Grupo Sura's Health Unit Dismantling Adds Strain to Colombia's System

Grupo Sura has requested regulatory approval to dismantle its health business, further impacting Colombia's fragile healthcare system. This follows the government's recent takeover of two major insurers and the rejection of President Petro's proposed health reform, highlighting systemic financial challenges within the sector.

A subsidiary of Colombian conglomerate Grupo Sura said on Tuesday it has asked for regulatory permission to dismantle its health business, in the latest blow to Colombia's healthcare system. The government of President Gustavo Petro last month took control of two major insurers - Sanitas and Nueva EPS, which had some 16 million clients combined - alleging they failed to provide adequate care.

A senate committee rejected a health reform proposed in April by Petro, who has struggled to push new laws for his cornerstone promises through the Andean country's Congress. "The senate sank the proposal, and as I've said for more than a year, by sinking the reform there's the domino effect of bankrupting health service providers," Petro said in a post on X.

The SURA unit, EPS Sura, reported net losses of 360 billion pesos ($92.3 million) from 2022 to 2023, depleting the company's assets. "Considering the current financial conditions of the healthcare system, it is necessary and responsible to adopt timely measures to avoid further deterioration," the firm said in a statement.

EPS Sura, which manages healthcare for some 5.3 million clients, will continue providing services. The decision will not affect Grupo SURA's solvency or liquidity, the statement added. Colombia's health ministry said in a statement that the request from Sura is in reaction to the structural failures of the country's health system and shows the need for reform.

A viability study must now be carried out before health regulators approve or deny the request, the ministry added. Petro has said he will present the reform once Congress enters its new session in July.

EPS Sura could become a direct healthcare provider under the proposed reform, from its current status as a healthcare administrator, the health ministry said. Petro's administration is also pushing a pension reform and labor and education reforms.

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