Hospital finances ready for coming challenges
It's been a long time since Kingston General Hospital's finances have looked this good – 16 years to be exact. That was the last time we ended the year with a working capital surplus and positive operating position.
“The fact is, everyone should be very proud of our financial situation now,” says Chief Operating Officer Jim Flett. “It's easy to create a balanced budget on paper but actually delivering on it is the hard part and everyone at KGH played a role in this success, from physicians, to staff, to management, to volunteers.”
And the good financial news doesn't end there. This past year we also polished off our Performance Improvement Plan (PIP), achieving $24 million in savings along the way. We also paid off some of our long-term debt and were able to allocate $12 million towards much needed capital equipment, technology and infrastructure.
“One of the things that impressed me most during the turnaround was the number of initiatives people implemented to help us become more efficient,” says Flett. “It wasn't one or two big changes that contributed to the completion of the PIP, but literally hundreds of smaller improvements, such as the installation of energy efficient light switches and the elimination of paper pay stubs.”
All together, they've enabled our hospital to do more with less – a situation and a mindset that will set us up to deal with challenges to come. And Flett sees plenty of them just ahead.
For starters, to keep provincial funding flowing, we'll need to pace with our peer hospitals and they've been improving too. We still have long-term debts to repay and we have a ways to go before we reach our target of setting aside $20 million each year for new capital equipment. All this while we'll be serving an aging population and answering to a public that expects us to have all the latest medical technologies and services.
And finally, the provincial economy being in the doldrums will also result in more financial pressure on hospitals. Just this fiscal year for example, rather than receiving the one per cent increase we were expecting from Queen's Park, we were hit with a 0.6 per cent decrease instead.
“The good news is our willingness to go through the PIP process and our ability to constantly improve how we do things has restored our credibility,” says Flett. “That resulted in the Ministry of Health and Long-Term Care recently giving us $7 million for carpet removal for example. Essentially, people are willing to invest in us again to help us achieve our corporate strategy and that good will couldn't come at a better time.”
If you'd like to know more about our financial performance last year, visit our reporting site here.
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