Filipino workers who pay into Philippine Health Insurance Corp. (PhilHealth) while also receiving employer-provided health coverage are contributing to two systems that frequently pay for the same services – and PhilHealth has moved to fix it.
PhilHealth has identified a pattern it describes as double coverage: members continue paying PhilHealth contributions but rely primarily on their employer-provided HMO or private health insurance for care. The result is that PhilHealth’s outpatient benefits go unclaimed while employers fund overlapping coverage across two payers.
PhilHealth acting president and CEO Dr. Beverly Lorraine Ho described the problem directly: “They pay for PhilHealth and private health insurance plans and members pay for both, but they still don’t get probably twice the value. YAKAP and GAMOT benefits go unused, while insurance plans paid for consultations and tests that PhilHealth now already covers.”
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Understanding the overlap starts with knowing what PhilHealth’s YAKAP – Yaman ng Kalusugan Program – actually provides. YAKAP covers medical consultations, 13 laboratory tests, and outpatient services for six cancer screening tests. Its GAMOT component provides covered essential medicines worth up to PHP20,000 per patient per year, subject to the program’s terms and available medicines. Specialized outpatient services including animal bite treatment, maternal care, tuberculosis management, HIV/AIDS management, and mental health services are also covered where applicable, according to GMA Network and PhilHealth.
Those benefits are being duplicated in many employer-sponsored HMO plans – a structural inefficiency the complementation program is designed to remove.
On October 1, 2026, PhilHealth signed a memorandum of understanding with major HMOs and private health insurers to formally coordinate benefits. Under the arrangement, PhilHealth serves as the primary payer for outpatient services within its coverage scope. Private insurers act as secondary payers for costs that exceed PhilHealth’s limits or fall outside primary care – including specialized procedures, branded medications, and hospital room upgrades.
Participating organizations include Asalus Corp. (Intellicare), Avega Managed Care Inc., Cooperative Health Management Federation, Health Plan Philippines Inc., inLife Benefits Insurance Company Inc., Insular Health Care Inc. (iCare), Maxicare Healthcare Corp., the Manufacturers Life Insurance Co. (Phils.), Medicard Philippines Inc., Medicare Plus Inc., Pacific Cross Health Care Inc., PhilhealthCare Inc., and United Coconut Planters Life Assurance Corp., according to GMA Network.
Ho was clear that the program does not require members to stop paying premiums. The aim is to make existing contributions work more efficiently by eliminating duplication between public and private payers: “We want to make sure that the benefits are complementary, meaning we don’t duplicate each other’s benefits, and also that we’re able to give better coverage.”
The downstream consequence for brokers is direct. Christian S. Argos, president and CEO of Maxicare and chairman of the Philippine Association of Health Maintenance Organization Companies, spelled it out: “If we can create outpatient products with PhilHealth as the first payer, then more people can actually buy an HMO product because it will be cheaper.”
That pricing shift matters in a market where healthcare costs are rising at 18.3% in 2025 – among the steepest rates in Asia-Pacific – according to WTW’s 2025 Global Medical Trends Survey. Rising claims costs have been the main driver of HMO pricing pressure, and brokers managing group renewals have had limited room to negotiate.
The HMO sector is expanding despite those pressures. The Insurance Commission (IC) reported the industry posted PHP101.56 billion in total revenues in 2025, up 24.8% year on year, with net income reaching PHP3.99 billion – a 300.4% increase on 2024. Total HMO assets reached PHP87.48 billion in the first quarter of 2025, a 22.67% year-on-year rise.
For brokers managing SME accounts – where HMO affordability has historically restricted uptake – complementation may open coverage options that current pricing has closed off. It also sharpens the advisory obligation: when PhilHealth and HMO coverage operate in defined separate layers, the boundary between them needs to be clearly understood. That is where coverage gaps and claims disputes occur.
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The program sits within a broader financing problem. Out-of-pocket payments accounted for 41.2% of total health expenditure in the Philippines in 2025, according to data cited in Senate budget hearings. PhilHealth’s target is to reduce that to 37% by 2028, raising its share of total health expenditure from around 19% to 30%.
Ho framed the objective plainly: “That is really what we want – to reduce our out-of-pocket expenses, especially given how hard life is these days.”
PhilHealth will spend the next three months working with participating HMOs and private health insurers to align systems and procedures before a pilot launch targeted for 2027, within the framework of Republic Act No. 11223 – the Universal Health Care Act – which mandates integration of public and private health financing.
Group health contracts renew annually. Clients making benefits decisions in 2026 will have questions about how complementation affects their plan design, coverage scope, and cost. The 2027 pilot date and the renewal calendar are on different schedules. That gap is where broker guidance carries the most weight.
