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UNIVERSITY OF THE PHILIPPINES
VISAYAS TACLOBAN COLLEGE
TACLOBAN CITY
PHILIPPINES HEALTH IN PHILHEALTH:
EXTENDING HEALTH INSURANCE TO INDIGENT FILIPINOS
MANAGEMENT 243
PROGRAM DEVELOPMENT
APURILLO, SHERYL Y.
GAYAS, IMELDA M.
HURTADO, ADOR L.
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CHAPTER I
INTRODUCTION
The struggle against disease has progressed considerably over the years. Health
conditions in the Philippines in 1990 approximated to those in other Southeast Asian countries
but lagged behind those in the West. Life expectancy, for instance, increased from 51.2 years in
1960 to 69 years for women and 63 years for men in 1990. Infant mortality was 101 per 1,000 in
1950 and had dropped to 51.6 per 1,000 in 1989. In 1923 approximately 76 percent of deaths
were caused by communicable diseases. By 1980 deaths from communicable diseases had
declined to about 26 percent.
In 1989 the ratio of physicians and hospitals to the total population was similar to that in
a number of other Southeast Asian countries, but considerably below that in Europe and North
America. Most health care personnel and facilities were concentrated in urban areas. There was
substantial migration of physicians and nurses to the United States in the 1970s and 1980s, but
there are no reliable figures to indicate what effect this had on the Philippines. Hospital
equipment often did not function because there were insufficient technicians capable of
maintaining it, but the 1990 report of the Department of Health said that centers for the repair
and maintenance of hospital equipment expected to alleviate this problem.
In 1987 a little more than one-half of the infants and children received a complete series
of immunization shots, a major step in preventive medicine, but obviously far short of a desirable
goal. The problem was especially difficult in rural areas. The Department of Health had made
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efforts to provide every barangay with at least minimum health care, but doing so was both
difficult and expensive, and the more remote areas inevitably received less attention.
A. RATIONALE
The Philippines has a dual health care system consisting of modern (Western) and
traditional medicine. The modern system is based on the germ theory of disease and has
scientifically trained practitioners. The traditional approach assumes that illness is caused by a
breach of taboos set by supernatural forces. It is not unusual for an individual to alternate
between the two forms of medicine. If the benefits of modern medicine are immediately obvious-
-eyeglasses, for instance--then there is little argument. If there is no immediate cure, the impulse
to turn to the traditional healer is often strong.
The Philippines had a social security system including medicare with wide coverage of
the regularly employed urban workers. It offered a partial shield against disaster, but was limited
both by the generally low level of incomes, which reduced benefits, and by the exclusion of most
workers in agriculture. In April 1989, out of more than 22 million employed individuals, a little
more than 10.5 million were covered by social security. In health care and social security, as
with other services, the Philippines entered the 1990s as a modernizing society struggling with
limited success against heavy odds to apply scarce financial resources to provide its people with
a better life.
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B. PHILHEALTHS HISTORY
The basic right to health is mandated by the International Covenant for Economic, Social
and Cultural Rights promulgated by the United Nations. In the Philippines, the Philippine Health
Insurance Corporation (PhilHealth) has pushed for the coverage of the largely under- and un-
employed persons in the poorest of communities through a partnership with the local government
units (LGUs). At the core of that partnership is an arrangement that encourages LGUs to enroll
heads of indigent families to the PhilHealth system. Ten years after its institution, some four
million indigents have been enrolled under PhilHealth, mostly heads of families, thus effectively
covering about 20 million individuals.
The PhilHealth Indigent Program was established in the context of the countrys
worsening poverty situation, decentralization and the establishment of the Philippine Health
Insurance Corporation (PhilHealth) to take the lead in implementing the countrys National
Health Insurance Program.
