annual report 2016-2017 - lacghweb.lacgh.napanee.on.ca/uploads/annual report june 13 2017 -...

Lennox and Addington

County General Hospital

Annual Report

2016-2017

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Report from the Board Chair

and President & CEO

Good evening Ladies and Gentlemen. It is indeed a pleasure for me to present the 51st Annual Report of the Lennox and Addington County General Hospital Corporation and my first as Board Chair.

Throughout the past twelve months, many of us participated in various celebration events which were held in recognition of our Golden Anniversary. The last of the celebratory events was the planting of fifty trees throughout the Hospital properties. I’m pleased to note that all fifty of those trees have taken root and are maturing well.

Early on in the past year, our Hospital was busy working on the development of our Strategic Plan. Our current Strategic Planning document highlights four priority areas of which we will focus on over the coming three years. These Priority Areas include:

1) Patient Experience; 2) Access; 3) Quality and Safety; and 4) Sustainability.

For each of the above-noted Priority Areas, we established a specific goal.

For Patient Experience, our goal is to build on a culture that contributes to each and every patient and family having a great experience from registration through to discharge from the Hospital.

For Access, our goal is that by December 2019, the Lennox and Addington County General Hospital will have improved access to services for patients and families in our community.

For Quality and Safety, our goal is by December 2019, our Hospital will have an established culture of being a safe residential, environment as well as work environment. Various code protocols will become baseline knowledge for all, as we recognize our respective responsibilities in Hospital emergency management.

For Sustainability, our goals are:

By 2019, all designated beds, services and programs at the Lennox and Addington County General Hospital will continue to be operated in a very cost effective and efficient manner;

Operational savings will be invested in programs, services and information technology to benefit our patient population;

Increase employee and physician satisfaction, engagement and retention; and

Foster a good public image.

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The Lennox & Addington County General Hospital is committed to providing the highest quality of care possible for the community we serve. Our goal is to embed our core values - Teamwork, Respect and Communication - into all the services we provide.

Over the past year, we made a commitment to improve the following ten (10) quality indicators:

1. Improve Hand Hygiene Compliance Research shows that hand hygiene is the single most effective way to reduce the risk of health-care associated infections. Therefore, hand hygiene is a key issue for our hospital, and we continually work to improve compliance. Over the past year, 192 audits were completed and missed opportunities were reviewed with staff as a learning opportunity. Hand hygiene education is ongoing for staff, physicians and volunteers. A visitor hand hygiene information pamphlet was created which includes infection prevention information.

2. Reduction of Hospital Acquired Infection There are many activities implemented to reduce the chances of our patients acquiring an infection. Environmental cleaning audits are conducted monthly to ensure that standardized cleaning practices are adhered to by Environmental Service workers. Vancomycin-Resistant Enterococci (VRE), Clostridium Difficile (C. diff) and Methicillin-Resistant Staphylococcus Aureus (MRSA) information pamphlets are provided to patients and their families. Ongoing education on infection prevention is provided by our Infection Control Nurse. Our Pharmacist monitors antimicrobial use and any issues or concerns are reviewed at patient rounds.

3. Improve Patient Satisfaction In order to improve patient satisfaction, we implemented a number of initiatives over the past year. These initiatives include: installing bedside communication boards on the Convalescent Care (CVC) unit; installing and implementing self-registering kiosks at the front entrance, emergency department and lower clinic entrance; a project was undertaken to reduce the noise on the Acute unit; we implemented a new food delivery system; and, we finished the year off with a Nurse-lead patient flow initiative which resulted in a drastic reduction of wait times to get patients admitted to an In-patient bed.

4. Reduce the Number of Alternate Level of Care (ALC) Patients in Acute Care Beds We have actually made some significant progress on this quality indicator this year. Our new Social Worker has a new approach to move ALC patients to more appropriate settings. We provided all staff with an education refresh on the Home First program philosophy “If you come from home, you can expect to return to your home”. Health Links has joined our multidisciplinary team rounds. We implemented the use of the Confusion Assessment Tool (CAM) to identify patients with delirium.

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5. CVC Occupancy Rate The occupancy rate of our Convalescent Care unit is monitored to ensure we are meeting our target of 80 percent. Over the past year, our lowest occupancy rate was 83 percent and our highest was 93.3 percent. We continue to develop creative and innovative ways to promote our program with healthcare providers in our area.

6. CVC Falls The goal for our Convalescent Care residents, is to improve their mobility and general health so that they can return home. With this in mind, we know that we can never eliminate falls because our goal is to mobilize these residents. We can, however, ensure interventions are in place to prevent falls. Over the past year we have completed a falls assessment on all residents during admission; the Falls Program has been reviewed and updated; Hourly Rounding has been introduced; non-slip socks are available if residents don’t have appropriate footwear; and, reassessments are completed post-fall, by a Physiotherapist.

7. CVC Pressure Ulcer Prevention Pressure ulcer prevention is a high priority for our Convalescent Care residents. In order to prevent pressure ulcers, we have built the Branden Scale Assessment tool into our electronic charting system. Wound care champions perform bi-weekly skin assessments and staff receive wound care education. We have also created a wound care surveillance tool to monitor new or worsening pressure ulcers on a monthly basis.

8. CVC Elderly Mobility Scale In order to evaluate the success of our Convalescent Care program, we measure the improvement of residents’ mobility from admission to discharge with a goal to achieve a score of greater than ten (10) on the Elderly Mobility Scale at discharge. Each resident has an Elderly Mobility Scale score completed on admission, ongoing assessments during their stay and then a final assessment at discharge. On average, 86.5 percent of our residents have achieved a score greater than ten (10) by discharge.

9. Improve Compliance for Medication Reconciliation at Admission and Discharge Our Hospital continues to partner with patients to ensure that accurate and complete medication information is communicated consistently at transitions of care. We have reviewed and updated the Medication Reconciliation policy to reflect our new discharge and transfer process and our expansion of the medication reconciliation process into the Emergency Department. Our Chief of Staff monitors monthly, physician compliance rates and shares results with all physicians. New physicians receive one-to-one training so that they understand their responsibilities for the medication reconciliation process. The implementation of the Bedside Medication Verification process has proven to be a significant medication safety improvement process.

