Wednesday, October 17, 2012

Privatization: A Tool of Oppression

“The State shall protect and promote the health of the people and instil health consciousness among them.” 1987 Philippine Constitution, Art. II, Sec. 15
This is how explicit the Philippine Constitution is about the government’s responsibility regarding the right to health of the people. The Universal Declaration of Human Rights (UDHR) and other international covenants support this declaration. Article 25, of the 1948 UDHR states,
“Everyone has the right to standard of living adequate for the health and well being of himself and of his family, including food, clothing, housing and medical care.”
Privatization of health facilities and services, the abandonment of state’s responsibility to people’s health and allowing private business to take over which makes health a commodity for profits, is definitely an outright and blatant violation of the people’s right to health.

Privatization is a global phenomenon dictated by the monopoly capitalists as their solution to the crisis of the world capitalist system of overproduction and concentration of surplus capital. The neoliberal policies of globalization specifically privatization, deregulation, liberalization and labor-flexibilization were imposed by the monopoly capitalists on debt-ridden third world countries like the Philippines to provide for their expansion and control of markets where to dispose their goods and invest their surplus capital to stimulate the stagnation of trade and investments.

The monopoly capitalists are aided by their multilateral institutions namely the World Bank, (WB), International Monetary Fund (IMF), the World Trade Organization (WTO), the Asian Development Bank (ADB) also called the International Financial Institutions (IFIs). Through these institutions, the neoliberal policies like privatization have become an integral part of the state policies of many countries both developed and underdeveloped.

The IMF-WB imposed their Structural Adjustment Program (SAP) on heavily indebted third world countries like the Philippines to lessen government spending and allow entry of foreign capital through loans. Thus, export orientation was promoted, imports and foreign investments were liberalized, major economic sectors were deregulated and state-owned enterprises were privatized. All these provide the state involved to accrue funds for payment of their mounting external debts from these institutions and to usher in their surplus products and capital for investments.

Privatization, however, in the context of globalization and capitalists’ crisis is not simply a response to fiscal difficulties and not only to sell off state-owned enterprises. The challenge is to “redefine the role of the government”. Investment of surplus capital must find its way to the extent that globalization has encroached on state institutions and state responsibilities like social services for the people. Privatization has become an issue of sovereignty. The role of the International Financial Institutions (IFIs) – the World Bank (WB) and the International Monetary Fund (IMF) in the privatization process in the Third World countries clearly show how it undermines the sovereignty of these countries. In the Philippines, the bureaucrats and the local capitalists have their own specific roles in the continuing and deepening control of the monopoly capitalists on the economic, political and socio-cultural aspects of the country through their neoliberal policies like privatization.

History of Privatization of Health Care in the Philippines

Privatization as an official government policy in the Philippines gained foothold during Marcos’ time. His cronies incurred foreign loans for their businesses which went bankrupt due to personal interests and corruption. As guarantor, the Philippine government had to bear the losses and the responsibility for the loan payment. Eventually, foreign debts steadily increased with the concomitant payments which the IMF and the WB took advantage of and imposed their Structural Adjustment Program (SAP). To meet the IFIs demand, Marcos issued Presidential Decrees 2029 and 2030 which set the legal framework for privatization of government assets. Republic Act 5260 was enacted authorizing the sale of the Welfareville Property and the National Center for Mental Hospital.

Corazon Aquino was the first to implement privatization. When she assumed presidency, the Philippines had $28B external debt for which she did not agree of debt repudiation raised by some quarters. Instead, she signed Presidential Proclamation no. 50 which provided for the formation of the Committee on Privatization (COP) and Asset Privatization Trust (APT), the implementing arms for sale of government properties. A total of 287 enterprises worth Php 20.3 billion were privatized from 1987 to 1990.

Fidel Ramos, upon assumption as President submitted Letter of Intent (LOI) to the IMF-WB which contained further reduction of government subsidies for public services. Thus, more Government Owned and Controlled Corporations (GOCC’s) were lined up for privatization. His Social Reform Agenda (SRA), the expression of the Structural Adjustment Program (SAP) heightened the trade and industry liberalization and intensified budget cuts for public services to satisfy the lopsided conditionalities of the International Financial Institutions.

