President Ferdinand Marcos Jr. conferring with hospital staff. PhilHealth will be allocated Php68 billion following the cancellation of Php255 billion worth of locally funded flood control projects under the Department of Public Works and Highways’ (DPWH) proposed budget in 2026. | Photo by PCO via Wikimedia Commons
In 2025, the Philippines’ health financing structure shows a widening contrast between public and private sector capacity — prompting growing calls for partial privatization or complete assimilation of indigent patient care into private health systems through public-private partnerships (PPPs) and insurance reforms.
For 2025, the Department of Health (DOH) has a budget of around ₱248 billion, while PhilHealth’s operating and benefit budget stands at ₱284 billion. It translates to a total public health allocation of roughly ₱532 billion, given a population of nearly 115 million, corresponding to about ₱4,625 per capita public health coverage.
By comparison, total health spending per capita (including private expenditures) reached ₱12,751 in 2024 — meaning the government portion covers only roughly 36% of total individual health costs.
Private sector health expenditure accounts for more than half of the Philippines’ total health spending, exceeding ₱615 billion in 2024. Growth projections show private providers expanding 6–7% annually, driven by middle-class demand, medical tourism, and investments in high-end hospital networks. Most private capacity remains concentrated in Metro Manila, CALABARZON, and Central Luzon, leading to inequality in hospital access and service quality between urban and rural regions.
Supporters of healthcare privatization and PPP expansion argue that the current tiered delivery model is inefficient and regressive. The World Health Organization and local reform panels describe the system as “fragmented,” with state hospitals overburdened and underfunded. Advocates, including Health Secretary Teodoro Herbosa, propose using PPPs to integrate private-sector hospitals into the national delivery framework so that indigent patients can receive care in private facilities compensated through government insurance or guarantee mechanisms.
Recent DOH memorandums already require private hospitals to allocate 10% of their beds to indigent patients, with PhilHealth covering billing under zero-balance policies. However, administrative bottlenecks (e.g., delayed reimbursements and the collapse of the Guarantee Letter scheme) illustrate the difficulties of hybrid systems that rely on public funding but private provision.
Analysts suggest that fully assimilating indigent patients into private care networks could:
- Reduce wait times and congestion in DOH-retained hospitals.
- Leverage private-sector efficiency and technology to improve service.
- Stabilize public finances by shifting hospital infrastructure burdens to PPPs.
However, critics warn that privatization without strict price and quality regulation risks deepening inequity, raising healthcare prices, and prioritizing profit over universal access.
In essence, the rationale for partial privatization and DOH–private system integration centers on capital efficiency and service equity — moving from a fragmented, tiered public hospital model toward a universal delivery framework where private clinics and hospitals, subsidized by PhilHealth or PPP contracts, can sustainably treat indigent patients without stratified care tiers.
“A pilot program to enroll indigent patients in private hospitals can build on existing government mechanisms and tested public-private coordination models.”
As of 2025, the Philippines is executing a series of interlinked policy initiatives under the Universal Health Care (UHC) Law to integrate indigent and financially incapacitated patients into private clinics and hospitals. These steps combine regulatory, insurance, and partnership mechanisms to move toward a unified, tierless care model that blends public subsidies with private-sector delivery.
PhilHealth’s No Balance Billing (NBB) policy is the cornerstone of indigent patient integration. It eliminates out-of-pocket expenses for qualified poor patients by ensuring PhilHealth’s set case rates fully cover all medical, diagnostic, and doctor’s fees.
PhilHealth has intensified efforts urging private hospitals to adopt NBB agreements through memoranda of understanding that compensate facilities for treating indigent and sponsored members. Hospitals such as Karmelli Hospital have already dedicated beds for these patients, aligning with the government’s goal of universal access.
Expanded Medical Assistance for Indigent and Financially Incapacitated Patients (MAIFIP)
The Department of Health (DOH) has expanded the MAIFIP program to include private hospital partners, allocating ₱41.16 billion in 2025 to fund patient subsidies.
Consultative meetings brought together 68 private hospitals to coordinate fund disbursement, reporting, and reimbursement systems for indigent patient care. It ensures that poor patients can receive aid directly at private hospitals without the need for guarantee letters or intermediary processing.
DOH Secretary Teodoro Herbosa and AC Health executives emphasize that PPP frameworks are essential for inclusive healthcare expansion. These partnerships create co-managed facilities (such as Makati Life Medical Center) and integrate private expertise into public-access programs. PPPs are geared toward:
- Expanding bed capacity and diagnostic services in underserved regions.
