By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Bahamian insurers yesterday said that while they “don’t expect any material increase” in medical coverage costs due to National Health Insurance (NHI) reforms this cannot presently be guaranteed.

Marcus Bosland, the Bahamas Insurance Association’s (BIA) deputy chair for life and health insurance, told Tribune Business the industry is still awaiting the accompanying regulations and any “devil in the detail” before it can determine the precise impact on the pricing and benefits structure of existing private medical policies following the NHI Bill’s tabling in Parliament.

The Bill’s main purpose is to introduce the Standard Health Benefit (SHB), which will act as the “minimum” primary care benefits package available to NHI beneficiaries who currently total some 161,000. Private health insurers, such as Colina, Family Guardian and CG Atlantic, will agree with NHI to become “approved insurers” to provide the SHB to beneficiaries enrolled with the Government’s scheme.

Mr Bosland told this newspaper that the Government has agreed to give health insurers and their existing private clients a one-year transition period, which starts immediately upon the Bill’s passage into law, to adjust premium pricing and benefits accordingly.

He added that the industry believes this will provide sufficient time for what are likely to be “a lot” of changes to the illnesses, treatments and procedures covered by benefits packages in existing private medical insurance policies. Some of these will now be incorporated into the SHB, which is set to include primary care; early detection and preventative care; diagnostic imaging; and paediatric care.

Other SHB benefits involve “maternity care by a general practitioner, or by an obstetrician and/or gynaecologist” and “screening programmes for cancer and other specified conditions”. Mr Bosland yesterday explained that NHI’s pricing structure is markedly different from how private health insurers determine their fees and benefits packages.

While private insurers seek to share the risk with clients through the likes of co-payments and deductibles, NHI mandates that no costs are incurred by patients at “the point of service” when they see a doctor. As a result, underwriters who agree to become “approved insurers” will have to cover 100 percent of the SHB costs rather than the insured part-pay these.

But, while this would normally increase health insurance costs and premiums paid by clients, Mr Bosland told Tribune Business the private sector is optimistic any major hikes will be avoided thanks to the use of NHI’s provider network and the “fairly decent costs” agreed by the Government-funded scheme and the doctors who care for its patients.

Revealing that insurers would “have liked a little more time” to provide feedback on the NHI Bill, he added that consultation was nevertheless adequate because the industry had seen - and commented on - a 2022 version of the legislation that is not dissimilar to the current model.

“It’s been kicked around for a bit and now it’s back,” Mr Bosland acknowledged, noting that the SHB is chiefly focused on primary care and laboratory services. “In broad strokes we largely support the initiative,” he added of the insurance industry’s position. “It does, though, mean a fair degree of change for insurance companies and our health insurance clients.

“It will mean that the products themselves have to amended to comply with the law. The Government has indicated to us there will be a gap of one-year between the Bill being passed into law and when the requirements and underlying package will be enacted. It gives the insurance companies time to adjust their products, their systems and continued education of the public.

“Plus it gives enough time for the Government to do the remainder of the work.... There’s some additional legislative work that has to happen to give effect to the requirements of the Bill. It’s not going to affect anybody immediately.” Mr Bosland said this additional work involved drafting the regulations that typically give laws enforcement teeth.

Revealing that the BIA and its members are largely in favour of the NHI reforms, he added: “I do think the changes make sense for The Bahamas and the one-year gap gives sufficient time to adjust. In broad strokes, the insurance industry and the BIA itself support the legislation. It’s not perfect but we support it. Everything will likely change a lot.”

With the SHB providing the “minimum” care and benefits package for NHI enrollees, private Bahamian health insurers will now restructure their own policies and premium pricing accordingly in reaction to its introduction. 

“Most insurance companies, their products are fairly comprehensive,” Mr Bosland explained. “For most providers, it’s not things that will be added but the structure of benefits will change quite a bit. NHI requires no fee at the point of service. The way private insurance companies largely operate is through co-payments and deductibles, where they and the insureds share the cost.

“Effectively, under NHI, insurance companies will pay 100 percent of the underlying costs. The Government will effectively be mandating us to offer NHI-style pricing as part of our private health insurance products that we sell to our clients. Normally, that would increase costs and require premium costs to go up.

“But because we will be using the NHI network, and they’ve agreed fairly decent costs with the medical providers, we don’t expect there to be any material increase in costs at this point in time. That’s not a guarantee because the devil is in the detail.” That “devil” could potentially be contained in the regulations accompanying the Bill but these have yet to be released.

Asked whether there had been sufficient consultation with the Government, Mr Bosland replied: “It seems like a good initiative. We think it’s a step forward. You can always complain, but we did have sight of this Bill a few months ago. We were able to provide them with very detailed feedback.

“Because this affects insurance companies we wanted time to review it. We did not get as much time as we would have liked, but did have the benefit of seeing the previous iteration of this Bill, which was substantially similar to the current one. The review was fairly easy and, all things being equal, we are comfortable the insurance industry was able to do an adequate review.

“The Government took our comments into consideration, looked at every single one, gave feedback on and responded to everyone, and they did adjust the Bill in respect of some comments made; not all. The process was not ideal; we’d have liked more time, but because we had reviewed and commented on the previous iteration we think the consultation process was adequate.”

Under the new NHI Bill, beneficiaries will be able to “select a standard health benefit provider” from those approved by the NHI Authority. An “approved insurer”, who will offer the SHB package, must demonstrate “financial stability”; its compliance with the Insurance Act; and “ability” to provide the required benefits.

Such an insurer will be charged with providing “the standard health benefits to every insured person enrolled in [NHI] and covered by an agreement with the Authority”. They will also be mandated to inform the NHI regulator if a plan beneficiary’s “private sickness and health insurance is lapsed [and/or] cancelled and encourage them to enroll in the Government-run scheme.