Realizing universal health care through sin taxes

Yellow Pad

 

As May elections draw near, legislators are faced with the daunting task of reflecting upon — and marketing — their legacies. Two candidates of note are Senator Sonny Angara and Senator JV Ejercito, both of whom authored bills instituting universal health care in the Philippines. President Duterte signed Republic Act No. 11223, the Universal Health Care Act, in late February 2019.

Universal health care or UHC aims to transform the Philippine health system. By comprehensively reforming how health is financed and how services are delivered, UHC affirms every Filipino’s right to health and aims to make quality care accessible to all.

The journey to passing UHC legislation has been a long one. The health advocates — spanning the medical community, academics, and activists — know that the fight is far from over. The dream comes with costs. And if legislators want to secure their legacy, much remains to be done to shoulder the costs.

 

SUSTAINABLE FUNDING FOR UHC
Make no mistake about it. UHC stands to become one of the greatest achievements of recent Philippine legislation. Wherever one’s political sympathies lie, it is difficult to deny that UHC represents a victory for Filipinos across the nation, especially the poor and those living in far-flung provinces long deprived of access to even basic services.

In a country where average out-of-pocket expenses constitute more than half of health expenditures, UHC assures free basic services for all Filipinos. Focusing on primary care further shifts costs downward as preventive and promotive take precedence over curative procedures, which are more costly to perform. Where for years, 70% of Filipinos have died without medical attention, UHC revitalizes both health facilities and the health workforce, requiring that every barangay and municipality is organized in service delivery networks with adequate doctors, nurses, midwives, health centers, and the necessary technology for inter-communication and smooth transition of medical records. Amid doubts (to put it lightly) surrounding the Dengvaxia issue, UHC institutes stronger terms for health technology assessment, ensuring rigorous standards for all medicines and procedures that will be introduced into the Philippine health system.

health sin tax

But to realize the dream of UHC, the Department of Health has cited a total cost of Php 257 billion in the first year of implementation. More than the immense costs of setting up a UHC-ready health system, the effects of continued population growth and annual inflation will require consistent funding over the years to come. Thus, lawmakers need a sustainable source of funding that assures lasting support of the health system that works for all Filipinos.

 

TRIED AND TRUE: SIN TAXES THE WAY TO GO
Since their implementation in 2012, taxes on tobacco and alcohol products generated enough revenue to triple the Department of Health’s budget. Smoking prevalence, on the other hand, went down from a third of the population to about a quarter. Sectors with the most reduced smoking were the youth and the poor. Sin taxes have thus consistently led to substantial health financing on top of direct health effects, with such benefits amplified among the most vulnerable populations.

What’s more: Senators JV Ejercito, Win Gatchalian, and Manny Pacquiao have already filed bills for increasing the tobacco tax to Php 90, Php 70, and Php 60 per pack, respectively. With the rates proposed, new revenue from sin taxes is projected by the Department of Finance to reach Php 25.9 billion (Ejercito), Php 33.8 billion (Gatchalian), and Php 30.1 billion (Pacquiao) in the first year alone. That’s a sizeable chunk of the UHC costs well accounted for. This incremental sum is likewise an essential component in the DOH’s own accounting for the costs of UHC.

The research has been done, the funds found substantial, and the legislation ready for discussion. So one must ask: What’s stopping us from taking the necessary steps to make UHC a reality? Perhaps, in the delicate atmosphere of the elections, the politicians do not wish to send the wrong signal to voters — or the tobacco industry?

 

UHC LEGISLATORS: DON’T SETTLE FOR HOLLOW LEGACIES
Yet in refusing to do the heavy lifting needed to realize UHC, the same legislators send their own signals of deficiency. UHC may become a centerpiece of their CVs or official profile pages as a legacy of their senatorial tenure. But they will remain hollow legacies. Empty. That is, if at the end of the day, without the necessary funds, they continue to reap the symbolic benefits of “fathering” UHC, while families around the country suffer from our broken health system. The UHC they father will be stillborn.

At this juncture, however, it is not too late. When the dust clears from the elections, legislators will face a strong test of their commitment to real change, of creating a legacy that will last. Health advocates — as well as every Filipino — will be keeping close watch.

Senators: You’ve signed your name onto the bills. You’ve tacked kalusugan onto your catchy monikers and tarps. You’ve had your photo ops with Filipinos from communities nationwide. You’ve made them promises as numerous and grand as your ambitions of another term. Do more now than make promises. Keep them.

 

Joshua Uyheng is a PhD student in societal computing at Carnegie Mellon University. He was formerly a research associate of Action for Economic Reforms specializing in fiscal and healthcare policy.

