PHA using all avenues to increase revenue while preserving healthcare access

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MINISTER OF HEALTH, Dr. the Hon. Duane Sands. (BIS Photo/Andrew Miller)

Minister of Health Dr. the Hon. Duane Sands said the Public Hospitals Authority (PHA) Board, appointed in June 2017, has been hard at work improving efficiencies of the PHA, embracing all opportunities to improve revenue collection, while preserving access for those who cannot afford care. “Efficiencies are now being identified to consolidate cost across the public health sector,” Dr. Sands said during his Contribution to the Mid-term Budget Debate in the House of Assembly, Monday, March 12, 2018. “As at this mid-year period, the PHA has incurred expenses amounting to $126,758,522 or 59.3 percent of its total budget allocation for the fiscal year.”   He said these expenses exceeded available funding released from the Ministry of Finance by $19.8 million (a shortfall of 18 percent of the funds required to date). “With respect to Revenue collection for the first six months of the year, the PHA has collected $5.8 M which represents an 11 percent increase over the same period last year but 13 percent below the current year’s projections.”

Dr. Sands said after coming to office in May 2017, this present government administration met an urgent financial situation at the PHA where there was $16 million in unpaid bills for recurrent expenditure items.  These included:

  • $2.96 million for outsourced dialysis services
  • $1.1 million for patient referrals
  • $2.9 million for pharmaceutical drugs and vaccines
  • $2.2 million for medical and surgical supplies

“This Government subsequently provided the funding to settle these bills.”

He said, “Additionally, as it relates to capital expenditure, we discovered a series of unfunded capital contracts, projects, etc. for the Department of Public Health and PHA that amounted to $88.5 million.” Dr. Sands explained that in previous parliamentary proceedings the government would have debated some of the notable construction contracts included in the amount. “To address this significant inherited funding challenge, for fiscal year 2017/2018 these capital projects are being reviewed, reprioritized and re-scoped to ensure the best use of limited financial resources; and $10 million in funding has been allocated to salvage which of these projects may still be viable.” He noted that due to budget shortfalls and increased utilization of public healthcare services, the PHA accumulated $11.7 million in outstanding bills for recurrent expenditure items as of December 2017.

These included:

  • $2.2 million for outsourced dialysis treatment;
  • $0.6 million for the referral of patients for radiation therapy;
  • $3.1 million for procurement of drugs and related supplies; and
  • $1.1 million for medical and surgical supplies

The Health Minister said consequently, to prevent any service disruptions or compromise to patient care, the Government promptly secured funding to settle these bills from a reallocation of the funds in the NHI budget.  The transferred funds were credited to the PHA in installments in January and February 2018. “Each year, the PHA operating expenditure has averaged $27,304,063 over the budget allocation. The Authority continues to strengthen measures to enhance cost efficiencies and where appropriate, reduce wastage and embrace all opportunities to improve revenue collection.  “These efforts will best be achieved by enhancing existing policies and developing new policies as required, to improve good management over the short and medium term.”

He said the recently established Supplies Management Agency (SMA) will expand group purchasing of other items including food services and office supplies. Other cost-saving initiatives include reviewing, streamlining and renegotiating ICT contracts to reduce costs; expanded use of solar energy; outsourcing of appropriate services to streamline costs; and review of Human Resource policies, procedures, staffing and scheduling to reduce costs. The Health Minister said all avenues to increase the revenue generated through the PHA with the preservation of access to those who are unable to afford care must be utilized. “Progress has been made with insurance companies and in the execution of our business practices.  Centralised collection management with emphasis towards collections for insured and international clients; incorporation of Billing Consent within the Patient Registration process; charge memos complemented by bundle billing; and mutually beneficial collaborative partnerships [e.g. Physicians Alliance Management Limited, Doctors Hospital, Turks & Caicos government] are some of the revenue generation initiatives being explored.”

He said, “We are using all avenues to increase the revenue generated through the PHA with the preservation of access to those who are unable to afford. “We have made progress with insurance companies, our business practices and cost savings through bulk-buying and supply by demand arrangements.  The public should be assured that those who are unable to pay for services will be cared for.”

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