the Alberta Medical Association and as Alberta’s deputy minister of finance.
MHCare Medical and Alberta Surgical Group respond to allegations
Legal counsel for MHCare Medical Corporation responded to a request for comment from CTV News, noting that their client “recognizes the importance of this coverage” but is unable to provide further details at this time.
Gregory Bentz, a lawyer with STILLMAN LLP, however, provided the following statement.
“Based on what our client has learned, the claims and insinuations made against them are based on a flawed perspective, is without merit and contrary to substantiated evidence,” said Bentz.
“We are confident that, as the process unfolds, the full facts will come to light and demonstrate that our client has acted properly at all times.”
The Alberta Surgical Group also responded in a statement, noting that it was “deeply shocked and dismayed” by the allegations.
“ASG has always been committed to upholding the highest standards of patient care, safety, and professional integrity. The claims being made are false and do not reflect our values, our mission, or the dedication of our team to providing exemplary surgical services efficiently and cost effectively,” read the statement.
“Timely access to surgical care has been a concern to all Albertans.
“ASG has functioned as a relief valve to help alleviate the surgical backlog and excessive wait times that have plagued Albertans. ASG does not perform privately funded procedures.”
ASG went on to say it welcomes the opportunity to address concerns related to its operations and agreements with AHS and Alberta Health.
Opposition NDP calls for Smith to resign
Alberta’s opposition NDP is now calling for Premier Danielle Smith to resign as allegations swirl around the reasons for firing the previous CEO and Board of Directors at Alberta Health Services.
“The allegations about UCP interference are shocking, and Albertans deserve to know what’s going on,” said Sarah Hoffman, Alberta NDP shadow minister for health.
“In January, the UCP government fired Danielle Smith’s hand-picked Alberta Health Services (AHS) CEO and Board of Directors. It is likely the UCP government asked those same individuals to sign non-disclosure agreements. Albertans deserve to hear the full story. The public deserves nothing less than the truth.”
Hoffman went on to call on Minister LaGrange and Premier Smith to “stop the secrecy” and cancel any non-disclosure agreements.
“The UCP is causing chaos in health care: focusing more on firing managers and CEOs than on hiring doctors and signing contracts with health-care workers to ensure staff can focus on patient care,” Hoffman said.
Meanwhile, other medical groups, including the United Nurses of Alberta, are also speaking out.
United Nurses of Alberta president Heather Smith says this story “contains many deeply serious and troubling” allegations that demand a timely and formal investigation.
“At a time of needless upheaval in Alberta’s health care system that includes an aggressive program of privatizing activities such as surgical procedures that should remain in the public system, we need to consider the message this sends to frontline employees like UNA’s members about the organization they work for and the government that is driving its agenda,” Smith said.
“All Albertans deserve to know what has happened and why it has happened,” Smith added. “That should include the true cost of the Alberta Surgical Initiative, the contract process and who is profiting from this policy.”
‘The most serious scandal’
Keith Brownsey, a political scientist with Mount Royal University, notes that allegations of this nature can be career-ending for politicians and that taxpayers deserve to know the truth.
“This is the most serious scandal an Alberta government has faced.” Brownsey said.
“We have a government essentially taking hockey tickets to give health-care contracts, and that doesn’t smell good. There’s something wrong here, and there needs to be an investigation and in the past, there have been royal commissions.”
Brownsey adds that an independent review is what is needed to ensure accountability, but Premier Smith is ultimately the one individual who needs to be held to a much higher standard.
“I mean, there’s no denying that something went on here, and it is the buck stops with the premier. Their premier should resign. There really is no way out of this,” he said.
“Why hasn’t Smith responded to this more forcefully? She will next week, she’ll come out and say that we’re going to wait for the police to conclude their investigation, which will be a year and a half or two years away. She’ll just deflect.”
