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Charlotte Amalie
Sunday, February 25, 2024
HomeCommentaryOpen forumWe Can Solve Health Care Issues in the Virgin Islands

We Can Solve Health Care Issues in the Virgin Islands

Dear Source:                                          

There is a solution for the three main areas of concern we face regarding healthcare in the territory: Quality, Cost and Availability.

I’ve spent a portion of my career engaged in projects involving the industry of health insurance and, as a resident of the Virgin Islands, I’ve observed the challenges we are faced with. Our community deserves facilities and staff that are on par with stateside equivalents. Our hospitals struggle under the financial burden of uncompensated care, inefficient processes (lost revenue opportunities), and reduced Government funding, which resulted in a drop in service to the point where one facility was at risk of losing CMS accreditation. Those with insurance seek alternatives to local treatment for elective matters, either stateside or in neighboring Puerto Rico, further reducing revenue sources.

Insurance premiums in the territory have skyrocketed, with reduced coverage and increased deductibles. Insurers incentivize patients to travel to Puerto Rico for treatment by lowering co-pays and in some cases reimbursing flights. This is likely due to higher reimbursement schedules therefore even the local providers must take some responsibility for the discrepancy in coverage.

And, even if an individual could afford the premiums, there are simply no health insurers doing business in the territory that offer individual coverage – if you are not employed by a sizable business, you are out of luck. This is a major disincentive for budding entrepreneurs and small businesses.

There is an approach, consisting of four parts, that may help solve these issues. 

But first, let’s start with a little analysis. When trying to impact any marketplace you must consider the largest customer. In our case, it is no surprise this is the government. They have the largest number of employees in the territory and therefore the largest number covered under any insurance plan, especially when you add in retirees covered. This results in huge premiums paid to the government’s health plan provider of choice. Insurance providers are in the business to make a profit based upon the risk of a given population. Even though this profit is now limited under the affordable care act, an acceptable margin is just good business.

The first part of the solutions is for the government to establish its own independent health plan. Premiums would still be paid by the government departments to this new insurer, however premiums should be slightly lower due to the elimination of the insurers profit margin. The bulk of processing membership, claims, and other services associated with a health plan can be outsourced to third party administrators. We don’t need to build everything from scratch to make this happen.

The second part of this solution is going to be politically tough for the government. In recognizing the positive strides made by our hospitals toward improved quality, the new health insurance plan would be heavily skewed toward the utilization of local health care providers and government facilities. Any off-island treatments would be subject to punitive co-pays. This immediately results in two things. Firstly, an increase in the utilization of our local health care facilities, meaning more spending retained locally. Secondly this results in a new level of demand for the highest level of care, that our facilities must be willing to meet. This is where we start addressing the first of the three areas of concern – Quality.

The third part of this solution is in how the new health plan negotiates reimbursement rates with providers and facilities. Now that it represents the bulk of their patients, and has guaranteed an increase in utilization, some reduction in fee schedules must be made. This again is not necessarily the most popular option but something must be done to reduce our overall health care costs. This partially addresses our second area of concern – Cost.

The fourth part of this solution involves opening the new health plan options to all residents of the Virgin Islands. Yes, any individual, or group, should be able to purchase the same health care coverage as any government employee. This addresses the third area of concern – availability.

None of this is intended to replace the insurance companies that are doing business in the territory today. They would still be welcome to offer commercial coverage to any businesses as they do today. However, in order to remain competitive they may need to make their products more attractive and reduce premium accordingly.

Even our past president has been vilified over health care, so I’m not expecting any major changes to happen here. But as an academic exercise the above steps, while highly simplified, are yet eminently doable. The solutions would require strong leadership, solid planning and an unending supply of political support. The greatest risk associated with this approach would be in ensuring the government departments pay the premium deductions and contributions promptly. As we have seen with the retirement system contributions, this is an area of concern.

There are other benefits to having a government health plan and infrastructure – including the ability to quantify uncompensated care, by registering every user of our facilities as non-contributing members of the insurance plan; however, these and other benefits are added value to the core objectives mentioned above.

The ability to positively impact the quality, cost and availability of healthcare in the US Virgin Islands is an option, given strong leadership and dedication of a responsible VI Government.

Scott Johnston, St. Thomas

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  1. I appreciate the points you have made. It is evident you know your industry, and are trying to find a solution to our insurance desert here in USVI. While I am leery about having any participation with a VIG administered insurance program, there are quite likely those in the private sector who would welcome it. I have asked about a group policy for members of the business community, e.g. Chamber of Commerce, but have been told that is not available, unless you count Mapfre, which I believe is a major medical type insurance (correct me if I’m wrong). The insurance premiums my small company pays with UHC are expensive, and this year we are looking at an 18.7% increase. We have never not had an increase in double digits. One year it was 75% (BCBS)! And the deductible is as bad as a major medical policy. For insurance to kick in at 80/20, in my personal situation I have to shell out $5000 per year ($10,000 per family of four), in addition to monthly premiums of $1450.00. That is a total out-of-pocket cost of $22,000-27,000 per year before insurance covers anything. Judging by the increasing costs and decreasing benefits, I see no relief ahead.