Through his program “Health in the Hands of the People”, Ramos approved the Local Government Code, the law which justified the devolution of public hospitals nationwide to the Local Government Units (LGUs). The 580 public hospitals were devolved to the local government units (LGUs) while the DOH retained control of nine specialty hospitals most of which are in Metro Manila. Included in the devolution are the 44,000 of the 78,000 health personnel nationwide. Policy-making and regulations remained with the DOH but health service delivery was transferred to LGUs to ensure primary to tertiary health care delivery.

However devolution and decentralization have caused the country’s health system to become fragmented with imbalances in the resource allocation due to the widely varying capacities of LGUs. Devolution spared the national government health budget allocation for the devolved hospitals and health services.

With public hospitals devolved, Estrada issued his Executive Order 102 which redirected the functions and operations of DOH through re-engineering. DOH becomes a provider of specific health services and technical providers for health from being the sole provider of health services. The streamlining, according to DOH data, reduced 50% of 3,000 of DOH Central Office employees.

Estrada had his Health Sector Reform Agenda (HSRA) which pushed for privatization health facilities and services as per recommendation of World Bank. The main thrusts of the HSRA were:
  1. to provide fiscal autonomy to government hospitals;
  2. to secure funding for priority public health programs;
  3. to promote the development of local health systems and to ensure their effective performance;
  4. to strengthen the capacities of health regulatory agencies; and, expanding the coverage of the National Health Insurance Program (NHIP).

Reforms in the HSRA include corporatization of public hospitals, institutionalization of user fees in health services and facilities, and the integration of the four GOCC hospitals as Philippine Center for Specialized Health Care to cater to medical tourism. All these shift the government’s responsibility to its people’s right to health to the private sector.

HSRA claimed to be out to “increase access to health services especially by the poor and to reduce financial burden on individual families”. But this contradicts its promotion for the continuous upgrading of the regional and national hospitals into income-generating and financially viable health facilities by allowing them to collect, retain and allocate revenue from user fees and other forms of revenue-generating activities. These revenue measures include among others, increasing the number of pay wards and private rooms and expanding the health insurance coverage and the package of hospital services to be reimbursed by the health insurance system.

HSRA further laid down the strategy of privatizing public tertiary facilities by converting them into public corporations which it claimed to be the solution for the country’s deteriorating quality of health care. Thus regional and national hospitals are being upgraded to perform highly specialized curative and rehabilitative service to increase revenue-generating capacity and improve their financial viability. The downside, however, is the displacement of true indigent patients when these hospitals unload them to give way to pay patients to attain fiscal autonomy and financial capability.

Corporatization was the catch word of Arroyo’s administration. Her Fourmula One and the National Objective for Health (NOH) 2005 - 2010 were drawn up to complement and serve as the implementing rules of the HSRA. Fourmula One for Health program is consistent with and implements the neoliberal agenda of World Bank’s 1993 World Development Report – Investing in Health. Its focus is corporatization of public hospitals and promotion of medical tourism. The National Objective for Health 2005-2010 stressed on mobilizing private sector resources and expanding the health insurance program.

With Arroyo, plans came up to corporatize the 68 public hospitals and another attempt to sell the Welfareville Property and the National Center for Mental Hospital.

Benigno Aquino’s Universal Health Care and Public-Private Partnership The Aquino administration has the Universal Health Care or the Kalusugan Pangkalahatan, his version and implementation of HSRA. It focuses on three major strategies which are:
  1. Financial risk protection through expansion of the National Health Insurance Program (NHIP) enrollment and benefit delivery;
  2. Improved access to quality hospitals and health care facilities;
  3. Attainment of the health-related Medium-term Development Goals (MDGs).
Aquino’s thrusts – Philhealth and Public-Private Partnership are all but privatization of health facilities and services.

  1. Philhealth
    While Philhealth promises free access to health care it squeezes even more the people’s money by their out of the pocket expenditure for their health needs. The National Health Accounts of the National Statistics Coordinating Board (NSCB) estimates that if 5% of Gross Domestic Product will be allotted to health, Philhealth’s share to the Total Health Expenditures (THE) will be only 17%. On one hand, World Bank’s data regarding the out-of-pocket share from the private sector to the Total Health Expenditures in the Philippines is as much as an average of 83.5% from 2007 – 2010.

