by Robert Yota
Publicly listed Hospital chain PT Mitra Keluarga Karyasehat (MIKA) recorded a positive performance in the first quarter of 2020, showcasing year-on-year (YoY) revenue and net income growths. During 1Q, MIKA’s revenue was booked at Rp 875 billion, increased by 8.7%. Of the total revenue, inpatient grew by 9.6% from Rp 502 billion to Rp 551 billion, while outpatient grew by 7.2% from Rp 302 billion to Rp 324 billion.
The rise in revenue is mainly attributed to the new demand for COVID-19 treatments. Within the period, 16 out of 24 MIKA hospitals have been appointed by the government to serve COVID-19 patients with up to 350 beds dedicated to treating such patients. At the end of March, more than 600 cases have been treated at the hospitals. Meanwhile, MIKA’s net income also enjoyed an increase of 7.4% (YoY) from Rp 205 billion in 2019 1Q to Rp 220 billion.
The Ministry of Health (Kemenkes) recently issued Decree 238/2020 in April which provisions the Ministry of Health to reimburse COVID-19 treatment costs to hospitals after claim submissions every 14 days, with a 50% down payment to be paid within the first seven days. The remainder to be paid after verification by state healthcare provider BPJS. Since the decree was announced, MIKA has begun submitting claims to BPJS with the down payments received on schedule.
According to Bahana Sekuritas recent research, MIKA’s targets for 2020 are achievable given the timely cash flow from COVID-19 treatments, bottoming outpatient traffic supported with manageable occupancy rates. However, there are several downside risks in the foreseeable future, such as reimbursement delays for COVID-19 treatment costs incurred by MIKA from the Ministry of Health.
This year, MIKA has allocated Rp300 billion of capex, which will be used to build hospitals. The amount decreased by 51.61% compared to 2019 of Rp 620 billion.