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Business

Millennials banked on to spur HMO recovery

Louise Maureen Simeon - The Philippine Star

MANILA, Philippines — The Generation Y, colloquially known as the millennials, is expected to help prop up the health maintenance organization (HMO) sector into recovery as health protection tops their priority list.

Results of the latest Wellness Index Survey of HMO provider Philhealth Care Inc. (PhilCare) showed that millennials, or those aged 27 to 42, put health benefits on top of their work priority list.

PhilCare president and CEO Jaeger Tanco said the younger generation could significantly contribute to the sector’s recovery especially as they account for about 40 percent of the country’s workforce.

The survey showed that health benefits such as HMO and insurance topped millennials’ work priorities. This is followed by job satisfaction, monetary benefits, and ease of travel.

“Right now, there is more utilization from the older generation, but there are also more millennials and even Gen Zs that are coming in which could balance it out,” Tanco said.

“The younger ones are more conscious now especially because they experienced what happened during the pandemic. They know the importance of helathcare,” he said.

During the nine-month period of 2023, the HMO industry incurred a net loss of P2.15 billion due to higher benefits and claims, which rose by 20 percent to P40.92 billion.

Total assets handled by HMOs increased by 14 percent to P64.07 billion while total invested assets inched up seven percent to P17.14 billion. Liabilities, likewise, rose by 21 percent to P53.66 billion.

Tanco said that for 2024, there would still be high utilization for the first couple of months as HMO holders catch up on their medical needs after the holiday season.

Further, Philcare wellness index lead researcher and University of the Philippines College of Mass Communication dean Fernando Paragas said millennials and even the Gen X have a strong preference for entrepreneurship over the security of traditional employment.

About 53 percent of the respondents said they would rather start their own business than remain as an employee.

“The shift in their mindset signals a departure from the traditional nine-to-five structure, with both generations seeking greater control over their schedules,” Paragas said.

“This demand for flexibility underscores the importance of prioritizing health, well-being, and work-life balance. Any business or organization that wants to win the war for talent should create a flexible work arrangement top of mind,” he said.

The PhilCare survey covered 61 percent female and 39 percent male, all of whom are employed. About 67.5 percent belong to lower-income households.

As of end-September 2023, PhilCare ranked fourth in the HMO sector in terms of assets at P4.32 billion. Its net income stood at P57.17 million during the period.

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