Tobacco fund to finance GHLI transfer

Initial funding capital of $1 million from the Tobacco Master Settlement Fund and health premium will be used to finance operations of the proposed CNMI Health and Life Insurance Trust Fund Program.

The proposed legislative measure is in response to earlier recommendations made by the Group Health Life Insurance Program to study possible transfer of GHLI Trust Fund to the purview of the Office of the Governor.

The bill also tasked the Department of Finance to identify funds from any source including the Tobacco Master Settlement Fund, health premium, life insurance administrative cost revenues, or personnel lapse funds in any executive department in order to establish a claims of disbursement trust account for the health insurance program.

It will be initially funded with $450,000 in reserve account and $500,000 in revolving account to expedite processing of claims.

The proposed CNMI Government Health and Life Insurance Improvement Act of 2001 authored by Rep. William S. Reyes aims to improve the delivery of GHLI system and eventual transfer of the program under the Governor’s Office.

By establishing the trust fund, Mr. Reyes assured that the credibility of the program will be properly maintained especially in light of the increasing unsettled medical bills to off- and on-island health providers.

“The lack of autonomy in the administrative-making of the program may have contributed to the current liability of the GHLI to the vendors,” said the legislator.

To date, GHLI still owes the Commonwealth Health Center over $10 million since the transfer of the program administration to the NMI Retirement Trust Fund in 1996.

The program continues to face a stack-load of cumulative accounts current, and is still unable to make timely payments to private health providers.

Mr. Torres saw the need to immediately transfer GHLI to the government to ensure the fiscal solvency of the NMI Retirement Fund’s current and future membership.

“The mounting liabilities in the health insurance program may likely impair the independence and focus of the Fund on the direct well-being of its primary clients, the present and future retirees,” said the congressman.

The purpose of the Act is to remove the program from the NMIRF and to transfer it to the Governor’s Office under the discretionary authority of the appointed administrator.

The proposal also repealed in its entirety the management, operation and audit provisions of 1 CMC Division Section 3 and 4.

Earlier, GHLI Manager Dolores Moore asked House Committee Health and Welfare Chair Malua Peter to explore the possibility of appropriately placing GHLIP under the Office of the Governor’s responsibility.

The transfer will enable the program to be more efficient in addressing the issues that have continuously plagued it, Ms. Moore explained.

The program manager further explained that presently GHLITF is in dire need of an updated actuarial study to enable the program to align its fee schedule more accurately.

By aligning fee schedule more accurately, it will cover actual medical costs in the CNMI, Guam, Hawaii, and the US Mainland, she pointed out.

The GHLIP disclosed that since the inception of the Trust Fund, the resources of the program have not been adequate to pay all medical claims of GHLI subscribers.

In fact, Ms. Moore said even these claims are processed by the GHLIP, the Trust Fund accounting division could not disburse payments to vendors due to continued funding shortfall.

The GHLIP based on the recent itemized cost breakdown released, is in need of over $4 million funding assistance from the Legislature to settle medical bills on more than 295 off and on island health service providers. (EGA)