Philippine Health Insurance Corporation
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The Philippine Health Insurance Corporation (PhilHealth) was created in 1995 to create a universal health coverage for the Philippines. It is a tax-exempt, government-owned and government-controlled corporation (GOCC) of the Philippines, and is attached to the Department of Health. It states its goal as insuring a sustainable national health insurance program for all. In 2010, it claimed to have achieved "universal" coverage with 86% of the population, although the 2008 National Demographic Health Survey showed that only 38 percent of respondents were aware of at least one household member being enrolled in PhilHealth. Nevertheless, this social insurance program provides a means for the healthy to pay for the care of the sick and for those who can afford medical care to subsidize those who cannot. Both local and national government allocate funds to subsidize the indigent.
- 1 Mandate and Functions
- 2 Funding and Revenues
- 3 Patient groups
- 4 Coverage
- 5 Benefits
- 6 Service delivery system
- 7 Structure
- 8 Provider Payment Mechanism
- 9 Monitoring and Evaluation
- 10 Fraud and Controversies
- 11 History
- 12 References
- 13 External links
Mandate and Functions
In 2000 and 2005, reform efforts were outlined to make decentralization and health insurance work more effectively, including an expanded government subsidy for the enrollment of the poor, the creation of local health service delivery/planning units to reduce fragmentation, and a stronger DOH role in regulation.
PhilHealth has four categories of enrollees encompassing nearly the entire population. The "formal" sector is for workers employed by companies and other institutions. Indigents have no means of support. Retirees (non-paying members) have already paid premiums for 120 months of membership and are 60 or older. The individual paying program (IPP) is for those not eligible for the other three categories. Although treated separately, the Overseas Filipino Workers (OFW) program can be considered as part of the IPP category.
Since 1996, the benefits package and delivery system have improved. For example, PhilHealth now has an Outpatient and Diagnostic Package limited to indigent enrollees. This addition creates nearly comprehensive coverage for indigents. All other beneficiaries have access to nearly comprehensive services, excluding some outpatient care. PhilHealth introduced an accreditation program for private hospitals.
Some key reform indicators to date include:
- Estimated coverage is 83% as of June 2009[update]
- Average period for payment of providers is estimated at 70 to 75 days. The law requires PhilHealth to reimburse providers and/or members within 60 days. A recent move as of December 1, 2009[update], implemented a “simplified reimbursement scheme” wherein 75% of the claims amount is reimbursed after a rapid assessment of member and provider eligibility and the remaining 25% follows after detailed review of the claims.
On average, 90 out of every 100 claims are paid, 3 to 4 are denied, and 6 to 7 are returned to health care providers for more information. 28% of claims were submitted by public providers and 72% by private providers.
Funding and Revenues
Funding varies based on the population covered, although the majority of funds flow from general taxation. Premiums for the formal sector reach up to 3% of monthly income. Premiums for both the poor and the informal sector are 1,200 pesos annually (about 25 USD). However, the cost of insurance for the poor is fully subsidized by the central and local governments. The National government allocates more than 9 billion pesos annually to meet its target.
|Formal||Employer and worker each pay half, up to 2.5% (maximum of 3%) of income up to 30,000 pesos||As of hire date||3 months|
|Indigent||1,200 pesos annually||Local government handles enrollment annually.||None|
|Retiree||Free||Age 60 with 10 years of premium payments||
|Individually Paying||1,800 pesos annually for members earning P25,000 and below
3,600 pesos annually for members earning more than P25,000
|OFW (Landbased)||1,200 pesos annually||Emigration date||No subsidy. Payment is on emigration date then annually.|
All premiums are pooled nationally and in effect, there is cross-subsidization across districts. National government payment is dependent on the availability of funds.
The benefits package is essentially the same for each group. The exception is for indigents and the Overseas Filipino Workers (OFWs) who have additional outpatient primary care benefits (with the providers paid by capitation) however these benefits are available only through public providers.
PhilHealth beneficiaries have access to a nearly comprehensive package of services, including inpatient care, catastrophic coverage, ambulatory surgeries, deliveries, and outpatient treatment for malaria and tuberculosis. Those identified as indigent and OFW are also entitled to outpatient primary care.
Inpatient care includes room and board, medicines, diagnostic and other services, professional fees and operating room services. These benefits are subject to some limits, which differ based on the level of the health facility/hospital (level 1 to 4 hospitals and the Ambulatory surgical centers equivalent to level 2 hospitals) and the severity of the cause of admission (case-type A, B, C and D). Catastrophic conditions, ambulatory surgeries including ambulatory dialysis, deliveries and outpatient malaria and TB-DOTS care.
