One-time rate increases approved by Governing Committee

At their November 5 meeting, SEAMO’s Governing Committee unanimously approved the distribution of Year 1 & 2 rate increases to Departments. This is a core component of the recently ratified three-year Physician Services Agreement (PSA). Importantly, governors recognized the autonomy of Departmental practice plans in making financial decisions but wanted it known that these funds were intended to flow to physicians. The one-time monies will be released to Departments as follows:

  1. Year 2 (2022) rate increase (2.01% of base budget) distributed by December 31, 2022
  2. Year 1 (2021) rate increase (1% of base budget & shadow billings) distributed by March 31, 2023

The Year 3 rate increase (2023) is comprised of two components – a minimum base rate increase and gain sharing. High level details are provided below:

  • Minimum base rate increase
    • 25% of the increase applied to all groups
    • 75% of the increase allocated to address relativity
    • Varies by specialty
       
  • Gains sharing
    • Based on the difference between actual and presumed OHIP expenses
      • If actual OHIP cost is greater than $16.18 billion
        • No additional funds allocated to physicians
      • If actual OHIP cost is between $15.86 and $16.18 billion
        • Up to $50M allocated to fund existing APPs and establish new APPs
        • Up to $75M allocated to Hospital On-Call Coverage changes
        • Remaining funds allocated to physicians
      • If actual OHIP cost is less than $15.86 billion
        • 75% of the difference allocated to the Ministry of Health
        • 25% of the difference allocated to physicians

 
The impact of gain sharing will not be known until sometime early in 2024 when a preliminary review of OHIP spending will be completed.
 
SEAMO governors tasked the Resources Committee with making recommendations regarding the distribution of Year 3 funding. Work is now under way and progress reports will be provided in upcoming enewsletters as the work progresses. Stakeholder engagement will be an important part of this initiative. 
 
Please refer to the deck posted on SEAMO’s website for information regarding other elements of the recently-ratified PSA. 
 
If you require further clarification, please don’t hesitate to reach out