SEVENTEENTH CONGRESS OF THE __)
REPUBLIC OF THE PHILIPPINES ) .
Second Regular Session ) 18 FER 27 P6 22

SENATE

S.B.No. 1714 acer ¢—

Introduced by Senator Ana Theresia “Risa” Hontiveros-Baraquel

AN ACT
INSTITUTING AND INSTITUTIONALIZING REFORMS IN THE HEALTH
SECTOR TO ACHIEVE UNIVERSAL HEALTH CARE FOR ALL FILIPINOS

Explanatory Note

Despite increasing investments in health and the huge effort on the part of the
government to achieve its international developmental commitments in the past 10
years, the country is still a long way from achieving our goal of obtaining better health
outcomes and achieving universal health care for all Filipinos. There remains an
imbalance in terms of health status among the different economic sectors of the
population. Various studies done by government agencies like the Food and Nutrition
Research Institute and the Philippine Statistics Authority consistently point out that
both health outcome indicators and service coverage rates for essential public health
programs are lowest among the poorest Filipino families,

Furthermore, complaints persist on the state of hospitals and health facilities in the
public sector, which caters to the poorer segments of the population, Despite the
reported 90% coverage rate of the National Health Insurance Program (NHIP), indigent
Filipino families still have difficulties getting access to a variety of preventive, curative,
and rehabilitative health services.

Numerous factors have been cited as barriers to achieving the country’s health goals.
Among them are the fragmentation of health services as a result of the devolution of
health services, lack of clear delineation of functions among government entities in
implementing health goals, lack of resources for health at the LGUs, lack of information
among the poorest families on their health entitlements and on how to navigate through
the health system.

Reform initiatives done in the health in the past two decades were mainly attempts to
address these challenges. Earlier attempts to address the fragmentation of the health
system included incentivizing local government units to engage in  inter-local
cooperation and_province-wide investment planning. However, considering the
resources from the national government were not large enough to influence LGU
behaviours, the potential of these initiatives was not fully realized. The more recent
effort mostly involved direct transfers from the National Government to LGUs of public
health commodities, health human resources through its deployment programs, health
insurance in the form of full subsidy of the premiums of the poor, and capital outlay for
various health facilities. All of these were aimed at assisting the local government units
perform their mandates of providing quality health care.

There were also efforts to focus on community empowerment through the deployment
of community health teams which sought to go the extra mile to reach poor families at
the margins who did not usually access health services. A more critical function of these



community health teams was to inform families of their health entitlements and to aid
families in navigating through various levels of health facilities.

While these reform initiatives have definitely moved the health sector forward, the
inequities in terms of access to health persist. An argument can be made that the reason
why the benefits from these efforts have not been fully realized is due to the lack of scale
and consistency in implementing these reforms. Another is that the legal framework
that will enable these reforms to be implemented more effectively and efficiently is
lacking.

This bill seeks to institutionalize past reform initiatives and to institute new ones as a
means to achieve universal health care for all Filipinos. It primarily mandates that all
Filipinos are included in the National Health Insurance Program and ensures that each
and every Filipino, especially the poor, is assigned to a network of facilities that can
provide their health needs.

The bill seeks to address barriers in health governance, health human resources,
regulations, service delivery, and health information that would prevent Filipinos from
accessing care. First, it seeks to address the issue of fragmentation of health care
delivery system by providing a framework for the integration of the health system at the
level of provinces and highly urbanized cities, and by defining the minimum
requirements of a service delivery network. Further, the bill seeks to strengthen
community empowerment through emphasizing the role of community health workers
in service provision, health education, health navigation, among others. It also details
and delineates the roles and functions of different stakeholders within the health sector.
Finally, the bill also institutes changes in the operations of the Philippine Health
Insurance Corporation to enhance its delivery of benefits to all Filipinos.

In view of the foregoing, and in order to ensure a healthier Philippines, immediate
passage of this bill is earnestly sought.

“itcreala Sea Hontiberosena
Ana Theresia “Risa” Hontiveros-Baraquel

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weIdaAnEewne

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SEVENTEENTH CONGRESS OF THE )

REPUBLIC OF THE PHILIPPINES. )
Second Regular Session ) 18 R27 P62
SENATE
s.B.No. 1714 mean CP

Introduced by Senator Ana Theresia “Risa” Hontiveros-Baraquel

AN ACT
INSTITUTING AND INSTITUTIONALIZING REFORMS IN THE HEALTH
SECTOR TO ACHIEVE UNIVERSAL HEALTH CARE FOR ALL FILIPINOS

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

CHAPTER 1
GENERAL PROVISIONS,

SECTION 1. Short Title. — This Act shall be known as the “Healthy Pinoy, Healthy
Pinas Act”.

SECTION 2. Declaration of Principles & Policies. It is the declared policy of the State
to protect and promote the right to health of every Filipino and instill health
consciousness among them, recognizing the intimate link of the health and well-being of
citizens with national development and progress. Towards this end, the State shall adopt
an integrated and comprehensive approach to ensure that every Filipino is health
literate, is provided healthy living conditions and protected from hazards and risks that
could affect their health, provided access to a comprehensive set of cost-effective and
quality promotive, preventive, curative, rehabilitative and palliative health services the
cost of which will not cause financial hardship, and participate in planning and
implementation of their health system.