In 1969, the Philippine Medical Care Act (Republic Act No. 6111), known more widely
by its acronym, Medicare, provided for increased medical care benefits mostly to the regularly
employed, particularly those also covered by the Government Service Insurance System (GSIS)
for public employees and the Social Security System (SSS) for private sector employees. It failed
to cover the larger sections of the population who were unemployed, underemployed or
employed by the so-called informal sector: essentially the poor. The Medicare law was replaced
by the National Health Insurance Act (NHIA) of 1995, which modified the Medicare system
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with the creation of the Philippine Health Insurance Corporation (PhilHealth) to administer a
new setup designed to expand coverage to previously un-served sectors. The NHIA also
established the National Health Insurance Program, to be implemented by the PhilHealth, with
the mandate to provide all citizens with the mechanism to gain access to health services in
combination with other government health programs
In 1995, the Philippine Health Insurance Corporation or PHIC was created to administer
a National Health Insurance Programme which aims to provide all citizens of the Philippines
with the mechanism to gain financial access to health services and to serve as the means to
help people pay for health care services.
First among the guiding principles declared in the National Health Insurance Act is the
state policy to provide free medical care to paupers (Article I Section 2). It is therefore
explicit from the law that the National Health Insurance Programme aims to achieve coverage of
the entire population with at least a basic minimum package of health insurance benefits - and
with the priority of the underprivileged explicitly recognised. The word entire population
needs to be emphasised at this point, if only to remind us that when the law was crafted, the
framers of the law clearly had in their minds from the very start the intention to cover the entire
population from the highest to the lowest rungs of the society.
PhilHealth had been given 15 years to attain universal coverage with utmost priority
given to the poor as they are the ones who need health insurance coverage the most. This is the
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central theme of this paper how PHIC has progressed in making available to the indigents the
benefits of social health insurance financed through premium subsidies.
C. PROGRAM FOR INDIGENT FILIPINOS
Access to health is the most pressing concern of most households. During adverse
changes in economic conditions, it is not the lack of food, but access to health services and
medicines that figures prominently among households concerns, especially among the poor.
Faced with a serious debt problem, the government can account for only 38 percent of
expenditures in health services. Most health expenses are shouldered by the private households
(55 percent). Private and state health insurance cover only 2 percent and 5 percent, respectively.
With the poor, especially the unemployed and under employed among the most
vulnerable to adverse situations, better ways of making health services accessible to them
became, and even now remains, a major challenge. With public health service delivery functions
now devolved, that challenge falls squarely on LGUs. Unfortunately many are as hard put as the
national government, with devolved funds not quite matching the cost of devolved (especially
health) functions. It is this situation that the PhilHealths Indigent Program, with its component
capitation scheme, was designed to address. The government saw the health insurance system,
particularly the public health insurance system as its main tool for ensuring the poors access to
quality health services. However, fully cognizant of the LGUs financial and health service
delivery limitations, a scheme had to be devised to encourage local governments to use the health
insurance system for its poorest constituencies.
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At the time the PhilHealths Indigent Program was conceptualized in 1997, less than 26
percent of the population (about 22 million) was covered by health insurance, of which the
PhilHealth accounted for close to 90 to 95 percent. The overwhelming majority of those covered,
estimated at more than 95 percent were regularly employed personnel from the government and
private sectors, and their beneficiaries. Some 34,000 cooperative societies also provide insurance
services to the poor. A study conducted by the International Labor Organization estimated that
only 1.25 million were beneficiaries of some 935,600 documented micro insurance schemes in
the Philippines. Of these schemes, only a handful involves the provision of health insurance
services. Considering that members of poor families number close to 20 million, much needed to
be done in terms of health insurance coverage.
The NHIA was conceived in the light of frustration over the earlier Medicare system and
the need to expand the health care insurance system to cover those who are not regularly
employed. An expanded system, coupled with decentralized government was thought to be an
effective way of delivering health services to those who needed the services the most. This was
the germ of the idea communicated to members of Congress who eventually enacted the NHIA
law. The support of the LGUs through their Leagues had to be mobilized, to make the intent of
the law a reality. There was need for LGUs to invest in improvements in local health facilities
and services. For lack of funds, devolved facilities had not been properly maintained and
managed.
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In its initial stages, PhilHealths Indigent Program had to ride on the implementation of
President Ramos Social Reform Agenda which listed twenty poorest provinces, dubbed as
Club 20 as priority sites for implementation. In this manner, the Indigent Program gained the
support of the highest office of the country. At the start, only two provincial LGUs actively
patronized the program although all twenty had entered into Memoranda of Agreement with the
PhilHealth. Initial successes however led to more buy-ins from LGUs, especially as the
Capitation Scheme went into full implementation. The Program had (and continues to have) the
support of various levels of government as well as of a growing number of private entities.
