MANILA, Philippines – The Philippine Health Insurance Corporation (PhilHealth) will remit P10 billion to the National Treasury on Wednesday, August 21, as scheduled.

This will be the second tranche of the state insurer’s controversial transfer of P89.9-billion “excess funds” ordered by the Department of Finance (DOF) in a circular in February. PhilHealth President Emmanuel Ledesma Jr. said they are merely following directives.

“I’m just echoing what [Finance Secretary Ralph Recto] keeps mentioning, if there’s a TRO or if the Supreme Court asks us to do otherwise, we, of course, will abide. If the Supreme Court tells us to return everything… basta susunod lang kami sa anong sinabi ng Supreme Court (we will just follow what the Supreme Court says),” Ledesma told the Senate committees on health and demography and finance on Tuesday, August 20.

Healthcare workers’ groups — and even the state insurer’s own labor union — are not in favor of the fund transfer, arguing that these could be used to expand the state insurer’s coverage and support individuals who need financial aid for their medical expenses. Healthcare workers also believed that the transfer is illegal as under the Universal Health Care Act (UHC), excess or reserve funds should be used to improve benefits and cut costs from paying members.

On August 2, a group led by Senate Minority Leader Aquilino “Koko” Pimentel III elevated the issue to the Supreme Court (SC), seeking a temporary restraining order to prevent further transfers and have the DOF return the money that was already transmitted by the state insurer. They also want the High Court to declare the DOF Circular unconstitutional.

The Supreme Court has asked Recto, Ledesma, Speaker Martin Romualdez, and Senate President Francis “Chiz” Escudero to comment on the petition.

Recto previously defended the legality of the DOF’s directive, citing the provision of the 2024 General Appropriations Act (GAA) on unprogrammed funds. He also noted that Congress can order the DOF to stop collecting funds from the state insurer.

Without transfer, HEAs would remain unpaid

PhilHealth is doing the transfer in four tranches, with P30 billion slated to be transferred sometime in October 2024 and P29.9 billion in November 2024.

The first transfer — which amounted to P20 billion — was already remitted on May 10, 2024. The Department of Health (DOH) said it was used to settle the unpaid health emergency allowance (HEA) of healthcare workers who served during the pandemic.

“Our colleagues from the DBM (Department of Budget and Management) can confirm this but it is our understanding, had nothing been done, there would have been no budget within the 2024 GAA to actually fund the [HEA],” Eduardo Anthony Mariño III, deputy treasurer at the Bureau of Treasury (BTr), told the panel.

“It is because the additional resources presented by the initial remittance of the P20 billion that this is made possible within the year,” he added.

Health reform advocate Dr. Anthony Leachon pointed out that the HEA claims of healthcare workers should have come from the DOH budget.

In July, the DBM announced that the government was releasing P27.453 billion to cover the unpaid HEA from the pandemic.

DOH Spokesman Dr. Albert Domingo said the agency initially included the needed funding for the unpaid allowances in its 2025 budget proposal, but it was removed.

Infra projects will be funded too

Under the 2024 GAA, the government is allowed to tap reserve or extra funds of government-owned or -controlled corporations (GOCCs) to be reallocated as unprogrammed or standby funds that the government can utilize for projects, if needed.

With the first P20 billion of PhilHealth’s transfer used for HEA claims, Ledesma reiterated the state insurer’s hope that the rest of the funds will be used for other healthcare projects. “We are insisting health-to-health,” he said.

However, the BTr noted that it could be used for other infrastructure projects included in the government’s unprogrammed appropriations, which also cover social programs, support for foreign-assisted projects, and payment for pensions, among others.

“One potential reason why our poor Filipinos are not capable of availing of the PhilHealth benefits is precisely because they have trouble going to the hospital so you have problems with the road infrastructure, transportation,” Mariño said.

“The items in the unprogrammed appropriations are those things that can help alleviate the supply constraints that is critical bottlenecks in the implementation of the Universal Healthcare Act,” he added.

But Leachon said the fund transfer is “an erroneous way of doing it.”

“Ang uunahin mo serbisyo. Bakit mo papatayuan ‘yan ng ospital, tulay, at iba pa in order to realize universal healthcare e hindi naman magagawa ang isang building in one day? Samantalang mamamatay ka in one day ‘pag ‘di ka nabigyan [ng panggamot],” he said.

(You should prioritize giving service. Why would you use those funds to build hospitals, bridges, and others in order to realize universal healthcare when you cannot even construct a building in one day? But you could die in one day without resources for treatment.) – Rappler.com