The Cayman Islands Health Services Authority expects to have nearly $70 million in unpaid bills from services it rendered to patients by the end of the upcoming budget year in June 2015, according to government financial records.
The amount is referred in the government’s 2014/15 budget ownership agreements as a “provision for doubtful debt,” meaning debts that have been owed for more than a year. If the projection of the additional unpaid bills occurs as finance managers expect, the Health Services Authority will have gone from having an estimated $45.8 million in these unpaid receivables to $69.9 million in just two years.
The total allowance for unpaid receivables has been compiled over a period of more than 10 years and some of the bills owed are more than decade old.
Public health officials told lawmakers Thursday during Legislative Assembly’s Finance Committee proceedings that the hospital system, like most public health facilities around the world, could not hope to recover every dollar it spends on operating costs, although they do make significant effort to recover monies where possible.
“There are ongoing efforts by the [Health Services Authority] to collect each year,” Health Minister Osbourne Bodden said. Over the past two years, none of the unpaid bills have been “written off” and Opposition Leader McKeeva Bush said that would probably have to be done, given the age of some of the unpaid amounts.
“I do believe we need to look at [this issue],” Mr. Bush said. “Various persons just cannot pay for healthcare.”
George Town MLA Roy McTaggart, an accountant, agreed with Mr. Bush. “We’re carrying years and years of bad receivables,” he said.
Cayman Islands Finance Minister Marco Archer said that his ministry is looking into the overall problem of unpaid, past due debts for government services and would soon be reporting that information to Cabinet.
The government’s financial statements for the 2014/15 year indicate that all statutory authorities and government-owned companies are owed a balance of $15.9 million in “trade receivables” – payments for services – that are more than a year old.
With regard to the Legislative Assembly debate on the Health Services Authority’s unpaid debts, Mr. Archer said the payments would have to be considered on a case-by-case basis.
“While there is a legitimate case of some people being unable to pay, there are some people who believe they do not have to pay,” he said.
North Side MLA Ezzard Miller said government discussed as part of its 2014/15 budget plan some $19 million to cover local healthcare costs for those without health insurance and another $11 million for tertiary local and overseas healthcare costs for indigents, seamen and veterans. However, Mr. Bodden said those were costs agreed to be paid by government in the upcoming budget.
The unpaid bills provided for in the Health Services Authority budget for the current fiscal year were $15.3 million. In the upcoming year, those are expected to total up to $14 million more.
“We’re talking about $30 million,” Mr. Miller said. “How can we have $14 million in bad debts for the year?”
Minister Bodden, who did not necessarily agree with the use of the term “bad debt” in relation to the receivables, said the government would seek to defray some of the overseas healthcare expenses by using the Health City Cayman Islands facility now in operation in the Frank Sound area.
“If it makes [financial] sense, the better option will be used,” Mr. Bodden said. “I can only imagine in the end that local care is cheaper.”