Health Infrastructure Renewal Fund HIRF Program LHIN and Hospital Teleconference October 25, 2013

Contents Goals of the 2013/14 HIRF Program 2013/14 HIRF Roll-Out Changes to the 2013/14 HIRF Program 2013/14 HIRF Allocation Methodology LHIN and Ministry Roles Timelines Appendices 2

HIRF Goals To assist hospitals in renewing their hospital facilities by streamlining minor infrastructure renewal project approvals. Note: HIRF funding is not to be used for programs and services. To supplement a hospital’s renewal needs on a priority basis. To fully integrate HIRF with the Facility Condition Assessment Program (FCAP) to determine the highest priority infrastructure projects such that available financial resources may be directed towards those needs.

2013/14 HIRF Roll-Out The ministry has provided the LHINs with the following*: 2013/14 HIRF Guidelines 2013/14 Application Form and Business Case Template 2013/14 Settlement Form The ministry has instructed LHINs to post these documents on their respective websites *Note: The ministry has also provided notional allocations to each LHIN

5 Changes to the 2013/14 HIRF Program Key changes to the HIRF Program are as follows: All allocations are evidence-based fully aligning HIRF with the results of the Facility Condition Assessment Program (FCAP); As a result of alignment with FCAP, there is no longer a minimum HIRF amount for each LHIN; There is an exceptional circumstances process built into the 2013/14 program.

6 Changes for ChangesRationale Fully aligning HIRF with the results of FCAP. All projects with a FCAP Facility Condition Index (FCI) score 0f 0.3 or greater will be supported. This means there will no longer be a Minimum HIRF amount for each LHIN. All project decisions will be evidence- based. An exceptional appeals process for urgent situations. Examples of an urgent situation would be code violations, technical reports, notices from authorities etc. If a LHIN suggests a project that is not yet reflected in FCAP, a business case (1 to 2 pages) will be required with supporting evidence. Direct financial resources to highest priority projects and directs HIRF to assets with highest need for renewal. Hospitals may substitute projects from their identified project list (with endorsement by the LHIN and approval by the ministry). Allows hospitals to substitute projects if there is a higher priority. No HIRF projects under $5,000 and no grants under $5,000. Aligns with the capitalization threshold.

7 Additional Changes for LHINs and hospitals are encouraged to prioritize projects that can be completed within the fiscal year. However, a project may be started in one fiscal year and completed in the following fiscal year (see Guidelines for more detail). Where a project cannot be completed by the end of the fiscal year, HIRF funding for would be used for work completed in The hospital would receive the remaining HIRF funding in for the work to be completed in Hospitals must submit a settlement report 90 days after the end of each fiscal year (that is by June 30 th of the subsequent fiscal year).

8 HIRF Exceptional Circumstance/Project An Exceptional Circumstance is one where a hospital has an urgent need to complete an infrastructure project, and the requirements are not provided for in the FCAP database, and the project meets all other criteria set out in the HIRF Guidelines and is supported by a Business Case (template provided). A exceptional project will be eligible if: It meets all criteria outlined for eligible projects, with the exception of a FCI of 0.3 or greater; The project can demonstrate why it must be completed immediately and cannot be addressed in a future fiscal year; The project meets one or all of Priorities One – Three; Health and Safety; Code Compliance or Asset Integrity-Imminent Breakdown; and The LHIN can demonstrate why the project is a priority for the LHIN at this time.

