Minister: Single FutureCare Rate Of $440 P/M

April 3, 2013

[Updated with video + PLP response] The Government will combine the FutureCare Phase 1 premium of $385 per month, with the Phase 2 and 3 premium of $635 per month to create a single blended FutureCare premium rate of $440, Health Minister Patricia Gordon-Pamplin said today [Apr 3]

“We recognise this premium will be an increase for some; however it will be a decrease for those on Phase 2 and Phase 3 of Futurecare,” the Minister said.

Minister Gordon Pamplin continued, “It should be noted that a means testing system will remain in place so that any senior who finds they can’t afford the premium for FutureCare can apply to Financial Assistance. If that senior qualifies, they will receive FutureCare as part of their Financial Assistance benefit.”

There are over 3,500 people who are on HIP – mostly self employed people and small business operators – and Minister Gordon Pamplin said that as many are struggling to make ends meet, the HIP premium will remain at the current rate of $390 per month.

Premier Craig Cannonier was in attendance at the press conference to express his support for the rate change which has eliminated the previous two-tiered system for FutureCare. The changes in FutureCare premiums will take effect from May 1st, 2013.

Minister Gordon Pamplin’s full statement follows below:

Good Afternoon Everyone,

…And thank you for coming today.

One of this Government’s election platform promises and 2013 Throne Speech initiatives was to eliminate what we believed was an unfair two-tiered system for FutureCare…whereby policy holders were paying different prices for the same benefits depending solely on when they joined the programme.

Today, I am delighted to say that we are keeping that promise by announcing that we will combine the FutureCare Phase 1 premium of $385 per month, with the Phase 2 and 3 premium of $635 per month to create a single blended FutureCare premium rate of $440 per month.

We recognise this premium will be an increase for some; however it will be a decrease for those on Phase 2 and Phase 3 of Futurecare.

It should be noted that a means testing system will remain in place so that any senior who finds they can’t afford the premium for FutureCare can apply to Financial Assistance. If that senior qualifies, they will receive FutureCare as part of their Financial Assistance benefit.

The changes in FutureCare premiums will take effect from May 1st, 2013 which will provide the Health Insurance Department with time to notify their policy holders. It will also allow the appropriate premium to be deducted from pension cheques where that is the method of premium payment.

You will know that premium revisions are calculated annually, based on information provided to us by The Health Insurance Committee (HIC) who commissions an annual actuarial review of the premiums, claims and expenses of the funds to determine an appropriate premium.

The Committee and the actuaries provided me with a number of different options for setting the FutureCare premium, and as promised, we have chosen to converge the premiums.

The indications for the 2014 year provided for a Phase 1 premium that was in fact higher than the blended premium amount that has been selected. Your Government has been able to set this lower fee based on an injection of funds into the programme in order for it to be solvent, sustainable and affordable, thereby showing our commitment to our Seniors’ population.

We will continuously be examining the costs of health care in order that we can indeed continue to provide affordable Government insurance coverage.

The benefits of the programmes will not change for the ensuing year, thus everyone covered by FutureCare will now pay the same premium and receive the same benefits.

The actuarial study also provided us with a range of options for setting the premium for HIP.

We have over 3,500 people who are on HIP – mostly self employed people and small business operators.

Knowing that many in these groups are struggling to make ends meet, we made the decision to leave the HIP premium at the current rate of $390 per month.

Despite the more than $54 increase in the Standard Premium Rate, we have left the HIP premium unchanged.

I would like to conclude by thanking the Health Insurance Committee and the actuaries for their hard work. We had difficult decisions to make, but I believe we have found the right balance.

Thank You.


Update 7.10pm: Shadow Health Minister Zane Desilva said, “”The changes increase the burden on the people who can least afford it, lower the burden for those who can most afford it and drives up government spending on Financial Assistance. Simply put, under the OBA, wealthy Mrs.Jones in Tuckers Town now pays the same as Mrs. Smith in Back of Town.

“Last year there were 2616 seniors on Future Care of which 563 were also on Financial Assistance – with this increase Financial assistance will be expected to fork out an approximate $37,000 extra per month! That’s IF the number of seniors on Financial Assistance hasn’t increased.

