THE Department of Finance (DoF) rejected claims that it inflated its estimate of reserves held by the Philippine Health Insurance Corp. (PhilHealth) by P28.08 billion to justify the government’s raid on the health insurer’s funds.
“The presentation is faithful. PhilHealth adopts an accrual basis of accounting for both revenue and expense recognition. This means that revenue and expenses have both cash and non-cash components,” the DoF told BusinessWorld on Monday.
These allegations were raised by Juan Antonio Perez III, a former undersecretary for Population and Development and member of the Universal Health Care Collective.
Mr. Perez alleged that Finance Secretary Ralph G. Recto made inaccurate statements during a Senate hearing on July 30 regarding PhilHealth’s excess funds.
He presented these claims during a briefing in Quezon City on Monday.
“PhilHealth actually reported that year that the DBM (Department of Budget and Management) had not fully released the premium subsidy, withholding P28.08 billion meant for 12,618,921 National Household Targeting System indirect members,” he said in the statement, referring to a program benefiting poor households.
Mr. Perez said this led to a P12-billion deficit for PhilHealth in 2023 when “it paid out that much more for claims of indirect members.”
“The Department of Finance failed to disclose this to the Senate on July 30 when it reported “excess funds” amounting to P89.9B, bloating that figure by 31%,” he said.
The DoF said that “Fund Balance calculation of the Executive deducted the accrued, non cash expenses of PhilHealth for indirect contributors.”
In April, PhilHealth was ordered to remit P89.9 billion to the Bureau of the Treasury, on the strength of a provision in the 2024 budget that allowed the government to tap reserve funds held by government-owned and -controlled corporations.
The Supreme Court (SC) later issued a temporary restraining order preventing the further transfer of P29.9-billion tranche after three transfers.
The SC has scheduled oral arguments on Feb. 4 for challenges to the transfer of the P89.9 billion in excess funds.
“Clearly, the DoF wanted to project a picture of financial stability and excess cash in the corporation to justify its unconstitutional cash sweep in 2024,” Mr. Perez said.
He also said that this “false narrative” led Congress to justify stripping the subsidies for the PhilHealth in the 2025 General Appropriations Act. — Aubrey Rose A. Inosante