Health Secretary Teodoro Herbosa, along with members of the Philippine Health Insurance Corp. (PhilHealth), on Monday approved a P284 billion Corporate Operating Budget (COB) for Fiscal Year (FY) 2025, the Department of Health (DoH) announced Tuesday.

The total amount is 10 percent higher than the previous year’s P259 billion COB, according to DoH, which administers PhilHealth.

The COB is PhilHealth’s version of a General Appropriations Act.

The Board also approved the Benefits Committee (BenCom)-endorsed second round of increases in selected case rates, by as much as 50 percent.

This is in addition to an emergency care benefit, glasses and optometric services for children, open heart surgery benefits, and pediatric cataract extractions.

The Board-approved COB 2025 already factors in the zero government premium subsidy for indirect contributors for 2025, as decided by the Bicameral Conference Committee of Congress.

It includes computations by PhilHealth Management of a P150 billion surplus as of 31 October.

The formula used is accumulated net income (also known as accumulated revenues) over the years of P431 billion, minus the Reserve Fund ceiling of P281 billion.

Within the 2025 COB is the amount of P271 billion programmed for benefit expenses, higher by 11 percent compared to FY 2024.

This increase takes into account Board-approved increases in case rates, Z benefits, PhilHealth Konsulta at P1,700 and P2,100 capitation per person, and 156 hemodialysis sessions at P6,350 per session.

It also includes funds for emergency care, outpatient mental health, severe acute malnutrition, and many other standalone outpatient packages.

Despite the increase in the budget for benefits, the Board approved an increase of only three percent for administrative expenses, from P12.1 billion in FY 2024 to P12.5 billion in FY 2025.

Capital expenditures in the PhilHealth COB 2025 were pegged at only P259 million, which is 91 percent less than the approved equivalent in FY 2024 at P2.9 billion.

The Board observed that Management used only eight percent of its COB 2024 for the purchase of information and communications technology (ICT) and other capital expenditures.

While it did not grant a new ICT budget for FY 2025, the Board extended the validity of the COB 2024 for ICT projects in the amount of P989 million to ensure that digitalization is prioritized.

“PhilHealth has a lot of money, well over the reserve fund ceiling allowed by law. This surplus is a result of underspending for benefits through the years, which is why Filipino families pay high out-of-pocket,” Herbosa, who chairs the PhilHealth Board of Directors, explained.

“The Board approved higher benefits and a budget for 2025 that recognizes the need for PhilHealth to spend more so that families will spend less,” he added.

On Monday, Herbosa lamented as “fake” posts on social media claiming PhilHealth was given zero budget for 2025.

“It is wrong when people say that PhilHealth does not have a budget. There is. The budget to be [approved] by the PhilHealth Board is huge: P284 billion is the budget for 2025.”

Senate Committee on Finance Chair Senator Grace Poe said that PhilHealth will receive no government subsidy for 2025, citing its reserve funds amounting to P600 billion.