DESPITE admitting that the Philippine Health Insurance Corp. (PhilHealth) is “struggling” with its systems to pay its current debts, Finance Secretary Carlos G. Dominguez III said the state health insurer still has a “very viable” cash flow.
Dominguez told finance reporters that PhilHealth has a reserve fund of P164.1 billion as of June this year. Citing tentative figures, the finance chief said PhilHealth’s deficit as of June this year also stood at P25.5 billion, which is covered by P44.6 billion in subsidies given by the national government for the first half of the year.
“Well, PhilHealth has about a P160 billion in reserve funds. That’s my recollection and of course they are, at the moment, struggling with their own systems to pay off their current debts. So PhilHealth is amply covered by the subsidy provided by the national government,” said Dominguez, who is an ex-officio member of PhilHealth’s Board of Directors.
While the finance chief expressed confidence that the state health insurer “will not disappear” and can sustain massive spending for “several years,” he said there might be some changes in terms of its coverage.
“PhilHealth is still very viable on the cash flow basis but again let us point out that PhilHealth has in fact incurred a drop in contributions because of the problems with the Covid and there’s also experienced increase in expenditures, but so far I believe they can handle the situation,” he added.
The Insurance Commission (IC) has also come out with a preliminary report following its actuarial study on PhilHealth, according to Dominguez.
Dominguez stopped short of revealing the findings of the IC on PhilHealth, but he said it’s like most institutions wherein “some things are good and some things are bad.”
“They are in discussions again with PhilHealth board and PhilHealth management on their findings. This is the first time ever that IC has examined government institutions,” he said.
“I leave that to IC to release when they are ready to release their findings, and of course we will not publish it until all the board members of PhilHealth are also aware of those findings,” he added.
IC’s Funa: Review planned
FOR their part, Insurance Commissioner Dennis B. Funa told the BusinessMirror that their actuarial division told him that they are still planning to do a comprehensive actual review but they are still hiring an actuarial consultant to do it.
The technical services group and the legal team of IC also said they have a non-disclosure agreement with PhilHealth when it comes to the release of the findings.
In March this year, PhilHealth President and Chief Executive Officer Dante Gierran admitted that the agency is “slow” in settling the unpaid claims of private and public hospitals because of the Covid-19 pandemic.
PhilHealth recently said it is working double time to process the remaining P25.6 billion in claims received from the hospitals, adding it has already paid a total of P166 billion in claims.
National Treasurer Rosalia V. de Leon also earlier said in March that PhilHealth’s fund life is seen to shorten by six months from August 2028 to February 2028 due to the proposed deferment of the premium hike and the expected reduction in the number of payors amid the Covid-19 pandemic.
According to de Leon, PhilHealth is projected to book a net loss of P17.5 billion this year with the deferment in the premium rate increase and the decline in the number of payors.
However, she said this would be covered by the reserve fund which will be reduced from P160.6 billion to P143.5 billion. De Leon added PhilHealth’s total liabilities, including its contingent liabilities, had already amounted to P6.09 trillion as of end-2020.
Early this year, PhilHealth had announced that it is temporarily deferring the implementation of its scheduled premium contribution rate hike to 3.5 percent from 3 percent for direct contributors following President’s directive.
Gierran said an “interim arrangement” will be good until Congress passes a new law allowing the deferment of scheduled premium adjustment in the Universal Health Care law.