Bermuda shorts 22: light at the end of the tunnel

by Bill Shields

24 March 2021

In April 2017, after 30 years working in NHS finance, former HFMA chairman Bill Shields moved to Bermuda as chief financial officer of the territory’s hospitals board. In this series of blogs, he documents his experiences.

As I write, Bermuda is coming to the end of its winter. Unlike the UK, and although we are in the North Atlantic, we don’t get snow and the temperature typically doesn’t drop below the mid-50s (degrees Fahrenheit). We have, however, had high winds for days at a time and much more rain than usual. Perhaps another sign of climate change?

I am now coming to the end of my fourth year here and it feels like a sensible time to look back and reflect on my experiences.

Unfortunately, my mishaps have continued unabated. Following food poisoning last year, I managed to follow this up with concussion after falling off a ladder while trying to disconnect a faulty fire alarm in the early hours of the morning. I’ve also got a scar on my cornea, which I acquired while removing a contact lens. Both of these events earned me a trip to Bermuda Hospitals Board’s very efficient emergency department.

As I have written many times, Bermuda is unlike most countries in the world, which is hardly surprising given its isolation and geographical location. While a British overseas territory, the US is a major cultural influence due to its proximity. This can sometimes lead to a slight sense of schizophrenia when it comes to sport preferences, use of American English or not, left hand drive cars with speed limits in km/h and so on.

Healthcare is not immune to these influences and has moved from a reimbursement system with a major focus on fee-for-service to a fixed payment mechanism. And there is ongoing discussion about population-based payment systems being introduced in future.

Bermuda has fared relatively well during the pandemic with 12 deaths, 830 cases and 30% of the population already receiving two doses of the Pfizer vaccine. I am very pleased to be one of those individuals who got vaccinated. But with my recent health history, it was no real surprise when I struggled for 36 hours after the first dose with chills, aching joints and flu-like symptoms and for 12 hours with a slightly less severe reaction after the second dose.

Like the rest of the world, however, Bermuda is facing the economic impact of the pandemic in the current year and for at least the next two. Indeed, the minister of finance in his recent budget statement indicated that it will be 2022/23 before the country produces a surplus.

For BHB, this means further tightening of the financial position. Many of you, I know, will be familiar with delivering savings plans in your individual organisations and I have written about, and delivered, my fair share in the NHS.

The last four years have been very different, however. BHB’s funding has either remained static, or reduced in absolute terms since 2017. Over this period, revenue has reduced from $340m to $315m. This is due to pressure on government resources and has been exacerbated by the collapse of the tourism industry in 2021/22, leading to almost no overseas patients being treated here.

When combined with no working capital facility to provide a safety net, we have to consider the prospect of seeing cash reserves being completely eradicated and even bankruptcy. While we have managed to deliver savings in each of those fiscal years, the challenge of making these recurrent and cash-backed has been more difficult to deliver against.

Equally, the somewhat circular nature of funding in Bermuda and the complications of a system funded from insurance dollars, rather than through general taxation, can seriously complicate matters. For example, any reduction in the permanent workforce is likely to have a knock-on impact on the ability of individuals who are no longer working being able to afford insurance cover.

BHB is obliged to provide care for the indigent population as well as those with inadequate, or no insurance cover, meaning the saving can be eradicated. Equally, an increase in health premium to generate more funds for BHB will also lead to an increase in its own health plan premium. This will create an unfunded cost pressure for BHB and additional expense for employees as the premium is shared equally between employer and employee.

Against this backdrop, now would probably not be considered the optimal time to implement a major infrastructure programme like our electronic medical record. However, BHB has no choice: our current clinical systems are either legacy, with support ending later this year, or manual, paper-based and very labour-intensive. Now that the contract with Cerner Millennium has been finalised and signed-off by government, we have started the first stages of a two year implementation programme.

Due to the continued travel restrictions and quarantine requirements caused by Covid-19, this will be done, largely on a remote basis. This is an unexpected benefit of the pandemic as 12 months of remote working has prepared staff for learning in a much more cost-effective manner than could previously have been imagined.

As I get ready for the start of my fifth year as an ex-pat, I have just moved into a new apartment in the capital, Hamilton. Having experienced the East and West of the island, or at least the daily traffic jams from each direction, I’m now looking forward to walking to work in the warmer months ahead. Hopefully the world will start to return to something more like normal over the coming year. Once international travel for pleasure as well as business recommences, I look forward to catching up with many of you and sharing our experiences of dealing with this unprecedented period.

What is undeniably the case is the reliance countries have placed on health services, how their ability to respond was linked to: emergency preparedness; sufficient bed capacity; a coordinated response; swiftness of action; and consistent messaging. Bermuda has benefited from all of these aspects and, while we are not out of the woods yet as a country, have fared much better than many other jurisdictions with none of the co-morbidities in our population.

Until the next time, good day!