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The short answer
A clinic gets paid by HMOs in two ways: capitation, a fixed monthly sum per enrolled patient for primary care, and fee-for-service claims for referred or secondary care billed against an agreed tariff and an authorisation code. Getting paid depends on a signed tariff agreement with each HMO, complete claims submitted on schedule, and an ageing report that shows which claims are overdue and which HMO to chase.
For many private clinics, HMO patients are now a large share of attendance, and HMO receivables are the biggest number on the balance sheet. The care is delivered today; the money arrives weeks or months later, if the paperwork is right. This guide covers the three things that decide whether you are paid: the agreement, the claim and the follow-up.
Capitation and fee-for-service: two different revenue streams
- Capitation
- A fixed amount per enrollee per month, paid to the primary provider whether or not the enrollee visits. It covers the primary-care package in the plan.
- Fee-for-service (FFS)
- Payment per service for care outside capitation, usually secondary care and referrals, billed as a claim against an agreed tariff and normally needing an authorisation code from the HMO.
The rates moved sharply under the National Health Insurance Authority (NHIA). In February 2025 the NHIA announced a 93% increase in capitation and a 378% increase in fee-for-service rates from April 2025, after a 60% and 40% rise about six months earlier, according to BusinessDay. These apply to NHIA programmes; private HMO plans set their own tariffs by agreement. Ask each HMO in writing which tariff applies to which plan.
The tariff agreement: settle it before you treat
Every HMO you accept should have a signed provider agreement on file. Check that it states:
- The tariff list for each plan, with drugs and consumables either priced or tied to a named price list.
- Which services need pre-authorisation, how codes are requested and how fast the HMO must respond.
- How and when claims are submitted (portal, email, hard copy) and any cut-off for late claims.
- Payment terms after a claim is accepted, and how queries and part-payments are handled.
- How capitation lists are sent each month, and what happens to patients missing from the list.
- Your clinic's bank details, confirmed in writing.
That last point is not trivial. When the FCT Administration warned in July 2025 that it would sanction HMOs that fail to remit promptly to providers under the FCT Health Insurance Scheme, some HMOs had blamed missing hospital bank details; the FCTA rejected the excuse (Peoples Gazette). Do not give anyone that reason to delay.
Building a claim that gets paid
- Verify at the front desk. Confirm the enrollee is on this month's capitation list or is active on the HMO's portal before treatment.
- Get the authorisation code first for any service that needs one. Record the code, the time and the name of the HMO officer.
- Document fully. Diagnosis, services, drugs with quantities, and the treating clinician's signature. Claims are vetted against the notes.
- Bill at the agreed tariff, not your cash price. A claim above tariff is cut back, and the delay costs more than the difference.
- Batch and submit on schedule, usually monthly, with a covering schedule listing every claim and total.
- Get an acknowledgement with the date received, then log it.
Ageing: the report that tells you who to chase
Group unpaid claims by HMO and by how long since submission. The example below shows a clinic with ₦4,850,000 outstanding.
| HMO (example) | 0–30 days | 31–60 days | 61–90 days | Over 90 days | Total |
|---|---|---|---|---|---|
| HMO A | ₦900,000 | ₦450,000 | ₦0 | ₦0 | ₦1,350,000 |
| HMO B | ₦600,000 | ₦700,000 | ₦500,000 | ₦300,000 | ₦2,100,000 |
| HMO C | ₦400,000 | ₦0 | ₦250,000 | ₦750,000 | ₦1,400,000 |
| Total | ₦1,900,000 | ₦1,150,000 | ₦750,000 | ₦1,050,000 | ₦4,850,000 |
Read it this way: HMO A is current. HMO B is slipping across every column. HMO C has ₦750,000 over 90 days, which needs a reconciliation meeting, not another reminder email. If an HMO owes more than one month of your payroll, consider whether to keep accepting new referrals from it until the account is reconciled.
Queries and reconciliation
Most delays come from queried claims. Keep a query log: claim number, reason, date answered. Agree the reconciled figure in writing before payment. In the same NHIA report, complaints against HMOs included delays in settling agreed reconciled payments and in issuing referral authorisation codes; 47 HMOs were sanctioned. Complaints can be raised with the NHIA, but your strongest position is a clean file.
What to check first
- Is there a signed agreement and current tariff for every HMO you accept?
- Does every FFS claim carry an authorisation code and complete notes?
- Has each monthly capitation payment been matched against the enrollee list?
- Which claims are over 60 days, and who is following them up this week?
For a wider view of chasing money owed, see accounts receivable done well and bookkeeping and tax for a private clinic.
Where Pryme fits
A Pryme Business Account can give each HMO its own virtual account number, so capitation and claim payments arrive already labelled by payer. The Finance agent can prepare the ageing report and draft follow-ups for a person to approve, with every action recorded.
Questions people ask
What is capitation in HMO?
Capitation is a fixed monthly amount an HMO pays a primary-care provider for each enrollee registered with it, whether or not the enrollee visits. It covers the services in the plan's primary-care package.
How long do HMOs take to pay hospitals in Nigeria?
It depends on the provider agreement. We did not find an NHIA rule giving a fixed number of days in the sources we checked, so the payment period in your signed agreement is what you can hold the HMO to.
Why are my HMO claims being rejected?
Common reasons are missing authorisation codes, billing above the agreed tariff, incomplete clinical notes, enrollees not active on the date of service, and claims submitted after the cut-off.
Can I report an HMO that is not paying my clinic?
Yes. The NHIA handles complaints about HMOs, including delays in settling reconciled payments. Keep your agreement, claims schedules and acknowledgements to support the complaint.
Sources
- BusinessDay: NHIA hikes capitation by 93%, fee-for-service by 378% (4 Feb 2025) · accessed Oct 2026
- ICIR: NHIA sanctions 49 health facilities, 47 HMOs (30 Jun 2025) · accessed Oct 2026
- Peoples Gazette: FCTA to sanction HMOs over delayed remittance to healthcare providers (29 Jul 2025) · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.