Defend Public Healthcare

Will Ontario hospitals get a 4% funding increase?

2026-03-31T19:13:00.018-04:00

Health sector expense for 2025/26 is projected to be $5.658 billion higher than as reported in the government's Third Quarter Finances. Up to the 3^rd Quarter Finances there had been about a billion dollar increase over the health sector Budget plan (with a $664 million budget increase for hospitals and the rest for home care). So, in total, the health sector budget got an additional $6.7 billion added to it since the 2025/26 Budget plan. This is a significant increase (equal to 2.6% of all program spending for all ministries) that came right at the end of the fiscal year. It shows the Ministry of Finance's Budget planning is way, way off.

The health sector budget (for the Ministry of Health and the Ministry of Long-Term Care) for 2025/26 is now $97.8 billion. In the 2025/26 Budget it was set at $91.1 billion. So, the total planned increase over the Budget projection is 7.35%.

Health sector 2024/25 expenditures were $91.3 billion. So, the planned increase over 2024/25 is 7.1%. The government planned harsh austerity for health care and ended up increasing the budget plan sharply.

Being off by this much is not a new phenomenon. The government’s Budgets remain highly unreliable.

The unreliability of the Budget is even more clear when funding for the Ministry of Health (MOH) is looked at alone (excluding funding for the Ministry of Long-Term Care). MOH funding is now planned to be $89.025 B in 2025/26 rather than the $81.85 billion set out in the 2025/26 Budget. So, the government's current plan is to overspend their Budget plan by 8.8% -- or $7.17 billion. The budgeted increase compared to the 2024/25 actual spend is 8.95% or $7.3 billion.

The plan for 2026/27 is to increase Ministry of Health funding to $91.9 billion – a 3.1% increase. Based on past experience, that is just the starting point. Reality (assisted by campaigns pointing out reality by community groups, health care providers, and unions) will push that higher.

Will the government spend the end of the year $5.7 billion bump to the health sector budget? It is not exactly clear from the Budget which health care providers are getting what in 2025/26 – an extra $5.7 billion is a lot to spread around at the very end of the fiscal year and the Budget lacks details on where this $5.7 billion is supposed to go.

It's quite possible that the government will not spend all the budgeted amounts-- and providers like hospitals will be left with deficits and negative working capital. The sharp hospital cuts and layoffs going on now indicate that this money is needed.

Ministry of Long Term Care: MLTC interim funding saw a 4.8% increase in 2025/26 over 2024/25 actuals, increasing funding to $9.28 billion, exactly as planned in the 2025/26 Budget. So, there is no in year improvement for MLTC. Indeed, they may come in under budget -when the final figures come in when the Public Accounts come out in the fall.

The plan is to increase MLTC funding by 6.3% in 2026/27 (i.e., by $556 million). That's significant but it's not clear what is going on here. Perhaps they believe they will (finally) add a significant number of new beds.

There is no sign of funding for an improvement in service level. For Long-Term Care services the government promises only to keep direct care at 4 hours per resident per day and 36 minutes per resident per day for allied health workers. Nothing new or improved.

The Budget claims that 4,054 new LTC beds have been added. This implies that 1,483 beds were added this past year (4054 - 2571 reported last year =1483). That is significantly more beds than they have added in past years. They added only 2,571 beds between June 2018 and April 2025. But still this means that at the current rate of expansion, they won’t get to 30,000 additional beds for another 17.5 years (i.e., 2043). They promised to do this by 2028.

Medium Term Outlook: It’s not just 2025/26 that has seen a budget funding improvement. The medium-term expense outlook has improved significantly for the health sector. In the 2025/26 Budget the 3-year plan was for an average of 0.7% annual increases. That was improved to 1% in the Fall Economic Statement. Those plans were ludicrously low.

