The National Health Insurance Program in The Philippines: Critical Challenges and Future Directions

The National Health Insurance
Program in the Philippines:

Critical Challenges and Future
Directions
Maricel T. Fernandez
Alex B. Brillantes Jr
Abigail Modino
PIDS HSRM Knowledge-Sharing Seminar
01 July 2014, PIDS, Makati City
Main Messages of the Paper
Access to health care not only promotes good health and longevity, but
as an investment in human capital, also contributes to labor force
productivity, employment and, eventually, economic growth in the long
run (PDP, 2011)
Universal health care has been a value articulated by recent

administrations and been given priority by the Aquino Administration
Earlier on, there were attempt to pass UHC policies beginning with
Medicare and the Primary Health Care Act in 1979.
Since then, a number of laws have been passed the landmark legislation
of which was the National Health Insurance Act of 1995 (Republic Act
7875). The latest law was the National Health Insurance Act of
2013 (Republic Act10606) passed in July 2013.
Before the passage of RA 10606, the study team was

commissioned (May 2013 to May 2014) to identify areas
of potential improvement for RA 7875 and RA 9241. The
study team discovered that a number of proposed bills
pending in Congress were actually addressing areas of
reform and improvement specifically in the following
areas: administrative, operational and financing
As the study was being conducted, RA 10606 was passed.
It was within this context that the study examined the
new law and whether it actually addressed the areas of
improvement included in the proposed bills
The new law (RA 10606) is an improvement of the

former laws (RA 7875 and 9241). More specifically, the
new law provides improvements and reforms in the
following areas:
Membership classification (Membership classification has been

changed to capture those previously unenrolled)
Source of premium: (the contributions of those identified by
the NHTS are covered by the national government. The LGUs
cover those still in the poor segment but not covered by
NHTS)
Role of LGU: SPHEAR (Sponsor, Payer, Health Care Provider,
Employer, Advocate, Regulator) VP Greg Rulloda of Philhealth
The enabling framework for improvement and reform of

the NHIP has been set. The challenge in meaningful
implementation
Paper Outline
Rationale and Background
The National Health Insurance Program and Related

Laws and Policies on Health
Objectives
Methodology and Initial Review of Previous Studies
Overview of the Health Sector in the Philippines
The National Health Insurance Act of 1995 (Republic Act

7875)
The National Health Insurance Act of 2013 (Republic Act
10606)
The NHIP Experience (best practices in Luzon,

Visayas & Mindanao)
Emerging Issues and Next Steps
Objectives of the study

This study seeks to:
Analyse the status of the implementation of the NHIA
of 1995 and other social health insurance
policies/programs in the Philippines;
Identify some best practices on SHI in the region;
Identify emerging contemporary issues and concerns in
the social health insurance; and
Recommend appropriate policies that may be adopted
to improve health insurance in the Philippines.
Objectives of the study

Further objective
Study the new provisions of the recently enacted
Republic Act 10606 or the National Health Insurance
Act of 2013
Methodology
Extensive review of documents and bills pending in both

houses of congresses that aim to reform and improve the
public health insurance system in the Philippines;
Extensive review of the National Health Insurance Act
(NHIA) of 1995 and the National Health Insurance Act
(NHIA) of 2013 and their corresponding IRRs; and
Focused group discussions and key informants interviews
with stakeholders at the national and local levels.
Rationale and Background of the Study
Health insurance in the Philippines is relatively new.

The long term effects of comprehensive health insurance
are still to be measured and felt.
Philippine experience in social health insurance has not
fared well comparing to our neighbors in Asia
The challenge to fulfill the universal health care
(Kalusugang Pangkalahatan).
Overview of the Health Sector in the

Philippines
unequal access to
health services and the
large share of
household out of
pocket spending in
total health
expenditures.
(Manasan, 2011).
Overview of the Health Sector in the

Philippines
On meeting the MDGs
Reduce by two-thirds between the under-five

mortality rate
Improve maternal health
Combat HIV/AIDS, malaria and other diseases.
It is unlikely that the Philippines will be able to meet

some of its target by 2015 (NSCB)
A Background of the Philippine Health

Sector
The KASAPI (Kalusugang Sigurado at Abot Kaya sa

PhilHealth Insurance)- program of Philhealth as a strategy
to make healthcare more accessible to the poor (Llanto,
2007)
The role of subnational institutions (local governments) in
providing services to the poor within a decentralized
framework (Capuno, 2006)
The
National Health Insurance

Act and Related Policies
A look at the health policies
Section 15, Art. 2 of the 1987 Constitution provides that the

state shall protect and promote the right to health of the
people.
The Primary Health Care (PHC, 1979) was created to provide
basic health care services.
Executive Order No. 851 to integrate preventive, curative and
rehabilitative components of health care delivery in the
country (1982)
Executive Order 119 (1987) reorganization of the Ministry of
Health and attached agencies
Republic Act 6675 or the Generics Act of 1988.
Republic Act 7160 or the Local Government Code of 1991
(LGC).
National Health Insurance Act of 1995
A look at the health policies
1999 Health Sector Reform Agenda

