Hospitals oppose hike in elderly discount from 20% to 30%

Private hospital owners opposed yesterday a pending bill in the House of Representatives that seeks to increase the discount privilege of senior citizens.

House Bill No. 677 proposes to raise the discount privilege of elders from 20 percent to 30 percent.

In a letter to Rep. Reynaldo Uy, chairman of the House Committee on Population and Family Relations, Dr. Rustico Jimenez, president of the Private Hospitals Association of the Philippines (PHAP), said the resources of hospitals would be drained if the bill is passed.

“PHAP would be in favor of this House bill if there would be a corresponding fund that would compensate for the additional discount that the hospital or healthcare facility would extend to senior citizens,” Jimenez said.

Jimenez claimed that private hospitals incorporate a certain margin in their pricing scheme to cover the departments that are considered “cost centers.”

“Departments such as the linen and laundry, housekeeping, dietary, maintenance and other support units do not earn revenues but still incur expenses in the performance of their day to day functions.” 

He said so-called “revenue centers” such as the diagnostic units and pharmacy should be able to recover the expenses of the support units.

Jimenez warned the congressmen that if the discount to senior citizens was increased further, the margin earmarked to cover for the cost of non-revenue earning units would be reduced.

“The effect is quite substantial since senior citizens avail of hospital services more than the other age groups,” Jimenez said.

He cited a “quick survey” of the monthly utilization of basic medical services in a hospital in January 2008, showing that of the 511 pulmonary patients that underwent aerosol therapy, 222 were senior citizens.

The elders also comprised 399 of the 701 patients that underwent X-ray procedures and 89 of the 166 patients that had ultrasound.

“Given the composition of service utilization illustrated, the additional discount to senior citizens would considerably reduce the income of the hospital. The hospital may recover some of the costs by considerably increasing its rates but the prices might already be prohibitive to most of its patients,” Jimenez maintained.