Health Insurance Regulations (2013 Revision)
By Premier Hon. Alden McLaughlin, MBE, JP, MLA
April 2016

Madam Speaker, I would like to move the proposed amendments to the Health Insurance Regulations. As is outlined in the motion, section 25(2) of the Health Insurance Law (2013 Revision) provides that regulations made under the Law are subject to affirmative resolution by the Legislative Assembly. Madam Speaker, I am therefore tabling the proposed Health Insurance (Amendment) Regulations, 2016, to be affirmed by this honourable House.

The proposed amendments are made up of two clauses, Madam Speaker. Clause 1 on page 3 provides the citation and the commencement. Members will note that the proposed commencement of the amended regulations is after the Health Insurance (Amendment) Law, 2016, comes into force. I have spoken / will be speaking to these amendments to the Health Insurance Law when we deal with bills later today.

Madam Speaker, Clause 2 on page 3 repeals sub-regulation (1) of regulation 5 and substitutes a new sub-regulation. Under the new provision, the Cayman Islands National Insurance Company will pay $10 dollars per month of each premium charged under each standard health insurance contract in respect of an insured person with no dependents, and $20 dollars per month of each premium charged under each standard health insurance contract in respect of an insured person with dependents.

However, Madam Speaker, with these amendments this contribution to the contributions outlined above will not apply to persons in the following categories for whom Government affects a contract of health insurance:
• Each officer in a pensionable office or on probation to such an office;
• Each officer serving under a local or an overseas contract;
• Each officer in a temporary office;
• Each public office pensioner;
• Each indigent person;
• Each elected member of the Legislated Assembly and, where the Speaker is not a member of the LA, the Speaker;
• Each past elected member of the Legislative Assembly who is a public office pensioner;
• The dependents of any persons specified above;
• A seaman 55 years of age or older and his dependents;
• A widow of a seaman;
• A veteran and his dependents;
• A widow of a veteran;
• Any other person approved by Cabinet;
All other approved health insurance providers will continue to pay $10 dollars per month of each premium charged under each standard health insurance contract for individual policy holders with no dependents, and $20 dollars per month of each premium charged under each standard health insurance contract for individual policy holders with dependents. Members of this Honourable House are likely aware that these funds are collected into the Segregated Insurance Fund, and that fund is used by the Government towards the cost of healthcare for indigent persons.

Madam Speaker during the preparation of the 2014/15 budget it was necessary for the Government to reduce operating expenditure in order to meet the operating expenditure targets mandated by the Foreign and Commonwealth Officer. In light of this, the Honourable Minister for Finance and Economic Development decided that CINICO should be exempt from paying the Segregated Insurance Fund fees for Civil Servants, Retired Civil Servants, Seafarers and Veterans retroactive to 1st July, 2014. However, CINICO will continue to pay the Segregated Insurance Fund fees for members, or policy holders, under the Standard Health Insurance Contract plans and for members employed with Statutory Authorities and Government Companies.

This policy decision was made to eliminate the “right pocket to left pocket” transfer of funds back and forth between the Government and CINICO – Government would pay the premiums for civil servants, pensioners, and seafarers and veterans inclusive of the Segregated Insurance Fund contribution over to CINICO, and CINICO would remit the Government’s Segregated Insurance Fund contributions to the Ministry of Health. The effect was to “artificially” inflate Government’s expenditure, even though the funds were re-collected and reflected in revenue. When the funds collected were then spent on indigent health care they were effectively “double counted” in the expenditure.

Removing this contribution for which the individuals that Government pays health insurance premiums will result in a more accurate reflection of expenditure, only counting the funds once – when they are spent on indigent care.

Madam Speaker, as every member sitting here will be aware, with this change, the revenue for the Segregated Insurance Fund will decrease with no guarantee of a corresponding decrease in premiums paid by the Government to CINICO on behalf of its members. However, I want to re-emphasize, Madam Speaker that CINICO will continue to collect and remit the Segregated Insurance Fund contributions for its “non-government” clients, including the elderly, health-impaired, and lower-income insured groups.

Madam Speaker, these amendments are the results of consultation with the Superintendent of Health Insurance, the Ministry of Finance and CINICO. I would also like to thank the Ministry of Health and Culture staff and the staff of the Legislative Drafting Department for their dedication and support.

I look forward to receiving the support of my colleagues in this Honourable House so that the amendments can be brought into effect.