Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1697628213364.pdf (Antigua and Barbuda)
Medical Benefits Scheme 1 2010 Annual Report Addressing National Health Challenges Creating a Better Future 2 Our Theme ‘Addressing National Health Challenges; Creating a Better Future’ is more than mere words.

These words are backed by action.

These words reflect our commitment to you.

They are the catalyst behind our actions and the mantra we use to motivate us along the way.

Worldwide, chronic Non-Communicable Diseases (NCD’s) are increasing at an alarming rate.
We, at the Medical Benefits Scheme, are committed to reducing the threat to Antiguans and Barbudans.

We do continue to reimburse for numerous tests and surgeries, and offer a comprehensive range of medication for covered diseases – asthma, cancer, cardiovascular diseases, diabetes, glaucoma, hypertension, certified lunacy, and sickle cell anaemia – at any of our strategically placed pharmacies.
But rather than simply treating the disease, we’re committed to prevention by promoting healthy lifestyles – primarily physical exercise and proper nutrition.

By so doing, we believe we’ll be creating a better future for all Antiguans and Barbudans.

Vision To be a model organization, which is customer-oriented, and renowned for its service excellence, integrity, accountability and fairness.
3 Mission To contribute to the improvement of the quality of life in Antigua and Barbuda by: » Providing beneficiaries of the Scheme » Providing financial support for the with access to healthcare services construction and maintenance of » Promoting public awareness of the importance of adopting healthy lifestyles healthcare facilities and infrastructure Core Values Service Excellence We will endeavour to not only meet but also to Education and Awareness We will promote the adoption of healthy lifestyles to surpass public expectation through: complement our programmes of curative benefits.
» Providing services at locations that are readily accessed by beneficiaries » Providing timely and reliable services » Using customer satisfaction surveys as the basis for continuous improvement Human Resource Development We recognize that our human resources are among our most valuable assets.

We are committed to equitable hiring, remuneration and promotion practices, and the continued training and development of our staff.
Stewardship We will be effective stewards of the resources with which we are entrusted.

We will: Teamwork We believe that our success is dependent on » Maintain effective mechanisms to ensure our ability to work together, within and between that all contributions due are collected on departments, on the basis of mutual trust and a timely basis respect.
» Exercise prudent financial management and accounting disciplines Ethics Fairness, honesty and integrity will be the » Adopt a framework of transparent public hallmarks of the way we do business.

reporting Collaboration We will foster and develop partnerships with stakeholders and other entities in the pursuit of matters of mutual interest.
Information Systems We will leverage on information systems to enhance our service delivery, and as the basis for identifying and analysing trends to support critical decisions.

Change We will be sensitive to, and adaptive to, the dynamic environment in which we operate.

4 Message from the Minister of Health Hon.


Wilmoth Daniel I extend warmest congratulations to It is noteworthy that this report the board and staff of the Medical focuses on 2010, the same year Benefits Scheme (MBS) on the that saw the enactment of the new production of their inaugural annual Medical Benefits Act that provides the report under the theme, ‘Addressing legal framework that will guide the National Health Challenges: Creating institution as we deal with emerging a Better Future’.
and re-emerging health challenges.

This Act has redefined the Medical Like other countries in the Caribbean, Benefits Board, increased available Antigua and Barbuda is challenged benefits, and empowered the MBS to by increasing Non-Communicable collaborate with statutory and other Diseases (NCDs) such as diabetes and hypertension coupled with bodies established for the purpose of providing health care in Antigua and communicable disease such as HIV/ Barbuda.

As we continue to move AIDS and dengue.


forward, I envisage the development of National Health Insurance in The Medical Benefits Scheme Antigua and Barbuda and the continues to assist its beneficiaries provision of medication and supplies by providing medication for chronic for a wider range of diseases.

NCDs including diabetes and hypertension.

The Scheme has also The production of an annual report assisted indirectly with communicable is no easy task.
I acknowledge the diseases by partnering with the hard work of staff involved both in government on its network of its production and in the work done community health clinics and in- in the year under review.

Heartiest patient care at Mount St. John congratulations on this significant Medical Centre.

achievement.

Let’s continue to work together to ensure the health and well-being of Antiguans and Barbudans.
5 Chairperson’s Remarks It gives me great pleasure to be part of protection of its staff vehicles is now one this Annual Report of the Medical Benefits of the Scheme’s assets.

Scheme (MBS).

As an advocate of records and reports, it with a governing statutory instrument that is gratifying to publicise the achievement was 32 years old (i.e.

the MBS Act of 1978 The greatest challenge was operating of the Scheme under the theme (Cap 271).

“Addressing National Health Challenges: Creating a Better Future”.
It is pleasing to note that MBS now operates with a new Act, passed in 2010.

Medical Benefits, like other institutions, This new Act provides, among other faced many challenges, both internally benefits, for the increase in beneficiaries’ and legislatively, in its quest to provide claims.

Two new medical conditions have improved services to its beneficiaries.

been added to the list of diseases and self-employed persons are now registrants The Board had to address the matter of of the Scheme.
The new MBS Act of inadequate operation space brought about 2010 and its Regulations are available by the demand on staff to administer to an for all residents to assist them to better increased number of registrants, and the understand the Scheme and its operations.

consequent effect on morale among the staff and on relations between directors The Scheme has a Prevention Unit which and staff.

Conflicts must not be viewed is managed by a medical personnel.
This negatively, but should instead be used unit has, over the years, successfully taken as channels through which interpersonal its programmes to the front doors of relationships can be improved.

The the beneficiaries and to the community Board, knowing that poor interpersonal at large.
The following tests are done relationships results in low productivity, during these road shows: diabetes, developed a strategy of having bi-annual eye problems, cholesterol and prostate staff meetings in an atmosphere of testing - the test men fear most.

The information sharing with mutual respect.

In programme focuses on prevention, addition, and intervention retreat was held detection, and referral.

with the aim of transforming the Scheme into a high performance workplace.
I am The stated achievements were not convinced that the gap between directors attained by any one entity, but by and staff is narrowing and can be graded as the collaborative efforts of the legal satisfactory.

Although the maintenance of department, the board, management, and staff morale is a continuous process, there staff of the MBS.
Accordingly, I wish on are obvious signs of a significantly improved behalf of the other directors, to express working relationship among MBS staff, and my feelings of gratitude and to say thank commendations are extended to them.

you to all who played pivotal roles in attaining these achievements at the MBS To resolve the issue of the inadequate during the reporting period.

operational space, the Scheme acquired a new building on Nevis Ann Edwards (Mrs.) Street.
Additionally, a parking lot for the Chairperson, MBS 2010 6 Medical Benefits Scheme Board of Control MBS oversight falls into the laps of the members of the MBS Board of Control, the varied and capable team responsible for ensuring the proper functioning of the Scheme to the benefit of all its stakeholders.
That team currently consists of: Mrs. Ann Edwards, Chairperson Mr. Egbert Joseph A retired health and education Trade unionist Egbert Joseph serves professional, Nurse Edwards as both the president of the Antigua brings to the MBS Board of and Barbuda Hotel Management Control, leadership skills honed Association and 1st vice president as the longest serving president of the Antigua and Barbuda Trade of the Antigua and Barbuda Union Congress.
His knowledge of Nurses Association and as deputy industrial and labour relations makes superintendent of public health him an invaluable asset to the MBS nurses.

team.