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10. Reduce Inappropriate Antibiotic Use In order to ensure our patients and residents are receiving the right drug at the right dose, frequency and duration, we have developed a strong Antimicrobial Stewardship Program. Our Pharmacist monitors antibiotic use and provides feedback to physicians on appropriate prescribing. Our antimicrobial stewardship team meets quarterly and reports directly through the Infection Prevention and Control Committee. Over the past year, the Antimicrobial Stewardship Program was reviewed and updated.

Patient and Family Advisors The Lennox & Addington County General Hospital’s Mission is to be a progressive hospital meeting the needs of our local communities through our people. One way to achieve our Mission, is to ensure the voices of patients and families are heard, considered and included in our Hospital’s programs and plans for the future. Our Patient and Family Advisors have proven to be a value added partner over the past year by ensuring the patients and families concerns and aspirations are understood and considered.

The following are the accomplishments of the Patient and Family Advisory Council (PFAC) over the past year:

Two representatives from our PFAC are active members on the regional working group for Chronic Obstructive Pulmonary Disease (COPD) and Hip Replacements.

One member of our PFAC was an active member on the Medical Assistance in Dying (MAID) Task Force.

Reviewed the plan and provided input into the planning and introduction of Intentional Rounding.

Provided input into the development of a web page for the hospital website which explains the role of the PFAC.

Reviewed the results of patient surveys and provided recommendations for improvement.

Provided input into the development of the Strategic Plan.

Provided recommendations to change the layout/design of staff identification badges.

Reviewed and provided input into the updated Incident Reporting Policy.

Today’s healthcare system has evolved into being a very sophisticated information technology environment and will surely continue as such in an ongoing fashion. In November 2016, our Hospital was recognized in a National Journal for having achieved Stage 6 of the Hospital Information Management System Society Analytics and Electronic Medical Record. Reaching stage six is no small feat because there are only seven other hospitals in all of Canada to have reached that level! Let me just note some of the information technology achievements we have reached over the past year.

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Health Information Management System Society Level 6.

Full physician documentation with structured templates and discreet data is implemented for at least one inpatient care service area for progress notes, consult notes, discharge summaries or problem list & diagnosis list maintenance.

Level three of clinical decision support provides guidance for all clinician activities related to protocols and outcomes in the form of variance and compliance alerts.

A full complement of radiology Picture Archiving and Communication System (PACS) to provide medical images to physicians via an intranet and displace all film-based images. Cardiology PACS and document imaging are scored with extra point.

Patient kiosks.

Bedside medication verification.

E-Kardex.

Real-time (near real-time) coding.

Pre-scanned, real-time scanning.

Peer reviewed coding.

Glucometer integration point-of-care

Server cluster replacement (virtual machine).

In our continuous efforts in bringing programs and services to our local community so as our patient population is cared for close to home, I am indeed pleased to report that the Napanee/KGH Satellite Dialysis Unit opened in November of 2016. The Dialysis Unit is now fully functional and operating at full capacity six days a week from 7:00 a.m. to 11:00 p.m.

Similarly, I am indeed pleased to say that the Acquired Brain Injury facility located at the Lennox & Addington County General Hospital Foundation’s Lenadco Complex opened in April 2017. The facility is full to capacity and in fact has a long waiting list for any admissions.

We have wonderful working relationships with both the Kingston Health Sciences Centre and Pathways to Independence, who are the respective operators of these two facilities.

As we look to the future we are very pleased with our business volume growth in all areas of our Hospital. In seeing the continued growth in Emergency Department visits and the number of Operating Room procedures performed at the Hospital, we think that it is time for our Hospital to own a Computed Tomography (CT) machine. To that end, we submitted a proposal to the Local Health Integration Network (LHIN) with the endorsement from all our Regional Hospital partners requesting approval for designation to acquire and operate a CT. I am indeed pleased to announce that the LHIN Board endorsed our request and on our behalf sent our designation request on to the Ministry of Health and Long-Term Care for their ultimate approval for us to have and operate a CT. We hope to hear a positive response from the Ministry of Health and Long-Term Care in the not too distant future.

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In conclusion, I want to express my deep gratitude and acknowledgement to the many individuals who contribute to the success of our organization. Our Board of Directors consists of individuals who are community minded and possess the qualities of being not only custodial, but more importantly, are builders and visionaries. These attributes are concurrently modelled by our staff, physicians, members of Volunteer Services and the Hospital Foundation. Thanks again to the aforementioned for their diligence and perseverance. These are indeed exciting times to be a contributor to the Lennox and Addington County General Hospital and I feel both humbled and privileged to meet the challenge of your Board Chair.

Sincerely,

Allan MacGregor Wayne Coveyduck

Board Chair President & CEO

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Report from the

Chief of Staff

“Priority Area One – Patient Experience”

Access, Quality and Safety, Sustainability, Integrated – all important themes in our Strategic

Plan, propelling us forward through the end of this decade. The Patient Experience however,

is the primary driver behind every concept we dream of, every business plan we draft and

every solution we network with our partners to achieve.

This year has marked the beginning of some very exciting new patient experience milestones

in our hospital. The combined leadership and efforts of the physicians, the nurses, the

administrative team, the entire support staff and all of our volunteers create what I like to think

of as the best hospital patient experience in the region. I might be accused of being a bit

biased of course….

Patient experience can be reflected in many forms, but before I highlight some of my personal

favourites I believe we should be most proud of, I want to take a moment to recognize the

contribution of a few physicians in particular, without whom our hospital wouldn’t be the place

it is today. This year marked the retirement from inpatient hospital care of veteran family

doctors Robert Reynolds, Chris Sosnowski and Valli Hota. While the hospitalist model of care

has become a sustainable system, this group of doctors cared for the community including

their own inpatients daily since their arrival in our town, a feat not often seen in many

institutions. Dr. Jeff Sloan will be celebrating his 25th anniversary on staff at LACGH and joins

the ranks of five (5) other doctors still on active staff here with well over 25 years of service

each. This group of docs exemplifies what “patient experience” focused care is all about, every

day they come to work. Their mentoring of the next generation of physicians will ensure that

these values are continued for years to come.

