Ontario Pre-Budget Hearings, December 8, 2016, presented by Natalie Mehra, Executive Director, OHC
This summer my mother (whom I have brought with me today) and I, had the experience of going to the emergency department at the Smiths Falls hospitals after a nasty run in with razor sharp zebra mussels while swimming. We arrived at 3 pm. We saw the triage nurse after almost 2 hours. We saw the doctor at 8:30 pm, five and half hours after arriving. According to Ontario’s Auditor General – as revealed in her recent report – we were lucky.
For the better part of a decade, the Ontario Health Coalition and local health coalitions have given testimony at these Pre-Budget Hearings each year, detailing the devastating hospital service cuts that have resulted from real-dollar funding cuts to Ontario’s public hospitals year after year. We have documented for the Members of this Standing Committee, Ontario’s descent to the bottom of the country on key capacity indicators in our hospitals:
• Ontario has the fewest beds per person left in the country;
• Ontario has the fewest nurses per patient in Canada (both RN and RPN);
• Ontario is in the bottom rungs for funding of our public hospitals by every reasonable way of measuring funding (by population, as percentage of GDP).
Today, we want to bring you up to date on the state of our province’s public hospitals and the impact of the government’s fiscal (budget) policy on them. Due to time constraints, we will focus our testimony on public hospitals where the majority of cuts are happening. We will include other health sectors in our written report.
This year, though we are finally seeing some real movement, public hospitals are still being cut.
The Bottom Line: Public Hospital Funding in the 2016 Ontario Budget
Across the board, their global funding increase this year, as announced in the 2016 Ontario Budget is less than 1 percent. This is far below the consumer rate of inflation which is reported as 2.1 percent for October 2015 – October 2016 by Stats Canada. (Source: Statistics Canada, CANSIM, table 326-0020 and Catalogue nos. 62-001-X and 62-010-X. Last modified: 2016-11-18.)
This follows four years of 0 percent funding increases.
It is the ninth consecutive year of realdollar hospital cuts, meaning that hospital global funding increases have not even met the rate of inflation for almost a decade. The planned and purposeful underfunding forces local hospitals to cut ever more services.
Despite government claims that make it look like all hospitals are getting an overall 2 percent increase, the fact is that only a minority of hospitals – usually larger hospitals and those in high growth areas and those that have highly specialized services like provincial childrens’ hospitals or those that do organ transplants – got the 2.1 percent funding increase in this year’s budget. Even so, this rate is not enough to meet their population growth and inflationary costs.
At the same time as implementing a decade of real-dollar funding cuts, Ontario’s government has changed the hospital funding formula. As a proportion of total hospital funding, global funding (which covers overhead costs and general hospital operational costs) has been shrinking. Today, global funding is only one-third of hospital budgets. The hospital global funding crunch accounts for a great deal of the hospital cuts that we are seeing across Ontario.
The funding formula changes have forced the dismantling of community hospitals as we know them, forcing specialization and centralization of care into fewer locations with patients forced to travel further for services.
Extra Money Announced in the Fall Economic Statement: Funding Now Meets General Inflation — But Not Population Growth and Aging
In the economic statement this fall, the government announced an additional $140 million for public hospitals. According to the government, this increases hospital funding by 3 percent this year.
However, as in the 2016 Budget announcement of 2.1%, only a minority of hospitals with the specialized services that are being funded through special envelopes will get the full 3 percent rate or more. Most of Ontario’s hospitals will get 2 percent or less.
While we are extremely pleased to see that the government is moving away from the years of real-dollar cuts that have been so devastating to community hospitals all across the province, still, it is important to note that this funding level simply meets the basic rate of consumer inflation but is not sufficient to meet population growth and aging. There is an almost-total consensus among health policy experts and economists that aging adds 1 percent in costs. Ontario’s current population growth rate is 1.2%. (Ontario Ministry of Finance: Ontario Population Projections Update, 2015–2041 Spring 2016.)
The Financial Accountability Office of Ontario has calculated that to meet inflation, aging and population growth, health spending requires a 5.2% escalator.
“Assuming that the quality and type of health care services provided in 2015 remains the same over the outlook, the FAO estimates that population growth and aging would contribute 2.2 percentage points per year on average to the growth in health spending. A stronger economy, which leads to higher incomes and price inflation would contribute a further 3.0 percentage points. Combined, these factors would lead to 5.2 percent annual growth in health spending.” (Source: Financial Accountability Office, Ontario Legislature, Spring 2016.)
