THE PHILIPPINE Health Insurance Corp. (PhilHealth) plans to slash Filipinos’ out‑of‑pocket medical expenses up to 25% by 2028, PhilHealth said, noting the need to ramp up state spending to ease the burden on the public.
PhilHealth President and Chief Executive Officer Edwin M. Mercado said the state-run insurer aims to cut Filipinos’ out-of-pocket health spending to 25% to 30% in the medium term, from 44.7% in 2023.
“(That is) our objective in the medium term until 2028. Based on our back‑of‑the‑envelope computation, the national government really needs to increase healthcare spending,” he said.
This will require the health spending share of the national budget to be around 10% to 12%, he told BusinessWorld during a Philippine Institute for Development Studies (PIDS) event on Thursday.
Mr. Mercado also said the state-insurer is looking to spend 25% of its budget into primary care by 2028.
“Focusing on the primary care and also cancer screening, which accounts for the biggest portion of our inpatient expenditure, the most catastrophic cases are mostly cancer cases, would probably lead to all these deficiencies and decrease in our inpatient expenditures,” he said.
Despite higher state outlays, Filipinos still shoulder hefty medical bills, PIDS Senior Research Fellow and Health Economics and Finance Program Director Valeire Gilbert T. Ulep said.
“The government is spending more relative to its economy, but we’re still seeing a high share of out-of-pockets. So, there is somehow a disconnect there,” he said in his presentation.
Health spending increased to less than P12,000 per capita in 2024 from about P3,000 in 2000, factoring inflation.
In 2024, health spending stood at P1.4 trillion, equivalent to about 5% of gross domestic product, a level comparable to that of most countries with similar income ranges.
“If you look at the share of government spending, central, local government, and PhilHealth, around 44%. But, if we transition to an upper middle-income country, we’re still far from that because if you look at the average for upper middle-income country, it’s 60%,” he said.
He noted that the government’s share of total health spending remains low, as households continue to shoulder a disproportionately high share of out‑of‑pocket costs.
In addition, Mr. Mercado said the agency is working with the Department of Information and Communications Technology to develop a dashboard by 2026-2027, to track real‑time hospital performance indicators, including patient length of stay and denial rates. — Aubrey Rose A. Inosante
