WEDNESDAY, AUGUST 1: Health care costs in the public sector have risen three times faster than those in the private sector, shadow Health Minister Michael Dunkley said yesterday.

Senator Dunkley said spending by the Ministry of Health and Bermuda Hospitals Board (BHB) went up by 26 per cent between 2009 and 2011, compared to an eight per cent rise in spending by the private sector over the same period.

But his claims that Government itself is the main driver of soaring healthcare costs have been rebutted by the Health Ministry, which points to an 18 per cent drop in administrative costs. 

Senator Dunkley said: “Bermuda cannot hope to have a constructive discussion about the cost of health care if the Government can’t acknowledge where the problem lies, which, clearly, is in areas of spending under its control.”

The war of words between the OBA and Government flared after Health Minister Zane De Silva unveiled the National Health Accounts for 2011, which showed the hospitals system got $142.5 million — 43 per cent of the total spent on health.

Sen Dunkley said: “The report painted a very disturbing picture of soaring health care costs that are already pushing family and personal budgets to the breaking point.

“The Health Minister is on record as saying health care costs are rising at an unsustainable pace and we agree.”

He added: “The National Health Accounts show without question that the Government itself is the largest driver of our sky-rocketing costs.”

But a statement issued on behalf of the Ministry of Health said: “The health accounts show that Ministry expenditure went down by four per cent in 20011, admininstration costs went down by 18 per cent and prevention and curative care went up by five per cent.

“BUS expenditure went up by eight per cent. This shows clearly that the public sector is not the largest driver of health cost increases.”

A spokeswoman added that hospital fees went up by two per cent this year and one-and-a-half per cent last year.

And she pointed out: “Each year, one per cent of this was reserved to pay for the new hospital.”

She said: “Hospital fees must be approved by the House of Assembly and the Senate each year. This is the responsibility of the entire legislature, not just the Minister of Health.”

The spokeswoman added: “The hospital has accounted for a slightly greater share of expenditure overall, because services, including anaethesia, obstetrics and cardiology, have been transferred from the private sector — these benefit the whole population and ensure that the cost is community-rated.”

She said that average annual growth rate was 14 per cent in the public sector compared to ten per cent in the private sector.

But she added that the public sector increases included the cost of the introduction of the low-cost seniors health plan FutureCare, a new payment and processing system for the health insurance department, as well as the cost of bringing some medical services in-house.

Sen Dunkley said the last financial statements for the Bermuda Hospitals Board (BHB) were issued in the financial year 2009/10 and the accounts for the financial year 2010-11 were overdue.

He added: “my colleagues in the House of Assembly have been asking for the release of this report for months and we’ve received nothing from the Government but stalling.”

Sen Dunkley added that the King Edward VII Memorial Hospital made a profit of $18.3 million in 2010 and around the same in 2011.

He said: “There is nothing wrong with the hospital making a small profit, but the increase has come from increasing fees rather than increasing efficiency.”

Sen Dunkley added that the Chargemaster billing system, introduced in 2009, had helped drive up costs.

He said an appendectomy was $2000 in 2008 – but after Chargemaster was up and running, the cost had gone up to $6000.

Sen Dunkley added: “Another reason is the potential for over-utilisation and abuse within the system since insurers must pay whatever fees the hospital charges.”

He added: “It’s clear that Government’s overall healthcare costs are rising much faster than private sector costs and they’re much less efficient at administering them.”

OBA Pembroke Central candidate and party health board member Andrew Simons added that higher hospital fees meant increased premiums for patients.

He added that the spiralling cost of health also hit Government’s ability to pay for subsidized care for the young, elderly and indigents.