[Updated with videos] Minister of Health Zane Desilva and Minister of Youth, Families & Sports Glenn Blakeney held a joint press conference this morning [Feb.28], to discuss their Ministry’s respective budgets for the upcoming fiscal year.
The proposed 2012/13 budget for the Ministry of Health is $190.98 million, a 10.9% increase from last year. The Hospitals account for $142.6 million, or almost 75%, of the total health budget. The remaining 25%, or $48.4 million, is allocated to the Ministry Headquarters, the Department of Health, and Health Insurance Department.
Minister Desilva said, “For the first time ever, the Ministry of Health and the Bermuda Hospitals Board will be entering into a Memorandum of Understanding to cap the Hospital Subsidy.”
“If we put a cap on Subsidy, we will be able to budget. We will know exactly what our maximum liability will be for Hospital subsidy. If we agree to a cap of $104 million, the most that we will pay will be $104 million. We could pay less, but not more.
“A cap will also put pressure on the Hospital to control their costs and to actively manage utilization of testing and diagnostic imaging. Patient safety would not be compromised, but every test does not have to be run for every patient.”
The Youth, Families & Sports budget is $75.3 million, with $39.8 million allocated to Financial Assistance, $18.6 million to Child and Family Services, $12 million to Youth, Sport and Recreation, $2.3 million to Human Affairs and $2.45 million to the Ministry’s headquarters.
The Ministry Headquarters’ budget of $2.45 million is a reduction of 34% from $3.7 million last year. “Part of the decrease in the Ministry Headquarters budget is due to a reduction in the Mirrors Programme budget from $1.69 million in FY 2011-12 to $1.3 million in FY 2012-13, a decrease of $392,000 or 23%,” said Minister Blakeney.
The Ministry added approximately $1 million to the budget estimate for the Department of Child and Family Services for the Psycho-Educational Programme.
Minister Blakeney said, “The Ministry had reduced the Psych-Ed budget last year by the same amount, but has found that there is still a continuing need to place children overseas for treatment. The Ministry will continue to search for viable ways to reduce the cost of overseas treatment going forward.”
The Ministry has also been allocated approximately $400,000 to support the Lime Carifta Games, which Bermuda will host at the National Sports Centre from April 6-9, 2012.
Minister Desilva’s full statement follows below:
Thank you for joining me today.
I’d like to take a few minutes to provide more detail on the Ministry of Health budget for the 2012/13 financial year.
I’ll tackle both the Current Account budget and the Capital Development budget.
First, on the Current Account side, the proposed 2012/13 budget for the Ministry of Health is $190.98 million which is a 10.9% increase on the base budget from the previous year.
All of this increase has been applied to the budget for the Hospital Subsidy, as the Subsidy has historically been under funded.
The Ministry of Health provides funding to three Government entities:
- The Ministry of Health Headquarters;
- The Department of Health; and
- The Health Insurance Department.
In addition, the Ministry pays claims made against the Hospital Subsidy and provides an operating grant to the Mid-Atlantic Wellness Institute.
The vast majority of the Ministry of Health’s budget (almost 75%) is allocated to the Bermuda Hospitals Board.
The grant to MWI is $38.578 million and funds the full operation of the Mid Atlantic Wellness Institute.
The team at MWI will continue with the implementation of the Mental Health Plan during the coming financial year, and they will also be working closely with the Department of Health on the provision of services for Bermuda’s special needs population.
I indicated that the Ministry of Health pays claims made against the Hospital Subsidy, and I think it’s important to spend just a moment explaining the Subsidy.
There are three Hospital Subsidy categories which are designed to protect vulnerable populations.
For CHILDREN and the INDIGENT, the Subsidy pays 100% of standard hospital benefit – which is the cost of services provided at KEMH by KEMH staff.
For SENIORS between the ages of 65 and 75, the Subsidy pays 80% of standard hospital benefit.
For SENIORS over the age of 75, the Subsidy pays 90% of standard hospital benefit.
Again, I have to stress that these subsidies apply to ALL Bermuda residents. The Subsidies for Children and Seniors are age based entitlements which are not means tested, either at the low or high end. No matter how little or how much one earns, the Subsidies pay for hospital care.
As we all know, no matter where you live, the cost of healthcare is highest at the Hospital – and it’s no different in Bermuda.
We have budgeted $104 million for Hospital Subsidy.
Historically, the Hospital Subsidy has been paid on a ‘fee for service’ basis. If a patient who is eligible for subsidy receives service, the Ministry pays. This has meant that the Ministry of Health had no control over the budget. If more people used more services, the Ministry paid. Also, there was no incentive for the Hospital to control utilization.
That is now changing.
