Soaring healthcare costs pose major risk to public purse
(CNS): Whichever group of candidates forms the next government, they will be faced with significant pressure from the public to reduce the cost of living, tackle the immigration conundrum, improve education standards and address the housing and over-development crises. But the biggest headache of all might prove to be the government’s growing healthcare tab for Caymanians. The increasing costs risk future deficits and falling foul of public finance laws.
With so many people now dependent on government to help them with their medical needs, the public purse is spending one quarter of the entire annual core budget on healthcare. In Auditor General Sue Winspear’s final report before she left office, she warned that healthcare spending has become a major risk to the stability and sustainability of public finances.
According to the report, entitled Long-term Financial Sustainability, between 2018 and 2023, public sector expenditure on healthcare increased by 74%, reaching $246 million. This included money provided by the government to the Health Services Authority to deliver health services, tertiary medical care at overseas providers, health insurance for civil servants, seamen and veterans, and health insurance for civil service pensioners.
In addition, the Cayman Islands Government also has a liability of post-retirement healthcare liability of about $2.4 billion for civil servants and another $400 million for public sector workers employed in government companies and statutory authorities. In addition, it is anticipated that by 2033, around 29% of Caymanians will be aged 65 or over, putting even more pressure on future governments to cover the costs of their aging population’s healthcare needs.
Alongside these rising, baked-in costs, the healthcare bill could surge at any time due to unpredictable global pandemics, as was the case in 2020 through 2022, when the government had to find $333 million in additional expenditure and lost revenues.
Between 2018 and 2023, the money the government gives to the HSA for the provision of healthcare increased by 70%, from $34 million in 2018 to $58 million in 2023. Over the same period, hospital admissions increased by 19%, operations by 22%, outpatient clinic visits by 85% and filled prescriptions by 36%. The HSA’s staffing levels also increased by 39%.
The CIG also covers healthcare and insurance for all civil servants and their dependents, civil service pensioners, seamen and veterans. Over the six years that the report covered, health insurance premiums for civil servants paid to the Cayman Islands National Insurance Company increased by 81%.
The government’s bill was even more last year and will be again this as CINICO has increased the cost of premiums. The Plan and Estimates for 2024–2025 shows that budgeted health insurance costs for 2024 are 30% higher than in 2023, and that 2025 costs are expected to be another 8% more as costs spiral year-on-year.
The CIG also spent $55 million last year on tertiary medical care at local and overseas institutions for Caymanians who are under- or uninsured. The Office of the Auditor General pointed out in this latest report that the budgeting for this is significantly underestimated every year. Budgeted and actual expenditure on tertiary medical care between 2018 and 2023 and for the current budget are way out of line.
“Actual expenditure on tertiary medical care was significantly higher than that budgeted for in each of the six years from 2018 to 2023,” Winspear stated in the report. “The budgeted amounts for 2024 and 2025 are $18.7 million and $14.4 million, respectively. This compares with actual expenditure of over $50 million in 2022 and 2023.”
In December 2024, Parliament approved an increase in the 2024 budget of $21.2 million, increasing it from $18.6 million to $39.8 million. It is highly likely that by the end of this year, additional spending will be well over $50 million.
Despite huge government healthcare spending, there are still thousands of people in Cayman who do not have adequate cover or access to heathcare because, despite the mandatory requirement for everyone to have health insurance, many are still uninsured and many are under-insured and cannot afford their co-pay payments or cannot pay medical expenses that are not covered by their inadequate policies.
Meanwhile, healthcare insurance providers, who making a hefty profit each year, have been criticised for failing to provide adequate affordable insurance to the majority of private sector workers who are compelled to have at least a basic private insurance policy, the cost of the monthly premium being shared with their employers.
According to the latest statistics from CIMA, at the end of the third quarter last year, local health insurance companies had already made a profit of well over $55 million, as the government plugs the gap to enable the health insurers to profit.
Over the years, successive governments have bemoaned the situation, often describing it as failing, a result of the decision made more than 25 years ago to adopt the private sector-based system. Several MPs over the years have urged the CIG to reconsider and introduce a single-payer system — which CINICO was originally meant to be.