Onto more highlights putting patient experience as priority one. Our nurses and our

Emergency Department team have worked together to decrease the time patients wait for a

hospital bed once it is decided they need to be admitted for ongoing care, by over 50 percent.

This has made a significant difference in the flow of people through the Emergency

Department, the ability of staff and physicians to provide care and the comfort of the patient to

be settled into a quiet place to begin their healing journey.

Our Information Systems team, working with staff, physicians and patients in all areas of the

hospital, achieved an exceptionally significant milestone this year, achieving the HIMSS

Electronic Medical Record Adoption Model stage 6. This is far more than just a number. It

means we are one of only a handful of hospitals in the country to reach this sophisticated level

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of electronic medical records integration and leadership towards improving patient care and

the patient experience. This speaks to how we communicate, with ourselves and our patients.

On the Acute Care unit, our patients now leave the hospital with a copy of their discharge

summary, including an up to date medication reconciliation, instructions for follow up and

details of all of the important aspects of their recent stay in hand, to help make the transition

from hospital to home as seamless and less complicated as possible.

Our Diagnostic Imaging Clinical Team has secured the technology to enable onsite radiology,

which will pave the way to an expanded array of diagnostic imaging services. Expanded

ultrasound services, interventional procedures, PICC lines insertion and expanded hours of

mammography, are just a few examples. This group has also successfully developed a

business plan approved by both SECHEF and the South East LHIN for an in house CT

scanner at LACGH. This has now been submitted to the Ministry of Health and Long-Term

Care for final approval. These advances will create the opportunity for many patients when

they are at their most vulnerable to be treated closer to home. This expansion in our radiology

program will also be a boost for our emergency department, surgical program and our special

care unit.

Our Anesthetic and Surgical Clinical Team is in the process of updating and streamlining the

process of pre-surgical assessment to ensure that our patients are safely prepared for their

procedure with the most up to date evidence to minimize risks as well as information from the

Choosing Wisely Canada campaign which helps clinicians and patients engage in important

conversations about avoiding unnecessary tests. A positive patient experience includes the

right test, at the right time, no more and no less.

The family doctors of our community have joined together with our Hospital Board to create a

pilot “non-urgent rapid access” clinic to meet the needs of our patients who either cannot get to

their family doctor during regular “office” hours or for those in our community who do not have

a primary care provider at all and to try to take some of the burden off the emergency

department. This project had demonstrated some staggering statistics. 16 percent of patients

attending this clinic are residents of Lennox & Addington and are noted to have no family

doctor. At least 10 percent of the patients attending the clinic would have otherwise been

waiting in our Emergency Department for things that are best addressed by a primary care

provider. Patient satisfaction with this clinic has been overwhelmingly positive and has met an

enormous community need for after-hours care. The provincial “Patient’s First” legislation

empowers the LHINs to bring planning for primary care to the level of the sub-regions and it is

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hoped that we will be able to create opportunities to integrate the strengths of our primary care

leaders, our specialized Emergency Department physicians and our hospital administrative

infrastructure to meet the needs identified by our community. This would truly be an integrated

model of patient experience from home to hospital and back showcasing all that the Lennox

and Addington County General Hospital community has to offer.

Priority Area One – Patient Experience. Every concept we dream up, every business plan we

draft and every solution we network to achieve. After all, isn’t that what we are all here for?

Respectfully Submitted,

Dr. Kimberley Morrison

Chief of Staff

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Report from the President of

Volunteer Services

2016-2017 has been a huge learning experience for me as President of Volunteer Services

and I realize I still have much to learn.

Our volunteers this year have provided 11,774 hours of service – up about 1,000 hours from

last year.

While we know and understand change is the only constant in life, there are changes that will

always occur to cause us to stop, reflect and be grateful for. After more than 20 years Sharon

van Gent has stepped down as our Gift Shop Buyer. We are all very grateful for the years of

compassion, dedication and time Sharon has provided. Welcome to Tammy Giles, our new

Buyer-Coordinator and thank you for introducing a new look to our Shop.

We also thank Kees van Gent for his many years of managing and problem-solving the

H.E.L.P.P lottery function. And we thank Dave Coles for taking on this role. We appreciate that

Kees will continue to help out with the rest of the HELPP team.

It has been a year of learning for us with the Patient Kiosk being introduced to the Clinic,

Lobby and Triage areas. While technical glitches will always be a risk, Volunteer smiles and

assistance need always be there to smooth the ripples!

Our website has been updated with the expertise of Blaine Williams. I hope you have an

opportunity to take a look.

This year Volunteer Services is recognized as the primary donor for the KGH Dialysis Unit. A

food delivery system has been co-purchased and is providing our inpatients with more

palatable meals. Ten transport wheelchairs have also been purchased and made available in

Emergency and the Main Entrance to transport patients to and from their appointments.

The Hospital’s recent Volunteer Appreciation Dinner was wonderful: dinner delicious, service

impeccable, and musicians engaging. We appreciate all the work behind the scene – from

organizing, to cooking, to setting up and taking down. As evidenced by a room full of smiles,

volunteers did, indeed, feel appreciated.

Volunteers may now access the Hospital’s Fitness Centre, after submitting applications

(available in the Volunteer Services office) and completion of the access procedure.

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Finally, I extend my sincere appreciation for the support I have received this past year from

Hospital Staff, Administration, the Board of Governors and the Foundation who value our role

and are always there to help.

Sincerely,

Diane Airhart

President, Volunteer Services

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Report from the Chair of the

LACGH Foundation

It has been a privilege and honour to serve as Foundation Board Chair over the last year.

The past few years our organization has experienced a great amount of positive change.

Our service to our community and the growth in health services has been made possible by

the generosity of our community and especially by the joint efforts of our Hospital and

Foundation. The vision of our Hospital President and CEO Wayne Coveyduck, in concert

with our past Chair Robert Paul, have made an awesome team to foster the growth and

development of our Hospital and our Westdale and Lenadco properties. This past year, the

opening of the Acquired Brain Injury Facility and the Napanee location of the KGH Dialysis

Unit are the major highlights.

Thank You to our Executive Director Michelle Dickerson and all of the Foundation Board of

Directors for making my job exceedingly easy.

