Public Accounts Committee questioning on 16 Jan. highlighted significant financial management flaws at the Health Services Authority. Yet as the committee probed the authority’s poor performance in the 2024 General Report of the Auditor General, wider issues, such as unapproved price increases and an outdated national health strategy, also emerged.
When Auditor General Patrick Smith released his report into the finances of the Cayman Islands Government in October 2025, it showed that in 2024, the authority “recorded the largest operating deficit of almost $12.4 million, despite having received $25.6 million in government funding and earned $179 million from other sources, and this is concerning”.
Weak internal financial controls
The committee, chaired by shadow Minister for Finance Roy McTaggart, questioned key authority executives in a bid to better understand the authority’s financial failures. One clear theme to emerge was that the authority has a weak grip on its finances – it doesn’t know how much services cost and struggles to file timely accounts.
In October, the report from the Office of the Auditor General revealed, “The HSA made a total of 40 adjustments after the audit began, amounting to $63 million. These adjustments worsened the HSA’s financial performance, increasing its operating deficit by around $7 million and reducing its net worth by the same amount, weakening its financial position.”
Under questioning from Roy Tatum MP, the HSA chief financial officer Sheila Thomas explained that a failed migration to a new accounting software forced the authority’s accountants to resort to “pen and paper” to complete the audit. “In our pharmacy, for example, we have over 40,000 items, and the unit of measurement in some instances were off. The prices were wrong. It was all an Excel nightmare.”
Another fundamental challenge that emerged from the committee is that the authority doesn’t know how much it costs to provide certain services. “We recognise in some areas, what we have to do is to go through a detailed costing to ensure that if we’re charging $120 for you to see the doctor, that it really does cost us $120,” said Lizzette Yearwood, the authority’s CEO. “We’re not here to make a profit, but we need to at least break even.” Yearwood revealed the authority is currently recruiting for a cost accountant to put a more accurate value on its services.
The committee also briefly touched on the embattled board of HSA, which has courted controversy for meeting costs and also seen recent resignations. It’s clear that the authority’s new board will need to address weak internal controls if the organisation is to improve its financial performance.
Wider issues beyond the HSA
But while the committee’s questions revealed serious weaknesses within the authority, it also showed how it needs more support from government.
For example, some HSA fees are set by the government. In 2024, the authority sent a request to the government to increase those fees, some of which hadn’t been raised since 2014. “As you all know, cost of living has increased, the salaries to staff have increased, but our fees have remained static for some services,” said Yearwood.
Those fee increases still haven’t been approved, but Yearwood noted that wider considerations are also at play. “I recognise that Cabinet has a role to play in determining whether or not those fees can be increased, because whenever we increase our fees at the HSA, it impacts the cost of living.”
Yearwood noted that whenever the authority increases its fees, the insurance companies are quick to follow suit and put up coverage costs.
Another significant problem the committee highlighted was that Cayman’s last government strategic health policy was written in 2012 and expired in 2017. Since then, there has been no written comprehensive policy for the jurisdiction’s health strategy.
“The broader public issue of health care needs a national policy,” said committee member, Chris Saunders MP. In November 2025, Health Minister Katherine Ebanks-Wilks announced details of a new National Health Policy and Strategic Plan for the Cayman Islands.
One example of an issue that impacts the HSA, but is outside its remit, is the proliferation of private medical services on the island. Saunders, who estimated there are 180 registered medical practitioners on the island, said, “When you have this [many] providers in a market that is this small and they all need to make some kind of money, this is where people start referring procedures or looking at stuff that people don’t need to do.”
Yearwood agreed it could be an issue. “There has been a cry from the clinicians to say we as a country need to look at how many practitioners that we have here,” said Yearwood.
The most financially significant challenge was the HSA’s unfunded pension and healthcare liabilities. But as Saunders acknowledged, “this is a problem across the entire public sector”.
The robust questioning of the committee helped to highlight challenges both in HSA and beyond. These challenges predate the current administration, but the auditor general’s next annual report will show if it has been able to improve any of the issues.
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