Support from the legislative branch eventually translated into the passage of the NHIA of 1995,
including provision for a Capitation Scheme which comprises an important component of the
incentives package to entice LGUs to invest in health. The Congress and Senate have
continuously supported the program as evidenced by growing appropriations from an initial P500
million (US$10million) to the current P3.5 billion (US$70 million). In addition, legislators from
both the Senate and Congress set aside amounts from their Countrywide Development Funds to
support the Indigent Program.
The Department of Health (DOH) has been at the forefront of the advocacy work for the
PhilHealth Indigent Program, especially among LGUs. Its regional offices provide various kinds
of training in the field of effective health care and public health management. The strongest
support however has been from the LGUs: the provincial governments with their provincial and
district hospitals; the city and municipal governments with their Rural Health Units (RHU) and
City Health Centers (CHC); the barangay (village) which actively assist in seeking out indigent
families, The LGUs provide the funds to pay for the insurance premiums of indigent families.
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From the original two provinces that initially joined the program, today there are close to 200
provinces, municipalities and cities participating. Besides the premiums, LGUs have taken
advantage of the Capitation Scheme to improve their health facilities, many bringing these to par
with accredited private health service providers much to the advantage of the poor who can often
fully afford only the services of public facilities even with their insurance coverage. LGUs have
adopted central administrative and operating systems in which funds are managed in such a way
that revenues from health operations are earmarked for more health service delivery for the poor.
Within the private sector, hospitals have supported the indigent program by ensuring high quality
service for indigents, upgrading their overall capabilities, systems and equipment, and enrolling
and properly participating in the system. Certain civic organizations and foundations, especially
corporate foundations, have been mobilizing funds to augment the counterparts either of
PhilHealth or of the LGUs. Some of these private sector sponsoring entities assume the role of
LGUs in sponsoring indigent families for the latters enrollment in the system.
D. DEFINITION OF TERMS
The following terms have been used in this paper:
Beneficiary Any person, who benefits from the program and is used interchangeably as to the
member himself/herself or any of his/her dependents.
Corporation The term is used interchangeably with PhilHealth or Philippine Health Insurance
Corporation
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Indigent - An indigent or sponsored member refers to a member with no visible means of income
or whose income is insufficient for the subsistence of the family, as identified based on the
specific criteria set by the Corporation.
Healthcare Providers Refers to entities or institutions such as rural health units, hospitals, and
clinics accredited to deliver services to PhilHealth members and may also refer to the actual
individuals providing healthcare services.
Household Refers to a family, with parents and children and is used as a collective identity.
Member Person actually enrolled in the Program, whose name appears in the identification
card issued by PhilHealth.
Program Refers to the actual PhilHealth Indigent Program and is used synonymously with
Sponsored Indigent Program.
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CHAPTER II
INTO DEEP: PHILHEALTHS INDIGENT PROGRAM
The NHIA that created the PhilHealth states among its guiding principles, that the
government shall be responsible for providing a basic package of needed personal health services
to indigents through premium subsidy, or through direct service provision until such time that the
program is fully implemented. Created to operationalize this mandate, the PhilHealth Indigent
Program seeks to cover more indigents of the country to ensure access to quality health care
services, and to eventually wean them from dependence on the program by helping them raise
themselves from their very status of indigence.
A. GOALS
The PhilHealth Indigent Programs goals are:
First, to sustainably provide increasing access to health care systems, both
preventive and curative, through health care financing for all indigents, specifically for
the most vulnerable sectors, like the women, children, senior citizens and the physically
infirm among the indigents. Second, to enable indigents to save what they would
otherwise be spending for health care and use these savings as new capital for small-scale
entrepreneurship that would create for them the opportunity for upward social mobility.
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The program seeks to provide necessary assistance to the LGUs for their indigent
constituents effective accessibility of such basic services while these LGUs capability
for full self-reliance for upgraded health care services has yet to be attained. Helping the
LGUs perform well on the devolved mandate for health care service provision has been
this Programs distinct service and contribution to the historic decentralization and
localization process spearheaded by the enactment of the Local Government Code. The
timeframe for the full implementation of the Indigent Program is 15 years after which the
country should have achieved universal health coverage of the countrys indigent
population.
