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The Alberta government has terminated its funding contract with doctors and will impose 11 changes to physician rules and fees in what it calls a necessary move to control ballooning health-care costs in the province.

Health Minister Tyler Shandro said the province will maintain physician funding at current levels while it takes steps to avoid $2 billion in cost overruns, after negotiations with the Alberta Medical Association fell apart.

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The contract with doctors, which had been set to expire at the end of March, encompassed the broad relationship between doctors and the government, including working conditions and compensation.

The UCP government says a new funding framework will be put in place March 31, which includes reforms designed to prevent cost overruns and align benefit programs and administrative fees with other provinces.

Negotiations between the AMA and UCP government broke down last Friday following a voluntary mediation session deemed unsuccessful by both sides. With no agreement reached through negotiations, which began in January, the province will instead implement terms of its final offer.