HIRF Allocation Methodology Provincial Requirements Report To calculate each hospital corporation’s HIRF amount, the ministry ran a Requirements Report for the province based on data collected through the Facility Condition Assessment Program (FCAP) using the following eligibility criteria:  Hospital assets must have been deemed eligible as per the Facility Condition Assessment Program  Eligible assets had to have a facility condition index of 0.3 or greater (asset in poor condition)  Asset Requirements met one of the three priority groups: Health and Safety; Code Compliance or Asset Integrity-Imminent Breakdown  The cost of Requirements must have been less than $1M and not addressed by an approved capital project.  Requirements must have been ‘open’ when the data was collected. The Requirements Report generated: The total cost of Requirements for the province The total cost of Requirements for each Hospital 9

HIRF Allocation Methodology HIRF Grant Calculation The total cost of Requirements for each Hospital was calculated as a percentage of the total cost of Requirements for the province. The ministry applied the percentage of total cost of Requirements for each Hospital towards the Total Government HIRF Allocation to determine each Hospital’s eligible HIRF Grant. Example: Total Provincial Requirement Cost = $100,000,000 Total Requirement Cost for Hospital A = $10,000,000, or 10% of the Total Provincial Requirement Cost Total Government HIRF Allocation = $50,000,000 Therefore, Hospital A was eligible for 10% of $50,000,000 = $5,000,000 The final HIRF Grant were adjusted for minimum grant thresholds (i.e., no grant less than $5,000) and grants were rounded to full dollar values. 10

11 LHIN Role Advise their respective hospitals of their anticipated allocations for the fiscal year. Direct hospitals to the LHIN website for the HIRF Guidelines, Application Form, Business Case and HIRF Agreement. Review the Application Forms to ensure that: They are complete and are sent in both excel and pdf format; The Eligible Projects meet the eligibility criteria; and The Exceptional Projects meet the eligibility criteria and are supported by a Business Case. Assess the ministry’s anticipated allocations and recommend adjustments to those allocations if necessary to enable a hospital to complete an Exceptional Project; Submit to the ministry its recommendations together with the hospitals’ completed Applications Forms and all Business Cases. Note: Please refer to the HIRF Guidelines for detail on the LHIN Role.

12 Ministry Role Reviews the LHINs recommendations, the HIRF Applications and any Business Case and LHINs statement demonstrating why the projects are a priority; Approves or rejects a HIRF Applications and/or Business Case; Asks the LHIN to require the hospital to enter the Exceptional Project in the FCAP database May re-allocate allocations based on its assessment; and Advises hospitals of the amount of their HIRF Grants and the approved projects and require hospitals to enter into a Funding Agreement.

Targeted Timelines Notional allocation and Guidelines sent to LHINs the week of October 21, 2013; HIRF Application Forms and recommended allocations from LHINs by November 15, 2013; HIRF grant letters and agreements sent to hospitals December 16, 2013; Receive signed agreements back from hospitals by January 2014; and, HIRF payments made to hospitals by January

14 Appendices

Appendix A: HIRF Project Eligibility Criteria A project will be eligible if the project: Has an Facility Condition Index of 0.3 or greater; Is a minor infrastructure renewal project; Meets one or all of Priority One – Health and Safety, Priority Two – Code Compliance and/or Priority Three – Asset Integrity – Imminent Breakdown. Useful economic life of at least one year; Extends the useful life of the hospital facility or improve the hospital facilities quality and functionality; Involves the replacement of entire systems as opposed to components of systems; Is capitalizable; Costs between $5,000 and $1M inclusive; and, Can be completed in the fiscal year. *See 2013/14 HIRF Guidelines for more detail 15

16 Appendix B: How FCAP is Integrated into HIRF High level criteria: generally < $1M usually completed within one year focused on replacement not repair HIRF grants must first be used to address a hospital’s critical or highest priority projects, which hospitals are responsible for identifying FCAP data will be used to facilitate the identification of priorities  Priority 1 – Health and Safety Requirements  Priority 2 - Existing Code Compliance Requirements  Priority 3 - Asset Integrity – Imminent Breakdown Requirements HIRF may be used to fund a phase of a multi-year project with an understanding that hospitals cannot anticipate that future HIRF grants will be available for future phases

17 Appendix C: Facility Condition Index The Facility Condition Index (FCI) measures condition as the ratio of the sum of the near term needs for an asset divided by its replacement value.