Mr. Herbert Dyett Ms. Natasha Mussington Mr.
Acres Stowe A pharmacist for more than a Natasha Mussington represents As general manager of Illuminat, quarter century – in both the public the Antigua and Barbuda Trade a technology-driven firm, and the and private domain – Herbert Dyett Union Congress on the MBS Board, Antigua and Barbuda Employers’ brings to bear his in-depth insight bringing her experience in the human Federation representative, Acres with respect to pharmaceutical resources aspect of labour relations Stowe’s management experience is operations.
to the table.

The air traffic controller an asset to the MBS Board.

at the V.C.

Bird International Airport has served as general secretary of the TUC for two years.
7 Dr. Conrad Stevens Mrs. Joan Samuel Mr. Damani Tabor Dr. Stevens represents key A retired nurse who gave over As a science teacher by profession stakeholder the Antigua and forty-two years of service to the who then left the service to Barbuda Medical Association on the profession, Mrs Samuel has vast pursue his passion for information MBS Board of Control.

knowledge of the public health care technology full time, Mr Tabor system.
advocates the leveraging of She represents the Antigua and technology to deliver greater value Barbuda Nurses Association on the for the beneficiaries of MBS.

Board.
Board.

Mr. Caudley George Mrs. Joanne Lovell Mr. Danzlear Dublin A Journalist by profession, Mr As a career banker with a focus A former banker now self employed George brings a wider perspective on management, compliance and businessman, Danzlear Dublin is to the board and focuses on investment, Mrs Lovell adds to the one of six government nominees on the optimum utilisation of MBS depth of knowledge at the Board’s the Medical Benefits Board.

He also resources, particularly its human fingertips.
resources.

serves on the human resource sub- committee of the Board.

8 Upclose With Three MBS Board Sub-Committies The Human Resources Committee the Board should assist with course has a multitude of responsibilities tuition payments.

with an emphasis on employee development.

Duties include Employee benefits also fall under this establishing compensation and committee’s purview.
The committee benefits for senior officers; facilitating receives reports on the operation the selection and development and admission of employee of key managers; and assessing benefits; and oversees the educational needs of MBS the administration of employees with an eye toward the MBS’ Benefit recommending staff development Plan and other programmes at all levels.

incentives, Furthermore, if individual employees including wish to upgrade their skills, this is the awards.
committee that receives, assesses, and recommends whether or not Meanwhile, the Audit and Risk Committee assists the board of directors in fulfilling its oversight responsibilities in several areas.

Specifically, it keeps an eagle eye on the integrity of the company’s financial statements; compliance with legal and regulatory requirements; the independent auditor’s qualifications and autonomy; and the performance of both the company’s internal audit function and independent auditors.
9 Finally, the Investment Committee seeks to maximize returns and minimize risks on investment in accordance with the Medical Benefits Act.

It, also, administers the MBS Investment Plan.

This includes receiving reports from management on the operation of the plan, monitoring and evaluating the performance of the investments portfolio, and submitting a bi-annual report to the board of directors.
10 Executive Team Mr. Cottrille George MBS Superintendent Mr. George has had an extensive career at the Antigua and Barbuda Social Security Scheme where he rose through the ranks from statistician to deputy director, a position he held for fourteen years.

He later joined the Medical Benefits Scheme in 2000 as its leader, occupying the chair of superintendent.

His professional qualification is in business and management.
Mr. Pierre Richardson Chief Operations Officer During the past five years, Mr. Richardson has served, at the executive level, as chief operations officer, optimizing the operations of departments within the span of his control.

Prior to that, he worked at the middle management level as information technology manager, managing the establishment and development of the Scheme’s IT department and operations for more than eleven years.
He holds a Master of Business Administration degree and a Bachelors of Science degree in Business Administration with a concentration in Management Information Systems (honours).

Ms. Lilia Manwarren Manager Human Resources Ms. Manwarren has been employed with MBS from its early years; 1979.

She has worked in most of the departments within the organisation, and was once the supervisor of invigilators and manger of the benefits, reconciliation and invigilator departments.
She is currently the manager of human resources and has held that position since 2004.

Dr. Leslie Walwyn Medical Officer A medical practioner with certification in public health Dr. Walwyn has been been spearheading MBS’ diseases prevention agenda over the last seven years, advocating regular screenings, proper nutrition and regular physical activity.
Ms. Laurel Mason Chief Financial Officer Ms. Mason joined the MBS team in August 2008 as the senior accountant and after a period of two years, she took up the position of chief financial officer.

She has over fifteen years accounting experience and has worked in a range of industries including aviation and insurance, holding various accounting positions at different levels prior to working at the executive management level at MBS.
Managers and Department Heads 11 Janelle Charles-Williams Communications and Garylyn Archibald Sonier Edwards Angie Bascus Marketing Manager Credit Control Manager Customer Service Manager Internal Auditor Vernon Benjamin Assistant Pharmacy Hubert Brown Michael Bowen Pharmacy Manager Manager IT Manager Technical Support Officer Algernon Roberts Supervisors Nathlie Swift Prevention Unit Sharon Butters Customer Service Department Bridgette Williams Benefits Department Norma Jarvis Reconciliation & Enforcement Department Fancier Skepple Data Entry 2 Department Sharon Farell Head Cleaner Bevon Mathias Pharmacy Department Idona Hector Data Entry 1 Department Andre Bovell Procurement Department Barrymore Chambers Compliance Department Morris Samuel Head Maintenance Department Dorothy Graham Nutrition Officer 12 From The Desk of the Superintendent The Medical Benefits Scheme has been disease-specific programmes are strong in existence for 32 years, a lifetime to evidence of the Scheme’s determination many and a lifesaver to many more.
It has, to promote health and wellness for all over the years, been a major support, citizens and residents of Antigua and supplying costly medication, at no cost, Barbuda.

for nine legislated Non Communicable Diseases (NCDs).

Over the last 10 years, it Also, during the period under review has reinvented itself as an active promoter – 2010 – there were two new and of health and wellness.
No wonder then noteworthy achievements: that the Scheme has grown to become an » The enactment of the new Medical irreplaceable part of the health care system Benefits Act, 2010; and in Antigua and Barbuda.
» The launch of the new Smart Card Initiative The MBS has pursued the health and wellness campaign, while maintaining The Medical Benefits Act 2010 and improving its core traditional Previously, all MBS benefits and services functions and services: assistance for had been governed by the Medical overseas treatment, medications for the Benefits Act of 1979 CAP 271 and its nine listed diseases, hospitalizations, related regulations.
financial assistance for medical investigations and other services, and In 2001, the Board decided it was financial assistance to the government of time for an upgrade, and engaged the Antigua and Barbuda in the construction services of a leading Caribbean legal and maintenance of hospitals and clinics.

luminary to take charge of this process.

The new draft Act was the outcome.


It Driving this prevention agenda over the set the stage for, among other things: last decade was the adoption of the » The establishment of a Board’s Statement of Policy Objectives in representative Board 2002.This Statement challenged the MBS » Increasing the amounts refunded to be less reactive and more proactive.
for benefits » Increasing the number of covered It reads, in part: diseases The Board believes that in addition to providing funding for the treatment of chronic diseases, the Scheme should also play a role in measures for their prevention and control.