Now they have (slightly) come to their senses and are looking at a 3.47% increase over the interim 2025/26 figure of $97.8, bringing the total to $101.2 billion for 2026/27. For 2027/8 they project a 2.3% increase, and for 2028/29 they project a 3.1% increase. So, the government has improved its medium term projections - -but it is still far, far short of need, given aging, population growth, inflation and people getting chronic illnesses at younger ages and living longer with chronic illnesses.

Deficit lower than planned: And as has happened in the past, despite funding increases, the deficit came in under the Budget plan – by $2.3 billion.

This may well prove to be an understatement – they may not spend everything they now have in their 2025/26 budget plan (it takes a while for the money to flow so 2025/26 spending won’t finalize at the year-end on March 31) and they still have $600 M in reserves and their contingency fund. These will come off the deficit if they are not spent.

Will hospitals get a portion of the extra $5.7 billion in funding for 2025/26? For 2025/26, hospital operations line-item funding was budgeted at $27.090 B. In the third quarter an additional $664 million was budgeted for hospitals, bringing the total to $27.754 B. This squares with the Toronto Star’s report that funding was increased in the Budget by $1.1 billion (4%) to $28.9 B ($27.754 B + $1.1 B = $28.854 B). But note - - this does not include any portion of the last minute $5.7 billion health care top up for 2025/26.

So, if the hospitals do get a share of the extra $5.7 B that was provided for the health 2025/26 budget, it is a little hidden – or at least not included in the $28.9 billion reported by the Star.

The Budget is very coy and only says this significant end of the year increase is “primarily to address pressures related to the delivery of health care and to address growing demand for other health services, such as utilization-driven programs like the Ontario Health Insurance Plan and Ontario Public Drug Programs.”

Four percent funding increase for hospitals? The government claims that it will increase hospital funding by 4%. But will it?

Hospitals have big deficits and a shortage of working capital so it would make sense that they get some of the $5.7 billion in last minute cash for 2025/26.

If, say, $800 million of hospital deficits are paid off via the extra $5.7 B budget health increase for 2025/26, then 2025/26 funding will be increased by $800 million and a 4% funding increase would have to build on top of that -- i.e., $27.8 billion plus $800 million plus 4% -- or $29.74 billion -- and that is $840 million more than the $28.9 billion reported by the Star.

Bottom line: Where the extra $5.7 billion for 2025/26 is going remains unclear. All we know for sure is that it is not going to LTC – and that drugs, doctors, and some unnamed health care providers are budgeted to get some, unknown amounts of last minute cash for 2025/26. In all likelihood no one will find out how much until 2025/26 is nothing but a fading memory. (It's a funny way to run a health care system.)

It is also notable that there were zero new promises made for the additional $5.7 billion in health funding announced in last weeks Budget. The government is simply admitting, at the last moment, the true cost of health care for 2025/26. This may provide some relief for some health care providers but will not lead to improved services-- the year will be over before any of the providers receive the money.

The only slightly improved medium-term forecast for health care funding means that the charade of low-balling health care budget expenses in the Budget will continue for another year- -although perhaps not quite at such an outrageous level.

Ontario Budgets are highly misleading

2026-03-18T12:21:00.004-04:00

In the lead up to the Ontario provincial Budget, it's useful to flag just how unreliable they have become as a guide to public spending and provincial deficits in recent years under the Ford government.

The government has shown a significant ability to increase funding for public programs and health care programs if the public demands it. The Public Accounts report that total provincial government program expenses for 2024-25 increased by $16.9 billion or 8.7 per cent over the previous fiscal year. That is an increase from $195.2 billion in the previous fiscal year to $212.1 billion in 2024/25.

Furthermore, the actual 2024/25 spend was $11.5 billion more than the 2024/25 Budget plan. The Budget was a very unreliable indicator of actual program spending.

A similar scenario played out in health sector funding. It increased by $6.2 billion or 7.2 per cent over the previous fiscal year.

