The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

THE Government's annual healthcare Budget is around $100 million short of the system's needs, despite some controversial contracts being cut by 50 per cent.

Dr Duane Sands, minister of health, told Tribune Business that even allowing for an "aggressive" effort to eliminate waste, inefficiency and under-performance, a combination of staffing needs and essential capital projects are more than the Government's finances can currently sustain.

While the Ministry of Health's spending was down some $32.556 million year-over-year in the 2017-2018 mid-year Budget, the Minister said this had been partially achieved by "interrupting" capital works already in progress because the Government's fiscal constraints mean it simply cannot fund them.

He added that other savings had been obtained from a "contract by contract" review, pointing to the 50 per cent "re-negotiation" of the cleaning deals for the Abaco and Exuma mini-hospitals that he heavily criticised in last year's Budget debate.

Still, Dr Sands said the public healthcare system was "not there yet" when it came to eliminating the $100 million in waste and efficiency previously identified by chief medical officer, Dr Glen Beneby.

He added that he was intent on introducing "a level of honesty and transparency" in terms of healthcare costs, emphasising that there was 'no free lunch' and that Bahamians would have to pay more if they wanted more services.

The Government currently spends around $400 million on healthcare per year, including the Ministry of Health's $307 million Budget allocation; $70 million in health insurance premiums for the teachers and armed services; and accident/sickness benefits from the National Insurance Board (NIB).

With an equivalent sum generated by the private sector, the Bahamas' total annual health spend totals $800 million, but Dr Sands said the country was not receiving "a whole lot of value" for that outlay - which is around $100 million below what is necessary on the public side alone.

"Even if we cut out waste, and we're trying to be aggressive in cutting out waste in terms of contracts and dealing with underperformance, when you look at the requirements to recruit nurses, retain staff, deal with some of the capital projects - relocate the morgue, create a national blood bank, adequate transport for community services - and new projects, emergency rooms and urgent care centres, that's going to cost a pretty penny," he told Tribune Business.

"If we are going to do as we have promised, to improve the NHI benefits, that's at least another $100 million give or take. "The idea we can improve services without a significant or drastic increase in cost is fantasy. What we would like to do is get people to understand: 'If you want to do the following, this is what it's going to cost you'.

"If we're going to add 200 nurses, and bring the shortage down from 600 to 400, this is what it's going to cost you. To re-open the beds in the Intensive Care Unit, add another CAT scanner, staff the mini-hospitals, this is what it's going to cost you."

Dr Sands said "there's not a lot of headroom" to finance all this from the Government's Consolidated Fund, adding: "The Minister of Finance will probably say there's no headroom.

"If we are going to increase or improve services, and we have maximised the elimination of waste, then those identified funding sources have to be specified. The appetite of the public to choose from that menu has to be determined.

"The conversation in the past was: 'Would you like these services because they're free?' The answer is going to be: 'Yes'. But would you like those services even if they're not free?" he continued.

"Bringing a level of honesty and transparency to the discussion is critically important because without that there's no end to the demand. Everyone will want robotic surgeries, minimally invasive surgeries, unlimited general medications, which is all well and good but there's no healthcare system that can provide them."

Dr Sands said "belt tightening for fiscal realities" had seen the Ministry of Health's mid-year Budget spending drop from $150.706 million to $118.151 million year-over-year, a drop of 21.6 per cent.

"Part of that is cash basis accounting," he explained, "but a number of in-train capital works had to be interrupted because we couldn't fund them. The money is not there."

To eliminate waste, Dr Sands said a "complete review" of every Public Hospitals Authority (PHA) contract had been conducted. The monthly cleaning contracts of $424,638 and $500,000 for the Exuma mini-hospital and Abaco clinic, respectively, the latter of which had then yet to open and were heavily criticised by the Minister, have both been "re-negotiated to 50 per cent of the original amount".

"We've sought to ensure fair contractual relationships with vendors who could still make a reasonable profit," he told Tribune Business. "We've eliminated waste for the taxpayer. We're going to continue to do that.

"In addition, we have eliminated some services that we did not deem absolutely necessary; that we couldn't justify. Certain security services have been eliminated, which have been costing many tens of thousands of dollars a month.

"Are we there? Have we reached the $100 million per year that Dr Glen Beneby says is accounted for by waste and inefficiency? No, we're not there yet."