PhilCare well on track to meeting 2013 targets

MANILA, Philippines - Despite setting stringent standards for acquiring new clients or partners, PhilhealthCare Inc. (PhilCare) has already achieved 80 percent of its target in terms of renewals, its top executive said.

PhilCare is one of the pioneers in the Philippine health maintenance organization (HMO) industry, offering multi-service health programs.

PhilCare president and chief executive officer Noemi Azura said the stringent standards were ‘by design’ in both client and partner categories to ensure reliability. That is, partners that deliver the quality service the HMO promises and the individual and corporate clients that are reliable.

“It was deliberate. We want to make sure we are acquiring the right accounts,” Azura said.

That explained the “relative” consolidation phase of the HMO in the 2012 and 2013 period.

However, PhilCare recorded gross revenues of P1.44 billion and a net profit of P26 million last year.

In the past three years, its compounded annual growth rate (CAGR) has averaged over 20 percent. In the 2010-2011 period, CAGR was 26 percent and the 2011-2012 period was 24 percent.

In comparison, the country’s HMO industry has reportedly averaged a 14-percent CAGR in the same period.

“We do not want to break that momentum,” Azura, a former Citibank retail banking specialist, said.

PhilCare, a member of the Philippine First Group of Companies, reported a persistency ratio of 90 percent in corporate accounts, and 94 percent in individual accounts. Persistency ratio generally means how much of the present clients renew their expiring contracts.

Thus, the year-to-date annual renewal revenue plan is close to 80 percent of target levels.

PhilCare is not only launching an expansion program for new clients and partners, but diversifying its services to its existing accounts.

One way of expanding the existing services it to tap into the services and client base of its affiliates in the Philippine First Group.

PhilCare is among the companies under STI Investments Inc., which include PhilPlans First Inc. and Philippine Life Financial Assurance Corp. STI Investments meanwhile is affiliated with STI Holdings, a publicly listed company, which operates STI campuses in the Philippines and manages the Philippine Womens University (PWU), Jose Abad Santos Memorial School (JASMS), and IT-oriented educational institute, iAcademy.

“That is creating synergy within the group, and the existing client base,” the PhilCare chief executive explained.

Comprehensive HMO products cover out-patient, emergency and hospitalization services, wellness, and preventive health care remain the top sellers among the company’s portfolio of products, which include “in-patient only availments,” pre-paid health cards and third-party administration.
PhilCare presently has over 200,000 individual planholders, and 1,000 corporate accounts.

It partners with 700 clinic and hospitals, aside from four of its own clinics. Affiliated doctors had ballooned to 16,000 and a 24/7 call center manned by 28 fully-licensed nurses.

Azura said that several programs are being placed onstream that will bring the HMO business to a new level.

“We are exploring new growth segments, we want to explore the blue ocean.”