There is some good news and bad news for Sault Area Hospital’s financial situation.
The bad news is that SAH is facing a big deficit for its 2024-25 fiscal year.
The good news is it won't be over $20 million as originally anticipated.
"While SAH is still forecasting a significant deficit for F2024/25, it is now anticipated the deficit will no longer be in excess of $20M,” wrote Ila Watson, SAH president and CEO, in a report prepared for the hospital’s board of directors at its most recent meeting held Monday.
The news comes after SAH updated its forecast for the 2024-25 fiscal year after the end of its second quarter in September.
SAH’s fiscal year runs from April 1 to March 31 each year.
“We have received some additional funding news that will contribute to an improved position, however specifics cannot be shared at this time as the information is under a public communications embargo. Year end forecasts will continue to be refined as information becomes available,” Watson reported.
SAH finished its 2023-24 year with a $2.1-million surplus.
That was unexpected due to a late-year provincial government funding adjustment for Bill 124 compensation.
“Without that support, we would have faced a significant deficit of around $7.5 million,” wrote Brandy Sharp Young, SAH spokesperson, in an email to SooToday.
Bill 124 compensation stems from Ford government legislation passed in 2019 that 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. However, the bill was overturned when the law was found unconstitutional in 2023.
The province’s hospital workers are getting additional wage increases over two years as a result and the government has been helping hospitals with Bill 124 compensation.
The originally-anticipated $20 million shortfall for 2024-25 came as the SAH board of directors approved the hospital’s 2024-25 operating plan that commits the hospital to maintain all its existing services.
“SAH is not alone in its challenges. Last year the majority of hospitals across northeastern Ontario had operating deficits and most face significant ongoing financial challenges. Without financial relief, hospitals will continue to face difficult choices,” Sharp Young wrote.
While details of additional funding that SAH will receive for 2024-25 remain under a public communications embargo, the hospital’s board and management continue to call for preservation of SAH’s programs and services.
“Together with our northeastern hospital partners, we continue to raise our concerns about the urgent need for support and intervention to ensure that health-care facilities can effectively meet the needs of their communities; these issues continue to be highlighted to our government leaders,” Sharp Young wrote.