Does the Philippine Health Insurance Corporation (PhilHealth) need more subsidies from the government?
As far as senators are concerned, it is not necessary. And they have a valid point. PhilHealth has ₱89 billion in excess funds. This has been ordered transferred to the National Treasury, a move temporarily stopped by the Supreme Court.
Considering that access to affordable healthcare remains a challenge to most Filipinos, PhilHealth’s multi-billion surplus funds comes as a surprise.
At the Senate hearing on PhilHealth’s proposed 2025 budget, Sen. JV Ejercito, the principal sponsor and author of the Universal Healthcare Act, voiced his frustration over the unspent ₱89 billion funds, asking the state health insurance provider why these funds have not yet been used to ease Filipinos’ healthcare costs.
While PhilHealth holds a critical role in providing financial relief to millions of Filipinos, it only contributed a meager 13.6 percent to the nation’s total health spending in 2022. This discrepancy between available resources and actual contributions raises pressing questions: How can PhilHealth more effectively alleviate the healthcare burden on Filipinos? What reforms are necessary?
Let’s face it, Filipinos, particularly the lower-income families, struggle with the high cost of medical services. According to the World Health Organization (WHO), out-of-pocket spending continues to make up a large portion of Filipinos’ healthcare expenditures, leading many to delay or forgo necessary medical treatment. In fact, Philippine Statistics Authority data showed that in 2023 household out-of-pocket expenditure had the largest share in the country’s health spending at 44.4 percent, while voluntary health care payment schemes — payments for private insurance — had a 13 percent share. This underscores the need for a robust health insurance system that can ease the financial burden on individuals while ensuring quality healthcare is accessible for all.
As the country’s primary health insurer, PhilHealth is ideally positioned to help address this issue. However, its role in financing healthcare needs must be more proactive, transparent, and accountable. The ₱89 billion in surplus funds is a glaring example of a missed opportunity, especially when the healthcare needs of millions remain unmet.
This underutilization of funds could be attributed to systemic issues within the organization, including delays in claims processing, reimbursement issues for healthcare providers, and an overcomplicated system that discourages patients and hospitals from fully participating. These operational challenges need urgent attention.
Another possible reason for underutilization of funds is that the current benefit packages offered by PhilHealth are often insufficient to cover the full range of medical services that the average Filipino family requires. Many Filipinos still find themselves paying significant out-of-pocket expenses even when they have PhilHealth coverage.
In the wake of these developments, PhilHealth must take decisive steps to fulfill its mandate and reduce the healthcare burden on Filipinos. It must streamline operations and reduce bureaucratic red tape to eliminate inefficiencies, and ensure faster reimbursements for hospitals and healthcare providers. It should consider expanding coverage and improving benefit packages to cover a broader range of services, especially for critical care, outpatient services, and catastrophic illnesses. Strengthening governance mechanisms by ensuring accountability and combating fraud is necessary to help restore public trust.
The ₱89 billion in excess funds sends a clear message that the state health insurer has the resources to make a significant impact on the healthcare system. Filipinos deserve a healthcare system that works. With political will, effective leadership, and the active support of all stakeholders, PhilHealth can become a pillar of health security. The time to act is now.