Funding freeze undermines Ontario’s healthcare

In November, Ontario Finance Minister Dwight Duncan spoke to a gathering of hospital trustees about the largest tax cut in the province’s history.

Corporate tax cuts are expected to take $5 billion out of the system, while personal tax cuts will account for another $11 billion. By contrast, the total spending for all public health care – including family doctors, drug programs, home care, nursing home care, cancer care, community health centres, ambulance and hospitals – increased by about $2 billion last year, $800 million of that coming from increased transfers from the federal government.

Despite increased federal transfers for health, this past summer hospitals were advised by the Ministry of Health to do their planning based on funding they received this year – a freeze.

This message was echoed by the Local Health Integration Networks (LHINs), which asked for scenarios based on zero, one and two per cent. Some suggested a freeze might extend to two years.

Hospital costs go up by about four per cent per year, including competitive salaries for scarce health professionals, increases in demand from an aging and growing population, fast-rising drug and equipment costs and the need to meet provincial targets on wait times. There’s one other cost hospitals are facing – dramatically increased demand for reporting by the Ministry of Health and the LHINs.

Despite this, public health spending as a proportion of the provincial economy is about the same as it was in the last recession – about 7 per cent of GDP. We also can’t forget these costs include considerable add-ons to the system, such as Family Health Teams and Community Health Centres. Healthcare takes up a greater portion of the provincial budget not because of runaway costs, but because government itself has been shrinking. Critics say health will be more than 50 per cent of the provincial budget by 2015 – with huge tax cuts on the horizon, they may be right, even if there is no increase in health care funding.

This year the LHINs reported 38 per cent of hospitals finished the last fiscal year running operating deficits even with extreme pressure to balance budgets. If not for significant service and bed cuts, that number would likely be higher. Cuts have left many Ontarians at risk through unacceptable waits and greater distances to access care. Patients who emerged from hip and knee surgery in some locations found that they had to pay out of pocket for physiotherapy after their hospital was forced to close access to outpatient physiotherapy. Others found specific lab tests were no longer paid for when the hospital outpatient labs closed.

While hospitals appear targeted to pay for the poor spending decisions of the McGuinty government, they are hardly to blame for the e-Health scandal, the excessive costs of privatizing lab testing, the exorbitant salaries of senior bureaucrats the province hides within their budgets, or the boondoggle of capital infrastructure privatization imposed upon them. According to Ontario’s auditor, Brampton’s William Osler Healthcare cost taxpayers nearly half a billion more under a private financing and development scheme than the public alternative. There are in excess of 30 more such projects in the works.

You can do something.

About 30,000 healthcare workers represented by the Ontario Public Service Employees Union are asking the public to stand up for their hospitals and their public healthcare. OPSEU has set up a web site where Ontarians can organize and send their own customized e-letter to their local MPP, the health minister, the premier, and the opposition health critics. You can spend as little time, or as long as you like expressing your opinion.

We need to put our scarce resources into front line care – not into more private consultants and well-placed friends of the government.

Click on to participate.