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THIRTEENTH CONGRESS OF THE REPUBLIC 
First Regular Session 
OF THE PHILIPPINES 
Introduced by SENATOR EDGARDO J. ANGARA 
EXPLANATORY NOTE 
Government hospitals, while receiving subsidy from the National Government, 
cannot utilize their income for the maintenance and other operating expenses (MOOE) 
and capital outlay of the hospital. Said income is required by law to be remitted to the 
national treasury. 
This practice however, has a debilitating effect on the hospital's capability for 
expansion and improvement of its services. To address this counter-productive 
approach, this proposed measure seeks to give more meaning to the autonomy of 
government hospitals in the area of physical and operational development by granting 
them the authority to utilize their income for their maintenance and other operating 
expenses (MOOE) and capital outlay expenditures. 
Admittedly, as per special provision No. 6 of the General Appropriations Act 
(GAA), Department of Health (DOH) hospitals are already authorized to retain their 
income since 2003. The DOH has again proposed the inclusion of said provision in the 
2005 GAA. 
Through this proposal, DOH hospitals and all other government hospitals for 
that matter shall now be granted authority to retain their income permanently, without 
need of proposing its inclusion in the GAA on a yearly basis. 
It is hoped that in making our government hospitals more financially 
independent, effective and efficient,delivery of quality health services to the people will 
be consistently ensured. 
Approval of this bill, therefore, is earnestly sought. 
EDGARDO pk 
. ANGARA 


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THIRTEENTH CON'GRESS OF THE 
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REPUBLIC OF THE PHILIPPINES 
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First Regular Session 
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SENATE 
s. B. NO. 
189% 
Introduced by SEN. EDGARDO J. ANGARA 
AN ACT AUTHORIZING GOVERNMENT HOSPITALS TO UTILIZE 
ALL ITS INCOME FOR HOSPITAL OPERATIONS PARTICULARLY MAINTENANCE 
AND OTHER OPERATING EXPENSES (MOOE) AND CAPITAL OUTLAY. 
Be it enacted by the Senate and the House of Representatives of the Philippines 
in Congress Assembled: 
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SECTION 1. Government hospitals are hereby authorize to utilize their income 
from pharmacy, fees from in-house services and facilities, including but not limited to 
laboratory, radiology, operating room and nursery facilities and income derived from 
non-patient related services such as parking fees, interview fees and tour fees, for the 
maintenance and other operating expenditures including capital outlay, especially for 
the acquisition of hospital machineries and equipment. 
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Mayor. 
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SECTION. 2.. Expenditures under this Act shall be subject to existing auditing 
rules and regulations. In addition, the retained hospitals shall submit quarterly report of 
income and expenditures to the Department of Health (DOH), while devolved hospitals 
shall submit the same to the office of the .Provincial Governor or the City/Municipal 
SECTION. 3. The DOH, in coordination with the agencies concerned shall 
formulate the necessary rules and regulations for the effective implementation of this 
Act within sixty (60) days from its approval. 


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SECTION. 4. If any provision of this Act or an application thereof to any person or 
circumstance is held invalid, the other provisions of this Act, and the application of such 
provision to other persons or circumstances, shall not be affected thereby. If any provision 
of’this Act is held invalid, any other provision not so affected shall continue to be valid 
and effective. 
SECTION. 5. 
All existing laws, orders, rules and regulations or parts thereof 
deemed inconsistent with the provisions of this Act are hereby repealed or modified 
accordingly. 
SECTION 6. This Act shall take effect fifteen (15) days following the date of its 
publication in the Official Gazette or in at least two (2) newspapers of general 
ci rculatio t i .  
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Approved, 
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