By Joseph Bernard A. Marzan
The Philippine Health Insurance Corporation (PhilHealth) board approved its PHP 284-billion operating budget for 2025 on Monday, December 16, despite the absence of government subsidies.
In a press release on Tuesday, December 17, the Department of Health (DOH) stated that PhilHealth’s Corporate Operating Budget (COB) for 2025 is 10% higher than this year’s PHP 259 billion.
The budget allocates PHP 271 billion for benefit expenses, PHP 12.5 billion for administrative costs, and PHP 259 million for capital expenditures.
The allocation for benefit expenses includes increases in case rates, Z Benefits, and capitation rates under PhilHealth Konsultasyong Sulit at Tama (KonSulTa), which will be raised to PHP 1,700 and PHP 2,100 per person.
It also covers 156 hemodialysis sessions at PHP 6,350 per session, alongside funding for emergency care, outpatient mental health services, severe acute malnutrition treatment, and standalone outpatient packages.
Z Benefits are financial risk protection packages for illnesses deemed medically and economically catastrophic.
The KonSulTa program, part of the Universal Health Care Act (Republic Act No. 11223), provides comprehensive outpatient care for PhilHealth members.
The capital expenditures allocation was reduced after the low utilization of the 2024 COB, where only 8% of the PHP 2.9 billion set for information and communications technology (ICT) and other projects was spent.
To ensure continued digitization, the board extended the validity of PHP 989 million allocated for ICT projects under the 2024 budget.
The DOH explained that PhilHealth’s COB functions as its version of the General Appropriations Act, funded internally through member premium contributions rather than government appropriations.
PhilHealth’s budget was drawn from its accumulated revenues of PHP 431 billion, minus the Reserve Fund ceiling of PHP 281 billion.
The DOH also factored in the absence of a PHP 150-billion government subsidy, based on PhilHealth’s projections as of October 31.
“PhilHealth has a lot of money, well over the reserve fund ceiling allowed by law. This surplus is a result of underspending for benefits through the years, which is why Filipino families pay high out of pocket,” said DOH Secretary Teodoro Herbosa.
“The Board approved higher benefits and a budget for 2025 that recognizes the need for PhilHealth to spend more so that families will spend less,” he added.
The DOH originally proposed PHP 74 billion to subsidize indirect contributors to the state-run health insurance provider.
However, Congress’ Bicameral Conference Committee ultimately cut the funding in the final budget.
Senator Grace Poe, chairperson of the Senate Committee on Finance, explained that the lack of subsidies would push PhilHealth to utilize its reserve funds first.