Except for the outpatient primary care that the poor and OFWs are entitled to via public providers, patients have free choice of providers, both public and private.
Annual or lifetime coverage limits exist. These limits are expressed in terms of volumes of services (e.g., days) rather than a peso coverage limit. For example, households are eligible for 45 days of inpatient admission, sharing 45 days among all household members. Each day of ambulatory surgery counts as a day of admission.
Providers are allowed to charge the patient the difference between the total cost of care and what PhilHealth pays (i.e., balance billing).
Service delivery system
The service delivery system includes both public and private centers; on average, 61% of the network's providers are private and 39% are public. In order to achieve accreditation, all in-network hospitals and day-surgery centers must be licensed by the Department of Health.
The network includes hospitals, day surgery centers, maternity care clinics, midwife-operated clinics, freestanding dialysis centers, physician clinics, dentists doing procedures in hospitals and day surgeries, government-run health centers for primary care benefits, TB-DOTS and malaria, and private TB-DOTS clinics.
Non-hospitals and day-surgery centers are not required to be licensed by the DOH; however, all facilities are evaluated by an accreditation team from PhilHealth.
The scheme is entirely administered by PhilHealth, a government corporation attached to the Department of Health. PhilHealth collects premiums, accredits providers, sets the benefits packages and provider payment mechanisms, processes claims, and reimburses providers for their services.
PhilHealth is responsible for oversight and administration of public sector insurance schemes. It has a governing board chaired by the Secretary of Health with representation from other government departments (ministries) and agencies, and the private sector including the OFW sector.
PhilHealth has a governing board of 13 individuals, chaired by the Secretary of Health, with the President and CEO of PhilHealth as Vice-Chairman. While the law, RA 7875, that created the National Health Insurance Program provides that the President and CEO has a fixed term of 6 years, with the passage Republic Act 10149 or the "GOCC Governance Act of 2011", the President and CEO of PhilHealth now has a term of one (1) year (Section 17, RA 10149) to be elected among the ranks of the Board of Directors and subject to the disciplinary powers of the Board and may be removed for cause (Section 18, RA 10149).
Salaries and other operating expenses are derived from premium payments and the income of the funds under management. PhilHealth can use up to 12% of the previous year’s premium and 3% of the income of the fund it manages towards operating expenses.
Congress mandated that the National Institutes of Health (based in the University of the Philippines) to conduct studies to verify and validate performance.
Provider Payment Mechanism
Provider payment methods differ based on the type of care delivered. Fee-for-service reimbursements are used for inpatient care, most day surgeries, and ambulatory procedures, while primary care providers are reimbursed based on a capitation system. For TB-DOTS treatment, malaria care, deliveries, surgical contraception, and cataract surgeries, a case-based payment methodology is utilized.
No formal system sets deductibles or co-payments for beneficiaries, but health care providers are allowed to “balance bill”, charging patients the balance between what PhilHealth pays and the total cost of care. This is atypical of most government health programs around the world and can lead to abuse by providers (e.g., overcharging) and thus limited access for the poorest. At the same time, balance billing allows providers additional cost recovery in the case that the reimbursement for services does not cover their cost.
PhilHealth currently leverages internally-developed quality standards. A new set of standards called the “PhilHealth Benchbook” was implemented starting January 1, 2010. The Benchbook was developed by PhilHealth with the assistance of various international health partners and several rounds of consultations with health providers.
The previous and new quality standards are overseen by PhilHealth. The new quality standards focus on patient rights, organizational ethics, patient care, leadership and management, human resource management, information management, safe practice and environment and mechanisms of improving performance. As of 2011, hospitals accreditedation is good for up to 3 years. PhilHealth accreditation staff physically check and verify compliance. PhilHealth has peer review committees mostly composed of health care providers who review specific cases.
PhilHealth planned to implement quality-based purchasing but had not executed on this plan as of December 2009[update].
PhilHealth has been developing incentive payments focused on payment to health care professionals. Doctors are usually independents who ‘practice’ in hospitals. Salaried government physicians are allowed to also engage in private practice. Efforts to implement case payments essentially focus on bundling the payment for the health facilities.
