MANILA, Philippines – Department of Health (DOH) Secretary Teodoro Herbosa guaranteed that the Philippine Health Insurance Corporation (PhilHealth) will continue to provide services in 2025 despite not getting subsidies from the government.

As expected, the state insurer is tapping into its reserve funds — with the PhilHealth board of directors approving on Monday, December 16, a P284-billion corporate operating budget for 2025. The department said this “already factors in the zero government premium subsidy for indirect contributors for 2025.”

“Hindi po magsasara ang PhilHealth (PhilHealth will not close down),” Herbosa, who chairs the PhilHealth board of directors, said in a press conference on Tuesday, December 17.

“Even without the subsidy, we continue to provide all the health benefits in this population, our indirect [contributors] — the indigent, senior citizens, PWDs (persons with disabilities),” he added in a mix of English and Filipino. “We will still cover their benefits, also they will still be given no balance billing privileges.”

According to the DOH, the budget takes into account a P150-billion computed surplus as of end-October. The amount was computed by subtracting the P281-billion reserve fund ceiling from the accumulated income of P431 billion over the years.

The department is allocating majority or P271 billion for benefits expenses in 2025. This means PhilHealth Konsulta packages, hemodialysis sessions, emergency care services, outpatient mental health, and other outpatient packages will remain covered by the state insurer.

Meanwhile, P12.5 billion will be spent on its administrative expenses, a 3% increase from its P12.1-billion allocation in 2024.

The budget for PhilHealth’s capital expenditures dropped 91% to P259 million from P2.9 billion in 2024. This comes after the state insurer only used 8% of its 2024 budget, which it used to spend on information and communications technology (ICT) equipment, among others.

ICT projects will be given P989 million this year as the DOH wants to continue digitizing the country’s healthcare system.

Lawmakers from both houses of Congress agreed to give zero funding towards PhilHealth’s subsidy for 2025 after the state insurer was found to have billions in unused funds. PhilHealth will still have funding for operational costs.

Earlier this year, the Department of Finance had ordered PhilHealth to remit P89.9 billion of its excess funds.

The state insurer had carried out three fund transfers worth P60 billion back to the National Treasury before the Supreme Court issued a temporary restraining order. The first tranche worth P20 billion was used to settle the unpaid health emergency allowance of healthcare workers who served during the pandemic.

Herbosa on Tuesday said that they plan on continuing improving case rates and packages, despite government cutting off the state insurer’s subsidies. They are eyeing to increase hospital reimbursement rates to 50% to 70%, for instance.

“Tuloy ‘rin ‘yung pag increase ng benefits… actually, minimal ‘yung effect (The increase in benefits will continue… actually, [the zero subsidies] will have minimal effect),” Herbosa said.

“Ang effect, I think, is that PhilHealth will try to make sure that it serves efficiently, the management of the funds… hindi pwedeng maipon lang siya tapos walang benefit (The effect, I think, is that PhilHealth will try to make sure that it serves efficiently, the management of the funds… it cannot just accumulate and then not have any effects to benefits).”

It had taken over a decade before PhilHealth started improving its benefit packages. – Rappler.com