The defunding of the P74-billion subsidy to the state health insurance fund happened during the supposed reconciliation of the 2025 General Appropriations Bill (GAB) versions of the Senate and the House.

The amount, which would have mostly gone to financing the needs of the destitute who cannot afford to contribute to the Philippine Health Insurance Corp. (PhilHealth), was reallocated to pork barrel-type programs such as the Medical Assistance to Indigent Patients (MAIP).

MAIP doles out financial assistance to those needing medical care but they have to get the endorsement of a senator or congressman.

Thus, the program undermines the aims of the Universal Health Care Act (UHC), which makes healthcare mandatory and a responsibility of the government, not reliant on the largesse of members of Congress.

After the PhilHealth subsidy was lopped off, it was Senate President Chiz Escudero and Senate finance committee chairperson Grace Poe who aggressively defended the move.

Escudero and Poe are perennial political partners, sharing, among other things, big business backers.

Escudero attributed the removal of the subsidy to PhilHealth’s “kapalpakan” or failure to efficiently utilize past government support, which led the Department of Finance to requisition P89.9 billion of the supposed excess funds.

The Supreme Court restrained the DoF but only after it had siphoned off P60 billion.

The Senate chief pointed to PhilHealth’s P600 billion in reserve funds as the rationale for removing its subsidy for 2025.

“I hope this serves as a wake-up call to them — if not a slap in the face — to do their job. It is not for us to reward their failure by giving them more money to accumulate,” Escudero said.

He then used PhilHealth’s inefficiency as an excuse to create the patronage-based MAIP.

Poe said the bicameral conference committee decided “it would be best for the state health insurer to tap into its reserve funds.”

“They need to use their reserve funds first because, as you can see, many people are upset after not receiving proper reimbursements. If we can see that they have that much money, they need to use it because it’s just going to waste,” Poe said.

The move was in defiance of the Sin Tax Reform Law and the Universal Healthcare (UHC) Law, a breach that has been challenged in the Supreme Court.

The Sin Tax law specifically earmarks funds from tobacco and sweetened beverage taxes for PhilHealth.

Indirect contributors — the poor, senior citizens, and persons with disability — are directly affected by the removal of the subsidy.

In turn, to maintain PhilHealth’s provision of healthcare to indigents, the direct contributors, many of whom are from the working class, will have to foot the bill.

The UHC also provides that any “excess PhilHealth funds” must be used to increase the benefits to members.

The reserve funds, however, are insufficient to pay PhilHealth’s insurance contract liabilities.

The bicam, at the time, was scrambling for funds to reallocate to pork barrel projects, which was the reason blanks appeared in the budget after the Senate and House members met.

The removal of PhilHealth’s subsidy and the appearance of blanks in the budget were intricately woven into the underhanded efforts of the bicam to build up discretionary funds for Congress.