MANILA, Philippines — Public health reform advocates and budget watchdogs are calling on lawmakers to investigate the Philippine government’s move to divert billions of pesos in excess funds from state-run insurance firm PhilHealth to finance “unprogrammed appropriations” this year.
The controversy centers around a recent Department of Finance (DOF) circular that directs PhilHealth to remit to the national treasury its unused government subsidy amounting to 89.9 billion Philippine pesos ($1.6 billion).
Prominent figures like Dr. Tony Leachon, a former special adviser to the Department of Health, have expressed concern that this could be a new way for the government to misappropriate funds, similar to the controversial Maharlika Wealth Fund which tapped state pension funds for its startup capital.
Critics argue this action violates the country’s Universal Health Care Act of 2019, which stipulates that any excess PhilHealth reserves must be used to increase benefits or decrease member contributions, not be diverted to the general budget.
“Excess funds should not be directed to unprogrammed appropriations within the national budget when PhilHealth has been ineffective at carrying out its mandate of ensuring affordable, acceptable, available and accessible health-care services for all citizens of the Philippines,” Leachon said.
The DOF has justified the move by arguing that the national government is better positioned to utilize the unused PhilHealth subsidies for programs that directly benefit the Filipino people. However, former Finance Undersecretary Cielo Magno and Filomeno Sta. Ana III of the think tank Action for Economic Reforms warn this could be a new way to misappropriate funds.
As of May, PhilHealth has already transferred 20 billion pesos ($360 million) of the 89.9 billion pesos in unused funds back to the national government, a move approved by its board of directors chaired by Health Secretary Teodoro Herbosa.
With concerns over potential misuse of public funds and violations of health care legislation, advocates are urging lawmakers to thoroughly investigate this controversial government directive.