Sincerely,

Bob Vrooman Foundation Board Chair

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Report from the Chair of the

Nominating Committee

Article 4.8 of the Corporate By-law provides that a Director shall serve no more than a twelve year consecutive term.

With that in mind, Judge Geoffrey Griffin is no longer eligible to remain on the Board of Directors. In addition, Ms. Peggy Rice has decided it is time to resign her position as Director.

The enormous contribution of Ms. Peggy Rice must be acknowledged for she took on a significant amount of responsibility over the years, including being the Treasurer, the Vice Chair and five years as Chair of the Board.

All other existing Board members have chosen to remain on the Board of Directors, which is a testament to their commitment to ensure that Lennox and Addington County General Hospital continues to be a progressive hospital meeting the needs of our local communities.

The Nominating Committee is pleased to announce that the two Board members are:

1) Ms. Lori Frances who is a Regional Manager of Health Services for Correctional Services of Canada as well as being a Registered Nurse with a diploma in Business Administration and Finance will bring her knowledge and experience to the task. Ms. Francis is a long-time resident of Napanee where she has raised her three sons. She knows and cares very much for our community.

2) Mr. Robert Paul who has been away from the Board of Directors for a period of time but never away from working diligently for the betterment of our Hospital. It must be said that Mr. Paul has made it part of his life’s work to ensure that our Hospital continues to flourish. With his depth of knowledge about the Hospital’s development over the years and his continued willingness to work hard for its future the people of Lennox and Addington are in good hands.

All of which is respectfully submitted.

Geoffrey J. Griffin Chair, Nominating Committee

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Financial Statements of the

LACGH Association Year ending March 31, 2017

Financial Statements of

LENNOX AND ADDINGTON COUNTY GENERAL HOSPITAL ASSOCIATION

Year ended March 31, 2017

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LENNOX AND ADDINGTON COUNTY GENERAL HOSPITAL ASSOCIATION Financial Statements


Page

Independent Auditors' Report 1

Statement of Financial Position 3

Statement of Operations 4

Statement of Changes in Net Assets 5

Statement of Cash Flows 6

Statement of Remeasurement Gains and Losses 7

Notes to Financial Statements 8

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KPMG LLP Suite 400 Telephone (613) 549-1550 863 Princess Street Telefax (613) 549-6349 Kingston Ontario K7L 5N4 www.kpmg.ca Canada

INDEPENDENT AUDITORS' REPORT

To the Members of Lennox and Addington County General Hospital Association

We have audited the accompanying financial statements of Lennox and Addington County General Hospital

Association, which comprise the statement of financial position as at March 31, 2017, the statements of

operations, changes in net assets, cash flows and remeasurement gains and losses for the year then

ended, and notes, comprising a summary of significant accounting policies and other explanatory

information.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in

accordance with Canadian public sector accounting standards, and for such internal control as

management determines is necessary to enable the preparation of financial statements that are free from

material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted

our audit in accordance with Canadian generally accepted auditing standards. Those standards require that

we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about

whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the

financial statements. The procedures selected depend on our judgment, including the assessment of the

risks of material misstatement of the financial statements, whether due to fraud or error. In making those

risk assessments, we consider internal control relevant to the entity's preparation and fair presentation of

the financial statements in order to design audit procedures that are appropriate in the circumstances, but

not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit

also includes evaluating the appropriateness of accounting policies used and the reasonableness of

accounting estimates made by management, as well as evaluating the overall presentation of the financial

statements. KPMG LLP is a Canadian limited liability partnership and a member firm of the KPMG

network of independent member firms affiliated with KPMG International Cooperative

(“KPMG International”), a Swiss entity.

KPMG Canada provides services to KPMG LLP.

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We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our

audit opinion.

Opinion

In our opinion, the financial statements present fairly, in all material respects, the financial position of Lennox and

Addington County General Hospital Association as at March 31, 2017, its results of operations, its changes in net

assets, its cash flows and its remeasurement gains and losses for the year then ended in accordance with Canadian

public sector accounting standards.

Chartered Professional Accountants, Licensed Public Accountants

June 6, 2017

Kingston, Canada

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LENNOX AND ADDINGTON COUNTY GENERAL HOSPITAL ASSOCIATION Statement of Financial Position

March 31, 2017, with comparative information for 2016

2017 2016

Assets

Current assets: Cash $ 5,932,316 $ 5,795,444 Investments (note 4) – 425,419 Accounts receivable (note 2) 709,465 881,553 Ministry of Health and Long-Term Care

receivable 55,191 97,393 Note receivable (note 11(a)(ii)) 1,300,288 1,302,459 Inventories (note 3) 340,584 321,293 Prepaid expenses 289,135 312,179

8,626,979 9,135,740 Investments (note 4) 11,330,657 10,195,980 Capital assets (note 5) 31,591,116 32,471,562

$ 51,548,752 $ 51,803,282

Liabilities, Deferred Contributions and Net Assets

Current liabilities: Accounts payable and accrued liabilities (note 6) $ 2,784,893 $ 3,610,897 Agency obligation (note 12) 118,000 2,068,601

2,902,893 5,679,498 Liability for future employee benefits (note 7) 1,159,695 1,165,495 Deferred contributions (note 9) 23,916,502 24,517,923 Net assets:

Invested in capital assets (note 10(a)) 7,810,147 8,189,172 Reserve for future expenditures (note 14) 761,412 492,512 Unrestricted 13,256,458 10,808,235

21,828,017 19,489,919 Accumulated remeasurement gain 1,741,645 950,447

23,569,662 20,440,366 Contingent liability (note 13)

$ 51,548,752 $ 51,803,282

See accompanying notes to financial statements.

