Opportunities missed to stop CarePay contract

Lonny Tibbetts, CEO of CINICO

(CNS): Two public servants who gave evidence in the CarePay case Tuesday both revealed missed opportunities for putting a stop to the costly hospital payment system contracted to AIS Cayman, which never worked as intended, before millions of dollars of public cash was lost. Carroll Cooper from the health ministry recounted his refusal to pay an invoice submitted by AIS, and Lonny Tibbetts of CINICO said he had put AIS on notice about terminating the contract when the firm refused to give information to address fundamental problems.

Cooper was the chief financial officers in the ministry of health when an invoice arrived from AIS addressed to the ministry and not the Health Services Authority (HSA) for over $1.2 million to begin the national rollout of the CarePay system. Cooper told the court that despite efforts by the chair of the HSA board at the time, Canover Watson, who is charged with fraud offences in relation to the contract, to persuade him to pay it, he repeatedly refused. Cooper said there was simply no basis for the ministry to pay the invoice as it related to a project between AIS and the hospital, not the health ministry.

The court heard that although Cooper stood his ground over the issue, the invoice was eventually paid by the HSA, despite questions surrounding the existence of any contractual obligation.

According to the crown’s case against Watson, one of his alleged offences is that he doctored the original contract signed between AIS, the government’s insurance company, CINICO, and the hospital for the CarePay system to make it look as though the potentially very lucrative national rollout of the system was a contractual obligation of government.

In the end, even though the money was paid to AIS, the rollout of the system to include private insurance providers never happened due to major technical problems that plagued the implementation of the verification system.

Chief Executive Officer of the Cayman Islands National Insurance Company (CINICO) Lonny Tibbetts, who also gave evidence yesterday, explained how the CarePay system, which everyone had hoped would revolutionise the payment issues at the hospital, was in fact going badly wrong. The goal of the system was that when a person insured by CINICO turned up at the hospital for treatment, staff could verify in real time the level of cover that person had and what, if any, contribution they would need to make towards their medical bills before they left after treatment.

But instead of giving the accurate real-time clearance that the authorities had hoped for, the system was clearing and verifying cover for people who did not have it, making things worse. Tibbetts described the mounting frustrations as he had been given the remit as part of the job to implement a payment system that worked and two years after the contract was signed, it was not working.

He told the court that he and the CEO of AIS, Doug Halsall, had clashed when AIS refused to give CINICO the technical information it needed to sort out the fundamental programming problems that were causing the system to clear patients who were not covered and costing CINICO money that it was not obliged to pay.

He said a letter was sent to AIS notifying the company of plans by CINICO to start legal proceedings for breach of contract. However, Watson played a key role in smoothing things over, getting everyone talking again and preventing the contract termination, he said.

Tibbetts said he was unaware that Watson had emailed Halsall to warn him about the impending contract termination following a CINICO board meeting ahead of the formal legal letter of notice.

The case continues.