- Embedding indigent patient quotas into hospital accreditation contracts.
- Shifting healthcare delivery from illness response to wellness promotion while maintaining cost efficiency and stable regulation.
Universal Health Care Integration Framework
Under the Universal Health Care Act (RA 11223), all Filipinos, including indigents, are automatically enrolled in PhilHealth, with government subsidies covering premiums. The 2025 implementation phase consolidates local health systems into province-wide and city-wide networks that contract both public and private providers. All facilities must comply with.
- Zero co-payment for ward/basic admissions.
- Regulated co-payment ceilings for private room upgrades.
- Mandatory transparency in service pricing and patient data reporting to the DOH.
Digital Integration and Seamless Care Access
Through the national eGov platform, the MAIFIP and NBB systems are now digitized, enabling hospitals to settle patient bills in-system without paper-based processing. Moreover, pilot PPP hospitals, such as Makati Life, use digital medical eligibility verification, ensuring real-time confirmation of subsidy entitlements for indigent patients before admission.
Together, these reforms represent a strategic pivot from the old “charity ward” approach to a publicly subsidized, privately delivered health care system that aims to guarantee all Filipinos, rich or poor, equal access to modern medical services.
A pilot program to enroll indigent patients in private hospitals can build on existing government mechanisms and tested public-private coordination models. The following design draws from recent Medical Assistance for Indigent and Financially Incapacitated Patients (MAIFIP) collaborations, PhilHealth protocols, and multi-sector consultative processes.
Pilot Program Design: “Private Indigent Access Network” (PIAN)
1. Eligibility and Enrollment
- Target Beneficiaries: Indigent patients registered under the National Household Targeting System (NHTS) by the Department of Social Welfare and Development (DSWD), or otherwise confirmed as low-income by local welfare offices.
- Automatic Enrollment: DSWD provides an updated beneficiary list to selected pilot hospitals, with automatic PhilHealth indigent category enrollment for eligible families and issuance of digital ID cards.
- Onsite Validation: Hospitals have real-time access to the PhilHealth/DSWD database to validate eligibility before admission. An onsite social worker assists with indigency confirmation for walk-in cases.
2. Scope of Services
- Covered Facilities: 5–10 private hospitals per region, selected for high volume and geographic spread, with at least 10% of beds reserved for indigent admissions.
- Package Coverage: All PhilHealth case-rate covered services, diagnostics, emergency care, and basic surgical procedures. PhilHealth fully covers out-of-pocket fees and, if needed, supplements them with MAIFIP funds.
- Patient Experience: Guaranteed “no balance billing” for all eligible admissions; patients are not charged any additional fees.
3. Hospital Partnership Model
- Government-Hospital MOA: Each hospital signs a memorandum of agreement (MOA) outlining reporting, reimbursement timelines, and service obligations.
- Capacity Commitment: Pilot hospitals agree to allocate and report monthly on bed occupancy by indigent patients.
- MAIFIP Integration: Hospitals access a dedicated hospital medical assistance fund for non-PhilHealth-covered services (e.g., certain medicines, supplies).
4. Systems and Monitoring
- Digital Platform: A web-based registration and monitoring system enables real-time eligibility verification, billing, and disbursement.
- Reporting: Hospitals must submit monthly utilization and outcome reports that capture service delivery, reimbursement, and any gaps encountered.
- Program Evaluation: DOH, PhilHealth, and DSWD jointly review quarterly data and conduct beneficiary and partner satisfaction surveys.
5. Patient Support and Advocacy
- Patient Navigators: Assign trained staff or volunteers in pilot hospitals to assist indigent patients from admission to discharge and post-discharge health needs.
- Feedback Mechanism: Establish an anonymous hotline and feedback forms for patients and families to report issues.
6. Stakeholder Engagement and Review
- Consultative Meetings: Ongoing quarterly meetings between DOH, DSWD, PhilHealth, and hospital partners to refine processes and scale up successful elements.[bworldonline]
- Public Awareness: Coordinate information campaigns in pilot catchment areas about the program, rights, and how to access private hospital induction.
This pilot model builds on recent MAIFIP-private hospital consultations to ensure efficient, compassionate, and accountable care for the Philippines’ most vulnerable, laying the foundation for broader nationwide scaling.
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ABOUT THE AUTHOR: Dr. Crispin Fernandez advocates for overseas Filipinos, public health, transformative political change, and patriotic economics. He is also a community organizer, leader, and freelance writer.
