Filipinos could see major changes in how healthcare is delivered and paid for over the next two years as the Philippine Health Insurance Corp. (PhilHealth) rolls out reforms aimed at strengthening primary care, expanding targeted benefits, and reshaping how hospitals are reimbursed.
Speaking at a forum on the future of Universal Health Care (UHC) organized by the Private Sector Advisory Council, PhilHealth, and Ayala Healthcare Holdings, PhilHealth President and Chief Executive Officer Edwin Mercado outlined a reform agenda designed to make the country’s health insurance system more efficient, financially sustainable, and patient-centered.
A cornerstone of the plan is strengthening primary care, with patients increasingly linked to designated healthcare providers who will serve as the first point of contact before referrals to specialists and hospitals.
Mercado said the approach mirrors healthcare systems in many developed countries and is intended to improve care coordination while reducing unnecessary healthcare costs.
The shift marks a significant departure from the hospital-centric model that has long characterized Philippine healthcare, placing greater emphasis on prevention, early intervention, and community-based care.
PhilHealth is also taking a more targeted approach to benefit expansion. Rather than raising coverage across all services, the state insurer plans to focus resources on high-risk and high-cost illnesses that place the greatest financial burden on Filipino families.
“We have to be strategic,” Mercado said, emphasizing that broader benefits must be balanced against the long-term sustainability of the national health insurance fund.
Another major reform involves changing how healthcare providers are paid. PhilHealth is preparing to move away from the traditional fee-for-service system, where hospitals are reimbursed for individual procedures and claims, toward global budget and prospective payment models that provide fixed funding for a defined population or package of services.
The new approach is designed to encourage efficiency, improve cost management, and shift incentives toward better health outcomes rather than higher service volumes.
Mercado also highlighted the role of Health Care Provider Networks (HCPNs), which integrate hospitals, clinics, and primary care facilities into coordinated systems of care. By pooling resources and receiving bundled payments, these networks could negotiate lower prices for medicines and services through bulk procurement.
Taken together, the reforms signal PhilHealth’s ambition to evolve from a passive claims processor into a more active purchaser of healthcare, leveraging its financial muscle to drive efficiency, improve quality, and reduce out-of-pocket costs for patients.
Private hospital groups welcomed the direction of the reforms, citing faster claims processing, shorter reimbursement turnaround times, and growing confidence in PhilHealth’s ability to support the long-term success of Universal Health Care.