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LENNOX AND ADDINGTON COUNTY GENERAL HOSPITAL ASSOCIATION Statement of Operations Year ended March 31, 2017, with comparative information for 2016

2017 2016

Revenue: Ministry of Health and Long-Term Care $ 21,997,506 $ 20,290,467 Long-term care - convalescent care (note 17) 2,206,631 2,195,040 Other-patient revenue 1,354,802 1,380,451 Preferred accommodation 105,500 91,385 ALC co-payment 163,255 166,667 Cancer Care Ontario 1,409,471 1,568,034 Ambulance co-payment 66,036 67,185 Cafeteria services 73,527 63,223 Other revenue 567,097 459,904 Amortization of deferred contributions 579,061 629,371

28,522,886 26,911,727

Expenses: Salaries and wages 13,656,151 14,289,699 Medical staff remuneration 681,022 672,704 Benefits 2,624,135 2,622,373 Medical and surgical supplies 829,638 790,695 Drugs 1,419,454 1,411,498 Laboratory 901,573 893,235 Radiology and ultrasound 228,714 252,809 Other diagnostic and therapeutic 119,137 101,533 Administration, finance and human resources 513,530 482,581 System support 324,242 298,636 Dietary and food 166,765 176,952 Laundry 159,367 159,114 Housekeeping and material management 346,579 331,522 Plant operation 686,155 642,230 Plant maintenance 362,033 274,100 External buildings 1,057,060 1,325,799 Nursing 571,028 527,563 Convalescent care 377,566 371,071 Equipment amortization 639,836 733,985 Bad debts 16,699 45,687 Software amortization 371,901 339,683 Loss on disposal of capital assets 22,078 2,310

26,074,663 26,745,779

Excess of revenue over expenses before the undernoted 2,448,223 165,948

Capital activity: Amortization of deferred contributions 798,046 787,112 Investment income 208,196 180,181 Building amortization (1,056,444) (1,041,131) Other expenses (72,355) (67,197) Gain on disposal of investments 12,432 231,581 Shortfall on transfer of capital assets (note 11(a)(iii)) – (1,689,909)

(110,125) (1,599,363)

Excess (deficiency) of revenue over expenses $ 2,338,098 $ (1,433,415)


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LENNOX AND ADDINGTON COUNTY GENERAL HOSPITAL ASSOCIATION Statement of Changes in Net Assets Year ended March 31, 2017, with comparative information for 2016

Invested in Reserve

Capital for Future 2017 2016

Assets Expenditures Unrestricted Total Total

Balance, beginning of year $ 8,189,172 $ 492,512 $ 10,808,235 $ 19,489,919 $ 20,923,334

Excess (deficiency) of revenue over expenses (note 10(b)) (713,661) 603,536 2,448,223 2,338,098 (1,433,415)

Net change in investment in capital assets (note 10(b)) 334,636 (334,636) – – –

Balance, end of year $ 7,810,147 $ 761,412 $ 13,256,458 $ 21,828,017 $ 19,489,919


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LENNOX AND ADDINGTON COUNTY GENERAL HOSPITAL ASSOCIATION Statement of Cash Flows Year ended March 31, 2017, with comparative information for 2016

2017 2016

Cash provided by (used in):

Operating activities: Excess (deficiency) of revenue over expenses $ 2,338,098 $ (1,433,415) Items not involving cash:

Amortization of deferred contributions (1,377,107) (1,416,483) Amortization of capital assets 2,068,181 2,114,799 Loss on disposal of capital assets 22,078 2,310 Shortfall on transfer of capital assets – 1,689,909

3,051,250 957,120

Change in non-cash operating working capital: Ministry of Health and Long-Term Care receivable 42,202 42,631 Note receivable 2,171 (2,234) Accounts receivable 172,088 119,282 Inventories (19,291) (67) Prepaid expenses 23,044 27,245 Accounts payable and accrued liabilities (826,004) 96,113 Agency obligation (1,950,601) (162,917) Deferred revenue – (1,595) Employee future benefits (5,800) (400)

(2,562,191) 118,058

Capital activities: Proceeds on disposal of capital assets 509 2,590 Purchase of capital assets (1,210,322) (1,753,360) Additions to deferred contributions 775,686 884,768

(434,127) (866,002)

Investing activities: Purchase of investments (343,479) (917,651) Short-term investments 425,419 1,608,395

81,940 690,744

Increase in cash 136,872 899,920

Cash, beginning of year 5,795,444 4,895,524

Cash, end of year $ 5,932,316 $ 5,795,444


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LENNOX AND ADDINGTON COUNTY GENERAL HOSPITAL ASSOCIATION Statement of Remeasurement Gains and Losses Year ended March 31, 2017, with comparative information for 2016

2017 2016

Accumulated remeasurement gains, beginning of the year $ 950,447 $ 1,408,037

Unrealized gains (losses) attributable to:

Long-term investments: Designated fair value 791,198 (457,590)

Accumulated remeasurement gains, end of the year $ 1,741,645 $ 950,447


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LENNOX AND ADDINGTON COUNTY GENERAL HOSPITAL ASSOCIATION Notes to Financial Statements


The Lennox and Addington County General Hospital Association was incorporated under the Corporations Act of Ontario and its

principal activity is the provision of health services.

These financial statements present the financial position and results of operations of Lennox and Addington County General

Hospital Association (the “Association”), which is a registered charity under the Income Tax Act (Canada) and, accordingly, is

exempt from income taxes, provided certain requirements of the Income Tax Act (Canada) are met.

1. Significant accounting policies:

The financial statements have been prepared in accordance with Canadian public sector accounting standards including the

4200 standards for government not-for-profit organizations:

(a) Revenue recognition:

The Association follows the deferral method of accounting for contributions which include donations and government

grants.

Under the Health Insurance Act and Regulations thereto, the Association is funded primarily by the Province of Ontario in

accordance with budget arrangements established by the Ministry of Health and Long-Term Care. Operating grants are

recorded as revenue in the period to which they relate. Grants approved but not received at the end of an accounting

period are accrued. Where a portion of a grant relates to a future period, it is deferred and recognized in that subsequent

period. These financial statements reflect agreed arrangements approved by the Ministry with respect to the year ended

March 31, 2017.

Unrestricted contributions are recognized as revenue when received or receivable if the amount to be received can be

reasonably estimated and collection is reasonably assured.

Externally restricted contributions are recognized as revenue in the year in which the related expenses are recognized.

Contributions restricted for the purchase of capital assets are deferred and amortized into revenue on a straight-line basis,

at a rate corresponding with the amortization rate for the related capital assets.

