Introduction

In the Philippine healthcare system, Health Maintenance Organizations (HMOs) play a significant role in providing medical coverage to millions of Filipinos. HMOs offer prepaid health plans that allow members to access services from accredited hospitals and clinics with reduced out-of-pocket expenses. However, disputes often arise regarding billing, coverage limits, and unpaid balances, leading patients to question their options for settling accounts without immediate full payment. One common inquiry is whether patients can request a promissory note—a written promise to pay a debt at a later date—when using an HMO card for hospital services. This article explores the legal, practical, and procedural aspects of this topic within the Philippine context, drawing from relevant laws, regulations, and standard practices to provide a comprehensive overview.

Legal Framework Governing HMOs and Hospital Billing

The Philippine healthcare landscape is regulated by multiple laws and agencies, ensuring patient protection while balancing the interests of healthcare providers and insurers. Key statutes and regulations relevant to HMOs and promissory notes include:

1. The Insurance Code of the Philippines (Presidential Decree No. 612, as amended)

HMOs are classified as insurance entities under the supervision of the Insurance Commission (IC). Section 187 of the Insurance Code defines HMOs as organizations that provide or arrange for the provision of health services in exchange for a fixed prepaid fee. The IC issues guidelines on HMO operations, including accreditation, coverage scopes, and dispute resolution. Notably, HMOs must adhere to fair billing practices, but the code does not explicitly address promissory notes. Instead, it emphasizes timely claims processing and member rights to appeal denials of coverage.

2. Republic Act No. 9439 (Anti-Hospital Detention Law)

This is the cornerstone legislation addressing promissory notes in hospital settings. Enacted in 2007, RA 9439 prohibits hospitals and medical clinics from detaining patients due to nonpayment of bills, provided certain conditions are met. The law states:

It is unlawful to detain patients who have fully recovered, been adequately treated, or have died solely for nonpayment of hospital bills or medical expenses.
Hospitals must allow patients to leave upon execution of a promissory note for any unpaid balance, secured by a post-dated check, guarantee letter, or an affidavit acknowledging the debt and outlining a payment plan.
Detention is only permissible if the patient refuses to execute such a note or if there are extenuating circumstances, such as ongoing treatment beyond the prescribed period.

This law applies universally to all hospital admissions, including those involving HMO coverage. It empowers patients to request a promissory note as an alternative to immediate payment, preventing undue hardship or illegal detention.

3. Department of Health (DOH) Administrative Orders and Guidelines

The DOH, through orders like DOH Administrative Order No. 2016-0032 (Guidelines on the Implementation of RA 9439), provides procedural details for hospitals. These include:

Mandatory posting of patient rights in visible areas.
Standardized forms for promissory notes, which must include the amount owed, payment terms, and signatures from the patient or their representative.
Coordination with third-party payers like HMOs to verify coverage before billing patients.

Additionally, DOH Circular No. 2017-0015 reinforces integration with the National Health Insurance Program (PhilHealth), which often complements HMO coverage, ensuring that promissory notes account for deductions from both sources.

4. Republic Act No. 10606 (National Health Insurance Act of 2013)

While primarily focused on PhilHealth, this act intersects with HMOs as many plans are supplementary to universal health coverage. It mandates that hospitals deduct PhilHealth benefits first, followed by HMO contributions, before billing patients. Unpaid patient shares can be settled via promissory notes under RA 9439.

5. Consumer Protection Laws

The Consumer Act of the Philippines (RA 7394) and the Magna Carta for Patients (proposed but influenced by existing DOH policies) emphasize fair treatment, transparency in billing, and the right to dispute charges. Patients can invoke these to negotiate promissory notes if HMO denials lead to unexpected costs.

How HMOs Operate in Hospital Settings

HMOs contract with hospitals to provide services to members. The process typically involves:

Pre-Admission and Admission Procedures

HMO Card Presentation: Upon admission, patients present their HMO card, triggering coordination between the hospital's billing department and the HMO for approval (often via a Letter of Authorization or LOA).
Coverage Verification: The HMO assesses eligibility, coverage limits (e.g., annual benefit limits, room and board caps), exclusions (e.g., pre-existing conditions, non-accredited procedures), and co-payments (patient's share, usually 10-20% of the bill).
Billing Breakdown: Hospitals issue itemized bills showing HMO-covered amounts, PhilHealth deductions (if applicable), and the patient's responsibility.