In particular, the Board believes that it is necessary to better understand the causes of these diseases, and to support programs to promote healthy behaviours.
» The compulsory coverage of self- employed persons » The voluntary registration of unemployed persons Generally speaking, this new Act forms the basis for the long overdue reform of the Medical Benefits Scheme to address Frequent screening programmes all National Health Challenges and create around Antigua and Barbuda, school a better future for all Antiguans and outreach programmes, road shows, and Barbudians.
13 MBS Smart Card Initiative Accurate personal identification has with an international provider for attending physician will insert the the delivery of a Smart Card system card into a special reader and issue been one of the greatest challenges to replace the current cards.

These the prescription electronically.

The for MBS over the years.


The current cards will double as a picture ID and prescription will then be filled at one MBS card without a picture ID is a Health Card which will support of our pharmacies and our computer known to be a means of fraudulent electronic prescriptions and other system will be updated in real time.

activities such as persons receiving medical services.
medications from our network of This paperless approach will enhance the management of the organization pharmacies, and services from our For example, a beneficiary who visits by improving efficiency and customer public hospital which they are not a doctor for one of the listed diseases service; it will also reduce or eliminate qualified to receive.

MBS has will be required to present his/her fraudulent activities.

entered into contractual agreement smart card for authentication.
The Core Traditional Services Payment of Contributions Beneficiaries The economic slow-down has The Medical Benefits Scheme offers A total of 1428 persons were screened in 2010 by these voluntary impacted intake at the Medical health care assistance to a wide cross- groups.

Benefits Scheme.

But the Scheme section of the population of Antigua has been able to stem the tide and Barbuda.
This includes: Business Registration and Closure mainly due to the consistent payment » Children under the age of During the year 2010, 696 new of contributions by those loyal sixteen years businesses were registered.
These employers who have ensured that the » Persons over the age of 60 years include self-employed persons and contributions held in trust for their » Persons with one or more of the represent an increase of 19% over employees are paid into the Scheme diseases covered by the Scheme, the year 2009 where the number on a timely basis.
In 2010, our cash and of businesses registered was 585. collections of EC $73.6 million was » Persons who would have paid However, the number of closed an increase of 23% over the previous 26 weekly contributions into the business for the year was significant.

year.

This was due mainly to monthly Scheme within one calendar year.
Three hundred and eighty four contributions paid by the largest (384) businesses were closed which employer, central government, Apart from refunding these represents a 60% increase over the amounting to EC $16.8 million.

persons for services outlined in the previous year, 2009.
This high rate regulations, MBS provides a number of business closure – 55% of the Regular payment of contributions by of screening and educational services number of new businesses registered employers is the best way to ensure for the general public.

- is cause for concern to the Board that the Scheme is well positioned and management of MBS.
to effectively address health care Our quarterly screenings at major challenges and needs in Antigua and supermarkets in Antigua and also at Business Registration and Closures Barbuda.

our annual road show screened over 2,375 people.

A number of critical cases were refered for further medical investigations.
Number Registered Number Closed 2008 2009 2010 420 585 696 - 240 384 Additionally, MBS supports churches and community groups by providing health supplies and equipment for their local health fairs and screenings.

14 3 .

5 % ertensio n 2 yp H % 6 .

5 1 r a l u c s a v o i d r a C 2010 Pharmacy Expenditures by Diseases Diabetes 16.8 % C a n c e r 2 6 .

8 % Others 17.3% .

3 % 7 O th e rs 1 Cardio v a s c u l a r 2 5 .

6 % 2010 Prescriptions Filled at Pharamacies by Diseases % 9 .
9 1 s e t e b a i D n 3 7.2 % Hype r t e n s i o Pharmacy Services Looking Ahead The procurement of medication The year 2010 will serve as the for the beneficiaries of the Scheme platform from which many new constitutes the largest single expense initiatives emerge.

First, the form for MBS.

For 2010, EC $15.172 and structure of the Medical Benefits million was spent on procuring Scheme will transition into a full- medications for the diseases covered fledged National Health Insurance by the Scheme.
As is shown, the Scheme or some hybrid version expenditure for cancer has exploded to better serve the health care in 2010 constituting 26.8% of our needs of our people.

MBS’ fight medication bill even though the least against chronic Non-Communicable number of prescriptions seen at our Diseases (NCDs) will intensify with pharmacies is for cancer patients – a new and innovative strategies and mere 1.2%.
It means that the cost to programmes that will increase provide medication for one cancer national conciousness and create a patient is exponentially higher than healthier Antigua and Barbuda.

for any other disease.

Of our six pharmacy locations, the main pharmacy at Nevis Street handles Superintendent 46% of our prescription load.
The Cottrille L. George 1 two younger and smaller pharmacies – Johnson’s Point and Grays Farm – are opened to the public until 1:00 p.m. daily but handle only 11% of our prescription load between them.

Types of Claims Apart from receiving medications for one or more of the listed diseases, beneficiaries are entitled to refunds for a range of medical services and investigations.

These include lab tests, ultra sounds and X-rays, MRI and CT Scans, mammograms, pap smears, surgeries, and EKG/ECGs.
Of the 8,978 claims for refunds processed in 2010, 5565 (62.0%) were for lab tests and 1855 (20.1%) were for ultra sounds and x-rays.
Cancer 26.8%Hypertension 23.5%Cardiovascular 15.6%Diabetes 16.8%Others 17.3%2010 Pharmacy Expenditures by Diseases Cardiovascular 25.6%Others 17.3%Diabetes 19.9%Hypertension 37.2%2010 Prescriptions Filled at Pharamacies by Diseases 15 Financial Highlights 2010 was a tough year for many Meanwhile, interest income rose economies, including Antigua & slightly to $3.897million in 2010 from Barbuda.
Many businesses, especially $3.828 million in 2009. those dependent on tourism, saw significant decline in revenue.

A Operating Expenses number of small businesses were The scheme continues to ensure unable to weather the economic that controllable costs are contained storm and sunk.

As a result of where possible.

Efforts are made to downsizing and business closures, exploit technology and other areas to Medical Benefit Scheme experienced keep costs down.
a 21% fall in private sector revenue in 2010, when compared to the same The key components of the period in 2009.

The total impact organisation’s cost are: of the fall in revenue contribution 1.
Direct expenses, which consist Direct Expenses 15,172 10,524 Pharmaceutical Supplies 1,395 1,536 Services & Other Claims 1,151 1,138 Laboratory Benefit Claims Direct Expenses 2010 Direct Expenses 2009 was reduced due to the fact that of reimbursement for claims Net Surplus central government paid its 2010 made by our beneficiaries and Overall, the organisation realized a contributions.

Revenue Mix purchase of pharmaceutical net surplus of $22.888 million.
This is supplies distributed through our a remarkable performance, especially pharmacy network; in these trying economic times.

Our major source of revenue is the 2.

Administrative costs which are 7% contribution paid on employees’ primarily salaries, wages and Ministry of Health Donations earnings.

This is classified into allowance as well as offices Expenses paid on behalf of the private and government contribution.

expenses; and Ministry of Health amounted to Another significant revenue category 3.
Donations to the Ministry of $23.543 million, down from $25.028 is interest from investment.

Health.

million in 2009.
This expense The diagram below outlines the expenses are as follows: for pharmaceutical supplies for the revenue mix for 2010: central medical stores and loan Schedules of our 2010 direct category includes payments made I n t e rest 5% ernment 2 2 % v o G Revenue Mix % 3 a te Sector 7 P ri v Direct Expenses payment on behalf of Mount 2010 $000 2009 $000 15,172 10,524 1,395 1,536 1,151 1,138 Pharmaceutical Supplies Services & Other Claims Laboratory Benefit Claims TOTAL 17,718 13,198 St. John’s Medical Centre.
Going forward, the financial climate is expected to be similarly challenging.

