The Tribune

By RASHAD ROLLE

Tribune Staff Reporter

rrolle@tribunemedia.net

THE Christie administration’s move to select a private company to manage its public health insurance option for National Health Insurance has been met with tepid responses from stakeholders who are eager for additional details before they decide whether this satisfies their needs and addresses their questions.

The public option has been a source of contention as the government moves to implement NHI.

The option would make healthcare services affordable to everyone by lowering the cost of such services.

KPMG, one of the government’s consultants on NHI, said during a press conference last week that it convinced the government to choose a private company to manage the public health insurance option rather than have it managed by the government.

Mark Britnell, head of the KPMG team of analysts currently advising the government, also said a public insurer must be established before primary healthcare services could be provided.

He suggested that it could take months before this happens.

Nonetheless, Bahamas Insurance Association (BIA) Chairman Emmanuel Komolafe suggested to The Tribune yesterday that the concerns of the insurance industry will not be alleviated if a private company merely manages the government’s public health insurer while not having any ownership stake in it.

Insurers fear that the public insurer – even when managed by a private company – will incur significant losses at the expense of taxpayers while creating unfair competition in the insurance market.

“Management is not as important; ownership is,” Mr Komolafe said. “With just management, it could still end up operating at a loss.”

The official position of the BIA is that a public insurer is not necessary to make healthcare accessible and affordable.

Given the high development of the private healthcare industry, concerns about access can be addressed through appropriate legislation, regulations and rules, including penalties for breaches, the BIA insists.

However, if a public insurer is to be introduced, the BIA wants it to exist as part of a joint ownership between the government and the private health insurance sector.

“The BIA believes that in order to ensure fairness and transparency in the management of a public insurer by the private sector, it would seem fair that all existing private health insurers (that have invested heavily in infrastructure and systems over the years) should be provided with the opportunity to participate via ownership or part ownership of the proposed national insurer,” Mr Komolafe said. “This will be in line with the much touted PPP approach that has been promoted by the government. A possibility in this regard could be the allocation of share ownership in the proposed entity to the seven private health insurers based on their current market share or other agreed basis.”

Although BIA members have had preliminary discussions about such a venture, they are constrained by the lack of details so far provided by the government over its public insurance plans and won’t proceed further with their plans until the government makes a request for tender.

Indeed, it is unclear if the government is willing to share ownership of the public health insurance entity.

Asked about plans yesterday, the permanent secretary of the NHI secretariat, Peter Deveaux-Isaacs, said details have not been finalised.

“The government hasn’t determined how the arrangement will occur,” he said, adding that it “could very well be a joint partnership (in the end).”

“The government has not yet gone out to tender with the matter,” he said.

Decisions about the ownership and management structure of the public insurance option could have important implications for an industry that employs more than 100 people, is worth more than $270m, and represents over three per cent of the GDP and features Bahamians in many prominent roles.

Gowon Bowe, a partner in PricewaterhouseCoopers (PwC), said yesterday: “The government must not damage an industry that has gone from featuring principally foreign ownership to principally Bahamian ownership. There hasn’t been sufficient debate around a joint venture. It will be a change for all parties but it needs to be seriously considered.”