THE House Committee on Health and Welfare is looking into the possibility of either privatizing or transferring to the Office of the Governor the government-sponsored health and life insurance programs currently administered by the Retirement Fund.
Committee Chairman Benjamin B. Seman, in a recent interview, said these were the solutions that the House of Representatives was looking into to finally settle the “mismanagement” of Group and Health Life Insurance which, based on the independent auditor report by Burger and Comer, incurred $14 million in unpaid claims as of Sept. 2000.
“The government will continue to encounter problems if it will remain a self-insured entity. We need to look at the possibility of privatizing health insurance or move it out from the Retirement Fund and bring it to the Office of the Governor,” said Seman, R-Saipan.
But Seman admits that “this can’t be done overnight” and that there has to be a “smooth transition.”
“For instance, in privatizing health insurance, there is this problem that private health care providers won’t accept clients with chronic disease or those who have the possibility of suffering from catastrophic cases. These are some of the roadblocks so we need to have a thorough review and planning on this matter,” he said.
Rep. William S. Torres, R-Saipan, recently pre-filed H.B. 13-99, which seeks to modernize and remove the program from the Fund and transfer it to the Office of the Governor. He said “history has clearly demonstrated inherent structural weakness” in the Fund’s administration of the program. “(It has) been plagued with lapsed payments to both government and private health vendors…. The lack of autonomy in the administrative decision-making of the program may be contributing factor to the outstanding liabilities owed to vendors…. For example, the program owes the Commonwealth Health Center over $10 million,” Torres said.
But Retirement Fund Chairman Vicente C. Camacho said GHLI’s transfer to the Office of the Governor “would not solve the current dilemma GHLI is presently facing.”
“Six years ago, I did ask the Legislature to remove GHLI under the umbrella of the Fund. This fell on deaf ears. Now that we have identified the problem and fully addressed the findings of the Legislature in this proposed bill, the Legislature finds it ‘outmoded’ and should revert back to the government, (which) just doesn’t make sense,” said Camacho in a recent position letter on H.B. 13-99.
He said all the issues raised in the bill had been fully addressed by the hiring of a third party administrator. “We can’t get any better that what we did…. I sincerely believe that if this program is given a chance to mature, it will be successful. Remember that we started from scratch. When the Legislature created GHLI, it never funded it nor addressed the hiring of an actuary to determine the feasibility of the program,” he added.
