PhilHealth should not rely on premium contributions

PhilHealth’s role as a strategic purchaser of health care services/goods is the fulcrum that balances the health and economic effects of the pandemic. Our social health insurance (SHI) protects Filipinos against financial hardship in almost the same way it protects hospitals from bankruptcy.

Studies in the past suggest that in times of economic crisis, three things are likely to occur: 1) Massive unemployment leads to a decrease in premium contributions; this, in turn, leads to decreased funds for the SHI. 2) Because of decreased household income, there is a tendency for families/patients to either a) reduce expenditure by reducing health care utilization (we do not want this during a pandemic) or b) choose cheaper providers (such as government-run institutions). 3) Private institutions do not have the incentive to increase hospital charges because this may lead to a further decrease in health care demand. They turn to SHI for revenue, which may eventually explain why there will be an abrupt increase in benefit claims in PhilHealth.

In the past, the central governments of other countries have provided financial support to their struggling SHIs. PhilHealth should NOT rely on premium contributions to finance health care, especially during an economic crisis. Relying on premiums alone is detrimental to the survival of the SHI because, as I said earlier, there is a decrease in premium contributions given the economic crisis.

Our government should provide the necessary financial support to PhilHealth in order for it to survive post-pandemic. After all, the government has borrowed billions from external funders which should be primarily used to fund the pandemic response. Taxes and other sources of revenue may also be repurposed or realigned to achieve this goal.

Reiner Lorenzo J. Tamayo, RN, [email protected]