The health maintenance organizations’ (HMO) net income nearly doubled in the first three months of the year owing to lower benefit and claim payments, the Insurance Commission (IC) said.
Based on the preliminary financial statements submitted to the IC, HMOs reported that the industry’s consolidated profit increased 95 percent to P1.56 billion in January to March from P797.6 million in the same period in 2020.
Insurance Commissioner Dennis B. Funa said the increase was primarily driven by the 9.2 percent decline in total expenses after HMOs’ healthcare benefits and claims dropped from P9 billion to P7.6 billion.
Meanwhile, HMOs’ total equity rose 94 percent to P15.14 billion in the first-quarter from P7.80 billion a year earlier.
“According to the unaudited reports, this increase in total equity was due to an increase in retained earnings, which comprise 77.9 percent of HMOs’ total equity,” Funa noted.
Likewise, assets of the HMOs grew 32 percent year-on-year to P66.56 billion at end-March 2021 from P50.51 billion.
Funa said the growth was due to higher “cash and cash equivalents” that accounted for 53.92 percent of the industry’s assets.
Meanwhile, the industry’s total liabilities jumped 20 percent from P42.72 billion to P51.42 billion in the first three-months.
However, HMOs’ total revenues slightly fell 2.9 percent in the first quarter to P12.79 billion from P13.17 billion due to lower membership and enrollees’ fees.
In 2015, former President Benigno S. Aquino III transferred to the IC the regulation and supervision of the HMO industry from the Department of Health.
“As the Insurance Commission has envisioned, the HMO industry has increasingly become a pillar 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 P3.98 billion in COVID-19-related claims, which constitutes 48 percent of the P8.25 billion aggregate pandemic-induced claims paid.