Many health ministers have posed the idea of free healthcare for all children and pensioners, but so far none has been able to come up with a solution to the inadequate but costly provision currently available or reduce the amount of money government spends annually trying to plug the major holes in the system.
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Category: Health, Health Insurance
12@4:35pm – True…and more are coming. New one opening soon.
The number of hospitals and clinics for this small population is completely disproportionate, but still they come. Big money in healthcare.
If CINICO is paying so much and health insurance premiums are too high, where is this money being spent? It CIMAs numbers are to be believed, health insurers aren’t even making a consistent 5% in profit! The cost of healthCARE is through the roof. Where is it going?
Finally! We watched it start, watched it grow to unsustainable amounts and now everyone is just kicking back and watching it till it breaks Caymanian hold on the island. Understand this, It is a bill owed by all Caymanians only. It now should be apparent that Caymanians do not have the discipline, the will, nor the intelligence to tackle and fix this. Or do they?
Of course they have the discipline, the will, and
the intelligence to tackle and fix this.
It’s very rude for you to suggest otherwise.
…
They’re going to make expats pay for it.
Like everything else.
CNS, why don’t you chat with Ezzard Miller about this subject? I remember that during the previous administration he spoke about why healthcare was so expensive and he offered a few ways to bring down the cost but Government would not take up any of them (surprise, surprise). Why are we still sending people overseas for treatment, when we have oncologists, neurologists, pediatric surgeons, and a few other specialists on island? Why do doctors need to order a blood test? In Central America you get your blood test from a duly-licensed lab and walk into the doctor with your results in hand already. No guess work. No trial and error expenses.
Maybe we can start by civil servants contributing at least CI$200 per month to their CINICO health insurance premiums?
I know many civil servants would be upset about this – but the matter is one of national concern and if civil servants are indeed servants of their country then they would truly be serving it by reducing the weight of this expense and contributing to the public purse for their own personal health insurance expense.
Of course, no MP wants to motion for this because they fear losing the votes. I would gladly lose the next election to save the future of the country’s financial well-being. But since MPs are mostly concerned about their own financial wellbeing, then votes over sensible policy will continue to be the choice.
That wold generate an income of $1,000,000 every month…$12,000,000 a year would go a long way to reducing the burden of healthcare costs to ALL of us.
There are some civil servants that would not mind contributing to a premium IF given a choice of where they can go for services.
Civil Servants are told they can only go to HSA but cannot get an appointment for months.
They also refuse patients referral requests, even when it is clear that they do not have the resources to handle the volume.
Do they truly care about the well-being of the patient or just want to ensure that funds are paid only to HSA?
Caymanian voters need to have a come to Jesus moment amongst themselves. Stop shooting yourselves on the foot. You need to know the numbers before you can make informed decisions that benefit the majority. You cannot continue to sell your land to foreigners for a quick buck and then complain that there is no land; or continue to import cheap labor, and then complain when Caymanians do not want to work for meagre wages. Decide what you want to do as a people, and move in that direction. Stop wishing failure on your fellow Caymanians. Wake up!!
there is no-one in cig or civil service with expertise or qualifications to tackle an issue of the magnitude
civil service is filled with poorly educated people with zero ability to tackle these issues.
if we can’t be honest and face these facts we will never be closer to a solution.
To 9:50am: Oh, yeah? Really? Your comment stinks of disdain and lack of knowledge. I invite you to submit an FOI to PoCs, and find out exactly how many civil servants hold degrees and even PhDs. If you do not respect Caymanians, why are you even here?!
I guess they are basing this on what they see and we all experience during our interactions with Government Services.
Now that the vote buying season is nearly over, perhaps our new government will have the courage to suggest that civil servants and all other freebie riders, could possibly pretty please make SOME contribution towards their expenses.
We’re or not civil servants have the ability to do that begs the questions.
WILL they want to make a contribution..?
WILL politicians enforce it if votes are threatened..?
Wait until; you see what is coming… all the free breakfast food, snacks 90 minutes later and a full lunchtime plate another hour later and these students are indulged with no thought on their girth and future medical issues.
Stand outside CIG offices and watch the rivers of styrofoam packaged food going into the building.
