SOLICITOR General Menardo Guevarra defended the transfer of “excess” funds of the Philippine Health Insurance Corporation (PhilHealth) to the National Treasury, amounting to P89.9 billion, saying there is nothing unconstitutional or illegal about the move.
This as Guevarra asked the Supreme Court in a manifestation dated September 4 to junk for lack of merit the petition seeking to stop the Marcos administration from transferring the funds to the national treasury.
The OSG answer was in response to an SC en banc ruling late last month directing Malacañang and Congress to answer the petition seeking to stop the transfer of excess PhilHealth funds to the national treasury to fund other government projects.
To recall, opposition Sen. Aquilino Pimentel III, former Finance undersecretary Cielo Magno, the Philippine Medical Association and several others asked the High Court in a petition to declare as unconstitutional Department of Finance (DOF) Circular No. 003-204 and Section 1(d) of XLIII of the 2024 General Appropriations Act.
The assailed DOF circular directs the transfer of unused subsidies from government-owned and-controlled corporations (GOCCs), specifically PhilHealth, to the national treasury to bolster the government’s unprogrammed appropriations.
Pimentel’s group argued that the said DOF circular is “unconstitutional” and “illegal.”
“By taking out the alleged ‘unused funds’ which are pooled funds from members contribution, whether direct or indirect, Congress, DOF and PhilHealth, deprive the Filipino people access to quality and affordable health care goods and services,” the petitioners said.
“The fund transfer goes against our goal to have a comprehensive universal health insurance program for all Filipinos,” they added.
The petitioners said there is a pressing need for the High Court’s intervention as P20 billion of the P89.9 billion in PhilHealth funds has been transferred to the national treasury.
They also asked the High Court to issue a temporary restraining order and/or writ of preliminary injunction to prevent the transfer of funds and preserve and or restore the status of prior to the transfer of the P20 billion to the national treasury last May.
‘NOT A RIDER’
However, Guevarra argued that contrary to the claim of the petitioners, Section 1(d) of XLIII of the GAA 2024 “is not a rider” and does not violate Section 25 (2) and Section 26(1) of Article VI of the Constitution.
Section 25 (2) states: “No provision or enactment shall be embraced in the general appropriations bill unless it relates specifically to some particular appropriation therein. Any such provision of enactment shall be limited in its operation to the appropriation to which it relates.”
Section 26 (1), on the other hand, provides that “Every bill passed by the Congress shall embrace only one subject which shall be expressed in the title thereof.”
With this, Guevarra said the subject provision of the 2024 GAA does not amend or violate provisions of Republic Act 11223 or the Universal Health Care Act (UHCA) and RA 10351 and RA 11346 or the Sin Tax Reform Laws as claimed by Pimentel’s group in their plea before the SC.
Guevarra insisted that Section 1(d) of the 2024 GAA is actually “a valid act of appropriation” and does not violate the people’s right to health.
As for DOF Circular No. 003-2024, the solicitor general said there was nothing wrong or invalid about it as it was validly issued in accordance with Section 1 (d) of the 2024 GAA.
“The circular does not violate Section 29 (3) Article VI of the Constitution which states that all money collected on any tax levied for a special purpose shall be treated as a special fund and paid out for such purpose only,” Guevarra said, adding that it also does not violate the cash budgeting system provision of the 2023 GAA.
“The raising of funds for government expenses is a legislative prerogative and the concept of an unprogrammed appropriation funded through excess revenue/funds is not a novel concept, as petitioners suggest,” he further said.
He also stressed that in Belgica v. Executive Secretary, the High Court explained that the concept of unprogrammed appropriations, which necessarily includes the special provisions, is valid.
“Hence, the assailed 2024 GAA provision pertaining to the fund sources under the unprogrammed appropriations is an essential element that complies with the requirement under Section 25(2), Article VI of the Constitution and well within the power of Congress to appropriate,” Guevarra added.
HIERARCHY OF COURTS
As to the claim of Pimentel’s group that the transfer of PhilHealth excess funds to national treasury violates the people’s right to health, Guevarra said the SC is not the proper venue to litigate the accuracy of such claim.
He said such petition should have been filed before the regional trial court; otherwise, the petitioners are violating the rule on the hierarchy of courts.
“All told, there is no violation of the people’s right to health in this case. The transfer of funds has not been clearly shown to have impaired, let alone violated the mandates of the UHCA,” Guevarra added.
Lastly, Guevarra said PhilHealth’s income was more than enough to cover the payment of benefit claims and operating expenses, and that the idle PhilHealth funds were “in excess of the funds needed for its maintenance and operations, including the payment for any outstanding claims for fiscal year 2023.”
To highlight the strong fiscal position of PhilHealth, Guevarra said as of March 31 this year, the former has a reserve fund of some P488 billion while its average net income over the past three years stood at over P100 billion.
