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(CNS): The Health Insurance Commission (HIC), in consultation with the Cayman Islands Monetary Authority (CIMA), conducted an investigation last year of the local insurance company Cayman First Insurance following complaints about its failure to pay legitimate claims to healthcare providers. During the investigation, the regulator found a number of problems at Cayman First, including a staff shortage and problems with a new claims system. As a result, the HIC said it had imposed a series of conditions on CFI, which the insurer must comply with to maintain its Approved Insurer Certificate.
In a statement issued on Friday, the HIC said it had been in contact with CFI senior leadership (president and VP) via weekly phone calls, regular exchanges of emails and frequent updates. It also conducted a site visit to the CFI office.
“CFI senior leadership has assured the HIC that these issues are being addressed, but that they will require some time for complete resolution of the challenges,” the HIC said. “Even though the HIC recognises the efforts which CFI has made in working to rectify the situation, the HIC has, nonetheless, imposed a series of conditions on CFI with which the insurer must comply.”
This includes the production of its quarterly financial reports for the year 2022, a written mitigation plan for the system integration and restoring appropriate staffing levels, monthly reports for historic (over 30 days) and current outstanding claims, and a timeline for the clearance of identified backlogs. The company must also provide the HIC with a complaints-handling policy.
CFI was expected to provide an update to the HIC today. The commission will also be ensuring the insurer provides stakeholders with more regular updates on adherence to the conditions and monitoring its progress to resolve the issues as a matter of public interest.
Although the HIC received only one informal complaint from a registered healthcare provider, the commission said there were other indications in the public domain that a number of providers had been impacted by non-payment of claims. Under the Health Insurance Regulations, insurance companies that fail to pay undisputed claims within 30 days are liable to pay interest on the money owed from the 31st day after the claim has been submitted to the date on which payment is made to the health practitioner.
Cayman First denied having any significant problems in a statement issued in November. The company said that rumours were circulating in the market regarding the financial health and stability of CFI and any concerns about its “operations and outlook are completely unfounded”.
CFI said it had paid claims totalling millions of dollars each year and its financial strength was affirmed in 2022 as A- (Excellent) with a stable outlook by rating agency AM Best. But it also said it had recently made a significant investment in a new system implementation that had presented some “initial hurdles that appeared during the first phase of our rollout” and it was “working diligently to transition to full functionality as soon as possible”.
Cayman First claims that payments continue to be processed for all providers and that providers had confirmed they were accepting member ID cards. However, a number of long-serving employees have resigned recently and others have been fired, and CFI admitted that there were some staffing issues.
“As is the case in the business world, companies may find that there are different views among the leadership on how to evolve various aspects of the business and may agree to part ways with team members,” CFI said in the statement, adding that it continued “to advance our people as we welcome new leaders to our team”.
Registered healthcare providers and clients impacted by non-payment of claims or other concerns are encouraged to file a formal complaint or contact the HIC by emailing hic@gov.ky or calling 946- 2084.
The HIC office is located at the Government Administration Building.
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