The total health sector spend was also $6.7 billion more than the Budget plan. In other words, the government planned to cut health care funding by half a billion dollars in 2024/25 but ended up increasing it by 7.2%. Again, the Budget plan was a very unreliable indicator of actual spending on health care as reported in the audited public accounts.

According to the Public Accounts, key health sector increases included:

$1.0 billion in higher spending by hospitals “driven by program growth, the expansion of service delivery capacity, and increased demand for services”
$0.8 billion in additional funding for hospitals “to respond to Ontario’s aging and growing population”

Over the years, the current PC government has consistently altered Budget plans to increase hospital funding.

So far in this fiscal year (2025/26), the province has added about another billion to the Ministry of Health budget plan -- for home care and hospital care. It's possible more may be added for 2025/26 in the 2026/27 Budget.
The Financial Accountability Office (FAO) notes that in the 3^rd and 4^th quarters of 2024/25 there was a “$1,781 million increase for Health Services (Vote-Item 1416-1), including $1,009 million for the Operation of Hospitals, $257 million for Home Care and $122 million for Community Support Services.”
Similarly, the FAO notes that in 2023/24 fourth quarter there was a “$2,598 million increase for Health Services (Vote-Item 1416-1), largely for the Operation of Hospitals. The spending plan increase is partially due to compensation for the impact of wage restraint under Bill 124, the Protecting a Sustainable Public Sector for Future Generations Act, 2019. A portion of the spending related to Bill 124 will not have a fiscal impact in 2023-24 because it was already recorded as a liability in 2022-23.”
Similarly, in 2022/23 they increased hospital operating funding plans by $258 million mid-year.
In 2021/22, the hospital operating funding plan increased $3 billion in the fourth quarter.

Hospital funding plans can and do change, often late in the fiscal year.

According to the Public Accounts, health sector expense “increased from $69.5 billion in 2020–21 to $91.6 billion in 2024–25, or on average by 7.2 per cent per year” (our emphasis). Funding for the health sector has grown rapidly – but often the increases were achieved not via the Budget plan but by changes made during the fiscal year. The real budget is not set at the time of the provincial Budget but much later in the fiscal year. Unions, health care providers, and communities have to fight for the funding throughout the year.

These in-year increases occurred, even while deficits consistently came in well under the Budget forecast: There is quite a contrast between forecasted budget deficits and actual deficits in recent years. The 2021/22 Budget forecast a $33.1 billion deficit. The Ontario government finished with a $2 billion surplus! The 2022/23 Budget forecast a $19.9 billion deficit, but they finished with a $5.9 billion deficit. In the 2023/24 Budget, they forecast a $1.3 billion deficit but came in at a $647 M deficit. In 2024/25 they forecast a $9.8 B deficit but finished with a $1.1 billion deficit.

In total, the government came in over $58 billion better than they forecast over those four years – in another words an average of $14.5 B better than forecast.

This was usually achieved even with much higher spending than forecast, e.g. in 2024/25 the PC government forecast $200.6 billion in program spending but spent $212.1 billion; in 2023/24 they forecast $190.6 billion in program expense but spent $195.2 billion; in 2022/3 they forecast $185.2 billion but spent $186.4 billion.

Things are not nearly as bad as the Budget usually claims. With fightbacks from unions, local communities, and by health care providers there usually is significantly more spending than the Budget sets out and this occurs simultaneously with much smaller deficits than projected in the Budget.

The fight for improved health care funding, before provincial Budgets and throughout the year, is vital. Ontario remains far behind other provinces in health care and hospital funding and so, for example, needs 48,000 more full time staff just to meet the staffing levels of the other provinces. We need additional funding to offset health care inflation (which is considerable), population aging, population growth, increased utilization, people getting sick at a younger age and people living longer with chronic conditions.

Campaigns have won additional health care funding in recent years, despite fierce resistance from the Ford government. But there is a lot more to do.