Not on island any longer, but I can tell you where the problems with medical costs are:
1) Too many doctors on island. Caymanian business owners keep importing doctors (in the same specialties) because they keep 60% of their generated income
2) Doctors have to bill ‘creatively’ to make a decent income with fewer patients per doctor, and insurances like CINICO have no competent people to screen the billing properly
3) CINICO cannot deny requests for treatment abroad because the government does not want to lose votes
4) A lot of workers going to A&E at HSA have no active insurance. Their employers only pay for the first month, I know that even a person directly related to a very high up politician ended up in A&E without insurance once. These unpaid bills end up as liabilities for the government
5) Old doctors arrived on island 30-40 years ago are now Caymanians. They control the regulatory bodies and oppose any changes that could reduce their power and income
I could go on, but you get the vibe…
Free CINICO for life for government employee and spouse after ten years service – even for expats.
Non-contributory pension at 12% of inflated income.
5% COLA and Christmas bonus.
….. explain to me why there’s no money?
my brother in Christ… Cinico and pensions account for barely 5% of the money spent. This is like those idiots in the US that think Medicare is bankrupting the government, no, its never that its always corporate hand outs, for us in the form of duty waivers and exemptions to developers, vote buying projects and as noted in the article government stepping in front costs to insure private entities can make profit.
The myth that public services are what costs the most is propaganda meant to keep the middle and lower class focused on a nebulous self hating target so we never actually try to tackle the real problem which is always corporate greed.
Explanation: Government
The vast majority of government workers are voters, in a country with a small percentage of the population entitled to vote. Our politicians have a huge vested interest in keeping the GI Government workers happy.
Eat healthy folks that will cut the medical bill in half right away. Ive never seen so many people killing themselves with junk food, drinks and crazy Cayman good food they call it will kill you
You all didn’t know this?! Oh, that’s right. Y’all don’t have time to watch YouTube when Finance Committee is on. 700 people can tune in to hear the host of CMR curse out people with full expletives, but when the country’s finances are being discussed, it is a miracle if ten people tune in. Now you whine and moan… absentee board members!
Chris Saunders has only been shouting this from the rooftops since day one, but you all are too busy bashing him to pay heed. He brought this up at every Finance Committee for the past eight years. This and the post retirement liability that Cabinet refuses to put in the balance sheet. Go check it out. All of this is public information. Nothing is hidden, if you take the time to look for it. The whole budget is on the internet, line by line.
Didn’t Saunders just get free medical for children under 18 and everyone over 65 years old? Where is that money coming from?
To 8:32am: For your information, we had free medical for children under 18 up to the late 80s, if I remember correctly.
I’m quite aware of that. Government was paying a lot for people going overseas then as well that’s why they started mandatory health insurance.
Free medical for everyone over 65?? Really??? Where do I get the information??
I’m Caymanian & 70 paying KYD 1,000+ monthly for health insurance from my $1200 pension !!
You are uninformed. My 87 year old Caymanian born mother doesn’t and hasn’t ever gotten free medical, nor has her 67 year old son. That alone could make the difference for us, between making it or being forced into NAU for whatever medical care is approved, but alas your statement is light years away from the truth.
You statement is the way it should be, but never has been and isn’t now.
Show me where..???
Socialism isn’t the answer
Capitalism isn’t either.
I agree.
Previous and present leaders have kick this can down the road for years and it’s unfortunate that so many lives have been affected and left by the way side. Some died heart broken and flat out broke! Our government leaders only look out for their pockets whilst the joe public gets crumbs. It is time our people demand better and hold our elected leaders accountable. If they are doing a lousy job, get rid of them and start over.
Each and every civil servant should be made to contribute 150 ci per month from their wage towards their healthcare or 100 ci per person. Kids under 18 free
Elvis, You are correct. in every other western country civil servants make a contribution every month towards their healthcare. The rate depends on how many are covered in a family. This is not rocket science. Do it politicians.
Exactly
Rubbish. Google is the truth detector.
They can easily afford $150 a month…
5000 civil servants x$150 =$750,000 a month =$9,000,000 a year to help reduce premiums on pensioners.
Are civil servants decent enough to do this..? Are politicians brave enough to do the right thing..?
