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Proposed Regulation Changes would Permit LHINs and Cancer Care Ontario to Fund Community-Based Specialty Clinics

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Health Law Bulletin

On August 12, 2013, the Ministry of Health and Long-Term Care (the “Ministry”) posted two proposals to the Regulatory Registry website[1] for regulation changes that together are aimed at facilitating funding of Community-Based Specialty Clinics by Local Health Integration Networks (“LHINs”)[2] and Cancer Care Ontario (“CCO”) [3].

In January 2012, the Ministry released its Action Plan for Health Care which included, among other things, a commitment to move certain surgical procedures out of hospitals and into so-called “Community-Based Specialty Clinics”. To date, no procedures have been moved out of hospitals and how such Community-Based Specialty Clinics would be funded has been a lingering question. The Ministry is now proposing regulation changes that would allow the Ministry to create a model whereby Community-Based Specialty Clinics may be granted an Independent Health Facility (“IHF”) licence under the Independent Health Facilities Act (Ontario) (the “IHFA”) and  funded directly by a LHIN (or CCO if it was providing cancer-related services). Under the existing legislative regime only the Ministry may fund IHFs in respect of services rendered to persons insured under the Health Insurance Act (Ontario).

The Proposed Regulation Changes

The Ministry is proposing amendments to O. Reg. 264/07 made under the Local Health System Integration Act, 2006 (Ontario) (the “LHSIA”) and the creation of a new regulation under the IHFA.[4]

Section 19(1) of the LHSIA permits the Ministry to fund a “health service provider in respect of services that the service provider provides in or for the geographic area of the network.” Section 2(2) of the LHSIA sets out 11 categories of “health service provider” including, at paragraph 11, “Any other person or entity or class of persons or entities that is prescribed.”[5]  The Ministry is proposing to amend Regulation 264/07 such that IHFs will be prescribed as “health service providers” under the LHSIA which would permit LHINs to fund IHFs. 

Section 3(3) of the IHFA states that:

No person shall charge a facility fee, or accept payment of a facility fee, for or in respect of a service provided to an insured person in an independent health facility operated by a person licensed under this Act, unless the fee is charged to, or the payment is received from, the Minister [of Health and Long-Term Care] or a prescribed person. [emphasis added]

The Ministry has proposed adding LHINs and CCO as “prescribed persons” under the IHFA to provide certainty regarding their entitlement to pay amounts to an IHF that could constitute facility fees.


If the regulatory changes are ultimately approved, the Ministry will have the option of issuing IHF licences to Community-Based Specialty Clinics and having those clinics funded through the payment of facility fees by the LHIN in which the IHF is geographically located or CCO if cancer-related services are being provided.[6] 

The regulatory changes are meant to come into effect concurrently.  Comments on the postings may be submitted on the Regulatory Registry website until October 11, 2013.  No draft regulations will be released as part of the consultation process. Based on this timing, it seems likely that the earliest the Ministry will begin the process to transfer procedures from hospitals to Community-Based Speciality Clinics would be late 2013 or early 2014.

For more information please contact the authors.



[2]       LHINs are created under the Local Health Systems Integration Act, 2006 (Ontario) and currently provide funding to public hospitals, private hospitals and certain other health service providers within specified geographic regions.

[3]       Cancer Care Ontario currently oversees in excess of $800M in funding for hospitals and other providers of cancer care services.

[4]       It appears that the posting proposes to create a new regulation under the IHFA. It would also be possible to accomplish this change through an amendment to one of the existing regulations made under the IHFA.

[5]       For the purposes of the LHSIA “prescribed” means prescribed by the regulations.

[6]       Section 5(1) of the IHFA requires the Ministry to issue an RFP (either broadly or directed) prior to issuing an IHF licence.


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