MANILA, Philippines — The head of the Philippine Health Insurance Corp. (PhilHealth) on Tuesday revealed that the country’s health insurer’s “financial position will be very grim” next year since the coronavirus pandemic reduced the payment capacity of its direct contributors.
PhilHealth President and CEO Ricardo Morales raised this concern during Tuesday’s joint congressional committee meeting on updates on the implementation of the Universal Health Care (UHC) Act.
“Pagdating ho ng next year, delikado na ho. Our financial position will be very grim. Because we were advised by the DBM (Department of Budget and Management) that ‘yung government subsidy for next year will remain at the same level as 2020 [at] P71 billion,” Morales told legislators.
(By next year, it will be critical. Our financial position will be very grim. Because we were advised by the DBM that the government subsidy for next year will remain at the same level as 2020 at P71 billion.)
The said amount was around P80 billion lower than PhilHealth’s proposed subsidy for 2020, which was a little over P153 billion.
READ: PhilHealth: 2020 subsidy ‘not enough’ to fund premium of all indirect contributors
“Ang sinabi naman ho kanina ni Senator (Richard) Gordon na ‘yung sin tax collections ho ay bumagsak, dun ho kasi tayo umaasa ng premium collection na binabayad sa subsidy. At ‘yung mga direct contributors ho, katulad ng mga employers at ‘yung mga self-employed, since wala hong negosyo bumagsak din ho ‘yung kanilang pay capacity,” he added.
(Senator Gordon earlier said that sin tax collections have dropped, we are relying on the premium collection on that for the provision of subsidy. And then our direct contributors, like employers and those who are self-employed, since businesses are closed, it reduced their pay capacity).
“So we are really facing a grim picture come 2021,” he further said.
Earlier in the congressional meeting, Gordon flagged the drop in sin tax collection, which was eyed to augment funds for the implementation of the UHC law.
Meanwhile, Morales noted that PhilHealth saw a significant drop in contribution collections from both its direct and indirect contributors amid the pandemic.
READ: PhilHealth seeks to defer UHC implementation, expansion of care benefits
“Originally, we are already forecasting a net loss for 2020 because we received half of what we originally asked for but that was even before COVID,” the PhilHealth chief said.
“Ngayon pp (Now) with COVID, we are projecting a deeper loss. So our reserves are going to take a hit and we forecast that we will be able to meet ‘yung mga (those) benefit payment requirements even if including COVID for the entire year of 2020,” he added.
Despite this, Morales said PhilHealth “is trying everything” it can in order to conserve its resources so it could meet the health requirements of the Filipino people.
“That is the prospect as of now, but of course we are trying everything we can to try to husband our resources, to conserve our resources to be able to meet the health requirements for our citizenry,” he said.
“We are still holding it together so far. ‘Yun ho ang sitwasyon PhilHealth,” he added.
(That is the situation of PhilHealth).
‘Budget pressures’
Asked about concerns raised by PhilHealth, DBM division chief Johnry Castillo assured that the state health insurer will be given “preferential attention.”
“Currently the 2021 budget preparation is ongoing. I heard based on the series of meetings of the economic managers that they will be given preferential attention. However, this will be subject to the collections, the available fiscal space for 2021,” Castillo told the committee.
Just like what Morales said, Castillo noted that PhilHealth will be given an initial P71 billion under the 2021 budget proposal.
But the DBM official said the amount would still be subject to change.
“We cannot say for sure if this will be increased because it’s still undergoing deliberation by the economic managers. Probably when we submit for discussion during the executive review board, this situation by PhilHealth will be taken duly into consideration,” Castillo explained.
He added that PhilHealth and the Department of Health are among the “budget pressures” for 2021 “because of the fight against COVID-19 pandemic.”
“But definitely, we cannot say for sure now na (that) P71 billion na lang (is left) [for PhilHealth] because it is still undergoing the usual budget preparation deliberation,” Castillo further noted.