HMO profit nearly doubled in first quarter – Manila Bulletin

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The net income of health maintenance organizations (HMOs) nearly doubled in the first three months of the year due to declining benefits and claim payments, the Insurance Commission (IC) said.

Based on the preliminary financial statements submitted to the IC, the HMOs reported that the industry’s consolidated profit rose 95% to 1.56 billion pesos from January to March, from 797.6 million pesos during the same period in 2020.

IC Comm. Dennis B. Funa

Insurance commissioner Dennis B. Funa said the increase was mainly due to the 9.2 percent drop in total spending after HMO health care benefits and claims fell from 9 billion pesos to 7.6 billion pesos.

Meanwhile, HMOs’ total equity rose 94% to 15.14 billion pesos in the first quarter, from 7.80 billion pesos a year earlier.

“According to unaudited reports, this increase in total equity was due to an increase in retained earnings, which represents 77.9% of total HMO equity,” noted Funa.

Likewise, HMOs assets grew 32 percent year-on-year to reach 66.56 billion pesos at the end of March 2021, from 50.51 billion pesos.

Funa said the growth was due to higher “cash and cash equivalents” which represented 53.92% of the industry’s assets.

Meanwhile, the industry’s total liabilities jumped 20%, from 42.72 billion pesos to 51.42 billion pesos in the first three months.

However, total HMO revenues edged down 2.9% in the first quarter to 12.79 billion pesos from 13.17 billion pesos due to lower membership and enrollment fees.

In 2015, former President Benigno S. Aquino III transferred the regulation and supervision of the HMO industry from the Ministry of Health to the CI.

“As envisioned by the Insurance Commission, the HMO industry has increasingly become a mainstay of the Philippine economy serving our fellow Filipinos, especially during the pandemic,” Funa said.

Since the start of the COVID-19 crisis, HMOs have paid 3.98 billion pesos in COVID-19-related claims, which is 48% of the aggregate 8.25 billion pesos in pandemic-induced claims.


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