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Frequently Asked Questions on the Termination of the Family Hospitalization Plus Plan and Hospitalization Insurance Plan of the GSIS

What is the Family Hospitalization Plus Plan (FHPP) and the Hospitalization Insurance Plan (HIP) of the Government Service Insurance System (GSIS)?

The FHPP and HIP are term insurance products of the GSIS that offer medical benefits in case of hospitalization due to sickness or injury. These hospitalization insurance packages are among the preneed products that were introduced and marketed by the GSIS more than 10 years ago.

Similar to the Philippine Health Insurance Corporation (PhilHealth) plan, FHPP and HIP cover future services, particularly payment of medical expenses, at the time of actual need. Like the PhilHealth hospitalization policy, the payment of monthly premium is indispensable to ensure continuous coverage under the FHPP and HIP.

Why did the GSIS terminate the FHPP and HIP?

As the administrator of social insurance for government workers, the GSIS is primarily mandated to provide defined benefits to members, especially when they retire from the service and can no longer earn for themselves or their families. It also insures its members in the event of certain contingencies, such as sickness, disability, or death.

Consistent with its mandate, the GSIS management reviewed its optional and preneed products. The review sought to assess if these products continue to supplement the subscribing members’ insurance needs.

The review showed that the private insurance industry, as well as the government-managed PhilHealth, have developed over the years better benefits and servicing capacity for hospitalization insurance at a cost of higher premium (rates). It was also found out that since the premium rates of its hospitalization insurance packages were kept in modest amounts, the GSIS has retained the same set of benefits it had offered 10 years ago.

After evaluating the responsiveness of the FHPP and HIP, the GSIS management has acknowledged that PhilHealth has the mandate to provide all Filipinos with accessible, available, acceptable, and affordable health care services. It can therefore institute the GSIS hospitalization programs more effectively, as it also has the right number of people to manage these insurance accounts.

Alongside the review and in preparation for the termination of the programs, the GSIS undertook a massive cleansing of its FHPP and HIP accounts to determine how many policies have payments and how many have lapsed.

What is the effectivity date of the FHPP and HIP termination?

Effective 1 January 2013, the GSIS has terminated the implementation of the HIP and FHPP. Hence, policies that were active as of 31 December 2012 will no longer be renewed and premium payments for those policies will not be accepted.

What is the effect of the termination to all active FHPP and HIP accounts?

The termination means that policyholders with active plans are covered only until 31 December 2012 subject to the payment of corresponding premiums.

For policies that will remain in force until 31 December 2012, the GSIS will accept and process claims as long as they are filed within 60 calendar days from the last day of confinement, as stipulated in the policy contracts. The GSIS shall accept and process claims covered by the FHPP and HIP policies until 30 June 2013 only.

Have the member-policyholders’ agencies been informed of the FHPP and HIP termination? What will happen to the premiums that their agency will remit?

Yes, all authorized agency officers were duly informed of the FHPP and HIP termination as early as October 2012. As mentioned above, no premium payments will be accepted after 31 December 2012.

Will the GSIS refund premiums that policyholders have paid?

Since the payment of monthly premiums is necessary to be covered for the corresponding month, the failure of policyholders to use or avail of the medical services under the plan on a particular month or period – when they actually should – does not entitle them to refund premiums they have paid.

FHPP premiums, however, may be refunded only if all of the following conditions are strictly met:

  • Payment of premiums is continuous. This means that the policy is not lapsed or there are no unpaid premiums. (It must be underscored that FHPP contracts provide for automatic lapsation of policy in case of nonpayment of even a single or one-month premium.)
  • No claim was made on the FHPP plan in any period within 10 years.
  • The policyholder is not above age 59.

For HIP policyholders, there is no such provision for refund of premiums.