Additionally , there were 312 seniors paying the higher rate. This price cut, for the people who need it least, means a reduction of $60,880.00 per month. These two changes in premium add almost $1.2 million that will now have to be found by the OBA from taxpayers each year.

“The OBA’s early record on seniors is depressing. First the OBA punished seniors by raising their license fees. Then they abandoned their commitment to Lefroy House, now they are increasing the FutureCare for the people who can least afford it, while giving their wealthy friends a price cut.

“The OBA could have taken this opportunity to increase the prescription benefit from $2000.00 to $4000.00 per year but didn’t. This despite the fact that too many of our seniors are having to pay for their prescriptions long before the end of the fiscal year and end up paying out of their already stretched pockets.

“The OBA could have taken this opportunity to pursue a more balanced approach but didn’t. Instead the taxpayer and needy seniors are expected to bear the brunt of this OBA decision.

“The OBA has a part time Minister charged with looking after the country’s largest budget and as a result hasn’t dedicated the time needed to look at things from the correct perspective. Unfortunately our seniors and indeed our entire population will suffer in the future.

“It is our hope that the OBA will pursue a more balanced approach going forward and avoid asking our Bermuda’s most vulnerable citizens to sacrifice for their wealthier countrymen,” Mr DeSilva concluded.

- PLP statement amended

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  1. FutureCare: PLP Suggests ‘Balanced Approach’ | | April 11, 2013
  1. Seriously.... says:

    “The indications for the 2014 year provided for a Phase 1 premium that was in fact higher than the blended premium amount that has been selected. Your Government has been able to set this lower fee based on an injection of funds into the programme in order for it to be solvent, sustainable and affordable, thereby showing our commitment to our Seniors’ population.”

    No wonder Moody’s put us on credit watch, these folks are robbing peter to pay Paul. At least the PLP raised the premiums when the actuaries said so.

    Nicely worded political statement, but makes the programme even less sustainable!

    • Truth (Original) says:

      So you think Moody’s put us on credit watch because of this move by the OBA and not all of the nonsense and mismanagement of finances that got us to this point?

      You seriously believe that?

      • Seriously.... says:

        Nope, I don’t think this is a reason for Moodys and credit watch, but it is a symptom of the problem.

        OBA was elected on “change”. They said they would fix the fiscal house.

        Now they go ahead, remove revenue from a programme, and provide it with a cash injection to cover the shortfall. That is a recipe for disaster.

        PLP, UBP, OBA – Doesn’t matter who did it, it won’t work! If you don’t fix it you’ll end up in a bigger hole.

        What Moody’s said was deficits are no longer getting smaller they are now getting bigger, that is the problem! PLP took it on the chin for cutting spending, why won’t the OBA do the same?

        • Mad Dawg says:

          The economy is on the trend put in place by he PLP, that’s for sure.

          When the government nonrenewed 15 short term contracts, Roban went public with hysterical rumours about ‘firing 150 people’. So the PLP would rather we continue the irresponsible sh1t.

          They wasted hundreds and hundreds of millions of dollars on stupid stuff.

          • Seriously.... says:

            I don’t defend idiotic behavior from either side.

            Cuts have to be made.

    • Jason Smith says:

      At least you admit that this PLP plan was unsustainable and poorly though through. First admission (even though it was indirect) from you about the PLP’s mismanagement.

      At least this Government has made it fair for all particpants in the programme. Or do you agree with one set paying almost 100% less than others, but recieve the same benefits.

      • Seriously.... says:

        Here is where we can agree. If you have to have an “injection of funds into the programme in order for it to be solvent”

        that the progamme is not SOLVENT!

    • Building a better Bermuda says:

      The PLP never raised the premiums to what the actuaries said they needed to be, they used taxed dollars to keep it afloat, that is why it is unsustainable on its own, they built it off a flawed model and tried to hide that.

      • Seriously.... says:

        I can’t speak for that, but we can see here that the OBA is doing the same thing, if not making it worse! So answer me this, how does THIS move benefit Bermuda. How does it solve our spending problem? How does this help our budget problem? It doesn’t!

        • Mad Dawg says:

          So the PLP set up an unsustainable plan. Now the adults have to deal with the mess.

          • Seriously.... says:

            If Dealing with it you mean making the problem worse…….. Then may aswell let kids do it.

