The administration of the Sun Country Health Region, like other larger provincially funded enterprises, are anxiously awaiting funding figures that will be released with the June 1 Saskatchewan budget.
The provincial budget, delayed by about three months due to the April 4 provincial general election, will decide the fate of several provincial agencies with regards to whether they will be able to report a net surplus or loss on their 2015-16 operations.
Sun Country’s financial statement bears witness to that situation based on information released on April 27 during the Sun Country’s board of directors’ meeting held in Weyburn.
As at the end of February this year, the local health region was showing a slight surplus of just over $3 million, which represented about five days of general operations, said John Knoch, the vice-president of finance and corporate operations.
That represented 11 months of Sun Country’s fiscal operations, the health region was showing about $143.4 million in revenues and $140.28 million in expenses nearing the end of the year. Knoch explained some over-budget items on the expense side were due to collective agreements the provincial government signed with unionized employees. But, there were some savings experienced by sustaining unfilled vacancies in a few administrative positions.
“It can be hard on staff sometimes, not having as many people as we would want,” said Knoch, but board chairwoman Marilyn Charlton noted that in some instances the jobs are posted and were to be filled, but it was just difficult to recruit and retain people in those particular jobs.
Legal fees had also jumped, these were fees associated with negotiations with radiology service providers.
Grants to third parties are also over budget, said Knoch, noting that St. Joseph’s Hospital in Estevan was one affiliate that was under expected revenues and increasing expenses.
He also noted insurance costs were higher than originally anticipated and will be adjusted accordingly once the new budget is crafted following the release of the provincial budget.
Maintenance costs were also over budget, while travel expenses were down.
Commitments for capital projects are on hold.
Knoch and Sun Country CEO Marga Cugnet said St. Joseph’s Hospital administration would have to respond to their deficit situation.
Greg Hoffort, executive director for St. Joseph’s, told the Mercury the shortfall is in the neighbourhood of $400,000 and most of it could be directly attributable to the sudden disappearance of out-of-province income which is coming in at about half of what it was in previous years. He said the hospital generally could count on about $1 million in income from health plans used by people who accessed Sun Country’s healthcare services. But with the slow down in the oilpatch, that income has been cut by about 50 per cent.
“These have been tough years. We went for three consecutive years with a surplus, but, that’s not the case this year,” said Hoffort who noted that negotiations and discussions will continue with Sun Country and the Ministry of Health.
“None of us really know what the June 1 budget will bring,” said Hoffort.
The hospital’s chief administrator said none of the shortfall can be attributed to the increase in services at St. Joe’s, meaning the introduction of the CT imaging services in recent months or the increase in obstetrical services (maternity).
“It’s the first time without a positive cash position in the four years I’ve been here, and collectively we’ve been spending more than we’ve been taking in, and there are no other sources of revenue we can pursue to make that up,” Hoffort said.
“We’ll see what promises will be met, we’ll see what they (provincial government) says about Lean and it’s funding, we’ll see what they feel is meaningful for us who have work to do on this file. I feel confident we can come to some sort of resolution, but in the meantime, yes, we’re currently working with a shortfall of over $400,000 on this year’s budget.”
During the Sun Country meeting, Knoch mentioned overall wages are higher than budgeted, since there were some unplanned increases in wages and a small hike in sick leaves, which are paid situations that can quickly add up. Costs for buildings and grounds will also be over budget, he suggested. Professional fees, the new CT scanner costs and physicians’ contracts are sometimes offset with corresponding revenues, but not always. Knoch said he figured the new Sun Country budget and final financial statements for 2015-16 might be available near the end of July.
The board members were pleased to learn that their governance costs had stayed well below budgeted amounts, with Charlton stating that much of that was due to the fact the board operated with a small six-person caucus for several months. The board now boasts of nine government-appointed members with Gary St. Onge as Estevan’s lone representative.
