February 17, 1999

To:Board of Health

From:Dr. Sheela Basrur, Medical Officer of Health

Subject:Public Health 1999 Budget

Purpose:

To present the 1999 Operating Budget for Toronto Public Health to the Board of Health.

Financial Implications:

(1)Net operating budget - adjusted request

(a)The approved net operating budget for 1998 was $83,529,200. This figure represents the amount provided for public health services solely by the city. My initial request, prepared in November 1998 for the 1999 budget cycle, was $88,045,300. After extensive review I am revising this request to $81,038,000, a reduction of 3% from 1998.

(b)The adjusted operating budget request does not include the cost of harmonizing the tuberculosis, needle exchange, dental, food safety and food access programs approved by the Board of Health in January.

(2)Amalgamation target savings

As part of amalgamation, Public Health is expected to produce net savings of $5.4 million in 1999. We have achieved this target through manageable adjustments to service delivery.

Recommendations:

It is recommended that:

(1)the Board of Health adopt the recommended cost-reduction measures which have a manageable impact on programs and services and that these be incorporated into the 1999 operating budget submission;

(2)the Board of Health give final approval for the provision of optimal service levels in the Tuberculosis (TB) Control, Needle Exchange and the Food Safety programs as outlined in reports dated January 25, 1999 and further detailed in Appendix A of this report, and that the final costs for these programs, which are not included in the 1999 operating budget request, be submitted to Budget Committee for consideration:

(a)For the food safety program an additional cost of $594,111 in 1999, including a one-time cost of $47,011, and $1,641,270 in 2000 and subsequent years.

(b)For the tuberculosis control program an additional cost of $634,830 in 1999, including a one-time cost of $103,377, and $1,594,358 in 2000 and subsequent years.

(c)For the needle exchange program for the purposes of HIV prevention, additional cost of $233,375 in 1999, including a one-time cost of $47,297, and $558,234 in 2000 and subsequent years, plus one-time capital costs of $78,000 in 2000; and

(3)the Board of Health recommend that Council urge Health Canada, Citizenship & Immigration Canada and the Ontario Ministry of Health to provide funding toward an effective TB prevention and control program in Toronto, given that the City of Toronto accounts for 25% of TB cases in Canada, that 90% of the cases occur in foreign born individuals and that conditions exist for a resurgence of TB in Toronto.

Background:

Toronto Public Health is an amalgamating division bringing together six former health units within the new City structure. It is the only amalgamating division that must provide provincially mandated programs as well as meet local health needs specific to the city. The Medical Officer of Health has the dual responsibility of reporting to Board of Health, as required by the Province, and to City Council through the Commissioner of Community and Neighborhood Services and the City's Chief Administrative Officer (CAO).

The amalgamation of the former health units coincided with the provincial downloading of $40 million in Public Health costs to the City of Toronto. Thus the Board of Health and the City of Toronto became responsible for paying the cost of mandatory public health programs to Toronto residents and for additional programs to meet local health needs, subject to Council approval. City Council is legally obligated to pay the expenses of the Board and the Medical Officer of Health in this regard. These obligations are set out in the Health Protection and Promotion Act (HPPA), the Regulations and Guidelines. Whereas the province formerly provided cost-shared funding at a 40:60 ratio for public health programs, provincial funding to the City is now only available for specific areas; eg. Healthy Babies/Healthy Children, Preschool Speech and Language Services, the AIDS Hotline, the Ontario Works Dental programs (through Social Services), and Heart Health. The total amount of known provincial funding available to the City tied to these programs in 1999 is $17.4 million.

To fulfil its mandate to protect and promote the health of Toronto residents, Public Health must make its services accessible across the city; be responsive to diverse needs; improve the overall health of the population and maximize efficiency in the delivery of public health services. As I reported in my January 14, 1999 report on the State of the City's Health, Toronto faces numerous health problems as a result of our high needs urban population and the presence of emerging and re-emerging health threats. There are warning signs that the overall health of the population is at risk. Any decline in Public Health services is likely to have a negative impact on overall health.

I have attached a copy of my report for your information.

Comments:

(1) Overview

The original budget submission filed with the CAO is attached as Appendix B. Since that submission was prepared in November 1998, a number of budget amendments have been agreed to, while others are still under discussion. A final summary of recommended budget adjustments will be distributed at the Board of Health meeting.

Figure 1 of the original submission describes the overall budget and actual expenditures for the amalgamating health division for 1998, for comparison with the 1999 proposed budget. The budget is broken down by service, i.e. Support Services, Planning & Policy, Family Health/Healthy Lifestyles, Communicable Diseases and Healthy Environments. Because the amalgamating division is moving from six different service structures in 1998 to one service structure in 1999, comparisons of service costs and variances between 1998 and 1999 are not valid.

