Premier: Indigent, seamen’s healthcare costs $2.5M-$3.5M per month

Government faces huge cost overruns

The Cayman Islands government is now paying between $2.5 million to $3.5 million each month to fund retired seamen, servicemen and uninsured Caymanians’ healthcare costs.

Premier Alden McLaughlin revealed the amounts Wednesday during statements to the Legislative Assembly that detailed the additional cash his Ministry of Health had to pay in each of the last three budget years, including a $3.9 million payment made in November.

Mr. McLaughlin said government was spending about $1 million to $2 million per month for health services provided to those groups at the Health Services Authority and an additional $1.5 million per month for “tertiary” [specialist or prolonged healthcare] services at overseas or local hospitals.

“[The November payment of $3.9 million] was … necessary to preserve the relationship and reputation of the Cayman Islands government among the network of local and overseas healthcare providers whilst ensuring that the group of persons served … have access to the appropriate medical institutions and services,” Mr. McLaughlin said.

There are an estimated 1,075 seamen and veterans receiving healthcare coverage in Cayman now and government estimates between 1,300-1,400 “indigents” – Caymanians who have no healthcare coverage. The seamen and veterans are covered under a health plan, but any specialist overseas care they receive is paid directly from government coffers.

The healthcare payments present a significant liability for the government in two ways, according to the premier.

First, if a patient’s referral to an overseas hospital is not acted upon simply for financial reasons, Mr. McLaughlin said there is a “high probability” the patient of their family could sue government. Second, if overseas healthcare costs rise higher than expected, those medical institutions expect to receive payment for services. If they are not paid, legal action can be taken against the Cayman government.

The Cayman Islands National Insurance Company, which serves as the funding mechanism used to cover overseas medical costs for uninsured Caymanians, was sued multiple times in late 2014 and early 2015 by various Florida hospitals over outstanding bills. The total amount owed in those cases was in the millions, according to court records.

On Wednesday, Premier McLaughlin revealed the scale of the costs faced by CINICO and the government in trying to pay off tertiary healthcare bills for indigents, seamen and veterans.

For the 2014/15 government budget year, tertiary healthcare costs were initially set at $11.4 million. An additional $5.4 million was provided in supplementary expenditure, the premier said.

During the 2015/16 year, government’s additional payments exceeded its original budget for tertiary care by nearly $3.7 million.

In the current 2016/17 budget year, the additional $3.9 million was spent in November – mainly to cover additional costs from the previous year, the premier said.

The government increased charges assessed to private sector healthcare consumers during 2013 that are paid into the segregated insurance fund. Those charges, ranging between $10 and $20, depending on the private sector coverage the customer maintains, are used to pay for indigent healthcare.

Mr. McLaughlin said the segregated fund raises about $5 million per year with the increased fees in place.

“This is still significantly below the government’s costs of providing healthcare for the indigent, seamen and veterans,” he said.

“An inability to meet financial obligations to the overseas healthcare providers in a timely manner could affect the relationship with these providers, whereby patients referred [by government] could be denied access to critical care,” the premier continued. “This has the potential to affect not just the indigents, seafarers and veterans, but the entire civil service.”

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  1. While I know that the benefits package for Seaman and service men and women and spousal are well deserved , and should be given to them at all cost .
    But $2.5 million to $3.5 million dollars per month cost , those numbers sounds like thsee benefits are going to more than the intended . I would say that this program needs to be sent to the butcher shop for fat trimming week .

    I know that the Medical cost can be a very expensive part , but I think that Government needs to go back to the negotiations table , and not continue to pay these bills as they come in . Because in the Medical field they make sure to make their money .