Colombia to Pay US$215 Million to Health Insurers

Colombia will pay US$ 215 million to private health insurance companies. This is 820,000 million Colombian pesos, the amount owed by the State to these companies, which have been in deficit since last year for high-cost medical treatments. This has been announced by the Ministry of Health, which has confirmed that these payments will add to the country’s national debt.

The private insurers, known in Colombia as Health Promoting Companies, had been warning for months that their financial difficulties were jeopardizing the viability of providing services to users.

This situation comes just at a time when Congress has approved giving a greater role to public management of these funds, minimizing private management.

A year of ideological struggle

Insurers have spent the past year complaining about delays in payments that jeopardized the service. For its part, President Petro’s government gave repeated assurances that it was scrupulously complying with its financial obligations.

The differences, essentially, were in some discrepancies in the payments for pharmaceutical expenses under the previous government, as well as in the deficits of high-cost treatments, which with today’s determination should be resolved.

What all this shows is that this scenario is part of the heated political debate that the country is going through, between two opposing conceptions on the management of public money and the role of the State and private companies in the provision of essential services, such as health.

Ensuring service delivery

In this sense, 2023 has been a difficult year for private health insurers. Delays in payments from the State and the threat of a reform of the sector that aims to prioritize public management, at the expense of the role of these companies, have added pressure to an already complex group. It should be remembered that in Colombia, health care is mainly paid for by the State, which transfers significant amounts of money to private companies that act as intermediaries between the payer, the State, and the hospitals and health centers that treat patients.

This system has been in place in Colombia for 30 years and has never been free of controversy, as bankruptcies and embezzlement by these private companies have been frequent. Complaints from users about malpractice or delays in the supply of medicines have also been common. However, at the political level, the debate is more ideological than functional: the left-wing government is working for the management of public money to be in public hands. In this sense, and overcoming all kinds of difficulties, the reform is overcoming hurdles and is on the way to its final approval. For its part, the conservative opposition accepts reforms, but maintaining the current practice of offering management to private companies.

A guarantee system

For its part, the citizenry is watching the political debate expectantly, with more skepticism than enthusiasm. The health care system in Colombia, with all its drawbacks, is one of the most guaranteed in the continent. The Constitution obliges health care managers to provide medical care, even to people who do not have the economic resources to pay for insurance.

Through the System for the Identification of Potential Beneficiaries of Social Programs (SISBEN), the population is classified according to their living conditions and income. This classification is used to focus social investment and ensure that it is allocated to those who need it most, guaranteeing medical care.

Any person may request the application of the survey and thus be registered in the SISBEN database. In order to apply for the survey, it is necessary to comply with the established conditions such as: residing in a private household and having valid and current documents.

Challenges for 2024

The main challenge for the sector for the year 2024, following the processing and final approval of the reform, will be its satisfactory implementation, which the government has foreseen within two years. During this time, the insurers that wish to continue will have to change their role, abandoning the one they have had up to now as intermediaries.

In fact, they will change their name to Entidades Gestoras de Salud y Vida, and will have functions such as audits and the management of Primary Care Centers (CAP), the first link in the health chain for the citizen, with the change of model.

In this sense, the insurers will lose the central role they have played up to now, but the new scenario also reserves for them an important task: to be the first step in the screening of diseases and the referral of patients to one area or another, as determined in each case.

Likewise, the government expects that these changes will improve the management of public money, strengthening the inspection and surveillance system.