1999 Executive Order 102 instituted changes and
operations of the DOH
RA 9271 The Quarantine Act of 2004
FOURmula One (F1) for Health (2005)
RA 9502 Universally Accessible Cheaper and Quality
Medicines Act (2008)
RA 9711 Food and Drug Administration Act (2009)
The Aquino Health Agenda (AHA) (2010)
RA 1035 Sin Tax Law (2012)
RA 10606 NHIA of 2013
The NHIP
Republic Act of 7875 or otherwise known as National

Health Insurance Act of 1995
Provides for the creation of the Philippine Health
Insurance Corporation
The program aims to cover all Filipino citizens but not
compulsory
Legislative History of NHIP

Universal
Health Care
Republic Act 10606
June 19, 2013
Republic Act 9241

February 10, 2004
Republic Act 7875

February 14, 1995
18
Philhealth membership by program

100%
90%
80%
70%
60%
OFW
50%
Lifetime Program
40%
Individually Paying
Sponsored Program
Employed
30%
20%
10%
0%
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Source: PhilHealth Corplan
In other words . . .
Employed members are highest due to automatic employment

by the employers. By 2011, almost 40% of the total number of
members came from the employed program
Individually paying program (IPP) members are mostly self
employed and enrolment is voluntary thus there are challenges
in sustaining their membership
Sponsored members are those identified by the local
governments hence compared to IPP, there is a mechanism to
ensure enrolment. They have been pre-identified by the LGUs.
LGUS have measures to identify indigents and hence enrol
them in the program. there had been increase in the
enrolment of the indigents under the Sponsored Program.
Lifetime members include retirees and pensioners of the

GSIS including uniformed and non-uniformed personnel
of the AFP.
OFWs are the latest addition to the Program. It has been
observed that it is easier for employers of sea-based
OFWs to provide counterparts since sea-based OFWs
are considered locally based. Non-sea based OFWs have
to shoulder the entire contribution. (It is important to
further disaggregate the OFW category since sea-based
OFWs are also considered locally employed.)
RA 10606 and IRR

Republic Act 10606:
Mandatory health care for Filipinos
Ensures coverage of the marginalized by prioritizing health care needs of the
underprivileged, sick, elderly, persons with disabilities (PWDs), women and
children and provide free health care services to indigents.
Strengthens program implementation
The IRR:
Streamlines the PhilHealth membership experience
Establishes simpler procedures in accrediting health care providers to promote
greater access to health services across the country without sacrificing the quality of
care.
Highlights the new role of the Local Government Units in implementing the National
Health Insurance Program as well as the enhanced powers of PhilHealth in
implementing the Program.
22
Membership Categories
RA 9241
23
Employed
Sponsored,
Individually Paying
Overseas Filipinos
Lifetime
RA 10606
Formal Sector
Indigents
Sponsored
Informal Sector
Lifetime
Categories
Qualified Members
Formal Sector
Government and Private employees

All other workers rendering services, whether in government or
private offices such as job order contractors, project-based
contractors, and the like
Owners of micro enterprises; Owners of small, medium and large
enterprises
Household helpers
Family Drivers
Informal Sector
Migrant workers (documented and undocumented)

Informal Sector
Self-Earning Individuals
Filipinos with dual citizenship
Naturalized Filipino citizens
Citizens of other countries and / or residing in the Philippines
Lifetime
Member who has reached the age of retirement under the law and has
paid at least one hundred twenty (120) monthly premium contributions
Retirees/ Pensioners from the Government Sector
Retirees/ Pensioners from the Private Sector
Uniformed Members of the AFP, PNP, BJMP and BFP
24
Categories
Qualified Members
Sponsored
A member whose contribution is being paid by another individual, government

agency, or private entity according to the rules as may be prescribed by the
Corporation.
Indigents
25
Members of the informal economy from the lower income segment who do
not qualify for full subsidy under the means test rule of the DSWD
(Premium Source: NG and / or LGUs and / or Legislative Sponsor)
Orphans, abandoned minors, out-of-school youths, street children, PWDs,
senior citizens, battered women under DSWD custody or any of its
accredited
(Premium Source: DSWD)
Women about to give birth (and as determined by means test recognized
by DSWD)
(Premium Source: NG and / or LGUs and / or Legislative Sponsor)
Barangay health workers, nutrition scholars, volunteers, etc.
(Premium Source: LGU)
A person who has no visible means of income, or whose income is insufficient

for the subsistence of his family, as identified by the Department of Social
Welfare and Development through the NHTS
(Premium Source: National Government)
Key provisions on the membership categories

Categories
Changes
Formal
Monthly contributions to be shared equally by the employer and employee

at a prescribed rate set by the Corporation not exceeding (5%) of their
respective basic monthly salaries;
Inclusion of Kasambahay (as defined by Kasambahay Law); job order
contractors, project-based contractors, and the like
Informal
Inclusion of Migrant Workers (sea-based and land-based)
Lifetime
Any person who has reached the age of retirement and has paid at least
120 monthly contributions shall be qualified as a Lifetime Member. The
number of monthly contributions required as a Lifetime Member may be
increased in accordance with an actuarial study to sustain the financial
viability of the Program.
The law mandates the Corporation to set up funds at the appropriate time:
(a) to secure benefit payouts to lifetime members and (b) fund to secure
payouts to lifetime members.
Sponsored
Previously identified by the LGUs

