There may be good news for Ontario’s hospitals in the 2016 provincial budget, but exactly how good that news will be for Muskoka’s two hospitals remains to be seen.
The province has announced an additional $345 million for Ontario’s 154 publicly funded hospitals. It also announced a one per cent base funding increase to all hospitals. Muskoka Algonquin Health Care, which administers both the Huntsville and Bracebridge hospitals, could see an increase of about $500,000 in 2016 if everything remains the same, explained the organization’s Chief Financial Officer, Tim Smith.
“That’s the problem with these funding announcements… we still have the Health System Funding Reform and the funding formulas, but if we got the same amount of money this year as we did last year it would be about a $500,000 increase in funding,” said Smith. That, unfortunately, is not a major dent in MAHC’s anticipated $3.9 million shortfall for 2016. And still, what that one per cent will really mean won’t be known until the increase flows through the Ministry’s funding formula. That formula, which started rolling out in 2012, aims to move hospitals away from a global funding model and closer to funding that follows the patient and creates greater incentives for greater efficiencies, as is often touted by the Ministry.
“So while they’re putting an extra one per cent in the pool, it all depends on how you make out under the formula – whether you get more or less,” said Smith who explained that there are three different pods of funding hospitals receive. What’s referred to as “base funding” makes up about 30 per cent of the hospital’s funding. Then there’s the Health Based Allocation Model (HBAM) that the Ministry of Health and Long-Term Care uses to allocate funding to hospital services. That formula considers a number of variables such as expected population growth, the size of a hospital as well as the historical number of procedures to predict the cost and number of services hospitals should be providing each year. Then there’s Quality-Based Procedures, which involves the funding of specific procedures such as cataract surgery, knee replacement as well as congestive heart failure.
Ontario’s 2016-2017 budget also announced an additional “$7.5 million for small, northern and rural hospitals, which is in addition to Ontario’s $20 million Small and Rural Hospital Transformation Fund,” states the Ministry’s press release.” Unfortunately, MAHC won’t see any of it as Muskoka’s hospitals are considered medium-sized hospitals by the Province, explained Smith.
It also announced an additional $160 million to improve access and wait times for hospital services, including additional procedures such as cataract surgeries, knee and hip replacements and knee arthroscopies, but again, whether MAHC sees any of that will depend on where it falls within the funding formula.
“We do cataract surgery here but we don’t know they’re going to allocate that additional cataract funding across the province. I’m guessing they would probably look at wait times for cataract surgery and maybe allocate it to those LHINs (Local Health Integration Networks, which distribute the funding) that have the longest wait-times. But I’m half speculating. I really don’t know how they’re going to allocate it,” said Smith who says as the announcements roll out he anticipates it’ll take about a month to figure out whether MAHC will benefit from the funding announcements.
On a positive note, Smith said any announcement of more health care funding is good news. “Especially after four years of zero per cent funding increases. It’s very welcomed to see that the government is actually recognizing that hospitals have to have an increase in their funding,” he noted.
Again, MAHC is expecting a funding shortfall of roughly $3.9 million for 2016-2017. It was short about $2.6 million in 2014-2015 but MAHC managed to reduce spending by approximately $1.2 million by year-end and managed to secure an additional one-time funding of $1.5 million from the Ministry, which led to a balanced budget, said Smith.
“We have inflationary increases that affect us every year with a zero per cent funding increase and up until last year we were actually seeing a decrease in funding under the funding formula,” said Smith, who is hoping news of the type of funding MAHC can expect will be revealed sometime in late March.
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