Scarborough Cluster Hospitals Facilitated Integration
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1 Scarborough Cluster Hospitals Facilitated Integration The Scarborough Hospital June 20, 2013
2 Future of Ontario s Hospitals Today, the Province of Ontario spends some 42% of its budget on health care. if we didn t change anything,, our health costs would increase by $24 billion 50 per cent more than today from changing demographics alone... Without a change of course, health spending would eat up 70 per cent of the provincial budget within 12 years, crowding out our ability to pay for many other important priorities We will shift more procedures out of hospital and into non-profit communitybased clinics if it will mean offering patients faster access to high-quality care at less cost. We will not compromise on quality, oversight, or accountability. Ontario s Action Plan for Health, 2012 Hospitals are legislated to balance their budgets and must work with LHINs to achieve balanced budgets. <LHSIA 20. (1)> 2
3 Scarborough Hospitals: Quality Care for our Patients The Scarborough Hospital 3-year Exemplary Standing, Accreditation Canada: April 2013 Home to one of the largest Regional Nephrology Programs in North America with over 6,000 patients receiving care Designated as Central East LHIN s Regional Vascular Program Rouge Valley Health System 4-year Exemplary Standing, Accreditation Canada: Rated # 1 in six clinical indicators in the Canadian Institute for Health Information s hospital reporting project of 2013 Designated by the Central East LHIN as regional centre of cardiac care, in partnership with Lakeridge Health and TSH Quality care, patient safety and service access remain our on-going commitments during any health system transformation. 3
4 TSH/RVHS - Hospital Financial Challenges Hospital 2011/12 (Actual) 2012/13 (Forecast) 2013/14 (Budget) 2014/15 (Estimate) 2015/16 (Estimate) RVHS $4.9M surplus $4.8M surplus $0M balanced $15M unfunded inflation $10M unfunded inflation TSH $4.2M deficit $0M balanced $0M balanced $13.4 M unfunded inflation $9.6 M unfunded inflation $28.4M unfunded inflation $19.6M unfunded inflation Increases in hospital annual funding have fallen from 2.50% in 2008/09 to 1.37% in 2011/12 and are now < 0% in 2012/13 and will continue to be reduced further in 2013/14 and 2014/15. Hospitals have reduced administration costs and changed service delivery models to respond to revenue shortfalls. To ensure that they continue to balance, they may have to decrease (reduce/divest) services going forward. 4
5 Financial Pressures Common to ALL Ontario Hospitals Category Demand growth due to population increase Demand Growth due to aging Compensation Increases (Labour Contracts) Non-Compensation Inflation (Utilities, insurance, etc.) Restructuring Costs (Voluntary exits, early retirement, severances, etc.) Impacts of NEW Ontario Hospital Funding Model Average Annual Increase for Central East LHIN Hospitals 1% 1% 2-3% 3-4% 10-50% of funding impact Negative to neutral impact 5
6 The Scarborough Hospital s Response: Strategic Plan Refresh - From the CE LHIN s March 27, 2013 presentation 6 6
7 Central East LHIN Motion #3 March 27, 2013 Effective immediately, The Scarborough Hospital will partner with Rouge Valley Health System in a facilitated integration planning process to design and implement a Scarborough Cluster hospital services delivery model through: Integration of front-line services; Back office functions; and Leadership and/or governance, in order to improve client access to high quality services, create a readiness for future health system transformation and make the best use of the public s investment. With input from its stakeholders, the hospitals will submit to the Central East LHIN, for its review, a directional plan in no more than 60 days. The proposed integration Plan will be submitted to the LHIN within six months. 7 7
8 Central East LHIN s Mandate It is the LHIN s mandate to promote integration opportunities that enhance both the client experience and achieve greater value for money (e.g., efficiency). The Central East LHIN Board will establish the expectations for the Facilitated Integration Planning Process to ensure due diligence, transparency, and community engagement. The Central East LHIN Board will consider the Directional Plan and Integration Plans and other reports submitted by RVHS and TSH Governance in making a determination on the endorsement or approval of any service changes. The LHIN will liaise with the Ministry of Health and Long-Term Care to ensure changes are consistent with the Public Hospitals Act and the directions of the Minister of Health and Long-Term Care. The Central East LHIN staff will support the hospitals integration planning efforts through the provision of information and expertise. 8 8
9 TSH / RVHS Boards Responsibilities The hospital Boards will establish a TSH / RVHS Hospital Services Integration Leadership Committee (15 days) The hospital Boards will collaborate to: Confirm Vision, Principles, Objectives and Decision Making Framework for integration planning process conducted by the Leadership Committee Confirm Terms of Reference and Scope of Decision Making Authority of the Leadership Committee Call on the Leadership Committee to develop workplan and receive recommendations on the finalization of the Directional plan Endorse the Directional Plan and submit Final Directional Plan to the LHIN Board (60 days) The hospital Boards will receive reports from the Leadership Committee and supporting structures The hospital Boards will receive and consider the Proposed Integration Plan from the Leadership Committee (5 months) The hospital Boards will provide Notice of the Integration Plan to the Central East LHIN Board (6 months) 9 9
