Philippine Health Insurance Corporation (PhilHealth) received a PHP74 B-worth of slash in subsidy from the national government, leading to a complete ‘zero-subsidy,’ which was supposed to cover the premiums of indirect contributors as of June 2024.
These contributors include Indigent families identified by the Department of Social Welfare and Development (DSWD), Pantawid Pamilyang Pilipino Program (4Ps) beneficiaries, senior citizens, persons with disabilities (PWD), patients identified at point-of-service (POS)
Validation to zero subsidy
The Bicameral Conference Committee was frustrated at the massive amount of underutilised PHP600 B in PhilHealth's reserve fund, validating the removal of the agency’s subsidy.
Senator Grace Poe noted that PhilHealth has sufficient funds for annual operating expenses and executive salaries for the succeeding years.
“Hindi p’wedeng sisihin na nagkulang tayo sa pagbibigay sa kanila kasi andai nang perang nan’dyan. Hindi nila pinamimigay ang pera sa mga nangangailangan. Tinuturuan natin sila ng leksyon,” Poe said.
Anti-poor move
According to Social Watch Philippines (SWP), the decision of the committee was ‘an insult’ and demonstrates a ‘disregard’ for Universal Health Care (UHC), where the zero budget allocation for indirect contributors, like the poor and vulnerable, is abandoning the duty towards the fulfillment of effective healthcare.
The removal of the PhilHealth’s subsidy can lead to:
- Increased membership contributions
- Reduced benefit packages
- Limitations in healthcare services
- Lack of facilities for construction
Senator Bong Go also shared his disapproval of the committee’s decision, citing that the move was ‘unacceptable’ despite its reserved funds.
“Ipinaglalaban nga natin na gamitin dapat ng Philhealth nang tama ang pondong mayroon sila ngunit bilang mga mambabatas, suportahan rin natin ang hangaring ito sa pamamagitan ng pagsigurong mapupunta sa health ang pondo na para naman talaga sa health na naaayon naman sa batas,” Go stated.
Is the zero-subsidy action against the law?
SWP also criticized the decision, expressing disappointment that it violates the Sin Tax Law by failing to allocate the ‘full earmarked funds,’ which should amount to a minimum of PHP69.81 B.
In 2024, the Department of Finance reclaimed PHP89.9 B PhilHealth reserves, which cites a legal provision in the General Appropriations Act of 2024 to allow the reallocation of ‘idle or unused’ funds to be used in other more ‘effective’ ways.
According to the DOF Circular No. 003-2024, a directive to transfer unused subsidies of PhilHealth to the national treasury is to ‘bolster the government’s unprogrammed appropriations,’ serving as a financial reserve for projects, programs, or expenses not itemized in the national budget.
Currently, these are alleged to be reallocated to direct cash aid assistance programs like the Ayuda sa Kapos ang Kita Program (AKAP) program spearheaded by the Department of Social Welfare and Development (DSWD).
Justifying the cuts
President Ferdinand Marcos Jr. backs up the removal of subsidy for PhilHealth, saying that the real issue of the agency is not its budget nor its financial coverage, but a ‘clogged’ system due to having a limited ‘processing capacity.’
He also added that the broken system of PhilHealth includes the ‘roo much’ service and ‘slow process’ as he cited an example of PhilHealth's encounter in the province, where people wait an entire day just to receive benefits.
According to Marcos, Philhealth’s main focus must be digitalization to ensure ‘faster’ and ‘more efficient’ processing of insurance claims whi;e coverage and payments continue to happen.
“The reason we do not want to subsidize [PhilHealth] because the subsidy uupo lang sa bank account ng PhilHealth, hindi magagamit.” he said.
