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Fund owes HPMR $9M
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Posted on Mar 29 2006
The NMI Retirement Fund has incurred a debt totaling $9 million with its third party administrator, Hawaii Pacific Medical Referral, over unpaid bills from September 2001 to the present.
Fund administrator Karl T. Reyes confirmed this yesterday but noted that the Fund “is current” with its monthly obligations with the company.
He said the Fund is able to pay $500,000 every month to HPMR.
“We are current on the monthly [payments] but we are not current with what they have been billing us. We are paying them [$500,000 every month] but what they’re billing us every month is more like $800,000,” said Reyes.
Out of the $500,000, about $93,000 is paid directly to HPMR for its services and about $230,000 to Rx America and PHI Pharmacy, said Reyes.
“What’s left goes to payment for health providers, which is not enough,” said Reyes.
Meantime, he said that of the total debt, $7 million is owed to the Commonwealth Health Center while $2 million is payable to off-island providers.
Reyes said HPMR is accredited with over 200 hospitals and medical centers here and abroad. This means that sending patients to these facilities is cheaper due to HPMR discounts.
The company said last year that from Sept. 1, 2001 to July 31, 2005, it saved the CNMI government some $16.7 million.
Overall savings are realized by deducting ineligible charges, HPMR discounts with providers, COB or coordination of benefits, and co-pay and co-insurer.
Ineligible charges refer to charges of people who are not group health plan members or services that are not covered by the plan. They also include duplicate or questionable charges.
COB refers to charges shouldered by co- providers such as Medicare, StayWell or Calvo while the co-pay or co-insurer charges are those paid by members in their premiums.
Under the Fund’s contract with HPMR, nonpayment of billings could be a basis for termination of contract.
“If we don’t pay all the billings, it’s a cause of termination of contract, but they [HPMR] won’t [terminate] since they know we don’t have money. They’re actually doing us a favor,” said Reyes.