Our problem is we are relying on private medical insurance to cover the flu but not cancer, heart disease or diabetes. They don’t want to pay for it so Government picks up the tab. Why not do what other Caribbean islands do and allow Government to collect premiums from people? It works in Turks and Caicos and Bahamas and they pay for their countrymen who own businesses and do not work for civil service. Ask Health city how many patients they get from other countries for cancer treatments and heart bypasses?
People aren’t entitled to be subsidised. People must live or die within their means. If you can’t afford it, you don’t deserve it. That includes healthcare.
Why do you think that other taxpayers should fund you? (There’s no such thing as government money, only taxpayers’ money)
Re. the other Caribbean states to which you refer – look at the quality of their economies: they are basked cases.
How about the people who worked for decades before you were born, skippy? Think they deserve a little grace at the end of their “golden years”? Think you might wish for the same? You must be a “basked” case if you think those that can’t afford this out-of-control health insurance cost should just curl up and die. Your time come.
Here is what needs to be done, remove politicians from receiving free healthcare (and pensions, but more on that later) so that when it directly affects them they will address the issue.
It’s been reported over and over that Ken Jefferson has conspired with various PPM-affiliated governments to hide over $2 billion in maturing liabilities from the CIG Balance Sheet. Why is he still in any bookkeeping role anywhere?
Because successive Cabinets refuse to allow him to. It really is as simple as that.
Over priced healthcare is inevitable and a surety, our system is based on the US Healthcare model. What’s not to expect. Oh Healthy City was supposed to be different but has also seen its profits soar, now the organisation profiteers just like the rest. Business must be booming otherwise there wouldn’t be another campus as Camana Bay.
As other have stated in this thread the real problem lies with our North American dietary habits, giving up fast food and making healthy meals for yourself is a good start but most people are too addicted to junk/fast food and or lazy to make a start and keep at it.
This sad situation is not likely to change for the better as insurers just like banks have become accustomed to making record profits off of exponentially rising premiums whilst providing diminishing services. CIG neither has the bargaining power nor the will to negotiate a better deal with reinsurers and reduce premiums across the population when it is satisfied its own employees are just getting by and putting them in deeper debt.
A community accupuncture center will help and is typically very affordable.
Don’t worry, it’s a package deal coming with the Chinese cruise pier.
stop lying.Theres no package deal coming with Chinese cruise pier.Stop telling lies.
C’mon David you know it’s either the Chinese or the Russians will make it happen in Cayman. Besides the PPM are the Putin’s Port Mongers in disguise;)
Vote PPM and a CHEC package deal for cruise piers soon come… but benefit to Cayman will not be included.
The usual suspects will be the only winners, and Cayman’s debt will increase by $450,000,000 .
yep…and also doesn’t work.
old school Chinese scam.
Ignorant comment.
Accupuncture is older and more proven than allopathic medicine by a factor of 40 or so.
Health insurance costs are killing us. I could finance a nice house or condo for what my spouse and I have to pay monthly. When what little we have is gone, then we become part of the problem, right. We are forced to spend our savings, our retirement on health insurance. Really great plan. Hope it works for somebody, because the system has failed us.
Who do you expect to pay for it?
We have always paid our way all our lives. What I expect is that our government will not allow vast waste and out of control health insurance to ruin their senior citizens. Does that sound reasonable to you, or do you think that senior citizens should instead be put to death by attrition once they have expended their live savings on health insurance?
Your time will come skippy. Never fear.
People must live of die within their means.
If you can’t afford it, you don’t deserve it.
That includes healthcare.
Why do you think that other taxpayers should fund you? (There’s no such thing as government money, only taxpayers’s money)
Lucky for you, you are rich and don’t have to concern yourself with such lowly problems.
What I know is that you aren’t one of us. Your sociopathic ideals could never be from a native born Caymanian. You want us to watch our elderly wither and die from attrition, because the system didn’t support them. I hope you — and me — get that which we deserve.
I am a taxpayer also, and I would guess have put in far more than you… I mean, otherwise, you wouldn’t have that shitty entitled attitude had you been here long ago and paid your bones.
I don’t expect anyone or CIG to “fund” me, or anyone else. I expect that they don’t waste our funds or allow a good-ol’-boy insurance system which protects government employees, and causes the private sector to pay for it.
