Finance Secretary Ralph G. Recto has assured the public that the reallocation of the Philippine Health Insurance Corporation’s (PhilHealth) idle funds to support government priority projects will not negatively impact the benefits received by its members.
Recto emphasized that the move is designed to be in line with the principle of “do no harm” and will not affect the daily operations or the planned expansion of PhilHealth’s benefit packages for this year.
“The Department of Finance’s [DOF] move is consistent with the medical principle of ‘do no harm’. I reiterate that PhilHealth’s daily operations will remain unaffected, and no member contributions will be touched,” Recto said.
He further clarified that, “Not a single centavo will be deducted from the benefits that members are entitled to. In fact, according to the President, member benefits will even increase this year.”
Recto disclosed that even after transferring PHP 89.9 billion in unused government subsidies to the National Treasury, PhilHealth still retains approximately PHP 550 billion in its reserves, which is sufficient to cover its expenses for two to three years.
This substantial reserve will enable PhilHealth to enhance its benefits by more than 30% in 2024.
As an example, Recto mentioned that coverage for severe illnesses like breast cancer, currently set at PHP 100,000, will be increased to PHP 1.4 million.
By the end of 2024, Recto projects that PhilHealth will have a net income of PHP 61.18 billion, with the agency’s income having steadily risen from PHP 4.66 billion in 2019 to PHP 173.46 billion in 2023.
Moreover, PhilHealth is expected to receive an additional PHP 70 billion in government subsidies next year.
The decision to reallocate these funds is part of a broader strategy by the DOF to finance the government’s daily expenses, which amount to PHP 15.8 billion, without imposing additional taxes or borrowing.
Recto highlighted the importance of utilizing idle funds that are otherwise incurring interest.
“There is money sitting idle, and we are even paying interest on it. It’s better to use these funds rather than let them sit unused.”
The initial transfer of PHP 20 billion from PhilHealth to the National Treasury has already been utilized to pay health emergency allowances for frontliners, totaling PHP 27.5 billion and covering 5.04 million claims.
The remaining funds will support various projects in nutrition, education, agriculture, social development, and infrastructure, which are expected to have significant positive impacts on the public.
According to the DOF’s cost-benefit analysis, the projects funded under the Unprogrammed Appropriations are anticipated to boost the country’s GDP growth by 0.7%, generate additional revenue of PHP 23 billion to PHP 24.4 billion, and create hundreds of thousands of jobs.
“Our economy will grow, the government will earn revenue, we can reduce our debt, and poverty in our country will decrease,” Recto concluded.
He also reiterated the DOF’s commitment to prioritizing health spending and expressed openness to engage with the public on concerns related to the reallocation of funds.
