Saskatoon Health Region approves budget, faces $30M deficit

The CEO of the Saskatoon Health Region warned more tough decisions will be made as the organization tries to reign in its deficit.

Dan Florizone said getting the region’s books in order is the most challenging financial situation he’s ever faced working in health care.

The health region posted a year-end deficit of $35.7 million and is on track for a $31.8-million shortfall in the current fiscal year. The deficit is lower than what was originally projected. 

“As a not-for-profit, publicly-funded organization, our target is a balanced operating budget,” Florizone said in a news release Wednesday.

“But we know that it will be extremely challenging to achieve this by the end of March as we continue to experience volume and demographic pressures. We have tough decisions to make in the weeks ahead as we continue to work to close the gap between revenues and expenses.”

The health region approved its 2016-17 operating budget and capital plan this week.

In July, the region announced additional work expected to result in more than $34 million in annual savings after initiatives are all fully implemented.

Those included a two-month temporary in-scope hiring freeze and a voluntary separation package for out-of-scope staff. The voluntary separation program received nearly 40 applications, all of which are now being reviewed.

In addition to the sustainability initiatives, the region’s $1.2 billion operating budget includes the following allocations from the Ministry of Health:

• $12.4 million in incremental funding to cover wage increases agreed to through provincial collective bargaining and the Saskatchewan Medical Association
• $11.8 million in incremental inflation funding

Saskatoon Regional Health Authority also approved the region’s capital plan including allocation of the Ministry of Health’s $23.9 million in capital funding to the following needed areas:

• $8 million for Royal University Hospital’s heating and cooling systems in support of Children’s Hospital of Saskatchewan infrastructure needs
• $3.65 million for capital equipment
• $12.3 million in infrastructure improvements to be directed towards items such as nurse call system replacements in long term care, elevator replacements and roof repairs.​