SECTION 3. General Objectives. — This Act seeks t
a. Realize universal health coverage for all Filipinos by institutionalizing previous
health reform initiatives and instituting key systematic and systemic reforms;

b. Establish clear delineation of roles and functions of key agencies and
stakeholders in pursuing these reforms;

c. Integrate local health systems at the level of the province and highly urbanized
and independent cities and define the minimum service capacities of the service
delivery networks;

d. Strengthen the National Health Insurance Program (NHIP) established under
Republic Act No. 7875, as amended, otherwise known as the “National Health;
Insurance Act of 2013” as the national purchaser of health goods and services;

e. Catalyze strategies that ensure availability of or constant supply of goods and
services, and health care professionals especially in underserved areas;

SECTION 4. Definition of Terms. — As used in this Act,

a. Beneficiary refers to any person entitled to health insurance benefits under this
Act;



. Contribution refers to the amount paid by or in behalf of a member to the

National Health Insurance Program in order to enjoy coverage thereof, based on
salaries or wages, and on household earnings and assets in the case of
contributory group, or on other criteria as may be defined by the Philippine
Health Insurance Corporation in accordance with the guiding principles set forth
in this Act;

. Co-payment refers to a payment made by a member or beneficiary as a fixed

amount, with the remaining cost of health services covered for by the insurer;

Coinsurance refers to the portion of the reimbursement fixed by the National
Health Insurance Program to be paid by the member or beneficiary from the total
cost of health services with the remaining balance covered by the Philippine
Health Insurance Corporation;

. Drug refers to a chemical substance used in the treatment, cure, prevention, or

diagnosis of disease, or used to otherwise enhance physical or mental well-being,
which has been approved by the Food and Drug Administration (FDA) and can be
dispensed only pursuant to a prescription order from a physician who is duly
licensed to do so;

Emergency refers to an unforeseen combination of circumstances which call for
immediate action to preserve the life of a person, or to preserve the sight of one
or both eyes; the hearing of one or both ears; or one (1) or two (2) limbs at or
above the ankle or wrist;

; Entitlement refers to any singular or lot of health services provided to members

or beneficiaries of the Program for the purpose of improving health;

. Health care provider refers to any of the following:

1. A health facility, which may be public or private, devoted primarily to the
provision of services for health promotion, prevention, diagnosis,
treatment, rehabilitation and palliation of individuals suffering from
illness, disease, injury, disability, or deformity, or in need of obstetrical or
other medical and nursing care, and which is recognized by the
Department of Health (DOH);

2. A health care professional, who is a doctor of medicine, nurse, midwife,
dentist, or other health care professional or practitioner duly licensed to
practice in the Philippines;

3. A health maintenance organization, which is an entity that provides,
offers, or arranges for coverage of designated health services for its plan
holders or members for a fixed prepaid premium;

4. A community-based health care organization, which is an association of
indigenous members of the community organized for the purpose of
improving the health status of that community through preventive,
promotive and curative health services;

5. Pharmacies or drug outlets, laboratory and diagnostic clinics, and
manufacturers, distributors and suppliers of pharmaceuticals, medical
equipment and supplies; or

6. Any other entity or organization recognized and contracted by the
Philippine Health Insurance Corporation;

v



m.

n.

Pp.

q.

.. Inpatient services refer to healt

Health insurance identification (ID) card refers to the official identification card
issued by the Philippine Health Insurance Corporation to members and
dependents to serve as the instrument for proper identification, eligibility
verification, and utilization recording;

Health intervention refers to all health services aimed at promotional,
preventive, and curative care, diagnosis, rehabilitation and palliation towards
achievement of optimal health outcomes. It can be population-based or
individual-based, depending on the recipient. It can be primary, or secondary, or
tertiary level health care. It can be delivered face-to-face or remotely, through
telecommunications and information technology. It includes drugs, vaccine,
clinical equipment and devices, medical and surgical procedure, preventive and
promotive health services and traditional medicine;

. Health system refers to all organizations, people and actions the primary intent

of which is to promote, restore or maintain health;

Health technology assessment refers to a multidisciplinary process which uses a
systematic evaluation of properties, effects, and impacts of health technology to
evaluate the health, social, economic, organizational and ethical implications of
the use of new and existing health technologies;

Indigent refers to a Filipino citizen whose income falls below the poverty
threshold as defined by the National Economic and Development Authority
(NEDA) or one 10 cannot afford, in a sustained manner, to provide for
themselves the minimum basic needs of food, health, education, housing, or
other amenities of life;

Individual-based interventions refer to those health services that can be
definitively traced back to a singular person such as medicines, vaccines,
outpatient visit and inpatient admission;

interventions delivered requiring admission or
an overnight stay in a health facility;

Member refers to any person who either belongs to the contributory group or
noncontributory group and whose premium contributions have been regularly
paid to the National Health Insurance Program;

Migrant workers refer to documented or undocumented Filipinos who are
engaged in a remunerated activity in another country of which they are not
citizens;

. Negative list refers to an explicit list of diseases, services, technologies, or

interventions to be excluded for coverage under the National Health Insurance
Program;

. Outpatient services refer to health interventions delivered without requiring

admission or overnight stay in the health facility;

Philippine National Formulary refers to the essential drugs list of the Philippines
which is prepared by the National Drug Committee of the DOH in consultation
with experts and specialists from organized professional medical societies,
medical academe and the pharmaceutical industry, and which is updated every
year;



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u. Population-based interventions refer to those health services that cannot be
specifically traced back to a singular person or beneficiary such as water and
sanitation, information and education campaigns;

v. Positive list refers to an explicit list of diseases, services, technologies, or
interventions to be covered by the National Health Insurance Program;

w. Portability refers to the enablement of a member to avail of the benefits of the
National Health Insurance Program in an area outside the jurisdiction of the

member's Local Health Security Office;

x. Primary care refers to first-contact, accessible, continued, comprehensive and
coordinated care that is accessible at the time of need, focuses on the long-term
health of a person rather than the short duration of the disease, includes a range
of services appropriate to the common problems in the respective population,
and acts to coordinate with other specialists that the patient may need;

Primary health care refers to essential health care based on_ practical,
scientifically-sound and_socially-acceptable methods and technology made
universally-accessible to individuals and families in the community through their
full participation and at an affordable cost, which they can maintain at every
stage of their development in the exercise of their power of self-determination
and their abilities to pursue self-reliance;

z. Province-wide and city-wide Investment Plan for Health refers to the multi-
sectoral and medium-term plan to be developed by the province and highly
urbanized and independent cities to detail the health objectives for a given term
as well as the necessary investments to achieve these objectives.

ai

B

.. Self-employed refers to a person who is both employee and employer at the same
time;

bb. Service delivery network refers to a group of public and private health facilities
encompassing primary care to higher level facilities within a province-wide or
city-wide health system;

ce, Telemedicine refers to the remote diagnosis and treatment of patients by means
of telecommunications technology;

dd. Universal health coverage refers to the right of every Filipino to healthy living
conditions and to receive the necessary promotive, preventive, curative,
rehabilitative and palliative health services that are of sufficient quality and
effectivity without suffering financial hardship when obtaining these services;

CHAPTER IL
UNIVERSAL HEALTH COVERAGE

SECTION 4. Entitlements under Universal Health Coverage Scheme.

a. Range of Services and Providers. All Filipinos shall be entitled to preventive,
promotive, curative, rehabilitative, palliative services, which may be delivered to
populations or individuals, by institutional or individual professional and
community health care providers, personally in the community or within health
facilities, or remotely through telemedicine.

b. Gatekeeping. All Filipinos shall have a primary care provider, the initial point of
contact that will authorize access to financed higher levels of care, except in
severe or emergency cases.



