President Ferdinand R. Marcos Jr.’s directive to grant a general amnesty and one-time interest waiver on unpaid PhilHealth contributions is a pragmatic response to a persistent challenge in the Philippines’ social health insurance system. Under this policy, employers, business owners, and self-employed individuals with missed payments from July 2013 to December 2024 will have one year to settle arrears without interest and penalties, potentially benefiting an estimated 300,000 members of the Philippine Health Insurance Corporation (PhilHealth).

At first glance, this move provides significant relief. It eases the financial burden on stakeholders who have lagged in compliance, often through no fault of their own. PhilHealth contributions, currently pegged at about three percent of monthly compensation, can weigh heavily on small businesses and freelancers. This amnesty acknowledges that reality and seeks to enable more members to sustain their good standing.

Yet while this intervention may improve short-term revenue and membership regularization, it must be viewed as a catalyzing moment for deeper reforms in Philippine health financing. For too long, PhilHealth has been constrained by structural weaknesses that undermine its effectiveness as a social health insurance system.

Studies and sector reviews have long highlighted systemic gaps. PhilHealth has struggled with fragmented enrollment processes, reimbursement inefficiencies, and challenges in covering the most vulnerable populations effectively. In some areas, local health centers have difficulty securing reimbursements, diminishing provider participation and access for patients. Moreover, reliance on contributory schemes alone — without robust mechanisms to integrate informal workers and subsidize those unable to pay — hampers progress toward universal health coverage (UHC).

Compared with some peer countries in Southeast Asia, the Philippines remains a laggard in health protection outcomes. Nations like Thailand and Vietnam have made more decisive strides through comprehensive, universally mandated health insurance schemes funded through a mix of contributions and general revenues, coupled with stronger institutional governance and accountability. These systems deliver wider financial protection and higher population coverage, especially among informal workers and the poor.

If the PhilHealth amnesty is to be more than a fiscal reprieve, government leaders must seize this policy’s momentum to pursue a holistic reform agenda. Five major reforms are imperative.

First: Automatic and seamless enrollment, especially for informal sector workers and self-employed individuals. Streamlining processes and strengthening digital platforms will reduce barriers to compliance and reduce gaps in coverage.

Second: Hybrid financing models that combine contributory schemes with tax-based subsidies for indigents and low-income households. Evidence from regional peers and global reviews suggests that full subsidies for vulnerable groups accelerate UHC and reduce out-of-pocket spending.

Third: Strategic purchasing and provider payment reforms to incentivize quality care and shorten reimbursement times. PhilHealth must transform from a passive funder to a strategic purchaser that drives efficiency and value for money.

Fourth: Enhanced governance, transparency, and accountability. Public trust in PhilHealth has been dented by administrative issues; robust oversight mechanisms and open reporting of fund utilization are essential.

Fifth: Stronger linkages with primary health care and community health systems. Initiatives like the Yaman ng Kalusugan (YAKAP) program provide useful platforms for integrating preventive care and expanding benefit packages.

The amnesty is a step toward improved compliance. The ultimate goal must be a Philippine social health insurance system that is equitable, sustainable, and resilient. Achieving this will require reforms that are inclusive, evidence-based, and aligned with best practices across Southeast Asia. The nation’s health security and economic progress are anchored on attaining this aspiration.