    The government allotted Php 12.6 Billion for 2013 for the beneficiaries’ premium under the National Household Targeting System which covers a miniscule 5.2 million households. This is aside from the Php 63.4 Billion total premium expected collection of the agency. These figures alone are assurance of the private capitals’ return of investment and eliminate the chances of any losses. Financial risk protection is just among the many incentives the state offers to attract private investor.

    With Philhealth, it has been observed that: 1) Utilization rates are highest among employed members and remain very low among state-sponsored members; 2)The highest share of reimbursements go to the rich, private institutions and clients; 3) It enhances inequity.

    Conclusion therefore could be that:
    1. Philhealth cannot make up for the significant role of the state to provide adequate funds for health.
    2. It cannot mitigate the damages caused by privatization.

    The profit orientation of Philhealth will further exacerbate the health problems of the poor. The politicians will simply use this for their political agenda.
  2. Public-Private Partnership
    Public-Private Partnership (PPP) is Aquino’s centerpiece program for his Philippine Development Plan 2011 – 2016. There are two aspects which distinguish his PPP from that of his predecessors.
    1. The granting of regulatory risk guarantees, an innovation and vital development to the way privatization projects were handled in the past. These regulatory risk guarantees make sure that the government would pay the private sector the total cost in case external problems arise.
    2. The conscious and systematic inclusion of social services like health in PPP projects.

  3. With PPP, research and development (R&D) in health has taken a new status. The government has never invested in R&D, now it is even at the forefront of advocating that private sector takes over this very crucial function. Rolled out for PPP programs are San Lazaro Hospital, Philippine Orthopedic Center, Research Institute for Tropical Medicine. These specialty hospitals will be transformed into research centers. This will erode the government capacity to develop knowledge for the good of the society such as technological breakthroughs in disease prevention and cure. Hospitals targeted for PPP have been under the government’s zero capital outlay policy and budget cuts.

    Budget cuts for health are well-defined in the health financing scheme of the Aquino administration. By 2014 the Maintenance and Other Operating Expenses (MOOE) will be cut off totally. By 2020 the budget for Personal Services will have zero allotment. By then, DOH-retained hospitals are expected to be fully corporatized and autonomous and will not receive any subsidy. Health services will be through health insurance system which is a private enterprise specifically Philhealth. Aquino’s health plan is paving the way for private businesses to gradually take full control of the country’s health care delivery. Consequently, this will deprive even more the poor of their right to health.
What is privatization?

Privatization is the abandonment of the state’s responsibility to ensure people’s health and the operation of public health services and institutions into profit-oriented enterprises.

Privatization is a global phenomenon; part of neoliberal policies developed since 1970’s when the world capitalist system was under severe economic crisis. To solve the crisis, the world monopoly capitalists initiated restructuring formula on a global scale and imposed the neoliberal globalization at the core of which are privatization, deregulation and liberalization through their International Financial Institutions - the IMF, WB and Asian Development Bank.

Privatization is the key thrust of the Structural Adjustment Program (SAP) since the Marcos administration and subserviently and doggedly pursued by each succeeding administration. SAP is a serious attack on the people and its sovereignty by deregulating laws and diminishing the state’s capacity to protect the welfare and rights of its citizens. It focuses on integration into the dominant global capitalist structures of trade, finance and production. Its programs are based on short term, profit maximization methods that perpetuate poverty, inequality and environmental degradation.

SAP and other stabilization programs were imposed by the International Financial Institutions (IFIs) on the Philippines to ensure payment of its ever-increasing foreign debts particularly to IFIs themselves. This result in government’s cutting heavily on health budget and other social services and turning over public services and institutions to the private sector. This transforms health from being a basic social service or public good to a commodity traded in markets for profits. SAP further opens liberally the Philippines as market of the world monopoly capitalists’ surplus products and venue for their export capital.

Each administration allots a significant portion of the national budget for debt-servicing. In contrast, the government expenditure for health is just a fraction of the World Health Organization’s (WHO) recommendation of at least 5% of the country’s Gross Domestic Product (GDP). The 2013 budget for debt payment is Php 333.9Billion while health budget is a measly Php 56.8Billion.

This budget proves the government’s ironic move to privatize health care. Furthermore, despite the glaring economic incapacity of the majority Filipinos, they still have to produce out-of-pocket contributions for their health needs. The total out-of-the pocket health expenditures in the Philippines is as much as 83.5% average from 2007 to 2010 according to World Bank data.