Premium contributions for all identified should co-sponored with the NG
based on LGU classification
Indigents
Full subsidy of the National Government

Identified by DSWD using the NHTS
26
Role of Local Governments (SPHEAR)

according to VP Rulloda of PhilHealth
Other changes
Dependents
Parents who are 60 years old or above, whose income is below an
amount determined by the Corporation are qualified dependents.
In addition: Parents with permanent disability that render them totally
dependent on the member for subsistence are also considered qualified
dependents
Emancipated Individual / Single Parent
Any person below 21, married or unmarried, but with a child, should be
enrolled as a separate member
30
The NHIP Experiences:

Perspectives from the Field
The NHIP experience in Region 10
Good practices in Bukidnon (locally-initiated social health

insurance)
Local health stations and RHUs
Implementation of the Bukidnon hospital system
Members- 158,549 (as of 2013) (highest in the country)
Payment is 50-50
Leadership is key.
The NHIP Experience in Region 2 (Northern Luzon)
Implementation of the Business One-Stop Shop (BOSS) in

several municipalities in the region.
30 BOSS centers
For membership application, remittance reports, premium
payments, and issuance of necessary forms and PhilHealth
clearance.
The NHIP Experience in Region 2 (Northern Luzon)
Agarang Aksyon Gamit ang Alternatibong Dokumento

(AGAD) project.
An innovation that showcases flexibility on benefit
availment policy
The use of alternative documents such as declaration
form, PhilHealth Cares Form 1 (PCF-1) and verification
forms, depending on the concern of the member.
The NHIP Experience in Region 8 (Eastern Samar)Visayas
Philhealth Link- A working CALL-CENTER
Receive inquiries and requests for verification from

PhilHealth coordinators based in hospitals.
PhilHealth link can filter the information to check the

exact status of membership of patients.
Emerging Issues and Challenges
Administrative issues
The increasing role of the National Government Agencies

and the decreasing role of the local governments
The need for financial health
The ultimate aim of the new law is to provide universal access

to health in response to the MDGs, however, financial issues
have to be addressed and who takes care of the finances
In terms of premium sharing, members in the informal sector
from the lower income segments who do not qualify for full
subsidy under the means test rule of the DSWD shall be
entirely subsidized by the LGUs or through cost sharing
mechanisms between / among LGUs and / or legislative
sponsored and / or the member, including the National
Government.

Who handles what?
Questions are raised on the decreasing role of LGUs in handling
the administrative and financial aspects of health insurance;
however, in the new law, LGUs are given the opportunity to
improve their health facilities to be provided by the national
government.
Bawat Pilipino, Miyembro

Bawat Miyembro,
Protektado
Kalusugan Natin,
Segurado
39

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The National Health Insurance

Program in the Philippines:

Main Messages of the Paper

Universal health care has been a value articulated by recent

Before the passage of RA 10606, the study team was

The new law (RA 10606) is an improvement of the

Membership classification (Membership classification has been

The enabling framework for improvement and reform of

Rationale and Background

The National Health Insurance Program and Related

The National Health Insurance Act of 1995 (Republic Act

The NHIP Experience (best practices in Luzon,

Objectives of the study

Objectives of the study

Extensive review of documents and bills pending in both

Rationale and Background of the Study

Health insurance in the Philippines is relatively new.

Overview of the Health Sector in the

Overview of the Health Sector in the

On meeting the MDGs

Reduce by two-thirds between the under-five

It is unlikely that the Philippines will be able to meet

A Background of the Philippine Health

The KASAPI (Kalusugang Sigurado at Abot Kaya sa

National Health Insurance

A look at the health policies

Section 15, Art. 2 of the 1987 Constitution provides that the

A look at the health policies

1999 Health Sector Reform Agenda

Republic Act of 7875 or otherwise known as National

Legislative History of NHIP

Republic Act 9241

Republic Act 7875

Philhealth membership by program

Employed members are highest due to automatic employment

Lifetime members include retirees and pensioners of the

RA 10606 and IRR

Government and Private employees

Migrant workers (documented and undocumented)

A member whose contribution is being paid by another individual, government

A person who has no visible means of income, or whose income is insufficient

Key provisions on the membership categories

Monthly contributions to be shared equally by the employer and employee

Inclusion of Migrant Workers (sea-based and land-based)

Previously identified by the LGUs

Full subsidy of the National Government

Role of Local Governments (SPHEAR)

The NHIP Experiences:

The NHIP experience in Region 10

Good practices in Bukidnon (locally-initiated social health

The NHIP Experience in Region 2 (Northern Luzon)

Implementation of the Business One-Stop Shop (BOSS) in

The NHIP Experience in Region 2 (Northern Luzon)

Agarang Aksyon Gamit ang Alternatibong Dokumento

The NHIP Experience in Region 8 (Eastern Samar)Visayas

Philhealth Link- A working CALL-CENTER

Receive inquiries and requests for verification from

PhilHealth link can filter the information to check the