MANILA, Philippines – The status of payment of claims and implementation of services by the Philippine Health Insurance Corporation (PhilHealth) were questioned before the Supreme Court during the oral arguments of the state insurer’s fund transfer on Tuesday, February 25.
Among the issues raised during the discussion is the payment of claims made by hospitals and doctors. Associate Justice Amy Lazaro-Javier sought clarification on whether the state insurer had already settled all claims before it sent back P60 billion to the National Treasury in 2024.
The Office of the Solicitor General had commented before the High Court that these expenses had already been recorded and recognized in PhilHealth’s books. However, Lazaro-Javier pointed out that recognizing accounts that still need to be paid in the books of PhilHealth is a different matter, prompting her to ask, “Has PhilHealth paid all the recorded and recognized claims before it transferred the funds to the treasury?”
PhilHealth Senior Vice President Renato Limsiaco Jr. admitted that the state insurer failed to settle all claims before transferring funds to the National Treasury in 2024.
“Your honor, in a certain cut-off date, definitely hindi ho natin mababayaran lahat (we cannot pay all of it),” Limsiaco said.
Under the state insurer’s implementing rules and regulations, PhilHealth should process all claims filed within 60 days. However, the official said there have been instances where they could not comply with the timeline.
PhilHealth was also called out during the oral arguments for how it was auditing its financials. The Commission on Audit issued the state insurer an adverse opinion after finding that its financial statements from 2020 to 2021 “do not present fairly” the financial health of PhilHealth, noting that its assets have been overstated.
Limsiaco said that PhilHealth has since addressed the comments and have enough investments to cover benefit payments.
The state insurer had received criticism in 2024 for having excess funds and still failing to improve benefit packages for members. Former PhilHealth chief Manuel Ledesma Jr. himself said it took over a decade for some packages to be updated.
Pandemic delayed UHC implementation
In 2024, the state insurer increased case rates and new benefit packages were also approved later in the year. The implementation of these programs came in late, as Lazaro-Javier pointed out that these should have been ready two years after the Universal Healthcare Law was passed in 2019.
However, the Department of Health said that they got sidetracked because of the pandemic.
“There is a supervening circumstance that happened, the pandemic happened,” DOH spokesman Albert Domingo told the Court.
“When the Universal Healthcare Act was being set up, there was in fact a 10-year timeline for which all institutions with varying roles are to comply. No one expected that [COVID-19] would come out in December 2019 so there was a good three years where everything was thrown off.”
Fund for supplemental benefits still in the works
PhilHealth said it has successfully set up the national insurance fund or the “pay as you go fund” as well as the funding to cover lifetime members — for retirees or those that have paid at least 120 monthly contributions (10 years).
Limsiaco said PhilHealth has P28.6 billion for lifetime members sourced from the insurer’s accumulated revenues in 2019.
Meanwhile, the insurer is still “working on” the fund for the optional supplemental benefits that can help with members’ healthcare payments. Limsiaco said they have been setting it up for three years and it might be up and running by this year.
“We need [money] for the initial implementation but the supplemental has a contribution that has to be collected, Your Honor,” he said.
Lazaro-Javier clarified: “So everything is charged to the contribution of the members?”
“Yes, Your Honor, because this is supplemental…on top of the basic one, so contribution will be collected for the [supplemental benefits],” said Limsiaco.
Limsiaco later clarified that the initial budget for the supplemental benefits fund will be sourced from the P284-billion corporate operating budget of PhilHealth.
When news broke that the government had provided zero subsidy for PhilHealth, Health Secretary Teodoro Herbosa, who also chairs the PhilHealth board of directors, clarified that the state insurer would continue to provide services to members.
The bulk or P271 billion will be allocated to benefit expenses in 2025, P12.5 billion to administrative expenses, and P259 million for capital expenditures. – Rappler.com