“Boom for private profits at the expense of public hospitals:” researcher warns hospital crisis will worsen due to Ontario government policy

New CCPA study warns about wasteful expenditure on private healthcare as Ontario budget promises $280 million to for-profit facilities

SARNIA, ON –(COMMUNITYWIRE)– Last week’s provincial budget shows that Ontario is heading down the same policy path that led to the severe hospital staffing crisis fueling rampant ER closures, hallway health care, and long wait-lists, according to the researcher who authored a new report about the interplay between hospital underfunding and growing expenditure on for-profit staffing agencies in Ontario.

Andrew Longhurst, research associate with the Canadian Centre for Policy Alternatives, said the government’s hospital funding for 2025-26 continues a long pattern of insufficient funding, even as for-profit operators received a substantial boost.

In his new report, Hollowed Out: Ontario public hospitals and the rise of private staffing agencies, Longhurst documented the co-relation between the rise in job vacancies and expanded use of private, for-profit staffing agencies which cost up to three times the cost of hospital employees. Between 2013-14 and 2022-23, hospitals paid out $9.2 billion to private staffing agencies.

“The staffing crisis in Ontario’s hospitals is driven by an irrational devotion to fiscal restraint, which is proving to be very costly by each passing year,” Longhurst said. “Unfortunately, in last week’s budget, the Ontario government failed to provide the funding needed to stabilize hospitals and reduce the wasteful expenditure on private agencies.”

Meanwhile, he said, the province had allocated $280 million in funding for for-profit operators to perform surgeries and diagnostic tests, even as hospital departments providing those same services were understaffed and underfunded.

“This appears to be the most significant injection of funding into investor-owned facilities over a two-year period outside of Quebec. It’s very concerning to witness the Ontario government pursuing private expansion of health care services at the cost of intensifying the crisis in the public system. This will predictably result in poorer services for Ontarians at a higher cost,” said Longhurst.

In Hollowed Out, Longhurst noted that Ontario’s per-capita funding for hospitals is the lowest across Canada. In the period between 2013 and 2022, the Ontario government made real dollar spending cuts in seven out of 10 years, contributing to insufficient growth in staff relative to demand.

The report shows that understaffing in public hospitals have fueled a 330 per cent increase in job vacancies since 2015. During this period, hospital staff incomes declined by 13 per cent.

The staffing crisis has precipitated a decline in access to care, according to the report, as evidenced by frequent ER closures and long wait-times.

“Saving our hospital services requires an investment in the staff who deliver them,” said Michael Hurley, the president of CUPE’s Ontario Council of Hospital Unions (OCHU-CUPE). “The government must commit to staffing standards including nurse-to-patient ratios to ensure manageable workloads, which would allow staff to provide care to the best of their abilities, improve morale and retention, and help stabilize the system.”

But the system is instead fracturing due to a combination of rising demand, ballooning agency costs, and provincial underfunding, said Longhurst. As a result, nearly half of hospitals faced a budget deficit in 2023-24 with a majority expected to be in arrears this year.

Longhurst recommended that Ontario follow the example of British Columbia and create a public sector staffing agency that provides relief to the most beleaguered hospitals, while phasing out private agencies over three years.

Other prescriptions to address the crisis include the development of a health care staffing strategy, and investments in hospital services as well as primary and community care.

“We can’t afford to underfund much-needed hospital care even as other services are also required,” he said. “We can have better primary and community care and well-funded hospitals to meet the health care needs of Ontario’s residents.”

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For more information, please contact:

Zee Noorsumar, CUPE Communications
znoorsumar@cupe.ca
647-995-9859