Revenue from the Ontario Hospital Insurance Plan, in-patient and out-patient services, preferred accommodation and

marketed services and recoveries and other revenue is recognized when the goods are sold or the service is provided.

24

LENNOX AND ADDINGTON COUNTY GENERAL HOSPITAL ASSOCIATION Notes to Financial Statements (continued)


1. Significant accounting policies (continued):

(b) Capital assets:

Purchased capital assets are recorded at cost while contributed capital assets are recorded at fair value at the date of

contribution. When capital assets are abandoned or sold, their costs are removed from the accounts. Amortization is

recorded when the assets are put in use. Amortization of the building and building service equipment is recorded as an

expense of the capital fund while amortization of major equipment is recorded as an expense of the revenue fund.

Capital assets are amortized on a straight-line basis using the following annual rates:

Asset Rate

Land improvements 7% to 10% Building 3% to 9% Major equipment 4% to 33.3% Building service equipment 5% to 20% Software license 20% to 33.3%

Costs of construction in progress are capitalized. Amortization is not recognized until construction is complete and the

assets are ready for productive use.

(c) Volunteer services:

The work of the Association benefits from the voluntary services of many members of the community. Since these

services are not normally purchased by the Association and because of the difficulty of determining their fair value,

volunteer services are not recognized in these financial statements.

(d) Inventories:

Inventories are valued at lower of cost and net realizable value. Minor equipment is expensed in the year of acquisition.

(e) Employee future benefits:

The Association accrues its obligations for employee benefit plans. The cost of non-pension post-retirement and post-

employment benefits earned by employees is actuarially determined using the projected benefit method prorated on

service and management’s best estimate of salary escalation, retirement ages of employees and expected health care

costs.

25




(e) Employee future benefits (continued):

Actuarial gains (losses) on the accrued benefit obligation arise from differences between actual and expected experience

from changes in actuarial assumptions used to determine the accrued benefit obligation. The net accumulated actuarial

gains (losses) are amortized over the average remaining service period of active employees. The average remaining

service period of the active employees covered by the employee benefit plan is 13 years (2016 - 13 years).

Past service costs arising from plan amendments are recognized immediately in the period the plan amendments occur.

The Association is an employer member of the Healthcare of Ontario Pension Plan, which is a multi-employer, defined

benefit pension plan. The Association has adopted defined contribution plan accounting principles for this Plan because

insufficient information is available to apply defined benefit plan accounting principles.

(f) Financial instruments:

Financial instruments are recorded at fair value on initial recognition. Derivative instruments and equity instruments that

are quoted in an active market are reported at fair value. All other financial instruments are subsequently recorded at cost

or amortized cost unless management has elected to carry the instruments at fair value. Management has elected to

record all investments at fair value as they are managed and evaluated on a fair value basis.

Unrealized changes in fair value are recognized in the Statement of Remeasurement Gains and Losses until they are

realized, when they are transferred to the Statement of Operations.

Transaction costs incurred on the acquisition of financial instruments measured subsequently at fair value are expensed

as incurred. All other financial instruments are adjusted by transaction costs incurred on acquisition and financing costs,

which are amortized using the straight-line method.

All financial assets are assessed for impairment on an annual basis. When a decline is determined to be other than

temporary, the amount of the loss is reported in the Statement of Operations and any unrealized gain is adjusted through

the Statement of Remeasurement Gains and Losses.

When the asset is sold, the unrealized gains and losses previously recognized in the Statement of Remeasurement Gains

and Losses are reversed and recognized in the Statement of Operations.

26




(f) Financial instruments (continued):

Canadian public sector accounting standards require an organization to classify fair value measurements using a fair

value hierarchy, which includes three levels of information that may be used to measure fair value:

Level 1 - Unadjusted quoted market prices in active markets for identical assets or liabilities;

Level 2 - Observable or corroborated inputs, other than level 1, such as quoted prices for similar assets or

liabilities in inactive markets or market data for substantially the full term of the assets or liabilities; and

Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair

value of the assets and liabilities

(g) Use of estimates:

The preparation of financial statements requires management to make estimates and assumptions that affect the reported

amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements

and the reported amounts of revenue and expenses during the period. Actual results could differ from those estimates.

These estimates are reviewed periodically and as adjustments become necessary, they are reported in the periods in

which they become known.

2. Accounts receivable:

2017 2016

Amount receivable $ 746,465 $ 918,553 Less allowance for doubtful accounts 37,000 37,000

$ 709,465 $ 881,553

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3. Inventories:

The major classifications of inventories are:

2017 2016

Stores $ 89,171 $ 101,638 Laboratory 50,967 63,355 Pharmacy 200,446 156,300

$ 340,584 $ 321,293

4. Investments:

Level 2017 2016

Short-term investments:

Guaranteed investment certificates 1 $ – $ 425,419 Equity instruments, quoted in an

active market: Shares 1 2,598,369 2,219,424 Mutual funds 1 8,732,288 7,976,556

11,330,657 10,195,980

$ 11,330,657 $ 10,621,399

There were no transfers between Level 1 and Level 2 for the years ended March 31, 2017 and 2016. There were also no

transfers in or out of Level 3.

5. Capital assets:

2017 2016 Accumulated Net book Net book

Cost amortization value value

Land and land improvements $ 694,226 $ 166,866 $ 527,360 $ 562,815 Building 36,574,120 10,742,267 25,831,853 26,461,764 Major equipment 12,564,338 9,734,857 2,829,481 2,913,764 Building service equipment 2,975,756 1,609,970 1,365,786 1,348,439 Software license 5,508,038 4,471,402 1,036,636 1,184,780

$ 58,316,478 $ 26,725,362 $ 31,591,116 $ 32,471,562

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5. Capital assets (continued):

Cost and accumulated amortization of capital assets at March 31, 2016 amounted to $57,344,057 and $24,872,495,

respectively.

6. Accounts payable and accrued liabilities:

Included in accounts payable and accrued liabilities are government remittances payable of $240,037 (2016 - $247,350), which

includes amounts payable for WSIB and payroll-related taxes.

7. Employee future benefits:

The Association provides extended health care, dental and life insurance benefits to certain past employees. An independent

actuarial study of the post-retirement and post-employment benefits has been undertaken. The most recent valuation of the

employee future benefits was completed as at April 1, 2015. The next valuation of the plan will be effective April 1, 2018.