SECTION 5. Defining Entitlements. (Service Coverage)

a. Population-level entitlements shall be defined as a positive list.

b. Individual-level entitlements shall be defined as a negative list and shall not be
limited by the type of condition, but the types of intervention per condition. The
types of interventions that will be funded shall be determined through a fair and
transparent priority-setting process or health technology assessment.

SECTION 6. Accessing Entitlements. (Population Coverage)

a. All Filipinos shall be automatically included in the National Health Insurance
Program as Non-Contributory members, and thus entitled to all benefits
prescribed therein. Formal employment in public or private sector, and/or
willingness to pay higher premium, shall enable shift in status to Contributory
member.

b. Membership into the program shall enable Filipinos, regardless of socio-
economic status, to obtain individual-level services from their health care
provider of choice.

SECTION 7. Financing Entitlements. (Financial Coverage)

a. The National Health Insurance Program, shall be the primary safety net for
health-related financial risk, followed by supplementary public and private health
insurance, and/or out-of-pocket payment.

b. Co-insurance and co-payments shall be determined based on the accommodation
type for inpatient and based on provider type for outpatient.

CHAPTER IIL
GOVERNANCE & ACCOUNTABILITY

SECTION 8. The respective roles and functions of agencies involved in the
implementation of Universal Health Coverage are as follows:

a. Department of Health — The DOH shall be the overall steward for health care
and constantly work to achieve better national health outcomes for Filipinos, to
ensure an equitable health financing, and to maintain a responsive health care
system. It shall:

1. Set national objectives and targets for the health sector;

2. Set standards for the following:

i, per capita health allocation for population-level services per
province;
programs for health promotion and population-based health
services to be implemented by local government and other health
partners;

. development projects that require health impact assessment and
public health management plans;

iv. safety, efficacy, quality, affordability, and cost-effectiveness of
health products and services and assure public of these products
and services;

v. equitable distribution of professionals and facilities and devise
mechanisms to attain such distribution within province-wide
service delivery networks;

i, management of health administrative, direct and research data

vii. ethics of public health practice;



viii. complementarity of private health insurance and health
maintenance organization plans to the National Health Insurance
Program

3. Provide technical assistance to the local governments using the province-
wide investment plan for health as a guide;

4. Negotiate and enter into Framework Agreements for health commodities,
devices and equipment that may be applicable for health care providers
nationwide;

5. Maintain an open data portal and proactively upload data sets to promote
participation and research;

6. Manage the national health workforce pool;

7. Lead and manage a health policy and systems research consortia to ensure
adequate internal and sectoral analytic capacity evidence-informed
policymaking;

8. Initiate and sustain policies and programs with other stakeholders to
address social determinants of health, such as: occupational health and
safety, urban planning, active design, transport safety, air and water
pollution control and prevention, food desertification, crime prevention
and control;

9. Perform other functions as may be necessary to ensure the health and
well-being of Filipinos.

b. ‘The Philippine Health Insurance Corporation shall serve as the national
purchaser of individual-based health services to ensure equity in health
financing. It shall:

1. Create and maintain robust records of members (using civil registry data),
health care providers, networks of health care providers, and health
insurers;

2. Provide unique ID number to every Filipino;

3. Develop basic and supplementary health insurance benefits, and maintain
separate funds for such;

4. Develop the appropriate provider payment mechanism, reimbursement
rates and thresholds, and incentives for health care providers;

5. Develop and implement guidelines on selective/preferential contracting of
public or private health care provider networks;

6. Monitor performance, provide incentives or implement sanctions, on
contracted provider networks;

7. Recognize accreditation by third parties as basis for incentives;

8. Perform other functions as may be necessary to realize the objectives of
this Act;

c. The Provincial Governments, in addition, shall:

1. Exercise technical and administrative oversight over municipalities and
cities within the geographic bounds of the province in implementing

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. Establish, operate and organize health facil

public health programs and setting-up the province-wide service delivery
networks;

. Develop and update the province-wide investment plan for health which

shall be the basis for any technical assistance from the national
government.

- Create epidemiology and surveillance units that will regularly report and

submit data to the DOH.

. Submit epidemiology and notifiable disease data and other relevant health

informatio!

. Allocate financing for population-level interventions;

. Establish a Special Health Fund;

ties following service delivery
network-based standards

. Purchase medicines in line with the Philippine National Formulary and

Drug Price Reference Index, and framework agreements

|. Augment health workforce positions funded by the national government

. Perform other functions as may be necessary to ensure the health and

well-being their constituents;

d. The City Governments of Highly Urbanized and Independent Cities, in
addition, shall:

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Set up and exercise technical supervision over the city-wide service

delivery networks;

- Consolidate the city-wide investment plan for health which shall be the

basis for any technical assistance from the national government;

. Create epidemiology and surveillance units that will regularly report and

submit data to the DOH;

. Submit epidemiology and notifiable disease data and other relevant health

information;

. Allocate financing for population-level interventions;