The hospital crisis: No capacity, no plan, no end

2023-12-04T08:00:00.127-05:00

While Canada has achieved universal public healthcare coverage, that does not mean conservative forces have given up trying to erode that coverage and expand corporate care where it does not currently exist. The battle has become particularly intense in Ontario under the Ford Progressive Conservative government, which is implementing serious cuts to the level of care and moving to bring in for-profit mini-hospitals.

Inadequate Staﬃng. Less and less of hospital spending is on staff. Employee compensation as a share of hospital expenditures has consistently shrunk in Ontario.

This is not some immutable law of hospital development. It is in stark contrast with the rest of Canada, where compensation has become a larger share and now accounts for 67.1%.

Hospitals in provinces other than Ontario now have 18 percent more staﬀ per capita than hospitals in Ontario.

Overall, if Ontario had the same staﬃng capacity as the other provinces and territories, there would be another 33,778 full time staﬀ working in Ontario hospitals. The largest part of the staﬀ deﬁcit for Ontario is in nursing and inpatient services – Ontario has 0.285 FTE workers per 100 population in inpatient services versus 0.395 in other provinces across Canada – fully 38.7 percent more. Ontario is short 16,245 full time inpatient and nursing staff.

The overall staffing deficit is despite the fact that Ontario hospitals have above average staffing in research and education (as befits a rich and large province) and also in primary care.

Staﬃng levels are not improving: Statistics Canada data on health care employment suggests that there has not been a real staﬃng improvement over this government’s tenure, despite the COVID crisis.

All three health care subsectors are down from previous highs in employment.

In hospitals, employment has increased by 3,210 since the onset of COVID in the ﬁrst quarter of 2020. That is an increase of 1.2%, or 0.4% per year, a shockingly small increase considering the burden COVID and long-COVID have placed on health care. Even now, after four years of COVID, over 1,500 people are in Ontario hospitals with COVID infections -- These patients occupy over 4% of hospital beds. Patients with COVID cost three times as much as other patients and stay almost three times as long (20 days). But COVID aside, the need for hospital care due to population growth and aging has expanded at a much faster rate, as we shall see.

The shortage of hospital workers: With deteriorating working conditions, hospital job vacancies have grown dramatically. There are over three times the number of hospital job vacancies in the ﬁrst quarter of 2023 than in 2015.

Over the last year reported, hospital job vacancies increased by 4,015, an increase of 19.3%. This has occurred even as job vacancies in the overall Ontario economy fell by 57,035 vacancies – or by 18%.

Consequences of the Staﬃng and Capacity Crisis: Most notably, emergency rooms have closed hundreds of times in 2022 and 2023. Unplanned closures of ERs is a new situation, almost never seen before.

In 2018, the Progressive Conservatives ran on a promise of ending hospital hallway healthcare. In fact, the problem has gotten worse. The number of inpatients being cared for in hallways has hit 1,289 per day an all-time high, 22% higher than when the government was elected in June 2018.

Setting aside the months in 2022 when there was a pause on elective surgeries (due to concerns over inadequate capacity during a COVID wave), the FAO reports that hospitals performed 4,523 fewer surgeries per month than in 2019. Annualized that would be a cut of 54,276 surgeries, 8.4 percent fewer than in 2019.

Surgical wait times in 2022 were 49 percent longer than 2019.

The FAO reports that 107,000 patients are waiting longer than the maximum clinical guidelines for their surgeries, an all-time high. The (unacceptably high) pre-pandemic level was 38,000. The FAO notes a reduction in the “long-waiters” list will not occur without additional measures.

The Government’s plan is inadequate: The government brags about 3,000 new hospital beds over the next decade. That’s about an 8.4% increase in nominal capacity, or 0.79% per year, roughly comparable to the very modest increase in staffing since COVID.

The government treats these nominal increases as if they are improving service levels. Measured against need, however, Ontario is facing a sharp decrease in service levels.

That nominal increase won’t come even close to covering oﬀ increasing demand for services due to population growth, which according to provincial government projections, will be about 15%. The demands on health care will be much more than this, however, due to a rapidly aging population.