The significant actuarial assumptions adopted in estimating the Association’s accrued benefit obligation are as follows:

Discount rate - expense 3.25% Discount rate - disclosure 3.30% Dental benefits escalation 3.00% Health benefits escalation 6.25% in 2017; decreasing by 0.25% per annum to an ultimate rate of 4.5%

The continuity of the Association’s accrued benefit liability is as follows:

2017 2016

Accrued benefit liability, opening balance $ 1,165,495 $ 1,165,895 Current service costs 35,700 36,000 Interest on accrued benefit obligation 23,600 21,900 Benefits paid for the period (27,600) (23,400) Amortization of actuarial gains (37,500) (34,900)

Accrued benefit liability, closing balance $ 1,159,695 $ 1,165,495

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7. Employee future benefits (continued):

Accrued benefit liability at March 31, includes the following components:

2017 2016

Accrued benefit obligation $ 728,400 $ 705,200 Unamortized actuarial gains 430,300 459,300 Sick bank 995 995

$ 1,159,695 $ 1,165,495

8. Pension plan:

Substantially all of the full-time and some part-time employees of the Association are members of the Healthcare of Ontario

Pension Plan. Contributions to the plan made during the year by the Association on behalf of its employees amounted to

$990,975 (2016 - $939,164) and are included in employees’ benefits in the Statement of Operations. The Healthcare of Ontario

Pension Plan’s most recent annual report states that the plan has a regulatory surplus of $11,960 million as at December 31,

2016.

9. Deferred contributions related to capital assets:

Deferred contributions reported in the Statement of Financial Position include the unamortized portion of deferred contributions

with which some of the Association’s capital assets were originally purchased. The amortization of deferred contributions is

recorded as revenue in the Statement of Operations. Changes for the year in deferred contributions are as follows:

2017 2016

Balance, beginning of year $ 24,517,923 $ 29,424,638 Additional contributions during the year 775,686 884,768

25,293,609 30,309,406 Amounts amortized to revenue during the year (1,377,107) (1,416,483) Amounts amortized to revenue on transfer of

capital assets (note 11(a)(iii)) – (4,375,000)

Balance, end of year $ 23,916,502 $ 24,517,923

30



9. Deferred contributions related to capital assets (continued):

The balance of unamortized and unspent funds consists of the following:

2017 2016

Unamortized capital contributions used

to purchase assets $ 23,780,969 $ 24,282,390 Unspent capital contributions 135,533 235,533

$ 23,916,502 $ 24,517,923

10. Invested in capital assets:

(a) The investment in capital assets is calculated as follows:

2017 2016

Capital assets $ 31,591,116 $ 32,471,562

Amounts financed by: Deferred contributions 23,780,969 24,282,390

Balance, end of year $ 7,810,147 $ 8,189,172

(b) The change in investment in capital assets is calculated as follows:

2017 2016

Deficiency of revenue over expenses:

Amortization of capital assets $ (2,068,181) $ (2,114,799) Amortization of deferred contributions 1,377,107 1,416,483 Shortfall on transfer of capital assets – (1,689,909) Loss on disposal of capital assets (22,078) (2,310) Proceeds on disposal of capital assets (509) (2,590)

$ (713,661) $ (2,393,125)

Net change in investment in capital assets:

Purchase of capital assets $ 1,210,322 $ 1,753,360 Amounts funded by deferred contributions (875,686) (788,603)

$ 334,636 $ 964,757

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11. Related entities:

(a) Lennox and Addington County General Hospital Foundation:

The Association has entered into a fundraising/public relations arrangement with the Lennox and Addington County

General Hospital Foundation (the “Foundation”). The Foundation has been established to encourage and to co-ordinate

the continuing high level of community financial support to meet the long-term capital financing needs of the Association.

In accordance with this arrangement, donations received by the Association are transferred to the Foundation for the

purpose of interim investment and management. The Association has economic interest, but not control, in the Lennox

and Addington County General Hospital Foundation.

Related party transactions during the year not separately disclosed in the financial statements include the following:

(i) The Association received amounts totaling $179,572 (2016 - $119,044) that have been contributed from the

Foundation, which are recorded as deferred contributions to be used to fund the purchase of capital assets.

(ii) The Association has a note receivable from the Foundation in the amount of $1,300,000, bearing interest at a 2%

annual rate, and due on demand.

(iii) In April 2015, the Association transferred the ownership of two buildings with a net book value of $6,064,909 to the

Foundation for total cash consideration of $1. Deferred contributions of $4,375,000 were also brought into income at

this time. During the year, a further investment in those buildings has been made in the amount $3,162,813 (2016 -

$3,246,331) using Association funds of $1,177,955 (2016 - $2,266,516), Agency obligation funds of $1,866,666

(2016 - $979,815) and donations of $118,192 (2016 -$Nil).

(b) Lennox & Addington County General Hospital Volunteer Services:

The Lennox & Addington County General Hospital Volunteer Services raises funds through various volunteer services.

The Association received amounts totaling $44,894 (2016 - $120,000) that have been contributed from Volunteer

Services, which are recorded as deferred contributions to be used to fund the purchase of capital assets. The Association

has economic interest, but not control, in the Lennox & Addington County General Hospital Volunteer Services.

32



11. Related entities (continued):

(c) Kingston Regional Hospital Laundry Incorporated:

Kingston Regional Hospital Laundry Incorporated, a corporation incorporated under the laws of the Province of Ontario,

provides laundry services, linen replacement, uniforms and other related laundry services to the five hospitals in the

Kingston region. The Association exercises significant influence, but not control, over Kingston Regional Hospital Laundry

Incorporated.

Kingston Regional Hospital Laundry Incorporated provides laundry services to the Association based on rates reflecting

the costs, expenses and disbursements incurred by them in the normal course of business relating to the provision of

laundry services. The Association contributes toward approved capital improvements and replacement costs incurred by

Kingston Regional Hospital Laundry Incorporated. During the year, the Association paid $190,626 (2016 - $190,668) to

Kingston Regional Hospital Laundry Incorporated for laundry services.

