NHI Secretariat may be acting illegally as an Insurance Company
The Bahamas Insurance Association (BIA) concurs with the Health Minister, Hon. Dr. Duane Sands’ position that in the absence of a National Health Insurance (NHI) Authority Board, actions taken to implement NHI including enrolment and the execution of contracts with medical service providers were unlawful. We also agree with his view that the NHI scheme as it is currently being operated is susceptible to significant fraud; principally because it is operating outside its intended legal framework.
We are concerned however that the identified breaches of the NHI Act and Insurance Act are ongoing and have not been addressed to date. One such breach of the NHI Act is that the NHI Secretariat may be acting illegally as an insurance company.
The NHI Act anticipated that Regulated Health Administrators (RHAs) would be responsible for the management and administration of NHI benefits. The eligibility and functions of RHAs are addressed in sections 25 and 26 of the NHI Act. We note that an RHA is required under Section 25(2) of the NHI Act to among other things,
- be a company carrying on long-term insurance business and registered with the Insurance Commission to carry on long-term insurance business for sickness or health insurance in accordance with the Insurance Act (Ch. 347)
- be certified by the Insurance Commission as an Administrator in accordance with the provisions of the Insurance Act (Ch. 347)
- enter into an agreement with the Authority in accordance with the provisions of the NHI Act; and
- satisfy such other requirements as may be determined by the NHI Authority in order to be registered by the NHI Authority for participation in the Plan.
It is our understanding that no RHA has been contracted to administer the NHI benefits. Instead, the NHI Secretariat presumably under the guise of purporting to act as the NHI Authority has taken on the functions of an RHA as defined in Section 26 of the NHI Act. It is noteworthy to state that the functions of the NHI Authority are clearly stated in Section 6 of the NHI Act and do not overlap with those of an RHA.
The BIA contends that the NHI Secretariat acting on the premise that it can function as the NHI Authority (which has not been formally constituted), may have illegally taken on among other things the following functions of an RHA as defined in Section 26 of the NHI Act:
- providing beneficiaries with access to benefits
- paying providers for benefits
- processing beneficiary claims
- case management
- monitoring the provision of health care benefits
This would violate the NHI Act and as the Secretariat would be carrying on insurance business, is also a violation of the Insurance Act.
The recently reported complaints regarding non-payment of medical providers seems to illustrate one of the practical consequences of violating the law. Had an insurance company failed to make payment, a complaint could have been filed with the Insurance Commission who has the legal power to investigate the complaint and to direct the company to resolve it. The insurer in question could also have been sued for breach of contract. Under these circumstances where the payments themselves violate law, the affected medical providers may not have any legal redress available to them.
We submit that it is highly improper for the NHI scheme to be violating the very law that brought it into being. We recommend that the Government take steps to rectify this apparent disregard for the provisions of the NHI Act and Insurance Act. Additionally, the NHI Authority Board when formally constituted, must take immediate steps to rectify the aforementioned breaches and ensure that the Authority complies with the NHI Act and other applicable legislation.
The Government should ensure that a dangerous precedent is not set vis-à-vis disregard for applicable law. The Bahamas has to act in accordance with the rule of law and public officials cannot knowingly violate duly passed law.
The BIA reiterates its agreement with the concept of Universal Health Care and is committed to working with the Minister of Health and the NHI Authority (when formally constituted) to ensure that a sustainable NHI plan is implemented and administered successfully for The Bahamas. We wholeheartedly agree with the Minister that this is the time to stop, review and get it right.