However, the Medical Benefits Scheme is committed to its beneficiaries and will continue to innovate and utilise its resources in an efficient and effective manner to sustain services.

Private Sector 73%Government 22%Interest5%Revenue Mix 16 MBS Pharmacy Department Always there to serve you are a part of the government available at the other units.

The only The Pharmacy Department is one of clinic services.
There, beneficiaries exception is Special Authorized Drugs the critical engines of the Medical seeking medical attention can (SAD),processed exclusively at the Benefits Scheme (MBS) machine.

access MBS dispensing services for Nevis Street unit.

This department came into being in pharmaceuticals related, but not August 1990.

Its main function is to limited, to the covered illnesses.
The Average Number of Prescriptions Serviced Monthly provide pharmaceutical care for all beneficiaries who may be suffering The average number of prescriptions from one or more of the nine (9) processed at the six MBS pharmacy chronic diseases covered by the MBS locations on a monthly basis are regulation: Hypertension; Diabetes represented as follows: Mellitus; Cancer; Leprosy; Asthma; Glaucoma; Cardiovascular diseases; The Average Number of Certified Lunacy; and Sickle Cell Prescriptions Serviced Monthly Anaemia.
It should be noted that two (2) additional chronic diseases – Parkinson’s and Epilepsy – will be added to the MBS lists of illnesses in accordance with new MBS legislation.

The procurement department which was established to deal effectively with the sourcing, purchasing and distribution of MBS’ pharmacuticals will be even more critical.

As a result, MBS pharmacies usually stock both brand and generic drugs – at a ratio of 1:1 – from a number of the world’s leading manufacturers and distributors.
Unit Average # of Amount location Prescription in % Serviced Monthly Nevis Street Clarehall Browne’s Ave All Saint’s Johnson’s Point Gray’s Farm 5,299 46.4% 1,941 1,549 17.0% 13.6% 1,335 11.7% 616 5.3% 684 6.0% The data in the above table indicates that the Nevis Street Unit is the most 46.4% Nevis Street: 5,299 17.0% Clarehall: 1,941 13.6% Browne’s Ave: 1,549 11.7% All Saint’s: 1,335 5.3% Johnson’s Point: 616 6.0% Gray’s Farm: 684 This graphical representation above gives the average number of prescriptions that are processed at each MBS dispensing unit.
One of the aims of MBS is to bring utilized of these six pharmacies.

By pharmaceutical care to the door-step contrast, the Johnson’s Point unit How vital is the service provided by of each beneficiary.

To wit, MBS has is the least utilized on a monthly the MBS pharmacy department?

Well, established a number of satellites basis.


The management team of consider this, the Medical Benefits pharmacies in various locations MBS will intensify its communications pharmacies dispense over twelve throughout Antigua and Barbuda.

campaign to advise beneficiaries thousand (12, 000) prescriptions To date, there are functional satellite of the advantages of utilising the monthly.

On average, each pharmacies in Clare Hall, Browne’s pharmacy closest to their home.
prescription consists of four (4) items.

Avenue, All Saint’s, Johnson’s Point Beneficiaries should be aware that Do the math.

and Gray’s Farm respectively.

At these all the pharmaceuticals offered locations, the satellite pharmacies at the Nevis Street unit are also 17 It should be noted that MBS’ pharmacies also provide prescriptions services to many of the other health institutions.
These include: Mount St. John’s Medical Centre; the Fiennes Institute; Clare Vue Psychiatric Hospital; Her Majesty’s Prison; all registered nursing homes; and the Hanna Thomas Hospital in Barbuda.

The first half of the year utilized a higher portion of the expenditure than the latter half.

In addition, purchase amounts peaked in the month of April.

What next for the MBS pharmacy department?


It’s fair to assume that in the current economic climate, people will be utilizing our services more in light of their own diminished means.

We will be challenged to respond to this demand and to do so while improving and maintaining the quality of our service to both internal and external clientele.

For many, we are the contact point and as such the face of the MBS.

We must foster a good relationship with the community.
We will achieve this through continuous internal training and public education programmes.

The economic climate also challenges us to better manage our scarce resources; as such, proper storage and usage of all pharmaceuticals cannot be overemphasized.

In other words, all forms of wastage must be prohibited and non compliance reduced.

Lives are at stake.
Lives are at stake.

18 Addressing National Health Challenges; Creating a Better Future for All Since its inception the Medical Preventing lifestyle related chronic lectures on maintaining good health Benefits Scheme (MBS) has witnessed diseases means changing dietary and nutrition, and timely detection dramatic increases in lifestyle diseases habits and physical activity levels.

and management of glaucoma and – diabetes, hypertension, heart Screening is also critical to identifying prostate cancer.
Each Road Show disease, cancers – across all age and reversing the disease track.

In was packed with fun-filled physical groups.

The associated complications 2010 MBS expanded its screening activities for the public and included and costs are astronomical.

activity, assisting faith based and non its first Cycle of Life.

This new physical Clearly, equipping people with materials.

Thousands have been racing, hoola hooping, and bicycling medications, while an admirable first screened as a result.
– all designed to keep people active.

profit organizations with screening activity based event featured tyre step, would not be enough.

So it was that in 2003, MBS experienced a paradigm shift from simply managing Bigger, better and far more comprehensive is the MBS Road The annual MBS Healthy Recipe Competition, meanwhile, brought disease to preventing disease.

Since Show.
Since Show.

In June 2010, MBS provided mouth-watering dishes to the palates that time its activities have been screening for the ‘usual culprit’ of curious beneficiaries and winning more proactive, and so effective that diseases but also incorporated recipes were featured in the 2011 they’ve been admired and replicated screening for breast cancer, prostate MBS calendar.

in other countries.

cancer and glaucoma.


In-house experts also provided free public 19 Lifestyle diseases such as diabetes can be controlled and in a few cases reversed by making Therapeutic Lifestyle Choices (TLC).

However, applying the correct TLC requires education and motivation.

In January 2010, MBS graciously accepted assistance from the University of Florida and introduced its “Take Charge of Your Diabetes” (TCYD) programme to persons with Diabetes.
To get the programme going five highly educated professionals formed the team that trained forty participants within the health field from the Medical Benefits Scheme, the Ministry of Health, and Mount St. John Medical Centre.

With the knowledge gained and through a collaborative effort there is now from these three institutions, TCYD a waiting list to classes introduced people get into the TCYD living with diabetes to tools programme.

for better living.
for better living.

These classes were held at Children – whom it is MBS and the in both the primary and secondary MBS in the evenings community’s legal responsibility to settings.

Parents testified that their and graduates protect – were also at risk from Non children lost weight and practiced were empowered Communicable Diseases (NCDs).

avidly to win trophies and medals.

to make better food choices, incorporate Action taken had to factor them in.
In fact, in time, the entire country MBS rose to the challenge.

It joined hands in 2008 with the Ministries seemed to be skipping.

Children began to skip outside of competition exercise into their of Education, Sports, and Health time.

The PAN skip rope competitions daily routine, and ultimately take charge of their health.

to create multiple interventions all have gained respect on the school grouped together as the Physical sports calendar as events through Activity and Nutrition (PAN) Project.
which school pride can be bolstered and trophies won.

