Editorial | Healthcare and moral hazards

No one will begrudge the access Jamaican entertainers and other creatives are being afforded to health and life insurance via a government-supported scheme.

But with taxpayers picking up the tab for its premiums, there are likely to be questions of whether the Government is creating a moral hazard to be exploited by other groups and sectors. It also reminds of the long-proposed national health insurance scheme, which appears to have been quietly abandoned.

These matters must be addressed with frankness and clarity.

Earlier this month, at a function attended by a slew of dancehall artistes and others from that industry – including the dancehall DJ Vybz Kartel – the culture and entertainment minister, Olivia Grange, launched the scheme, to resounding acclamation. Guardian Life Insurance group is the provider.

Already, more than 4,400 entertainers and creatives and over 400 small, industry-related companies that are on the government’s National Registry of Entertainment and Creative Practitioners, are covered by the schemes. Others will be included as they join the registry.

As Ms Grange pointed out, members of the scheme won’t pay a monthly premium. Or any premium at all.

The Government will cover the annual cost, initially at J$55 million. Or, as Ms Grange put it, the money will “come directly from the Consolidated Fund”.

In the scheme’s launch phase, beneficiaries will be covered for up to J$500,000 in life insurance. From January, when the health and personal accident portion kicks in, they will be eligible for a wide range of health services, including emergency overseas coverage.

The current age of eligibility is from six to 75, but with an option to extend to age 99.

NO COVERAGE

What was painfully laid bare at the function was that while some of the entertainers may enjoy health insurance through their membership of domestic royalties’ collection bodies, large swathes, especially the older ones, have no coverage – or insurance of any kind.

Indeed, Minister Grange hoped that this scheme – which largely mirrors one for athletes – will prevent what has happened in the recent past: having to “pass around the hat to bury anybody”.

Dionne Jennings, the permanent secretary in the Ministry of Labour and Social Security, lauded the scheme for its recognition of the “tangible legacy” that entertainers and other creatives provide to Jamaica.

Which indeed is fully understood, and celebrated, by this newspaper.

However, the problem of access to, and affordability of, healthcare is not unique to entertainers and creatives. It is widespread. And the perception is likely to be that entertainers, and other people in the creative industries are economically better off than the vast majority of working Jamaicans.

However, only an estimated 25 per cent of Jamaicans are covered by private health insurance schemes, a figure that is slightly above the amount in private pension plans.

The upshot for the majority of Jamaicans is that if they fall ill they have to depend on the island’s mostly overburdened and understaffed public hospital and clinics, where waiting times are usually long and service, in too many instances, indifferent. In some cases people forgo healthcare.

It is against this backdrop that Jamaica, has, on-and-off over several decades, debated the question of a national health insurance scheme.

In the latest iteration of this discussion, the health minister, Christopher Tufton, in 2022 named noted economist, Damien King, to lead a task force to determine the design and funding of a national health insurance scheme. Little was subsequently heard of the task force: no report; no report of outcomes. Which is surprising given that Dr King, a former University of the West Indies economics lecturer, was known to be bullish on the value and possibilities of a national health insurance scheme.

WHAT BECAME OF THE STUDY

Health Minister Tufton should say what became of the study, if a national health insurance scheme remains on the government’s agenda and how one could be funded. A national scheme, on its face, would seem a better option than mini, enclave arrangements like the ones the government has created for athletes and creatives/entertainers.

For the current fiscal year the government has allocated J$133.7 billion, or 9.7 per cent of its budget, for direct spending on healthcare delivery – hospitals, clinics and related operational services.

That, however, is not the entirety of the State’s expenditure on healthcare. The National Health Fund (NHF) spends billions subsidising drugs for people who mostly suffer from non-communicable, lifestyle diseases (NCDs) like hypertension and diabetes.

Financed via 20 per cent of taxes paid on tobacco products, five per cent of all special consumption taxes and one per cent of contributions to the national insurance schemes (NIS), the NHF has over 775,000 subscribers, who in 2023/24 received J$7.8 billion in benefits.

By most estimates the government is responsible for around 65 per cent of Jamaica’s annual healthcare expenditure, which suggests private expenditure of around J$75 billion, not accounting for inflation.

The bottomline is that there is a lot of money sloshing around in the healthcare system, from both the government and private individuals. The matter to be determined is whether this money is being efficiently spent, and if it is sufficient to sustain a national health insurance system. And if not, how much more would be required and how the additional amounts might be raised. Another consideration is whether the NHF, an agency that provides excellent customer service, could be the platform upon which to erect the larger system.

Dr Tufton must speak to the matter. But not just him.

Noticeably, the question of a health insurance scheme hasn’t been on the public agenda of the political opposition, which regularly points to problems in the health sector. Do they have a position?