Health Financing

Studying Philippine Healthcare Expenditure

What is Finance?
Traditionally defined as finding a way to pay for something.

Therefore, when we talk about health financing, we talk about finding a way to secure money to pay for the goods and services that will maintain and/or improve our health.

How do we pay for our health bill?

Health financing is the answer to our basic question!

It is important to remember that different countries follow different health financing schemes.

hilippines! private and out"of"pocket #nited $tates of %merica! private and by insurance and managed care &or Health 'aintenance (rgani)ations* #nited +ingdom and ,anada! sociali)ed &government*

Health Financing
Is crucial to a country-s efforts in making healthcare accessible to most, if not all. Thus, an understanding and appreciation of such is mandated in the study of Health .conomics.

Philippine Healthcare Expenditures

The hilippines- total healthcare e/penditure represents all money being spent for all health goods and services 0 both public and private. It has constantly increased over the past ten years.

It was php 12.3 4illion in 53356 about php 78.3 4illion in 53386 then php 552.9 4illion in :;;:. There followed a big <ump to php 51= 4illion in :;;1. This represents an average 52 percent increase in e/penditures per year.

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The >orld Health (rgani)ation &>H(* recommends developing countries to spend about 2 percent of its ?ross @ational roduct &?@ * for healthcare.

%t our best, we spent only 1.99 percent of our ?@ for healthcare in 5338, after this, there was a steady decline until :;;:, when we spent only :.88 percent of our ?@ for healthcare. % rebound to :.3 percent was seen in :;;1.

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,ompared to other countries in %sia, the hilippines is underspending for health.

$outh +orea and @ew Aealand spend above the >H( recommended rate of 2 percent Hong +ong is very near the recommended rate. >hile the hilippines and Thailand are lagging behind, the hilippines had one of the lowest percentage spent for health at about 1.:; percent in :;;5.

About 76 percent of all Philippine health expenditures are being used for personal health. ersonal health goods and services are those goods and services which manifest effects only on the person utili)ing healthcare. $urgeries, hospitali)ation, rehabilitative health, dental services all fall under this.

Public health spending represents about 10 to 12 percent of total health spending. ublic health programs are endeavors which will have effects on many sectors of a population. Immuni)ation, anti" smoking campaign, pollution control, maternal and child health programs all fall under this.

About 12 percent is being spent for other activities These would be training programs, research, medical technology pro<ects, etc.

Pie chart

.ven the Bepartment of Health devotes most of its e/penditures for personal health. This represents all the e/penditures borne by the B(H mostly for patients seeking healthcare services in B(H"retained hospitals. This was more than hp :; 4illion in :;;1.

(n the other hand, as of :;;1 about php 5= 4illion or 19 percent of government health e/penditures were spent for public health programs. % little more than php 5; 4illion or :: percent of government e/penditures were spent for CotherD purposes. 4etween :;;: to :;;1 there was a :7 percent increase in government health spending for health purposes

Governmen !He"# $!E%&en'( )re!*+!U,e!o-! .)n',

YEAR 2002 2003 2002 2003 AMOUNT (in billion pesos)
PERSON AL PUBLIC OTHERS TOTAL

PERCENT SHARE
PERSON AL PUBLIC OTHERS

15.8 20.2 27.7

12.1 16.0 32.4

8.4 10.3 23.0

36.3 46.5 28.2

43.6 43.5

33.2 34.3

23.1 22.2

Source: National Statistical Coordination Board 2003 Report

Health Expenditures By Source Of Funds

'ore than half of about 27 percent of the total health spending in the country is paid for by private sources. These are all health e/penses paid by private individuals, companies and private insurance to hospitals, clinics, and other healthcare facilities mainly for personal health.

The government is the ne/t highest spender for health.

The government has a spending which represents about 12 percent of total health spending in the country. >hile this spending is being used mainly for personal health, a big chuck of such is being used for public health programs. The hilippine social insurance system &'edicare" hilhealth* paid for about 5;.; percent of the country-s health bill in :;;1. This was 55 4illion.