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REPUBLIC ACT NO. 7875
February 14, 1995
AN ACT INSTITUTING A NATIONAL HEALTH INSURANCE PROGRAM FOR ALL
FILIPINOS AND ESTABLISHING THE PHILIPPINE HEALTH INSURANCE
CORPORATION FOR THE PURPOSE.
SECTION 1. Short Title - This Act shall be known as the "National
Health Insurance Act of 1995."
Article I. GUIDING PRINCIPLES
SECTION 2. Declaration of Principles and Policies. - Section 11,
Article XIII of the 1987 Constitution of the Republic of the
Philippines declares that the State shall adopt an integrated and
comprehensive approach to health development which shall endeavor to
make essential goods, health and other social services available to
all the people at affordable cost. Priority for the needs of the
underprivileged, sick, elderly, disabled, women, and children shall
be recognized. Likewise, it shall be the policy of the State to
provide free medical care to paupers.
In the pursuit of a National Health Insurance Program, this Act
shall adopt the following guiding principles:
a) Allocation of National Resources for Health - The Program shall
underscore the importance for government to give priority to health
as a strategy for bringing about faster economic development and
improving quality of life.
b) Universality - The Program shall provide all citizens with the
mechanism to gain financial access to health services, in
combination with other government health programs. The National
Health Insurance Program shall give the highest priority to
achieving coverage of the entire population with at least a basic
minimum package of health insurance benefits;
c) Equity - The Program shall provide for uniform basic benefits.
Access to care must be a function of a person's health needs rather
than his ability to pay;
d) Responsiveness - The Program shall adequately meet the needs for
personal health services at various stages of a member's life;
e) Social Solidarity - The Program shall be guided by community
spirit. It must enhance risk sharing among income groups, age
groups, and persons of differing health status, and residing in
different geographic areas;
f) Effectiveness - The Program shall balance economical use of
resources with quality of care;
g) Innovation - The Program shall adapt to changes in medical
technology, health service organizations, health care provider
payment systems, scopes of professional practice, and other trends
in the health sector. It must be cognizant of the appropriate roles
and respective strengths of the public and private sectors in health
care, including people's organizations and community-based health
care organizations;
h) Devolution - The Program shall be implemented in consultation
with local government units (LGUs), subject to the overall policy
directions set by the National Government;
i) Fiduciary Responsibility - The Program shall provide effective
stewardship, funds management, and maintenance of reserves;
j) Informed Choice - The Program shall encourage members to choose
from among accredited health care providers. The Corporation's local
offices shall objectively apprise its members of the full range of
providers involved in the Program and of the services and privileges
to which they are entitled as members. This explanation, which the
members may use as a guide in selecting the appropriate and most
suitable provider, shall be given in clear and simple Filipino and
in the local languages that is comprehensible to the member;
k) Maximum Community Participation - The Program shall build on
existing community initiatives for its organization and human
resource requirements;
l) Compulsory Coverage - All citizens of the Philippines shall be
required to enroll in the National Health Insurance Program in order
to avoid adverse selection and social inequity;
m) Cost Sharing - The Program shall continuously evaluate its cost
sharing schedule to ensure that costs borne by the members are fair
and equitable and that the charges by health care providers are
reasonable;
n) Professional Responsibility of Health Care Providers - The
Program shall assure that all participating health care providers
are responsible and accountable in all their dealings with the
Corporation and its members;
o) Public Health Services - The Government shall be responsible for
providing public health services for all groups such as women,
children, indigenous people, displaced communities and communities
in environmentally endangered areas, while the Program shall focus
on the provision of personal health services. Preventive and promotive public health services are essential for reducing the need
and spending for personal health services;
p) Quality of Services - The Program shall promote the improvement
in the quality of health services provided through the
institutionalization of programs of quality assurance at all levels
of the health service delivery system. The satisfaction of the
community, as well as individual beneficiaries, shall be a
determinant of the quality of service delivery;
q) Cost Containment - The program shall incorporate features of cost
containment in its design and operations and provide a viable means
of helping the people pay for health care services; and
r) Care for the Indigent - The Government shall be responsible for
providing a basic package of needed personal health services to
indigents through premium subsidy, or through direct service
provision until such time that the program is fully implemented.
SECTION 3. General Objectives. - This Act seeks to:
a) provide all citizens of the Philippines with the mechanism to
gain financial access to health services;
b) create the National Health Insurance Program, hereinafter
referred to as the Program, to serve as the means to help the people
pay for health care services;
c) prioritize and accelerate the provision of health services to all
Filipinos, especially that segment of the population who cannot
afford such services; and
d) establish the Philippine Health Insurance Corporation,
hereinafter referred to as the Corporation, that will administer the
Program at central and local levels.
Article II. DEFINITIONS OF TERMS
SECTION 4. Definitions of Terms. - For the purpose of this Act, the
following terms shall be defined as follows:
a) Beneficiary - Any person entitled to health care benefits under
this Act.
b) Benefit Package - Services that the Program offers to its
members.
c) Capitation - A payment mechanism where a fixed rate, whether per
person, family, household, or group, is negotiated with a health
care provider who shall be responsible for delivering or arranging
for the delivery of health services required by the covered person
under the conditions of a health care provider contract.
d) Contribution - The amount paid by or in behalf of a member to the
Program for coverage, based on salaries or wages in the case of
formal sector employees, and on household earnings and assets, in
the case of the self-employed, or on other criteria as may be
defined by the Corporation in accordance with the guiding principles
set forth in Article I of this Act.
e) Coverage - The entitlement of an individual, as a member or as a
dependent, to the benefits of the Program.
f) Dependent - The legal dependents of a member are: 1) the
legitimate spouse who is not a member; 2) the unmarried and
unemployed legitimate, legitimated, illegitimate, acknowledged
children as appearing in the birth certificate; legally adopted or
stepchildren below twenty-one (21) years of age; 3) children who are
twenty-one (21) years old or above but suffering from congenital
disability, either physical or mental, or any disability acquired
that renders them totally dependent on the member for support; 4)
the parents who are sixty (60) years old or above whose monthly
income is below an amount to be determined by the Corporation in
accordance with the guiding principles set forth in Article I of
this Act.
g) Diagnostic Procedure - Any procedure to identify a disease or
condition through analysis and examination.
h) Emergency - An unforeseen combination of circumstances which
calls for immediate action to preserve the life of a person or to
preserve the sight of one or both eyes; the hearing of one or both
ears; or one or two limbs at or above the ankle or wrist.
i) Employee - Any person who performs services for an employer in
which either or both mental and physical efforts are used and who
receives compensation for such services, where there is an
employer-employee relationship.
j) Employer - A natural or juridical person who employs the services
of an employee.
k) Enrollment - The process to be determined by the Corporation in
order to enlist individuals as members or dependents covered by the
Program.
i) Fee for Service - A reasonable and equitable health care payment
system under which physicians and other health care providers
receive a payment that does not exceed their billed charge for each
unit of service provided.
m) Global Budget - An approach to the purchase of medical services
by which health care provider negotiations concerning the costs of
providing a specific package of medical benefits is based solely on
a predetermined and fixed budget.
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