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Nhi Chief Pledges Lower Business, Individual Cost

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

THE National Health Insurance Authority’s (NHIA) top executive yesterday pledged that its revised proposal will reduce the cost burden for Bahamian businesses and individuals.

Graham Whitmarsh said that only the government’s costs had increased slightly, from $20m to $22m, under the altered contribution/taxation schedule unveiled this week.

“The total cost with the original plan, which was $106m, had $20m of which will be borne by government,” Mr Whitmarsh said. “The government has many employees that do not have private health insurance today and they will be required to purchase a standard health benefit for them. A cost to business will be $53m, and a cost to individuals of $33m.

“As a result of these changes the government’s cost has gone up slightly from $20m to $22m, but the cost for individuals has gone down. These proposals overall reduce the cost burden for both business and individuals. How a business or individual benefits would depend on their particular circumstance.”

Mr Whitmarsh said the staggered roll-out for companies was among several policy changes the NHI Authority is proposing. “We had proposed having an implementation that was split, with bigger companies on January 1, 2020, and smaller companies on January 1, 2021,” he added.

“What we now propose is to bring those two together and to launch both the bigger and smaller companies on July 1, 2020. This gives us an additional six months for implementation. This is particularly helpful to the private health insurance industry that needs time to adapt the way it does business. It allows us perhaps six months to go forward when they’ll still have a full 12 months before we would implement. It also brings up the implementation of the smaller business from January 1, 2021, to July 1, 2020.”

Mr Whitmarsh highlighted another policy change over premium sharing. “One of the first changes was based on the feedback we got around the premium sharing, the 50 percent for employer and the two per cent for the employee,” he said.

“We decided to change that. Many people suggested that higher income earners should contribute more, and that lower income earners should contribute less. What we propose now is to reduce that contribution by employees from two percent to 1.5 percent and remove the 50 percent cap.”

The NHI chief continued: “The third change we had proposed was around the definition of a small business. We had originally proposed that this would be a business that had $100,000 on their business license.

“We actually proposed increasing that to $250,000. This now would exclude businesses between $100,000 and $250,000, who would have been in the mandate previously. Individuals that work for companies of that size would get their benefits from NHI; they would not have to have their employer purchase a private health insurance for them.”

Tribune Business previously revealed that the NHI Authority, in a late afternoon briefing for the medical industry and private sector on Wednesday, unveiled a revised tax/contribution schedule that - at the top level - requires high-end management executives earning more than $66,667 to pay 100 percent of the annual $1,000 Standard Health Benefit (SHB) premium.

Regarding enforcement and compliance, Mr Whitmarsh said: “We had suggested that we do it through the business license. Businesses would have to demonstrate that they met the obligation to provide the insurance to their employees prior to it being given a business license for the following year.

“We received some feedback that already people felt that business license was a complex piece of paper that they need to obtain every year, and this would potentially make it more difficult and be more destructive for them. We have some empathy with that, so we would be working with the Department of Inland Revenue to find a way that we can ensure compliance ourselves.”

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