Painful but necessary hikes

The hikes for health coverage are hard to accept because of grave trust issues, concerns over where exactly the additional funds will go to.


December 22, 2022

MANILA – As if the hefty and successive increases in the prices of basic goods and services were not enough, the new year will also see weary Filipinos shelling out more money for their health coverage with the Philippine Health Insurance Corp. (PhilHealth) and contribution to the Social Security System (SSS).

PhilHealth is set to increase its premium rate to 4.5 percent from 4 percent effective January 2023, the latest in the scheduled increases under the Universal Health Care Act that began in 2019, and will end in 2025 with the premium rate rising to 5 percent, ostensibly to give Filipinos “adequate access to medical services and financial protection.”

The increase to 4.5 percent in January means members earning P10,000 a month will contribute P450, instead of P400.

PhilHealth corporate communications manager Rey Balena had said that the increase could be considered an “investment” for the health of members and their families, as it would mean enhanced benefit packages, including the expanded primary care benefit package, outpatient package for mental health, continuing COVID-19 benefit package, and comprehensive outpatient benefits.

“The guarantee of the Universal Health Care Law is that the benefits will not regress, but just continue to expand and improve,” Balena said.

Also in January, SSS will increase its contribution rate to 14 percent from 13 percent, as part of the implementation of the Social Security Act of 2018 that promises to translate the higher contribution—up to 15 percent by 2025—to a stronger and more viable fund that will be in a better position to provide more benefits to the members, according to SSS president and chief executive officer Michael G. Regino.

For employed members, their employers will shoulder the 1-percent increase in the contribution rate. On the other hand, individual paying members, such as self-employed, voluntary, nonworking spouse, and OFW members, will shoulder the whole contribution rate since they have no employers.

As expected, opposition to these hikes has been mounting, given that most Filipinos’ spending power has been weakened considerably by the spike in the prices of everyday staples including sugar, onions, meat, and vegetables. Fuel prices likewise surged since Russia’s invasion of Ukraine in February this year, leading to a cascade of increases in transportation and electricity. As a result of these price surges, inflation has accelerated to 8 percent in November—the highest since 2008—with the rate yet to hit its peak.

Employers Confederation of the Philippines (Ecop) and the Philippine Chamber of Commerce and Industry have, thus, urged President Marcos Jr. to consider postponing the scheduled hikes in the PhilHealth and SSS contributions for at least a year, just to give affected Filipinos more time to recover from high inflation and for PhilHealth to get its house in order.

Ecop president Sergio Ortiz-Luis Jr. had said that increasing the premiums amid high inflation would hurt both workers and the small businesses, especially since employers are expected to shoulder the entire 1-percentage point increase in the contribution to SSS. He also told this paper that with the controversies and liabilities of PhilHealth, “we don’t feel it’s fair that they’ll be increasing” its rate.

Last July, Sen. Grace Poe also filed a bill seeking to allow the President to postpone the increase in the PhilHealth contribution, saying it “comes at a time when people continue to grapple with the impact of the pandemic and the soaring prices of basic needs.’’

These hikes are also hard to accept because of grave trust issues, concerns over where exactly the additional funds will go to.

It does not help PhilHealth’s cause, for example, that it has been involved in multiple controversies, including the presence of a supposed “mafia” that has stolen as much as P15 billion from the state health insurer through various fraudulent schemes, then the SSS funds were being considered to be used to fund the proposed Maharlika Investment Fund.

There is no question that the increase in the contributions to PhilHealth and SSS is necessary, to ensure the financial viability of the two vital government institutions that will, in turn, guarantee that promised benefits to current and future members will be given, especially to the retirees who are counting solely on their SSS benefits to tide them through their old age. Perhaps the issue is the right timing.

But as Mr. Marcos considers these proposals, his administration that still has the benefit of the goodwill of Filipino voters should justify the increases with not just promises of increased benefits for PhilHealth and SSS members, but also corresponding commitments of increased accountability, from tighter financial controls to avowed intolerance for graft and corruption of unscrupulous officials, who will not hesitate to dip into these hard-earned funds for their nefarious activities.

Only then will it become easier to accept these painful but ultimately necessary increases now to ensure benefits in the future.

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