EDITORIAL - Cut premiums, or return the P89.9 B

Before people start rejoicing over a possible reduction in their contributions to the Philippine Health Insurance Corp., they should contend with opposition particularly from those who insist on impounding P89.9 billion in supposedly unused PhilHealth funds.

Last Tuesday, PhilHealth president and CEO Emmanuel Ledesma Jr. told a Senate panel that he would convene his team immediately to recommend a cut in members’ contributions. Sure enough, the move was opposed by Finance Secretary Ralph Recto, who continued to defend the circular impounding the “savings” of government-owned and controlled corporations or GOCCs.

Recto said yesterday that he preferred to improve benefit packages for PhilHealth members rather than to cut the contributions. But that P89.9 billion would go a long way in improving health benefit packages, and in paying the PhilHealth claims of private hospitals. So why is the money being impounded?

Many people were surprised to learn that PhilHealth is a GOCC like the revenue-earning Philippine Amusement and Gaming Corp. And many people were dismayed that the impounded “savings” of PhilHealth, which never seems to have enough funds to provide decent health care to its members, would be used to finance unprogrammed appropriations in this year’s national budget.

Unprogrammed appropriations, the new version of the congressional pork barrel, can be funded only through new or higher taxes. For this year, Congress padded the amount originally proposed by the executive for unprogrammed appropriations by a whopping P449.5 billion – from P281.9 billion to a hefty P731.4 billion. With no new or higher taxes planned, those behind this padding scrounged around for a new funding source. Congress’ bicameral conference committee then inserted a last-minute provision in the 2024 General Appropriations Act, allowing the impounding of “excess” GOCC funds to finance their pork barrel.

Critics have pointed out that the “rider” in the GAA along with the Department of Finance circular effectively amended all the laws creating each GOCC including PhilHealth. This faces a legal challenge before the Supreme Court. By law, PhilHealth excess funds can be used only to expand services or reduce members’ contributions. The state health insurer is going for the second option. It’s either this, or the return of that P89.9 billion to PhilHealth.