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Realizing universal health care through sin taxes

Yellow Pad

 

As May elections draw near, legislators are faced with the daunting task of reflecting upon — and marketing — their legacies. Two candidates of note are Senator Sonny Angara and Senator JV Ejercito, both of whom authored bills instituting universal health care in the Philippines. President Duterte signed Republic Act No. 11223, the Universal Health Care Act, in late February 2019.

Universal health care or UHC aims to transform the Philippine health system. By comprehensively reforming how health is financed and how services are delivered, UHC affirms every Filipino’s right to health and aims to make quality care accessible to all.

The journey to passing UHC legislation has been a long one. The health advocates — spanning the medical community, academics, and activists — know that the fight is far from over. The dream comes with costs. And if legislators want to secure their legacy, much remains to be done to shoulder the costs.

 

SUSTAINABLE FUNDING FOR UHC
Make no mistake about it. UHC stands to become one of the greatest achievements of recent Philippine legislation. Wherever one’s political sympathies lie, it is difficult to deny that UHC represents a victory for Filipinos across the nation, especially the poor and those living in far-flung provinces long deprived of access to even basic services.

In a country where average out-of-pocket expenses constitute more than half of health expenditures, UHC assures free basic services for all Filipinos. Focusing on primary care further shifts costs downward as preventive and promotive take precedence over curative procedures, which are more costly to perform. Where for years, 70% of Filipinos have died without medical attention, UHC revitalizes both health facilities and the health workforce, requiring that every barangay and municipality is organized in service delivery networks with adequate doctors, nurses, midwives, health centers, and the necessary technology for inter-communication and smooth transition of medical records. Amid doubts (to put it lightly) surrounding the Dengvaxia issue, UHC institutes stronger terms for health technology assessment, ensuring rigorous standards for all medicines and procedures that will be introduced into the Philippine health system.

health sin tax

But to realize the dream of UHC, the Department of Health has cited a total cost of Php 257 billion in the first year of implementation. More than the immense costs of setting up a UHC-ready health system, the effects of continued population growth and annual inflation will require consistent funding over the years to come. Thus, lawmakers need a sustainable source of funding that assures lasting support of the health system that works for all Filipinos.

 

TRIED AND TRUE: SIN TAXES THE WAY TO GO
Since their implementation in 2012, taxes on tobacco and alcohol products generated enough revenue to triple the Department of Health’s budget. Smoking prevalence, on the other hand, went down from a third of the population to about a quarter. Sectors with the most reduced smoking were the youth and the poor. Sin taxes have thus consistently led to substantial health financing on top of direct health effects, with such benefits amplified among the most vulnerable populations.

What’s more: Senators JV Ejercito, Win Gatchalian, and Manny Pacquiao have already filed bills for increasing the tobacco tax to Php 90, Php 70, and Php 60 per pack, respectively. With the rates proposed, new revenue from sin taxes is projected by the Department of Finance to reach Php 25.9 billion (Ejercito), Php 33.8 billion (Gatchalian), and Php 30.1 billion (Pacquiao) in the first year alone. That’s a sizeable chunk of the UHC costs well accounted for. This incremental sum is likewise an essential component in the DOH’s own accounting for the costs of UHC.

The research has been done, the funds found substantial, and the legislation ready for discussion. So one must ask: What’s stopping us from taking the necessary steps to make UHC a reality? Perhaps, in the delicate atmosphere of the elections, the politicians do not wish to send the wrong signal to voters — or the tobacco industry?

 

UHC LEGISLATORS: DON’T SETTLE FOR HOLLOW LEGACIES
Yet in refusing to do the heavy lifting needed to realize UHC, the same legislators send their own signals of deficiency. UHC may become a centerpiece of their CVs or official profile pages as a legacy of their senatorial tenure. But they will remain hollow legacies. Empty. That is, if at the end of the day, without the necessary funds, they continue to reap the symbolic benefits of “fathering” UHC, while families around the country suffer from our broken health system. The UHC they father will be stillborn.

At this juncture, however, it is not too late. When the dust clears from the elections, legislators will face a strong test of their commitment to real change, of creating a legacy that will last. Health advocates — as well as every Filipino — will be keeping close watch.

Senators: You’ve signed your name onto the bills. You’ve tacked kalusugan onto your catchy monikers and tarps. You’ve had your photo ops with Filipinos from communities nationwide. You’ve made them promises as numerous and grand as your ambitions of another term. Do more now than make promises. Keep them.

 

Joshua Uyheng is a PhD student in societal computing at Carnegie Mellon University. He was formerly a research associate of Action for Economic Reforms specializing in fiscal and healthcare policy.

Tags:

Comments are closed.
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