Health Secretary Francisco Duque III. Screengrab from Senate livestream/FILE
MANILA, Philippines — Sen. Panfilo Lacson on Wednesday said it was “cruel” for hospitals being operated by the Department of Health (DOH) to retain billions in income derived from patients paying for their medical care amid the raging COVID-19 pandemic.
He was dismayed that these hospitals’ “off-budget incomes” and their expenditures did not cancel each other out, an indication that they were making profit from their operations.
“It doesn’t make sense to me, Mr. Secretary, that you cannot spend your off-budget account, and yet you are still punishing our patients by collecting or billing them especially during COVID when so many have lost their jobs,” he told Health Secretary Francisco Duque III during a budget hearing.
The DOH and its attached agencies are seeking a budget of P242.2 billion for 2022, 14 percent more than its 2021 funding of P212 billion.
According to Duque, the DOH would give priority to the implementation of the Universal Health Care Act, with proposed funding of P59.15 billion, as well as measures to contain the spread of COVID-19, with funding of P19.68 billion.
‘Issue of conscience’
Citing the Budget of Expenditures and Sources of Financing (BESF) from 2016 to 2022, Lacson asked why the DOH “off-budget accounts” indicated that government hospitals derived income from medical fees.
Off-budget accounts under the BESF reflect the income held by the DOH which comes from fees, payment for medicines, rents or leases, seminar or training fees, and other charges by the hospitals that it continues to operate after the devolution of health services to local governments.
“I find it rather cruel for government hospitals to be charging patients when in fact, they retain huge amounts in their off-budget accounts,” Lacson said.
Records show that the retained off-budget earnings by the DOH amounted to P4.8 billion in 2016, P9.1 billion in 2017, P6.2 billion in 2018, P7.7 billion in 2019, and P8 billion in 2020.
“Should there not be an issue of conscience here? We’re not fully using the budget, yet, we’re charging patients,” Lacson said.
Duque agreed with Lacson that the off-budget incomes and expenditures should have canceled each other out, and promised to discuss the matter with other DOH officials.
Duque also clarified that a P448-billion income cited by Lacson was from an erroneous report by Eastern Visayas Medical Center in Tacloban City, which should have posted a projected income of P448 million, not billion, in 2021.
He said that for 2021, the DOH off-budget income was P21.3 billion. Duque said that he would ask the Department of Budget and Management to rectify the error in the 2022 BESF.
Senate Minority Leader Franklin Drilon asked what would happen to the huge sums, who would authorize how and where they would be spent, and how would the money be reported in the books of account.
Drilon believed that these DOH-operated hospitals were being run like government-owned and controlled corporations which treated their incomes as “corporate funds.”
Special GAA provision
“Whether or not this is authorized in the budget, this is a huge amount that it becomes inappropriate given the pandemic that we have today; it is really unjustified to continue this assuming this is true,” Drilon said.
Lacson cited a special provision in the 2021 General Appropriations Act, which mandates that “all income generated from the operation of [government hospitals] … shall be deposited in an authorized government depository bank and used to augment the hospitals and other health facilities’ (maintenance and other operating expenses) and capital outlay requirements.”
“So, this leads me to speculate: Are these funds being kept in banks to let them earn interest?” he said.
Review policies
A government hospital’s earnings should be spent in a manner that would fulfill its mandate of providing a “people-centered” healthcare system, Lacson said.
Still, there are many cases of patients who must cough up huge sums for their hospital bills, and are often forced to seek the help of politicians, he said. “But what happens to those who do not know any senator or congressman?” he said.
The DOH should review its policies governing off-budget accounts, Lacson said, adding that the retention of the hospitals’ incomes indicated a problem in the management of government hospitals.