The local Health Maintenance Organization (HMO) industry composed of 29 major players has reported total net income P1.65 billion for 2018, representing a 63-percent jump compared to the P1.01 billion recorded in 2017, according to the Insurance Commission (IC).
In a news statement issued on Tuesday, Insurance Commissioner Dennis B. Funa attributed the growth to the increase in revenues for the year primarily from the payment of membership fees.
The IC pointed out that Medicard Philippines Inc. reported the highest net income amounting to P706.31 million for the year.
Total revenue generated by the industry also posted a growth of 15 percent for the year amounting to P45.30 billion coming from P39.32 billion in 2017.
In terms of revenue, Maxicare HealthCare Corp. (Maxicare) took the lead with a reported revenue of P14.18 billion.
Funa explained that 96 percent, or P43.57 billion of the total revenues of the HMO industry, were generated from fees paid by its members in exchange for the assumption of the risk funding members’ health-care services and related administrative costs.
The HMO industry, likewise, recorded an increase in the total membership fees paid in 2018 amounting to a total of P43.502 billion.
“The total membership fees paid in 2018 is 14 percent higher than the P38.16 billion membership fees collected in 2017,” Funa said.
With a market share of 32 percent, Maxicare reported the highest membership fees collected in the amount of P13.84 billion.
In terms of assets, this amounted to P38.96 billion for 2018, up by 18 percent from P32.91 billion recorded in 2017.
Maxicare also took the top spot in terms of assets with reported assets amounting to P9.89 billion for the year.
Meanwhile, the IC said that it is currently finalizing the Standard Chart of Account (SCA) for HMOs which will serve as the financial reporting framework for HMO to ensure transparency in their financial conditions and the consistent application of existing regulations.
Funa pointed out that the SCA will also provide a logical framework in the determination of the allocation and use of funds of HMOs in compliance with the rules and regulations promulgated by the IC.
Furthermore, he said that the IC will also be implementing additional reporting requirements for HMO companies, with the additional data being valuable in terms of understanding the role of HMOs and their effect on the market for health services.
“In order for the Commission to have a complete picture of the HMO industry, HMO companies are now required to submit comparable data relating to enrollment of members. Specifically, HMOs are now required to provide data on the number of clients, policies, members, principals and dependents,” he added.
Funa also mentioned that the IC is currently drafting a regulation which seeks to require HMOs to establish and maintain a claims register which shall contain details of all claims made under HMO contracts.