Philippine Health Insurance Corporation (PhilHealth).

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Type-Government-owned and controlled corporation

Industry-Health
Area served-Philippines
Key people
Celestina Ma. Jude P. Dela Serna, MD
(Interim President and CEO)
Services- Universal health coverage
Owner Department of Health
Website- www.philhealth.gov.ph
The Philippine Health Insurance Corporation (PhilHealth) was created in 1995 to implement universal
health coverage in the Philippines. It is a tax-exempt, government-owned and controlled corporation
(GOCC) of the Philippines, and is attached to the Department of Health. It's stated goal is to "ensure a
sustainable national health insurance program for all", according to the company.[1] In 2010, it claimed
to have achieved "universal" coverage at 86% of the population, although the 2008 National
Demographic Health Survey showed that only 38 percent of respondents were aware of at least one
household member being enrolled in PhilHealth.[2] Nevertheless, this social insurance program provides
a means for the healthy to pay for the care of the sick and for those who can afford medical care to
subsidize those who cannot. Both local[3] and national governments allocate funds to subsidize the
indigent.[4]

Contents

Mandate and Functions

In 2010 and 2015, reform efforts were outlined to make decentralization and health insurance work
more effectively, including an expanded government subsidy for the enrollment of the poor, the
creation of local health service delivery/planning units to reduce fragmentation, and a stronger DOH
role in regulation.[5] Also the shifting from Fee-for-service to Case Rate payment scheme and IHCP
Portal System is established to provide a link between accredited institutional health care providers and
Philhealth through online connections.

PhilHealth have six major membership categories covering nearly the entire population. Those who
count under the (1) "Formal" sector are workers employed by public and private companies and other
institutions. (2) "Indigents" also called "Philhealth sa Masa" are subsidized by National Government the
National Household Targeting System for Poverty Reduction. (3) "Sponsored Members" are subsidized
by their respective Local Governments (LGU). (4) "Lifetime" (non-paying members) are retirees and
pensioners and have already paid premiums for 120 months of membership and are 60 or older. (5)
"Senior Citizen" under RA 10645 that all citizen ages 60 years old above are eligible to have free
philhealth coverage. (6) The "Informal Economy" is composed of Informal Sectors, Self-Earning
Individuals, Organized Group, Filipino with Dual Citizenship, Natural-Born Citizen. Although treated
separately, the Overseas Filipino Workers (OFW) program or Migrant Workers is as part of the Informal
Economy. Migrant Worker is sub-categorized as whether Land Based or Sea Based (for Sea Fearers).
Since 1996, the benefits package and delivery system have improved. PhilHealth now has an Outpatient
and Diagnostic Package limited to indigent beneficiaries. This addition creates nearly comprehensive
coverage for indigents. In 2011, 23 CASE RATES was introduced and in 2013, ALL CASE RATES was fully
implemented. All other beneficiaries have access to nearly comprehensive services, excluding some
outpatient care. PhilHealth has an accreditation program for private hospitals.[6]

Some key reform indicators to date include:

Estimated coverage is 100% as of June 2013

Average period for payment of providers is estimated at 70 to 75 days. The law requires PhilHealth to
reimburse providers and/or members within 60 days. A recent move as of December 1, 2009,
implemented a “simplified reimbursement scheme” wherein 95% of the claims amount is reimbursed
after a rapid assessment of member and provider eligibility and the remaining 25% follows after detailed
review of the claims.

On average, 90 out of every 100 claims are paid, 3 to 4 are denied, and 6 to 7 are returned to health care
providers for more information. 28% of claims were submitted by public providers and 72% by private
providers.[7]

Funding and Revenues

Funding varies based on the population covered, although the majority of funds flow from general
taxation. Premiums from the formal sector reach up to 3% of monthly income. Premiums from both the
poor and the informal sector are 2,400 pesos annually (about 50 USD). However, the cost of insurance
for the poor is fully subsidized by the central and local governments. The National government allocates
more than 9 billion pesos annually to meet its target.[8]

Membership Category

Program summary [9][failed verification]

Group Premiums Enrollment Payment

Formal Employer and worker each pay half, up to 2.5% (maximum of 3%) of income up to 10,500 pesos
As of hire date 3 months

Indigent (NHTS) 2,400 pesos annually National Government None

Sponsored 2,400 pesos annually Local Government a fully subsidizes enrollment annually.
None

Lifetime Free lifetime coverage Retirees and Pensioners

Senior Citizen Non Paying (RA 10645), Free Lifetime coverage Age 60 years and up None

Informal 2,400 pesos annually for members earning P25,000 and below
3,600 pesos annually for members earning more than P25,000 Enrollment date.