For the first time ever, the Ministry of Health and the Bermuda Hospitals Board will be entering into a Memorandum of Understanding to cap the Hospital Subsidy.
If we put a cap on Subsidy, we will be able to budget. We will know exactly what our maximum liability will be for Hospital subsidy.
If we agree to a cap of $104 million, the most that we will pay will be $104 million.
We could pay less, but not more.
A cap will also put pressure on the Hospital to control their costs and to actively manage utilization of testing and diagnostic imaging. Patient safety would not be compromised, but every test does not have to be run for every patient.
The Hospitals then, account for $142.6 million, or almost 75%, of the total budget for the Ministry of Health.
The remaining 25% or $48.4 million is allocated to the Ministry Headquarters, the Department of Health, and Health Insurance Department.
In 2012/13, the primary focus for the Departments within the Ministry of Health will be the National Health Plan.
Each of the Departments are heavily involved in the six Task Groups which are developing the implementation options for the National Health Plan.
The Benefit Design Task Group has submitted their preliminary recommendations on the benefits which should be included in the Standard Health Benefit.
The Finance and Reimbursement Task Group will use the Benefit Design Group’s report to develop options for pricing and paying for health coverage.
The Prevention Task Group is already at work on enhancing the implementation of the Well Bermuda Strategy. Long term, the only way to keep our rising healthcare costs in check is to change our eating and exercise habits. We must strive for Healthy People, Healthy Families, living in Healthy Communities.
The other Task Groups are focusing on Long Term Care, Overseas Care, and the implementation of an Electronic Health Record. It will be some time before they have all completed their work, but they are all active and have involved as wide a cross section of the stakeholder community as possible.
In the end, we will not lose sight of the core values that we have set for our heath system – equity and sustainability.
While the National Health Plan is looking toward the long term, the Ministry of Health is also focused on the short term.
The 2011 Throne Speech announced that we would be addressing the matter of upfront payments for medical treatment. Resources have been allocated for this project within the Ministry of Health and the Bermuda Health Council.
Legislation was produced and laid before the House of Assembly during the last session for the information of the Members as well as the public at large.
The implementation team (which includes a broad range of stake holders) has been meeting to suggest fine tuning that the legislation might require. They have also been working out the technical details of implementation. Putting a halt to upfront payments may sound like a straight forward exercise, but, as they say, “The Devil is in the details.”
Now, let me turn to the Capital Development funding.
There are only two Capital Development items in the budget for the Ministry of Health.
Each year we provide $120,000 to MWI for Minor Works, and that is in place again for next year.
We also have $1 million in Capital Development funding for the refurbishment of Lefroy House.
At this point, I have to pause and provide a bit of background, because one of the OBA candidates has recently been making a lot of noise about the Capital funding for Lefroy House.
A couple of weeks ago, I was asked if the OBA candidate for the Lefroy House constituency could visit Lefroy, as he would like to be familiar with the care provided there.
I didn’t have a problem with that, and I went with him to Lefroy House where the Administrator gave us a comprehensive tour.
She showed us the whole facility, from top to bottom. We met staff and we had the chance to talk to residents. Nothing was hidden, and nothing was off limits. The candidate could see anything he wanted to see.
After the visit, I understand that this candidate appearedon talk radio about the conditions at Lefroy House. I also understand that he has been implying that funding has been used for other purposes – and he’s right. His indications are wrong – let me explain:
This financial year we had $5.5 million in the budget for Lefroy House refurbishment, but we had to transfer funds as follows:
- $1 million was transferred to the LCCA to pay for the cost of overseas hospital treatment for Bermudians;
- $2 million was transferred to the Health Insurance Department to assist in the payment of subsidy for portability and age subsidy for diagnostic imaging. And remember, this is in addition to the $104 million for Hospital Subsidy claim payments that I talked about earlier; and
- $2.4 million was deferred as part of a cost savings exercise for this financial year.
I have to be clear that the total funding approved by Parliament for the Lefroy House refurbishment project is $19 million – but that $19 million has not been put into the budget in any one year.
Each year, part of the funding is provided, and to date (between 2007 and now) we have only spent $1.5 of that $19 million.
We will continue to work on the redevelopment of Lefroy House, but we also have to look at the long term return on investment.
I have asked my technical team to provide me with a comparison of what can be accomplished by refurbishment against what could be done if we started from scratch.
We have to consider all the options – but my focus continues to be on what is best for the seniors who live at Lefroy House – not just in the short term, but also for the long term.
