Condition of Infrastructure in Health Care Sector is….

Much of Canada’s infrastructure was built after the Second World War and prior to the 1970s. A recent Auditor General’s Report for the Province of Ontario provides an excellent example of the condition of infrastructure within the Canadian health care sector.  The 2015 Ontario Auditor General’s Report says:

• The average age of the province’s hospitals is 45 years with over 50% of the hospitals at least 40 years old.
• A technical assessment of hospital facilities completed in 2011 helped identify $2.7 billion dollars of renewal needs considered eligible for ministry funding, requiring annual funding of $392 million to maintain assets in a state of what the Ministry considers good condition. Actual annual funding, however, has been $125 million since 2014/15 and prior to this it was $56 million.
• Over the last number of years, hospitals have had to use operating funds to fund capital. In the last five years, hospitals spent on average $45 million a year of operating funds on capital and other funding needs.
• The Province’s internal analysis has noted that investments on the current portfolio of assets have historically been favoured over renewal, leading to substantial deferred maintenance; ongoing maintenance and renewal activities have typically been underfunded and piecemeal.  $392 M annually optimally required; actual annual renewal funding is $125M
• This trend of funding new infrastructure rather than maintaining and repairing existing assets is expected to continue.

(Source: see http://www.auditor.on.ca/en/content/news/15_newsreleases/2015news_3.07.pdf )

 

Implications to Health Care Sector

For the Province of Ontario, it means hospitals are asked to deliver more while spending less, despite the unrelenting increases in energy and facility management costs.  A similar story could likely be found for other types of health care facilities or for other North American jurisdictions. Budgets are becoming harder and harder to balance, and some of the choices each hospital board faces are either to delay needed infrastructure projects, decrease facility management budgets, or decrease health care offerings, with none of the alternatives being attractive. Much-needed energy efficiency and infrastructure projects are often just delayed.  Acquiring the use of a new or refurbished infrastructure asset has become very challenging for the Canadian health care sector.  It is time for a completely new approach.

 

The Solution is….

The IGNITE Sustainable Communities Program, which was created by IGNITE Infrastructure Association Inc. for its members, is the New Way Forward for health care facilities to manage public infrastructure. The flexibility, structure, scalability, and collaborative nature of the IGNITE Program allow the health care facility to:

• Do what’s best for the health care facility
• Develop a sustainable, long-term infrastructure plan approach
• Take control of infrastructure costs
• Provide cost certainty for infrastructure operation and maintenance
• Remove many barriers from long-term corporate planning
• Address environmental issues

 

For more information on the IGNITE Sustainable Communities Program, contact us.