Although the Cayman Islands public hospital system has made some improvements recently in collecting patient payments, it is likely to be saddled with a significant amount of additional unpaid debt at the end of the government’s budget year in June.
Health Services Authority chief executive officer Lizzette Yearwood told the government Public Accounts Committee last week that the public hospital system was being “more consistent in enforcing our payment policy,” particularly with elective surgeries.
However, she noted that public hospitals still have a mandate to deliver care to those who can’t, or won’t, pay for it. “There’s still a culture in the public that a number of persons feel that healthcare is free,” Ms. Yearwood said.
The HSA expected to have nearly $70 million in unpaid bills from services to patients by the end of the government’s current budget year in June 2015, according to government financial records.
The amount is referred to 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 HSA’s unpaid receivables will increase from an estimated $45.8 million 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 a decade old.
Looking at bad debts accumulated over the past three-and-a-half years, former Health Minister Osbourne Bodden noted last year that some $10 million owed consisted of individual bills of less than $1,000 each.
“If these patients would even pay these small bills, it would make a substantial contribution [toward resolving the debt],” he said. “It is not good enough to think government will take care of this.”
In addition, Ms. Yearwood said Wednesday that the HSA is seeking vendors to computerize hospital records, which should help ensure bill collections were better tracked and kept up to date.
According to a government audit released earlier this year, daily reports to reconcile the Cayman Islands public hospital system’s cash collections cost too much and wasted office space in the hospital as the data was printed out and piled up in administrative offices.
The audit of the Cayman Islands Health Services Authority revealed that three reams of 8×11 paper were used each day to print cash reconciliation reports that quickly clogged up storage space and made it painstakingly difficult to find any information via a manual search.
“The retrieval of documents was … noted to be tedious,” an Internal Audit Unit review of the health authority’s operations stated. “The same information could be readily accessed [from the HSA computer filing system] when required.”
Auditors also noted that a number of HSA staff spent hours printing out billing statements and stuffing them into envelopes to be mailed.
“We were informed that staff tasked with collection and credit control spent a significant portion of their time placing statements into envelopes … time that could have been better spent on credit control and collection,” the report stated.
“We are concerned that the current operations of the HSA, which require a high consumption of paper, limit the HSA’s efforts to reduce costs.”
In response to a number of other concerns identified in the June 2014 review, health authority officials reported low staffing levels as being at least partly responsible for difficulty in collecting past-due accounts from healthcare clients who were not 100 percent covered by the Cayman Islands National Insurance Company.