        • Building a better Bermuda says:

          So your solution would be to kill the program and kick seniors out on their butts without affordable coverage.

          The biggest issue with life as we know it is that we will spend 2/3rds of the money spent on our health cost in the last 1/3rd of our life. This makes insuring seniors difficult, unless you have a retirement health benefit from a company, where your costs can be can be absorbed by the profits from a younger healthier contributing pool then you have to get an individual plan. Any insurance company, including the actuaries for the governement, are going to look at you and know that they are going to be spending a lot of money every month on you, and your premiums are going to reflect that. Which brings us back to the problem for seniors who can’t afford those sorts of premiums.

          The PLP lied outright to us when they kept saying that FutureCare was sustainable, and they hide it by infusing tax dollars into it and shifting costs and making payment from other health funds like the Mutual Reinsurance Fund. If you have read any of the paperwork on Bermuda’s healthcare infrastructure you will know that the MRF is funded by a tax on insurance premiums, so in effect, if you pay health insurance to anybody, whether private or government, you are paying into the MRF. And without going into blah details the MRF is there to cover certain health cost, which is how they aren’t able to shift claims payment from it.

          I agree, this is not a fix, but a short term patch as is causing the rise in rates in order to keep the MRF afloat. One possible long term fix would be just to outright tax a fee that would go into it own fund, and it would need to be pretty much constitutionally protected to keep governement from dipping into for other things, that could then be used help subsidize seniors insurance premiums. This would be a long term view, in that the tax fees on myself, I might not fully reap back in be elder years, but my children might, if the fund is allowed to mature and grow to a sustainable volume.

          Face it, it’s going to be tough as we extend well past our bodies intended life span

      • blankman says:

        Do you actually believe that the PLP ever had “the actuaries” look at this and determine what the correct premium should be?

        And even if they did, you have to look to the US to see just how accurate predictions of that sort are. When Medicare was introduced in 1966 Medicare cost $3 billion. At the time the Ways and Means Committee estimated that in 1990 it would cost $12 billion. Instead it cost $107 billion (the difference is a factor of 9).

        Turning north to Canada, then Finance Minister Paul Martin fired his chief actuary because that individual refused to change his answers to agree with Martin’s public claims regarding contribution rates.

        • Seriously.... says:

          You can’t be serious. Do you have any idea how GOVERNMENT works. Actuarial evaluations are mandatory. UBP, PLP, OBA everyone gets them!

          “Do you actually believe that the PLP ever had “the actuaries” look at this and determine what the correct premium should be?”

          You really can’t be this daft to make a statement like that can you?

  2. navin johnson says:

    Dear Seriously….you need to check with HIP and Future Care to see if they provide coverage for head examinations and if they do you should take advantage of it….

    • Seriously.... says:

      Nice one,

      So what do you think about the 3 million dollars the government “found” to put into the fund. I thought the government was broke.

  3. Bobmarlin says:

    Finally,a govt that cares!

  4. Argosy says:

    I don’t understand….Zane told us repeatedly that the programme WAS sustainable…??

    He didn’t fib, surely!

    • Building a better Bermuda says:

      It was only sustainable cause they kept subsidizing by sending certain payments to the mutual reinsurance fund that is paid for by everybody else as part of the price of our premiums.

  5. Bermuda Boy says:

    Thanks OBA, finally a govt that cares.

    • Seriously.... says:

      Cares to get Bermuda downgraded some more.

      • sonoso says:

        this downgrade was happening regardless of who won the election.. seriously!

      • Mad Dawg says:

        The Cog told us downgrades don’t make any difference. Was she dissembling as usual?

        • Webster says:

          I would love to see Paula Cox on the “lets talk show” with Gary Moreno !!!!

        • Seriously.... says:

          Chamber of Commerce is saying the same thing. So both are lying?

  6. Just thinking says:

    Apparently this wasn’t sustainable >> old rate 385 + 635 = 1020 / 2 = 510 average

    New rate for all is 440. That is 70 dollars less overall to government << so this is now sustainable. Can someone help me with the logic?