B. PROGRAM KEY ELEMENTS
Certain attributes make up the key components of the PhilHealth Indigent
Program. First and foremost, the program is sharply focused on serving and uplifting the
poorest of the poor through provision of quality health service. Secondly, it seeks to
achieve this through a strong partnership with LGUs. Third, the program provides an
effective incentive scheme to encourage LGUs to invest in health facilities and service
delivery. Finally, as mentioned earlier, the program endeavors to eventually wean the
indigent enrollees from dependence on the system by enabling them to attain upward
social mobility. In this connection, the program has started building partnerships with
cooperatives and other enterprise-oriented organized groups to take over assisting their
members to move from indigence to stable income status within the informal sector.
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1. Target Beneficiaries
Households whose members have a per capita income of P11, 500 (US$250)
per annum or lower, are eligible for coverage. These households are identified by
the LGU through their social welfare officers and barangay (village) officials. The
PhilHealth assists in the selection process. The program is open to all provinces,
cities and municipalities willing to shoulder premiums and improve the level of
health service delivery to their poorer constituents.
2. Two Modes of Paying for Health Services
The Capitation Scheme
Briefly, the Indigent Program keeps a list of enrolled indigents per locality
per year, and serves these enrollees in two ways. One way is through free out-
patient treatment of indigents at the municipal RHU or the city CHC. These
RHUs and CHCs however, need to be accredited as a PhilHealth facility to insure
that the service and supplies delivered are of acceptable quality. The Indigent
Program uses the Capitation Scheme to fund out-patient services of RHU/CHC
facilities and for other purposes as the recipient LGU may decide. Under this
scheme, the PhilHealth pays the sponsoring LGU P 300 per year of indigent
enrollment. The amount is released by the LGU to the RHU/CHC where the
enrolled families are listed. The said RHU/CHC may use the fund to buy essential
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drugs, acquire supplies and materials critical to effect delivery of primary health
care services and pay for referral fees. This result in improved capabilities and
quality of service of the health care facilities. Some LGUs have been able to
purchase critical medical equipment or completely re-furbished medical facilities
using capitation funds received and accumulated. The key to this Scheme
however is that the LGU is enticed to improve its facility and service delivery
system to a level where it becomes eligible for accreditation by PhilHealth. As an
accredited health service provider, the RHU/CHC may then serve individuals
(including non-indigents) who have PhilHealth coverage. Otherwise, the indigent
family has to be served by an accredited private health service provider.
Reimbursement of Hospital Expenses
The second way is through reimbursement by PhilHealth of
hospitalization expenses of the enrolled indigents. As in the case of the RHUs and
CHCs, the hospital used must be an accredited facility. Indigents needing tertiary
level care are referred to an accredited hospital by the RHU or CHC as the case
may be. The PhilHealth reimburses a substantial portion of enrolled indigents
hospital bills, professional fees and medicine expenses. This usually ranges from
50% to 80% on ward rates.
3. Inter-LGU Cooperation in Health Realized Through the PhilHealth Indigent
Program
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LGUs have the primary responsibility of providing health care services for
their constituents. The municipal and city governments, with their RHUs and
CHCs are officially responsible only for primary health care, but enrolment in the
National Health Care Insurance System allows them to send their constituents to
hospitals which are primarily the responsibility of provincial/district/city
hospitals. The referral system has improved coordination in the delivery of health
services, especially between provinces, municipalities and cities.
4. Project Activities
a. Advocacy
The program conducts regular orientation visits to LGUs. For non-
participants to the Indigent Program, the orientation serves as a tool to entice them
to join the program. For existing program participants, the orientation serves as a
venue for updating new products and services of the Indigent Program. Updates
include new items in the list eligible for reimbursement or systems and procedures
governing the program. An orientation to new LGUs includes discussions on the
moral/ethical and legal responsibilities of local governments and its officials as
well as incentives for meritorious performance. Added to this are full explanations
on the workings and benefits that may be derived from the capitation scheme.
Samples of documents to be signed by the LGU officials are presented. Generally,
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the capitation scheme generates the most interest among LGUs. Prior to the
introduction of the Capitation Scheme, PhilHealth focused on the reimbursement
of hospital bills of policy holders, an arrangement which benefited principally the
provincial and city governments. There was no provision for covering outpatient
services which involved mainly the municipal RHUs as well as the CHCs.
