The Universal Health Care (UHC) Act was hailed as the most significant law to protect Filipinos’ health because it aimed to provide free hospitalization and medicine to all Filipinos.

But a law without funding is not a law but a mere statement of aspirations that the government has chosen not to honor by marginalizing the Philippine Health Insurance Corp. (PhilHealth), which the law mandated as its implementor.

The pattern from 2022 to 2025 reveals a government that has treated PhilHealth’s legally mandated budget as a discretionary fund to be allocated last, reduced at will, and, in 2025, eliminated from the annual budget.

When the Supreme Court (SC) ruled that raiding PhilHealth’s reserves was unconstitutional, it acknowledged what advocates had been warning for years: that the social contract embedded in Republic Act (RA) 11223 was being actively dismantled.

When RA 11223, or the UHC Act, was signed into law in 2019, it represented one of the most ambitious social contracts the government had ever made with its people.

At the center of that promise was PhilHealth, mandated to serve as the universal insurer, covering premiums for the poorest and most vulnerable Filipinos: senior citizens, persons with disabilities, indigents, and marginalized communities.

That promise is being systematically broken through years of deliberate underfunding and, most damagingly, the unconstitutional diversion of P60 billion from PhilHealth’s own reserve funds.

The gap between what PhilHealth is legally entitled to receive and what it actually gets has widened dramatically every single year.

The shortfall was P226 billion in 2022, P247 billion in 2023, P273 billion in 2024, and P330 billion in 2025.

In 2025, the government transferred zero pesos to PhilHealth despite a legally mandated requirement of P330 billion, representing a complete abandonment of the UHC Act’s financing framework.

Under RA 11223, PhilHealth is entitled not only to direct government subsidies but also to earmarked revenues from sin taxes on tobacco, alcohol, and sugary beverages, as well as allocations from the Philippine Charity Sweepstakes Office (PCSO) and the Philippine Amusement and Gaming Corp. (PAGCOR). Despite being legal obligations, they have been withheld year after year.

Chronic underfunding alone would be damaging enough. But on top of it, the government went further, by diverting P60 billio tn directly from PhilHealth’s existing reserve funds, money that legally belonged to the health insurance system and the Filipino patients it serves.

On 5 December 2025, the SC declared this diversion unconstitutional. The Court recognized that stripping PhilHealth of its reserves, while simultaneously withholding its mandated subsidies, was an act that caused direct, foreseeable, and severe harm to millions of Filipinos.

The health sector wanted officials responsible for the perversion of PhilHealth funds held accountable.

The funding gap translates directly into suffering — most acutely for those the UHC Act was specifically designed to protect.

PhilHealth has acknowledged P59.6 billion in unpaid claims, with an additional P8.8 billion in denied late claims.

Government hospitals, the frontline institutions serving the poorest Filipinos, reported P15 billion in overdue reimbursements, with 45 percent of those bills unpaid for more than two years.

Hospitals operating on thin margins cannot absorb those losses without cutting services, reducing staff, or deferring investments in equipment and capacity.

When hospitals face liquidity crises due to PhilHealth’s inability to reimburse them, the costs are passed on to patients.