Matters in Healthcare: How health insurance changes to the Standard Hospital Benefit affect you

The Bermuda Health Council and the Bermuda Sun have teamed-up to answer your questions about the island’s health system. Visit www.bhec.bm to submit your queries and look for our response in the Bermuda Sun on the last Friday of every month and on www.bermudasun.bm

Answers supplied by: Jennifer Attride-Stirling, CEO of the Bermuda Health Council

Question: I heard the Minister of Health announcing changes to health insurance, but I have my policy through a private insurer, not Government, so why does it matter to me?

Answer: The changes to the Standard Hospital Benefit (SHB) announced by the Minister are important for everyone because every insurance policy sold in Bermuda (private or public) must include this minimum benefits package — SHB.

Employers are required to provide at least SHB coverage for their employees and their non-employed spouses and pay for half the premium. Government provides this coverage for children, seniors and the indigent by way of subsidies. 

The SHB currently covers the majority of local hospital services and some diagnostic imaging procedures in private facilities as well as some overseas hospitalization. 

Another fund, the Mutual Reinsurance Fund (MRF) covers kidney-related and long-stay costs. The premium for this cover is set by Government annually.

Your private plan, and most health insurance policies on the island, will also include supplemental benefits. These supplemental benefits usually cover private doctors’ hospital care and office visits, overseas care, dental care, and so on. The insurer sets the premium for supplemental benefits. 

These supplemental benefits are in addition to the SHB cover included in your health insurance policy, so any changes to the SHB may affect your policy whether you have a private or a public insurance policy. 

Question: And what are the changes to health insurance and why?

Answer: While your insurance policy includes the SHB, which you and/or your employer pay for, Government subsidizes SHB coverage for specific populations. 

The Government pays 100 per cent of SHB cover for children, the indigent and, at different rates, seniors. In recent years, the total paid by Government on SHB subsidies has been approximately $115 million a year for local and overseas care. 

Due to the economic environment this year, the Ministry of Health and Environment was required to reduce their budget by 7 per cent. By restructuring the SHB, the Ministry will save approximately $17.6 million. The changes and their impact are summarized below.

Changes to SHB

SHB will not cover overseas care.

For insured persons, overseas care will be covered by supplemental benefits, which most insurance policies have, including HIP and Futurecare. Uninsured persons will not have overseas cover.

Government subsidies for seniors reduced by 10 per cent.

Insured seniors will see no difference in their SHB local coverage or SHB premium. They will still be covered for 100 per cent of SHB under all private and Government plans. If aged 65-74, subsidy will pay 70 per cent and insurers 30 per cent. If aged over 75, subsidy will pay 80 per cent and insurers 20 per cent. Previously subsidy paid 80 per cent and 90 per cent respectively.

Uninsured seniors’ SHB out-of-pocket payments will increase by 10 per cent.

MRF benefits shifted to SHB. 

This will have no effect on the public or providers. The benefits in the MRF will now be part of the SHB and will be covered by all private and public payors, as all SHB services are. 

Various MRF transfers.

This has been a historic transfer that allows Government to provide affordable insurance plans to any Bermuda resident without turning anyone away. It will be increased and this will have no effect on SHB coverage. 

In addition, a new transfer of $0.67 to the Bermuda Health Council will reduce the burden of Government grants. Due to the combined changes, the SHB premium won’t see an increase. 

If you have any additional questions or concerns, visit our website www.bhec.bm or contact us on 292-6420.