Furthermore, at the time the Indigent Program was introduced, LGUs were faced
with financial problems spawned by inadequate funding to maintain and operate
local health facilities. It was no surprise then that LGUs, especially the
municipalities whose support the provincial leadership needed, were tepid to the
offers of partnership (via a Memorandum of Agreement or MOA modality) to
address the health problems of the poor.
b. Process of LGU Enlistment to the Indigent Program
The process of enlistment to the Indigent Program is as follows:
1. The local legislature passes a resolution adopting the program and
authorizing the LCE to enter into an agreement with PhilHealth;
2. The same body enacts an ordinance adopting the capitation fund on
indigent programs Out-Patient Benefit package;
c. Enrolment of Eligible Beneficiaries
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The following process summarizes the enrolment of eligible beneficiaries
to the Indigent Program:
1. The local social welfare officer, in cooperation with the barangay
(Village) chairperson, draws up list of enrollees, using PhilHealth guidelines for
proving indigence. At present, the guidelines are income-based, but this is being
phased out in favor of minimum basis needs (MBN) and community-based
monitoring information system (CBMIS);
2. The list is submitted to the Provincial Health Board for approval;
3. The approved list is then submitted to the PhilHealth Indigent Program,
which proceeds to enlist the LGUs enrollees into its master data base, computes
the requisite amounts of premiums that need to be paid, computes the capitation
fund due the LGU;
4. PhilHealth issues the enrollees service availment cards. The LGUs
share to the premium payments of indigents (amounting to P 1,188 or US$26.40
per family) depends on its classification: first to third class municipalities have to
shoulder bigger amounts per beneficiary than fourth to sixth class municipalities.
Specifically, first- to third-class cities and municipalities are given counterpart
funds equivalent to 50 percent of the total premium payments they have to make.
Fourth- to sixth class municipalities receive PhilHealth counterparts of up to 90
percent of the premium until such time that they can be upgraded to 3rd class.
d. Release of Capitation Fund
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The capitation fund, computed by multiplying the number of indigent
enrollees by the current fixed per capita amount of P300, is released in quarterly
tranches. This fund is used in the operation and upgrading of RHUs or CHCs or
for other health-care related uses. It has been used to purchase medicines (62
percent) and equipment/supplies (average of about 20 percent). The use of the
capitation fund for administrative expenses is limited to not more than 12 percent
of the capitation amount. Of the amount used for administrative expenses, half
must be paid to the RHU/CHC physician and the other half to be shared by the
centers staff members. This guideline has encouraged many health personnel to
stay on, a welcome respite from the current exodus of health personnel to Europe
and the Americas. LGUs have also used the capitation fund to purchase direly
needed equipment including ambulances, x-ray machines and laboratory
materials.
e. Availment of Health Services
The current indigent program features an outpatient benefit package that
covers: primary consultations with a physician, diagnostic and laboratory tests
and chest x-ray. This package is provided through RHUs and CHCs. These
facilities are paid a fixed fee of 300 per indigent household per year. As
administrators over these RHUs, local government units (LGUs) receive this
amount that is specifically designated to be used to complement health center
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funds, under well-defined guidelines for fund spending. Members are also entitled
to a basic inpatient package similar to the package offered for employed and
individually paying members. Members needing hospitalization can avail
themselves of the services of 1,512 PhilHealth accredited facilities, public and
private, found all over the country. Providers are reimbursed for services rendered
subject to maximum caps or ceilings for specific items (e.g. room and boards,
diagnostics, etc). Professional fees are paid subject to a relative unit value system
based on a classification for procedures made. Using the cards issued to them,
policy-holders go to RHUs and CHCs either for routine or symptoms-induced
check-ups. Depending on the results of these checkups, the RHU/CHC decides on
the kind of treatment: an outpatient treatment or hospitalization. For outpatient
treatments, the card entitles the policy holder to free services and medicines. If
hospitalization is needed, the RHU/CHC officer-in-charge writes a referral letter
which the indigent presents to the accredited hospital. The LGU handles all the
administrative requirements needed to reimburse services, facilities and supplies it
advanced to meet the needs of policy holders, including the collection of
capitation funds due the RHUs and CHCs. LGUs issue local guidelines to
translate Phil-Health policies and rules. These include guidelines for the use and
allocation of capitation funds as well as reimbursement of advances made by
LGU hospitals to policy holders.