OFW (Landbased) 2,400 pesos annually Emigration date No subsidy. Payment is on emigration
date then annually.

OFW (Seabased) Employer and worker each pay half, up to 2.5% (maximum of 3%) of income up
to 10,500 pesos As of hire date 3 months

All premiums are pooled nationally and in effect, there is cross-subsidization across districts. The
national government payment is dependent on the availability of funds.≤≤≤

Coverage

The benefits package is essentially the same for each membership category, philhealth deduction will
depend upon the final diagnosis. The exception is for indigents and Overseas Filipino Workers (OFWs)
who have additional outpatient primary care benefits (with the providers paid by capitation) however
these benefits are available only through public providers.

Benefits

PhilHealth and beneficiaries have access to a comprehensive package of services, including inpatient
care, catastrophic coverage, ambulatory surgeries, deliveries, and outpatient treatment for malaria and
tuberculosis. Those identified as indigent and OFW are also entitled to outpatient primary care benefits
(PCB1) or TSEKAP.[citation needed]

Inpatient care includes room and board, medicines, diagnostic and other services, professional fees and
operating room services under the "all case rate" payment scheme. The case rate amount will depend
upon the final diagnosis and each diagnosis has corresponding fix amount or package. The case rate
amount shall be deducted by the HCI from the member's total bill, which shall include professional fees
of attending physicians, prior to discharge. Catastrophic conditions, ambulatory surgeries including
ambulatory dialysis, deliveries and outpatient malaria and TB-DOTS care.

Outpatient benefits include day surgeries, radiotherapy, dialysis, outpatient blood transfusion, TB-DOTS,
malaria treatment, HIV/AIDS treatment, animal bite treatment, cataract operations and vasectomy and
tubal ligation.

Except for the outpatient primary care benefits (PCB1) that the indigents and OFWs are entitled to via
public providers, patients have free choice of providers, both public and private.

Annual or lifetime coverage limits exist. These limits are expressed in terms of volumes of services (e.g.,
days) rather than a peso coverage limit. For example, principal member are eligible for 45 days of
inpatient admission and also outpatient, and another 45 days to share among its qualified dependents.
Each day of ambulatory surgery counts as a day of admission.

Providers are allowed to charge the patient the difference between the total cost of care and what
PhilHealth pays (i.e., balance billing).
Indigent and sponsored members, lifetime members, senior citizen members and household members
are entitled to avail the free hospitalization under the no-balance billing scheme (NBB) when they are
admitted in a non-private room of public or government hospitals. NBB are not applicable under private
rooms and private hospitals so members have to pay the excess or balance after case rate amount has
been deducted.

Service delivery system

The service delivery system includes both public and private centers; on average, 61% of the network's
providers are private and 39% are public. In order to achieve accreditation, all in-network hospitals and
day-surgery centers must be licensed by the Department of Health.

The network includes hospitals, day surgery centers, maternity care clinics, midwife-operated clinics,
freestanding dialysis centers, physician clinics, dentists doing procedures in hospitals and day surgeries,
government-run health centers for primary care benefits, TB-DOTS and malaria, and private TB-DOTS
clinics.

Non-hospitals and day-surgery centers are not required to be licensed by the DOH; however, all facilities
are evaluated by an accreditation team from PhilHealth.

Structure

The scheme is entirely administered by PhilHealth, a government corporation attached to the

Department of Health. PhilHealth collects premiums, accredits providers, sets the benefits packages and
provider payment mechanisms, processes claims, and reimburses providers for their services.

PhilHealth is responsible for oversight and administration of public sector insurance schemes. It has a
governing board chaired by the Secretary of Health with representation from other government
departments (ministries) and agencies, and the private sector including the OFW sector.

