Ontario’s hospitals say they need an additional $1 billion this year to keep up with inflation, population growth, and rising service demands—warning that current funding levels leave them facing financial pressures far greater than last year’s deficits.
The Ontario Hospital Association (OHA) reported that hospitals across the province—big and small, urban and rural—ended the last fiscal year in the red, with a combined deficit of $360 million for 2024-25. That figure was lower than the initially projected $706 million due to year-end government funding, but it still leaves the sector carrying forward significant financial baggage into 2025-26. When this existing shortfall is combined with new cost pressures, hospitals say they need a further $1 billion, even after factoring in the $1.1 billion increase announced in the spring budget.
Melissa Prokopy, the OHA’s vice-president of policy and advocacy, said hospitals are grappling with “a multitude of complex challenges — financial challenges, operational challenges and pressures… things like inflation, the increased demand for services.” She noted that while Ontario hospitals are among the most efficient in Canada, measures like streamlining admissions and using innovation to shorten hospital stays can only go so far.
The provincial government is expected to deliver its fall economic statement in the coming weeks, but Health Minister Sylvia Jones’s office has not indicated whether additional funding will be included. “Our government continues to work with our hospital partners, including the Ontario Hospital Association, to ensure that all of our hospitals have the tools they need to continue to deliver the high-quality care patients deserve,” spokesperson Ema Popovic said in a statement. She added that hospital funding has increased by four per cent this year—the third consecutive annual rise.
Hospital leaders say beyond more money, they need multi-year planning to stabilize budgets and prepare for long-term demographic shifts. “Many of these pressures are structural in nature and years in the making,” Prokopy said. “Sustaining service delivery in the short term while planning for an aging population and increasing complexity of care is going to be really important.”
Liberal health critic Lee Fairclough, a former hospital president, emphasized that labour costs dominate hospital budgets, leaving few areas to cut. “What are our other options? Continuing to reduce the quality of the food?” she said, adding that hospitals can only rely on measures like increased parking fees for so long. “At a certain point, you can’t say to a hospital, ‘You can’t cut service, but you still have to be able to pay for all of this.’”
Hospitals, she said, are managing as tightly as they can, and now it’s up to the government to step in with the financial support needed to keep Ontario’s healthcare system stable.