12 Feb Understanding Health Maintenance Organizations (HMOs) in the Philippines: A Guide for Businesses and Individuals
As healthcare costs continue to rise in the Philippines, Health Maintenance Organizations (HMOs) like iCare provide invaluable solutions for businesses and individuals. Whether you are an employer seeking comprehensive healthcare benefits for your workforce or an individual looking for affordable coverage, HMOs are designed to address the growing need for accessible healthcare.
This guide provides an explanation of HMOs, their benefits, and why it’s important to partner with Insurance Commission-licensed providers.
What is an HMO?
A Health Maintenance Organization (HMO) is a provider of prepaid healthcare services that allows members to access a network of hospitals, doctors, and clinics. Members pay membership fees to receive coverage for medical services without having to pay upfront. They simply present their HMO card at accredited providers, and the HMO takes care of the bill.
Key Features of HMOs
- Prepaid Healthcare: Membership fees cover access to various medical services, offering financial predictability.
- Comprehensive Coverage: Includes outpatient consultations, diagnostics, hospitalization, and preventive care.
- Cashless Transactions: Members enjoy the convenience of no out-of-pocket payments for covered services at accredited providers.
How HMOs Differ from Health Insurance and PhilHealth
1. Health Maintenance Organizations (HMOs):
• Primary Focus: Immediate and preventive healthcare, including outpatient and inpatient services.
• Payment System: Cashless access to healthcare services within the accredited network.
2. Health Insurance:
• Primary Focus: Financial protection against catastrophic illnesses or major medical expenses.
• Payment System: Lump-sum cash assistance or reimbursement, depending on the policy terms.
3. PhilHealth:
• Primary Focus: Basic healthcare coverage for all Filipinos through the government’s health insurance program.
• Payment System: Provides partial subsidy, often requiring co-payments from members.
Complementary Roles:
PhilHealth, HMOs, and health insurance are complementary and can work together to provide comprehensive healthcare coverage:
- PhilHealth serves as the foundation, offering basic healthcare services.
- HMOs provide cashless and more comprehensive coverage for routine and emergency care.
- Health Insurance adds financial security for catastrophic cases or out-of-network services.
Why Employers Choose HMOs Like iCare
For businesses, healthcare benefits are essential for attracting and retaining top talent. Rising medical inflation, which grows at 3-4 times the rate of general inflation, presents challenges in providing sustainable healthcare. HMOs like iCare are a strategic solution for companies aiming to balance employee welfare with cost management.
iCare’s Competitive Edge for Employers
1. Sustainable Membership Fees: iCare’s efficient medical loss ratio (MLR) ensures resources are allocated to member care while maintaining affordability.
2. Better Cost Management: Employers benefit from predictable and sustainable healthcare costs despite rising medical inflation.
3. Improved Workforce Retention: Comprehensive healthcare coverage enhances employee satisfaction and loyalty.
4. Cashless Convenience for Employees: Employees appreciate the seamless process of availing healthcare without worrying about upfront costs.
The Role of HMOs During the Pandemic
During the COVID-19 pandemic, HMOs played a crucial role in bridging gaps in healthcare delivery. While pandemics and epidemics are typically excluded from standard healthcare agreements, iCare set a new standard by being the first to public declare it will voluntarily cover all COVID-19-related availments on an ex gratia basis.
iCare’s Exemplary Pandemic Response
1. Proactive Coverage: Provided COVID-19 coverage for testing, consultations, and hospitalization without additional charges.
2. Support for Businesses: Helped employers ensure the health and safety of their workforce without financial strain.
3. Global Recognition: The International Finance Corporation (IFC), a member of the World Bank Group, recognized iCare for its exceptional COVID-19 response, highlighting it as a model for resilience and corporate responsibility.
This bold move reinforced iCare’s commitment to its members and showcased its ability to adapt to extraordinary circumstances.
iCare’s Legacy and Growth
Established in 1991 by the Insular Life Assurance Company, Ltd. (InLife) as its fully owned HMO subsidiary, iCare has been a trusted healthcare partner for over three decades.
In 2023, InLife entered into a strategic partnership with Value-Based Healthcare PF Pte. Ltd., a Singaporean company with a proven track record in healthcare management. iCare has since strengthened its ability to deliver innovative, efficient, and member-focused healthcare solutions.
Recognitions
- In 2023, iCare was named a Philippine Growth Champion by Statista and the Philippine Daily Inquirer, ranking among the top 25 fastest-growing companies in the country.
- In 2024, based on an Insurance Commission Report, iCare emerged as the HMO with the highest net income, underscoring its financial strength and operational excellence.
Why Regulation Matters: The Insurance Commission
The Insurance Commission (IC) ensures that HMOs operate responsibly and are financially sound. Licensed HMOs must meet stringent requirements, including:
1. Minimum Capitalization: Ensures sufficient financial resources to cover claims and obligations.
2. Medical Loss Ratio (MLR): Guarantees that a significant portion of membership fees is used for member care.
3. Acid Test Ratio: Measures the HMO’s ability to meet short-term financial obligations.
4. Reserve Funds: Mandates maintaining reserves to pay for claims, even in adverse circumstances.
A Lesson from the Past
The failure of certain financial institutions in the early 2000s, which left thousands of Filipinos without the benefits they paid for, underscores the importance of regulation. Today, the Insurance Commission enforces stricter oversight to protect consumers, ensuring that HMOs like iCare are reliable and financially stable.
Why Choose iCare?
- Affordable and Sustainable Pricing: iCare ensures that membership fees remain competitive and manageable for businesses and individuals, even in the face of rising medical inflation.
- Large Network of Providers: With over 2,000 hospitals and clinics nationwide and more than 50,000 accredited doctors and medical practitioners, iCare guarantees accessible, quality healthcare no matter where you are.
- Digital Capabilities: iCare enhances the member experience with:
- Mobile App: For easy access to plan details, benefits, and accredited providers.
- Member Association Portal: Allows employees to conveniently add their own dependents.
- HR Portal: Empowers HR teams to update employee listings efficiently.
4. Proven Track Record: Recognized globally for its resilience during the pandemic and acknowledged locally for its financial performance and growth.
Licensed HMOs in the Philippines
To safeguard your investment in healthcare, always choose an Insurance Commission-licensed HMO. The following are among the licensed HMOs in the country:
- Insular Health Care, Inc. (iCare)
- Maxicare Healthcare Corporation
- MediCard Philippines, Inc.
- PhilCare (Philippine Health Care Providers, Inc.)
- Intellicare (Asalus Corporation)
- ValuCare Health Systems, Inc.
- Cocolife Healthcare
- Avega Managed Care, Inc.
For a full list, visit the Insurance Commission’s website: www.insurance.gov.ph.
Conclusion
With its legacy, strategic partnerships, and commitment to innovation, iCare stands as a trusted partner for businesses and individuals navigating the challenges of rising healthcare costs. Backed by Singaporean expertise and recognized for its financial and operational excellence, iCare ensures accessible, affordable, and sustainable healthcare for all.
By choosing iCare, you’re not just investing in healthcare — you’re investing in a partner that that empowers you to confidently say yes to better health.
Learn More About iCare
Visit www.icare.com.ph or follow us on social media @yestoicare
Sources:
• Insurance Commission of the Philippines
• International Finance Corporation – COVID-19 Response Recognitions
• Philippine Daily Inquirer – Philippine Growth Champions 2023
• Republic Act No. 10607 (The Insurance Code of the Philippines)