Health Secretary Teodoro Herbosa, along with members of the Philippine Health Insurance Corp. (PhilHealth) board, on Monday approved a P284-billion corporate operating budget (COB) for 2025, the Department of Health (DoH) announced Tuesday.

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

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

The board also approved the benefits committee-endorsed second round of increases in selected case rates, by as much as 50 percent.

These include emergency care benefits, eye care like eyeglasses and optometric services for children, open heart surgery coverage and pediatric cataract removal.

The COB 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 the accumulated net income (also known as accumulated revenues) over the years of P431 billion, minus the reserve fund ceiling of P281 billion.

The 2025 COB includes P271 billion allocated for benefit expenses, reflecting an 11-percent increase compared to 2024.

This increase accounts for board-approved adjustments in case rates, Z benefits, PhilHealth Konsulta with capitation rates of P1,700 and P2,100 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 stand-alone 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 2024 to P12.5 billion in 2025.

Capital expenditures in the PhilHealth COB for 2025 are set at P259 million, a 91-percent reduction compared to the approved amount of P2.9 billion in 2024.

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 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 expressed concern over “fake” posts on social media claiming that PhilHealth was allocated a zero budget for 2025.

“It is wrong when people say that PhilHealth does not have a budget. It does. 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 PhilHealth will not receive a government subsidy for 2025, citing its reserve funds amounting to P600 billion.