The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The model established by the National Prescription Drug Plan (NPDP) provides lessons for structuring the proposed National Health Insurance (NHI) scheme, given that 91 per cent of its purchases are made from private sector pharmacies.

The Government’s own consultants, in their October 2014 report, admit that the overwhelming tendency of drug plan beneficiaries to access their prescriptions via the private sector “needs to be considered” in structuring NHI.

“The NPDP is unique as it is the only public financing system which allows beneficiaries to access care within the public system or the private health system,” the report by Sanigest Internacional says.

“Of the drug claims for NPDP in 2013, the vast majority were to the private sector (91 per cent of all drugs claims went to private pharmacies).”

Out of the $8.429 million spent on prescription drugs under the NPDP for that year, some $7.608 million went to private pharmacies. Just $780,742 was spent with the public health system’s 70 pharmacy outlets, despite the fact they outnumbered the 48 private pharmacies participating in the plan.

“The allocation of NPDP to predominantly the private sector was true of all islands with private pharmacies, other than Andros,” the Sanigest report said. “It ranged from a low of 16 per cent to the private sector in Andros to 93 per cent of the private sector in the Abacos.”

The report also suggested that private sector pharmacies were far more efficient at claims handling than their public sector counterparts, enjoying half the rejection rate (in percentage terms) of the latter.

“The private sector submitted 430,834 drug claims to NPDP, of which 65,890 were rejected (15.3 per cent),” Sanigest disclosed. “However, the public sector pharmacies submitted only 63,562 claims, yet 18,756 (29.5 per cent) were rejected.

“It is unclear why the rejection rate is almost double for the public sector as for the private sector, but should be analysed in further detail, as that is clearly an inefficient use for the patient (who would be disappointed or frustrated at the rejection), the pharmacy and the NPDP office.”

Unwittingly or not, the Sanigest report’s revelations on the NPDP are the strongest possible argument for the Bahamas to retain a public-private partnership model in the provision of this nation’s healthcare.

The document also clearly shows the inefficiencies in the public health sector, with its number of pharmacy rejections double the private sector’s in percentage terms despite having to cope with claims that are one-seventh of the latter’s.

The Sanigest report, in other words, highlights just how much stronger the public health sector’s infrastructure must become before it can cope with NHI. The NPDP section provides the most compelling argument for postponing, or at the least phasing in, an NHI scheme, plus maintaining a strong private sector alongside it.

Sanigest effectively concedes this itself in heavily-coded language, recommending: “The experience of the NPDP with regards to where patients accessed their prescriptions (in the private sector over the public sector) needs to be considered when contracting with providers.

“It has potential positive benefits of allowing Bahamians greater access to underutilised capacity within the private sector, which could alleviate a public system which is often over-utilised.”

Still, Sanigest said warned of “the financial implications in a system where the dollar follows the patient”, while conceding that the 1 per cent increase in National Insurance Board (NIB) contributions that has been proposed to finance the NPDP provided “a potential starting place for NHI revenues”.

The report added: “It is foreseen that the NPDP benefits will be merged into the new NHI plan, so it would follow that the contribution for the NPDP could begin to allow for the expansion of the pharmacy benefit to the wider population.”

The NPDP was established in 2010 by the Ingraham administration to finance free prescriptions to members. By end-2013, it was serving 23,172 beneficiaries, up from 16,417 two years ago.

Yet, in a further indication of the efficiency gains to be had from maintaining a private healthcare sector alongside an NHI model, total NPDP plan costs spent on administration and salaries have decreased - in percentage terms - over time.

“Expenditure per beneficiary on the plan has grown over time from $409 per beneficiary in 2013, compared to $288 in 2011,” the Sanigest report found.

“However, in a positive manner, the proportion of the total costs allocated to the benefit have increased significantly from a low of only 69 per cent in 2011 (31 per cent not spent on drugs) to 89 per cent in 2013, a significant improvement.”