PhilHealth has a governing board of 13 individuals, chaired by the Secretary of Health, with the
President and CEO of PhilHealth as Vice-Chair. While the law, RA 7875, that created the National Health
Insurance Program provides that the President and CEO has a fixed term of 6 years, with the passage
Republic Act 10149 or the "GOCC Governance Act of 2011," the President and CEO of PhilHealth now
has a term of one (1) year (Section 17, RA 10149) to be elected among the ranks of the Board of
Directors and subject to the disciplinary powers of the Board and may be removed for cause (Section 18,
RA 10149).

Salaries and other operating expenses are derived from premium payments and the income of the funds
under management. PhilHealth can use up to 12% of the previous year’s premium and 3% of the income
of the fund it manages towards operating expenses.

Congress mandated that the National Institutes of Health (based at the University of the Philippines
Manila) to conduct studies to verify and validate performance.
Provider Payment Mechanism

Provider payment methods differ based on the illness or diagnosis. Case Rates are used for inpatient
care, most day surgeries, and ambulatory procedures, TB-DOTS treatment, malaria care, deliveries,
surgical contraception, and cataract surgeries, while primary care benefits providers are reimbursed
based on a capitation system.

No formal system sets deductibles or co-payments for beneficiaries, but health care providers are
allowed to “balance bill”, charging patients the balance between what PhilHealth pays and the total cost
of care. This is atypical of most government health programs around the world and can lead to abuse by
providers (e.g., overcharging) and thus limited access for the poorest. At the same time, balance billing
allows providers additional cost recovery in the case that the reimbursement for services does not cover
their cost.

Quality

PhilHealth currently leverages internally developed quality standards. A new set of standards called the
“PhilHealth Benchbook” was implemented starting January 1, 2010. The Benchbook was developed by
PhilHealth with the assistance of various international health partners and several rounds of
consultations with health providers.

The previous and new quality standards are overseen by PhilHealth. The new quality standards focus on
patient rights, organizational ethics, patient care, leadership and management, human resource
management, information management, safe practice and environment and mechanisms of improving
performance. As of 2011, hospital accreditation is valid for up to 3 years. PhilHealth accreditation staff
physically check and verify compliance. PhilHealth has peer review committees mostly composed of
health care providers who review specific cases.

PhilHealth planned to implement quality-based purchasing but had not executed on this plan as of
December 2009.

Performance-based Payment

PhilHealth has been developing incentives focused on payment to health care professionals. Doctors are
usually independent practitioners who ‘practice’ in hospitals. Salaried government physicians are
allowed to also engage in private practice. Efforts to implement case payments essentially focus on
bundling the payment for the health facilities.

Among PhilHealth’s work in incentive-based payments is a scheme that has been piloted in 30 local
government hospitals since 2002 but has not spread. The scheme is called the Quality Improvement
Demonstration Study (QIDS). It utilizes clinical vignettes to measure quality of care. If a hospital meets a
set quality of care index score, physician payments are increased. Clinical vignettes focus on the illnesses
of children less than six years of age.
Another incentive scheme is increased payment for health professionals practicing in areas where there
is a lack of doctors.

Claims Processing

Claims processing and availment in accredited hospitals has been improved. Hospitals have installed the
ICHP Portal System. It is established to provide a link between accredited institutional health care
providers and Philhealth through online connections that shall ensure verification of eligibility
information.[10] Members do not need to fill out forms if member have updated premium contributions
and updated philhealth records, they will have to present their philhealth IDs. Claims are submitted to
17 regional claims processing centers. These centers initially review claims for eligibility. Review is input
manually with data encoded into the claims processing information system. Once the claim is approved
for payment, checks are prepared for the signature of regional heads. Electronic reimbursements are
planned but has yet to be implemented.

Monitoring and Evaluation

PhilHealth conducts its own monitoring and evaluation, though the law mandates that University of the
Philippines National Institutes of Health engages in monitoring of the scheme. Evaluations on the
PhilHealth program are ongoing.

The Department of Health (to which PhilHealth is an attached agency) monitors and analyses data,
including number and value of claims, number of accredited providers, number and value of premiums
paid, number of members, etc.

