Philippines - WHO: Tax text to increase budget for health

This was the proposal of the World Health Organization (WHO) as another source of funds for the government to be able to increase the budget for health care.

WHO country representative Dr. Soe Nyunt-un said yesterday it’s about time the government “mobilize resources from non-traditional sources” so that it can invest more in universal healthcare (UHC) insurance coverage.

“I have not seen any country taxing SMS (short messaging system). This idea has been floated by some politicians in the Philippines. We are texting too much (so we can raise good amount from SMS),” he said during the 2nd PHAP-Journalism for Nation Building Foundation Health Reporting Series seminar organized by the Pharmaceutical and Healthcare Association of the Philippines.

Aside from SMS, the government could also mobilize levies on currency transaction, unhealthy food, and tourism to raise budget for UHC.

“But of course the priority is the taxes from tobacco and alcohol,” said Soe, adding that by doing this, the number of non-communicable illnesses like cancer, chronic obstructive pulmonary and cardio-vascular diseases will also go down.

WHO is proposing that sin taxes on tobacco and alcohol products be modified to a uniform system from the current multi-tiered system.

In 2006, tobacco companies generated P26.8 billion, representing 4.1 percent of the taxes collected then by the Bureau of Internal Revenue.

But based on the 2005-2006 Tobacco and Poverty Study by the WHO, University of the Philippines and Department of Health (DOH), the government had spent P276 billion for illnesses caused by cigarettes then.

Soe said a simplified sin tax system should be in place firmly by next year or the country might be sidetracked anew in implementing UHC coverage.

“Health reforms flow from changes in political process, or by ongoing socio-economic development taking place globally,” he said.

According to him, social health insurance system is already in place in the Philippines but the “out-of-pocket payment” of patients is still high at 51 percent.

“If the government is not willing to spend money, forget about reforms. UHC does not mean cheap quality at cheap price for the poorest. It should ensure equity of quality healthcare for all,” Soe said.

Meanwhile, the WHO also cautioned the government on the privatization of health care, saying this will not be beneficial to poor Filipinos.

“I don’t agree that we have to privatize health care. The moment you privatize your hospitals, they will (act) like private hospitals and private hospitals are profit-oriented. They will go to the rich segment of the population,” he said.

But Soe clarified that the private sector’s support is vital but the local and national governments are primarily responsible for the country’s healthcare system.

He added the Philippines has a lot of private hospitals and they “are already the big beneficiaries” of current social health insurance programs.

“That is the reason why a lot of people say that ‘the poor is subsidizing the rich.’ The government is paying for the poor but they don’t access the service. Only the rich are using the service (of private hospitals),” he said.

He also said that private hospitals are already the ones benefiting from medical tourism.

“The investment in health is low. The Philippines has health insurance mechanism in place but financial protection is still low with high out-of-pocket (payment by patients) of 51 percent,” he added.

But Soe said WHO agrees “with managerial reforms to improve the efficiency of running public hospitals.”

“We have to remove the image that public hospitals are poor quality service hospitals. Public hospitals can be improved to the same standard quality of care of private hospitals,” he added.

Sheila Crisostomo (The Philippine Star)

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