Given the losses over the last decade and the deep hole that many hospitals now find themselves in, Ontario needs a real plan to restore financial stability and reasonable and safe levels of service in our public hospitals.
Ontario’s Large Hospitals are in a State of Dangerous Overcrowding with Lengthy, Sometimes Catastrophic, Waits for Needed Care: Findings of the Ontario’s Auditor General
Ontario’s Auditor General describes the situation in Ontario’s large community hospitals in her report released just last week. Her findings support the evidence that we have brought this Standing Committee and government officials year after year after year. This is what the Auditor General relayed in her November 30 report on Large Community Hospitals:
(Page references for the 2016 Ontario Auditor General’s Report [were] are included here.)
• The audit team describes a state of severe overcrowding in the hospitals they visited. Patients are waiting on stretchers or gurneys in hallways and other public areas, sometimes for days (page 446).
• Bed occupancy rates of greater than 85 percent are unsafe and contribute to infections (beds are too crowded and turn over is too fast). During 2015, 60 percent of all medicine wards in Ontario’s large community hospitals have occupancy rates of greater than 85 percent (page 431). This means that the majority of large community hospitals are running at dangerous rates of overcrowding.
• The Canadian Institute for Health Information reports that Ontario hospital patients have the second highest rate of potentially fatal sepsis infections in Canada (page 431).
The Auditor General describes the consequences of chronic underfunding and the failure to plan to meet population need for care:
• 1 in 10 patients requiring admission to hospital are waiting too long in emergency departments. The provincial government’s target is 8 hours from triage (90 percent of patients are supposed to be transferred to a bed within 8 hours). But in the hospitals the audit team visited it took 23 hours for 90 percent of the patients to be transferred to the ICU and 37 hours for transfers to other acute care wards (page 429).
• The audit team described a situation across Ontario’s large community hospitals in which there are frequent and planned operating room closures. 45 percent of large hospitals have one or more OR closed due to funding constraints (page 450).
• There has been no improvement in wait lists for elective surgeries for the 5 years leading into this audit (pages 430-431).
• 58 percent of hospitals ran out of money for some types of surgeries and had to defer them to the next fiscal year (page 444).
• Patients with traumatic brain injury and acute appendicitis are waiting 20 hours or more for emergency surgery (page 430).
• Wait time targets are not being met forthe following types of surgeries: neurosurgery, oral and dental, thoracic, vascular, orthopedic, gynecologic, ophthalmic, cancer (page 451).
Imagine waiting 20 hours or more, in agony, for emergency appendicitis surgery.
The situation described by the Auditor General is a crisis brought on by a decade of planned and purposeful funding constraints, geared toward making local hospitals cut services.
We know what the Ministry of Health does not track. It does not track the cuts and closures that are a result of its government’s fiscal (budgetary) policy. The Ministry of Health does not track restructuring costs that are resulting from the forced cuts. Though it keeps a record of hospital occupancy rates (that is, how full each hospital is – a measure of overcrowding) the Ministry of Health does not plan or require that hospitals run at safe levels of crowding. The bottom line is this: the government has abandoned normal public hospital system planning and has instead planned to continually ration care with little concern for the consequences.
Getting Funding to Care: Restructuring, P3 Privatization, and the Siphoning of Public Money Away from Care
Not only are funding levels an issue for the province’s public hospitals, but getting funding to go to actual care and vital patient support services is also a priority recommendation of the Ontario Health Coalition and something that we hear everywhere as a priority for Ontarians.
Unfortunately, the trend is going in the opposite direction. Unsupported by any evidence, and without sound populationbased health care planning, a new wave of mega-mergers, service consolidations and closures of local hospitals is spreading across Ontario. Each of these projects costs hundreds of millions in new capital costs, and at least tens of millions in restructuring costs.
Right now we are seeing the forced mega-merger of the Durham and Scarborough Hospitals. Recently we saw three entire hospitals closed across the north and east of Toronto and replaced with one new P3 hospital at Hwy 400 (this is the Humber River Regional Hospital). In that consolidation, the government closed a hospital in one of the poorest Toronto neighbourhoods – Jane and Finch – and moved services further away for those residents. Now they are planning to close 5 entire hospitals in Niagara and replace with one. A new plan proposes to close 2 entire hospitals in Hamilton and replace with one, and potentially reduce the services in Grimsby – where the hospital is already running at more than 100 percent capacity all the time. In Windsor they are planning to close all the hospitals and consolidate them into one.