    • Mad Dawg says:

      Your math assumes an exactly equal number of members at each rate. To get the proper average rate, you need to know the number of members at each rate. For example:
      385 x 10 members = 3,850
      635 x 3 members = 1,905
      Therefore 13 members = 5,755, which is an average of 442.

      There are also assumptions that can be built-in about the relative longevity of each group during the coming 12 months.

  7. Bermuda Boy says:

    Next thing to do…Give us back our private pension money, this was a stupid PLP arrangement anyway. We need that money now to survive. It probably won’t happen because the investment companies are too strong.

  8. ABC says:

    bermuda next 3rd world sad but tru

    all politics r de same talk no actions

    wen de good lord shine his light hope all u r ready

    2 much corruptions

    D:< D: D8 D; D= DX v.v D-':

  9. Colin says:

    For all those who expected the OBA to fix the big mess that the PLP left this country in a matter of months then they surely have their heads in the sand or are being critical for the sake of just making noise. The PLP deceived us with fairy tale economics with handouts to so many people regardless of their means to pay. It’s disingenuous for Zane DeSilva to complain of the single FutureCare rate when it was his team that gave land tax breaks and licence fee breaks to all seniors for their primary home and their car regardless whether they came from Middletown or Tuckers Town. I’m so glad now they are in Opposition and we have a competent government who is our best hope to return this country to prosperity but we must be patient because it will take years not months to climb out of the PLP created hole.

    • Seriously.... says:

      Competent Government who just found 3 million dollars a week after claiming they were broke.

      who is “deceived us with fairy tale economics with handouts” may apply in this case aswell.

      This IS a handout to those paying the higher rate. You no longer have to pay it, the Government will!

      • Jason Smith says:

        That is what has been going on with this damn program since its inception. The former Government had to use taxpyaer dollars to ensure it remained relatively solvent. There were many saying that such a program was unsustainable at the time only to be met with cries of racism and accusations that they didn’t care about the average person yada yada yada.

        Now all of a sudden you are soooo worried and distraught about $3mn being injected to keep the program going. Funny, ironic and hypocritical all in the same post. Keep it coming…seriously…

        Exactly what do you propose instead?

        • Seriously.... says:

          I’m not familiar with the intracies for Future Care, nor am I familiar with its history. However I’m pretty sure the PLP raised future care rates!

          What I do know it that if you have to make a cash injection and your reason for doing it is so you don’t raise the rates your are increasing the subsidy those that would be paying a higher rate and thus spending money you don’t have.

          What do I propose? I propose that the Government not prop up a broken system. Especially if you are doing it with money that you are borrowing from foreign creditors!

          WTF is the point if the OBA are doing the same as the PLP?

  10. Triangle Drifter says:

    More damage control for hairbrained PLP action. There will be no easy fix. There will be no fast fix.

    If you voted PLP in any of the elections after 1998, hold yourself to blame. You made it happen. The OBA will need at least 3 terms to begin to get Bermuda back to its former respectable self.

    • Seriously.... says:

      They will be lucky to get a whole 1.

      • Jason Smith says:

        Why? Are you zombie zealots planning a coup?

        • Seriously.... says:

          Is that what you call elections now? Coups?? Interesting.

          Still with the “Zombie Zealots”

          I guess you are unable to come up with an argument of why it is a good thing that the government is injecting another 3 Million into future care to keep the rates down.

          But, when all fails, just point refuse to answer the question and call the poster a “Zombie Zealot” That’ll work.

          • Jason Smith says:

            What would you have this Government do?

            Scrap the program all together?

            How do you think that they are supposed to fix a deeply flawed program, since its inception, within 3 months of being in power? The PLP couldn’t do it in 5 years.

            You are so worried about $3mn, but stayed ominously quiet (i.e. zombie like) about the $60 million Bereley overrun, the $30 million Dockyard Pier overrun, the $10 million TCD overruns etc that piled on the debt.

            PS: Why would an election be called before their 1st term was over? The only way they would be kicked out is throug ha coup orchestrated by zombies like you.

            • Seriously.... says:

              Instead or your stupid insults, speaking about behaviors in the past that you cannot possibly know about or speak accurately to my thoughts on those matters, i will stick to the issue at hand.

              The government should not reduce rates for some, increase them for others, set it less that what actuaries say, and then subsidize.

