Newly appointed Philippine Health Insurance Corp. (PhilHealth) President and CEO Dr. Edwin Mercado on Wednesday pledged to streamline operations and address inefficiencies in the state-run health insurer, emphasizing the need for transparency and improved service delivery.
Mercado, a medical doctor, acknowledged the challenges of his new role and likened PhilHealth to a patient in need of diagnosis and treatment.
“As a physician, I understand the burden our patients face. Many say, ‘Doc, I’ve practically paid for an entire hospital post.’ That’s how much they spend on healthcare,” Mercado said in a press briefing.
His first priority, he said, is to review and refine PhilHealth’s processes to ensure efficiency and eliminate financial leakages.
“One of the key issues we need to fix is wastage. We will standardize financial reporting so that our records are consistent and transparent,” Mercado said, adding that discrepancies in reports have made it difficult to track the agency’s financial health.
To improve claims processing and prevent fraud, Mercado emphasized the need for a long-term solution through digitization.
“We are pushing for digitization because it will help us adjudicate claims efficiently and determine the actual funds needed for benefit distribution,” he said.
Addressing financial concerns, he stressed that one of PhilHealth’s major priorities is actuarial capacity-building to accurately estimate benefit costs against collections.
“We need reliable data to determine the appropriate amount for our reserve fund and how much should go to the benefit fund,” he said, noting that the medical loss ratio—the percentage of premium collections used for benefits—typically accounts for 85%.
When asked about criticisms that PhilHealth prioritizes investments over benefits, Mercado said the agency will comply with Supreme Court rulings on the matter, but assured that funds will be allocated based on data-driven assessments.
He also underscored the need for a more targeted benefits system, focusing not just on the most common diseases but also on those that lead to catastrophic healthcare spending.
“It’s important to look at illnesses that push families into financial ruin, not just those with the highest occurrence,” Mercado said.
PhilHealth’s spending has been under public scrutiny, particularly after reports surfaced about excessive budget allocations for non-essential expenses.
Mercado confirmed that he has begun reviewing the agency’s approved budget and acknowledged that significant cuts have already been made.
Asked whether he plans to reshuffle PhilHealth officials, he said a staff review is ongoing but emphasized a unifying approach.
“We are here to heal, to bridge, and to see what else we can contribute to the expansion of benefits and the improvement of processes,” he said.
Mercado’s appointment comes as PhilHealth faces scrutiny over delayed payments and inefficiencies, with President Ferdinand Marcos Jr. directing the agency to improve its services and expand benefits for Filipinos.