Fraud and Controversies

In 2013 fraudulent claims Juan Miguel of Regional 1 started fire with against the state-health insurer
were estimated at 4 billion pesos. However, the state failed to prosecute erring doctors, private and
public hospitals, and public officials. AFP Medical Center, St. Luke’s Hospital, Philippine Orthopedic
Hospital, University of Sto. Tomas Hospital, East Avenue Medical Center, Cardinal Santos Medical
Center, Medical City, National Kidney and Transplant Institute, General Santos Doctors Hospital (GSDH)
were investigated for health insurance fraud.[11] In Iloilo, eye-doctor claims for 2, 071 operations in
2006 amounting to PHP16 million in professional fees were also investigated. A hospital in Davao City
also noticed that a janitor, not a PhilHealth member, had been lying in bed to claim benefits as a
PhilHealth-accredited patient.[12] Also in 2006, PhilHealth revoked the accreditation of Sara Medical
Clinic in Midsayap for admitting ghost patients.[12] 2018, A lawmaker was shocked to find out that
Philhealth interim president Celestina Dela Serna spent one year living at a hotel worth P3,800 per night
instead of renting a condominium unit or apartment in Metro Manila. Negros Oriental Rep. Arnulfo
Teves said he and House Speaker Pantaleon Alvarez had the chance to talk to Dela Serna during an event
at the House of Representatives, and they were appalled at her extravagant lifestyle. “She admitted to
staying in the hotel for one year or more… More or less one year sa hotel siya nakatira charged to
Philhealth and she said she thought it was okay, that’s why she did it,” he said. Teves said Dela Serna
told him and Alvarez that she stayed at Legend Villas, where rooms are worth at least P3,800 a
night.[13]

History

The Philippine Medical Care Program began in 1971 following the Philippine Medical Care Act of
1969.[14] It mandated creation of the Philippine Medical Care Commission (PMCC). In 1990, bills were
passed that led to significant improvement of public health care insurance. House Bill 14225 and Senate
Bill 01738 became Republic Act 7875, known as "The National Health Insurance Act of 1995". Approved
by President Fidel Ramos on February 14, 1995, this become the basis of the Philippine Health Insurance
Corporation.[15] On its 16th anniversary, the song "PhilHealth: Tapat na Serbisyo, Tapat na Benepisyo,
Lahat Panalo" was introduced.[16]

References

"R.A. 7875 AN ACT INSTITUTING A NATIONAL HEALTH INSURANCE PROGRAM FOR ALL FILIPINOS AND
ESTABLISHING THE PHILIPPINE HEALTH INSURANCE CORPORATION FOR THE PURPOSE" (PDF). Archived
from the original (PDF) on 2011-09-04. Retrieved 2011-07-06.

Niel Lim, INCITEGov and VERA Files. "'Conservative' and 'sluggish' PhilHealth misses healthcare target".
GMA News. Retrieved 2011-07-06.
Balana, Cynthia (2010-09-29). "PhilHealth doubles premiums". Philippine Daily Inquirer. Archived from
the original on 2010-10-01. Retrieved 2011-05-06.
"PREMIUM SUBSIDY FOR INDIGENTS UNDER THE NATIONAL HEALTH INSURANCE PROGRAM" (PDF).
Department of Budget and Management. Archived from the original (PDF) on 2011-09-28. Retrieved
2011-05-06.
Crisostomo, Sheila. "Phl eyes Mexico as model for PhilHealth expansion". The Philippine Star. Retrieved
2011-07-07.
"Get to know your PhilHealth benefit in just one click". January 30, 2015.
"Based on 2008 claims reports". PhilHealth website. December 2008.
"Extending Health Care to all Filipinos". Retrieved 2011-07-07.
"DOH sets massive, open PhilHealth registration". Retrieved 2011-07-07.
"Guidelines on the ICHP Portal" (PDF).
Espejo, Edwin (May 26, 2011). "Philippines: How to cure PhilHealth's woes?". Asian Correspondent.
Newsbreak. Archived from the original on October 9, 2011. Retrieved 2011-07-06.
Espejo, Edwin (May 25, 2011). "Bogus claims haunt PhilHealth". Newsbreak. Retrieved 2011-07-06.
"Buhay reyna! PhilHealth chief Dela Serna spends a year living in P3,800 per night hotel". Politiko. June
1, 2018. Retrieved March 27, 2019.
"REPUBLIC ACT No. 6111". Law Phil. Retrieved 2011-07-07.
"Philippine Health Insurance Corporation celebrates 15th Anniversary". 2010-10-01. Retrieved 2011-07-
07.
"PhilHealth Corporate Profile". Archived from the original on 2011-07-20. Retrieved 2011-07-07.