HIC targets small businesses

The Health Insurance Commission will look more closely to ensure small businesses owners are complying with the Health Insurance Law after getting a conviction two weeks ago against Marksman Electronics and Security Services Company Ltd.

Superintendent of Health Insurance Mervyn Conolly said the HIC did not have something against small businesses, but most of the cases where employers were not providing mandatory health insurance were companies with leas than 10 employees.

‘We understand small businesses have their own challenges like running their own HR department and keeping their own books, but the [Health Insurance] Law clearly says it applies to all employers,’ he said. ‘We can’t say this applies to some employers and not to others.’

Health Insurance Inspector Wesley Gibson was instrumental in getting the conviction against Marksman Electronics. Although no conviction was recorded against the owner of the company, Robert Michael Gooden, the company was ordered to pay a $1,000 fine. In addition, it was ordered to pay the portion of an employee’s hospital bill that would have been covered under the Standard Health Insurance Contract 1 had it been in place.

Mr. Gibson said one employee had brought about the action against Marksman Electronics after receiving a treatment at the hospital. When the employee brought the bill to Mr. Gooden for payment and he refused, the employee complained to the HIC.

‘All it takes is one person to complain,’ said Mr. Conolly. ‘If there is one employee that is not covered, we will come after you.’

Mr. Gibson said the problem with small businesses is often that they don’t have proper bookkeeping and payment records with regard to insurance on their employees. He pointed out, however, that they are required to keep those records by law.

Unlike the Pensions Law, which does not require domestic helpers to have a pension plan and does not require pension plans for non-Caymanians who have been working in the Cayman Islands for less than nine months, the Health Insurance Law requires all employees to have at least the SHIC 1 policy from the time they commence working. Employers must pay at least one-half of the premiums, while employees are required to pay no more than one-half of the premiums.

The law allows for a 15-day period for underwriting, which Mr. Conolly concedes can sometimes be longer depending on circumstances. In such cases the HIC would take a lenient approach, as long as the process of getting a policy was in the works.

Should a person be turned down for a policy for some reason by one of the approved group providers, Mr. Conolly said the HIC would refer the person to CINICO, which would then offer coverage.

Now that health insurance has been mandatory for more than a decade, Mr. Conolly says he doesn’t hear the excuse from employer that they did not know they had to provide health insurance for their employees.

‘Now they’re more often saying they can’t afford it,’ he said. ‘But that’s not our concern. Being unable to afford it is not something we can take into consideration. We can listen to you say that, but it doesn’t change the fact that the law requires all employers to effect and maintain health insurance with respect to their employees.’

Mr. Conolly said employees often do not find out they do not have health insurance until they go to the doctor or hospital and learn they have no coverage. There are a couple of ways employees can determine if they have insurance.

First, they would be asked to complete an enrolment application form when they start work. Then they would be issued a health insurance card.

‘If you don’t get a card, there’s a good chance you are not enrolled and you’re not covered,’ said Mr. Conolly.

Sometimes after an insurance card is issued, an employer will stop making the premium payments, thus terminating the coverage. The employee will sometimes think he is still covered because he has an insurance card and deductions are being made from his pay, but that is not necessarily the case. Mr. Conolly said if an employee has any suspicions that health insurance has been terminated, he can call the group insurance provider and it would, in most cases, let the employee know if he still has coverage.

In addition, an employee could take the card to a pharmacy, which could look up on the computer very quickly if the policy were still valid.

The Health Insurance Commission only has two inspectors currently, but Mr. Conolly said a third inspector should be in place within six to eight weeks. Right now, the HIC is mostly responding to complaints and following through with prosecutions, but when the third inspector comes on board, it will allow for more random inspections of employers.

The HIC can come into inspect any business’ health insurance records, sometimes without notice if it suspects a particular company is not in compliance with the law.

Although Mr. Conolly concedes the fines are not particularly harsh at the moment, a conviction against a company for a Health Insurance Law violation will likely make the HIC more vigilant toward that company.

Sometime this year, the HIC hopes to be able to use another tool in the getting employers to comply with the Health Insurance Law. A recommendation to amend the law so that fines can be levied directly by the HIC has been unanimously supported and approved by the Health Insurance Board and the Ministry of Health, Mr. Conolly said.

‘It’s just a matter of drafting it up and amending the law,’ he said, adding that he is hopeful the changes will occur this year.

In the meantime, the HIC is working much more closely with other agencies like the Immigration Department and the Department of Employment Relations to help determine if employers are getting health insurance for all of their employees.

The HIC is also trying to make sure employers, especially small business owners, have all the information they need about what is required of them. In addition to advertising efforts in this regard, the HIC is involved in educational programmes with the Cayman Islands Investment Bureau and the Cayman Islands Chamber of Commerce.

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