It is often said that this country has many laws that are laudable but have suffered in implementation.
Some laws fall victim to a change in administration. The succeeding Executive and Congress simply refuse to fund the laws through appropriations. Such was the fate of the Responsible Parenthood and Reproductive Health Act which got no funding from a Tito Sotto-led Senate.
The Universal Health Care (UHC) law offers a different example of how good legislation gets destroyed.
The UHC Act was passed in February 2019, and its Implementing Rules and Regulations were signed a year later. The UHC implementation thus ran into a two-year pandemic. The health sector faced the tough challenge of responding to the pandemic and setting in motion the UHC reforms at the same time. Evidently, the health of the whole population was the priority through preventing disease and flattening COVID-19.
After the pandemic, the Philippine Health Insurance Corp. (PHIC or PhilHealth) funds intended for UHC implementation but unused during the pandemic fell prey to a Congress looking for “excess, unused funds,” to fund pet projects or pork barrel. Congress grabbed P89.9 billion of PhilHealth’s reserve funds.
Congress further escalated its war on “unused” health funds by imposing a punishing 50% cut in funding for PhilHealth’s indirect members in the 2024 General Appropriations Act (GA) item for PhilHealth.
Not content with defunding 50% of the support for PhilHealth, Congress removed PhilHealth from the 2025 GAA. The national budget did not provide a single peso for the poor, seniors, and disabled.
Congress did not forget to grab credit for the health system by moving PhilHealth’s funds to the patronage-heavy Medical Assistance for Indigent and Financially Incapable Patients (MAIFIP). In 2024-2025 PhilHealth got P27 billion from the budget for the poor (indirect contributors) while MAIFIP received P99 billion. This is a gross distortion of the Social Health Insurance program enshrined in the UHC law.
Like lambs, the previous PhilHealth managers and the board took all this punishment. Further, to pacify the public and counteract the political fallout, despite PhilHealth’s shrinking budget, they cranked out benefit packages that were rushed and clearly unsustainable.
CONSEQUENCES OF DEFUNDING, FACE-SAVING BENEFITSIn 2024, PhilHealth suffered a loss in its operations, the first since 2011 when it paid out P34.934 billion in benefits while gaining only P33.294 billion in premiums, a loss of P1.64 billion.
Last year, PhilHealth suffered its largest annual loss at P29.799 billion after paying out P234.520 billion and earning only P204.097 billion.
As a consequence, PhilHealth’s liabilities (net of its reserves) at the end of 2024 now stand at P941.749 billion, from P663.706 billion the previous year.
When she saw that PhilHealth’s liabilities stood at P663 billion in 2023, Supreme Court Justice Amy Lazaro-Javier remarked: “I will show you the report of CoA (Commission on Audit) which shows that PhilHealth is bankrupt, actually.”
This 29% increase in liabilities in the year when benefits ballooned to P185 billion and, worse, when the National Government took away P60 billion should prompt Congress to withdraw the proposed legislation amending the UHC law that includes reducing premiums by an effective 30% for both the workers and the poor.
PHILHEALTH FACING BANKRUPTCYThe amendment on the premium, if made effective this year, will see a reduction in PhilHealth’s income of around P160 billion (from direct members exclusively). At the same time PhilHealth will probably be paying out P240.5 billion (payouts are increasing by 30% per year), leading to at least a P90 billion loss for PhilHealth’s this year. The loss will increase to P150 billion in 2026, with premiums frozen at reduced rates.
By 2026, PhilHealth’s reserves may not be able to cover even one year’s operations in 2027, forcing the health insurance corporation to seek relief from government. Why reduce rates now when PhilHealth will ask for relief in two years’ time?
MORE ANTI-POOR LEGISLATION ON THE WAYBut the amendments to the UHC law do not just concern premiums. There is increasing pressure to lift the regulatory guardrails such as the necessary positive recommendation of the Health Technology Assessment (HTA) team, which will lead to unregulated proliferation of medicines, supplies, technologies, and procedures that have not passed through the HTA process.
Another amendment seeks to blow up the health system into 1,500 parts, giving every mayor and governor a slice of the health system pie, making the health system that much more inefficient. Failure in the local health systems run by local government units will only result in increased privatization of the health system, leading to higher costs and leaving out the poorest.
Apart from amendments to the UHC law, Congress is destroying UHC through other means. It is also considering destroying the source of funding for UHC, the Sin Tax Reform Law. The House of Representatives has approved a bill that will lower tobacco taxes and eventually remove the automatic increase in tax rates for inflation adjustment. This means a reduction in long-term funding for PhilHealth, since the bulk of the tobacco excise tax is earmarked for PhilHealth.
All in all, we ask Congress to change course. Do not destroy UHC. Implement it now.
Juan Antonio “Jeepy” Perez III, a doctor of Medicine, specializes in public health administration, primary healthcare, and has worked with nine Health Secretaries and three NEDA Secretaries since 1992. He was undersecretary for Population and Development and executive director of the country’s Commission on Population and Development up to Sept. 8, 2022, when he retired. He occasionally writes for Action for Economic Reforms.
