TORONTO - Dire predictions that half of Ontario's hospitals are facing illegal deficits were dismissed by the province Thursday as a pre-budget plea for cash, but Heath Minister George Smitherman wouldn't rule out cuts at cash-strapped hospitals as they scramble to avoid the red ink.
"What is a cut?'' Smitherman said after announcing a $100-million plan to add a new prescription drug to the province's publicly funded list.
"If a hospital alters its administration and some people are exited from that environment, is that a cut? No, I don't think so.''
The Ontario Hospital Association is warning that 75 of the province's 154 public hospitals are facing a deficit for the fiscal year starting April 1, increasing to 104 the following year.
The results of the March 5 survey, released Monday to hospital executives and boards, comes just two weeks before the province tables its budget March 25.
Service cuts are reportedly in the works at some hospitals because provincial law prohibits them from running deficits.
But Smitherman pointed out that such doom-and-gloom predictions are common around budget time, when many groups are competing for more cash.
It seems to have become an annual power struggle between the province and its hospitals, as both sides battle over resources that are already stretched thin.
In 2005, Premier Dalton McGuinty inked a three-year, $1.75-billion deal to help eliminate deficits projected by 89 of Ontario's 154 hospitals.
But Smitherman suggested Thursday he'd be reluctant to bail out hospitals that are unable to balance their books, saying the province already spends about $15 billion a year on hospitals.
It also hands out additional funding each year, with a 2.4 per cent increase slated for the coming year and 2.1 per cent next year, he said.
"I wouldn't be announcing the budget today,'' Smitherman said.
"But let's just say that in every year, there are these dire predictions made about hospitals being in deficit circumstances and usually, that storyline doesn't carry through the year.''
The OHA said those funding increases aren't enough to cover rising wage and energy costs, not to mention higher demands from an aging population -- an opinion echoed by opposition parties.
"They've eliminated all the low-hanging fruit,'' said Conservative health critic Elizabeth Witmer.
"They're now at a point where, if they're going to balance their budget, they need to take action like cut beds, cut staff, reduce operating room time.''
Hospitals need a stable base of funds rather than one-time investments that don't stretch from year to year, she added.
"This year, they've simply hit the wall,'' Witmer said. "The inflationary pressures are simply too great and they simply don't have the financial resources.''
Hospitals aren't the only facilities facing a financial crunch, said NDP critic France Gelinas.
When hospital beds are cut to balance the books, that increases the pressure on other services like nursing homes and home care, which are also underfunded, she said.
"We have good hospitals in Ontario that are working really hard at staying within the financial parameters that have been given to them,'' she said.
"But when everything else around them is falling apart -- the home-care system, long-term care beds (that) are not there -- they end up with the bill.''
