Uncertainty is rising around the direction of private health insurers in Chile.
This 2023 may be the “beginning of the most difficult year in history” for the entities, said the president of the Isapres Association, Gonzalo Simon, in an interview with a local media outlet.
For more than a year, health insurers have been reflecting losses in their financial statements.
In the first nine months of 2022 alone, they lost US$150 million, according to data from the Superintendence of Health.
But the turning point was a Supreme Court ruling, issued on November 30, which annulled the increase in the Isapres, ordered the application of the table of factors defined by the Superintendence of Health in December 2019 to all its affiliates and refund excess charges.
This week, the insurers issued a statement asking the supervisory body to speed up how this verdict will be applied.
NEAR OR FAR FROM A COLLAPSE?
For the economist Jorge Berríos, an academic at the Faculty of Economics and Business of the University of Chile, from the operational and cash flow point of view, the Cruz Blanca and Consalud isapres are in “technical bankruptcy.”
Cruz Blanca, linked to the British United Provident Association (Bupa), recently informed an associated clinic, Indisa, that they are not in a “condition to comply with the contract signed between the parties” that established an annual readjustment in accordance with the CPI in prices of attentions since January 9.
Since last year Bupa and the international health insurer UnitedHealth Group have been preparing to confront the Chilean government after a series of new regulations and court rulings were already pushing the Isapres towards a possible collapse.
An eventual decline of the system, which has more than 3 million members, causes concern.
Berríos indicates that the possibility of insolvency of a strategic sector would be a bad sign not only at the national level, but also for foreign investors.
But the greatest concern lies in a collapse of the organization, which would also have repercussions on the public system because it would have to receive a greater number of users.
“We are working on a proposal to strengthen public insurance, so that any eventuality that occurs with the Isapres, people do not feel unprotected,” Health Minister Ximena Aguilera said in an interview with Duna radio this week.
WAITING FOR THE SUPERINTENDENT
Berríos assures that Consalud would be in a more complex situation than Cruz Blanca. The economist considers that there should be greater transparency regarding the current financial situation of insurers and the origin of their losses.
There are endless reasons to speculate about the root of the million-dollar losses of the entities, adds the academic.
These could go from costs generated during the pandemic such as absorbing expenses and covering the fees of the people served by the public servant Fonasa, payment of medical licenses and even the costs of lawsuits due to the increase in health plans.
At the moment, Minister Aguilera said that they will not be put on any stage until they have all the analyzes completed by the Superintendence.
“It is not very appropriate or safe for people to get into speculation,” she said at a press conference.
For its part, the Health Superintendence called for prudence to comply with the Supreme Court ruling and stated that they have no intention of harming insurers.
“Is there a sense of urgency? There is, but the same responsibility indicates that we are going to occupy more time than perhaps the Isapres would like, but less than the Court has given us”.
With information from Bloomberg