MBS was actually They experienced PAN Project activities in 2010 successful in prompting lifestyle improvements in included the extremely popular change among the nation’s youth.

their health that National Skip Rope Competition- were mostly due to both individual and team based.

We had the opportunity to share the their own actions, and Speed and agility – plus incredible success of this PAN Project, along not their physician’s.
A sportsmanship – were displayed by with others such as the Smart Dollar testament to its popularity, hundreds of participating athletes Recipe Competition, at the 5th 20 TThe PAN Skip Rope Competitions have gained respect on the school sports calendar as events through which school pride can be bolstered and trophies won.

Caribbean Conference on National Health Financing Initiatives in Belize in November 2010.
Also, in Dominica, in December 2010, MBS was invited to share its success in tackling childhood obesity with its neighbour via a nationwide address.

Dominica has since introduced a hoola hoop programme and is reporting success with this initiative.

We are happy to share.

After all, our own programme has benefited from local, regional and international partnerships.
Kudos to the staff for their creativity in tackling a crippling national lifestyle and to the leadership that recognized good ideas when they saw it and wasn’t shy about blazing a trail.

The proof of its efforts will be in the healthier and more expansive lifespan enjoyed by all.
21 Medical Benefits Scheme Financial Statements December 31, 2009 Table of Contents Independence Auditor’s Report to the Board of Directors....................22 - 23 Statement of Financial Position ....................................................................24 Statement of Comprehensive Income and Expenditure ..............................25 Statement of Accumulated Surplus ..............................................................26 Statement of Cash Flows ..............................................................................27 Notes to Financial Statements ..............................................................28 - 42 22 23 24 25 MEDICAL BENEFITS SCHEME Statement of Comprehensive Income and Expenditure Year ended December 31, 2009 with comparative figures for 2008 (Expressed in Eastern Caribbean Dollars) Income: Contributions and surcharges Direct Expenses: Pharmacy drugs dispensation Drugs, medical supplies and services Benefits paid Notes 2009 2008 13 $ 81,320,094 84,036,151 10,523,576 1,684,958 1,137,687 11,401,653 1,718,408 1,173,072 13,346,221 14,293,133 Surplus of contributions over benefits 67,973,873 69,743,018 Expenses/(Other Income): Administrative expenses Bad debt expense Interest expense Amortisation and depreciation Interest income Other income Impairment loss 14 4 10, 11 15,032,605 267,116 10 1,177,470 (3,828,114) (62,495) 14,764,447 56,822 126 1,173,122 (5,015,985) (6) 6 1,685,544 1,944,720 14,272,136 12,923,246 Income before donations 53,701,737 56,819,772 Donation
 to the Ministry of Health 15 25,028,430 32,071,001 Net income for the year $ 28,673,307 24,748,771 Total comprehensive income $ 28,673,307 24,748,771 The notes on pages 7 to 21 are an integral part of these financial statements.
4 26 MEDICAL BENEFITS SCHEME Statement of Accumulated Surplus Year ended December 31, 2009 with comparative figures for 2008 (Expressed in Eastern Caribbean Dollars) Balance at January 01, 2008 Net income for the year Balance at December 31, 2008 Net income for the year Accumulated Surplus $ 318,350,880 24,748,771 343,099,651 28,673,307 Balance at December 31, 2009 $ 371,772,958 The notes on pages 7 to 21 are an integral part of these financial statements.
5 27 MEDICAL BENEFITS SCHEME Statement of Cash Flows Year ended December 31, 2009 with comparative figures for 2008 (Expressed in Eastern Caribbean Dollars) Cash flows from operating activities Net income for the year Adjustments for: Provision for doubtful accounts Provision for impairment Amortisation and depreciation Pension expense Interest expense Interest income Notes 2009 2008 6 10, 11 $ 28,673,307 24,748,771 267,116 1,685,544 1,177,470 2,057,770 10 (3,828,114) 56,822 1,944,720 1,173,122 1,822,072 126 (5,015,985) 24,729,648 Operating income before changes in working capital (568,219) Increase in contributions receivable (93,599) (Decrease)/increase in other receivable Increase in inventories (5,009,929) (1,562,438) Increase in prepayments (30,392) (77,803) (292,780) (285,306) Increase in Quasi-government receivables (3,098,121) (18,480,000) Increase in due from Government of Antigua and Barbuda (Decrease)/increase in accounts payable and accruals 475,648 (401,793) (10,810) (13,601) Decrease in deferred interest 19,506,209 Cash generated from operations (126) Interest paid (242,939) Pensions paid 30,033,103 (2,710,716) 151,009 (10) (120,857) 3,247,692 Net cash provided by operating activities 3,126,825 19,263,144 Cash flows from investing activities Investments Purchase of property and equipment Purchase of intangible assets Interest received 11 10 12,242,676 (14,140,479) (257,124) 4,443,734 (23,346,650) (23,941) (441,285) 4,256,346 Net cash provided by/(used in) investing activities 2,288,807
 (19,555,530) Increase/(decrease) in cash and cash equivalents 5,415,632 (292,386) Cash and cash equivalents, beginning of year 6,216,902 6,509,288 Cash and cash equivalents, end of year $ 11,632,534 6,216,902 Represented by: Cash in hand and at bank $ 11,632,534 6,216,902 The notes on pages 7 to 21 are an integral part of these financial statements.
6 28 MEDICAL BENEFITS SCHEME Notes to Financial Statements December 31, 2009 1.

Reporting Entity: 2.

(a) (b) (c) (d) The Medical Benefits Scheme (the Scheme) was established under the provisions of the Medical Benefits Act 1978 as amended to provide financial and other assistance towards the cost of medical services in Antigua and Barbuda.

The Scheme operates from premises located on Nevis Street, St. John’s, Antigua.
Basis of Preparation Statement of Compliance: These financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) and comply with the provisions of the Medical Benefits Act.

The financial statements were approved by the Board of Directors on June 29, 2011.

Basis of Preparation: The financial statements have been prepared on the historical cost basis.
Functional and Presentation Currency: The financial statements are presented in Eastern Caribbean dollars which is the Scheme’s functional currency.

All financial information presented in Eastern Caribbean Dollars has been rounded to the nearest dollar.
Use of Estimates and Judgments: The preparation of financial statements requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses.

Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis.
Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.

7 29 MEDICAL BENEFITS SCHEME Notes to Financial Statements (cont’d) December 31, 2009 2.
Basis of Preparation: (cont’d) (e) Changes in Accounting Policies and Disclosures: The accounting policies adopted are consistent with those of the previous financial year except the adoption of revised International Financial Reporting Standards (IFRS) as mentioned below: Accounting Standards Effective Date Revised IAS 1 Presentation of Financial Statements 1 January, 2009 Revised IAS 23 Borrowing Costs 1 January, 2009   Revised IAS 1, Presentation of Financial Statements, introduces as a financial statement (formerly “primary” statement) the “statement of comprehensive income” (i.e., changes in equity during a period, other than those changes resulting from transactions with owners in their capacity as owners), which is presented either in : (a) one statement (i.e, a statement of comprehensive income); or (b) two statements (i.e., an income statement and a statement beginning with profit or loss and displaying components of other comprehensive income).
The revised standard also prohibits presenting components of comprehensive income in the statement of accumulated surplus.
Other requirements in the revised standard that are not current IAS 1 requirement includes: (a) a statement of financial position (formerly “balance sheet”) is required at the beginning of the earliest comparative period following a change in accounting policy, the correction of an error or the reclassification of items in the financial statements; (b) reclassification adjustments to profit or loss of amounts previously recognized in other comprehensive income (formerly “recycling”) are disclosed for each component of other comprehensive income; (c) income tax is disclosed for each component of other comprehensive income; (d) dividends and related per-share amounts are disclosed either on the face of the statement accumulated surplus or in the notes.
Revised IAS 1, which is mandatory for 2009 financial statements, only impacts the presentation aspects of the Scheme’s financial statements.