. Establish, operate and organize health facilities following service delivery

network-based standards

. Purchase medicines in line with the Philippine National Formulary and

Drug Price Reference Index, and framework agreements

. Augment health workforce positions funded by the national government

. Perform other functions as may be necessary to ensure the health and

well-being of their constituents;

e. The Department of Social Welfare and Development shall support and

assist

the implementation of this act. The DSWD shall set-up mechanisms to

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finance non-direct costs borne out of accessing medical services by non-
contributory including transportation, accommodation, or halfway house and
meals.

f. Other Government Agencies shall assist and support the Department of
Health, PhilHealth, and Local Government Units in the implementation of this
Act pursuant to their existing mandates. They are likewise mandated to share
relevant health related data and information with the DOH and PhilHealth and
implement agency-specific components of health programs in coordination with
the relevant agencies.

g. The Private Health Insurance & Health Maintenance Organizations
shall:
1. Provide supplementary and/or complementary health coverage regardless
of age and health status at reasonable costs;
2. Develop standard supplementary and/or complementary plans that
support PhilHealth’s benefit coverage and coinsurance schedule

b. ‘The Health Care Providers, whether publie or private, shall
Participate in delivery of population-based and individual based health
services;

2. Routinely submit data in electronic format covering clinical, prescription,
cost accounting and price to facilitate inspection through the Philippine
Health Information Exchange;

3. Submit financial statement clearly delineating income and expenditures
for various types of accommodation, on an annual basis;

4. Secure confidentiality and privacy of patients, subject to applicable laws.

i, The Development Partners including academic institutions, non-
governmental organizations, civil society organizations, cause-
oriented groups shall assist the DOH, PhilHealth, and LGUs and the
implementation of this Act by supporting research initiatives and providing
technical assistance at the national and local level to ensure evidence-based
policy making, program implementation, and monitoring and evaluation, among
others.

j. Community Based Organizations shall support the implementation of this

Act by assisting health workers in mobilizing and empowering communities and
families to access health care services and health insurance and to participate in
community health diagnosis and health promotion activities. They shall likewi:
assist in improving family health care and in the integration of the community
into the health service delivery network.

SECTION 9. Ethics in Public Health Policy and Practice. ‘The implementation of
Universal Health Coverage scheme shall be strengthened by commitment of all
stakeholders to abide by ethical principles in public health practice.

a. Conflict of Interest declaration and management shall be routine in all policy-
determining activities, and applicable to all appointed decision-makers and
policymakers.

b. All manufacturers of drugs, medical devices, biological and medical supplies
registered by the FDA shall collect and track all financial relationships with
physicians/healthcare providers and report these to the DOH, which shall then
make this list publicly available.



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c. A public health ethics committee shall be constituted as an advisory body to the
Secretary of Health.

d. A clinical ethies committee shall be constituted as an advisory body to the
Professional Regulations Commission. All registered Professional Societies shall
also be mandated to constitute an ethics committee.

SECTION 10. Enabling Evidence-Informed Sectoral Planning
a. Access to Data. All health and nutrition-related administrative and survey data
generated using public funds shall be considered public goods, therefore cannot
be withheld from the public, except if (1) covered by the inventory of exceptions
under applicable laws, and (2) release of information requires excessive cost to
generate in which case those who request the data may be required to pay for the
cost of obtaining it.

b. Information Systems. Regulatory and financing tools shall be utilized to catalyze
the phased adoption of healthcare providers of information systems, including
but not limited to: hospital management and information systems, enterprise
resource planning, human resource information systems, electronic medical
records, and electronic prescription.

¢. Surveillance Systems. Mechanisms allow systematic and timely collection,
analysis, interpretation, and dissemination of outcome-specific data for use in the
planning, implementation, and evaluation of public health practice as well as in
the immediate response to emerging health threats shall be put in place
nationwide.

SECTION 11. Monitoring and Evaluation.
a. The DOH, NEDA and PSA shall develop a monitoring and evaluation framework
to validate the accomplishments of the provisions of this act.

b. ‘The Philippine Statistical Agency (PSA) shall conduct the relevant modules of the
Family Income and Expenditures Survey/the National Health Expenditure
Survey annually during the first (10) years of the implementation of this Act, in
order to track progress and thereafter follow its regular schedule.

c. The Food and Nutrition Research Institute shall regularly conduct the National
Nutrition Survey to track progress on other health and other nutrition targets.

d. The DOH and other relevant government agencies shall institutionalize the
conduct of additional surveys, studies, and researchers to track the country’s
performance in achieving the objectives of this Act and the attainment of health
specific goals.

e. A mechanism for the regular reporting of the findings of these studies shall be
established.

CHAPTER IV
LOCAL HEALTH SYSTEMS AND SERVICE DELIVERY NETWORKS

SECTION 12. Province-Wide and City-Wide Health System. The public-sector health
system shall be composed of province-wide health systems, which integrates existing
municipal and component city health systems, and the city-wide health system in highh
urbanized and independent cities. The Provincial Government shall exercise
administrative and technical supervision over the province-wide health system and the

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City Government will exercise over the city-wide health systems in highly urbanized and
independent cities. Where applicable, province-wide and city-wide health systems may
enter into interlocal cooperation arrangements between other provinces and other cities.

SECTION 13. Network-based Care Provision. Population and. individual-based
services shall be delivered by contracted networks consisting of purely public or mix of
public and private entities. Province-wide health systems and city-wide health systems
may organize as many service delivery networks depending on the population of the
province, flow of patients, availability of transportation, among others. Health services
must be made available in geographically depressed and isolated areas.

