GHLI owes hospital, vendors $17.4M

The government-run Group Health and Life Insurance owes health providers and other vendors $17.4 million in “aged” payables, almost 88 percent or $15.3 million of which is owed to the Commonwealth Health Center, the Rota Health Center, and the Tinian Health Center.

Aged payables are those due by over 90 days as of March 31.

These vendors are in the CNMI, Guam, Hawaii and the U.S. mainland.

David S. Demapan, comptroller of GHLI, said the remaining amount is owed to Aetna’s runoff claims prior to Nov. 1, 2007, $193,084; Netcare Life & Health Insurance Co., $182,841; Individual Assurance Co., $499; and all other vendors mostly pre-Aetna runoff claims, $1.8 million.

Demapan, in his latest financial report, said GHLI’s revenue reached only $6.5 million during the first six months of fiscal year 2009, an 11 percent drop from the same period last year.

He said the government’s non-payment of $1.2 million in employer contribution is the main reason for the overall drop in GHLI revenue.

GHLI also collected only $6.4 million on medical insurance premiums during the first six months of FY 2009.

“The rate hike of 12.9 percent on Nov. 1, 2008, is the main contributor for the 6 percent drop,” said Demapan in his report to the NMI Retirement Fund board of trustees.

The government health and life insurance program generated $109,598 on the 5 percent surcharge imposed on the life insurance premiums. The surcharge is used to pay off the investment in GHLI by the NMI Retirement Fund.

Fiscal year-to-date medical claims amounted to $5.4 million. In March alone, $1.6 million was to Aetna Life & Casualty Bermuda for the health insurance premiums but GHLI has not received the billing yet. GHLI also paid $365,828.50 to Netcare Life and Health Insurance Co. in March alone.

Demapan raised two concerns affecting operational costs: the unbudgeted item of the interest portion of the debt service payment to investment in GHLI by the Retirement Fund, and the unbudgeted salaries and benefits of GHLI employees transferred to the Retirement Fund.

The comptroller said the available cash of $712,445.50 will be used to pay Netcare Life and Health Insurance Co., Aetna Life and Casualty Bermuda, and investment in the NMI Retirement Fund.