PhilHealth owes gov't hospitals P14.8 billion in unpaid claims

MANILA, Philippines — Government hospitals are still awaiting P14.8 billion in unpaid claims from the Philippine Health Insurance Corp. (PhilHealth), the Department of Health (DOH) said on Wednesday, September 4.

Of this amount, about 45% or P6.7 billion has been overdue for at least two years. 

During the DOH's 12-hour budget hearing, lawmakers raised concerns about the lack of medical materials in government hospitals, which often forces patients to pay for needed supplies elsewhere. Health Secretary Teodoro Herbosa revealed that the delays in PhilHealth payments are a key factor contributing to these shortages.

“I have 87 hospitals under my wing and the total [amount of] things that I’m billing PhilHealth for is P14,864,894,065.02. That is the amount we are waiting to be paid,” Herbosa said.  

DOH explained that hospitals enter into a Memorandum of Agreement (MOA) with companies that could provide the medical supplies they need. However, Herbosa said that suppliers will withhold delivery of these materials if payments are delayed. 

“And that is why it is so important that PhilHealth pays immediately to the government hospitals as the payments from PhilHealth are delayed,” he said in a mix of English and Filipino. 

“Parang pinautang nila sa hospital yun for our indigent patients and we’re waiting for our cash, [but] our cash never comes. So, ang sasabihin ng consignee ay ‘Hindi kami magdedeliver.’ Ngayon, sasabihin sa pasyente na ‘Bumili ka doon sa nagsusupply ng bakal,’” he added.

(It’s like they put the burden on the hospital to pay for our indigent patients, and we’re waiting for the payment, but it never arrives. So, the supplier says, “We won't deliver.” Now, the patient is told, “You need to buy from the supplier.”)

If they have the money at hand to pay their consignees, Herbosa said that government hospitals would not run out of supplies. In turn, indigent and financially incapacitated patients would not have to experience delays in receiving medical care or be forced to seek alternatives due to shortages. 

According to PhilHealth’s President and Chief Executive Officer Emmanuel Ledesma Jr., the national health insurer has already paid hospitals around P74.9 billion in June. He added that “most of the hospitals’ associations, the heads and the doctors, are very happy with the improvements of the payments of claims of PhilHealth.”  

After lawmakers grilled PhilHealth for their unpaid claims, despite having a reserve fund of about P463.7 billion, Ledesma committed to paying the unpaid claims to DOH within 30 days.  

What led to the increase in reserve funds?

Rep. Stella Quimbo (Marikina City, 2nd District) said that two major reasons for surplus funds, which are included in the reserve fund, are the outstanding amounts owed to hospitals and the PhilHealth benefit packages that have not been enhanced enough.

Ledesma confirmed this and said it has been 12 years since there has been a significant increase in case rates and benefit packages. He added that the COVID-19 pandemic also contributed to the increase in the reserve fund.

At the same time, he said that the contribution rate has been increasing by 0.5% annually, as mandated by the Universal Health Care Act, until it reaches five percent. In February, PhilHealth raised the premium contribution rate to five percent.

“If you add those three, doon talaga 'yung main reason. I agree also with you that the payments to hospitals, ‘yung payments to claims [are part], but ako personally … I would put that more mas minimal ‘yun na reasoning,” Ledesma said. 

(If you add those three, that’s where the major reasons lie. I also agree with you that the payments to hospitals, and the payments to claims [are part], but I personally would consider that as a minor reason.)

As a result, PhilHealth promised lawmakers on Wednesday that they will raise benefit packages by an additional 30-50% before the year ends, bringing the total increase to 60-80% before 2025. The national health insurer last increased the benefit packages by 30% on February 14.