Sen. Regina Mesebeluu who chairs the Senate Committee on Health and Education in an interview said that the landmark measure was passed on third and final reading by the Senate on Friday.
Senate Bill No. 8-48 was originally introduced in March 2009 and after consulting with the members of Ad Hoc Committee on Health Care and the technical assistance group funded by the Asia Bank, the Senate Committee on Health and Education reviewed the bill and recommended several changes into the measure.
The measure recommended that the Social Security Administration will manage the funds collected for the system and creates a Healthcare Committee, comprised of government officials.
The measure is comprised of two components, the Medical Savings Fund, made up of individual Medical Savings Accounts. The measure recommended that all employed persons in Palau, as well their employers and the self-employed, will pay into the Medical Savings Fund.
The fund will be comprised of individual Medical Savings Accounts, which may be used to cover most medical services, including regular check-ups and outpatient services. The health insurance benefit will complement these accounts, covering higher-cost medical procedures, including those that require inpatient care at Belau National Hospital or medical referrals.
The proposed payment into the fund are the following; for employees: a minimum of 2.5% of their insured earnings; for employers: a minimum of 2.5% their employee’s earnings; and for the self-employed, will pay both the employee’s and the employer’s share, for a total of minimum contribution of 5% of insured earnings.
Aside from the contributions, various loans and grants may be paid into the fund. These funds may come from foreign governments, from appropriations from the National Government, or from grants from non-government organizations such as the ADB.
According to the measure once funds become available, a person may use them for any healthcare services not explicitly excluded by law or regulation, for health insurance subscription costs, for premiums for private health insurance benefits.
Under the measure, a person becomes eligible for coverage by the health insurance benefit after two full quarters of paying into the health care system. The health insurance benefit will generally cover inpatient care at the Belau National Hospital and off-island care that is approved by the Medical Referral Committee. The coverage will be subject to a co-payment, which will be the responsibility of the covered patient. The amount of the copayment will be 20% of the cost of the medical service, but will be capped based on a sliding scale, to be determined by income.
For general medical services that cap will be from $200 to $400, and for inpatient care or medical referrals, it will be anywhere from $1,000 to $4,000.
The program will have an initial start up cost of $50,000 to provide the necessary equipment to efficiently administer the health insurance program.
The measure will “ address maintaining low administrative costs by using existing infrastructure, providing equitable access to off-island care by pooling the risk of these high costs, providing a sustainable source of financing for health care to supplement government funding, and promoting reduced costs by providing incentives to the population to improve their health status.”
This bill was first introduced on March 18, 2009 by all Senators, and was referred to Health and Education Committee.
After reviewing summaries of the bill, H&E committee worked with the Health Steering Committee which consisted of the local health experts Minister Kuartei and Dr. Yano, and ADB technicians Mr. Hennicot and Mr. Knowles, as well as government officials Mr. Greg Ngirmang and business leaders such as Ken Uyehara, to understand the technical background of the bill and develop further improvements to it.
In July, 2009, H&E Committee worked directly with Senate Legal Counsel, as well as the legal counsel to the Social Security Administration, to further amend the Bill.
The committee also consulted with actuary Jean Claude Hennicot and economist James Knowles, who provided technical data on the bill to help ensure that the system will be fiscally sound and self sustainable in a long run.
On July 17, 2009, the Committee held a public hearing on the Bill, at which many individuals from the public, as well as technical experts, voiced their support for the legislation.
Mesebeluu said that committee memberswho were previously skeptical of the legislation saw its value and also began to support it.
• After the Committee hearing, the Senate Legal Counsel worked with the Social Security Administration to include the financialrecommendations made by Mr. Hennicot and Mr. Knowles.
The senator said that by the end of October, the bill had passed the 3rd and Final reading with full support from the Senate. It was then sent to the House of Delegates.
The House independently reviewed the bill and held numerous meetings with SSA as well as local health experts and returned it to the Senate with amendments on January 28, 2010.
Mesebeluu said that the Committee with the Senate Legal Counsel have reviewed the amendments from the HOD and found that they are only minor technical changes and does not change the intent of the health bill.
“The health bill is for the people of Palau. We believe that it is people’s turn now,” Mesebeluu said.
She said that the measure once signed into law will also help the Ministry of Health reduced debts owed by patients.
Outstanding obligations due to the hospital reached $12 million.
The amount was accumulated since 1996 and these are unpaid obligations from Medical referral amount to $3.6 million while Filipino foreign workers owe $970,000 in medical bills. Within Palau , $7 million is owed to the ministry. Other nationalities owe $790,000, Pacific Islander’s meanwhile owe $15,000; Caucasians, $247,000; Japanese, $48,000; Chinese, $100,000; Koreans; $25,000 and all other nationalities amounting $112,000.
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