SECTION 14. Minimum Service Capacity of the Service Delivery Networks. - Service
delivery networks in the province-wide and city-wide health system must have the
following minimum service capacity.

a. Health stations at the barangay level: There shall be at least one health station
supervised by at least a midwife supported by a team of volunteer community
health workers in every barangay. The health station shall provide basic services
including but not limited to health education, counselling, health maintenance
check-ups, immunization, among others. Community health workers shall serve
as primary health care providers and community organizers tasked with
mobilizing and empowering communities and families to access health care
services and health insurance and to participate in health promotion and
prevention activities in the community. Community health workers shall likewise
assist in the collection of relevant health related information in the community.

b. Primary out-patient facility in the cluster of barangays - There shall be at least
one primary care facility with the capacity to provide basis out-patient health
services, including diagnostic services, staffed by an appropriate number of
physicians and health workers in a cluster of barangays within the municipality
or component These health units shall exercise technical supervision over
the health stations in implementing preventive health programs and population-
based services.

c. Primary care facility - ‘There shall be at least one primary care facility with
service capacity of both an infirmary and a birthing facility that is staffed by
physicians and supported by a full complement of trained health workers in each
municipality and component city. These health units shall exercise technical
supervision over the health stations and primary out-patient facilities in
implementing preventive health programs and population-based services.

d. Level 1 General Hospitals ~There shall be at least one Level 1 general hospital
based on the definition DOH AO 2012-0012 serving a cluster of cities and
municipalities. The level 1 general hospital shall exercise technical supervision
over primary rural health units and health centers of the cities and municipalities
under its jurisdiction.

e. Level 2 General Hospitals — There shall be at least one Level 2 hospital DOH AO
2012-0012 in the service delivery network which shall exercise technical
supervision over level 2 facilities under its jurisdiction.

f. Other facilities for specialized care — Health facilities, both out-patient and in-
patient for specialized needs like diagnosis and treatment of diseases conditions
including but not limited dialysis clinics, substance abuse treatment and
rehabilitation centers, oncologic treatment centers, physical medicine and
rehabilitation clinics shall be organizing depending on the specific needs of the
service networks, city-wide, and province-wide health system.

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g. Transportation services — Service delivery networks shall have the capacity to
transport patients within the network or to a higher-level facility.

SECTION 15. Level 3 Hospitals — There shall be at least one level 3 hospital in each
region which shall serve as end referral health facilities and training centers for both the
delivery of population based and individual health services in the province-wide and
city-wide health systems.

SECTION 16. Private Health Care Providers in the Service Delivery Network —
Provincial governments and city governments of highly urbanized and independent
cities can engage health care providers in the private sector to be a part of the service
delivery network at any level, provided that the no balance billing policy will apply for
services rendered to indigent patients and non-contributory members.

SECTION 17. Integration of Population and Individual Based Service in the Service
Delivery Network — Delivery of population and individual based services shall be
integrated at all levels of the service delivery network. Strategies for preventive and
health promotive shall be integrated in curative modalities.

SECTION 18. Assignment of Filipino families to Health Care Providers. All Filipinos
shall be assigned to a primary care provider attached to a service delivery network. The
path that each Filipino family will take to receive care from different levels of health care
providers depending on their health needs shall be pre-defined and shall be made
known to these families through the community health workers.

SECTION 19. Care Provision in times of Emergencies and Disaster - In case of
emergencies and disasters, the national government shall enlist the assistance of
province-wide and city-wide health systems to render services.

CHAPTER IV
FINANCING

SECTION 20, Delineation of Financing Roles. In order to ensure non-duplication in
the use of funds for Universal Health Coverage, the roles of various payers are as
follow:

a. Operating Expenses
1. Operating expenses for population-based services shall be financed by
National and Local government units as budget subsidies.

2. Operating expenses for full cost of care, including professional services, in
most basic type of accommodation individual-based services shall be
financed through the National Health Insurance Program, as prospective
payments.

3. Additional operating expenses incurred for higher types of
accommodation, which accounts for amenities, shall be financed by
supplementary insurance or household out-of-pocket payments.

b. Salaries of Health Workers in the Public Sector
1. Minimum complement of health workers per service delivery network
shall be financed by the National Government.

2. Additional staff required to improve services of the service delivery
network shall be financed through the income of the network, or
additional budget of the Local Government Unit.

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c. Capital Investments in the Public Sector
1. Capital investment funds shall be primarily financed by National and
Local government units as budget subsidies, and secondarily through the
income of the network.

SECTION 21. Pooling into the National Purchaser. The NHIP shall pool all funds
intended to support provision of individual-based services, specifically operating
expenses. This includes, but not limited to, maintenance and operating expenses
subsidies of public hospitals, budget for commodities and drugs, medical assistance
programs of DOH, PCSO, PAGCOR, DSWD and other government agencies.

SECTION 22. Income Retention of Health Facilities in the Public Sector. — To ensure
that all government hospitals and health facilities have full authority to utilize their
income and enhance their capacity to expand and to improve the quality of their
services, all government hospitals are hereby authorized to retain and utilize one
hundred percent (100%) of their income, which includes reimbursements from the
Program, for capital outlays for the purpose of equipment and infrastructure projects
including construction, improvement, and/or renovation of the hospital facility; other
expenses for maintenance and operation of the facility; assistance to indigents;
personnel services; implementation of population based services and health promotion
programs within the network and/ or within the facility's catchment area; and other
purposes to be determined by the DOH without remitting the same to the Bureau of
‘Treasury.

The retained income shall be deposited in an authorized government depositary bank
recommended by the DOH, the DBM, and the Department of Finance.

Further, all public hospitals shall comply with the standard cost accounting method of
the DOH and accordingly account for their finances and expenditures with separate
financial reports for No Balance Billing and non-No Balance Billing accommodation.

SECTION 23. Use of Reimbursements by Public Providers. All payments for
professional services rendered by salaried public providers shall be pooled and
distributed among health professionals.

SECTION 24. Supplementary Health Insurance. The NHIP, Private Health Insurance
and Health Maintenance Organization shall develop standard plans that complement
the Philippine Health Insurance Corporation's benefit schedule.

CHAPTER V
REGULATION

SECTION 25. Safety and Efficacy
a. The DOH, through the FDA shall assure safety and efficacy of products through
product registration,

b, The DOH shall assure safety of health facilities through faci

licensing.

c. The DOH and DENR, shall assure safety of communities exposed to development
projects that meet the risk threshold through mandatory health impact
assessment and public health management plans.


Secwrsauaeune

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SECTION 26. Quality
a. PhilHealth shall set standards for quality management system in hospitals
through the Benchbook.

b. The DOH shall set standards to reduce variation in clinical practice through a
clinical practice guideline clearinghouse.

c. The DOH and PhilHealth shall recognize third party accreditation mechanisms to
assess quality of goods, facilities, services and professionals.