              It may be rhetorical as we don’t know the answer, but don’t you think it could have made sense to keep the current structure, increase the rates to eliminate the need for an injection; and spend 12 months coming up with a “sustainable” plan.

              You keep on with the “Zombie Like” Accusations, but it is remarkable how you are defending the OBA for doing exactly what you criticise the PLP for doing.

              At least keep it consistent.

              • Jason Smith says:

                “Instead or your stupid insults, speaking about behaviors in the past that you cannot possibly know about or speak accurately to my thoughts on those matters”

                Your silence was deafening on those matters. Must’ve been scared to be labeled by the former regime if you speak out. Fair enough.

                Can I ask why you didn’t make your obviously strong feelings on the sustainability of Futurecare before thsi week or December 17 2012? Please ask yourself why before providing a response to myself.

                Any response to the election remark that you made?

                How will they not complete their full first term?

                • Seriously.... says:

                  And how exactly do you know what I said before Dec 17, 2012.

                  Interesting that you’ve tried to move back to politics and completely ignored your intellectual dishonesty by defending the OBA for doing the exact same thing that you criticised the PLP for.

                  You asked a question about FutureCare, got an answer from me, disregarded it and went back to some straw man rhetoric on matters that you know nothing about.

                  That is the problem with Bermuda’s political system, to borrow a word from you “Zombies” on both sides!

                  • Jason Smith says:

                    So why won’t the OBA finish their first term? Please answer…pretty please

                    • Seriously.... says:

                      I have no Idea if they will or if they won’t but In my opinion they’ll be lucky to get through one. 19-17 is a narrow margin. No matter what has happened afterwards, they only have 19 of the 36 seats!

                      Now – I’ll assume by you not talking about future care you’ve admitted your intellectual dishonesty. If not, why are you not critisicing the OBA for doing the exact same thing that you criticised the PLP for.

                    • Jason Smith says:

                      No I haven’t admitted to anything.

                      Can’t really debate with an irrational zombie zealot.

                      Especiallyone that yearns so dearly for the immediate reinstatement of a Party back intio power that brought us to this point of financial ruin. And that doesn’t even address the outright racist nature of the Party itself.

                    • Seriously.... says:

                      OK.. then stop trying to debate me… and in that case, yourself.

                      Your contradictions must have you upset!

                    • Jason Smith says:

                      Dude, get over yourself. You are nothing but sycophant for Party that destoroyed Bermuda with their mismanagement of their finances. All of a sudden you found this desire to be worried about BDA’s finances while you sat around with your thumb up your backside and allowed for the destruction of our economic standing because it was your Party doing the damage.

                      Now the new Government has to try and fix the major damage done by your beloved team and as recent Euro experiences have shown is that massive austerity just increases the economic strain on the country as a whole. Prior to the election you and the PLP kept on babbling on about how the OBA will cut, cut and cut some more.

                      Now that they are in you and your fellow PLPians now demand massive cuts and austere measures. You’re just too hypocritical to have any rational debate with.

                      So keep on blaming the OBA for the mess they inherited. You sound just like the Tea Parties advocating for massive cuts and blaming Pres. Obama for the mess in which Bush had left him in 2008.

                      Good day and keep on defending wrong.

  11. Ryan says:

    Would the OBA’s “wealthy friends” even be using FutureCare at all? Not an impressive response from the Shadow Minister—more “us vs. them” rhetoric. Sad.

  12. Concerned says:

    Mr DeSilva, who do you know in Tuckers Town that would be on HIP? My mother who has been a maid all her life had to pay $635, with a pension of only $890 per month. She still works as a maid and doesn’t clain financial assistance, on the other hand a co worker says her mom only pays $385 because she was one of the first to get on the future care list of people. Your system was unfair. Everyone now pays the same, which is fair to all. And please Mr DeSilva stop the nonsense of rich and poor, because many of us know you and your dealings very well.

    • Seriously.... says:

      COngrats to your granny in getting the first OBA handout. Courtesy of the Taxpayer. That 3 Million that just got added to the debt, don’t blame anyone but who made it possible, the OBA.

