So even non-contributing
people, so long as they declare themselves as poor, automatically become
PhilHealth members and get free or subsidized hospitalization. Also, all senior
citizens, poor or non-poor, get PhilHealth membership card.
The big question is if PhilHealth can absorb all that
money. Being a PhilHealth member does not automatically mean there is
PhilHealth spending on the person. In my case, I have been a Medicare, then PhilHealth
member for 3 decades now, I have never been hospitalized all this time, so PhilHealth has never spent anything on me yet. Well, my daughter got food poisoning while we were on vacation in Iloilo about two years ago, she was hospitalized, I got some PhilHealth subsidy for the hospital bill.
One ugly feature of this law is the earmarking of revenues for UHC. The DOH, PhilHealth, health
NGOs, and consultants, etc. -- are jumping with joy that there are more money
from sin tax. Since this money comes from more smokers and
drinkers in the country, or the number of consumers of these "sin"
products remain the same, indirectly there is a problem here, a moral hazards problem.
A better option should have been for PHealth to reduce
the monthly and annual contribution of paying members, so that the payment gap
between them and those who contribute zero and yet are also members, declines.
I have argued before that earmarking is wrong. In this
case, many people in the health sector are jumping with joy that there are more tax money from the pockets of more smokers and more alcohol drinkers in the country. If people are concerned with better health, they should be happy if the number of smokers and alcohol drinkers have declined, one indicator of which is that sin tax
revenues are declining.
Without earmarking, the bulk of the extra sin tax revenues should have been used to retire some
public debt. After all, we will be paying P399 B (yes, almost P400 B) for
interest payment alone, and this year 2015 alone. That's how big the public debt is.
Lower debt means savings in interest payment, and such savings can be used for
the health sector, but at a lesser amount than P43 B in 2014.
This way, there is reason for the health sector to be happy -- smaller public debt, lower interest payment, more savings for the
government for all sectors, and more money for the health sector in particular. It is
an indirect way to get additional funding without being parochial and being happy that there are more money from the pockets of more smokers and drinkers in the country.
I supported the hike in sin tax. I support a hike in various consumption taxes including VAT, excise tax, property tax, in exchange for drastic reduction in income tax, personal and corporate. Towards the eventual abolition of income tax.
What I did
not support was earmarking for healthcare. It creates sectoral parochialism in
government. For instance, if PAGCOR will be privatized (about P200 B or higher) expect that only the
education sector aside from huge separation pay of employees, will benefit,
nothing on health or housing, agriculture, or reducing the public debt. If NPC hydro and geothermal plants will be privatized soon, expect the energy sector and LGUs to benefit, nothing
will go to health, agri, infra, etc.
That people are asking until now, "where is the money?" or "how was it spent?" is one proof that earmarking
for healthcare creates more questions, more suspicions, and disappointment.
See also:
Tobacco Tax 6: On Cigarette Smuggling, February 27, 2012.
Tobacco Tax 7: DOH on NCDs and Tax Hike, March 04, 2012
Tobacco Tax 8: Ban Smoking, or Raise its Tax?, March 12, 2012
Fat-Free Econ 27: Sin Tax and Nannyism, October 22, 2012
Tobacco Tax 9: Why Earmarking Legislation is Wrong, January 14, 2014
