The Department of Health (DOH) on Tuesday, Dec. 17, announced that the Philippine Health Insurance Corporation (PhilHealth) Board of Directors has approved a P284-billion budget for 2025 and increased benefits, including case rates, by as much as 50 percent.
“PhilHealth has a lot of money, well over the reserve fund ceiling allowed by law,” said DOH Secretary Teodoro J. Herbosa in a statement. “This surplus is a result of underspending for benefits through the years, which is why Filipino families pay high out-of-pocket expenses,” he added.
Herbosa, along with members of the PhilHealth Board of Directors, approved on Dec. 16 a P284-billion Corporate Operating Budget (COB) for Fiscal Year 2025.
“The Board approved higher benefits and a budget for 2025 that recognizes the need for PhilHealth to spend more so that families will spend less,” Herbosa said.
The DOH noted that the total amount approved is 10 percent higher than the previous year’s P259-billion COB.
Moreover, the DOH said the Board also approved the Benefits Committee (BenCom)-endorsed second round of increases in selected case rates, by as much as 50 percent.
“This is in addition to an emergency care benefit, glasses and optometric services for children, open-heart surgery benefits, and pediatric cataract extractions,” the DOH said.
The DOH explained that the COB is PhilHealth’s version of a General Appropriations Act (GAA) for the national government or a General Appropriations Ordinance (GAO) for local government units.
“The Board-approved COB for 2025 already factors in the zero government premium subsidy for indirect contributors in 2025, as decided by the Bicameral Conference Committee (Bicam) of Congress,” the DOH said.
The DOH explained that this includes computations by PhilHealth Management showing a P150-billion surplus as of Oct. 31, 2024.
The formula used, according to the DOH, is accumulated net income (also known as accumulated revenues) over the years amounting to P431 billion, minus the Reserve Fund ceiling of P281 billion.
Within the 2025 COB, the DOH said, P271 billion is programmed for benefit expenses — an increase of 11 percent compared to FY 2024.
“This increase takes into account Board-approved increases in case rates, Z benefits, PhilHealth Konsulta at P1,700 and P2,100 capitation per person, and 156 hemodialysis sessions at P6,350 per session. It also includes funds for emergency care, outpatient mental health, severe acute malnutrition, and many other standalone outpatient packages,” the DOH explained.
“Despite the increase in the budget for benefits, the Board approved an increase of only 3 percent for administrative expenses, from P12.1 billion in FY 2024 to P12.5 billion in FY 2025,” it added.
The DOH noted that capital expenditures in the PhilHealth COB 2025 were pegged at only P259 million, which is 91 percent less than the approved equivalent in FY 2024 at P2.9 billion.
“The Board observed that Management used only 8 percent of its COB 2024 for the purchase of information and communications technology (ICT) and other capital expenditures,” the DOH said.
“While it did not grant a new ICT budget for FY 2025, the Board extended the validity of the COB 2024 for ICT projects in the amount of P989 million to ensure that digitalization is prioritized,” it added.
The PhilHealth Board of Directors, chaired by the Secretary of Health (a non-voting member), includes four other ex-officio members: the Secretaries of Finance, Budget and Management, Social Welfare and Development, and Labor.
The Board also has three expert panel members and four sectoral members.
Another seat for a representative of local chief executives remains vacant.
The Board is separate and distinct from PhilHealth’s Executive Officers, led by its President and Chief Executive Officer (PCEO), Emmanuel R. Ledesma, Jr., and Executive Vice President and Chief Operating Officer (EVP/COO), Eli Diño D. Santos.