Civil society groups demand return of PhilHealth funds

By Francis Allan L. Angelo

A coalition of civil society groups, including representatives from urban poor communities, women’s organizations, senior citizen associations, disability advocates, labor groups, and financial experts, demanded that the Department of Finance (DOF) return the P89.9 billion in diverted PhilHealth funds to the Philippine Health Insurance Corporation (PHIC).

The funds, initially allocated for healthcare, were redirected to the National Treasury, sparking significant backlash.

During a press conference last week, former Finance Undersecretary and University of the Philippines School of Economics Associate Professor Dr. Cielo Magno challenged the DOF’s argument that the transferred funds were unused government subsidies.

“These funds are not mere government subsidies but essential contributions intended for the healthcare needs of PhilHealth members, including vulnerable groups like persons with disabilities, senior citizens, and beneficiaries of the Pantawid Pamilyang Pilipino Program (4Ps),” Magno emphasized.

Supporting this stance, Dr. Marivic Raquiza, Associate Professor at UP and representative of Social Watch Philippines said it is impossible for PhilHealth to have unsued funds.

“There is no such thing as ‘excess funds’ in PhilHealth because there is no scarcity of Filipinos with illnesses which PhilHealth can and should cover. On the contrary, there are so many ailing Filipinos who are either not yet covered or need additional financial support from PhilHealth,” Raquiza said.

The civil society groups highlighted a lack of transparency in the budget process, particularly concerning the Special Provision that allowed the transfer of GOCC reserve funds, which served as the legal foundation for DOF’s Circular 2024-003.

Dr. Raquiza criticized the opaque insertion of this provision during the bicameral conference committee discussions for the 2024 budget.

Responding to the Department of Health (DOH) and Department of Budget and Management (DBM)’s declaration that P27 billion of the diverted funds would be used for the Health Emergency Allowance (HEA) of frontline health workers, Jillian Roque of the Public Services Labor Independent Confederation (PSLINK) argued that the HEA should have been prioritized within the DOH budget itself, not at the expense of PhilHealth resources.

Roque suggested providing premium relief for workers if PhilHealth cannot expand benefits promptly.

Concerns from Vulnerable Sectors

Senior citizen groups, represented by Paz Basconcillo of the Coalition of Older Persons Association of the Philippines and Salve Basiano of the National Anti-Poverty Commission Basic Sector – Senior Citizens, expressed concerns that diverting premiums exposes older persons to catastrophic health expenses.

Similarly, Dr. Jun Bernandino, President of LifeHaven Center for Independent Living, noted that only a small percentage of persons with disabilities are covered by PhilHealth, questioning the logic behind reallocating these crucial funds.

“Bakit kukunin ang pera kung hindi pa nga sapat ang benepisyo para sa amin?” Bernandino asked.

The coalition urged the government to return the P20 billion already remitted to the Treasury and halt the transfer of the remaining P70 billion to safeguard PhilHealth members, particularly the poor and vulnerable.

They are circulating a citizens’ unity statement titled “Pondo ng PhilHealth gamitin nang tapat. Hindi dapat ilipat. Kaming taumbayan ang inyong katapat!” demanding accountability and the rightful use of PhilHealth funds for their intended purpose.

‘IDLE FUNDS’

Finance Secretary Ralph G. Recto defended the diversion, citing compliance with Congress’s directive to use idle GOCC funds for unprogrammed appropriations under the 2024 General Appropriations Act.

In a statement, Finance Secretary Ralph G. Recto clarified that the Department of Finance (DOF) is following Congress’ directive to utilize idle funds from government-owned and controlled corporations (GOCCs) for unprogrammed appropriations under the General Appropriations Act (GAA) of 2024.

Recto assured that PhilHealth members’ contributions remain untouched and that the reallocated funds will stimulate economic growth and job creation.

Addressing the Senate Committee on Health and Demography, Recto highlighted the legal basis for using unutilized funds from PhilHealth, emphasizing compliance with Republic Act No. 11975.

Recto explained that the DOF, after consulting the Governance Commission for GOCCs, the Government Corporate Counsel, and the Commission on Audit, received favorable opinions confirming that PhilHealth’s PHP 89.9 billion unutilized subsidies are not part of its reserve funds restricted by the Universal Health Care Act.

The reassigned funds will finance significant infrastructure projects, including the Davao City By-Pass Construction Project, the Panay-Guimaras-Negros Island Bridges, and the Metro Manila Subway Project.

These projects are projected to boost GDP growth by 0.7%, generate PHP 23-24.4 billion in revenues, and create hundreds of thousands of jobs.

“Our cost-benefit analysis shows that the projects to be funded by the Unprogrammed Appropriations–na utos ng Kongreso–will hike real GDP growth by 0.7%, increase an additional P23-24.4 billion in revenues, and create hundreds of thousands of jobs,” Recto said.

Recto also warned against the risks of funding these projects through additional borrowings, which would raise the deficit-to-GDP and debt-to-GDP ratios, leading to higher interest payments and potential credit rating downgrades.

He debunked rumors that the funds would be diverted to the Maharlika Investment Fund and confirmed that only PHP 20 billion has been remitted to the Bureau of the Treasury, with PhilHealth maintaining a robust PHP 500 billion benefit chest fund.

“PhilHealth na mismo ang nagsabi na ni isang kusing, walang kaltas sa mga benepisyong matatanggap, batay sa kasalukuyang patakaran. Bagkus, nabanggit pa nga ng Pangulo sa kanyang SONA na tataasan ang mga benepisyo ng PhilHealth,” Recto reiterated.

As discussions for the 2025 National Expenditure Program begin, Recto urged Congress to prioritize projects that maximize economic growth and job creation, while adhering to the Medium Term Fiscal Program aimed at reducing the country’s deficit and debt.

“At the end of the day, my dear honorable members of the Senate, dahil kayo ang may akda ng GAA na pinapatupad namin — magsabi lang po kayo ng inyong mga panukala kung paano popondohan ang mga proyektong nasa pambansang badyet, at handa kaming makinig at sumunod sa inyong utos,” Recto said.