Burt instructed civil servant to ensure former Premier compensated for MRI losses
David Burt instructed a senior civil servant to ensure Ewart Brown was compensated for financial losses at his two clinics after the One Bermuda Alliance government slashed fees for medical scans.
The Premier sent the letter to the permanent secretary at the Ministry of Health on November 22, 2017 – four months after the Progressive Labour Party won the General Election – in his additional capacity at the time as Minister of Finance.
He described the payments as a “grant” and instructed Jennifer Attride-Stirling to ensure Bermuda Hospitals Board was compensated too.
“I trust that this directive will be implemented accordingly,” he told her.
The Royal Gazette, which obtained the letter under public access to information legislation, understands it was an unusual step for a finance minister to take.
A source said instructions to permanent secretaries were usually issued by the Cabinet Secretary following Cabinet decisions. Derrick Binns was Cabinet Secretary at the time.
But Mr Burt insisted yesterday that he “did not intervene” in the matter and that his written directive, following a Cabinet conclusion, was “consistent with his authority and responsibility” as finance minister.
Mr Burt told Parliament the slashing of fees for medical scans was an “economic vendetta” by the OBA against Dr Brown.
The PLP Government gave Dr Brown’s private clinics compensation of $1.2 million after he threatened legal action, while BHB received $2.4 million.
Bermuda Health Council sets the fee schedule for MRI and CT scans for community healthcare providers.
In 2017, under the OBA, there was a change in the way the fees were calculated and a relative value unit methodology was adopted.
The change meant far lower fees came into effect on June 1, 2017, affecting the King Edward VII Memorial Hospital, as well as Dr Brown’s two clinics.
The health council’s former chief executive, Tawanna Wedderburn, alleged in a 2019 lawsuit that Mr Burt had interfered in the running of the BHeC to push taxpayer-funded payments to Dr Brown, who was Progressive Labour Party premier between 2006 and 2010.
Mr Burt “strongly denied” the allegations.
The judicial review application by Ms Wedderburn, who was fired from BHeC in December 2018, was thrown out by a judge who found there was no public law element to the termination of her employment.
The Gazette has previously reported, based on earlier Pati disclosures from the Ministry of Health, that Dr Attride-Stirling told Ms Wedderburn in a June 2017 e-mail that she wanted to record how there was lengthy consultation on the reduction in fees and that Dr Brown was not politically targeted.
We also revealed how Dr Brown e-mailed health minister Kim Wilson in August 2017 to ask her to “politically interfere” because it was the "only way to right the wrongs heaped upon me, and others, by the OBA“.
Mr Burt, in his November 2017 letter, cited the section of the Public Treasury Act which enables the finance minister to direct public officers on the spending of public funds.
He told the permanent secretary: “You as the accounting officer of the Ministry of Health are directed to provide a grant to Bermuda Healthcare Services, the Brown-Darrell Clinic and the Bermuda Hospitals Board for an amount equal to the difference between what is paid for MRI and CT claims by the Health Insurance Department, between June 1, 2017 and March 31, 2018, and what would have been paid during that period if the fees for MRI and CT had been set using a relative value method, revenue-neutral for BHB.
“This ensures that the total grant amount will be based on actual claims adjudicated by the Health Insurance Department during this period.”
Despite the government grant, Dr Brown closed the Brown-Darrell clinic.
The latest Pati disclosure includes an e-mail he sent on January 12, 2018 to Mr Burt – and copied to Ms Wilson – about that decision.
Dr Brown wrote: “Please allow me to thank you and our PLP Government profusely for your support on the issue of reduced payments for CT and MRI scans.”
He added that the public funds would enable Bermuda Healthcare Services to stay open but after an “exhaustive accounting review” it was decided to close Brown-Darrell.
Ms Wedderburn said in September 2018 that Bermuda had an adequate number of scanners for its ageing population.
“If there are too many CT scanners, people may be exposed to too much unnecessary testing and healthcare costs will increase,” she warned.
In January 2019, Dr Attride-Stirling wrote in an e-mail to Ms Wilson that the “financial supplements to both the Brown-Darrell Clinic and the Bermuda Hospitals Board” were “in order to help ensure CT and MRI services are readily available to the public” as well as to avoid reverting to higher fees and pushing up health insurance premiums.
A Government spokeswoman issued a statement on behalf of Mr Burt yesterday, which contained a factual inaccuracy.
The civil servant said: “The Premier did not intervene.
“As the then Minister of Finance and consistent with his authority and responsibility, a proper directive under the law and in line with a Cabinet conclusion was issued.”
She added: “It is a convenient fiction for The Royal Gazette and the Opposition to consistently say that these payments related only to Bermuda Healthcare and Brown-Darrell. They did not.
“The Bermuda Hospitals Board also suffered as a result of the actions of the previous Government and the action taken by this administration was required to also make whole Bermuda’s only acute care hospital.
“Ignoring that fact speaks volumes about the true motivation of the media, and specifically The Royal Gazette.”
The Gazette has repeatedly reported that the publicly-funded BHB received payments to compensate for the reduced scan fees.
A board spokeswoman explained in December 2018 that the grant had to be invested back into services for the public.
“The Bermuda Hospitals Act actually requires BHB to make enough surplus so as not to require additional grants from the public purse to maintain and improve services,” she said.
“By law, therefore, any surplus is always invested in services and the community.”
The Ministry of Health released the correspondence to the RG at the request of the Information Commissioner’s Office, which is reviewing its decision not to disclose certain records.
* To view the records disclosed by the Ministry of Health, click on the PDF in Related Media.
The Ministry of Health disclosed these records to The Royal Gazette at the request of the Information Commissioner’s Office:
• David Burt’s November 22, 2017 directive to health permanent secretary Jennifer Attride-Stirling for grants to be paid to Ewart Brown’s medical clinics and Bermuda Hospitals Board.
• A December 21, 2017 e-mail from Accountant-General Curtis Stovell to Dr Attride-Stirling seeking a copy of the “executed agreement/settlement” with Dr Brown’s clinics in order for payment to be made.
• A media query for the Ministry of Health and Bermuda Health Council about the payments and a related e-mail from Dr Attride-Stirling to a public affairs officer and Tawanna Wedderburn, then chief executive of BHeC. The permanent secretary wrote that the ministry and the council should share their responses before replying or should issue a single response. She wrote: “For example, the legal action against the health council was always misplaced. The ministry could clarify this and divert the misplaced focus on the health council.”
• E-mails between the ministry and the council about how to calculate the payments to the clinics.
• E-mails between the chief financial officer at Dr Brown’s clinics and a health ministry official about calculating payments. An email from the health ministry official was redacted.
• A December 11, 2017 e-mail from a health ministry official to other staff stating that it is “a matter of urgency” to calculate the final grants payable to the clinics and BHB.
• A January 12, 2018 e-mail marked “Urgent Communication” from Dr Brown to Mr Burt, the Premier, thanking him “profusely” for the grants and informing him that the Brown-Darrell Clinic would close.