Solon backs DoF proposal on Philhealth excess funds

A lawmaker on Thursday has expressed qualified support for the Department of Finance’s (DoF) proposal to tap the Philippine Health Insurance Corporation’s (PhilHealth) excess funds.

Albay Representative Joey Salceda — who also chairs the House Ways and Means Committee, argued that idle funds within government-owned corporations (GOCCs) should be used for public investment rather than remaining stagnant.

The DoF plan, outlined in Circular No. 003-2024, aims to utilize unspent funds from GOCCs like PhilHealth to finance unprogrammed appropriations and these standby funds are used for unexpected events like disasters.

“We can’t allow excess money to sit unused while public needs go unmet,” said Salceda.

However, the lawmaker highlighted concerns raised by some quarters, with some critics suspecting the unprogrammed appropriations may be diverted to fund the Maharlika Investment Fund, the government’s proposed sovereign wealth fund.

To address concerns about PhilHealth’s core mandate, Salceda stressed the distinction between PhilHealth’s revenue streams.

“PhilHealth receives taxpayer subsidies alongside member premiums,” said Salceda. “Excess taxpayer funds, not member contributions, could be used for other government needs.”

He also cited the P162 billion in taxpayer subsidies PhilHealth has received under the current administration as he acknowledged PhilHealth CEO Emmanuel Ledesma Jr.’s statement regarding P89.9 billion in unspent government allocations over the past three years.

“This suggests either over-allocation or inefficient spending,” Salceda said. “If PhilHealth can’t utilize its budget, future subsidies could be adjusted.”

While acknowledging the logic behind the DoF’s proposal, Salceda favors the current system of providing PhilHealth with a substantial annual subsidy. However, he suggests a mechanism to recover excess funds later in the year.

“PhilHealth will receive a 2025 budget allocation anyway,” Salceda said. “If they can spend it effectively, there’s no need for DoF intervention.”