(2) 1998 Budget Experience

The 1998 budget was $92,830,600 gross and $83,529,200 net. The gross budget reflects total expenditures, the net budget total expenditures minus revenues. Actual expenditures for 1998 are below budget by $2,548,400, gross and $5.2 million net, in part for the following reasons:

(a)delayed implementation of new/expanded programs (e.g. Healthy Babies, Healthy Children, Healthiest Babies Possible, Parents Helping Parents)

(b)position gapping pending the final outcome of divisional reorganization

(c)unbudgeted provincial funding for the Preschool Speech and Language Services System.

(3) 1999 Operating Budget Submission

My initial proposal for a 1999 net operating budget of $88,045,300 was based on the 1998 budget, described above, with the +addition of the following expenditures:

(a)$859,800 in annualized funding for the expansion of Healthiest Babies Possible and Parents Helping Parents as directed by Council in 1998;

(b)$2,035,300 that was downloaded for the Public Health Research Education and Development program in January 1998, which has 15-month transitional funding and no secured revenue, beyond March 31, for 1999;

(c)elimination of unplanned position gapping, which totalled $2,702,600 in 1998;

(d)miscellaneous internal expenditures, e.g. corporate expense policies, overtime, totalling $594,600.

(4) Corporate Expectations

(i) Amalgamation target

As discussed in the 1998 budget submission, Public Health's amalgamation reduction target is 10% or a total of $8,569,700, over two years. In 1998, we realised a 3.5% reduction, or $2,866,900, leaving $4,277,100 for 1999, which we have achieved through manageable service adjustments. See Appendix C.

(ii)Enhancement and downloading costs

In addition, to the amalgamation reduction target, Public Health is expected to identify further savings of $2,895,000 to absorb the enhancement of the Healthiest Babies Possible (HBP) program approved by City Council in 1998, and the Public Health Research Education and Development Program which was downloaded by the Province. This program conducts program evaluation, applied research, program development and continuing education for staff and students, and ensures Public Health programs meet best practice standards. Given the size of the new city, its importance in North America, and the high level of need in the Toronto, it is essential that the Public Health Division maintain an effective evaluation, applied research and development program. Public Health cannot fully absorb Healthiest Babies Possible or the Public Health Research, Education and Development functions in 1999 without an unacceptable impact on other public health programs and services.

(5)Future budget pressures

As described in Recommendation 2 above, in January the Board of Health approved in principle the provision of optimal service levels for the City of Toronto in the dental, food safety, food access, tuberculosis (TB) control and needle exchange programs, and requested the Medical Officer of Health to report back on final budget estimates. The estimates, summarized in Appendix A, are not included in the 1999 budget proposal as this was submitted to the CAO in December prior to completion of the reports.

Based on a detailed review of the budget requests for these programs, a reduction of almost $300,000 has been achieved in the monies required for TB Control, primarily through the use of para-professionals for provision of DOT to low-risk uncomplicated cases. This is manageable as a service delivery option although it will reduce the flexibility to use staff for other program components such as screening. Funding required for Food Safety has been reduced by $90,000. Funding required for needle exchange remains essentially unchanged from that presented earlier. The total additional annualized cost for these programs is $3,793,862 million plus $275,685 in one-time costs over 1999-2000.

As previously approved by the Board of Health on January 25, 1999, the food access grants program is recommended for reinstatement at additional cost to the City of $1.5 million, including costs to Public Health of $152,370 for program delivery. As well, additional annualized cost for the dental treatment program is $2.45 million plus $200,000 in one-time costs.

The budget does not include future costs associated with the implementation of new responses to critical issues facing the City, such as the Environmental Tobacco Smoke By-law or Homelessness. These requests will be detailed in separate reports to the Board in the spring and summer.

Budget impact

In Public Health's budget submission to the CAO, I have described the potential impacts on the City if Public Health is required to absorb the cost of the 1998 enhancements approved by Council and the Public Health Research Education and Development program. With 89% of the Public Health net budget tied to staff, reductions of this magnitude cannot be realised without staff cuts and reduced public health services to the residents of the City of Toronto. Because of time lines associated with the budget process, this report is being prepared without the CAOs final recommendations on the Public Health budget. A list of reductions that would be necessary to meet the corporate targets are being reviewed by the CAO and his staff and will be presented by the CAO to Budget Committee on February 22, and later that day I will share this information with the Board of Health. The Public Health budget will be reviewed in detail with Budget Committee later the same day on February 22, 1999.

Conclusions:

Toronto Public Health must create a service response that effectively addresses the needs of the population it serves. While the challenges associated with amalgamation have been considerable, Public Health is striving to structure a Public Health Division where excellence, effectiveness and efficiency provide the framework for service delivery. The budget pressures facing the Division pose a significant threat to our capacity to deliver effective programs and to address the complex and diverse health needs facing the largest urban setting in Canada.

Contact Name:

Dr. Sheela Basrur

Medical Officer of Health

Tel: 392-7402

Fax: 392-0713

Dr. Sheela V. Basrur

Medical Officer of Health

Appendix A

BUDGET IMPACTS OF SERVICE OPTIONS

FOR FOOD SAFETY, TB CONTROL & NEEDLE EXCHANGE

BUDGET IMPACTS OF OPTIMAL SERVICE LEVELS