Supreme Court orders return of P60B to PhilHealth, bars further fund transfer

MANILA, Philippines – The Supreme Court (SC) unanimously ordered the return of P60 billion to the Philippine Health Insurance Corporation (PhilHealth), ruling that the fund transfer from the state insurer to the national treasury in 2024 was unconstitutional.

The SC, in a ruling penned by Associate Justice Amy Lazaro-Javier, also “permanently prohibited the transfer of the remaining P29.9-billion fund balance,” the High Court announced on Friday, December 5.

Several groups and public health advocates had filed petitions with the SC, seeking to block the order of the Department of Finance (DOF) to transfer P89.9 billion in “excess” PhilHealth funds to the national treasury.

Then-finance secretary Ralph Recto sought to justify the transfer, saying that the DOF’s directive to the state insurer was within the bounds of the law.

Recto said Republic Act No. 11975 or the General Appropriations Act of 2024 introduced a new “special provision” that allows the government to collect excess funds from government-owned and -controlled corporations like PhilHealth.

But petitioners opposing the fund transfer argued that it violates Section 11 of Republic Act No. 11223 or the Universal Health Care Act, which states that PhilHealth’s reserve funds or income cannot be used as a general fund of the national government.

In total, PhilHealth was only able to remit P60 billion out of the P89.9 billion after a temporary restraining order, issued by the SC in October 2024, prevented it from remitting the last tranche.

Ahead of the SC decision, President Ferdinand Marcos Jr. in September ordered the return of the P60 billion to the state insurer. – Rappler.com