Deadline Extended for Muface Healthcare Contract Bids Amid Insurer Withdrawals
The Ministry of Public Administration announced on Friday a significant extension of the deadline for insurers to submit their bids to provide healthcare services under the Muface contract, now due on January 27. This decision was made to accommodate the ordinary bidding period which was set to expire on January 15, coinciding dangerously with the holiday season filled with non-working days. This timing created concerns regarding the complexity of the bidding process, prompting the ministry to act accordingly.
Sources from the ministry clarified that this announcement has already been published on the public sector contracting platform, indicating the government's effort to ensure a smooth bidding process given the circumstances. Currently, Asisa remains as the only candidate, a surprising turn of events as three major insurers have previously opted out of the bidding.
In recent developments, DKV has officially declared its withdrawal from the Muface contract. This decision came after the company, along with SegurCaixa and Adeslas, expressed that they could not accept the proposed 335% increase in premiums set forth by the government, deeming it inadequate. Their refusals echo a similar criticism of the initial bidding that resulted in no bids being placed at all back in November, marking an unprecedented occurrence in the history of Muface contracts.
SegurCaixa voiced its dire concern, revealing that continuing on the Muface model could lead to loses upwards of 250 million euros, similar to the losses incurred during the current contract period that expired on December 31. This prompted the government to extend the contract for an additional three months while exploring solutions.
DKV further added depth to these troubles, stating that it would not provide services to national mutualists for the first time since the establishment of mutual funds. They reported losses exceeding 70 million euros before taxes from the last agreement, predicting that continued service under the current terms could amplify losses to between 70 million and 100 million euros. The recurring theme among these insurers has put a stark spotlight on the Muface model's funding, which they describe as insufficient and, ultimately, unsustainable in its present form.
In a separate but related thread, both DKV and Allianz Partners are contemplating the Muface Internacional opportunity, which caters to over 8,000 officials stationed abroad. Both companies are currently reviewing the contract documents related to this international service, signaling a divergence in their strategic focus compared to the national contract. However, they remain cautious, as the terms of the international contract do not meet their specified demands that included a 30-35% premium increase and a one-year contract duration.
Despite these challenges, DKV has expressed optimism about pursuing an agreement with Muface, provided that there is adequate coverage for costs associated with the services they offer. The ongoing situation highlights the complexities and pressing issues within the healthcare insurance market for public officials and reflects broader conversations about the sustainability of public healthcare models in Spain.
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