EIGHTEENTH CONGRESS OF THE ) 
REPUBLIC OF THE PHILIPPINES 
) 
First Regular Session 
)
SENATE
S. N 0.83G
of tbr fcfcri'tnrp
'19 
JUL 31 
P2
Introduced by Senator Ralph G. Recto RECE
AN ACT
MODERNIZING 
HEALTHCARE 
AND 
HEALTH 
INFRASTRUCTURE, 
PROVIDING FUNDS FROM THE ANNUAL VALUE-ADDED TAX COLLECTIONS, 
AMENDING FOR THE PURPOSE THE NATIONAL INTERNAL REVENUE CODE 
OF 1997, AS AMENDED
EXPLANATORY NOTE
The Philippines' health profile is typical of a middle developing country. Aside 
from increasing population, deteriorating environment and poor nutrition, one of the 
biggest factors responsible for the weak performance of the health sector is the 
inadequate and ineffective public spending for health.
The passage of Republic Act No. 11223 or the Universal Health Care (UHC) 
Act during the last Congress marks an era of health care system reforms. Among 
others, the UHC law intends to achieve an integrated and comprehensive approach 
to the health system, addressing both its demand and supply sides. It endeavors to 
make medicines and medical supplies as well as quality health care services available 
to all Filipinos at an affordable cost. It also puts premium on the prudent use of 
financial resources on programs and projects that can help prevent, control, and 
cure diseases.
This bill proposes to allocate ten percent (10% ) of the annual Value-Added 
Tax (VAT) collections to augment the pool of funds to support the implementation of 
the UHC law, specifically for the expanded immunization program and the


modernization of facilities and equipment of rural health units, and public hospitals 
run by local government units and the Department of Health.
Additional funding support to expand the immunization program will help 
address the risk of infant mortality, and support our goal to reduce under-five 
mortality rate by 67%.
Rural health units and district hospitals exercise the first line of defense 
against sickness. Thus, this bill allocates VAT dividends to modernize public health 
facilities in areas that need most of the funding support - the fourth to sixth-class 
municipalities.
It also seeks to establish regional specialty hospitals without the use of loans, 
but instead earmark tax collections of government. 
Creation of these additional 
hospitals would unburden the specialty hospitals located in the National Capital 
Region. It would also allow patients who come from the provinces, and those who 
do not have the resources to combat orthopedic, heart, lung, and kidney diseases, 
immediate and more affordable hospital services without the need to travel long 
distance.
In light of the foregoing, immediate passage of this bill is earnestly sought.
//m ksbc


f
'■•IT,
EIGHTEENTH CONGRESS OF THE ) 
REPUBLIC OF THE PHILIPPINES 
) 
First Regular Session 
)
SENATE
S. No. 836
Senate
0? tl'r «i'rretnr?
•19 
JUL 31 
P 2 « 7
cr.
Introduced by Senator Ralph G. Recto
AN ACT
MODERNIZING 
HEALTHCARE 
AND 
HEALTH 
INFRASTRUCTURE, 
PROVIDING FUNDS FROM THE ANNUAL VALUE-ADDED TAX COLLECTIONS, 
AMENDING FOR THE PURPOSE THE NATIONAL INTERNAL REVENUE CODE 
OF 1997, AS AMENDED
Be it enacted by the Senate and House o f Representatives o f the Philippines in 
Congress assembled:
1 
Section 1. A new section, to be numbered two hundred eighty-seven, shall be
2 
added to Chapter II, Title XI of the National Internal Revenue Code, as amended to
3 
read as follows:
4 
"SEC. 287. DISPOSITION OF PROCEEDS OF VALUE-ADDED TAX. -
5 
TEN PERCENT (10% ) OF THE VALUE-ADDED TAX COLLECTED UNDER
6 
TITLE IV 
OF THIS ACT, AS AMENDED, SHALL BE ALLOCATED TO THE
7 
FOLLOWING 
HEALTH 
EXPENDITURES 
IN 
THE 
FOLLOWING
8 
PROPORTIONS:
9 
1. TEN PERCENT (10% ) SHALL BE ALLOCATED FOR THE
10 
EXPANSION OF THE IMMUNIZATION PROGRAM, TO BE
11 
ADMINISTERED 
BY THE 
DEPARTMENT OF 
HEALTH
12 
(DOH);
13 
2. THIRTY PERCENT (30% ) SHALL BE ALLOCATED FOR THE
14 
IMPROVEMENT 
AND 
MODERNIZATION 
OF 
HEALTH
15 
INFRASTRUCTURE 
AND 
MEDICAL 
EQUIPMENT 
OF
16 
RURAL HEALTH UNITS: PROVIDED, THAT PRIORITY
17 
SHALL BE GIVEN TO THOSE LOCATED IN THE FOURTH
18 
TO 
SIXTH-CLASS 
MUNICIPALITIES: 
PROVIDED,


1 
FURTHER, 
THAT 
THE 
ALLOCATION 
SHALL 
BE
2 
ADMINISTERED BY THE DOH IN CONSULTATION WITH
3 
THE LOCAL GOVERNMENT UNITS (LGUs) CONCERNED;
4 
3. TWENTY PERCENT (20% ) SHALL BE ALLOCATED FOR
5 
THE IMPROVEMENT AND MODERNIZATION OF HEALTH
6 
INFRASTRUCTURE 
AND 
MEDICAL 
EQUIPMENT 
OF
7 
DISTRICT 
AND 
PROVINCIAL 
HOSPITALS, 
TO 
BE
8 
ADMINISTERED BY THE DOH IN CONSULTATION WITH
9 
THE LGUs CONCERNED; AND
10 
4. FORTY PERCENT (40% ) SHALL BE ALLOCATED FOR THE
11 
ESTABLISHMENT OF A SPECIALTY DEPARTMENT IN
12 
MEDICAL CENTERS AND REGIONAL HOSPITALS, TO BE
13 
ADMINISTERED BY THE DOH IN CONSULTATION WITH
14 
THE LGUs CONCERNED. FOR PURPOSES OF THIS ACT, A
15 
"SPECIALTY 
DEPARTMENT" 
IS 
DEFINED 
AS 
A
16 
DEPARTMENT IN MEDICAL CENTERS AND REGIONAL
17 
HOSPITALS THAT IS PRIMARILY OR EXCLUSIVELY
18 
ENGAGED IN THE CARE AND TREATMENT OF ONE OF
19 
THE FOLLOWING:
20 
A. PATIENTS WITH A CARDIAC CONDITION;
21 
B. PATIENTS WITH A LUNG CONDITION;
22 
C. PATIENTS WITH A KIDNEY CONDITION;
23 
AND
24 
D. PATIENTS 
WITH 
AN 
ORTHOPEDIC
25 
CONDITION.
26 
Sec. 2. The succeeding Sections of the National Internal Revenue Code, as
27 
amended, are hereby renumbered accordingly.
28 
Sec. 3. Implementing Rules and Regulations (IRR). -  The Department of
29 
Budget and 
Management 
(DBM), 
DOH, 
Department of Interior and 
Local
30 
Government (DILG) and the Bureau of Internal Revenue (BIR) shall within thirty (30)
31 
days after the effectivity of this Act issue the IRR for its effective implementation.


1 
Sec. 4. Repealing Clause. -  All laws, decrees, executive orders, rules and
2 
regulations, or parts thereof which are inconsistent with this Act are hereby
3 
repealed, amended or modified accordingly.
4 
Sec. 5. Effectivity. -  This Act shall take effect fifteen days (15) days following
5 
its publication in at least two (2) newspapers of general circulation or in the Official
6 
Gazette.
Approved,
//m ksbc