Revised IAS 23, Borrowing Costs, removes the option of immediately recognising all borrowing costs as an expense, which was the benchmark treatment in the previous standard.
The revised standard requires that an entity capitalise borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset as part of the cost of that asset.

Revised IAS 23, which is mandatory for 2009 financial statements, does not have any significant impact on the Scheme’s financial statements.

8 30 MEDICAL BENEFITS SCHEME Notes to Financial Statements (cont’d) December 31, 2009 2.
Basis of Preparation: (cont’d) (f) New Standards and Interpretations not yet Adopted: A number of new standards, amendments to standards and interpretations are not yet effective for the year ended December 31, 2009, and have not been applied in preparing these financial statements.

None of these will have an effect on the financial statements of the Scheme.

3.
3.

Summary of Significant Accounting Policies: The significant accounting policies adopted in the preparation of these financial statements by the Scheme are as follows: (a) Cash in Hand at Bank: Cash in hand and at bank comprise cash balances.

Bank overdraft is repayable on demand forms an integral part of the business and is included as a component of cash in hand and at bank for the purpose of the statement of the cash flows.
(b) Contributions Receivable and Other Receivables: Contributions receivable from Government and private sector is recorded on an accrual basis.

Other receivables are stated at their cost less impairment losses.

(c) (d) Inventories: Inventories are measured at the lower of cost and net realisable value.

Cost of inventories is based on the first in first out principle, and includes only the purchase cost of the inventory items.
Intangible Assets: Intangible assets represent computer software and are stated at cost less accumulated amortisation and impairment losses.

Intangible assets are amortised over three to five (3-5) years, from the date that they are available for use.

9 31 MEDICAL BENEFITS SCHEME Notes to Financial Statements (cont’d) December 31, 2009 3.
(e) (f) (g) (h) Summary of Significant Accounting Policies: (cont’d) Property and Equipment: Property and equipment are stated at their cost less accumulated depreciation and impairment losses.

The costs of repairs and replacements of a routine nature are charged to the statement of comprehensive income and expenditure whilst those expenditure that improve or extend the useful life of the assets are capitalised.
Depreciation is provided on property and equipment using the straight line method at rates considered adequate to write off the cost of this depreciable property and equipment, less residual value, over their estimated useful lives.
The annual rates used are as follows: Buildings Office furniture and equipment Computer equipment Motor vehicles Generator 2% per annum 20% per annum 20%-33 1/2% per annum 20% per annum 10% per annum Income Recognition: Contribution income and surcharges are recognized on an accrual basis in the statement of comprehensive income and expenditure.

Direct Expenses: Direct expenses are recognised in the statement of comprehensive income and expenditure on an accrual basis as they are incurred.
Provisions: Provisions are recognised when the Scheme has a present legal or constructive obligation as a result of past events, if it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate of the amount can be made.

(i) Investments: Investments classified as held to maturity are stated at amortised cost.

Interest earned while holding such deposits is reported as interest income.
Held to maturity investments for which fair values cannot be measured reliably are recognised at cost less impairment.

When the investments are disposed of or impaired, the related accumulated fair value adjustments are included in the statement of comprehensive income and expenditure as gains and losses from investments.

10 32 MEDICAL BENEFITS SCHEME Notes to Financial Statements (cont’d) December 31, 2009 3.
(j) (k) (l) Summary of Significant Accounting Policies: (cont’d) Impairment: The carrying amounts of the Medical Benefit Scheme’s assets, other than inventories, are reviewed at each statement of financial position date to determine whether there is any indication of impairment.

If any such indication exists, the asset’s recoverable amount is estimated.

An impairment loss is recognised whenever the carrying amount of an asset or its cash-generated unit exceeds its recoverable amount.
Impairment losses are recognised in the statement of comprehensive income and expenditure.

Accounts Payable: Accounts payable are stated at cost.

Foreign Currency Transactions: Transactions in foreign currencies are translated at the foreign exchange rate ruling at the date of the transaction.

Monetary assets and liabilities denominated in foreign currencies at the statement of financial position date are translated to Eastern Caribbean Dollars at the foreign exchange rate ruling at that date.
Foreign exchange differences arising on translation are recognised in the statement of comprehensive income and expenditure.

Non-monetary assets and liabilities denominated in foreign currencies that are stated at fair value are translated to Eastern Caribbean Dollars at foreign exchange rates ruling at the dates the values were determined.

(m) Employee Benefits: The Scheme has an unfunded non-contributory defined benefit plan covering substantially all of its regular employees.
The Scheme’s net obligation in respect of its pension plan is calculated by estimating the amount of future benefits that employees have earned in return for their services in the current and prior periods.

The benefit is discounted to determine its present value, and the fair value of any plan assets is deducted.

The discounted rate is to yield at the statement of financial position date of long-term government bonds that have maturity dates approximating the terms of the Scheme’s plans.
The calculation is performed by a qualified actuary using the projected unit credit method.

When the benefits of the plan are improved, the portion of the increased benefit relating to the past service employees is recognized as an expense in the statement of comprehensive income and expenditure on a straight-line basis over the average period until the benefits become vested.
To the extent that benefits vests immediately, the expense is immediately recognized in the statement of comprehensive income and expenditure.

11 MEDICAL BENEFITS SCHEME Notes to Financial Statements (cont’d) December 31, 2009 4.
Contributions Receivables: Contributions Receivable: Private Sector Less: Provision for doubtful accounts 33 2009 2008 $ 17,870,812 (8,417,667) 15,155,701 (8,146,156) $ 9,453,145 7,009,545 receivables at year end, from This amount relates to both employee and employer contributions receivable at year end, from private sector employers on an accrual basis.

5.

Other Receivables: receivables Staff receivable Other 6.
Short-term Investments: 2009 2008 $ 91,755 224,514 147,055 320,223 $ 316,269 467,278 Short-term investments are comprised of one (1) year fixed deposits and savings accounts, which earn interest at their respective annual rates.
Held to Maturity: Fixed deposits and savings accounts: 2009 2008 ABI Bank Limited British American Insurance Company Limited Bank of Antigua Limited Caribbean Union Bank Antigua Commercial Bank Community First Corporative Credit Union Limited St. John’s Co-operative Credit Union Limited $ 19,665,329 16,855,440 13,269,922 11,480,028 7,436,796 6,360,986 2,480,219 24,060,740 16,855,440 16,248,799 19,509,866 716,551 6,000,000 - Total short-term investments 77,548,720 89,791,396 Provision for impairment – British American Insurance Company Ltd. (10,113,264) (8,427,720) $ 67,435,456 81,363,676 12 34 MEDICAL BENEFITS SCHEME Notes to Financial Statements (cont’d) December 31, 2009 7.
Inventories: Drugs Stationery Goods-in-transit 8.

Quasi-government Receivable: Receivables: Contributions 2009 2008 $ 9,054,861 282,105 - 4,148,979 144,505 33,553 $ 9,336,966 4,327,037 2009 2008 $ 7,699,087 7,406,307 This amount represents contributions due from Antigua Public Utilities Authority (APUA) from inception of the Scheme to date.

