October 30, 2018 / 11:49 AM / 17 days ago

Indonesia plans review to decide on further bailout for state-owned insurer

JAKARTA, Oct 30 (Reuters) - Indonesia’s finance ministry is conducting its second review this year of state health insurer BPJS Kesehatan’s finances after the company requested additional cash to meet its liabilities, a ministry official said on Tuesday.

The world’s fourth most populous country introduced universal health coverage in 2014, but BPJS Kesehatan has consistently operated in the red, with claims paid out far exceeding premiums collected.

BPJS Kesehatan, which provides cover for nearly 200 million Indonesians, has to repay a total of 7.2 trillion rupiah ($472.60 million) of debts that have matured or will mature this week and on Monday had only 154 billion rupiah, the head of the company Fahmi Idris was quoted as saying in media reports.

An assistant to the finance minister told reporters that the ministry would perform a full review to determine the insurance company’s prospects through to December before deciding on what measures are required.

BPJS Kesehatan has already requested a 16.5 trillion rupiah government bailout this year after a ballooning balance sheet deficit left hospitals and pharmaceuticals companies complaining of unpaid bills.

In September the government injected 4.9 trillion rupiah in capital after reviewing the insurer’s finances, but Idris told a parliamentary hearing late on Monday that all the money had been spent by the end of that month.

Some hospitals have complained of delayed payments from BPJS hurting their cashflow and their relationship with pharmaceutical distributors.

There are at least two other insurers in Indonesia with financial problems.

Life insurer Bumiputera remains under the control of the Financial Services Authority (FSA) after a rescue plan involving a private investor fell through in March.

The FSA this month said it was monitoring state-owned insurer Jiwasraya, which is battling a liquidity problem and has had to delay payments for matured policies. ($1 = 15,235.0000 rupiah) (Reporting by Maikel Jefriando and Gayatri Suroyo Editing by David Goodman)

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