By John AldisVice-President Corporate and Post-Acute Services,
Chief Financial Officer
As we close the books on our successful three-year Deficit Elimination Plan (DEP), I’m pleased to report that the hospital continues to optimize spending of public funds on quality patient care.
The plan ended officially on March 31, 2011, and has set the foundation for the hospital to start making meaningful reinvestments in patient programs and services, continuous quality improvements, and new equipment that benefits our patients and staff.
Years of not balancing its books had put Rouge Valley Health System (RVHS) in a situation where it could not afford to maintain and renew its facilities and equipment. The hospital was essentially bankrupt. We had no surplus cash, we covered payroll through our line of credit, and the bank would not lend us any more money. Three years later, our collective efforts have paid off for patients and the hospital.
Our plan was not just about a financial turnaround. It was about balancing financial responsibility with access to services and quality improvement. We have maintained our DEP commitment by providing the same or greater access to quality care for our patients and community. In fact, we now see more patients than we did in 2007–08 before the DEP started.
Our success has truly been a team victory for the patients of our communities in east Toronto and west Durham. Staff, managers, physicians, and volunteers across our organization have pulled together to do more and better with less. We started by comparing ourselves to how the best hospitals were providing quality care with lower infection rates, lower return rates, and shorter wait times. They were doing all this and spending less per patient. Three years later, Rouge Valley is among the leaders in our peer group for quality and fiscal responsibility. We are delivering higher quality care, as measured by the province, while making the most of our funds for our patients.
We also embarked on a long-term transformation journey using a Lean management philosophy and teamwork after a platform for success had been established by our DEP.
Now, after years of chronic deficits, we have been spending within our means since 2008–09 generating surpluses, and becoming more efficient and effective each year. While our operating results for 2010–11 are not yet finalized, we have surpassed our budgeted bottom line of $5.2 million. This means we have money to allocate to operational priorities (e.g., programs and services such as pharmacy services, a short stay unit, and critical care staff training) and invest in new equipment (e.g., equipment for cardiac catheterization, surgery, and patient mobility) and maintenance for our hospital campus buildings, which were built in 1967 (Rouge Valley Centenary) and 1964 (Rouge Valley Ajax and Pickering). With our improved cash flow, we can also borrow for big ticket items that we have been unable to tackle for years.
The ongoing maintenance needs include rather unexciting, but crucial things such as a new boiler, new roofing systems, as well as fire, electrical and water system upgrades. We can’t go out and fundraise for these items. It just isn’t something people would be attracted to in a campaign. We also have major capital equipment needs like catheterization labs, central patient monitoring systems, and information technology.
Being fiscally responsible and generating surpluses is the best way to ensure we have the facilities and equipment to be the best at what we do. Joint capital planning with the RVHS Foundation over the last three years is also helping focus the Foundation’s fundraising efforts on the hospital’s priorities such as an MRI scanner for our Rouge Valley Ajax and Pickering campus, diagnostic equipment, and new medical beds at our Rouge Valley Centenary campus.
Our DEP was just the beginning. A new three-year financial plan is being developed to support our recently refreshed Strategic Plan On-A-Page. I look forward to sharing this plan with you in the summer and continuing to build on our success over the next three years.
I congratulate all staff, management, physicians, board members and volunteers for this outstanding achievement. We are reinvesting in the future for our patients and communities thanks to you.