HK Stock Market Move | HYGEIA HEALTH(06078) rises more than 5%, the company is expected to benefit from prepaid health insurance, cash flow and bad debt conditions may improve.

HYGEIA HEALTH (06078) has risen more than 5%, reaching a 5.07% increase as of the time of writing, at HK$18.22, with a trading volume of HK$59.456 million. In recent news, the National Medical Insurance Bureau and the Office of the Ministry of Finance issued a notice regarding the prepayment of medical insurance funds. The notice stated that it supports regions with conditions to further improve the management of prepayment funds, helping designated medical institutions alleviate the pressure of medical expense prepayment through the prepayment of part of the medical insurance funds. BOCOM INTL believes that in addition to the selected drugs and consumables in the direct settlement of medical insurance funds and the negotiations on drugs, the implementation of a one-month prepayment of medical insurance (expected to be met by most pooling areas) is expected to alleviate the pressure on designated medical institutions and commercial distribution companies for prepayment, as well as the bad debt pressure caused by the delay in medical insurance payment/reimbursement funds, thereby effectively reducing the overall debt risk in the medical industry. HYGEIA HEALTH faced some pressure on medical insurance reimbursements in the first half of the year. Among the medical institutions it operates, in addition to the Heze region (including Chengwu, Danxian) itself facing significant pressure in the operation of medical insurance funds and may not meet the conditions for the implementation of prepayment funds, other regions (Chongqing, Suzhou, Xi'an, Wuxi, etc.) have good medical insurance income and expenditure balances and are expected to benefit from the one-month prepayment, thereby improving cash flow and bad debt situations. The bank maintains a "buy" rating for HYGEIA with a target price of HK$24.5.