  2. Yeah, we always go Stateside for services unless we absolutely cannot. The reason? The inexplicable 20% surcharge for anything done in the V.I. This was 10 years ago, we were paying over $1400 a month, CIGNA then UHC bouncing in and out, and telling us the excess charges from the Hospital and local medical were unjustified by 20%, therefore we had to pay the differential. It was obviously simply cheaper to fly Stateside to the finest facilities in America. Then Tilloglobe came up with a reasonable alternative for “expatriate” coverage. I had friends that used it for emergencies, a knee replacement, emergency surgery, etc., etc. and it worked fine. But the powers fought them and seemed to have eliminated the availability, apparently because some local firm(s) were losing business to them. Circa 2007, Tilloglobe’s policy was less than $2000/yr., where CIGNA or UHC was approaching $1500 a MONTH for two adults. Single payer, eliminate the profit center that IS “healthcare insurance” – the people standing between you and your doctor filling their pockets with cash. Ever hear the Nixon White House recordings on the matter? He thought it was a great idea and his buddies would “make millions.” They sure did.

  3. In concept this seems like a very good idea, except 2 major points of concern:

    1—the main ingredient for a self insured product is financial discipline and this Gov’t is the exact opposite of that. Look at the GERS contributions, ( I believe there hasn’t been any contributions since sometime in 2016). Everyone knows the Gov’t doesn’t pay or slow pays vendors. Doctors, pharmacies and other medical professionals will leave in droves. And then we will have medieval medical care.

    2—while procuring individual insurance is virtually impossible, a business does not have to be “sizeable” to obtain reasonable coverage. There are at least two carriers writing groups down to 2 lives and, in some instances, only 1.

    Unfortunately, bullet point #1 is the one and only reason it will not work.
    #2, is mearly pointing out that you are correct but not totally correct in what you say about obtaining healthcare benefits.
    Good article Scott.

  4. I would love to visit with the author of the letter. I can easily be found on any search using my full name.

    I have worked on two different options for the community for years with other local professionals who combined forces and knowledge bases to solve the issue for all of mutual benefit. Bottom line, someday all of us will need care, or someone you love will. We better have facilities on island to take them to that are staffed and functioning.

    One intense effort was VIHealthCare- everyone in, nobody out. There was little interest at the higher levels in considering a well thought out, fully budgeted, customized to our unique issues community wide plan for every resident we build and manage ourselves, including a built in reserve for hardships or population swings for a time in a trust separated from the general fund and untouchable except for our community health care.

    The second is not traditional health insurnace. That title of product offering is not working in the VI from any vantage point. Insurers simply don’t want us on their books and have left in droves over the years. The fact there has not been one individual policy available for sale at any price since 2010 supports this fact. The few policies here for groups are expensive and continuing to climb in premiums required with no limit in sight.

    In the fall of 2016 I secured a relationship with Altrua HealthShare for the VI with eight different plans. Yes I said eight. This is an alternative to traditional health insurance for like minded individuals and families at a very affordable cost for those who qualify.

    The reception to this new idea of a medi-share plan instead of traditional insurance that is one of only five medi-share programs exempted from the ACA/Obamacare mandates and tax penalties has been cool to a new idea or alternative for us to use. I continue my efforts to educate in this area.

    Medi-share type ministires have successfully paid out billions of dollars in heatlh care expenses for members since the 1980’s. The Biblical concept of ” sharing one another’s burdens” is not new, the information in this community on Medi-share alternatives is.

    We are all in this community together. There is no reason we cannot create solutions that work for us to help ourselves as members of the community. You do not have to hold a public office to make a difference.

    Medicare is not the villian because it does not cover those under age 65.

    Cigna government employees and retirees group is not the villian because they do not cover small businesses who ironically pay taxes to subsidize their premiums!

    Small businesses with group policies I see as a vanishing segment are not the villian because they are paying out fortunes for those policies.

    The few on Medicaid are not the villian because they are below poverty level.

    The uninsured are not the villian because there is nothing to buy!

    Those who choose to use medi-share programs such as Altrua HealthShare are not villians because they found something they could work with to eet their medical expense needs.

    “The rich” who ever you think they are cannot be villians because they pay cash!

    There is no single solution. It is a patchwork quilt of workable ideas woven together that will cover us all unless we build a plan ourselves that covers us all and removes all of the squares above. The only other alternative is to take it all away and we have nothing to cover us.