Ten things about the P90 B PhilHealth excess funds and unprogrammed appropriations

The Supreme Court issued last Tuesday a temporary restraining order (TRO) directing the Philippine Health Insurance Corp. (PHIC or PhilHealth) not to transfer the remaining P29.9 billion out of P89.9 billion in excess funds for 2024 to the National Treasury.

- Bienvenido S. Oplas Jr.

It is time to revisit some facts about this fund and related issues.

First, that P90 billion is not from PhilHealth members' premium payments. Members' yearly contributions from 2021 to 2023 ranged from P106 billion to P158 billion, while benefits claimed ranged from P85 billion to P153 billion over the same period. So members' contributions are intact and not diverted to other sectors in unprogrammed appropriations (UA).

Second, that P90 billion is derived from a portion of remittances from PAGCOR and PCSO, and a portion of tax revenues from alcohol and tobacco. On average, this amounts to P80 billion per year from 2021 to 2023, accumulating yearly. Thus, these are funds from bettors and gamblers, as well as from drinkers, smokers and vapers of legal tobacco products, since illicit and smuggled tobacco and alcohol do not pay taxes.

Third, the UA was created because programmed appropriations are already numerous. The regular and funded expenditures are so high that current and projected revenues will not be able to keep up, leading to a huge yearly budget deficit (revenues lower than expenditures) and substantial annual borrowing. From January to September 2024, interest payments alone for our public debt amounted to P583.3 billion, and the budget deficit reached P970.2 billion. At these rates, the full-year 2024 interest payment may reach P875 billion, and the budget deficit may reach or exceed P1.44 trillion.