SECTION 27. Cost Effectiveness and Affordability
a. The DOH shall determine cost-effectiveness & affordability of entitlements
through health technology assessment process.
1. In the interim, the DOH shall institute an HTA system and build sectoral
capacity for HTA.

2. Within 5 years, an independent HTA body shall be created.

3. The HTA process shall inform the cost-effective and affordable price at
which the government should procure medical devices, commodities,
drugs and vaccines, including the expansion of drugs and vaccines listed in
the Philippine National Formulary, national vaccination and screening
programs, and purchase/reimburse NHIP benefits.

4. The HTA process shall be recommendatory to the to the DOH and
PhilHealth.

5. DOH and PhilHealth shall not approve any benefit expansion without
HTA process.

6. A Price Reference Index shall inform the ceiling price at which national
and local government procures drugs and devices, or purchases services.

b. The DOH shall develop standards for accommodation types and corresponding
co-payment percentages.

c. The DOH shall require health facilities to operate with fixed percentage of Type X
accommodation (or no balance billing/zero co-payment)
1. All existing level 3 government hospitals - not less than ninety percent
(90%) of their bed capacity

2. All existing level 1 and level government hospitals and all new government
hospitals created after the effectivity of this Act - 100% of their bed
capacity

3. All specialty hospitals - not less than eighty percent (80%) of their bed
capacity

4. Private hospitals - not less than 10% of their bed capacity
SECTION 28. Equity. The DOH shall assure equitable access to services and equitable
distribution of drug outlets, health facilities and health workers.
a. Drug outlets and health facilities shall only be given license to build in identified
areas with service gaps.
b. All health professional graduates from state universities and colleges or

recipients of government funded scholarships shall be required to render at most

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2 years of service, with compensation and under supervision, in identified areas
with service gaps.

c. All medical graduates shall be required to render 2 years of service, with
compensation, in identified areas with service gaps after taking the physician
licensure as a pre-requisite for entering medical residency or specialization
training, whether local or international.

d. The DOH shall have oversight functions over all training programs for medical
specialists, including determination of slots and distribution annually.

e, All health plantilla items shall be centralized to a National Health Workforce
Pool.

f, The government shall expand scholarship grants for _ health-related
undergraduate and graduate programs, based on the needed cadre of health
professionals per provincial service delivery network.

g. Residency training programs for specialization in government training
institutions shall prioritize applicants from GIDA areas or applicants who will
commit to serve underserved areas. Government training institutions shall set up
deployment programs to ensure that its graduates are these underserved areas.

A National Health Workforce Pool shall be created to centralize all health plantilla
items and enable redistribution based on need in each Service Delivery Network.

4. All health workers in the Pool shall be guaranteed adequate compensation
and benefits commensurate to their fundamental role in society.

2. Plantilla items shall be adjusted consistent with the burden of disease and
responsiveness to contextual geographic needs especially of underserved
areas.

h. ‘The DOH, the CHED, and the DBM shall develop and plan the expansion of local
health-related degree programs and regulate the number of enrollees in each
degree program based on health needs of the population. For programs not
available locally, the DOH and the CHED shall develop a systematic capacity
development program that shall enable the full implementation of this Act.

SECTION 29. Generics prescribing -- Sec. 6 of RA 6675 is hereby amended to read
as all medical, dental and veterinary practitioners, including private practitioners, shall
write prescriptions using the international nonproprietary name (INN) or generic name
ONLY. No brand names shall be allowed in any part of the prescription.

SECTION 30. Availability of Generics -— All drug outlets shall be required at all
times to carry the generic equivalent of all drugs in the Primary Care Formulary. Drug
outlets shall be required to provide customers with a list of therapeutic equivalent and
their corresponding prices when fulfilling prescriptions and/or in any transaction.

SECTION 31. Access to Price Information. — ll health care providers and
facilities shall be required to display and make readily accessible pertinent, relevant, and
up-to-date information regarding the prices of medical services and all goods and
services being offered by such health care provider.



CHAPTER VI
PHILIPPINE HEALTH INSURANCE CORPORATION

SECTION 32. Membership. PhilHealth shall categorize members into two (2) types.
‘These include those who have capacity to pay premiums, to be called Contributory
Members, and those whose premiums will be subsidized by the government, to be called
the Non-contributory Members.

a. Contributory members include public and private workers and all other workers
rendering services, such as job order contractors; project-based contractors and
the like; owners of micto enterprises; owners of small, medium and large
enterprises; household help; family drivers; migrant workers;  self-earning
individuals; professional practitioners; Filipinos with dual citizenship;
naturalized Filipino citizens; and citizens of other countries working or residing
in the Philippines; and

b. Noncontributory members include indigents as identified by the DSWD, senior
citizens, and all others not included in the contributory group, or those covered
by special laws.

SECTION 32. Premium for Contributory Members. PhilHealth shall implement
the 5% premium rate for all contributory members, without of any income cut-off
and/or ceiling.

SECTION Premium for Non-contributory Members. — The national
government shall fully subsidize the contributions of the non-contributory members.
Such subsidy to the Program shall be included annually in the General Appropriations
Act, among other sources.

SECTION 34. Collections. PhilHealth shall enlist the assistance of the Bureau of
Internal Revenue, the Government Service Insurance System, and/or the Social Security
System in collecting premium from the contributory members and the private sector
employers; and the Department of Budget and Management for government sector
employers.

SECTION 35. Immediate Entitlement — After a premium contribution is made, no
minimum period or lag time shall be required to activate entitlement to Program
benefits. In the case of contributory members, failure to pay premiums shall not prevent
the enjoyment of Program benefits, but employers and self-employed members shall be
required to pay all missed contributions with at least three percent (3%) penalty,
compounded monthly.