These are mergers upon mergers, service consolidations on top of service consolidations. All the hospitals involved have already been merged once in the previous round of restructuring. Always, in these plans, the new hospital is a giant P3, privatelyfinanced at an extremely high price. The new hospitals generally have fewer beds than the hospitals they replace. The irony of this plan is that the public is being asked to pay billions to downsize, close and privatize their local hospitals.
The costs of hospital restructuring of this sort are extraordinary. Inexplicably, the Ministry of Health does not track restructuring costs, not even those ordered by the Minister. The current policy is that hospitals have to pay for the restructuring out of their operating budgets. The reality is that hospitals in dire working capital positions are required to fund tens of millions of dollars to pay for mergers. In the Scarborough – Durham merger alone, costs are almost $50 million. Millions are allocated to advertising and PR to sell the merger to the public. Further millions are allotted to new “merger management teams” in each of the hospitals. Sadly, millions are planned to lay off staff and cut services. The rest is allocated to merging telephone, email and information systems.
It should go without saying that this kind of use of $50 million in public funds runs completely against public priorities and values.
To put the $50 million for this single hospital merger into context, in 2013, the Scarborough Hospital was forced to cut $17 million due to funding shortfall from the Ontario government. That cut amounted to a loss of more than 200 full-time nurses, health professionals and patient support staff; closures of outpatient clinics; closure of 2 operating rooms, closure of 20 surgical beds and cuts across 22 departments – virtually every department of the hospital. Imagine what a cut of $50 million to the operational budgets of local hospitals would mean.
In the last major round of hospital restructuring, the government did actually track and fund restructuring costs. In 1999 and 2001, the reports of the Provincial Auditor revealed the costs of hospital restructuring under the Harris government. While estimated costs for hospital restructuring under the Health Services Restructuring Commission (HSRC) were originally set at $2.1 billion. The auditor revealed that costs had reached $3.9 billion; an increase of $1.8 billion over expectations. In total, over the four-year period between 1997-98 and 2000-01, the province spent $1.9 billion dollars on costs associated with hospital closures.
Many Ontarians lived through the last round of restructuring and know clearly what the consequences have been. We saw our local hospitals cut. Dozens were closed entirely. We saw continual erosion of local services in smaller towns and increasingly overcrowded hospitals in larger towns. Patients, many of them elderly, all of them sick, are forced to drive from town-to-town to access care. This is neither in keeping with the values and priorities of Ontarians, nor is there any evidence that it is cheaper. Indeed, the increasing body of international literature in the field suggests that mergers cost more and reduce quality of care, particularly mergers of the size that are being contemplated in our province today. In Ontario’s history, the evidence shows that the costs of restructuring have never been recouped, and local services have continued to be dangerously eroded.
For most communities, a new hospital will be built only once in almost a hundred years. For most communities, people have been fundraising, donating and volunteering in an effort to bring services closer to home, for almost a century or longer. It is imperative that a real democratic process be created so that the people of Ontario – who fund our public hospitals and rely on them from birth to death – have meaningful input on the future of our vital local hospital services before more communities lose services that it took generations to build.
Our Comment
That annual reports of this nature have “for the better part of a decade” simply met with more of the same, supports the charge that “underfunding is planned and purposeful.”
The term “restructuring” is clearly defined in the course of this testimony. It is an excellent example of Orwellianesque “cheatspeak.”
The failure of successive Canadian governments to maintain “financial stabilityand reasonable and safe levels of service in public hospitals” indicates, at best, incompetence and, worst criminal negligence.
The decline of the public health care service, of course, strengthens the case of those who clamour for private health care.
The grand plan for a public infrastructure bank further suggests that underfunding could be a deliberate policy to promote privatization.
The use of “public funds to thwart public priorities and values” is an infamous betrayal.
While such information may not have moved governments, “for the better part of a decade,” to protect and promote our public health care service, the facts presented here should be enough to galvanize most of the rest of us into whatever action it may take to recover what we know is our right and what we know we can afford.
Anything physically possible and socially desirable can be made financially possible.
Élan