9.
9.

Due from Government of Antigua and Barbuda: 2009 2008 receivables Contributions receivable $251,722,353 233,242,353 This represents employee and employer contributions to the Scheme due from government This represents employee and employer contributions to the Scheme due from government departments.

The government contributions receivables are extracted from R3A forms submitted departments.
The government contributions receivable are extracted from R3A forms submitted to the Scheme by the various Government institutions and have been classified as a non-current to the Scheme by the various Government institutions and have been classified as a non-current asset because government departments have not paid their contributions over the years.

asset because government departments have not paid their contributions over the years.
13 MEDICAL BENEFITS SCHEME Notes to Financial Statements (cont’d) December 31, 2009 10.
Intangible Assets: Cost: At January 01, 2009 Additions Disposals At December 31, 2009 Amortisation: At January 01, 2009 Charge for the year Written back on disposals At December 31, 2009 Carrying Value: At December 31, 2009 At January 01, 2009 35 Computer Software $ 1,757,096 257,124 - $ 2,014,220 $ 630,660 619,901 - $ 1,250,561 $ 763,659 $ 1,126,436 14 36 - 1 4 9 , 3 2 6 1 5 , 3 7 5 , 1 2 - 7 5 4 , 7 9 5 , 1 2 9 7 4 , 0 4 1 , 4 1 - - - 0 0 0 , 2 7 0 8 6 , 8 0 3 0 8 6 , 8 0 3 9 3 0 , 1 0 3 3 1 3 , 9 2 4 , 3 - - - - - - 9 3 0 , 1 0 3 - - 0 9 5 , 1 3 3 1 3 , 9 2 4 , 3 9 8 8 , 8 0 1 2 1 7 , 7 5 2 , 2 - - 8 8 9 , 7 6 4 , 2 1 0 0 9 , 4 0 4 , 0 1 5 2 7 , 2 3 8 , 2 0 0 1 , 3 2 5 , 3 , e c i f f O t n e m p i u q E d n a e r u t i n r u F - 1 4 9 , 3 2 1 7 7 , 3 3 2 , 2 s g n i d l i u B d n a L - - - - 8 8 9 , 7 6 4 , 2 1 5 2 7 , 2 3 8 , 2 $ ) d ’ t n o c ( , 1 3 r e b m e c e D : t n e m p i u q E d n a y t r e p o r P .
1 1 8 0 0 2 , 1 0 y r a u n a J t A s r e f s n a r t / s l a s o p s i D s n o i t i d d A : t s o C 8 0 0 2 , 1 3 r e b m e c e D t A s r e f s n a r t / s l a s o p s i D s n o i t i d d A 6 3 9 , 7 3 7 , 5 3 0 8 6 , 0 8 3 9 3 0 , 1 0 3 3 0 9 , 0 6 4 , 3 1 0 6 , 6 6 3 , 2 8 8 8 , 2 7 8 , 2 2 5 2 8 , 5 5 3 , 6 $ 9 0 0 2 , 1 3 r e b m e c e D t A - 4 0 1 , 3 1 7 1 3 0 , 3 7 7 , 7 - 9 6 5 , 7 5 5 5 3 1 , 6 8 4 , 8 - 3 7 1 , 7 3 4 6 , 5 6 2 - 3 7 2 , 2 1 6 1 8 , 2 7 2 - 2 4 8 , 7 3 2 9 0 , 6 2 1 - 2 4 8 , 7 3 4 3 9 , 3 6 1 - - 4 4 5 , 3 1 3 6 7 4 , 4 9 9 , 2 5 8 1 , 5 0 1 1 8 8 , 2 7 0 , 2 - - 3 5 6 , 9 6 0 2 0 , 8 0 3 , 3 8 3 0 , 1 4 6 6 0 , 8 7 1 , 2 - 0 6 3 , 9 4 2 9 3 9 , 3 1 3 , 2 - 3 6 7 , 6 9 3 9 9 2 , 3 6 5 , 2 4 0 7 , 3 4 0 , 9 9 8 0 , 5 8 2 6 7 7 , 1 0 2 3 7 6 , 7 7 3 , 3 4 0 1 , 9 1 2 , 2 2 6 0 , 0 6 9 , 2 - - - - - - - $ $ 2 3 2 , 4 9 6 , 6 2 1 9 5 , 5 9 3 6 2 , 9 9 0 3 2 , 3 8 7 9 4 , 7 4 1 6 2 8 , 2 1 9 , 9 1 5 2 8 , 5 5 3 , 6 $ 8 0 0 2 , 1 0 y r a u n a J t A r a e y e h t r o f e g r a h C : n o i t a i c e r p e D k c a b n e t t i r W 8 0 0 2 , , 1 3 r e b m e c e D t A 9 0 0 2 , 1 3 r e b m e c e D t A : e u l a V g n i y r r a C 2 2 3 , 1 1 1 , 3 1 4 6 8 , 5 3 5 0 1 , 7 3 1 3 9 2 , 1 2 1 6 4 6 , 9 7 9 8 6 , 4 0 9 , 9 5 2 7 , 2 3 8 , 2 $ 8 0 0 2 , 1 3 r e b m e c e D t A 5 1 37 MEDICAL BENEFITS SCHEME Notes to Financial Statements (cont’d) December 31, 2009 12.
Deferred Interest: Deferred interest on staff loans $ 18,208 29,018 Deferred interest represents the interest on staff loans which have not been recognised.

The amount will be amortized over the period of the loan.

2009 2009 13.

Surcharge: The Scheme applies a ten (10%) percent surcharge on the contributions that have not been remitted within the fourteen (14) days grace period granted for remittance of monthly contributions.

14.
Administrative Expenses: Notes 2009 2008 17 18 Payroll and related costs Pension expense Stationery and office supplies Repairs and maintenance Utilities Preventative health programs Professional fees Traveling and transportation Insurance Directors’ fees Meals and other allowances Security Uniforms Rent Staff training Write offs Anniversary celebrations Sponsorships, gifts and donations Advertising and promotion Bank charges Freight charges Miscellaneous Administrative expenses as a percentage of contribution income 16 $ 7,072,140 2,057,770 812,369 774,810 606,418 618,620 527,259 383,978 379,623 376,520 286,168 302,245 169,237 144,160 133,589 111,321 69,371 - 43,580 30,498 19,207 113,722 7,138,637 1,822,072 1,459,393 516,149 585,539 590,789 437,560 390,253 344,492 279,636 231,694 180,475 161,765 110,160 165,056 - - 114,993 91,643 25,021 14,444 104,676 $ 15,032,605 14,764,447 19% 18% 38 MEDICAL BENEFITS SCHEME Notes to Financial Statements (cont’d) December 31, 2009 15.
Donations to the Ministry of Health: Donations to the Ministry of Health represent the expenses paid by the Scheme on behalf of the Government of Antigua and Barbuda in respect of various expenditure categories pertaining to the provision of health services and procurement.

16.
16.

Mount St. John’s Hospital Loan: On August 14, 1998, the Medical Benefits Scheme together with the Government of Antigua and Barbuda and Mount St. John’s Medical Centre Limited entered into a loan agreement with the Bank of Antigua Limited to borrow US$31,000,000 for the construction of the new Mount St. John’s Medical Centre.

