Bermuda Hospitals Board Issues 2008 Annual Report

Bermuda Hospitals Board (BHB) today announced the publication of its 2008 annual report. The report covers achievements, statistics and audited financials for the fiscal year 2007-8.

Chairman of the Bermuda Hospitals Board, Mr Herman Tucker comments: “This report was delayed by some additional work that was undertaken through the auditing process. Bermuda Hospitals Board is committed to a high level of due diligence and transparency in the reporting of its financial information and I am very pleased to see a full and open account, as well as a review of the many achievements for the fiscal year. I’d like to thank the staff and management for all their hard work. It is extremely encouraging to see the continued progress of our hospitals.”

Chief Executive Officer, Bermuda Hospitals Board, David Hill, says: “While the KEMH Redevelopment Project continues to be a major focus for staff and management, we are committed to making wise investments so that we improve the quality of our services to Bermuda in a cost-effective way. Certainly space is a constraint for our staff and patients, but we are more than bricks and mortar and our staff remain focused on delivering the highest quality of health care services. I am very proud of the work of the BHB family.”

Mr Hill adds: “I would also like to pay tribute to Minister Nelson Bascome. As the front section of this report was drafted some time ago, it includes a message from Minister Bascome. We have kept this introduction as a reminder of his immense contribution to BHB. His support and vision helped set us on our current course of improvement, efficiency and development.”

Highlights for the fiscal year 2007-8 included:
• New 8-slice CT scanner and digital image management system that resulted in next-day appointments for CT scans and radiologist reports being completed within 24 to 48 hours
• 16 new beds in the Continuing Care Unit to help reduce the number of long term patients in acute care beds
• New services and facility for Child & Adolescent Services at Mid-Atlantic Wellness Institute
• Improved waiting times for patients admitted to hospital from Emergency
• New hand occupational therapy service and lymphodaema physiotherapy clinic

The Annual Report is a complete review of the 2007-8 year, along with fully audited financials. In this fiscal year, a surplus of $6.072m was achieved on normal operating activities. There was an additional Actuarial adjustment of $9.271m relating to future employee benefits (mostly health insurance) – an adjustment many Bermuda organisations may have made. Along with the extraordinary loss noted below, this resulted in a final operating loss of $4.149m for the fiscal year. While 2008-9 financials are still awaiting audit sign off, they indicate a return to surplus.

The delay in publishing this annual report was due to an extensive investigation of an extraordinary item about a capital project renovation at MWI, which relates to a significant renovation of Fairview Court. This project was initiated at the end of 2007. Following concerns regarding the management of the project in 2008, BHB undertook its own internal investigations and an independent review by a quantity surveyor, and a staff member was terminated. Details were immediately forwarded to the Auditor General for a full financial investigation and to the Police for potential fraud. A charge of $950,000 has been recorded against income as an extraordinary loss for the year ended 31 March 2008, that represents the difference between the estimated fair value of the assets and the amounts capitalised by BHB. A police investigation has led to three arrests, although the case has yet to go before the courts so BHB is unable to comment further. However, once legal proceedings are complete, BHB will seek financial restitution.

Mr Hill comments: “We have many examples of well-run projects that have been run on-budget and on-time, such as the Lamb Foggo Urgent Care Centre which opened last year, the new Child & Adolescent Services Facility at MWI that opened in 2008 and the Intensive Care Unit in KEMH. We were therefore obviously very disappointed by the management of the Fairview Court project in the initial phase of the project. We expect the highest level of due diligence with our projects and internal controls have increased even further since this case came to light. We will not shy away from full investigations, full disclosure and have zero tolerance where there is a proven violation of policy.”

Following a delay while related investigations took place, the Fairview Court renovation is expected to be completed later this summer. The project has addressed significant roof repairs, complete mould remediation, as well as replacement of HVAC , electrical and fire suppression systems. The cost of the project to date is about $6m, $4m of which was paid by Government grant. BHB is covering the balance.

Link 1: 2008 Annual Report

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