SECTION 36. Fund Management. PhilHealth shall manage the following funds as a
single pool:
© Contribution from Program members;

© Other appropriations earmarked by the national government such as the
health assistance funds of the Philippine Charity Sweepstakes Office
(PCSO) and the Philippine Amusement and Gaming Corporation
(PAGCOR), medical assistance programs of DOH, and local governments
purposely for the implementation of the Program;

Administrative fines

Subsequent appropriations provided for under this Act;
Donations and grants-in-aid; and

All accruals thereof.



SECTION 37. Administrative Cost. No more than five percent (59%) of the sum total
of the premium contributions and investment earnings generated during the preceding
year shall be allocated as administrative cost of the Corporation.

SECTION 38. Portability. PhilHealth shall develop and enforce mechanisms to
assure that benefits are accessible in countries, especially with Overseas Filipino
Workers.

SECTION 39. Investment Reserve Fund. PhilHealth shall invest the Investment
Reserve Fund in any or all of the following; otherwise, the provisions in RA 10606 on
the Reserve Fund shall govern: In debt securities and corporate bonds issuances that are
rated triple “A” or double “A” by authorized accredited domestic rating agencies:

a. In interest-bearing bonds, securities or other evidence of indebtedness of the
Government of the Philippines, or in bonds, securities, promissory notes and
other evidence of indebtedness to which full faith and credit and unconditional
guarantee of the Republic of the Philippines is pledged;

b. In debt securities and corporate bonds issuances that are rated triple “A” or
double “A” by authorized accredited domestic rating agencies: Provided, That the
issuing or assuming entity or its predecessor shall not have defaulted in the
payment of interest on any of its securities and that during each of any three (3)
including the last two (2) of the five (5) fiscal years next preceding the date
of acquisition by the Philippine Health Insurance Corporation of such bonds,
securities or other evidence of indebtedness, the net earnings of the issuing or
assuming institution available for its recurring expenses, such as amortization of
debt discount and rentals for leased properties, including interest on funded and
unfunded debt, shall have been not less than one and one quarter (1 4) times the
total of the recurring expenses for such year: Provided, further, ‘That such
investment shall not exceed fifteen percent (15%) of the Investment Reserve
Fund;

c. In interest-bearing deposits and loans to or securities in any domestic bank doing
business in the Philippines: Provided, That in the case of such deposits, this
shall not exceed at any time the unimpaired capital and surplus or total private
deposits of the depository bank, whichever is smaller: Provided, further, That the
bank shall have been designated as a depository for this purpose by the Monetary
Board of the Bangko Sentral ng Pilipinas;

d. In preferred stocks of any solvent corporation or institution created or existing
under the laws of the Philippines and listed in the stock exchange: Provided, That
such securities are rated triple “A” or double “A” by authorized accredited
domestic rating agencies: Provided, That the issuing, assuming, or guaranteeing
entity or its predecessor has paid regular dividends upon its preferred or
guaranteed stocks for a period of at least three (3) years immediately preceding
the date of investment in such preferred or guaranteed stocks: Provided, further,
‘That if the stocks are guaranteed, the amount of stocks so guaranteed is not in
excess of fifty percent (50%) of the amount of the preferred stocks as the case
may be of the issuing corporation: Provided, furthermore, That if the
corporation or institution has not paid dividends upon its preferred stocks, the
corporation or institution has sufficient retained earnings to declare dividends for
at least two (2) years on such preferred stocks;

e. In common stocks of any solvent corporation or institution created or existing
under the laws of the Philippines listed in the stock exchange with proven track
record of profitability and payment of dividends over the last three (3) years; and



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f.

In bonds, securities, promissory notes or other evidence of indebtedness of
accredited and financially sound medical institutions exclusively to finance the
construction, improvement and maintenance of hospitals and other medical
facilities: Provided, That such securities and instruments are backed up by the
guarantee of the Republic of the Philippines or the issuing medical institution
and the issued securities and bonds are both rated triple “A” by authorized
accredited domestic rating agencies: Provided, further, That said investments
shall not exceed ten percent (10%) of the total Investment Reserve Fund.

SECTION 40. Tax Exemption. PhilHealth shall be exempt from the payment of
corporate tax as provided in Section 27(c) of the National Internal Revenue Code of
1997, as amended.

All grants, bequests, endowments, donations and contributions made to the

Corporation to be used actually, directly and exclusively by the Corporation shall
be exempt from donor's tax and the same shall be allowed as allowable deduction
from the gross income of the donor for purposes of computing the taxable income
of the donor in accordance with the provisions of the National Internal Revenue
Code of 1997, as amended.

SECTION 41. Benefit Expansion. All new benefits under the National Health
Insurance Program shall have undergone health technology assessment.

SECTION 42. Provider Payment & Contracting, PhilHealth shall use the provider
payment mechanism that balances access, quality, financial protection with cost
containment.

a. PhilHealth shall publish fair reimbursement rates that are guided by accurate
disease groupings, periodic costing and consultation, and a_ stronger
surveillance and monitoring system to monitor compliance by all health care
providers.

b. PhilHealth shall pay providers prospectively: Provided that health care
providers submit real-time encoded claims data, consistent with the Data
Privacy Act of 2012. Pending this shift, all health care facilities are expected to
submit electronic or fully encoded claims with all necessary accompanying
data within fifteen (15) days upon the discharge of a patient and PhilHealth
shall reimburse within thirty (30) days from filing thereof: Provided, that all
required documents are submitted completely.

¢. PhilHealth shall set annual reimbursement thresholds for facilities based on
facility type, facility level, geographic location, expected case mix, and other
cost drivers, as may be determined by the Philippine Health Insurance
Corporation and linked with key performance indicators.

d. PhilHealth shall preferentially contract networks instead of individual health
facilities.

e. PhilHealth shall develop differential payment schemes to incentivize
efficiency, quality and access.

