All posts by: Anton Miguel Ragos

(Part 2): Petilla Health Model

Access to health services
Complementary to the national government’s initiative to expand the insurance coverage, the province also adopted a mechanism to further increase Philhealth enrolment in its locality. To target individually-paying members (whose challenge is to induce voluntarily enrolment, and regular and on-time payment of premiums), the province regularly promoted the services and benefits of Philhealth and disseminated reminders about relevant payment information via SMS.
Expansion of enrolment among the poor is also given importance. While the adoption of the National Household Targeting System (NHTS) database aided the national government in identifying poor families to be enrolled under the Sponsored Program, it does not guarantee inclusion of every poor household. And even if a poor Filipino is enrolled as sponsored, the use of Philhealth benefit (or of the facility, to begin with) is not guaranteed either.

The development of a system called the Philhealth Link program aided the province in addressing this problem. Designed to enable membership verification within the facility (in the case for example, when sponsored patients are unaware of their Philhealth enrolment), the program also becomes a useful tool for enrollment expansion.

Under the program, a facility personnel coordinates with a Philhealth employee who then validates the membership by matching the name, age, and/or residence of the patient, thus allowing for verification even in the absence of Philhealth ID. (To incentivize proper and efficient matching, the province compensates the Philhealth personnel-in-charge based on the number of cases successfully matched).

This mechanism allowed the facility to identify and include dependents, as well as poor patients not sponsored by the government since they are yet to be included in the NHTS database. Identified dependents and poor patients (as verified by a DSWD officer installed within the facility) are subsequently included in the list of sponsored members, thus ensuring the grant of Philhealth benefits to poor patients who choose to use the services in the facility.

Using the radio broadcast, billboard installation, and SMS, the province also promoted its health facilities— particularly the free services available to the poor—to further induce better availment. Using the funds received by the facilities from Philhealth, the province even provided monetary “rewards” for every service used by the patient; not only as a form of incentive but also to address the constraints entailed from lack of transportation money.

Lessons from the model
Critical to the success of the Petilla Health Model is the incorporation of an effective incentive mechanism to drive each player to behave in a manner that resulted in mutually beneficial outcomes for the various stakeholders: higher funds from Philhealth prompted local officials to ascertain the insurance coverage and service availment by the public; higher returns of rendering service in public facilities encouraged retention of doctors in government hospitals; and the ensured access and affordability of services, in addition to the rewards offered, encouraged the public to make use of the health services available.

Yet, despite its commendable outcomes, the Petilla model is not perfect. There are still ample opportunities for its improvement; it is not politically easy to implement, and has yet to cover services at the municipal level. It also may or may not be fully replicable in other areas. But surely, the basic lessons behind the reforms—coordination, information, simplicity of rules, innovative use of resources, and incentives—can be an effective guide for other local governments to follow.

Ragos is a researcher of and a member of the Sin Tax team of Action for Economic Reforms.

Part 1: The Petilla Health Model

Philhealth today continues to face challenges that prevent the effective and efficient implementation of the National Health Insurance Program. As of 2012, only 84% of the population were enrolled in Philhealth , of which, only 6% were able to successfully receive claim reimbursements. Of the few beneficiaries who received the claim payments, only 19% are poor (presumably, as they are enrolled under the Sponsored Program), while the greater majority are employees from either government or the private sector.

As discussed last week, several reforms are being undertaken in Philhealth, including: recent amendments in the National Health Insurance Act to address flaws in the policy governing Philhealth; strengthening of the implementation of the No Balance Billing (NBB); adoption of the Case Rate System; and expansion of Philhealth benefits. Also, the passage of the Sin Tax Law further expands the company’s financial resources by earmarking the bulk of the additional proceeds from alcohol and tobacco taxes to Philhealth.

While these reforms are steps in the right direction, the opportunities for improvements to give public the capacity to maximize Philhealth benefits remain ample. In this endeavor, the role of local government units (LGUs) cannot be overemphasized.

Petilla Health Model
In the past, several LGUs adopted their respective innovations to maximize the use of Philhealth. Of the many notable practices, one worth discussing is the health model applied in Leyte under the leadership of then-governor Jericho Petilla.

Also known as the Petilla Health Model, the innovations in Leyte enabled the province to hurdle several age-old challenges in its local health system by tapping previously underutilized resources from Philhealth. Among others, these included the enhancement of government-owned hospitals, retention of doctors in public health facilities, and increased access to health services (especially among the poor).

Enhancement of health facilities
Access to Philhealth benefits first necessitates access to accredited facilities. This fact was recognized by Leyte’s LGU officials and authorities of Philhealth Region VIII. So to attain accreditation of more facilities, close coordination between the local officials from the provincial government and the regional Philhealth office was established. Together, they identified the needs and addressed the problems that hampered the development of the health facilities in the province.

Philhealth Region VIII aided the facilities to meet the minimum requirement for accreditation. Unnecessary stringency was lessened, and the procedures for accreditation were simplified. The paradigm shifted from facility enhancement as prerequisite to accreditation, into granting the accreditation first to enable the use of Philhealth capitation to afford the enhancement. This not only makes use of untapped Philhealth funds to improve the quality of health facilities but also increases the number of hospitals that will enable members to better access their entitled benefits.

Retention of doctors in public facilities
In a country where the number of health professionals remains inadequate, keeping doctors in public hospital means having to compete against the opportunities that the private sector has to offer. But doing this does not justify that other local basic suffer to finance the doctors’ competitive salaries. So how did the province of Leyte afford the salary increase of public doctors to an average of P180,000 monthly? The key was to use the underutilized funds from Philhealth.

As the number of accredited facilities increased in the province, more patients were able to avail themselves of the benefits from Philhealth. Subsequently, more resources from the company were channelled into government-owned hospitals, and a larger pool of income apportioned to government doctors.

Consequently, doctors were induced to stay in public facilities since working outside government-owned hospitals would result in higher foregone revenues. Better returns of rendering medical services also prompted the doctors to prioritize service provision over other options. Thus, by making service in public facilities an optimal choice for doctors, the availability of service providers expanded in the province.

Ultimately, the mechanism provided the public with better access to health services. (to be continued)

Ragos is a researcher of and a member of the Sin Tax Team of Action for Economic Reforms.