Minister Blakeney’s full statement follows below:
Good Morning, I am pleased to share with members of the media and the public highlights of the Ministry of Youth, Families and Sports’ Budget Estimate for Fiscal Year 2012-13. The total budget estimate for the Ministry is broken down as follows:
The Government recognizes that there is a continuing need to provide assistance to members of our community who find themselves in a financial deficit in their day to day lives. Accordingly, the budget estimate for the Department of Financial Assistance (including child day care allowance) for FY 2012-13 is $39.8 million.
This is the primary reason that the Ministry’s budget allocation this year (i.e. FY 2012-13) shows a 21% increase over the original budget estimate for FY 2011-12.
This allocation more accurately reflects projections for financial assistance demand and will provide the Ministry with the necessary resources to meet the projected demand, particularly with regards to seniors and persons with disabilities.
There is also expected to be some increase in demand due to persons who are recently unemployed seeking financial assistance. The Ministry objective in this regard is to avoid people falling through the cracks when they find themselves in a financial deficit situation.
Let me summarize the recent statistics for persons on financial assistance and child day care allowance for the month of December 2011:
- # of persons on financial assistance – 1363
- # of seniors – 522; # of persons with disabilities – 523; # of persons with low earnings – 188; # of able-bodied unemployed persons – 130
- 21% of seniors on financial assistance live in a rest or nursing home.
- average caseload per financial assistance worker – 143
- number of parents receiving child day care allowance – 300
- number of children in child day care allowance programme – 359.
Amendment to Financial Assistance Regulations 2004
The Ministry is aware that some of our seniors are experiencing financial hardship because they are ineligible to receive financial assistance benefits due to the fact that they are property owners. The November 2011 Speech from the Throne indicated that Government would review the eligibility criteria for financial assistance in order to ensure that the mere fact of home ownership by seniors does not justify denial of financial assistance.
Let me explain further. Amendments to the Financial Assistance Regulations 2004 came into effect on the 1st April 2011 and changed eligibility criteria such that any applicant with assets (inclusive of interest in real property) exceeding $5,000.00 would not be eligible to receive financial assistance.
It has been observed since that time that the amendment to the Financial Assistance Regulations had an adverse impact on seniors who are homeowners or who have an interest in real property, even though it was not intended to disadvantage such persons.
Consequently, Government will amend the Financial Assistance Regulations in this Parliamentary session to allow seniors who are homeowners or who have an interest in real property to be eligible to be assessed for applicable financial assistance benefits.
It is estimated that this may result in additional financial assistance costs of up to $250,000 in FY 2012/13 to account for new seniors who may have been ineligible to receive financial assistance this year.
I wish to point out that the Ministry Headquarters’ budget will be reduced from $3.7 million to $2.45 million during the upcoming fiscal year, a reduction of 34%.
Part of the decrease in the Ministry Headquarters budget is due to a reduction in the Mirrors Programme budget from $1.69 million in FY 2011-12 to $1.3 million in FY 2012-13, a decrease of $392,000 or 23%.
This allocation will allow the Mirrors Programme to undertake programming that includes one intensive residential cycle for the 15 to 18 year old participants and 2 middle school level coaching for success programmes.
The Mirrors staff must be commended for continuing to find ways to cut costs while still delivering these much needed programmes in the community. [Note that part of the cost reduction in the Ministry Headquarters ($852,000) is due to the transfer of the responsibility for parish councils out of the Ministry Headquarters to another Ministry.]
The Ministry determined that it is necessary to add approximately $1.0 million to the budget estimate for the Department of Child and Family Services for the Psycho-Educational Programme, bringing the cost of that Programme to $3.12 million for FY 2012-13.
The Ministry had reduced the Psych-Ed budget last year by the same amount, but has found that there is still a continuing need to place children overseas for treatment. The Ministry will continue to search for viable ways to reduce the cost of overseas treatment going forward.
Lime Carifta Games
Bermuda will have the honour to host the 40th Lime Carifta Games at the National Sports Centre from April 6-9, 2012. This will be the fourth time that Bermuda will host these prestigious Games, having hosted them in 1975, 1980 and 2004.
The Games will showcase some of the best youth track and field athletes from the Caribbean region in under-17 and under-20 categories. Many Bermudians who attended the 2004 Carifta Games will remember the superb performance displayed by Usain Bolt of Jamaica when he broke the under-20 record in the 200m sprint in a time of 19.93 sec, a record that still stands today.
The Carifta Games promotes qualities of sportsmanship, fitness and friendship among youth from different Caribbean countries including Bermuda and helps to build strong character through friendly rivalry and competition. The Ministry has been allocated approximately $400,000 in FY 2012/13 to support the Lime Carifta Games.
This has contributed to an increase in the budget estimate for the Department of Youth, Sport and Recreation of around 5%, bringing its total budget to just over $12 million for FY 2012/13.