Renegotiating the social contract: Achieving universal health care in the Philippines

Background: The decentralization of health services in 1992 made local government units primarily responsible for delivering health services, with health expenditure trends reflecting this relationship. Out of pocket sources however continued to be the dominant source of health financing after 17 years of aiming for universal coverage through social health insurance. Methods: We used data from the General Appropriations Act from 2007 to 2012 and the National Health Accounts from 2005 to 2007 to track budget growth and spending, respectively. Results: We observed that local spending consistently exceeded national investments in health with an average of five percent from 2005 to 2007. However, since 2007 the national health budget has increased by more than 400 percent from $200 million to $930 million in 2012. Meanwhile, LGU health budgets have largely remained the constant. Starting in 2011, national government has also covered the $ 255,000 in premiums for 5.3 million poor Filipinos with local spending of roughly $ 100,000 in premium counterparts for the same period. Furthermore, investments in health facilities upgrading have also transferred some $300,000 in grants to local governments. Out of pocket spending however continues to account for half of total spending in health. Conclusions: Despite being decentralized, the national government is increasingly taking a bigger role in financing health care. This increasing trend of national government spending can be expected to continue as implementation of the universal health care agenda scales up in the next four years.