Among PhilHealth’s work in incentive-based payments is a scheme that has been piloted in 30 local government hospitals since 2002 but has not spread. The scheme is called the Quality Improvement Demonstration Study (QIDS). It utilizes clinical vignettes to measure quality of care. If a hospital meets a set quality of care index score, physician payments are increased. Clinical vignettes focus on the illnesses of children less than six years of age.
Another incentive scheme is increased payment for health professionals practicing in areas where there is a lack of doctors.
Claims processing is manual. Hospitals or members fill out claim forms that are then submitted to PhilHealth within 60 days from hospital or health facility discharge. Two forms are usually submitted: One documents the member and premiums paid. The other details the service provided. Claims are submitted to 17 regional claims processing centers. These centers initially review claims for eligibility. Review is input manually with data encoded into the claims processing information system. Once the claim is approved for payment, checks are prepared for the signature of regional heads. Electronic reimbursements are planned but not implemented.
Monitoring and Evaluation
PhilHealth conducts its own monitoring and evaluation, though the law mandates that the University of the Philippines' National Institutes of Health engages in monitoring of the scheme. Evaluations on the PhilHealth program are ongoing.
The Department of Health (to which PhilHealth is an attached agency) monitors and analyses data, including number and value of claims, number of accredited providers, number and value of premiums paid, number of members, etc.
Fraud and Controversies
In 2011 fraudulent claims against the state-health insurer were estimated at 4 billion pesos. It failed to prosecute erring doctors and hospital. AFP Medical Center, St. Luke’s Hospital, Philippine Orthopedic Hospital, University of Sto. Tomas Hospital, East Avenue Medical Center, Cardinal Santos Medical Center, Medical City, National Kidney, General Santos District Hospital (GSDH) and Transplant Institute were investigated for health insurance fraud. In Iloilo, eye doctor claims 2, 071 operations amounting to P16 million professional fees in 2006. A hospital in Davao City notice that a janitor lying in bed and claiming to be a PhilHealth accredited patient. In 2006 PhilHealth revoked the accreditation of Sara Medical Clinic in Midsayap for ghost patients.
The Philippine Medical Care Program began in 1971 following the Philippine Medical Care Act of 1969. It mandated creation of the Philippine Medical Care Commission (PMCC). In 1990 bills passed that led to significant improvement of public health care insurance. House Bill 14225 and Senate Bill 01738 became Republic Act 7875, known as "The National Health Insurance Act of 1995". Approved by President Fidel Ramos on February 14, 1995. This become the basis of the Philippine Health Insurance Corporation. On its 16th anniversary the song "PhilHealth: Tapat na Serbisyo, Tapat na Benepisyo, Lahat Panalo" was introduced.
- "R.A. 7875 AN ACT INSTITUTING A NATIONAL HEALTH INSURANCE PROGRAM FOR ALL FILIPINOS AND ESTABLISHING THE PHILIPPINE HEALTH INSURANCE CORPORATION FOR THE PURPOSE". Retrieved 2011-07-06.
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- Balana, Cynthia (09/29/2010). "PhilHealth doubles premiums". Philippine Daily Inquirer. Retrieved 2011-05-06.
- "PREMIUM SUBSIDY FOR INDIGENTS UNDER THE NATIONAL HEALTH INSURANCE PROGRAM". Department of Budget and Management. Retrieved 2011-05-06.
- Crisostomo, Sheila. "Phl eyes Mexico as model for PhilHealth expansion". The Philippine Star. Retrieved 2011-07-07.
- "Based on 2008 claims reports". PhilHealth website. 2008-12.
- "Extending Health Care to all Filipinos". Retrieved 2011-07-07.
- "DOH sets massive, open PhilHealth registration". Retrieved 2011-07-07.
- Espejo, Edwin (May 26, 2011). "Philippines: How to cure PhilHealth’s woes?". Asian Correspondent. Newsbreak. Retrieved 2011-07-06.
- Espejo, Edwin (May 25, 2011). "Bogus claims haunt PhilHealth". Newsbreak. Retrieved 2011-07-06.
- Espejo, Edwin (May 25, 2011). "Bogus claims haunt PhilHealth". Newsbreak. Retrieved 2011-07-06.
- "REPUBLIC ACT No. 6111". Law Phil. Retrieved 2011-07-07.
- "Philippine Health Insurance Corporation celebrates 15th Anniversary". 2010-10-01. Retrieved 2011-07-07.
- "PhilHealth Corporate Profile". Retrieved 2011-07-07.