f. Accreditation of Health Facilities
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The PhilHealth regularly inspects and accredits health care facilities
operated by both public and private health service providers who apply for
accreditation. The Department of Health and the Phil-Health are guided by rules
and regulations setting the standards for accreditation. Many LGUs have used
accumulated Capitation Funds to refurbish, re-equip or modernize their health
facilities to ensure that they obtain PhilHealth accreditation.
g. Training in Health Service Delivery
Technical inputs and training services for LGU health units are facilitated
by the regional offices of DOH. These services are provided on a case-to-case
basis mostly through customized courses. Support from external donors has
helped expand the capacity of the regional DOH offices to respond to the LGUs
training needs.
h. Implementing Agency
The National Health Insurance Act mandates the PhilHealth to implement
and manage the National Health Insurance Program, including its component
Indigent Program. More specifically, the PhilHealth Indigent Program is
implemented and managed by the PhilHealths Program Management Group for
Membership and Marketing. This group coordinates all partner organizations
especially the LGUs and the latters health care facilities. It also works closely
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with the relevant national government instrumentalities including the Congress
and the Senate. PhilHealth also is responsible for monitoring the program.
i. Program Cost
The programs cost item consists essentially of premiums paid for jointly
by the PhilHealth and the LGUs. Each enrolment incurs a cost of P1,188 (US$
26.40). As of April, 2007, the program has cost the government about P4.7 billion
a year (US$104 million). This cost is shared between the national governments
National Health Insurance Program and the LGUs. The LGUs share however
depends upon its classification, as discussed earlier. It must be noted however that
of the amount, P1.18 billion (US$26 million) or roughly 25 percent is plowed
back to LGUs in the form of capitation funds to help them improve their health
facilities and maintain appropriate stocks of medical supplies.
C. OUTCOMES
In addition to increased revenues to PhilHealth (growth rates as high as 166
percent in high enrolment sites), undoubtedly, the Indigent Program, particularly through
the Capitation Fund scheme, has led to the upgrading of the capability of many LGUs,
through improved facilities and management, to deliver high quality health-care services
to their constituents. A fine example would be the province of Bukidnon in Mindanao,
where the provincial government financed the establishment of well-manned and well-
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supplied health stations in all towns to augment the capabilities of the RHUs in providing
primary health care. With the flexibility offered by insurance financing, the Indigent
Program has inspired local officials to develop and employ creative solutions to their
health problems. In some places, local public health facilities are improved so much as to
pose serious competition to private health service providers. Whether this is good or bad
news remains to be seen. Whatever the case, some observers have noted that in some
places, the competition has resulted in lower hospital rates.
The Indigent Program has expanded the coverage of local health service delivery
to unprecedented levels. Previously, hospital services were provided directly by LGU
hospitals. Under this old mode a provision of P500,000 (US$ 9,000) for hospitalization
expenses could cover only 75 patients, based on an average value of P6,600 (US$128)
per claim. Under the insurance system, that same amount can cover 4,000 families, or up
to about 20,000 beneficiaries. The incentives provided by the Capitation Fund have
encouraged LGUs to enroll the poorer constituents, effectively increasing the poors
access to quality primary health services and facilities.
Participation in the program increased the use of primary health care facilities.
There is anecdotal evidence to support the observation that such an increase is
significantly attributable to renewed interest of women in pre- and post natal care and
even childbirth, these services being accessible to indigent policy holders. One indication
of success in this regard is the number of days of drug stock outs in RHUs and CHCs. In
high (PhilHealth) enrolment areas, the average was 35 days compared to 180 days in
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areas with low enrolment rates. Studies conducted by the Department of Health also
showed that local health facilities in high enrolment areas were well-stocked and well-
equipped compared to those in low enrolment sites. Likewise utilization rates, measured
in terms of per capita visit rates per year, of RHUs and CHCs were higher (equivalent to
4.9 per 100 person days of listed members) in high enrolment sites compared to those in
low enrolment sites (2.5 per 100person days of listed members).