A governmental entity that doesn’t provide for their elderly is a disgrace. I don’t want a free ride. I want a fair ride, the ride I’ve paid into for 50+ years.
If this issue isn’t sorted out, are the younger generations of Caymanians in trouble? Shouldn’t they consider leaving before it’s too late? Overall, this is pretty concerning news. I really hope the new government is prepared to dive in and start working right away!
I would leave in a heart beat if I could but I’m fully Caymanian. It’s much easier to move when you have citizenship in another country through your parents, spouse, etc.
Don’t you have automatic access to the UK?
I know it has [major] problems, but it’s exponentially larger than here, with opportunities to match.
Have you seen the cost of real estate there????????
Have you seen the cost of real estate here?!
If you are Caymanian, you have full British citizenship. You don’t even need to get the passport.
Great plan. Take a round trip (because you can’t GET a one-way) to the UK. Walk off the tarmac and stroll down the street, pulling your suitcase on wheels behind you, and go door-to-door looking for a job. No worries sleeping on the park bench until you can afford a room. Better make that trip when it is warm, huh?
So, this is your answer? Because we have the right to travel to the UK, that takes care of everything? That is a bullshit answer, and I think you knew it when you said it.
What is needed is better control over the costs of health care and health insurance. If you don’t feel that, they you are among the elite riche, and shouldn’t even be commenting here.
the crowd says the UK isn’t worth it…read the emigration section in the census. Emigration to North America is 15/1 for Caymanians. But……Alden’s strategy in action..
What do you mean by Alden’s strategy in action? This is a genuine question by the way, I want to know more about this.
cayman diet and inactivity = recipe for disaster…
not much hope when cayman kids are also some of the most inactive in the world…
any comment mrs governor?
Speak for yourself.
Who is down-voting this?
It’s proven. We have many fat adults, and many fat kids. We have a stupendous amount of fast food options, combined with horrifyingly expensive fruit and vegetables. The people here tend to be either couch potatoes or very sporty, with little middle ground.
Fix this conundrum, and you’ll see a happier and healthier community. Good luck though, fast food is like crack cocaine.
They are down-voting it because it implies that being fit is the solution to the outrageous insurance costs and cost of administering health care.
It has been obvious for decades that many of us eat entirely too many simple carbohydrates, refined sugars and don’t engage in enough exercise.
I have only one comment; hate the game and not the player. Make health industry free market that allow global vendors with minimal red tape. This will encourage competition and reasonable pricing the same way as in a fish market.
Oh, you mean how banking and telecom are free markets? There are licensees that collude on fees, not just their own, but what they suggest doctor billingables should be, like those are negotiables.
Telecoms here isn’t a free market. Why do you think that OfReg have blocked Starlink from operating here? Because, like everything in Cayman, telecoms are taxed to fund the NAU, the Alternative NAU (AKS World Clown Civil Circus), and pay politicians’ vastly inflated salaries.
free healathcare tip:
eat less, do more = live longer/healthier.
And dont live near the dump.
Or any roadway, or near power lines, or drink and wash with heavily chlorinated water, or eat any food encased in plastic, or allow your blood pressure to be elevated by officious know-it-alls like 12:45 that think they have the right to judge anyone.
free money making solutions:
treble duty on cigarettes/vapes
treble duty on meat
make fruit and vegtables duty free
impose sugar tax
ban full sugar soda’s
reward people with normal bmi’s…
Body Mass Index (BMI) is an outdated measure of overall health. Athletic people tend to have higher BMI’s due to increased muscle mass. The many methods of measuring body fat are much better indicators of obesity than BMI.
Reward non-smokers with 6 extra vacations days for the smoke breaks they don’t take.
This could maybe work. Crank up the price of Pepsi for example I probably wouldn’t drink it as much as I do now.
