SC ORDERS RETURN OF P60B TO PHILHEALTH

THE Supreme Court (SC) has unanimously ordered the government to return P60 billion in Philippine Health Insurance Corporation (PhilHealth) funds that were previously transferred to the National Treasury.

The order was penned by Associate Justice Amy Lazaro-Javier.

In a 15-0 decision, the High Court ruled that the transfer was improper and directed that the amount be immediately returned to PhilHealth.

The SC also permanently prohibited the transfer of the remaining ₱29.9 billion fund balance that was supposed to be remitted last November but was stopped by the High Court. 

The High Tribunal declared void the Special Provision under the 2024 General Appropriations Act and a Department of Finance (DOF) circular, deciding that it was “issued and implemented with grave abuse of discretion amounting to lack or excess of jurisdiction.”

The provision authorized the return of the excess reserve funds of government-owned or controlled corporations to the National Treasury to fund unprogrammed appropriations under the 2024 GAA.

According to the SC, the Special Provision (1)d is unconstitutional because it impliedly repeals Section 11 of the Universal Health Care Act (UHCA) and the Sin Tax Laws.

It said reallocating PhilHealth’s supposed “excess reserve funds” through Special Provision 1(d) and DOF Circular No. 003-2024 makes compliance with Section 11 impossible as they undermine the very nature of PhilHealth funds as pooled resources for social health insurance, among others.

The SC stressed that Congress cannot repeal Section 11 through the General Appropriations Act.

The SC further found that Special Provision 1(d) contradicts the Sin Tax Laws, which earmark specific percentages of excise taxes on sweetened beverages, alcohol, and tobacco products exclusively for the UHCA.

The SC also ruled that the Finance Secretary cannot, in any capacity, augment any item in the GAA because this power belongs to the President.

During a press conference, Supreme Court spokesperson attorney Camille Sue Mae Ting said the ruling is immediately executory.

Meanwhile, Malacañang said it respected the decision of the Supreme Court on the transfer of P60 billion unused funds of the PhilHealth even as the Office of the Solicitor General will review the decision and decide whether to file an appeal.

Last September 20, 2025, President Ferdinand Marcos Jr. already restored PhilHealth’s P60 billion excess funds, in recognition of the agency’s improved performance and increased benefits for members.

“We respect the decision of the Supreme Court. The Office of the Solicitor General will review the ruling and decide on the appropriate course of action to take including the filing of a motion for reconsideration,” Presidential Communications Office Secretary Dave Gomez said in a statement Friday.

With regards to the funds transfer, Gomez said the Executive simply acted in accordance with the congressional mandate under the General Appropriations Act (GAA) 2024.

“We note that majority of the members of the High Tribunal declared as unconstitutional a provision of the General Appropriations Act (GAA) 2024 passed by Congress. We note that the Executive simply complied with the congressional mandate under the said law,” the PCO chief said.

Gomez said President Marcos took proactive steps last September 25 to restore the PhilHealth’s excess fund worth P60 billion in “recognition of the agency’s stronger performance, increased absorptive capacity and expanded benefits in line with the government’s goal of delivering universal healthcare for all Filipinos.”

“The House of Representatives incorporated the restoration in the General Appropriations bill and the Senate likewise upheld the directive in its committee report,” Gomez added.