EDITORIAL – Opting out of public healthcare

It’s official: Not even the government wants to be locked into the government’s healthcare system.

Only 11 of government’s 26 statutory authorities and companies use the Cayman Islands National Insurance Company (CINICO), covering fewer than 250 workers and dependents — compared to 3,000 workers and dependents who have private insurance contracts.

Those opting out of CINICO include, notably, the Health Services Authority itself. Setting aside any apparent irony, CINICO CEO Lonny Tibbetts points out there may be a certain “moral hazard” in the HSA charging CINICO for services it provides to its own employees.

In regard to the other 14 entities, however, it seems their decisions to “self-privatize” boiled down to the simple calculus that private insurance companies enable access to a range of healthcare providers, whereas CINICO funnels policyholders into the public hospitals and clinics.

Finance Minister Marco Archer has responded to the situation by attempting to herd those public sector employees back into CINICO, saying it should make CINICO (and government) healthier financially in the long run, and estimating that government spends 20 percent of its annual budget on healthcare. A 2014 report showed that over the next 20 years, Cayman will face $1.18 billion in public healthcare liabilities under existing arrangements.

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We agree with Minister Archer’s recognition of the severity of the public healthcare problem. Where we disagree, fundamentally, is in his recommended treatment.
The fact that an overwhelming number of public sector employees, when given the choice, don’t choose CINICO is one symptom among many that point to a single underlying condition.

Let’s review a few issues that have been reported by this newspaper:

Section 12: The HSA Law contains a provision that, in the opinion of Justice Richard Williams, grants immunity to HSA staff (including doctors) from clinical negligence lawsuits, unless “bad faith” can be proven. In other words, it’s nearly impossible to sue Cayman’s public hospital for medical malpractice. Now that Justice Williams has brought Section 12 into the spotlight, we are hearing protestations from various corners of government that the section was never intended to grant blanket immunity. We remain skeptical, considering that HSA has settled claims brought by at least eight people since 2005. Every time someone brings a liability suit against HSA, attorneys would examine Section 12 thoroughly. As it stands today, and for the foreseeable future, Section 12 remains in place as a legal reality.

CarePay: In addition to wrongdoing perpetrated by then-HSA board chair Canover Watson when he defrauded taxpayers in the CarePay scandal, Mr. Watson’s trial depicted a climate of almost-unimaginable incompetence throughout HSA and CINICO, up to the very highest levels. The heads of HSA and CINICO admitted they did not even read the multimillion-dollar CarePay contract before signing it. Now, Deputy Governor Franz Manderson has ordered an internal audit of HSA and the health ministry. Meanwhile, police investigations continue.

Bad debts: The HSA has amassed bad debts at an annual clip of $15 million since 2010. Acting Auditor General Garnet Harrison has said HSA will have written off “at least $120 million in receivables in the last nine to 10 years.” Much of the unpaid debt may have stemmed from government’s conscious decision not to pursue collection through the court system, according to Financial Secretary Ken Jefferson.

For reasons of space, we’ll end our list here.

A preponderance of evidence indicates the following: Cayman’s public health system is so damaged and so ill-managed that it cannot be fixed by the people who broke it in the first place. The only hope for a cure is to bring in new people with new skills and new attitudes. The sole avenue for that sort of transformation is, as recommended in the laid-by-the-wayside Ernst and Young report, by outsourcing public medicine (and potentially CINICO) to the private sector.

The healthcare field is the fastest-moving and most-rapidly-evolving industry in the world. What we have “done yesterday” doesn’t work today and most certainly won’t work tomorrow.

Cayman is experiencing an erosion in confidence in our public health system that will be as difficult to restore in terms of public perception, as it is to seek redress in a court of law for grievances against HSA.

As HSA itself and the other authorities have demonstrated, unless people are forced into the public health system,they are increasingly looking elsewhere. Instead of fighting them, the government should facilitate their search for service.

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  1. Who pays the premiums for this private health insurance covering 3,000 employees in government statutory authorities.Do the employees pay themselves or is the bill footed by the private sector taxpayers as with the rest of the Civil Service?.