HMO providers given one more month to meet IC requirement
The Insurance Commission has given companies providing health maintenance organization (HMO) services one more month to ensure that they do not sell non-HMO and preneed-like products before they are slapped penalties for non-compliance.
“The deadline for submission of HMO products and corresponding agreements and contract forms to the Insurance Commission for approval shall be extended from March 31 to April 30, 2018. Thereafter, no HMO product shall be sold unless said product and its agreement and contract forms have been approved by the Insurance Commission,” Insurance Commissioner Dennis B. Funa said in Circular Letter No. 2018-20 issued on March 27.
“However, HMOs that have submitted their products and corresponding agreements and contract forms within the April 30 deadline shall be allowed to sell their existing products until June 30,” Funa added.
According to Funa, the extension was made “in consideration of the request of the associations of HMOs and to give the Insurance Commission more time to evaluate and approve HMO products and corresponding agreements and contract forms without disadvantaging HMOs.”
In September last year, Funa ordered these companies to submit a copy of the HMO agreements for all the HMO products they were selling.
Early this year, Funa said the regulator was pushing for stricter regulation of HMOs through a law ensuring that consumers would be better protected.
For Funa, “legislation would be the best course that we can take” to better regulate HMOs, similar to the move to institutionalize a Pre-Need Code for the troubled sector years back.
Funa had admitted that existing regulations covering HMOs had loopholes and were limited to the executive order (EO) issued by former President Benigno Aquino III that transferred regulatory oversight to the Insurance Commission from the Department of Health, as well as a number of circulars it had issued in the past two years.
In 2016, the IC issued rules under which new domestic and foreign HMO entrants must comply with a P100-million paid-up capitalization requirement, while keeping the P10-million minimum for existing players.
As of mid-2017, 25 HMOs have certificates of authority for license years 2017-2019.
