Press Release
October 8, 2010

Recto to Philhealth: Bargain for lower out-of-pocket costs of healthcare

Sen. Ralph G. Recto yesterday said the Philippine Health Insurance Corporation (PhilHealth) should use its hefty benefits payouts as leverage to negotiate for lower healthcare costs in both public and private hospitals in order to reduce out-of-pocket payments made by its members.

Recto said that PhilHealth paid a total of P24.3 billion in 2009 for its members' benefits, which in reality had been paid to hospitals and healthcare providers.

"In a manner of speaking, paying over P24 billion for the health benefits of PhilHealth members is like paying in bulk or in volume for a product or service. And with that huge amount, you can easily bargain for discounts and lowered or special rates," he said.

"For practically being one of the healthcare system's top customers, PhilHealth is entitled to some perks. It is a big spender or a high roller of some sort. In turn, it can pass whatever perquisite it acquires to its members."

The senator said that during the budget hearing of the Department of Health (DOH) last Wednesday at the Senate, Health Secretary Enrique Ona himself confirmed that about 20% to 40% of the income of private hospitals comes from PhilHealth payments of its members' benefits.

"Unfortunately, people still pay high out-of-pocket costs to acquire quality healthcare even with health insurance provided by PhilHealth. In some instances, up to 90% of the bill is still being shouldered by the member or his dependents," Recto explained.

For instance, he said, PhilHealth can negotiate with an accredited hospital for lower room rates or cheaper laboratory expenses for its members.

"The possibilities are endless. PhilHealth should develop a mindset of enabling its members to afford an otherwise high cost of health services in the country. If it cannot, by itself, increase its members' benefits, then the least it can do is find other ways to make quality healthcare more affordable," the senator said.

Recto had earlier urged PhilHealth to use its retained earnings, which amounts to some P110 billion, to augment the DOH's efforts to improve the country's healthcare system.

He said the government corporation's accumulated reserved fund is more than thrice the proposed budgetary allocation of the health department for next year, which is about P32.6 billion.

The senator explained that the amount could easily wipe out the country's health infrastructure deficit.

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