Health care needs are very sensitive to age.

Source: FAO

People 65 years of age or older use most of our hospital bed days -- 59.5% hospital bed days in 2021/22.

The population of the 65+ age group is currently growing according to Ontario Ministry of Finance data by more than 3% a year, twice the rate of the overall population. We will have about a third more people aged 65+ in a decade. The total 65+ age group is projected to grow by 63 percent by 2046 (from 2.7 million to 4.4 million), but the 75+ group will increase 125%, and the 90+ age group will increase 213%. The very rapid growth of these latter two age groups will drive up demand even more quickly.

Government plans for the years immediately ahead are even worse. The FAO reports that only 1,000 new beds will be added in the next four years, less than a 3% increase. That four-year increase is enough for about two years of population growth, with nothing to oﬀset aging, much less improve service levels to deal with the capacity crisis.

The rapid growth in the number of elders is driving up the need for hospital beds (and the hospital workers to staﬀ them) by more than triple the planned increase in staﬀed beds.

Aging and population growth are long-term trends and should have been planned for decades ago. Instead, beds were cut sharply in the 1990s and then were left at the same level despite surging population growth and aging. This resulted in the current hospital capacity crisis.

The plan, however, is to double down on long-term cuts in hospital service levels.

Amid a hospital capacity crisis, the plan is to reduce hospital capacity relative to need.

Home care: The government trumpets new money for home care - -but (with aging and population growth) the FAO projects a decline in the number of nursing and personal support hours per Ontarian aged 65 and over, from 20.6 hours in 2019-20 to 19.4 hours in 2025-26. That is down 5.8% -- almost 1% per year. There is no relief planned through home care - - in fact just the opposite.

Long-Term Care: The FAO now sees a slight improvement in the ratio of long-term care bed to elders 75 years of age and over -- from 71.3 beds per 1,000 in 2019-20 to 72.1 in 2027-28. The increase amounts to a 1.1% increase over 8 years. That's an increase of 0.1% per year.

This tiny increase is the plan when almost 40,000 elders are on the LTC wait list and the government has just passed legislation to require hospital patients to move into long-term care more quickly.

Even with this very modest increase, we are still far short of the 90 beds per 1000 elders 75+ in 2010/11 -- 20% less. As with home care, there is no relief coming from the current plan for LTC development.

The Fake Solution: For-Profit Care: In 2022/23, hospital funding was cut by $156 million. For this year, budgeted funding for hospitals was $23,773,093,800, an increase of $115,458,800 or 0.488% over the 2022/23 Budget Estimates (of $23,657,635,000).

In contrast, so called “Independent Health Facilities” (i.e., private, for-proﬁt surgical and diagnostic facilities) are budgeted to get a 212% increase from last year’s Budget Estimates. As shown in the 2022/3 and 2023/4 Estimates, IHF budgeted funding increased from $38,693,100 to $120,693,100. That is an increase of exactly $82 million – or 211.92%. In dollar terms, they budgeted almost as much of an increase to the tiny IHF sector ($82 M) as they did for the entire public hospital system ($115.5 M). It is a boom for private proﬁts, even as the government implements harsh austerity for public hospitals.

While the government touts this privatization as a solution, this will, in fact, add little capacity. The increase budgeted (from $38.7 million to $120.7 million) sounds signiﬁcant, but with hospitals operating on $30 billion in provincial government and other funding, the private facilities are too small to add significant capacity in the short or medium term.

Yet this is where the government has chosen to focus its energies in the midst of a severe capacity crisis. This is, at best, an attempt at a diversion from the need to develop more capacity. True solutions lie elsewhere.

Health care capacity is in crisis now, service levels have declined and the plan is to reduce capacity further. This fits with the attacks on living standards via housing and inflation, reducing living standards now at a faster rate than we have seen for many decades. Capitalist rule is not delivering. Change is required.