The loan bears interest at the rate of nine and eight tenths (9.8%) percent per annum and is repayable over a period of thirty (30) years from August 1, 2000.
Presently the Board is required to maintain a minimum fixed deposit of EC$4,000,000 (included in cash in hand and at bank) and make monthly installments of EC$735,000 to service the loan interest during the period of construction.

The loan repayments made by the Scheme have been treated in the financial statements as a donation to the Ministry of Health.

17.
17.

Personnel Expenses: Salaries and wages Medical Benefits contributions Social Security contributions Others 2009 2008 $ 6,398,954 216,466 264,656 192,064 6,508,659 222,349 248,916 158,713 $ 7,072,140 7,138,637 Average number of employees 124 117 17 39 MEDICAL BENEFITS SCHEME Notes to Financial Statements (cont’d) December 31, 2009 18.

Pension Scheme: The Scheme sponsors a defined benefit complementary pension scheme, in accordance with the provisions applicable to the public officers.
The Scheme is unfunded, non-contributory and operates on a pay-as-you-go basis.
The amounts recognized in the statement of comprehensive income and expenditure are as follows: Current service cost Interest costs Amortisation of past service cost Pension expense 2009 2008 $ 448,747 447,048 1,161,975 448,747 447,048 926,277 $ 2,057,770 1,822,072 Movements in the liability for defined benefit obligations recognized in the statement of financial position are as follows: Balance at the start of the year Expense recognized in the statement of comprehensive income and expenditure Pensions paid during the year 2009 2008 $ 10,488,939 8,909,806 2,057,770 (120,857) 1,822,072 (242,939) Balance at the end of the year $ 12,425,852 10,488,939 Principal actuarial assumptions at the statement of financial position date are as follows: Annual rates Discount rate Future salary increases 2009 2008 7% 5% 7% 5% 19.
Taxation: The Medical Benefits Scheme was established by the Medical Benefits Act 1978 and is exempted from income tax.

18 40 MEDICAL BENEFITS SCHEME Notes to Financial Statements (cont’d) December 31, 2009 20.

Financial Instruments: A financial instrument is any contract that gives rise to both a financial asset in one entity and a financial liability or equity of another entity.
Financial assets of the Scheme consist of cash in hand and at bank, contributions receivable, other receivable, interest receivable, short-term investments, quasi-government receivable and due from the government of Antigua and Barbuda.

Financial liability includes, accounts payable and accruals.

(a) Financial Risk Factors: The Scheme’s activities expose it to a variety of financial risks, including the effects of changes in debt market prices, and interest rates.
Management seeks to minimize the potential adverse effects on the financial performance of the Scheme by applying procedures to identify, evaluate and manage these risks, based on guidelines set by the Board of Directors.
(i) (ii) (iii) (iv) Price Risk: Price risk is the risk that the value of a financial instrument will fluctuate as a result of changes in market prices, whether those changes are caused by factors specific to the individual instrument or its issuer, or factors affecting all instruments traded in the market.

The Scheme has no significant exposure to such risk.

Interest Rate Risk: Interest rate risk is the risk that the value of a financial instrument will fluctuate due to changes in market interest rates.
Interest rate risk is affected where there is a mismatch between interest earning assets and interest bearing liabilities, which are subject to interest rate adjustments within a specified period.

The Scheme’s exposure to interest rate risk is disclosed in notes 6 and 12.

Currency Risk: Currency risk is the risk that the value of a financial instrument will fluctuate because of changes in foreign exchange rates.
The main currencies giving rise to this risk are the Eastern Caribbean Dollar and United States Dollar arising from purchasing transactions.

The Scheme does not face any such risk since it transacts its operations in Eastern Caribbean Dollars, which is its functional currency.

The United States Dollar, in which the Scheme also transacts business, is fixed in relation to the Eastern Caribbean Dollar.
Credit Risk: Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss.

The Scheme’s exposure to credit risk is dependent on the degree of failure of counter parties, including its agents, and others, to honour their obligations that could result in losses.

19 41 MEDICAL BENEFITS SCHEME Notes to Financial Statements (cont’d) December 31, 2009 20.
(a) Financial Instruments: (cont’d) Financial Risk Factors: (cont’d) (iv) Credit Risk: (cont’d) The carrying amount of financial assets represents the maximum credit exposure.
The maximum exposure to credit risk at the reporting date was: 2009 2008 Cash in hand and at bank Contributions receivable Other receivables Interest receivable Short-term investments Quasi-government receivable Due from the Government of Antigua and Barbuda $ 11,632,534 9,453,145 316,269 2,016,555 67,435,456 7,699,087 251,722,353 6,216,902 7,009,545 467,278 2,632,175 81,363,676 7,406,307 233,242,353 $ 350,275,399 338,338,236 Credit risk in respect of contributions receivable, other receivables, interest receivable, short-term investments, Quasi-government receivable and due from the Government of Antigua and Barbuda is limited as these balances are shown net of a provision for doubtful debts.
Cash in hand and at bank are held with financial institutions, which represent minimum risk of default.

(v) Liquidity Risk: Liquidity risk is the risk that the Scheme will encounter difficulty in raising funds to meet commitments associated with financial instruments.

Liquidity risk may result from an inability to sell a financial asset quickly at close to its fair value.
(b) Fair Value The fair value of cash in hand and at bank, interest receivables, short-term investments and accounts payable and accruals is not materially different from their carrying amount due to their short-term period to maturity.

It is not practical to determine the fair value of contributions receivable, other receivables, Quasi-government receivable and due from Government of Antigua and Barbuda, because all information for this determination is not available.
Fair value estimates are made at a specific point in time, based on market conditions and information about the financial instrument.

These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision.

Changes in assumptions could significantly affect the estimates.

20 42 MEDICAL BENEFITS SCHEME Notes to Financial Statements (cont’d) December 31, 2009 21.
Contingencies: CL Financial Limited (“CL”), the ultimate parent company of CLICO International Life Insurance Limited (“Clico Life”), Caribbean Money Market Brokers (CMMB), and British American Life Insurance Company, was forced to cede control of large portions of its insurance, investment banking and brokerage operations to the Government of Trinidad and Tobago.
The Government and Central Bank of Trinidad and Tobago, where CL is incorporated, and the Government of Barbados, where Clico Life is incorporated, have undertaken by way of public pronouncements, to protect the interest of all Clico’s insurance and pension fund clients.

However, the Superintendent of Insurance in Antigua intervened in the operations of CLICO International Life Insurance Limited (“Clico Life”) because of the company’s inability to fully discharge its liabilities as they became due.
British American Insurance Company Limited in Antigua has been placed under Judicial Management in July 2009 by way of a Court Order.

The future operations of the company are currently being assessed and as such, the value of the company’s investment cannot be ascertained at this point in time.

The outcome of the undertakings cannot be guaranteed.

An impairment provision has been made in respect of the investment in British American Insurance Company Limited.
As at the balance sheet date, the Scheme had the following investments in a subsidiary of CL Financial Limited: Company Investment Accrued Interest British American Insurance Company $ 16,855,440 419,159 21 Medical Benefits Scheme CORPORATE INFORMATION Pharmacy Service Locations Administrative Office Nevis Street P.O.
Box St. John’s Antigua T (268) 481-6200 E mbs@candw.ag W www.mbs.gov.ag Main Pharmacy Nevis Street Satellite Pharmacies Locations All Saints Health Centre Browne’s Avenue Health Centre Clare Hall Health Centre Gray’s Farm Health Centre Johnson’s Point Health Centre 44