SECTION 43. Penal Provisions. A violation by the following persons shall suffer
the corresponding penalties as herein provided:

a. Contracted Health Care Provider — Any contracted health care provider
who commits an unethical act, abuses the authority vested upon him or
her, or perform a fraudulent act as defined in Section 4 of this Act shall be
punished by a fine of two hundred thousand pesos (P200,000.00), or
suspension of contract for three (3) months, or both, at the discretion of
the Corporation. If the health care provider is a juridical person, its
officers and employees or other representatives found to be responsible,

7



who acted negligently or with intent, or have directly or indirectly caused
the commission of the violation, shall be liable. Recidivists may no longer
be contracted as participants of the Program.

b. Member - Any member who commits any violation of this Act or
knowingly and deliberately cooperates or agrees, whether explicitly or
implicitly, to the commission of a violation by a contracted health care
provider or employer as defined in this section, including the filing of a
fraudulent claim for benefits or entitlement under this Act, shall be
punished by a fine of fifty thousand pesos (P50,000.00) for each count or
suspension from availment of the benefits of the Program for not less than
three (3) months but not more than six (6) months, or both, at the
discretion of the Corporation.

ca apo

Failure or Refusal to Register, Deduct or Remit the Contributions
Any employer who deliberately or through inexcusable negligence,
fails or refuses to register employees, regardless of their
employment status, accurately and timely deduct contributions
from the employee's compensation or to accurately and timely
remit the same to the Corporation shall be punished with a fine of
fifty thousand pesos (P50,000.00) for every violation per affected
employee, or imprisonment of not less than six (6) months but not
more than one (1) year, or both such fine and imprisonment, at the
discretion of the court.

Any employer or any officer authorized to collect contributions
under this Act who, after collecting or deducting the monthly
contributions from the employee’s compensation, fails or refuses
for whatever reason to accurately and timely remit the
contributions to the Corporation within thirty (30) days from due
date is presumed prima facie, to have misappropriated the same
and is obligated to hold the same in trust for and in behalf of the
employees and the Corporation, and is immediately obligated to
return or remit the amount. If the employer is a juridical person, its
officers and employees or ‘other representatives found to be
responsible, whether they acted negligently or with intent, or have
directly or indirectly caused the commission of the violation, shall
be liable.

ii, Unlawful Deductions — Any employer or officer who shall deduct
directly or indirectly from the compensation of the covered
employees or otherwise recover from them the employer's own
contribution on behalf of such employees shall be punished with a
fine of five thousand pesos (P5,000.00) multiplied by the total
number of affected employees or imprisonment of not less than six
(6) months but not more than one (1) year, or both such fine and
imprisonment, at the discretion of the court. If the unlawful
deduction is committed by an association, partnership, corporation
or any other institution, its managing directors or partners or
president or general manager, or other persons responsible for the
commission of the act shall be liable for the penalties provided for
in this Act.

iii. Misappropriation of Funds by Employees of the Corporation —
Any employee who, without prior authority or contrary to the
provisions of this Act or its implementing rules and regulations,
wrongfully receives or keeps funds or property payable or

18



deliverable to the Corporation, and who shall appropriate and apply
such fund or property for their own personal use, or shall willingly
or negligently consent either expressly or implicitly to the
misappropriation of funds or property without objecting to the
same and promptly reporting the matter to proper authority, shall
be liable for misappropriation of funds under this Act and shall be
punished with a fine equivalent to triple the amount
misappropriated per count and suspension for three (3) months
without pay.

CHAPTER VIL
APPROPRIATIONS

SECTION 44. Appropriations. — ‘The funds needed to implement the provisions of this
Act shall be included in the General Appropriations Act. Incremental revenues from
excise tax on alcohol and tobacco as provided for in RA 10351 shall be earmarked for the
implementation of this Act.

CHAPTER VU
MISCELLANEOUS PROVISIONS

SECTION 45. Requisites for Issuance or Renewal of License or Permits. —
Notwithstanding any law to the contrary, all government agencies issuing professional
or business licenses or permits including LGUs, the DOH, Professional Regulation
Commission, Land Transportation Office, Land Transportation Franchising and
Regulatory Board, Securities and Exchange Commission, Philippine Overseas
Employment Administration, Integrated Bar of the Philippines, Philippine Economic
Zone Authority, Bureau of Immigration, Department of Trade and Industry, and the
Maritime Industry Authority shall require all applicants to submit a certificate or proof
of payment of premium contributions to the Corporation, prior to the issuance or
renewal of such licenses or permits.

SECTION 46. Oversight Provision. — ‘There is hereby created a Joint Congressional
Oversight Committee to conduct a regular review of the implementation of this Act
which shall entail a systematic evaluation of the performance, impact or
accomplishments of this Act and the various agencies involved in realizing universal
health coverage, particularly with respect to their roles and functions.

a. The Joint Congressional Oversight Committee shall be composed of five (5)
members from the Senate and five (5) members from the House of
Representatives, to be appointed by the Senate President and the Speaker of the
House of Representatives, respectively.

b. The Joint Congressional Oversight Committee shall be jointly chaired by the
Chairpersons of the Senate Committee on Health and Demography and the
House of Representatives Committee on Health.

SECTION 47. Implementing Rules and Regulations. — Within sixty (60) days from the
approval of this Act, the Secretary of Health, the Secretary of Social Welfare and
Development and the Corporation, in consultation and coordination with appropriate
government agencies, civil society organizations, nongovernment organizations,
representatives from the private sector, and other stakeholders, shall promulgate the
necessary implementing rules and regulations for the effective implementation of this
Act.

SECTION 48. Interpretation. — Any doubt in the interpretation of any provision of
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this Act shall be liberally interpreted in a manner mindful of the rights and interests of
every Filipino to qualit essible and affordable health care.

SECTION 49. Separability Clause. — If any part or provision of this Act is held
invalid or unconstitutional, the remaining parts or provisions not affected shall remain
in full force and effect.

SECTION 50. Repealing Clause. — Republic Act No. 7875, as amended by Republic
Act Nos. 9241 and 10606, is hereby repealed. All other laws, decrees, executive orders
and rules and regulations contrary to or inconsistent with the provisions of this Act are
hereby repealed or modified accordingly.

SECTION 51. Government Guarantee. - The Government of the Philippines
guarantees the financial viability of the Program.

SECTION 52. Effectivity. — This Act shall take effect fifteen (15) days after its
publication in the Official Gazette or in any newspaper of general circulation.

Approved,

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