April 17, 2024

President, CEO Ila Watson also points to dearth of funding details for dismal prediction

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Swelling pressure on primary health-care services will force at least one future Sault Area Hospital fiscal blueprint into the red.

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The region’s principal health-care facility is already forecasting a deficit for Fiscal 2024/25, albeit how deep is anyone’s guess due to so many funding unknowns, says SAH’s CEO and president.

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“While it isn’t unusual that we wouldn’t have all of our funding information at this point, what does make it unusual (are) the significances in the change of our operating expenses,” Ila Watson told the open portion of the hospital’s board of directors meeting Monday evening. “We’re about to start a new fiscal, and we need to commit to an operating plan even in the absence of all of the financial information.”

Watson and senior management have recommended to the Resources Committee that SAH’s operating plan for 2024/25 maintains “existing operations.” The hospital also anticipates that it will “need” to incur additional costs related to heightened demand for hospital services.

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“Particularly in the emergency department as a result of the community situation and the deteriorating ability to access primary care services,” Watson said. “The challenge is that we know maintaining services now costs considerably more in the coming year than (it) did this year.”

The “community situation” to which Watson referred involves, principally, recent news that some 10,000 patients will lose access to their primary care provider and same-day clinic services through Sault Ste. Marie’s Group Health Centre (GHC) as of May 31.

GHC officials say this significant loss of health-care access is due to a provincial and nation-wide shortage of primary care providers, which has left GHC “unable to find replacements for providers who have closed their practices over the last several years.”

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The centre has identified an additional 6,000 patients at risk of losing primary care in the near future if such trends continue. GHC will have some 50,000 rostered patients following May 31. It’s estimated there are now some 30,000 people in the area without a primary care provider.

Watson acknowledged earlier the glut of orphaned patients will have a “significant” impact on Sault Area Hospital’s emergency department, overall operations and wait times – not to mention those patients affected and the entire community. She said that like other Ontario hospitals, SAH is already facing challenges in terms of growing patient volumes, high acuity and staffing issues, and the addition of 10,000 patients without primary care will contribute to the hospital’s already existing challenges.

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“We know that our community will increasingly rely on our hospital for care they should be able to access elsewhere,” she told The Sault Star at the time.

Significantly more orphaned patients will also “directly translate to a significant increase” in calls for paramedic service and increased off-load delays experienced at Sault Area Hospital, which will ultimately impact ability to respond to emergencies, District of Sault Ste. Marie Social Services Administration Board says.

Without access to same-day care, or a primary care provider, patients look to emergency rooms and 911 to access medical care.

“We anticipate that this will have a significant effect on our operations, and has the potential to increase hospital off-load delays,” DSSMSSAB chair Stephanie Hopkins said earlier.

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In 2023, ambulances spent an average of 5,024 hours waiting to offload patients, with the average time being 30 minutes to offload one patient. Patients who go “time and time again” to either an urgent care or emergency room without having access to primary care will ultimately impact emergent community health-care needs, said Hopkins.

Sault Ste. Marie MPP Ross Romano said recently he’s “cautiously optimistic” that a plan will be in place before May 31 that will ensure the 10,000 derostered patients will have access to primary care services.

Romano has launched a task force, its first meeting held March 1, to review a vision and mission statement and develop a plan of attack to determine the root causes of the physician shortage issues and develop short and long-term solutions. Romano said the first goal is to ensure that derostered GHC patients will have access to primary care services through alternatives that are currently being explored. No further details have emerged.

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Unlike the previous year, when SAH registered a $4.6-million surplus, it rang in an overall deficit of $1.3 million for the year ending March 31, 2023. Financial results included additional payroll accruals related to negotiated contracts from which payment was not made at March 31, and estimates for contracts which had yet to be negotiated.

During the height of the pandemic, hospitals, including SAH, were “well supported” with funding to address new risks, yet the impacts of overturning Bill 124 and “significant” inflationary increases created “uncertainly,” and are reasons for SAH ending the year in a deficit position, the hospital said. The previous year’s surplus was driven primarily by unexpected one-time funding received late in the fiscal year, the “ability” to share expenses with other northeastern hospitals and the “correction” of a previously recorded transaction.

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Proper planning from all parties is imperative to tackle the current quandary, Watson said.

“As management, we really need to have direction from the board on our operating plan for 24/25 as we begin to commence that new year,” she added.

“And we will, of course, need to deliberate further with the board on this.”

On a brighter and unexpected note, despite the fact SAH has been reporting that it expected to be in a deficit position at the end of 2023/24 – the fiscal year wraps March 31 – with main contributors being inflation, compensation increases that are “appropriately implied” following the overturning of Bill 124 and disruptions to the supply chain, it appears the period will wind up in the black.

Watson said although she couldn’t share all details as “some of the information is still confidential,” based on recent funding letters SAH has received, including reimbursement for retroactive compensation increases, the hospital now anticipates ending this year in a surplus position.

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SAH reported as recently as December compensation expenses accounted for more than 60 per cent of the facility’s expenses each year, putting “significant pressure” on this year’s budget.

“When we look at forecasting where we’ll end up by the end of the year and into the next budget year, there is a significant amount of uncertainty related to funding,” Resources Committee chair Armand Capisciolto said.

The overturning of Bill 124, Protecting a Sustainable Public Sector for Future Generations Act, has “significantly” increased costs this fiscal year and into the future.

Bill 124, ushered in by the province in 2019, capped wages on public-sector employees, including many health-care workers. It restricted wage increases to a maximum of one per cent for three years and effectively limited the bargaining process for unionized employees.

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However, with the bill being overturned in the spring of 2023, Ontario hospital workers are getting additional wage increases over two years, the latest in a series of similar arbitration decisions after the province’s wage-restraint law was found unconstitutional. An arbitrator awarded 3.75 per cent and 2.5 per cent for last year and this year to hospital workers, such as dietary aides, personal support workers and registered practical nurses, on top of the one per cent per year they received under Bill 124.

The province’s top court ruled recently that the law violated collective bargaining rights, largely upholding a lower court ruling. The province soon afterward announced that it would repeal the law in its entirety.

With files from The Canadian Press

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On X: @JeffreyOugler

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