By Thomas Goyer
The equity of hospital funding is dividing the Muskoka District Health Committee.
At the September 21 District Health Committee meeting, the proposal for raising the local share of the cost of developing two new hospital sites in Muskoka was discussed.
The total project is estimated at $967 million dollars, with the Provincial government providing $742 million dollars in funding. This leaves the local share required at $225 million dollars for the project. Both hospital foundations have committed $35M each and Muskoka Algonquin Healthcare, which manages both the Huntsville and Bracebridge hospitals, has committed to raising $38.2M through the sale of assets.
The local share component, and which residents will be using the facility, led to a debate about the equity of hospital funding within Muskoka. One of those who had issues with the proposal was Muskoka Lakes Councillor Ruth-Ellen Nishikawa. She stated that this was not a proposal for Muskoka as a whole, but instead, it was a proposal for east Muskoka.
“This report is about east Muskoka; this report is about the Highway 11 corridor. It does not address west Muskoka at all,” Nishikawa said.
Nishikawa highlighted that for many people living in Muskoka Lakes it is faster and more convenient to go to the hospital in Parry Sound rather than to use MAHC hospitals. But despite this lack of use these same residents would have to pay for these new hospitals.
“We’re asking Muskoka Lakes to pay 38 per cent, where most of our residents will never have access to these hospitals,” Nishikawa said.
Displeasure at having to pay for services their constituents will likely not use was shared by Georgian Bay Councillor Brian Bochek.
“We have a population over there that is not being serviced at all. They are not coming to Gravenhurst, they are not coming to Huntsville. So, this absolutely does not work for our township,” Bochek said.
Presently the municipalities of Bracebridge, Gravenhurst, Huntsville, and East Parry Sound have made commitments totaling $30.5 million dollars to the local share. The proposal put forward by staff recommended that the District commit $77.3 million dollars toward the local share. The District commitment would have to be shared by Muskoka taxpayers.
Nishikawa expressed concerns for the financial burden being carried by Muskoka Lakes residents and the increasing affordability issues that local taxes are adding to.
“I’m concerned about my taxpayers, and I’m actually really concerned about my family being able to stay in Muskoka,” Nishikawa said.
According to the proposal, staff calculated that a 13-year plan to raise the District local share commitment would increase property taxes on a $300,000 assessed home by an estimated $4.29 per year and $14.30 per year for a home assessed at $1 million.
But it was not only the future costs of the project that caused concern among councillors. Another issue raised was the history of hospital spending by the District. Georgian Bay Councillor Peter Koetsier, who attended the meeting despite not being on the Health Committee, went over the statistics which showed a large disparity in funding across Muskoka. Koetsier read statistics from the staff report which stated that of the $5.1 million dollars in hospital grants since 2009, only $15,000 was spent on the Georgian Bay General Hospital. Koetsier stated that this spending was unfair for an area with 8 per cent of the area’s population.
“If you want to do the math, that’s one-quarter of 1 per cent went to Midland (Georgian Bay General Hospital). Can I repeat that? One-quarter of 1 per cent, for 8 per cent of the population and 8 per cent of the overall financial contribution. Frankly, that’s not fair.”
Koetsier and Bochek advocated for amendments to the proposal to allow for concessions to the smaller and unaffected municipalities. Koetsier suggested allowing each municipality to choose where its local share contributions are spent.
“If we’re going to collect health and hospital tax from them, they should be able to allocate it to the hospital they’re going to use,” Koetsier said.
While almost every member of the committee acknowledged that there were legitimate fairness questions involved in this project, some raised concerns that the committee should not throw away the proposal. Committee Chair Terry Glover stated that the committee must be careful not to lose a great opportunity for Muskoka.
“There’s a lot of other hospitals waiting for this opportunity. I can’t see it coming around quickly again,” Glover said. Chair of the MAHC Board Moreen Miller echoed those concerns.
District CAO Julie Stevens stated that the current stage of the development process must be completed by January. Not meeting this deadline would mean that the project would likely be removed from Infrastructure Ontario’s list of procurement projects list. Being removed from the list would in effect put the project at the back of the queue and put the project back even longer.
As highlighted in the report, the MAHC facilities are often at 140 per cent capacity. The buildings are also difficult to update causing further operational issues. Overcrowded and out-of-date facilities concerned Glover. He said that it would be difficult to attract healthcare workers to Muskoka.
“What message are we sending to the public and to our health care workers if we say at council here in a month’s time, we don’t support upgrades and fixing up our hospitals,” Glover said.
These concerns were shared by District Chair Jeff Lehman who stated that the district needs the updates.
“Muskoka needs this so badly and so clearly. I mean, it’s not just the capacity issues. It is the fact that we’re a growing municipality… we saw that during the past few years, and we know what’s coming in and the pressures are very real on our hospitals, and so the capacity is needed,” Lehman said.
After further debate among councillors an amendment was drafted and adopted which pledged to further increase funding to local hospitals separate from the MAHC project.
Committee approved the proposal which will be sent to District Council for further debate and final approval.
You can find the staff report, HERE.
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Hi Jacquie, as per both District and Huntsville municipal staff, the funds will be invested at an estimated rate of return of at least four per cent.
I believe this is a report of a committee but it appears to be moving forward. Am I to understand that the approximate rates quoted are for the District taxes. In addition there will be additional taxation at the local level??? (10 million ) I also assume that these rates will increase every year due to inflation and the gentleman above is right. Add 30%. THERE IS ONLY ONE TAX PAYER. WE ARE PAYING TWO
Muskoka ADMINISTRATIONS FOR ONE PROJECT plus provincial/ federal taxes.
There is concern above about fairness, if I understand the demographics of much of Muskoka many people will never be alive to use these facilities and there are insufficient long term beds that will be require in the next 15 years. This will put additional demands on our hospitals. We will need to increase our commitment locally/district wide to maintain them
Please share all these costs with the tax payer before accepting unknown blank recommendations
Town & District Councillors should spend adequate time in understanding that hospital development and redevelopment projects in Ontario (and throughout Canada) by the end of the development cycle are regularly over their planned budgeted dollars. Some are significantly over due to changes that logically occur during the multi year construction process. While the targeted capital cost currently is $967M no one should be surprised if the project at completion is in the range of $1.150B conservatively. The last half dozen capital development projects in Ontario have been as much as 30% over their originally planned and approval budget. The District and Towns should plan for the local share to move from the planned $225M to at least $255M at the current run rate.