Colombian Health Insurance Giant in Crisis Due to Non-payment

The Colombian health insurance company Sanitas is in crisis. The latest episode in a series of economic and management problems has come with the notice given by the drugstore chain Cruz Verde, responsible for supplying medication to the health insurer patients. The pharmacy chain is demanding a payment of 400 billion pesos from Sanitas for medications and other supplies.

Cruz Verde has announced that starting on November 15, they will suspend the delivery of medications that are not included in the Basic Health Plan (PBS). The pharmacy has explained that, due to the significant amount owed to them by the insurer, it is not possible to continue providing medication to the users.

This new crisis further exacerbates the problems in the already struggling healthcare service of the Colombian health insurer. The government is trying to reform the system through a new healthcare law, but so far, it has not garnered sufficient political support.

Over 3 Years of Non-Payment

“After more than three years of negotiations and various requests made to health insurance company Sanitas to generate a payment for the outstanding debt, the debt has not been settled. Cruz Verde has not received a payment plan from this health insurance company, and, at the same time, the insurer has failed to uphold the agreements to which it had committed,” states Cruz Verde’s statement.

In their report, the pharmaceutical company claims that the decision was made “after exhausting multiple and extensive approaches” to settle the outstanding debt from Sanitas. This situation hinders them from continuing to supply not only non-PBS medications but also supplies and technologies, especially of an ambulatory nature.

Sanitas has already received the notice and any future decisions regarding their business relationship with Cruz Verde and the maintenance of medication supplies to users will depend on the insurer. The pharmacy chain has clarified that this situation only affects Sanitas’ affiliates; dealings with patients from other health insurance companies will continue as normal.

Sanitas’ Response

Sanitas, the insurance provider, has issued a statement, saying, “Since we received the unilateral and abrupt notification from Cruz Verde, we have been seeking alternatives and activating contingency plans to minimize the impact on the dispensation of non-PBS medications to the greatest extent possible.”

The company claims to be working on a strategic plan to ensure the normal supply of medications to their affiliates, but they do not specify how this will be carried out or what payment guarantees they will offer to Cruz Verde, considering that the pharmaceutical company’s deadline is only two weeks away.

Likewise, the health insurance company has blamed the government for the situation due to the significant debt it holds with them. “Unfortunately, the issue of Maximum Budgets related to this decision is one of the reasons we have been warning the government for months about the importance of finding solutions to the current situation without receiving a response,” the statement concludes.

Opposition Blames the Government

According to the pharmaceutical company, the Colombian government also shares responsibility for the situation. However, the most severe accusations have come from opposition politicians, blaming the current administration for payment delays to health insurance companies, which have led to these accumulated debts with drugstores.

In this regard, Andrés Forero of the conservative Democratic Center directly holds President Petro’s government responsible for the crisis, as a result of delays in transferring maximum budget payments: monthly allocations for 2023 and 2022 adjustments. “Grave. Cruz Verde announces that it will no longer supply non-PBS medications to Sanitas. This is due to the government’s delays in maximum budget payments: monthly allocations for 2023 and 2022 adjustments. The crisis is advancing at the expense of patients,” the opposition congressman denounces.

Cathy Juvinao, a representative to the House from the Green Alliance party, also blames the government for the situation. According to the Green Party representative, the government is causing the bankruptcy of the EPS sector to justify its healthcare reform “for ideological reasons.”

“Oh my God. The government seems willing to create a crisis at the expense of lives, all to validate its absurd healthcare reform ideologically. I ask my colleagues in the @CamaraColombia to understand the level of danger that is brewing,” the Green Alliance party legislator said.

Healthcare Reform – Second Parliamentary Debate

This situation comes just hours before the controversial healthcare reform’s second parliamentary debate, which was suspended two weeks ago, is set to resume on November 1. Over half of the articles are still pending debate.

While 49% of the text was approved in previous discussions, the most challenging debates remain due to a lack of consensus among different political forces. Up to this point, the plenary has approved 70 out of the 143 points in the legislation.

One of the aspects that generates the most controversy among lawmakers is the transformation of health insurance companies into mere health and life managers. The government aims to give a leading role to public health management, surpassing the health insurance company system that has prevailed in Colombia until now. This point, of those set for discussion in November, is likely to be the most contentious.