For its first full fiscal year, Santé Québec achieved a balanced budget. Its financial results show that it has $34 million remaining, out of a budget of $46 billion, representing 0.07 per cent of total expenditures for the 2025-2026 fiscal year.
How did the Crown corporation go from a colossal healthcare deficit to a balanced budget?
The task was daunting. Santé Québec published a first assessment of its financial statements last year, but it was partial, since it had operated the health and social services network for only four months, from December 1, 2024 to March 31, 2025.
In the fall of 2024, the network’s projected deficit was estimated at $1.5 billion. During its first four months in operation, Santé Québec managed to generate savings of $750 million. The Crown corporation ended with a deficit of $1.8 billion due to increased activity volumes.
In its figures, Santé Québec refers to an operating deficit of $240 million for the 2024-2025 fiscal year, as it excludes amounts related to the transfer of liabilities from the facilities and the amount allocated to cover the additional costs associated with increased volumes. “There are four months for the facilities and eight months for head office, because Santé Québec was established before the merger of the facilities, so it’s a little difficult to analyze,” admits Sonia Dugas, Vice-President of Finance at Santé Québec.
Overall, she says she is very proud of the teams’ efforts to achieve a balanced budget. To achieve this, Dugas explains that the institutions had targets to meet, established according to provincial averages. “We integrated the concept of financial performance, and that’s the measure that paid off,” she says.
A 5 per cent reinvestment for those who perform better
Santé Québec has eliminated the historical benchmarks that were renewed annually for institutions. Dugas explains how performance is now linked to the budget.
For each sector—for example, surgery, youth protection, emergency services—their unit cost was determined. Each sector has a unit of measurement for how volume is calculated, for example, the number of surgeries in the operating room or the number of visits to the emergency room.
Each institution has areas where it performs better and others where it performs worse. For the underperforming areas, Santé Québec asked institutions to reduce the gap with the provincial average by 50 per cent.
“What we did with zero-based budgeting — and this was the first revolution — for each activity centre, we established the provincial average. If I, as an establishment, cost more than the provincial average, I was asked to do half the work, so to compensate for half the difference. For example, […] my unit cost is $150, the provincial average is $100, I am asked to bring it down to $125,” explains Dugas.
Santé Québec lowered the requested reduction to 35 per cent when the unit of measurement was the user, because this does not take into account the severity of the cases.
Another new feature implemented by Santé Québec: for sectors where establishments perform better than the provincial average, there is a reinvestment of 5 per cent of the difference in order to promote innovation and reward good practices.
While some may find it insufficient, Dugas points out that Santé Québec started with “some financial challenges.” For the vice-president, this incentive is largely symbolic. “It’s really about saying, ‘We recognize financial efficiency,’” she says.
Specific features to consider
In the end, 80 per cent of the high-potential sectors identified by Santé Québec succeeded in improving their unit cost or keeping it below inflation.
However, by requiring all institutions to strive towards the provincial average, several inequities risked emerging. An institution on the North Shore is not managed in the same way as one in an urban centre.
Dugas assures that this variable was taken into account. She explains that this is why Santé Québec did not ask institutions to completely close the gap with the provincial average. “These would sometimes have been unattainable objectives, either for remote regions, for highly specialized missions, or for institutions with specific characteristics in a given sector,” she acknowledges.
For the second year of the budget, Santé Québec wants to refine its model to better take these particularities into account.
Among the other measures that helped achieve a balanced budget, Santé Québec reduced administrative expenses from 4.5 per cent of total expenditures to 4.2 per cent. Furthermore, to provide greater predictability for healthcare facilities, their annual budgets were confirmed at the beginning of the fiscal year, whereas previously 20 per cent of the budget was communicated to facilities during the year in the form of letters.
Furthermore, Santé Québec is unable to confirm that there have been no job cuts. As part of a resource optimization effort, it indicates that employees may be reassigned elsewhere within their facility or the network, in accordance with collective agreements.
—The Canadian Press’s health coverage is supported by a partnership with the Canadian Medical Association. The Canadian Press is solely responsible for this journalistic content.
–This report by La Presse Canadienne was translated by CityNews