Health insurance has changed the way local public health provision is financed
(albeit partially). One is through the capitation fund and another through direct
reimbursement of advanced services, supplies and facilities. This has created a strong
motivation for LGUs to provide services to the poor at levels unheard of even in the
recent past.
There is at least one anecdote indicating that the program has positively impacted
on local politics by reducing patronage. A Mayor explained that he expected to reduce
the number of people approaching him for assistance once the health insurance program
is implemented in his municipality. He has so far been unsatisfied with the result but is
hopeful that it will change for the better.
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CHAPTER III
CONCLUSION
The PhilHealths Indigent Program has been evaluation in terms of coverage, quality
benefit availment, sustainability, and in terms of poverty alleviation.
A. COVERAGE
PhilHealth is definitely ahead of its deadline when it comes to membership coverage.
Table 1 shows the segregation of members to PhilHealth in terms of sectors, which the
Sponsored/Indigent Program ranks second in term of membership.
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Mass enrolment has proven to be an effective strategy in meeting PhilHealths mandate
of achieving universal coverage on its fifteenth year. However, it must be ensured that all
enrolled indigent members are really indigents. Though PhilHealth has a well-defined criteria in
choosing qualified indigent enrollees, politics will always intervene. Indigents who are known as
supporters of the existing LCEs are favored to those who are non-supporters.
Figure 1 shows the number of families actively enrolled in the Sponsored Program from
2000 2009:
The criterion based on whether the program was effective was in comparison to
PhilHealth set goals. Since the program was able to register more than the target set, therefore
the program can be considered effective in terms of coverage.
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B. QUALITY BENEFIT AVAILMENT
In terms of quantity, PhilHealth certainly achieved its goals, the question now lies on the
availment of benefits, whether these number of new members were able to avail quality
healthcare, and on the side of the sponsors, if they were also benefited in return of their
investment.
Comparing the number of members enrolled as to the actual member or beneficiaries
availing the program, Table 2 describes the percentage of members availing PhilHealth benefits
in the past 12 months:
In 2005, Philhealth contributed 11.0 percent or PhP 19.2 billion to the countrys total
health expenditure which amounted to PhP 180.8 billion. The burden of financing health
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care was still heaviest on individual families with 48.4 percent or PhP 87.5 coming
from households outofpocket spending. The NG contributed 16 percent or PhP 26.0 billion
while local governments gave 13 percent or PhP 24.7 billion. One of the targets
of the National Objectives for Health is to have 15 percent of financed by PhilHealth by 2010.
In terms of the amount of paid claims, figures show that PhilHealth was able to meet its
targets and have continuously paid more filed claims since it has been created. This can be
bserved in the figure below:
But first hand testimonies have spoken that not all can testify quality benefit availment.
For one, the tedious process of filing for a benefit claim. Healthcare providers lack the
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uniformity of their requirements and processes in filing for a claim. Members who are supposed
to be indigents are thus burdened of the expenses just to be able to retrieve all the documentary
requirements. This happens when the healthcare provider requires attachments that are yet to be
retrieved in PhilHealths service offices which often located far from the hospital where most
indigent members are admitted. More often than not, cardholders choose to knock on the
doorsteps of their Mayors than consume themselves processing their filing of claims. This is not
an uncommon situation especially when most of the indigent members are not well informed of
the nature of PhilHealths programs and process flow in benefit availment.
On the side of the sponsors, their benefit from the program lies at the release of the
PhilHealth Capitation Fund (PCF), which is released as a trust fund to finance for medical
supplies and improvements on medical facilities on sponsoring LGUs or Provinces. This
mechanism has also proven to be an attractive package that enticed almost all municipalities and
provinces nationwide to enter into a memorandum of agreement in implementing the Indigent
Program.
But there are requirements needed in order to receive the PCF, namely, implementation
of the Indigent Program, timely payment of the premium, and a PhilHealth accredited healthcare
provider (this may refer to a rural health unit or a hospital). Thus the LGU is again required to
invest in improving their respective RHUs in order to meet the accreditation standards set by
PhilHealth. But this did not hinder enrolment even in 4th-6th class LGUs since they often get the
lions share of the benefits. They are able to provide health insurance to their indigent
population, they get to improve their local health facilities, they pay the lesser counterpart of the
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premium (sharing it with the national government in incrementing levels based on the year of
implementation of the program), plus they usually receive a much higher amount of PCF than the
actual premium that they have paid.
