HMOs finally swing to profit in Q1

MANILA, Philippines — The health maintenance organization (HMO) industry reverted to profitability in the first quarter after almost two years of losses as membership fees increased.

Latest data from the Insurance Commission showed that the sector’s net income reached P6.8 million in January to March as against a net loss of P319 million in the same period last year.

This is the first time the HMO sector recorded a profit since the second quarter of 2022.

For the January to March period, revenues jumped by 20 percent to P18.68 billion as the industry increased its membership fees to reach P17.77 billion, up by 17 percent.

This comprised 95 percent of the sector’s total revenues.

The higher membership fees managed to offset the higher benefits and claims released by 24 HMO firms covered in the report, which went up by 17 percent to P15.05 billion from P12.83 billion in 2023.

The total assets handled by HMOs grew by 10 percent to P71.31 billion, while total invested assets inched up by four percent to P18.49 billion.

Liabilities, however, also increased by 16 percent to P61.49 billion attributed to the 16 percent hike in membership fee reserves and the 52 percent jump in claims reserves.

HMO equity declined by 17 percent to P9.82 billion as retained earnings plunged by 85 percent or P5.31 billion.

On the other hand, the industry’s total capital stock soared by 44 percent to P8.14 billion.