  13. Bermudian Mother says:

    @ Concerned
    My 80 yr old mother-in-law receives a non-contributory pension of less than $465, with this increase she now will have less than $25 per month. She is house rich and money poor so she would not qualify for financial assistance. If the goal was to make this fair than the premium should be based on the amount of pension received. Her two sons have to pay for everything else. To be clear, I am not saying the two-tiered rate was fair, it did need to be addressed but the question is – is this the best solution?

    @ Bermuda Boy
    The idea of having a private pension plan was not stupid. It is because the majority of people did not plan for the future (retirement) that they are heavily dependent on the Government pension today. It is the reason why most seniors can not afford to retire and are working well past the age of 65. Let’s say that a person makes $500 per week can you honestly say that $25.00 per week will make a major difference to the current financial position?

    • Seriously.... says:

      Finally, someone with sense.

      Thank you for providing some balance to the sillyness people must read on here.

      One thing I do think that you may want to check into, I think the PLP allowed seniors who were house rich and cash poor to get Financial Assistance. You should check it out.

  14. Prayerful says:

    I do not understand what Zane DeSilva is saying about Lowering the burden on those most likely to afford it. Those most likely to afford it are paying $1,300 to BF&M & Argus so as to have semi-private and private rooms at KEMEH.

    Further Mr. DeSilva say that the OBA should have increased the prescription allowance from $2,000 to $4,000 per annum. I alked to Mr. DeSilva personally about this very issue when he was the head huncho and he told me that things would get better when we had the National Insurance Plan. well……

  15. Legal Eagle says:

    Let’s start with acknowledging that the PLP’s two tiered system which had diffent premiums for the same coverage NEVER made sense-+ the OBA has properly fixed that!! Secondly,it was only because of age differences at the time of F/C’s creation that put subsequent enrolees on tiers 2+3–and NOT any wealth differential–as the PLP/Zane D.are now falsly claiming!!! Finally, why doesn’t the new OBA plan waive the 20pct co-pay (as other Insurers do) on prescription drugs for those that elect to receive the generic versions??? As the generics are approximately 35pct cheaper, that would be a win/win for BOTH F/C + seniors!! A serious oversight OBA!!

  16. Legal Eagle says:

    And further to my previous post, another serios oversight OBA, is not changing the current F/C rule that F/C will NOT pay for prescription drugs obtained overseas–even when they cost F/C less!! Just more pandering to Wendal Brown, at the Senior’s AND F/C’s expense??? Yep, that IS pandering to the wealthy!!

  17. Building a better Bermuda says:

    Mr DeSilva’s statements that the OBA’s change is unfair to the poor and is to benefit their wealthy friends not only make zero sense, but is a blatant misrepresentation of the facts into another self server PLP lie. The original $400+ premiums were never given to only those of less means and the $600+ premiums for those of greater means, they were based entirely on time of enrollment. The increase from those that were paying the 1st phase preemiums will be hard to some or many, the decrease for those who found it hard to make it with the phase 2 & 3 will have some relief.

    To say that this choice was done to benefit the countries wealthy, most of whom probably have a privat plan with major medical benefits, that wouldn’t be on FutureCare, is a flat out lie and he know it. As the former health minister, he knows entirely that without subsidizing and injections FutureCare would be unsustainable. To say that the OBA should have increased the prescription benefits would have added to the need to further subsidize it, and it certainly something he wouldn’t have followed through with had he still been in charge.

    The PLP introduced the highly flawed plan to us and now there are many who have become dependent on it. The PBA cannnot simply drop it and so they are left with task of either raising the premiums to the levels that they need to be to make the program sustainable (this of course would defeat the purpose of FutureCare as the premiums would then become unaffordable) or they do what the PLP did and subsidize it (hopefully this is simply a short term plan while they try and find a better way to keep it afloat)

    The OBA have inherited a budget and a huge mess to sort out and have only had a few month to see what the true mess is, so the PLP’s critising them for not having been able to put together immediate fixes is hypocritical and aimed entirely to try and put down the OBA rather than try and help the country. Everything the PLP has said the OBA should be doing, in the health arena and beyond, smack as hypocritical as there is no indication that the PLP would have followed with any of them had they still been in power. Its serves to try and distract us from the emerging view of the mess the PLP tried to keep hidden. Hopefully we will start to see less of these short terms thee and some more long terms fixes when we come out of the summer.