Tyrone Reid and Edmond Campbell, Staff Reporters
A major shake-up is looming in the health insurance industry as the 65,000-strong Government Employees' Administrative Services Only (GEASO) health scheme, which is the single largest health insurance scheme in the country, currentlly valued at a little more than $2 billion per annum, is about to change hands.
The imminent switch of the health care provider comes as a result of aggressive intervention by the Contractor General, Greg Christie, into the awarding of the multibillion-dollar contract, which has not been put to competitive tender for 10 consecutive years.
Mr. Christie in his recently released annual report revealed that the Government consistently breached its own guidelines by awarding the contract to Blue Cross of Jamaica Limited from 1995 to 2005 without competitive bidding.
In a press release issued yesterday the Finance and Planning Ministry said that the arrangements with Blue Cross have been part of an understanding with the unions.
The release stated further that in December 2005, Cabinet directed that the scheme be put to competitive tender.
Tender withdrawn
The scheme was eventually tendered in September 2006. However, after intervention from the Contractor General, the invitation to tender was withdrawn and re-tendered in December 2006. But the ministry's release made no mention of the intervention by the Office of the Contractor General (OCG).
"We stand by everything we say in our report. It was after the intervention of the OCG that the Ministry of Finance withdrew the tender," Mr. Christie said.
The Ministry's statement added: "Proposals from the health insurance industry have since been evaluated and submitted to the National Contracts Commission (NCC). The unions are now perusing the proposals and evaluations and every effort is being made to complete this process by the end of this month".
"NCC will then submit their assessment and recommendations to Cabinet for final approval."
At the same time, highly-placed sources told The Gleaner yesterday that the Ministry of Finance sent its recommendation to the NCC, signalling its desire to award the new contract to Life of Jamaica (LOJ).
The source also revealed that the NCC responded to the Ministry of Finance, by way of a letter to the Financial Secretary, Colin Bullock, on May 31, endorsing its recommendation.
This effectively clears the way for the Finance Ministry to submit the document to Cabinet for approval that would usher in the new dispensation. This is mandatory because government guidelines demand that all contracts in excess of $15 million be approved by the Cabinet.
However, in an interview yesterday, Mr. Bullock expressed shock that the information was leaked to the media.
"I cannot comment on that matter, I have no idea of how you would have gotten hold of a letter like that isn't that supposed to be a confidential letter," he asked.
Mr. Bullock later confirmed that the NCC has reviewed the submission and added that it is now being examined by the GEASO worker monitoring committee, which comprises representatives from the different categories of workers.
At the end of this review, he said, it is expected that a submission will be made to Cabinet.
When asked to confirm or deny that the NCC has endorsed LOJ as the best choice, Mr. Bullock said: "That would be grossly improper of me. In a sense, no recommendation has any validity until it is finally endorsed or denied by Cabinet," he stated.
Information Minister, Donald Buchanan confirmed that the matter is yet to come before the Cabinet.
However, Mr. Christie confirmed that the NCC has endorsed the Ministry's recommendation that the contract be awarded to LOJ.
"On May 30 the NCC considered the Ministry's recommendation for endorsement in favour of an award to LOJ and the NCC endorsed the recommendation," he said.
Mr. Christie's claim was validated by the NCC's Notice of Endorsements for May 2007 that was released late yesterday and showed that the fee for administering the scheme would be $148.93 million.
