5 Reasons Why PhilHealth’s 3% OFW Premium Contribution is Simply Wrong

The Philippine Health Insurance Corp. or PhilHealth has recently made an announcement that overseas Filipino workers are obliged to pay 3% of their monthly income to finance the Philippines’ health system.

This has generated an uproar among Filipinos working abroad. As the country was under enhanced community quarantine, the order for OFWs to contribute to the health fund starting this year.

Even when the agency has become hounded by anomaly surrounding corruption allegations, it remains keen on imposing the premium hike for OFWs once the coronavirus pandemic is over.

The circular published on April 22 explained the tiered contributions and collection of payment from overseas Filipino members. The blanket coverage not only includes OFWs but also those on holiday or waiting for their overseas work documents, whether they are unregistered or registered with the National Health Insurance Program. This requirement will cause a significant dent in a Filipino worker’s income. For example, domestic workers must pay $124 per year, or $12 per month, for PhilHealth coverage. If your salary is P60,000 or above, you are mandated by law to pay P1,800 per month or P21,600 this year.

Failure to pay promptly so will mean members shall be billed for the unpaid premiums with interests (compounded monthly) and penalties of at least 3% a month for employers, sea-based OFWs, and household workers. On the other hand, self-earning members, professionals, and land-based migrant workers shall incur a maximum interest of 1.5% for every month of a missed payment.

While the intention to provide universal healthcare to Filipinos is a noble objective, the scheme to collect funds to finance the program is wrong on many fronts.

The 3% rate puts higher-earning members with bigger financial obligation

Instead of the flat P2,400 premium members will pay in a year, the new circular imposes a premium that is 3% of gross monthly income. Although it sounds like an equitable move — contribution is based on income capacity similar to higher earning individuals pay higher tax bill — the healthcare system should not be subsidized based on OFWs’ income. Paying exorbitant fees does not guarantee a hospital bed or prompt medical care when they are far away abroad. Such a fee could be better spent on private health insurance in the country these overseas Filipinos are based.

OFW families are often discriminated from receiving government support

During this time of enhanced community quarantine, Filipino citizens who happen to have OFW relatives are sometimes at a disadvantage. They complain that they don’t receive welfare benefits or covered under certain forms of assistance the government is extending to families to compensate for the loss of livelihood or limited mobility. This is under the common assumption that if you have an OFW relative, you are well-off and therefore be placed as lower priority when receiving government handouts. For this to happen AND PhilHealth charging overseas Filipino workers excessively, there is something wrong in the system.

Compounded interest when missing payment is just torture

It’s not unusual to pay a surcharge when you miss paying your electric bill on the due date but to charge compounded interest on unpaid accounts is too much. In many instances, Filipinos abroad want to ensure they and their families are covered by PhilHealth. But they sometimes find it difficult to pay their premium not because they can’t afford, but the payment channels are sometimes hard to find or unavailable. So failure to pay PhilHealth premium for OFWs is not always because they are unwilling to pay. There are those who are unable to pay. To punish the latter is just unfair.

Many OFWs are covered in an employer’s health insurance

One of the many requirements OFWs must have before they are employed abroad is that they must be covered by health and/or hospital insurance in case of accident or death at work. So for PhilHealth to enter the scene and collect the 3% premium based on a hard-earned income appears redundant. It’s understood that paying the premium isn’t just for OFWs, so the previous P2,400 yearly rate to cover family members is much more appropriate.

Timing is wrong and many OFWs are currently on a no work no pay arrangement

Maybe the circular was meant to be announced on the scheduled date, but COVID-19 not only disrupted healthcare systems worldwide, but it also disrupted the livelihood of millions of workers, including our very own OFWs. Many have lost their jobs, and some have been stood down because the host country’s government has suspended operations of many industries to stem the spread of the virus. This means that many Filipino workers abroad currently receive no income, and unable to send funds to families in the Philippines. For PhilHealth to make such an announcement adds insult to injury.

There’s no doubt many OFWs have signed the petition online to put a stop to the newly-mandated PhilHealth premium scheme.

The Philippine healthcare system is currently under immense pressure due to the coronavirus health crisis, and PhilHealth’s funds should help cover medical expenses for both patients and healthcare workers. But this state-owned health agency also had chequered past. We haven’t forgotten its fiscal mismanagement when the agency was ordered to return the P139.473 million worth of allowances and bonuses found to have been illegally granted to its officials and employees.

If the cash-strapped agency has been really desperate to collect funds, it could have been more prudent in its savings for the rainy day. Now, the agency has less credibility to issue the circular when it failed to instill discipline within its ranks.

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