(d) Shared Support Services South Eastern Ontario:

The Association is a member of a group of seven hospitals with the South East Local Health Integration Network which

have voluntarily agreed to enter into a joint project for the purposes of planning, development, implementation and

operation of a shared regional supply chain project, consisting of procurement, warehousing, logistics and contract

management activities. Shared Support Services South Eastern Ontario (‘3SO”), a not-for-profit corporation, has been

created to manage the services and provide procurement oversight on the part of the member hospitals. The project

received start-up funding from the Ministry of Finance. The four-year project implementation period commenced with the

signing of a transfer payment agreement in March 2008 and was completed in 2012.

Each of the participating hospitals is a voting member of 3SO. Therefore, the Association has an economic interest, but

not control, over 3SO. The assets, liabilities, net assets and results of operations of the 3SO are not included in the

financial statements. During the year, the Association incurred costs of $196,825 (2016 - $185,272) to 3SO for

governance/ operating costs. These costs are included in supplies and other expenses on the Statement of Operations.

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12. Agency obligation:

The Association acts as an agent which holds resources and makes disbursements on behalf of the South East Local Health

Integration Network for a variety of programs. Each of these programs represent activities that are not specific to this

Association. The Association has no discretion over such agency transactions. Resources received in connection with such

agency transactions are reported as liabilities, not revenue, and subsequent distributions are reported as decreases to these

liabilities.

2017 2016

Agency obligation, beginning of the year $ 2,068,601 $ 2,231,518 Funds received during the year – 1,307,685 Funds disbursed during the year (1,950,601) (1,470,602)

Agency obligation, end of year $ 118,000 $ 2,068,601

13. Contingent liability:

The nature of the Association’s activities is such that there is usually litigation pending or in prospect at any time. With respect

to claims at March 31, 2017, management believes the Association has valid defenses and appropriate insurance coverage in

place. In the event any claims are successful, management believes that such claims are not expected to have a material

effect on the Association’s financial position.

14. Reserve for future expenditures:

The reserve for future expenditures represents internally restricted funds which the Board has set aside to fund future

expenditures at their discretion.

34



15. Financial risks and concentration of credit risk:

(a) Credit risk:

Credit risk refers to the risk that a counter party may default on its contractual obligations resulting in a financial loss. The

Association is exposed to credit risk with respect to the accounts receivable, cash and investments.

The Association assesses, on a continuous basis, accounts receivable and provides for any amounts that are not

collectible in the allowance for doubtful accounts. The maximum exposure to credit risk of the Association at March 31,

2017 is the carrying value of these assets.

The carrying amount of accounts receivable is valued with consideration for an allowance for doubtful accounts. The

amount of any related impairment loss is recognized in the Statement of Operations. Subsequent recoveries of

impairment losses related to accounts receivable are credited to the Statement of Operations. The balance of the

allowance for doubtful accounts at March 31, 2017 is $37,000 (2016 - $37,000).

As at March 31, 2017, $10,733 (2016 - $5,901) of trade accounts receivable were past due, but not impaired.

The Association follows an investment policy approved by the Board of Directors. The maximum exposure to credit risk of

the Association as at March 31, 2017 is the carrying value of these assets.

There have been no significant changes to the credit risk exposure from 2016.

(b) Liquidity risk:

Liquidity risk is the risk that the Association will be unable to fulfill its obligations on a timely basis or at a reasonable cost.

The Association manages its liquidity risk by monitoring its operating requirements. The Association prepares budget and

cash forecasts to ensure it has sufficient funds to fulfill its obligations.

Accounts payable and accrued liabilities are generally due within 60 days of receipt of an invoice.

There have been no significant changes to the liquidity risk exposure from 2016.

(c) Market risk:

Market risk is the risk that changes in market prices, such as foreign exchange rates or interest rates will affect the

Association’s revenue or the value of its holdings of financial instruments. The objective of market risk management is to

control market risk exposures within acceptable parameters while optimizing return on investment.

35



15. Financial risks and concentration of credit risk (continued):

(c) Interest rate risk:

Interest rate risk is the risk that the fair value of future cash flows or a financial instrument will fluctuate because of

changes in the market interest rates.

Financial assets and financial liabilities with variable interest rates expose the Association to cash flow interest rate risk.

There has been no change to the interest rate risk exposure from 2016.

16. Diabetes Education Program:

The South East Local Health Integration Network (“South East LHIN”) funded $295,515 (2016 - $295,515) for the Diabetes

Education Program. Ministry of Health and Long-Term Care revenue includes funding in the amount equal to expenses for the

Diabetes Education Program. The expenses for this program totaled $252,528 during the year (2016 - $236,689) for salaries,

supplies and sundry expenses and a transfer to Hotel Dieu Hospital of $69,789 (2016 - $69,102) to administer their portion of

the Diabetes program.

17. Long-term care - convalescent care:

2017 2016

Interim long-term care beds

Revenue: Contributions - South East Local

Health Integration Network $ 2,206,631 $ 2,195,040 Other 1,577 –

2,208,208 2,195,040

Expenses: Nursing and personal care 1,342,394 1,327,828 Program and support services 349,496 346,587 Raw food 73,706 78,036 Other accommodations 773,344 725,150 Amortization (net) 48,048 50,470

2,586,988 2,528,071

Deficiency of revenue over expenses $ (378,780) $ (333,031)

36



18. Hospice Lennox & Addington:

The South East LHIN funded $78,508 (2016 - $89,283) for Hospice Lennox & Addington. These funds are transferred to

Hospice Lennox & Addington to administer the program and are not included in the Statement of Operations.

19. Comparative information:

Certain comparative information has been reclassified to conform with the financial statement presentation adopted in the

current year.

37

MISSION

To be a progressive hospital meeting

the needs of our local communities

through our people.

VISION

To be a recognized healthcare provider

of choice, a good employer and

a valued community partner.

VALUES

Teamwork, Respect and

Communication

Lennox and Addington County General Hospital

8 Richmond Park Drive, Napanee, ON K7R 2Z4

Phone: (613) 354-3301 Fax: (613) 354-7175

annual report 2016-2017 - lacghweb.lacgh.napanee.on.ca/uploads/annual report june 13 2017 -...

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