WRHA sharp­ens bud­get scalpel

Health body must cut deeper to find $83M in sav­ings

Winnipeg Free Press - - NEWS - JANE GERSTER jane.gerster@freep­ress.mb.ca

O find the $83 mil­lion in an­nual sav­ings nec­es­sary to bal­ance its bud­get, the Win­nipeg Re­gional Health Author­ity is plan­ning cuts that are val­ued at more than $91 mil­lion an­nu­ally.

It’s an un­for­tu­nate re­al­ity of hav­ing to cut a bud­get part­way through the fis­cal year, says Mark Jones, a part­ner with Olaf­son & Jones, a char­tered pro­fes­sional ac­coun­tants firm in Win­nipeg: you can’t un­spend what’s al­ready gone, so steeper cuts in what re­mains of the year are re­quired to meet the new tar­get.

That’s the case for the WRHA, which didn’t re­ceive ap­proval for the vast ma­jor­ity of its ser­vice-re­duc­tion pro­pos­als un­til early July.

And yet, not ac­count­ing for in­fla­tion, the WRHA would be look­ing at an­nual sav­ings of $91.7 mil­lion, rather than the provin­cially man­dated $83 mil­lion, if it were to keep the cuts en­acted this fis­cal year into 2018-19.

This raises the ques­tion: which clin­i­cal and ad­min­is­tra­tive ser­vices were sub­jected to steeper cuts in or­der to meet this year’s tar­get, and does the health author­ity plan to re­verse or ad­just them?

The WRHA won’t say.

The author­ity “con­tin­ues to work to­wards achieve­ment of the $83-mil­lion tar­get,” in­terim chief ex­ec­u­tive of­fi­cer Réal Cloutier said in one of sev­eral state­ments this week that did not an­swer ques­tions about how deeper ser­vice

Tcuts might be ad­justed for the next fis­cal year, if at all. Cloutier de­clined an in­ter­view with the Free Press. “It’s a great ques­tion,” Jones said. “Be­cause some­times a bud­getary cut will be, ‘OK, look, we can man­age to work ev­ery­body a lit­tle bit harder and do with­out this thing as part of a pro­gram for six months, but it can’t be an in­def­i­nite sav­ings.’”

In some cases, he said, it can be fairly ob­vi­ous what cuts are be­ing made as a “per­ma­nent sav­ings.”

For pro­grams such as out­pa­tient phys­io­ther­apy and oc­cu­pa­tional ther­apy, it wouldn’t make fi­nan­cial sense to shut­ter the pro­gram late in the fis­cal year for sav­ings of $1.5 mil­lion if the plan were to re­open the pro­gram later. (It is un­clear, how­ever, whether the $1.5 mil­lion the WRHA plans to save this fis­cal year from clos­ing the as-yet-stil­lopen pro­gram will be re­al­ized — and how much it will save each full fis­cal year mov­ing for­ward).

Mean­while, half­way through the 2017-18 fis­cal year, many pro­posed clin­i­cal cuts have yet to be ap­proved or re­al­ized across the prov­ince.

Health Min­is­ter Kelvin Go­ertzen has in­di­cated he’d rather the ru­ral re­gional health au­thor­i­ties miss their tar­gets than ap­prove cuts be­fore an­a­lyz­ing their prob­a­ble im­pact from a pro­vin­cial scope, but he’s of­fered no sim­i­lar as­sur­ances on be­half of the WRHA.

“We ex­pect the re­gions to man­age within their bud­gets and are con­fi­dent that all re­gions are care­fully mon­i­tor­ing their progress in this re­gard,” Go­ertzen’s spokes­woman said in an email.

The spokes­woman said $6 mil­lion worth of pro­posed WRHA sav­ings — that have yet to be ap­proved — has gone be­fore Shared Health Ser­vices Man­i­toba, be­cause the im­pact of th­ese cuts could af­fect the pro­vi­sion of health care across the prov­ince.

Be­cause of that, the WRHA says it has iden­ti­fied an ad­di­tional $6 mil­lion worth of po­ten­tial sav­ings in or­der to still meet its tar­get — in­clud­ing fur­ther re­duc­tions to over­time and “other sup­port cost ar­eas.”

It’s un­clear whether those will be clawed back should the orig­i­nal $6 mil­lion in pro­pos­als un­der re­view be ap­proved.

In a state­ment, Cloutier said the WRHA also found an ex­tra $4 mil­lion in sav­ings ini­tia­tives af­ter it re­al­ized $4 mil­lion of its orig­i­nal cost-re­duc­tion plans wouldn’t be re­al­ized un­til 2018-19. It’s also un­clear whether those will be clawed back next fis­cal year.

The WRHA de­scribes the newly found $10 mil­lion in sav­ings as non­clin­i­cal in na­ture and in­cludes prac­tices such as re­duc­ing over­time.

“Man­i­to­bans are find­ing out more and more that it’s all about the money with this premier, this health min­is­ter,” Op­po­si­tion health critic An­drew Swan said. “They are fo­cused on forc­ing oth­ers to reach the bot­tom line, with­out wor­ry­ing about what im­pact it has on pa­tient care.”

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