UNDER THE MICROSCOPE
The WTW Global Medical Trends Survey found health care benefit costs in the Philippines continue to be high at 18.3 percent compared to 19.3 percent in 2024. It is the second highest in the Asia Pacific region next to Indonesia at 19.45 percent. The rate is expected to be elevated in the long term. The factors cited as driving up medical costs in the country are increased utilization of health care services, rising hospital and clinic costs, frequency of diseases, and higher professional fees.
Medical inflation sadly mirrors the overall inflation rate, which shows no signs of abating despite the national government’s efforts to control it. In fact, it is driven partly by the general inflation rate, which drives up hospital and clinic costs. Now medical inflation has surpassed the pre-pandemic levels.
This does not augur well for health insurance providers, also known as HMOs (Health Maintenance Organizations). They claim that health care costs have increased due to increased utilization by 79 percent, driven by over-prescription of drugs and diagnostics as the top internal factor.
It doesn’t help that new medical technologies are more expensive. New imaging techniques (X-rays, ultrasound, Computed tomography (CT), PET scans) and molecular laboratory testing are definitely more costly than older technologies. Even robotic surgery costs more than traditional surgical techniques, due to the heavy investment in robotics equipment.
HMOs and private hospitals are continuously pressured by overwhelmed public health care systems and by the lack of cost-sharing mechanisms. We all know how overcrowded government hospitals are, so many would rather go to private hospitals where they can be attended to more quickly, and the only way they can afford private hospital costs is if they have private health insurance.
Medical costs are forecast to increase in the long term. All parties concerned (patients, doctors, government and private hospitals, HMOs, PhilHealth) should come together to address the issue.
We are all potential patients, as illness can strike even the most health-conscious. The best way to stay healthy is to practice self-care in terms of the food we eat, the exercise we need, and the safety precautions in daily living. Should illness strike, a basically healthy person will have better chances of avoiding hospitalization or just having a short hospital stay. Those who are not mindful of their health will find that having existing co-morbidities like obesity, hypertension, and diabetes, they will have longer hospital stays leading to higher hospital bills. Primary prevention is key to staying healthy.
Doctors are vital in promoting health. They should champion healthy lifestyles when patients consult them. Professional fees (PF) are also increasing, with HMOs and doctors’ groups in negotiations on a possible 80 percent to 150 percent hike in professional fees. It may be that the rates set by HMOs are too low, thus the doctors are clamoring for additional compensation, since they also have clinics, staff, and equipment to purchase and maintain. Doctors have been accused of charging high PF but we have to keep in mind the long hours they keep, the required attendance in continuing education courses and other expenses incurred in their practices. Overcharging doctors are few and far-between in my experience and knowledge, since word gets around and patients avoid them. Doctors should also be mindful of over-prescribing drugs and tests.
Hospitals, government and private, are navigating the health environment in an era of rising costs due to personnel salaries and equipment investments and maintenance. Government hospitals are overwhelmed by the number of patients they serve and the limitations of their budgets. Both are hampered by the huge backlogs of PhilHealth reimbursements that are not processed or given due course by PhilHealth. Private hospital owners are griping that they operate on a losing basis with reimbursements delayed for months/years or outright disallowed.
PhilHealth comes to mind when people are hospitalized. But its case rates are inappropriately low, forcing patients to rely on HMOs or pay out of pocket, which not many can afford to do. As an example, hemorrhagic stroke, which will land a patient in the ICU, has a case rate of ₱38,000, which is good only for a day’s stay in the ICU or even less. No wonder it has a large surplus of funds, which has been taken away by the national government. For 2025, it will have no government funding since it still boasts of a surplus.
Should it be paying more appropriate fees for the different diseases and paying the hospitals promptly, I doubt if PhilHealth can still boast of surpluses.
We better fix this issue before our health care system collapses with HMOs and private hospitals closing down. Government hospitals can’t serve all Filipinos on their own.
In the meantime, let’s try to stay healthy or face catastrophic illnesses that will drive us to bankruptcy.
Bawal magkasakit!