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Increased health funding and political will, key solutions to achieve UHC by 2015

Dr. Ramon P. Paterno of UP Manila highlights the importance of increasing the budget for health to attain Universal Health Care


Acknowledging that health is a basic human right and that there is a need to respond to increasing health inequities in the country, the Aquino administration has committed to achieve Universal Health Care (UHC) by 2015. Population coverage by 2015 will be obligatory and premiums will be subsidized by taxes from the National Government.

Dr. Ramon P. Paterno of UP Manila highlighted this commitment in his health policy paper presentation entitled “How Do We Finance Universal Health Care in the Philippines?” during the UP National Institutes of Health (NIH) Research Forum held last 10 May 2012. The paper examines policy options for financing the achievement of UHC by 2015.


In his paper, Dr. Paterno considered the Philippine Health Insurance Corporation (PhilHealth) as the key to health financing reforms.

“The informal sector is expected to contribute to the premiums of the Individually Paying Program, with partial subsidies from the LGU. The large size of the informal sector, the administrative costs involved in identifying, enrolling and collecting from them will most likely lead to a stagnant population coverage of 80% at most by 2015, with PhilHealth share of Total Health Expenditure at 20% at best,” said Dr. Paterno

Another option to achieve UHC rapidly, according to Dr. Paterno, is for the premiums of the non-professional segment of the informal sector be subsidized by taxes.

“If we want to decrease out-of-pocket expenditure to 20 or 30% of Total Health Expenditure as protection against impoverishment from catastrophic health expenditures, Government share, both national and local, must increase to 50-60% of Total Health Expenditures because PhilHealth share would reach only 20% at best, based on the experience of middle income countries,” explained Dr. Paterno.

Dr. Paterno reported that the costs for UHC in 2015 would range from P615 billion at 5% of projected Gross Domestic Product (GDP). P312 billion would be the minimum amount needed by the public health delivery system.

“With political will, we can raise revenues for UHC.  With the appropriate tax reforms and increased collection efficiency, we can increase tax collection rate from its present 14% of Gross Domestic Product (GDP) to 17% of GDP which we were able to do in 1997;   3% of GDP differential translates to about P300B, enough to fund UHC,” he said.

Dr. Paterno further stressed, “Increasing the budget for health is the first step in achieving UHC. However, it is not sufficient. It is vital to have socio-economic development that will lead to growth for all to lessen health inequities and improve health outcomes.”