District council has joined a growing number of municipalities concerned with the increasing hospital capital costs they’re having to shoulder.
At its February 22 meeting, District council unanimously passed a resolution calling on the province to conduct a “re-examination of the ‘local share’ hospital capital calculation methodology, to better reflect the limited fiscal capacity of municipalities, and the contributions to health care services they already provide to a community.”
The resolution reminds senior levels of government that healthcare funding is a provincial and federal responsibility. It notes that from 2009 to 2020 a total of $415.4 million has been transferred from municipal operations to fund and build provincial hospitals while remaining “long-term commitments to hospitals stand at $117.5 million (as of 2020), which will also be financed from municipal operations.”
It also states that “a community’s total contribution to local hospitals also includes the donations made by benevolent individuals, groups, and businesses along with municipal contributions,” and while a community’s required local share amounts to 10 per cent of capital construction costs, it also amounts to 100 per cent of costs such as hospital equipment, furniture, and fixtures which includes medical equipment such as MRI machines, CT scanners, and x-ray machines.
This translates to a 70 per cent provincial share and 30 per cent local share (individuals, groups, businesses, and municipalities) of the overall cost of provincial hospital operations and capital projects, according to the resolution, and “the adoption of the ‘design-build-finance’ hospital construction model (also known as alternative financing and procurement or P3 projects), has increased local share amounts because they now include the costs of long-term financing…”
The resolution, which has been forwarded to the Minister of Finance, the Minister of Health, the Minister of Municipal Affairs and Housing, and the Association of Municipalities of Ontario, also adds that hospital equipment which has risen in cost is also having to be purchased with increasing frequency with an average lifespan of ten years.
Councillor Rick Maloney said the issue is not unique to this area and it is one that the Association of Municipalities of Ontario (AMO) has taken up.
“The messaging shouldn’t be that we don’t want to support our hospital,” said Maloney, noting that his municipality and the District have put financial contributions aside in their 2022 budget for new hospital sites in Bracebridge and Huntsville. He said while fundraising and support for the hospital needs to continue, “what this resolution does it just highlights there is some significant inequality with the local share and responsibility filtering back down onto the tax base.”
Councillor Frank Jaglowitz said the resolution is important because what’s essentially happening is a downloading of costs. “I was the treasurer of our Cambridge hospital for many years and there’s a big change from when I was involved and… we say well possibly the province can’t do anything about it but just yesterday they removed the cost of renewing your vehicle licence so the province can do something and I would hope that we would keep on the province to pay their fair share of these social programs and hopefully we will have a member there that will help us with that.”
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