Common Scenarios Leading to Promissory Note Requests

Partial Coverage: If the HMO denies full coverage (e.g., due to exceeded limits or non-covered items like certain diagnostics), the patient faces a balance.
Emergency Admissions: In urgent cases, treatment proceeds without prior HMO approval, leading to retrospective claims. Disputes may arise if approval is partial.
Out-of-Pocket Expenses: Co-pays, deductibles, or charges for upgraded services (e.g., private rooms beyond HMO allowance) must be settled.
Discharge Delays: Patients ready for discharge but unable to pay immediately may request a promissory note to avoid detention.

In all these cases, RA 9439 allows patients to request a promissory note for the unpaid portion, even if the bulk is HMO-covered.

Patient Rights and Obligations

Patients using HMO cards have specific rights under Philippine law:

Rights

Right to Discharge Without Detention: As per RA 9439, no hospital can hold a patient hostage to unpaid bills if a promissory note is signed.
Right to Itemized Billing: Hospitals must provide detailed breakdowns, allowing patients to verify HMO contributions.
Right to Appeal HMO Decisions: Members can appeal coverage denials through the HMO's internal grievance process or escalate to the IC.
Right to Privacy and Dignity: Promissory note negotiations must be handled confidentially, without coercion.
Integration with PhilHealth: Patients can insist on PhilHealth deductions before any promissory note is calculated.

Obligations

Timely Notification: Patients must inform the HMO of admission within 24-48 hours (per HMO policy) to avoid claim denials.
Payment of Co-Pays: Even with a promissory note, patients remain liable for their share.
Compliance with Terms: Failure to honor the promissory note can lead to legal action, including collection suits or credit reporting.
Documentation: Patients should retain copies of the HMO LOA, hospital bills, and promissory notes for potential disputes.

Procedures for Requesting a Promissory Note

The process is straightforward but requires awareness:

Assess the Bill: Upon receiving the final bill, review for accuracy, ensuring HMO and PhilHealth deductions are applied.
Request Negotiation: Approach the hospital's billing or patient relations office to discuss the unpaid balance.
Invoke RA 9439: Explicitly reference the Anti-Hospital Detention Law to request a promissory note.
Execute the Document: The note should specify:
- Total amount owed.
- Payment schedule (e.g., installments over 3-6 months).
- Collateral (optional, like post-dated checks).
- Signatures and witnesses.
Secure Discharge: Once signed, the hospital must release the patient immediately.
Follow-Up with HMO: If the balance stems from a denial, appeal to the HMO for reimbursement, which could offset the note.

Hospitals accredited by HMOs often have streamlined processes, as they risk losing accreditation if they violate patient rights.

Challenges and Practical Considerations

Despite legal protections, challenges persist:

Hospital Resistance: Some facilities may pressure for cash payment, citing administrative burdens of promissory notes. Patients can report violations to the DOH or IC.
HMO Delays: Slow claim processing can inflate patient shares temporarily, necessitating promissory notes.
Indigent Patients: For low-income individuals, programs like the Medical Assistance Program (MAP) under the Department of Social Welfare and Development (DSWD) can cover balances, reducing reliance on notes.
Legal Recourse: If detained unlawfully, patients can file complaints with the DOH (fines up to PHP 500,000) or pursue civil damages.
COVID-19 and Recent Developments: Post-pandemic guidelines (e.g., DOH Memorandum 2020-0185) emphasized flexible billing, including extended promissory terms for HMO-related delays, though these have largely expired by 2026.

In practice, urban hospitals in Metro Manila and major cities are more compliant, while rural facilities may vary.

Case Examples (Hypothetical Based on Common Scenarios)

Elective Surgery Case: A patient undergoes appendectomy using an HMO card. The HMO covers 80%, but a PHP 20,000 co-pay remains. Unable to pay immediately, the patient signs a promissory note for monthly installments, allowing same-day discharge.
Emergency Denial Dispute: In a heart attack case, the HMO initially denies coverage for a non-accredited stent. The patient requests a promissory note for the full bill minus PhilHealth, appeals the denial, and later receives HMO reimbursement to settle the note.
Maternity Admission: A delivery exceeds HMO maternity limits. The hospital accepts a promissory note secured by a guarantee from the patient's employer.

These illustrate how promissory notes bridge gaps in HMO coverage.

Conclusion

Patients in the Philippines can indeed request a promissory note when using an HMO card in hospitals, primarily under RA 9439, which safeguards against detention for nonpayment. This option ensures access to healthcare without immediate financial strain, while holding patients accountable for their obligations. However, success depends on understanding HMO policies, invoking rights promptly, and maintaining documentation. For complex cases, consulting legal aid or the IC is advisable. As the healthcare system evolves with universal health coverage expansions, such mechanisms remain vital for equitable patient care.