REPUBLIC OF THE PHILIPPINES
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS
First Regular Session

House BillNo. __ 968

and Gary C. Alejano

Explanatory Note

Government hospitals while receiving subsidy from the National Government, cannot utilize
their income for their maintenance and other operating expenses. Similar to other income
generating agencies of the government, these hospitals are required by law to remit their income
back to the national treasury.

This practice of disallowing government hospitals from spending their income for MOOE limits
the hospital's capability to expand and improve. It is precisely the primary reason that
government hospitals fail to deliver quality and efficient basic health services for the people.

In view of this counterproductive system, this representation is filing this proposed measure to
give more meaning to the autonomy of government hospitals in the area of physical and
operational development. This can be achieved by granting them the authority to utilize their
income for their maintenance and other operating expenses.

Approval of this bill, therefore, is earnestly sought.

FRAXCISCO ASHLEY L. ACEDILLO “ARY C. ALEJANO


REPUBLIC OF THE PHILIPPINES
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS
First Regular Session

House Bill No. 968

Introduced by MAGDALO Party List Representatives Francisco Ashley L. Acedillo
and Gary C. Alejano

AN ACT
AUTHORIZING GOVERNMENT HOSPITALS UNDER THE DEPARTMENT OF
HEALTH (DOH) TO RETAIN AND UTILIZE ALL THEIR INCOME AND INTEREST
DERIVED FROM DEPOSITS, FOR MAINTENANCE AND OTHER OPERATING
EXPENSES, CAPITAL OUTLAYS AND FOR OTHER PURPOSES

Be it enacted by the Senate and House of Representatives of the Philippines in Congress
assembled:

SECTION 1. Utilization of Hospital Income. - All government hospitals under the
Department of Health (DOH) are hereby authorized to retain and utilize one hundred percent
(100%) of their income, which include hospital fees from in-house services and facilities, income
derived from nonpatient-related services such as rental fees, parking fees,
affiliation/medical/professional fees, interview and tour fees, and income derived from interest

‘on account deposits, without necessarily remitting the same to the Bureau of Treasury.

SEC. 2. Trust Fund. - A trust fund constituting the income collected shall be established
for the maintenance and other operating expenses, capital outlays for the purpose of equipment
and infrastructure projects including construction, improvement and/or renovation of hospital
facility and for other purposes recommended by the Board of the said hospital: Provided, That
pharmacy income or proceeds from the sale of drugs and medicines and laboratory income shall
be considered as a revolving fund and shall be specifically utilized by the hospital pharmacy and
laboratory for purposes as may be determined by the DOH: Provided, further, That no amount of
the said income shall be used for payment of salaries and other allowances of employees.

The trust fund shall be deposited in an authorized government depository bank/ s
recommended by the DOH, the Department of Finance (DOF) and the Department of Budget and
Management (DBM).


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SEC. 3. Hospital Board. - There shall be established a board in each national hospital
retained under the DOH with the chief or head of the hospital concerned as chairman and the
following as members:

(1) A senator;

(2) A congressman of the congressional district where the hospital is located;

(3) A representative of the Philippine Hospital Association (PHA);

(4) A representative of the Philippine Medical Association (PMA);

(5) A representative of nongovernment organizations (NGOs) involved in health

services;

(6) A representative of the religious sector,

(7) A representative of the private sector; and

(8) A representative of the rank and file employees.

The Chairman of the Senate Committee on Health shall choose from among the senators
who shall represent the Senate as a member of each of the retained national hospital health
board.

The representatives from the PHA, the PMA and NGOs involved in health services,
religious sector and private sector in the hospital health boards shall be appointed by the
chairman of the respective health hoards. The representative of the rank and file employees shall
be voted upon by the entire members of the rank and file.

The hospital health board shall monitor the collection and determine the utilization of the
hospital income, and perform such other functions as may be deemed necessary for the effective
management of the said income.

‘The Board shall meet at least once a week or as often as may be necessary.

A majority of the members of the board shall be present during meetings when income
utilization proposals are prepared and considered.

Members thereof who are not government officials or employees shall be entitled to

necessary traveling expenses and allowances chargeable against the funds.


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SEC. 4. Audit and Reports... Expenditures under this Act shall be subject to existing
auditing rules and regulations. In addition, the retained hospitals shall submit quarterly reports of
income and utilization thereof to the DBM and the Committee on Health of both Houses of

Congress.

SEC. 5. Implementing Rules and Regulations.- The DOH, in coordination with the
DOF, the DBM and the Commission on Audit (COA), shall formulate the necessary rules and

regulations for the effective implementation of this Act within sixty (60) days from its approval.

SEC. 6. Separability Clause.~ If any provision of this Act is held invalid by a competent

court, any other provision not affected thereby shall continue to be valid and effective.
SEC. 7. Repealing Clause.- Any laws, presidential decree, executive orders and letters of
instruction which are inconsistent with any of the provisions of this Act are hereby repealed or

amended accordingly.

SEC. 8. Effectivity.- This Act shall take effect fifteen (15) days after its publication in

any newspaper of general circulation.

Approved,