We need to ensure that equity is built into the provincial government’s plans to restructure the way funding is allocated to hospitals (see Ontario proposes radical overhaul of hospital funding  by Karen Howlett in March 7 Globe and Mail).  Adjusting to reflect population health needs is a significant advance over simply adjusting historical budgets or allocating money in terms of numbers of procedures performed.  But we need to ensure equity is built into the funding reforms:

• it isn’t just that’s some areas are growing, but some communities are poorer and poorer people tend to be less healthy and have greater and more complex health needs – and, at the same time, tend to have more inequitable access to the care they need;
• some areas are socially very diverse and this often means that hospitals need to provide interpretation and services in many languages.  This needs to be reflected in funding formula;
• this isn’t just a question of hospital funding – more health disadvantaged communities also rely on a dense network of often  poorly funded community services.  These community services must be funded on a more stable and flexible manner.
• looking forward, there needs to be more up-stream investment in preventative services and health promotion programs.  LHIN-wide funding formulas need to be able to support this goal of providing more services up-stream and in community settings, as opposed to only when people get sick and need hospitals. (See my report with Dr. Michael Rachlis for more on this: Ontario’s Health-Based Allocation Model through an Equity Lens.)  

There has also been discussion of “pay-for-performance” models linking funding to hospital efficiency.  Here also, we need to be very careful about equity.  if hospitals will be rewarded for doing more procedures with better outcomes, there is a real incentive to cream skim.  Poorer people will have more complex – and therefore expensive or time-consuming – needs and their post-procedure outcomes tend to be worse – all of which means that hospitals who are looking to keep their stats up have a real incentive to avoid the sicker and worse off.