Hospital funding in Ontario
St. Joseph’s receives provincial funding through the South West Local Health Integration Network. St. Joseph's Health Care London receives funding from the Southwest Local Health Integration Network. The opinions expressed in this publication do not necessarily represent the views of Southwest Local Health Integration Network.
Hospital Service Accountability Agreements (H-SAA)
Every year Ontario's 14 Local Health Integration Networks (LHINs) negotiate service accountability agreements with the health service providers they fund. St. Joseph’s Health Care London negotiates its H-SAA with the South West LHIN.
Health System Funding Reform (HSFR)
The new HSFR funding method moves away from the traditional method of hospital funding (global funding) to two new patient-based funding categories:
- The Health-Based Allocation Model (HBAM) allocates funding to hospitals based on factors such as the demographic and clinical characteristics of the people they serve.
- With Quality-Based Procedures (QBP) hospitals must provide procedures within price points set by the Ministry. For example, in 2012/13 QBPs applied to cataract surgery and inpatient hip and knee replacement rehabilitation, and in 2013/14 they were expanded to include endoscopy.
Accountability - Broader Public Sector Accountability Act (BPSAA)
Introduced in 2010, the BPSAA sets out rules and accountability standards for key business practices at hospitals and other broader public sector organizations.
Capital versus operating funding
Operating funding supports ongoing hospital expenditures such as salaries, benefits, drugs and supply costs as well as the cost of replacing capital equipment. Operating funding cannot be used for major capital renovation projects or new buildings. In turn, capital funding cannot be used to support operations.
If the hospital has an operating surplus, the Board of Directors may choose to save or restrict these one-time funds for specific purposes, including one-time investments in capital equipment and facilities.
New buildings are never fully funded by taxpayer dollars and rely on a combination of hospital investment, donor support and government investment.