C. SUSTAINABILITY
How long can PhilHealth sustain this Program? Moneywise, PhilHealth is releasing too
much of its money in implementing the Indigent Program. But fifteen years after its initial
implementation, PhilHealth claims to be in a financially stable state. With its current assets
reaching up to P91 billion as of July 31, 2009, President Rey B. Aquino firmly asserts that
PhilHealth is on solid ground and counting. In fact, earnings from investments have allowed
PhilHealth to expand the numbers of its beneficiaries and increase hospitalization by 35% as of
April 2009.
D. POVERTY ALLEVIATION
Created in the context of the worsening poverty, the Indigent Program initially was
tasked to extend health insurance to the needy. Since poverty is caused by a multitude of
elements, it is but improper to treat health insurance as the only solution. Although provision of
health insurance can somehow alleviate poverty in terms of availment of health services, the
program can be considered effective in such area.
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E. SLOGAN
Created to improve the Medicare system, PhilHealth extended health insurance coverage
to the unserved sectors, more importantly the poorest in the society. The PhilHealth Indigent
Program is also known as Medicare Para Sa Masa, was aimed at ensuring that all sectors in the
society benefits from the National Health Insurance. It is a practice of social equity wherein
healthcare is made available to every Filipino citizen.
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CHAPTER IV
RECOMMENDATION
Initially, LGUs did not respond positively to invitations to participate in the program for
a number of reasons: (a) the initial design benefited principally provinces and cities which were
responsible for the operation of hospitals; (b) the program was viewed as a cost center
requiring the usual counterpart funds; and (c) there was general discontent among the LGUs over
the inadequacy of funding for health operations vis--vis the magnitude of the responsibility. The
introduction of the capitation funding scheme and the cost sharing scheme between national and
local governments to cover premium payments changed the minds of LGU officials. Further,
many officials also saw participation as a concrete way of gaining electoral advantage.
A second major challenge was the selection of enrollees. Political patronage figured
prominently in the selection of enrollees. This had to be overcome by ensuring that official
guidelines were followed. In some instances, non-government groups were asked to assist in the
selection. This challenge continues to be an on-going concern and only the vigilance and
dedication of the concerned local officers, specifically the social worker and the village leaders,
PhilHealth officials and civil society groups, can minimize the influence of political patronage in
the selection process.
A third challenge is changing the way local officials view the capitation fund. PhilHealth
officials are leery of the view that the capitation fund is a return on investment. This was and
still is being overcome by painstaking education work among LGUs to make them realize that
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the fund is provided as a means to improve health service delivery and reduce health service
delivery cost.
Information on the entitlements that come with being insured has been confusing and in
certain cases, conflicting. This includes poor information on the obligations of the insured
particularly on the matter of what is and is not covered by the insurance. Often this has led to
confusion over what the insured needs to pay for. This has inconvenienced both the indigents as
well as both the local private and public service providers. Information dissemination on such
entitlements was and continues to be inadequate. The PhilHealth, together with the DOH and the
LGUs has agreed to address this information need. Inequality of coverage among regions is
conspicuous. The programs management believes however that LGUs now lagging behind the
others in terms of enrollment would be catching up as soon as they realize the advantages of
increasing their indigent enrollees.
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REFERENCES
Publications
PhilHealth at a Glance, November 2009, Senate Economic Planning Office
Priming the Health Insurance Programme for the Indigents, 2002, Philippine Health Insurance
Corporation
Republic Act No. 7875, National Health Insurance Act of 1995 Instituting a National Health
Insurance Program and Establishing the Philippine Health Insurance Corporation
The Revised Implementing Rules and Regulations of the National Health Insurance Act of 1995,
First Edition, July 2000
1996 2002 PHIC Annual Report
Best Practices in Health Financing, Department of Health
Online References
Philippine Health Insurance Corporation Website, Accessed at ,
Accessed on January 04, 2010
U.S. Library of Congress Website, Accessed at ,
Accessed on January 13, 2010
Health Care in the Philippines, Accessed at ExpatForum Website at
,
Accessed on January 15, 2010
World Health Organization Website, Accessed at ,
Accessed on January 15, 2010