March 15, 2014 – The Scarborough Hospital (TSH) Board of Directors has decided that it will not proceed with a proposed merger with Rouge Valley Health System (RVHS) at this time. The following TSH Board resolution was passed unanimously:
WHEREAS the Board of Directors (“Directors”) of The Scarborough Hospital (“TSH”) approved the amalgamation of the Hospital and Rouge Valley Health System (“RVHS”) on March 4, 2014 conditional upon obtaining, among other provisions, the following:
- the Ontario government’s approval of capital planning grants to commence the feasibility, planning and design for required facility renewal (one for the Scarborough community and one for the Durham West community), consistent with the minuted discussion of the Board; and
- Central East LHIN and/or Ministry of Health and Long-Term Care (“MOHLTC”) financial support to address unavoidable one-time costs and ongoing operating costs associated with merger activities;
AND WHEREAS that at the time of this resolution, the conditions itemized above have not been adequately fulfilled to ensure the long-term success of the proposed amalgamated hospital;
AND WHEREAS the TSH General site capital projects for surgical suite redevelopment and diagnostic imaging concourse (the “Capital Projects”), previously submitted to the MOHLTC by TSH and in-progress, were placed on hold by the MOHLTC pending the outcome of the amalgamation decision;
AND WHEREAS TSH will continue to participate in regional planning activities for clinical services and other related initiatives established through the Central East LHIN from time-to-time;
BE IT RESOLVED that:
- The amalgamation of TSH and RVHS be abandoned effective immediately, and shall be reconsidered when the conditions set out in the first recital above are satisfied;
- TSH accepts the Province of Ontario’s additional $3M in one-time funding, and will participate with RVHS in the capital planning process to address the infrastructure deficiencies and modernization of the hospital facilities that will lead to MOHLTC Stage 1 Capital Planning Process approval;
- TSH formally requests that the MOHLTC reinstate and expedite the next capital planning phase approval for the Capital Projects;
- Notice be given to the Members of the TSH corporation to cancel the previously scheduled Special Meeting of the Members on March 18, 2014; and
- The TSH Board acknowledges and thanks management, staff, physicians, community members, and our colleagues at RVHS for their work, support and contributions in the integration work.
At the direction of the Central East Local Health Integration Network (Central East LHIN) through a facilitated integration process, the hospitals worked closely with their stakeholders over the past year to explore ways to create an integrated system of health care services that would deliver outstanding care to meet the needs of the people in our community while using resources more effectively.
“A big part of this process has been listening to our patients, the community, and stakeholder groups,” said Stephen Smith, TSH Board Chair, “We received a broad range of feedback and ideas that have guided our work, which has been focused on putting patients first.”
“The hospitals have gained tremendous support for the merger from our many stakeholders,” said Robert Biron, TSH President and CEO, “The value proposition of the proposed merger is sound – it’s all about improving patient care and sustaining our local health care system for future generations.”
After completing a comprehensive preferred integration plan, legal and financial due diligence, and extensive stakeholder engagement activities, the hospitals came to the conclusion that a merger was the best way to continue delivering quality patient care for many years to come.
The proposed merger is aligned with the province’s transformation agenda as outlined in their Action Plan for Health Care, and it would ultimately improve care delivery for the communities served. To realize the full potential and benefits of integration, the two hospitals would need to organize their hospital sites as a system, rather than as separate, competing silos. As part of this, a single accountability structure (i.e., one hospital Board, one management team) would be an essential requirement.
However, mergers take time and money. Upfront investments are needed to ensure the merged hospital is set-up for long-term success. TSH and RVHS by themselves do not have the financial capacity to make the necessary investments to implement the merger successfully.
The hospitals therefore requested provincial government support for capital planning grants to start addressing the significant shortcomings of the hospital facilities, and also for operating funds for transitional and recurring merger-related costs. Unfortunately, TSH and RVHS were unable to secure the level of needed investments to make the proposed merger a reality.
If circumstances change in the future, TSH will reconsider the opportunity. TSH will continue to work with the Central East LHIN, RVHS, physicians and other health service providers to advance health care delivery for the Scarborough community.
“We thank our partners at RVHS, our community, our Board members, physicians, staff and all health care partners for working with us on this concept,” said Smith. “Your contribution and support is greatly appreciated.”