GREAT BAY--Social and Health Insurances, SZV, says it is implementing a Financial Sustainability Strategy aimed at controlling healthcare costs, improving premium collection, preventing fraud and reducing dependence on costly overseas medical referrals.
SZV outlined the measures in response to questions from 𝘛𝘩𝘦 𝘗𝘦𝘰𝘱𝘭𝘦’𝘴 𝘛𝘳𝘪𝘣𝘶𝘯𝘦 about the structural reforms needed to bring healthcare fund income and expenditures back into balance, and how the organization proposes addressing the accumulated deficit of approximately XCG 494.2 million.
The response follows a recent feature detailing how the healthcare funds managed by SZV accumulated nearly XCG 500 million in negative reserves after more than a decade in which healthcare expenditures repeatedly exceeded premium income. (click here for that feature article: https://www.thepeoplestribunesxm.com/weekend-read/how-szvs-healthcare-funds-built-up-a-nearly-500-million-deficit)
As of December 31, 2024, the Sickness Insurance Fund, ZV, Accident Insurance Fund, OV, and Government Retirees Fund, FZOG, had combined negative reserves of XCG 494.2 million. The ZV fund accounted for the largest portion, with a deficit of XCG 356.6 million. The OV fund recorded negative reserves of XCG 61.9 million, while the FZOG deficit stood at XCG 75.7 million.
The XCG 494.2 million does not represent one unpaid invoice or a single debt owed to one creditor. It reflects accumulated annual shortfalls within the three funds, with healthcare costs exceeding the premiums and other income available to finance them.
The Committee for Financial Supervision, Cft, has estimated that the funds are continuing to lose approximately XCG 30 million to XCG 35 million annually. In 2024, the three funds collected approximately XCG 117.1 million in premium income while paying XCG 148.7 million in healthcare benefits, leaving a benefit-level shortfall of approximately XCG 31.6 million.
SZV said it is continuing to collaborate on wider structural reform of St. Maarten’s healthcare financing system while implementing measures within its existing operational plans.
One of the main components is the introduction of pharmaceutical price controls intended to structurally reduce medication costs. This includes the rationalization of certain over-the-counter medications covered through the healthcare funds.
SZV is also implementing a new medical referral system designed to direct patients to facilities that provide appropriate, high-quality care at more cost-effective rates.
Medical referrals abroad have long represented a significant expense for St. Maarten’s healthcare system. By strengthening the process used to select treatment facilities, SZV aims to reduce unnecessary costs while maintaining the quality of care provided to patients.
Another major component of the strategy is improved premium compliance and collection. SZV said it is intensifying audits and has set a target of increasing premium compliance and collection by at least 3% annually.
The strategy also includes stronger fraud-prevention measures. SZV is introducing a new mobile application for healthcare providers and strengthening its internal audit team to improve oversight, verification and accountability within the system.
SZV said it is also continuing its collaboration with local healthcare providers and regional hospitals in Colombia, Curaçao and Aruba. The objective is to broaden access to medical services closer to St. Maarten and reduce the need for more expensive referrals to destinations farther abroad.
According to SZV, the measures have already been incorporated into its operational plans and are being monitored against specific performance targets.
The response identifies steps intended to slow healthcare expenditure growth and increase recurring income. It does not, however, provide a specific financial mechanism for addressing the accumulated XCG 494.2 million in negative reserves.
SZV also did not provide a projected date by which the healthcare funds could return to financial stability, nor did it identify which legislative or policy measures it considers most urgent for government to implement.
This distinction remains central to the healthcare financing debate. Cost controls, improved collections and fraud prevention could help reduce or eliminate future annual shortfalls, but stopping new losses would not automatically remove the accumulated deficit already recorded within the funds.
A separate decision would still be required on how the negative reserves should be treated over time, whether through government financing, changes to premiums and contributions, restructuring of the funds, implementation of General Health Insurance, or a combination of measures.
The People’s Tribune previously reported that the annual gap between healthcare benefit expenditures and premium income grew from approximately XCG 8.1 million in 2014 to XCG 31.6 million in 2024. Over that period, benefit expenditures increased by 93.4%, while premium income increased by 70.2%.
The figures demonstrate that the healthcare funds face two connected challenges: preventing new annual deficits and determining how to address the nearly XCG 500 million already accumulated.
