Claude Mills, Staff Reporter
CONSUMERS, ALREADY overburdened by a spiralling cost of living, may not be looking at a doctor's visit with the same trepidation as they did last year as they are set to benefit from saving a $500 million windfall on reduced insurance premiums this June.
The axing of the unpopular General Consumption Tax (GCT) on health insurance premiums was announced by Minister of Finance and Planning Dr. Omar Davies at the House of Representatives last week.
Health insurance providers in Jamaica are breathing a sigh of relief at the Government's decision.
David Garel, Blue Cross Jamaica vice-president for marketing and customer service, believes that the decision will have a "positive effect on the public's ability to afford adequate health care. This move will allow companies to better cover the needs of their employees, and by extension, facilitate a more productive and healthy workforce."
Health industry insiders have for months expressed concern about 'underinsurance', and the reduced levels of health insurance coverage which have resulted from the imposition of GCT on health insurance premiums, and had called for the Government to reconsider this decision. By their estimates, over 600,000 Jamaicans were negatively affected by the imposition of the tax.
Last year, Opposition Spokesman on Finance, Audley Shaw, pointed out that with 2002 premiums costing $3.5 billion, an additional $525 million would have to be paid by employees and employers to keep the same level of health insurance coverage between June 2003 to June 2004.
"It was a burden on the system, a shortchanging of people who needed health insurance, and it was a bad decision," Mr. Shaw said.
"If the Minister of Finance would only display a little less arrogance, and take time to analyse the impact of his decisions, he would not continue to compromise the people of the country in the many and varied ways we are being compromised," Mr. Shaw said. "This is yet another example of him going back on a decision which, if only he had contemplated properly in the first place, he would never have made."
In the meantime, Danny Roberts, vice-president of the Jamaica Confederation of Trade Unions (JCTU), hailed the decision as a "welcome move".
"It removes a burden off the employees especially because the cost of health insurance would have eventually been transferred to them, and anything that can be done to ease their situation right now is welcome," Mr. Roberts said.
Last year, the Jamaica Employers Federation (JEF) was outraged at the Government's proposal to introduce GCT on health premiums. It affected new policies and became effective June 1 last year. This year, the JEF has a reason to smile.
"We are very pleased with the decision of the Minister to lift the tax, I am glad that he took our advice as it (the tax) had become a serious burden on employers. Health is not something that you can compromise on, and the private sector is always willing to provide the best insurance benefits for its workers, but it has to be affordable," said Jacqueline Coke-Lloyd, executive director of the JEF.
Economists believe that employment and income level are the leading indicators of health insurance coverage in the country, and that the lower the income level, the more likely a worker will not have coverage.
