Ontario’s 2026 Healthcare Budget: Primary Care Focus, Hospital Funding Gap

Ontario’s 2026 healthcare budget prioritizes primary and home care expansion but falls short in addressing hospital funding needs, according to an analysis by Medscape.

The provincial government is allocating an additional $325 million through the 2026 budget to advance its Primary Care Action Plan, which aims to connect every Ontarian to a family doctor or primary care team by 2029. When combined with ongoing funding, this brings the four-year investment in the plan to $3.4 billion.

This funding supports initiatives launched in January 2025 under the Primary Care Action Plan, led by Dr. Jane Philpott, which has already attached approximately 330,000 people to ongoing primary care during the 2025–26 period and reduced the Health Care Connect waitlist by over 87% as of spring 2026.

The plan targets the approximately 1.9 million Ontarians who currently lack access to a primary care provider, with the goal of closing this gap through team-based care models and expanded community health services.

However, despite these investments in community-based care, the budget does not adequately address hospital care spending requirements. Ontario continues to fund hospitals at the lowest per capita rate in the country, at $1,805 per person—below the national average of $1,949—and ranks second lowest for overall healthcare sector funding at $5,268 per person, compared to the national average of $5,562.

These funding levels contribute to ongoing strain on the public health system, including overcrowded hospitals and the prevalence of hallway medicine, as the province struggles to maintain service levels amid population growth and aging.

The Financial Accountability Office of Ontario estimates that $6.4 billion in new spending is required in 2026–27 just to maintain 2024–25 service levels, yet the 2026 budget provides only $3.4 billion in additional health sector funding, leaving a $3 billion shortfall for the upcoming fiscal year.

This gap is projected to widen in subsequent years, with $9.6 billion needed in 2027–28 to sustain current service levels, while the budget allocates only $2.3 billion—resulting in a $7.3 billion funding gap.

Analysts warn that persistent underfunding of public healthcare may drive increased reliance on private-pay services, as provincial austerity measures benefit privately financed healthcare options while public institutions face resource constraints.

While the Primary Care Action Plan has shown early success in exceeding attachment targets and reducing waitlists, experts emphasize that long-term system sustainability will require balanced investment across both community and hospital-based care to meet the full spectrum of Ontarians’ health needs.