I agree with all of your suggestions other than banning full sugar sodas outright. I’m a healthy weight and that’s one of my favourite treats 🙁
I think imposing a sugar tax would be effective in reducing consumption, but to ban it outright would be so sad!
blindly following the amercian healthcare model will lead to failure and bankruptcies
Part of the issue is the glacial pace of HSA and insurance reconciliations. It seems deliberately slow. We recently received a four figure co-pay invoice from a surgery performed two years prior. We paid it of course, perhaps naively. During that time, was that same long-dated receivable invoiced concurrently to the CIG as a Caymanian compensation cost, and what happens to the double credit amount in those cases? We might wonder…
If this does not get fixed/addressed does that mean the younger generations of Caymanians are screwed? Shouldn’t they get out before it gets too late? All in all, this is worrisome news.. I hope the new government is ready to pull their sleeves up and get to work from day one!
Single payer systems are a disaster: they result in a high-tax, low-productivity doom loop, as productive people emigrate, go-part time, decline promotion, or retire early, so as to avoid subsidising other people’s poor life choices. Look at the collapsing NHS in the UK.
The only healthcare system that appears to be both successful and sustainable* is Singapore’s, where people are forced to save their own money throughout their working lives into ring-fenced funds. Details here:
Overview of Singaporean healthcare system: https://youtu.be/sKjHvpiHk3s
General Singaporean political overview: https://youtu.be/Hkxf4SC_SBk
Articles:
https://www.vox.com/policy-and-politics/2017/4/25/15356118/singapore-health-care-system-explained / https://archive.is/s5jrN
https://www.aei.org/articles/the-singapore-model/ / https://archive.is/KAGV6
https://www.foxnews.com/opinion/want-to-ditch-obamacare-lets-copy-singapores-health-care-miracle / https://archive.is/p5ACR
https://www.nytimes.com/2017/03/18/opinion/sunday/make-america-singapore.html / https://archive.is/v7esg
Summary from the final (NYT, Ross Douhat) article:
“First, Singaporeans do not spend money voluntarily saved in health-savings accounts. Under their Medisave program, they spend money saved in mandatory health-savings accounts, to which employers contribute as well. Second, their catastrophic insurance doesn’t come from a bevy of competing health insurance companies, but from a government-run single-payer system, MediShield. And then the government maintains a further safety net, Medifund, for patients who can’t cover their bills, while topping off Medisave accounts for poorer, older Singaporeans, and maintaining other supplemental programs as well.
So the Singaporean structure does not necessarily minimize state involvement or redistribution. It minimizes direct public spending and third-party payments, while maximizing people’s exposure to what treatments actually cost. And the results are, again, extremely impressive: By forcing its citizens to save and manage their own spending, the Singaporean system seems to free up an awful lot of money to spend on goods besides health care over the longer haul of life.”
* Many European healthcare systems appear to be superficially successful. Sadly however, they are unsustainable because they have relied on free defense spending from the US military, cheap energy from ruZZia, and both cheap products from and a large market to sell to in China. The White House is no longer willing to subsidise European welfare provision, and both ruZZia and China are now enemies of the West.
What about people who worked in the private sector. In my case I retired from a statutory authority and my health insurance costs twice what my pension is. We need a one payer system who can bargain with drug companies and doctors. We probably have more MRI per capita than anywhere in the world and they have to be used in order to pay for them. Of course I know all we will get is more talk.
I was very happy to see this Topic on CNS , as I have been commenting on CNS platform about my situation. I am a pensioner age 66yrs. I worked with three Govt Departments. However I resigned and did not retire in service. I was told that as a pensioner I would automatically get Cinico Coverage and the Pension Board would the paperwork. I did contact Pension Board. Subsequently I was informed that I could not get Cinico Coverage as I did NOT retire in service which means post retirement I would be still covered by Cinico. I would have to take out a Basic Plan with Cinico costing around $250 monthly, from my monthly pension payment.
I think this very unfair to me and others who is in the same predicament. Every pensioner (whether resigned or retired in service) should automatically be entitled to Cinico. I sincerely hope a New Govt would look into this and ensure that all Govt Pensioners are duly covered by Cinico. It’s totally unfair for us to be paying health Insurance from our Widow’s Mite Pension. I hope it will be resolved asap.
Bring down the cost of living so we can take better care of ourselves. Most are struggling with bills so there’s very little left for healthy food or a gym membership. Plus the stress of it all is definitely causing health issues as well.
Same politicians did nothing again!