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Health Minister Eric Hoskins defended changes to seniors’ drug plan, which would charge some more for prescription drugs, arguing more low-income residents will now qualify.Chris Young/The Globe and Mail

Ontario is easing its four-year freeze on hospital budgets, earmarking an extra $345-million for the coming year, even as it continues efforts to rein in health-care spending, battling doctors over fees and charging some seniors more for prescription drugs.

The 1-per-cent increase to hospitals' base budgets is part of an extra $1-billion for health care that includes the government's previously announced pledge to put more money into home and community care. Health-care spending accounts for the largest portion of Ontario's close to $134-billion in annual spending – $51.8-billion for the coming year, or close to 39 per cent of the budget released Thursday.

Controlling the rising cost of health care has been a centrepiece of the Liberal government's efforts to tame a deficit that is expected to shrink to $4.3-billion this year, before the books are balanced in 2017. Health-care reforms, including changes to Ontario's troubled home-care system, are in the works, but none of the proposed changes are reflected in the spending plan.

The budget does not spell out how much money the province is setting aside for doctor compensation. Ontario doctors have been without an agreement for more than a year and the province imposed two rounds of fee cuts in 2015. The new budget states that "a predicable" budget for physician services is needed, but does not provide a dollar figure.

As part of the new spending plan, middle-income seniors also will be asked to pay more for prescription drugs. Beginning Aug. 1, the qualifying threshold for the low-income seniors' drug benefit will rise to $19,300 for singles and $32,300 for couples. The change is expected to allow an extra 170,000 seniors to qualify for the program. For those who don't, the annual deductible will jump 70 per cent to $170 from $100 and co-payments will increase by $1 to $7.11 for every claim.

Asked about the increase, Finance Minister Charles Sousa said the changes are the first in two decades. "Ontario is still the most generous in its supports for all seniors," he told reporters.

Mr. Sousa said other measures in the budget will save money for seniors, such as a program that will make the shingles vaccine free for those between 65 and 70.

The province is promising to revamp all its drug benefit programs by 2019 and starting this year will allow registered nurses to prescribe some medications and pharmacists to expand the vaccines they offer, including travel shots.

Opposition leaders criticized the new fees for placing an added burden on the elderly. "I think seniors are going to be shocked," said NDP Leader Andrea Horwath. "You can't tell me a senior citizen earning $19,500 a year is a rich senior."

Progressive Conservative Leader Patrick Brown said the new money for hospitals won't reverse four years of frozen budgets, but added he believes there are more savings to be found, especially in home care. "We spend far too much on administration."

Health Minister Eric Hoskins defended changes to the seniors' drug plan, saying the first changes to eligibility in 20 years will mean close to half a million low-income residents will now qualify.

Anthony Dale, president of the Ontario Hospital Association, said his members were "at a turning point" after four years with no increases to base budgets, forced to find $350-million within their budgets to cover wage increases alone.

"It is definitely getting harder and harder to balance budgets," he said.

Other measures in the budget include:

  • $130-million in additional funding for cancer care over three years;
  • $85-million over three years for primary-care teams and clinics to recruit health-care professionals;
  • $75-million more over three years for hospice and palliative care.

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