PhilHealth rumoured to be Closing at the End of 2016

Recently released information from a member of the board representing the Philippine Health Insurance Corporation, better known as PhilHealth, indicates that the national health insurance plan – said to provide universal healthcare to Filipinos – may well be defunct by the end of this year.

Set up in 1995, PhilHealth’s payouts are now rumored to exceed its income, rendering the organization unable to continue in its current form.

Mr. Eddie Dorotan, the member of the board who made the statement, said that PhilHealth may have lost as much as P1 billion last year alone, given that the payouts totalled P97 billion and the income just P96 billion.

Additional figures mentioned by Mr. Dorotan show that the Pantawid Pamilyang Pilipino Program (4Ps) paid out as much as P10 billion to senior citizens and other 4P beneficiaries, and a large percentage of the organization’s funds were spent on the enrolment of 5 million persons living in poverty.

According to the Department of Budget and Management (DBM), PhilHealth requires a two-year reserve fund totalling P100 billion in order to continue its operations, and should also be reimbursed by the national government. Aside from generating P5 billion from its investment portfolio, PhilHealth is also known to benefit considerably from the revenues generated by the so-called Sin Tax – the tax on “undesirable” items such as alcohol and tobacco – which generated P6 billion (or 20% of the tax’s overall income) last year for the healthcare provider.

In order to maintain current operations, the organization is stepping up its drive to collect outstanding payments from members in both the private sector and governmental departments, however, the outlook is rather bleak despite these two areas owing billions of pesos. Mr. Dorotan did indicate that the provider remains dedicated to fulfilling its promise of providing universal healthcare coverage to the nation for as long as is possible.

Should PhilHealth be forced to stop providing healthcare services at the end of the year, it is currently unknown what contingency plans – if any – have been put in place, but it would no doubt be safe to assume that discussions are on-going so as not to put the health of countless millions of Filipinos in jeopardy, potentially causing significant backlashes against the provider and the national government, not to mention the potential negative health consequences for our countrymen and women.

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