Build and modernize homes.

Ensuring safety and quality of care that meets the needs of residents by rebuilding today’s homes and increasing capacity for tomorrow.

Many of Ontario’s long-term care homes are 40 or more years old and some are nearing the end of their functional lives. These older homes feature three- and four-bed wards that do not meet the needs of residents, particularly those with Alzheimer’s disease and other dementias, who often find living with roommates stressful.

Ontario’s long-term care homes are getting older and we are not rebuilding them fast enough. Approximately 300 homes (that’s half of the province’s total homes) are due for significant renovations or to be rebuilt to meet current design standards and provide greater comfort and safety. Overall, we will need to modernize or rebuild 30,000 beds before the operating licenses expire in 2025 just to maintain the numbers we currently have. In order to meet growing demand, we will need even more.  

“Why is there such a huge difference between homes? And what is taking so long to upgrade all homes to the same standard?”

Read Andrew and Li’s story here.

Why we are so far behind.  

Despite a well-known, evidence-based demographic surge of seniors unable to care for themselves, increasing caregiver distress, escalating Alternate Level of Care bed rates in our hospitals and massive waiting lists to enter long-term care, we spent the last decade mired in a program to rebuild or renovate homes that simply doesn’t work.

The program implemented by the previous government to encourage building failed to allow many long-term care operators to redevelop homes that needed to be rebuilt. It was an unsuccessful program hindered further by an 18- to 24-month approval process. When combined with insufficient construction funding, bureaucratic delays and duplication, and excessive municipal development charges, redevelopment was essentially brought to a halt.

To meet the deadline of 2025, there should only be one redevelopment office with the authority to make the necessary decisions to approve projects. Both licensing and capital health have to come under the jurisdiction of this office and neither Local Health Integration Networks nor MPPs should be able to influence the redevelopment or relocation of homes. 

Specific solutions must be devised for the development of homes in urban areas and for small homes so that operators see building and rebuilding homes as a stable and viable investment.

Taking immediate action.

The government’s recent announcement to move forward with adding 6,000 new long-term care beds is a concrete first step towards the goal of building the 15,000 new beds Ontario badly needs. Along with its commitment to reduce red tape and minimize unnecessary bureaucracy, this government provides renewed hope that we will be able to rebuild older homes by 2025.

The need to encourage investment. 

To start, the fundamentals of investing in long-term care must be sound. A long-term care home operator must assess that the investment and risk are favourable relative to other projects. And the risk that concerns them most is the sustainability of long-term care as a sector. Without a multi-year commitment to regular construction cost inflationary increases, the ability of operators to retain 100% of the inflationary resident co-payment increases, and a continuation of preferred accommodation increases, most operators see building new long-term care homes as too risky. 

Current funding parameters are inadequate to enable redevelopment. To date, not many projects have been able to move forward. Action must be taken now for operators to plan appropriately, including accessing financing and phasing in construction, so that Ontarians have a portfolio of long-term care homes that are not only well-designed, but serviced by modern infrastructure that can support the medically complex needs of residents.  

Recommendation Estimated Annual Cost
1. Adding new beds to existing homes must be the priority. Many of these homes are in areas that have demand that far exceeds the existing supply. The new government’s promised 15,000 new beds should be added to existing, older homes over the next three years to grow them to a size that will make them more economic to redevelop in the future. $70,000 per bed, but the government has already set out that they will make 15,000 beds available over the next five years.
2. Construction funding subsidies (CFS) need to be increased if there is to be a concerted effort to bring this redevelopment work back on track. The province set the CFS rate in 2014 and did not update it to reflect the growing cost of building. Going forward, the CFS should be increased annually, and homes of different sizes will need different increases to CFS to support redevelopment. CFS should be increased based on construction cost increases since 2014 ($21 million), and going forward be increased annually based on the previous 12-month increase in construction costs.
To correct the CFS disparity between homes of different sizes: $33 million.
3. Exempt long-term homes from property taxes. Or change the classification of privately owned long-term care homes so that they can pay residential property taxes instead of commercial ones. Since the province already pays 85% of property taxes, either recommendation would result in significant savings for government. Savings of $64 million for 2019/20 and an estimated $263 million when all beds are renewed and 30,000 beds become operational.
4. Government must address development charges. Some operators must pay more than $50,000 per bedroom to municipalities. Municipalities should be mandated to reduce development charges to no more than $5,000 per new bed and to not charge to rebuild old beds. Unknown.
5. Urban land costs must be mitigated using a number of strategies. To start, since CFS is not sufficient to provide for the cost of land in urban areas, a committee made up of members from long-term care and the Ministry should establish a method to subsidize this cost. Government must amend growth policies to allow long-term care homes as a permitted use on lands designated as ‘employment lands.’ Unknown.
6. The Ministry’s approval and licensing process must be streamlined. Establish a single office that has the authority to oversee both licensing and capital health and to make decisions regarding redevelopment. Do not allow LHINs and MPPs to influence the process. Exempt current operators from the financial review and aligned licensing process, and eliminate the LEED Silver program and the certification process. Unknown.
7. Create a funding program to maintain safe and comfortable buildings. Lifts, beds, heating and cooling systems, electrical and plumbing, even roofs, windows and floors, all have to be maintained or replaced more than once through a home’s lifespan. It’s an issue that affects older homes as much as it does newer ones. To manage this, both homes and government will set up a dedicated capital maintenance fund. Both parties will contribute $1.50 per bed per day to fund capital maintenance projects and any money not used in a given year would stay in the fund until it is needed. $42.7 million.

What government can do about it:

The focus must start with the new government’s promised 15,000 new beds being added to existing older homes. Construction funding subsidies need to keep pace with current economic realities and be scaled to suit homes of different sizes. On top of this, all homes should be exempt from paying property taxes and if that’s not possible, their classification should be changed so they are paying residential property taxes instead of commercial. Government should also consider a number of strategies to encourage redevelopment where it is needed, especially in urban areas where the demand for beds outstrips supply.

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