Marcos ‘no objection’ to PhilHealth contribution hike, says CEO

The increase in contributions to the Philippines Health Insurance Corporation (PhilHealth) will not be suspended as President Ferdinand Marcos Jr., himself, did not oppose the hike, PhilHealth president and CEO Emmanuel Ledesma Jr. said Friday.

At a press briefing in Pasig City, Ledesma said the state health insurer received a letter from the Office of the President, through Executive Secretary Lucas Bersamin, that “they pose no objection to the scheduled increase which was implemented on January 1st” after a “very thorough study.”

The PhilHealth chief said the agency sought clarification from the President following Health Secretary Ted Herbosa's appeal to suspend the implementation of the increase.

“It was clearly stated by PBBM that the premium increase will continue,” Ledesma said.

The Presidential Communications Office (PCO), meanwhile, said that Marcos is still reviewing the matter. 

"The review is still ongoing. The President wants to ensure that any increase in premium will substantially be much more in value in terms of benefits and coverage to Philhealth members," said PCO Chief Cheloy Garfil in a text message to GMA News Online. 

Effective January 1, the premium rate went up to 5% while the monthly basic salary ceiling will increase to P100,000 and the minimum remains at P10,000.

To illustrate, if a worker earns P10,000 a month, his/her monthly contribution to PhilHealth should amount to P500 effective this year. The premium contribution shall be equally shared between the employee and employer.

Last year, the premium rate was supposed to increase to 4.5%, while the monthly basic salary ceiling should have been P90,000. However, it was suspended by Marcos due to socioeconomic challenges caused by the pandemic.

The scheduled increase in PhilHealth rates is in accordance with the Universal Health Care (UHC) Law which was signed in 2019 by then-President Rodrigo Duterte. The law mandates gradual hikes in the PhilHealth contribution rate until it reaches 5% in 2024.

Minimum wage earners

PhilHealth had earlier said that its plan to expand the coverage of its benefits packages this year would still push through even if Marcos suspends the mandated increase in premium rates as scheduled.

The President had also said that he wants to see an increase in services following the implementation of the premium rate hike this year.

Ledesma said earlier that the state health insurer is expecting an additional P17 billion in revenues this year from the increase in premium rate.

“You can be assured that 100% of that money will be used wisely and reported in detail, regularly with the President,” the PhilHealth chief said.

PhilHealth on Thursday said it was open to the idea of suspending the implementation of premium payments for minimum wage earners.

This comes after Appropriations Committee Senior Vice Chairperson and Marikina Representative Stella Quimbo called for the temporary suspension to pave the way for the utilization of the unspent appropriations allocated to PhilHealth for premium subsidies.

Financially afloat

During Friday's briefing, Ledesma said PhilHealth's financial position would remain afloat even if the collection of contributions or premiums from minimum wage earners will be suspended.

"We're thoroughly studying it. [But] personally, I feel our cash position is healthy… At the end of the day, our heads will still be above water. I think we'll still manage," Ledesma said.

The PhilHealth chief said the premium contribution of 5.78 million minimum wage earners to the state health insurer totaled P19.6 billion in 2022.

"Roughly P20 billion would be the foregone revenues, if we based it on these figures," Ledesma said.

Ledesma reiterated PhilHealth’s stand that the agency fully supports the move or “any move that will help the poor people, the indigents.”

“Definitely we will comply with whatever legislation will be pursued by the government,” he said, adding that “we’re also closely looking into it.“

Unspent gov't subsidy

In proposing to halt the collection of premiums from minimum wage earners, Quimbo said Congress appropriated P80 billion to subsidize PhilHealth premiums for indigent families, senior citizens, and persons with disability.

However, P24 billion of the subsidy remained unspent.

Quimbo added that Congress again appropriated P79 billion to subsidize PhilHealth premiums for indigent families, senior citizens, and persons with disabilities for 2023, but the state insurer had yet to spend P39 billion of the allotted funding.

The lawmaker also noted that PhilHealth's financial reserves were expected to reach P463 billion by the end of 2023 or a 68% increase from 2022.

“This surplus accumulated from premiums collected from members, as well as subsidies from Congress that have remained unspent, suggests that PhilHealth can afford to suspend premium contributions for minimum wage earners without compromising its stability,” Quimbo said. — VAL/ VDV, GMA Integrated News