To the agitated sea of accusations and complaints about prepaid fees, a huge wave was added this Wednesday that when it hits the surf will cause something to be talked about: the Government's indication to some of the main private medicine entities to lower the fees to the value which would correspond if since December they had only adjusted for inflation, that is (taking into account the accumulated of January, February and March) “only” 51.54%.
Added to this decision is another piece of news, the realization of which depends on whether the Justice Department allows it: that in addition to rolling back (in practice it will be lowering the current fees), a large group of prepaid companies could be forced to
return to the affiliates
everything they Since December they have been paid above inflation adjustments.
Based on exchanges with the national government, with references of some prepaid companies covered by the measure and clarifications from other sources in the sector, below we offer a handful of responses to clarify the central points of this novelty.
1. Which prepaid companies have to lower their fees after the Government's measure?
For now, there are seven prepaid medicine entities named in the official text, a resolution of the Ministry of Commerce based on an opinion from the National Commission for the Defense of Competition (CNDC), which instructs them to recalculate the increases in their plans based on the variation in the Consumer Price Index (CPI).
Those referred to (we insist, “for now”, something that will be clarified in question 3) are Galeno, British Hospital, German Hospital, Medifé, Swiss Medical, Omint and Osde. According to the document, these companies represent 75% of the around 6 million members of prepaid medicine in the country.
2. Since when must prepaid companies “recalculate” the fees and how will the calculation be done?
The text of the Ministry of Commerce is very clear regarding the “when” of the start of this measure. It says “as of the issuance of this measure,” referring to this Wednesday, April 17. Given that the invoices corresponding to the May services have not yet been issued (they usually arrive after the 20th of each month), it follows that the “recalculation” will be applied from then on.
Rather than calling it a “recalculation”, perhaps it should be called a “reduction”. The text from the Ministry of Commerce details how large the increases of these seven entities were in recent times, especially in January and February: the first month, between 40% and 50%, when December inflation had been 25%. The second, almost 30%, although in January CPI inflation was 20.6% and in February, 13.2%.
To estimate what entities should charge in May, it is enough to take the fee paid in December and add the
51.54% accumulated in January, February and March
.
3. Will prepaid companies have to return what they overpaid between December and April?
That return is a critical issue that is on the table. It happens that, in addition to the resolution of the Ministry of Commerce, the Superintendency of Health Services decided to move forward in Justice requesting a precautionary measure for the “abuse of prices” of some prepaid companies that would have adopted a dominant position in the market.
The problem is that there are not seven (like those detailed by Commerce) but no less than
18 prepaid medicine companies
. At the closing of these lines and despite insisting numerous times, no Government source (of course, nor anyone from the Superintendency) had shared the protection filed or revealed the names of those 18 companies.
The important thing is to understand this: even though the “Super” requested the Justice that the quotas of those 18 companies be returned to “logical” values (those of December, plus the inflation of each month) and that they also be returned to The affiliates overpaid everything since the change of Government management to this part, we must wait for the judicial decision.
Everything depends on the Federal Justice in Civil and Commercial Matters No. 9 makes room for the precautionary measure. It is there where, as could be found, the case is processed.
4. Why was it decided that only a handful of prepaid companies would lower their fees and return what they were overcharging?
The resolution of the Chamber of Commerce was based on an opinion from the National Commission for the Defense of Competition, and -beyond some chicanery and accusations that came from the government leadership-, the kickoff of this novelty is the suspicion that the The increases in these months were coordinated by a group of a few companies (the seven mentioned above), which these days circulates as “cartelization.” As mentioned above, more could be added to this group, if the Justice grants the amparo appeal that targets 18 companies, among which the seven already mentioned most likely appear.
Although from a certain point of view it might seem logical that companies in a certain sector meet and share their policies, trends and future behaviors, the potential joint decision to raise prices with a certain percentage floor not only goes against the very concept of “competition”. market” but could have left members without accessible alternatives within the range of prepaid medicine options.
5. How would a potential refund of what the prepaid companies overcharged be implemented?
Clarín
spoke with some prepaid medicine companies and in general the news was perceived as a great surprise. A source from a very important company in the sector considered that “everything is confusing and no one knows how it would be implemented.”
Although some sources made it clear that they would accommodate the decision to recalculate the fees (that is, lower them according to the logic discussed above), they hinted that returning the money collected "in excess" since December would be impossible for them.
6. Is the indication to adjust prepaid medicine fees due to inflation definitive and “forever”?
As can be presumed, nothing lasts forever, much less in Argentina. Although we must wait for the judicial determination on the aforementioned protection, the text of the Ministry of Commerce makes it clear that this brake so that prepaid companies do not raise their prices beyond what inflation varies will be an interesting respite for thousands of families, but it will last like a sigh.
“This measure will be extended
for a period of six (6) months
from its notification,” the letter clarifies. Thus, it is logical to assume that a commotion similar to the one experienced this Wednesday will be revived in mid-October.
7. What happens to customers who were registered with their prepaid after December 2023?
The Commerce measure is not entirely clear in this sense and we will have to see its implementation (or, rather, the push and pull that occurs within each company with its affiliates), but it formally explains (alluding to those who contracted plans new or “low cost” that perhaps did not exist in December) that, “in the case of clients registered after December 2023, the adjustment must be made based on a plan similar to the contracted one.”
8. Many people left their prepaid plans due to excessive increases. If the new quotas close them, can they return and recover the contractual conditions they had?
This consultation was transferred to two important prepaid medicine entities and in both cases they shared that there are still
too many inaccuracies
about how the new features will be implemented. However, one of the sources shared that they would have no problem receiving the clients they lost and returning their seniority, but stressed that it would be necessary to look at the fine print of other contractual issues, such as the plans acquired at the time and the delicate issue of pre-existing diseases, which the member may have now, but not when they initially contracted the service.
In the second case, the position was more reluctant. Returning what was lost is not being considered for now.
9. What position are the entities going to take regarding the limitation placed on them by the Government and the precautionary measure?
In point 5 it was commented that some companies considered it “impossible” to return what they were overcharging. The argument they used symbolizes well the position that will surely be adopted, beyond the fact that some entities (as always happens) will be more flexible and will adapt with the members in mind and others, on the other hand, will be more insensitive and will do so reluctantly. , respecting the “minimum” indications.
10- Why do prepaid companies say that they cannot return what has already been charged?
One of the last sources consulted explained that they could not return what was charged above inflation because “those amounts were already spent to pay the providers, including sanatoriums and doctors.” And then he emphasized: “If they indicate adjusting from now on, that is one thing, but if they do it retroactively, we will melt down in two months.”
P.S.