Mar. 30, 2016
London, Ontario – The St. Joseph’s Health Care London (St. Joseph’s) Board of Directors has approved a budget plan for the 2016/17 fiscal year to address an almost $17 million gap in operations on a total annual operating budget of $424 million. The budget gap is due to unfunded increases in inflation coupled with changing provincial funding models.
The budget plan has been submitted to the South West Local Health Integration Network. In the plan, St. Joseph’s has submitted a $5.9 million deficit and will be moving forward with several strategies to address the gap including: carrying the deficit while ongoing advocacy continues with the LHIN and Ministry of Health; increased revenue from post construction operating plans and other revenue generation; finding efficiencies by benchmarking our operations to peer organizations and other budget savings strategies.
In the past four years, due to lack of funding increases and Health System Funding Reform (HSFR), St. Joseph's has experienced an overall reduction of $8.5M. In addition to zero funding increases, St. Joseph’s has had to find creative strategies to balance expense inflation of approximately $7M each year. These pressures amount to a $36.5 million reduction of St. Joseph’s total budget in the past four years.
“Faced with a $17 million gap, St. Joseph’s needed to make some difficult decisions,” says Dr. Gillian Kernaghan, President and CEO of St. Joseph’s. “We are once again in a position of reduction and needed to look at cost saving strategies across the whole organization. The reductions will result in some changes to care delivery and some job loss.”
Changes in how care is provided and resulting human resource impacts the care changes necessary to bridge the gap impact several programs across St. Joseph’s including mental health care and transitional care at Parkwood Institute.
The changes in mental health care come after the completion of extensive benchmarking reviews using peer comparators; and the budget saving strategies were spread across the mental health care program.
“We knew once we settled into regular operations, after opening our two mental health care buildings, some adjusting would be needed,” says Dr. Kernaghan. “We will be more closely aligned with how care is delivered across the province in other mental health care facilities.”
Parkwood Institute will also see some change in transitional care. The Transitional Care Unit (TCU) at Parkwood Institute is for those who have finished acute level treatment for an injury or illness, are not ready to go home, and who would benefit from restorative (or lower intensity rehabilitative) care. “St. Joseph’s in partnership with LHSC have been funding these beds out of reserves since South West LHIN funding ended in 2011,” states Dr. Kernaghan. “We can no longer fund this program due to financial restraints.” In October 2016, St. Joseph’s will be removing 12 temporarily funded transitional care beds and transferring three beds to the Complex Care Program at Parkwood Institute while working on creating capacity in our funded complex care beds to serve the type of patients currently seen in the TCU.
Additional cost savings were attained from departments across St. Joseph’s through the reduction of supplies budgets and some positions. In total, St. Joseph’s will see a reduction of 60 positions, 49 full-time, seven part-time and four casual. “Thanks to ongoing work with unions and staff, through mitigation and attrition 12 out of the 60 positions will result in actual layoff, and there will be further opportunity for mitigation during the layoff notice period.” St. Joseph’s will also be adding eight new personal care partner positions.
“It’s never easy. Changes like this can be very difficult for the individuals, our organization and the community,” says Dr. Kernaghan. “But we know in order to meet our targets and live within our budget constraints we needed to make tough choices. Maintaining quality care and safety was a core principle of our budget saving strategies as we worked to minimize impacts to St. Joseph’s, our staff and the people we care for.”
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For more information:
Communication and Public Affairs
St. Joseph’s Health Care London
519 646-6100 ext. 47155