10 Integration Leadership Committee (ILC) Membership Name Organization / Stakeholder Group Israt Ahmed Community Member (RVHS) Robert Biron TSH CEO Dr. Jagdish Butany TSH Board Member Dr. Tom Chan TSH Chief of Staff Dr. Jordan Cheskes RVHS Medical Staff Society Representative Fred Clifford RVHS Board Member Rik Ganderton RVHS CEO Deborah Hammons Central East LHIN CEO Dr. Henry Huang RVHS Medical Staff Society Representative Dr. Eric Hurowitz TSH Medical Staff Association Representative Jay Kaufman RVHS Board Member Lyn McDonell TSH Board Member Dr. Naresh Mohan RVHS Chief of Staff Paul Rook Community Member (TSH) Stephen Smith (ILC Co-Chair) TSH Board Chair Dr. Robert Ting TSH Medical Staff Association Representative Joan Wideman (ILC Co-Chair) RVHS Board Chair 10
11 Facilitated Integration Planning Process Key Success Factors Strong Leadership Shared Vision Engage and Respond Planning and Process 11
12 Guiding Principles Collaboration: We believe that collaboration will lead us to better solutions. Accessibility: We believe in providing accessible patient care to our community. Sustainability: We believe that we must find new solutions to sustain our health care system. Excellence: We believe that we must never waver from our responsibilities to provide quality patient care, and to be transparent and accountable to our stakeholders. 12
13 ILC s Vision We wish to create an integrated system of health services that is responsive to the needs of the population, provides appropriate access, delivers an outstanding experience for patients and their caregivers, and uses our resources efficiently so that these services are sustainable into the future. 13
14 Integration Planning Process Continuum of Integration Integration of: Patient care services Cooperation Coordination Strategic Alliance Seizing opportunities to work cooperatively, no formal agreements, individual led innovations Transactional work with limited formal agreement, discussion and reporting at Board level, partnerships developing at frontline and between disciplines Formal relationships at Board level in certain areas, respective Boards control pace and substance of integration Merger Combining into one entity through establishment of single Board governance and pooling of interests, one structure, one system, one process, one culture Back office functions Leadership and/or governance Collaboration Accessibility Sustainability Excellence Integrated Health Delivery System 14
15 ILC recommendation to the Hospital Boards Motion Passed June 19, 2013 The Integration Leadership Committee recommends to the Boards of The Scarborough Hospital and Rouge Valley Health System to proceed with stakeholder engagement and due diligence in order to determine what benefits a merger of two hospitals will provide to the Scarborough community. 15
16 Rationale Develop a long term vision for hospital services for the Scarborough communities. Develop a solution that will make the Scarborough hospitals more competitive in response to changes in how the government is changing the funding model. Develop a solution that has the potential to maintain access and maintain or improve quality while dealing with a decline in available financial resources. Ready the two hospital corporations for continuing health system transformation by developing a platform for better connecting with other sectors, like primary care and community agencies. This approach was chosen because the ILC is of the unanimous view that these benefits cannot be fully achieved without a clear accountability structure represented by a single governance and leadership model. 16
17 What s Due Diligence? An investigation with a potential partner to assess the current state of the organizations and the strength of a proposal, including: Compatibility (for example, mission/vision/values, governance structures, Board policies, etc.) Legal and regulatory assessment Financial overview and opportunity Health human resources Facilities infrastructure Equipment inventory and life cycle plan Information systems Programs and services inventory 17
18 Stakeholder Engagement The ILC is committed to undertake comprehensive stakeholder engagement to obtain your valued input: Community that we serve Staff and volunteers Physicians Other health service providers The feedback will inform the ILC and the Hospital Boards in their decision making 18
19 19 19
20 Next Steps - Draft of High Level Milestones Milestone Dates Develop Project Charter, team structure, approach and workplan June 21 July 1 Develop Stakeholder Engagement and Communication Plan June 21 July 31 Confirm Due Diligence Process June 21 July 31 Stakeholder Engagement August 1 September 30 Stakeholder Engagement Report October 3 Current State Analysis data and information gathering (Due Diligence) June 21 September 30 Draft Business Plan and Preferred Integration Plan October 4 Submit Integration Plan to TSH and RVHS Boards of Directors October 11 Submit Integration Plan to Central East LHIN Board of Directors October
21 Budget Incremental costs to complete requirements: Community and stakeholder engagement activities Due diligence requirements Staff augmentation for decision support Facilitation Legal Total estimated costs of $1.1M to be shared equally between TSH and RVHS 21
22 Motion 1b:Maternal-Child-Youth (MCY) Service Delivery Model for the Scarborough Cluster We do not believe that the review and evaluation of integration options for MCY services as contemplated in Motion 1b can be completed effectively in isolation to the many other interdependent patient programs. The ILC is recommending that the Hospital Boards request from the Central East LHIN that the requirements of Motion 1b be realigned under the requirements of Motion 3, giving the hospitals the necessary time to complete its due diligence and stakeholder engagement for the preferred integration plan. The hospitals remain committed to addressing the expectations of Motion 1b for MCY services through the broader integration strategy. 22
23 Questions 23
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