North Wellington Health Care (NWHC) board chairman Patti-Jo McLellan Shaw, announced Sept .26 the board has signed two year hospital service accountability Agreements with the Waterloo-Wellington Local Health Integration Network.
The agreements are based on funding provided by the WWLHIN.
Under the Local Health System Integration Act, the 14 networks in Ontario were given the power to plan, integrate, and fund local health services – including hospitals. Hospitals are required to sign accountability agreements including balanced budgets with the local network.
The process includes planning with the network to help organizations address financial constraints and to ensure that the plan supports the integrated health service plan of the network.
McLellan Shaw said, “Both years result in operational deficits. In 2008-09 we will be balancing our budget using capital reserves (approximately $300,000). This is not a sustainable way of operating a business and along with physicians and the senior management team, our board is developing a plan to balance the budget for 2009-10. We will be looking at different service delivery models, enhanced partnerships and other ways to be more efficient. Our recovery plan must be submitted to the [network] by Dec. 31.”
Jerome Quenneville, President and Chief Executive Officer of North Wellington Health Care stated, “We have been working with consultants, physicians, staff and community partners over the last several months to determine the right mix of clinical services for our hospitals. We must operate within the funds received.”
He said, “This will require changes to the way we provide services and programs and this will impact our community. We have been told that there will be no new money from the [network]. There will be no incremental funding for increased volumes of service or growth.”
McLellan Shaw said that one of biggest challenges facing the organization is trying to manage with incremental funding increases of 2% when wages and benefit increases are 3%. Inflationary increases on drugs and medical and surgical supplies typically exceed 3% annually. The NWHC currently has an annual operating budget of $18-million.
McLellan Shaw said, “We face a significant challenge of limited financial resources to meet increasing health care needs of the community … We have some difficult decisions to make. Our board remains committed to addressing financial constraints in a responsible way that supports appropriate health care services delivery.”
