By NEIL HARTNELL
Tribune Business Editor
National Health Insurance (NHI) is “working backwards” by setting a $1,000 annual price for its basic care package without determining critical costs, a leading doctor has warned.
Dr Marcus Cooper, the Medical Association of the Bahamas (MAB) president, told Tribune Business that the government and NHI Authority should have approached their task “the other way around” by first settling the fees paid to doctors and healthcare facilities providing care under the scheme.
They were now hoping that such fees/costs “fit into” the Standard Health Benefit (SHB) package’s $1,000 premium, but Dr Cooper said all private healthcare providers will be seeking “appropriate compensation” to enable them to both earn a profit and deliver the quality of care patients deserve.
While the MAB backed NHI as “a concept” for securing sustainable healthcare funding, Dr Cooper said he expected “intense discussions” between doctors, healthcare facilities and the NHI Authority during the 2019 first half to “determine if the numbers make sense”.
He revealed that the MAB had only held “superficial discussions” on the scheme to-date because it was still awaiting critical information from the NHI Authority to kick-start fee negotiations, and added: “The devil is in the detail.”
Conceding that “healthcare is a huge problem in The Bahamas”, Dr Cooper warned that Bahamians would have to undergo a major “change in culture” and realise that medical treatments are not free.
Acknowledging that “Rome is not built in a day”, the MAB president suggested that Bahamians would be more comfortable if they saw they were getting value for their money in terms of improved services, care quality and public health sector infrastructure.
And he warned the Government against “starting off big” only to find out the NHI scheme’s benefits were financially unsustainable and had to be “cut back”, as this would instantly undermine credibility and cause many Bahamians to become disillusioned.
Dr Cooper, though, said NHI’s private-public partnership (PPP) model of using private physicians and healthcare facilities to provide care should improve service quality and patient outcomes provided everything is structured correctly.
“Physicians want to make sure they’re being reimbursed fairly, compensated fairly, and facilities want to make sure their compensated adequately to cover the cost of care,” he explained. “If you have a PPP, providers and facilities want to ensure they make a profit. Fees have to be adequate to cover the cost of services and provide quality care.
“The compensation model for providers and facilities is very important. That determines what the total cost will be. The NHI Authority is working backwards. They’ve set the cost [of the Standard Health Benefit] at $1,000 per year, and are hoping physician and facility fees fit into that.
“That should have been the other way around,” Dr Cooper continued. “Negotiate with physicians and facilities to determine the fee, and find out the cost from that. It’s going to take some research and collaboration with the insurance companies to determine. It’s a little backwards.”
The MAB chief’s comments echo concerns previously expressed by both the Bahamas Chamber of Commerce and Employers Confederation (BCCEC) and Bahamas Insurance Association (BIA), which also questioned how the NHI Authority could determine the $1,000 premium pricing for the Standard Health Benefit (SHB) - the minimum care package - without knowing all the costs.
Doctors’ fees and those charged by facilities are critical in determining the SHB’s pricing, but these have yet to be set via negotiation between the NHI Authority and private sector. As a result. there are real concerns that the SHB’s $1,000 premium could under-estimate the true costs of providing all its benefits, requiring the package to either be scaled back or more money from the private sector and their employees.
The NHI Authority’s consultation paper calls for all working Bahamians to contribute two percent of their salary or 50 percent of the premium - whichever is lower - to purchase the scheme’s Standard Health Benefit (SHB) or minimum level of coverage.
Unveiling a similar payroll tax-type funding mechanism to NIB contributions, the paper says the balance of SHB costs will be met by the employer, meaning the latter “will be responsible for at least 50 percent of the premium cost”.
The SHB package’s initial “regulated premium cost” is expected to be $1,000 per year, or $83 per month, meaning that employee contributions will be effectively “capped” at $500 per year ($42 per month).
The tax structure is progressive in the sense that workers with lower incomes contribute less to their premium than those with higher salaries, but this results in their employer having to pay more. For example, Bahamians earning $25,000 per annum or more will split contributions 50/50 with their employer, each paying $42 per month.
However, while workers earning $10,000 and $15,000 will have to pay $17 and $25 per month, respectively, their employers must pay the $67 and $58 balances, respectively.
Dr Cooper, meanwhile, said it appeared as if the NHI Authority had used data from Medicare in the US, the National Health Service in the UK, Canada and other Caribbean countries, then applied it to The Bahamas to come up with the its figures even though these other nations may not be the best fit.
“Compensation is a discussion that has to be had,” he told Tribune Business. “People have to cover their expenses and feel they are being compensated adequately. The devil is in the details.
“I expect this year, in the first half, there will be intense discussions with providers and facilities to see if the numbers make sense. It has to be sustainable. Once negotiations take place we will have the insurers involved, and they will want to make a profit margin. Everyone wants to cover their expenses and see a benefit as well.”
Dr Cooper said the NHI compensation structure would also set the reimbursement rate for care provided outside NHI, involving treatments and services not covered by the scheme, which only increased the importance associated with getting the fee structure right.
Still, the MAB chief said the NHI concept was “good”, with many Association members “interested in being involved” once the terms were “fleshed out” and correct. He added that the primary care phase launched in April 2017 appeared to be working based on patient feedback, and backed the benefits package’s expansion to include secondary services such as cancer and cardiovascular treatments.
“Expanding NHI’s services to include some of those conditions that cause significant out-of-pocket expenses to the patient is worth it,” he told Tribune Business. “If they have breast cancer or dialysis that’s a huge expense.
“Expanding the scope of services is a good thing. We think we can do it sustainably and keep the patient and quality care at the centre. But it would not be sensible to start off with something unsustainable, where you’re proposing to cover a lot of services, and then scale back.
“It’s important to expand services in a way to ensure they’re not a burden on the population and the Government,” Dr Cooper continued. “As you find ways to improve participation, you can expand services. I think we should go about it that way.
“You’ve got to have the money, and people will want to see logistical improvements in services, especially in the public system. If you’re seeing a deduction from your salary, you’re going to want those services to be better.
“It might be wise to improve the services first so that people will see what they’re getting for their money. Show better infrastructure, more physicians, more efficiency, waiting times are less and improved outcomes, and people will be more receptive to contributions as they can see where that money is going.”
Dr Cooper said Bahamians also needed to “get used to the concept of contributing to the cost of healthcare”, with too many having got accustomed to enjoying services at Princess Margaret Hospital (PMH) and the public health clinics for free.
“Healthcare is a huge problem in The Bahamas,” he said. “It’s not just about financing. It’s improving efficiency, changing the culture; we need to make an investment in that. People have to get used to making a contribution. Healthcare is not free.
“There are a lot of complications. Some of it is critical funding, but there’s inefficiency and wastage. People need to get accountable and people need to get used to contributing to their healthcare. It’s going to take some time. Rome wasn’t built in a day.
“Any country with Universal Health Coverage (UHC) pays for it. You see it in your taxes. If you value your health you won’t mind paying for it. But it can’t be that we start off big and find out we can’t afford this, and have to cut back services. We have to make sure it’s sustainable, a quality product and the patient benefits. That’s the most important thing; keeping the patient at the centre of the discussion.”