How financially healthy is your hospital? Eastern Ontario data paints a grim picture

A CBC News analysis of hospital financial statements shows nearly half of Eastern Ontario’s hospitals have struggled with their bottom line over the past three years, with some paying hundreds of thousands of dollars in interest on bank loans.

It’s a situation that may continue to worry advocates, experts and hospital executives, despite funding increases announced in Ontario’s latest budget.

“Hospitals are not financially healthy,” said Natalie Mehra, executive director of the Ontario Health Coalition, which advocates for better health care.

“Hospitals operating in the red is very destabilizing.”

among the wider shortage of family doctor And ER closed In recent years, Ontario Hospital sounding the alarm On structural financing deficit.

CBC News reviewed the financial statements of 23 eastern Ontario hospital corporations over the past three years.

Analysis of hospital data by comparing their total revenues with their expenses keeping in mind the recent realities Retroactive payment from the province and the cost of aging infrastructure and equipment.

This yielded data on each facility’s bottom line, which showed whether each hospital was in financial surplus or deficit at the end of each fiscal year.

The results show that almost half of the hospital corporations in the region have recorded losses in the last two years, and most are likely to post losses in financial year 2022-23.

Eight were in the red in all three years.

Some hospitals borrowed millions in high-interest private bank loans and paid tens to hundreds of thousands of dollars in interest payments during that period.

“It’s very significant that half or more of the region’s hospitals are routinely in the red,” said Mehra, who reviewed the data. He added that digging into short-term bank loans “is not an appropriate way to run a hospital system.”

“The public is just paying interest on that money instead of funding the hospitals.”

$1.1B funding boost from province

In March, Ontario’s budget allocated Additional $1.1 billion for hospitals The government says the increase in funding this coming year will help provide higher quality care and make the system more efficient.

But that’s significantly lower than both the Ontario Hospital Association and Ontario’s independent fiscal watchdog Estimate the needs of a heavily loaded area.

The government is also investing about $64 billion in health infrastructure over the next decade.

“That investment is still something,” said Mehdi Ammi, a professor of health economics and policy at Carleton University.

But the problem is the lack of basic funding that hospitals receive, as well as the lack of reactive “one-time injections” of money.

“I don’t want to be disappointing, but I don’t have full expectations that this additional money will be enough to make a big difference,” he said. “If you want to solve a structural problem this is not the right mechanism to use.”

This is a sentiment expressed by some hospitals in the area.

The Mississippi River Health Alliance, which represents Carleton Place & District Memorial Hospital (which reported three years of shortages), told CBC the recent boost is welcome but “does not fully address the growing gap between hospital funding and the cost of providing care.”

“Urgently addressing that gap is critical to ensuring short- and long-term sustainability for Ontario’s hospitals,” Brad Harrington, president of the coalition, wrote in a statement.

Balancing the budget, millions in bank loans

The province expects hospitals to balance their operating budgets, which account for spending on areas such as staff and supplies.

Looking strictly at those budgets, some hospitals like CHEO and Montfort appear financially healthy, reporting balanced balance sheets or operating surpluses over the past few years.

But CBC’s analysis looks at the risks to the economy, taking into account gross margins — which include interest on loans, amortized costs like wear and tear on buildings or equipment depreciation — that could put some of those same hospitals at risk.

Ministry of Health Recently struggling hospitals have been tasked with creating a three-year plan According to hospitals like Montfort, to balance their budgets, an exercise that will mean balancing their gross margins including amortization by 2028.

“We remain cautious. It doesn’t always pay to be a high-performing hospital,” Montfort CEO Dominique Giroux said in a statement to CBC about the 2026 budget funding boost.

While “pleased” with the increase, Giroux said Montfort received “not a penny” from the Ontario hospital investment in December. Nor was any money received from similar investments in 2020-21, he said.

“This is not inspiring for our teams to be demonstrating financial courage,” Giroux wrote.

For the upcoming fiscal year, Giroux said Montfort is projecting a deficit, but aims to return to a balanced operating budget next year.

But the situation looks quite different for institutions like Perth and Smiths Falls District Hospital.

The hospital lost money for four consecutive years and its liabilities exceeded its assets by $12.9 million. According to its 2025 financial statement, it intends to rely on bank financing in the short-term and other cost-cutting measures.

While many hospitals have long-term investment borrowing, financial statements from Eastern Ontario hospitals show that a handful of them are reporting “bank indebtedness” – basically a reliance on high-interest, short-term loans.

The Perth hospital had a bank loan of $5.8 million. It also paid $372,000 in interest over the last three financial years.

Ammi said, this kind of dependence on banks is not normal.

“You shouldn’t see a hospital borrowing money like you do on your credit card, just to essentially pay for some emergency expenses,” Ammi said.

“It’s really worrying.”

In a statement to CBC, Perth and Smiths Falls Hospital CEO Michael Cohen reiterated that the hospital faces “significant financial pressures” driven by staffing, supplies and infrastructure costs while serving a growing rural population.

“Our financial challenges reflect these broader system challenges,” Cohen wrote, adding that any increase in hospital funding from the province is welcome.

Other corporations in Eastern Ontario reported similar conditions:

• Quinte Health (which includes Belleville, North Hastings, Prince Edward County Memorial and Trenton Memorial hospitals) reported $2,860,000 in bank debt and $124,971 interest on it by 2025.
• Winchester District Memorial Hospital reported $1,184,450 bank indebtedness in 2025. A spokesperson told CBC that thanks to recent additional funding, the hospital expects to end this fiscal year on a balanced note.
• Brockville General Hospital paid $443,588 in interest to banks between 2022 and 2025 and reported $444,077 in bank indebtedness through a line of credit due in 2024, which was paid off in 2025.

“They should not take short-term loans to make ends meet,” Ammi reiterated. “Using these kinds of Band-Aid fixes… it’s not promising for the future.”

“The province needs certainty from hospitals that they are able to plan for long-term sustainability to ensure communities across the province can receive high-quality care,” wrote Emma Popovic, a spokesperson for the health minister. Sylvia Jones, In a statement to CBC.

It’s not just the hospital sector that’s facing a “funding crisis,” said Dr. Lewis, a University of Ottawa sociology professor who oversees health policy and leads the Canadian Health Workforce Network.

This crisis is affecting all sectors – including primary, long-term and home care – and could cause disruption to hospitals if not properly addressed.

“(We) really need thoughtful, dedicated funding,” Bourgault said.

“But (we) also (need) to invest upstream to prevent the crisis we are seeing in the hospital sector from exacerbating.”