PhilHealth’s ‘broken system’ needs fixing, says DOH chief
Health Secretary Teodoro Herbosa on Friday chided the management of the Philippine Health Insurance Corp. (PhilHealth) for treating it like a pension fund and for keeping or investing its money instead of spending it for the people’s health needs.
“That’s why their emphasis has been to protect the fund and resist paying the health benefits of its members!” he said in a Facebook post. “We need to fix this broken system.”
In another post on X (formerly Twitter), the health secretary reiterated that PhilHealth’s main purpose was “to provide financial assistance for your medical needs.”
“PhilHealth needs to pay the health benefits of its members! PhilHealth must not invest government funds in the bank. PhilHealth must invest in the Filipino people! it must pay its arrears to hospitals and doctors in a timely manner,” he said.
TUCP clamor
Herbosa, who chairs the PhilHealth board of directors, said that PhilHealth managers were acting as if PhilHealth was a pension corporation that would typically invest and accumulate as much funds as it could.
“It seems many do not understand the difference between pension and health insurance,” he said. “Pension and health insurance serve distinct purposes, providing financial protection in different ways.”
As chair of the PhilHealth board, which is supposed to oversee the management staff, Herbosa could exercise his prerogatives to realign the orientation of its operating system.
Luis Corral, vice president of the Trade Union Congress of the Philippines (TUCP), the largest labor federation in the country, said in a statement on Friday that an “immediate overhaul” of PhilHealth’s priorities was needed to fully benefit all Filipinos.
The labor group called on Herbosa and the Department of Health to push for enhanced healthcare packages that truly reflected the principles of the Universal Health Care (UHC) Act.
“It is the hard-earned contributions of the working class that sustain PhilHealth. It is not the worker’s fault that PhilHealth coverage falls short—it is the responsibility of its leadership to be on top to address these gaps,” Corral said.
Differences
In his Facebook post, Herbosa enumerated the difference between pension and insurance.
In terms of primary objective, he said pension “provides a steady income stream” after retirement to ensure financial stability and security in old age, while health insurance “covers medical expenses, hospitalization, and other health-care-related costs, protecting against financial strain due to illness or injury.”
Pension is typically offered by employers or purchased individually, with contributions made during working years and benefits are paid out after retirement, usually as a monthly annuity. A pension plan also often includes survivor benefits and lump-sum payments.
Basis for eligibility
On the other hand, health insurance covers hospitalization, surgical procedures, doctor visits and other medical services. Health insurance companies may offer additional benefits like dental, vision and wellness programs. Premiums are paid monthly or annually, and benefits are paid out when medical services are utilized.
In terms of eligibility and enrollment, Herbosa said in a pension plan, eligibility is often tied to employment or age, while health insurance is generally available to individuals, families, or employees through group plans.
Pension benefits are typically based on salary, years of service, or contributions while health insurance benefits are determined by policy terms, coverage limits and out-of-pocket expenses.
Call for urgent reforms
Pension and health insurance contributions may be tax-deductible, but pension benefits are taxed as income, while health insurance benefits are generally tax-free.
Amid the controversies surrounding the allocation and use of PhilHealth funds, particularly the millions of pesos set aside for its anniversary celebrations, TUCP called for urgent reforms in the state health insurer.
“We are dumbfounded by the lack of decisiveness needed in meeting the mandate of the UHC Act which, to quote the law, is to ‘ensure that all Filipinos are guaranteed equitable access to quality and affordable health-care goods and services, and protected against financial risk,’” Corral said in his statement.
Corral recalled that during a Senate health committee hearing on the PhilHealth budget, Herbosa said that they were struggling to implement UHC partly because indigent patients and ordinary workers were opting for private rooms instead of charity wards where they could enjoy full PhilHealth coverage.
He said Herbosa’s remarks exposed his “highly insensitive, shocking and condescending view” of ordinary workers who should just settle for the bare minimum of health care in charity wards because that was all PhilHealth could pay for them.
Against Marcos vision
Herbosa betrays President Marcos’ “vision of a ‘Bagong Pilipinas’” and counters the “tone-perfect assurance” by the President that there would be no diminution of PhilHealth coverage packages and that these would even be further enhanced, according to Corral.
“Instead of acknowledging the harsh ‘kalunos-lunos’ (pitiful) reality of overcrowded and underfunded public hospitals and charity wards, which further amplify and heighten the misery, pain and fear of our sick countrymen and their immediate kin, it is as if Secretary Herbosa overlooked all these, cavalierly saying that it is the worker’s fault for getting private rooms in the hope of surviving their illnesses,” he said.
This gave the impression that the health secretary was “dismissive of our aspirations for better health care,” Corral said.
According to the TUCP leader, Herbosa should have instead said that “This is what we can currently afford, but it’s not enough. Our patients deserve better, and we will fight tooth and nail to make this possible.”
