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BHB: Doctors were ‘significantly overpaid’

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Some doctors employed at King Edward VII Memorial Hospital were “significantly overpaid” and even given bonuses after negotiating contracts with former hospital Chief of Staff Donald Thomas, according to the new Bermuda Hospitals Board.

And the findings were backed up by independent consultant Howard Associates, which discovered that some doctors were hired “at very high compensation” on contracts that contained “very unusual terms, heavily in favour of certain doctors”.

“There are currently just under 100 doctors, including the medical chiefs and locums.

“It is our assessment that some clinical specialities are overcompensated at BHB relative to industry norms and averages and a few are under-compensated,” the consultants said.

“We also found that a few clinical specialities are being compensated using formulas that we have never seen before anywhere else.

“We believe there is too much variability in medical staff compensation. There is too much inappropriate compensation at the present time at the BHB and not related to market conditions.”

According to BHB Chairman Jonathan Brewin, a second independent review of salaries at the hospital “has confirmed that physician contracts were not equitable”.

“We found that due diligence had been undertaken in setting executive compensation, but physician compensation had been set through individual contracts agreed through the Chief of Staff Office without, in our opinion, appropriate oversight,” Mr Brewin said.

“A review by compensation consultants Towers Watson has confirmed that physician contracts were not equitable.

“The Towers Watson report confirms the findings of the internal review of physician contracts. Other findings included no governance structure, which resulted in irrational compensation levels that do not align with market rates; productivity thresholds and work expectations that were not defined; performance bonus plan incentives that were unclear; physician compensation that was not based on quality, patient satisfaction or other non-productivity based performance metrics; and physician compensation that was not equitable.

“Indeed, physician compensation/performance pay was often paid on utilisation rather than quality.”

According to Health Minister Patricia Gordon-Pamplin, new contracts with staff are set to be drawn up.

“It should be noted that the discontinuance of bonuses for senior executives that were approved by the previous administration and the revisions of physician compensation contracts will assist the financial position [of the BHB],” she said in a written statement tabled in the House of Assembly on Friday.

Former Shadow Health Minister Louise Jackson raised the question of hospital salaries during a debate in the House of Assembly last year.

But then-Health Minister Zane DeSilva dismissed concerns, saying: “Our discussion about our only hospital should be less about salaries and more about quality of care.”

The hospital’s bill for medical salaries has shot up by more than 75 percent in the last seven years, from $33.1 million in 2005/6 to $58.5 million in 2010/11.

A BHB spokesman explained that part of the reason for that increase was a rise in the number of dcotors working at the hospital.

“New specialties were provided by the hospital and anaesthetists were hired, in line with a recommendation from the Ombudsman’s Report ‘A Tale of Two Hospitals’,” the spokeswoman said.

The medical salaries bill at King Edward VII Memorial Hospital rose more than 75 percent in a five-year period.
The medical salaries bill at King Edward VII Memorial Hospital rose more than 75 percent in a five-year period.

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Published June 27, 2013 at 9:00 am (Updated June 26, 2013 at 8:26 pm)

BHB: Doctors were ‘significantly overpaid’

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