Forms of Privatization in the Philippine Health Care Delivery:

Privatization comes in several forms apparently to create an illusory cover to hide the real essence behind its intent. This is a grand design of the International Financial Institutions (IFIs) to generate super profits and to have firm control over the Philippines which has accumulated a whopping $62.9 billion debt for the first quarter of 2012 from these institutions. To accrue funds for debt payment and accommodate surplus capitals of IFIs the following the following are the modes to privatize government assets:
  • Outright sale of a public asset - The Welfareville Property and National Center for Mental Hospital at the behest of the World Bank in collusion with DSWD, DOF, DENR, DOJ, COA is again up for sale.

  • Privatization of operations and maintenance/outsourcing/contractualization - Examples of outsourced services are: janitorial, dietary, security services; the radiology facility Himex at Jose R. Reyes Memorial Medical Center (JRRMMC), and the HiPrecision laboratory at Tondo Medical Center (TMC) among others. The radiology services at JRRMMC and the laboratory services at TMC which were used to be free before the operation of these private-owned facilities are no longer available.

    The one year contract of RNHeals is an example of the massive contractualization in the public health institutions. These nurses receive a meager Php 8,000 monthly allowance and an additional but optional Php 2,000 from the employer which is either a public hospital or a local government unit.

  • Public-Private Partnership (PPP) - This is the flagship program of the Aquino government and has lined up at least three (3) public hospitals for privatization and some plans which are:
    1. San Lazaro Hospital (SLH) – this is the country’s prime hospital for infectious diseases. Foreign private investors will transform the existing facilities into a clinical research center for infectious disease.
      • Approximate cost – Php 5.44 Billion/(USD 121.87Million)
      • Revenue opportunity – Income sharing; lease per treatment, clinical trials for research and data mining
    2. Philippine Orthopedic Center (POC) – this is the only specialty hospital for bone problems. This will be developed as the country’s center for bone diseases, trauma, rehabilitation and commercial production of limb prosthesis.
      • Approximate cost – Php 2 Billion/(USD45Million)
      • Revenue opportunity – lease fee per treatment for diagnostic equipment
    3. Research Institute for Tropical Medicine (RITM) – this is being developed for local production of Pentavalent vaccine (DPT, HepaB and HiB)
      • Approximate cost – Php .5 Billion/(USD 11.11Million)
      • Revenue opportunity – sales/revenue sharing
    4. Rizal Medical Center (RMC), the training of RMC personnel has been contracted out through a MOA with the Makati Medical Center Foundation chaired by Manuel Pangilinan.
    5. Establishment of a Multi-Specialty Center in Oncology, Neurosciences, and Stem Cell Research in DOH retained hospitals. 10 hospitals for upgrading and the needed equipment have been identified.
      • Cost – Php 2 Billion (US$45 Million)
      • Revenue opportunity – lease per treatment
    6. Open land area of Eversley Child Sanitarium in Cebu and the Western Visayas Sanitarium in Iloilo are also up for sale.
      • Cost – will depend on the identified operations established by the PPP partner.
      • Revenue opportunity – rent, income sharing

    The modernization of government-owned hospitals is meant mainly to cater to medical tourists, who are expected to take advantage of the skilled manpower, state- of- the-art technologies and relatively lower costs of health services.

    The development of POC as the Premier center for Bone Diseases, Trauma, Rehabilitation and Commercial Production of Prosthesis as well as the establishment of Multi-Specialty Centers for Stem Cell Research, Neurosciences and Oncology in DOH-retained hospitals are within the implementation of the Medical Tourism Program.

    These infrastructure projects are definitely business oriented. The revenue opportunities for each project clearly show that when private sector takes over health services from the government, people’s right to health becomes a commodity.

  • Conversion of public hospitals into corporations – at present 26 hospitals nationwide are the targets of House Bills 6069 and 6145 and Senate Bill 3130 for corporatization. There were earlier attempts to corporatize 68 public hospitals which had been shelved. The poor will be marginalized further if these bills are passed.

  • Integration/merging of public hospitals – the plan to integrate the GOCC hospitals: PHC, LCP, NKTI, PCMC and the East Avenue Medical Center is aimed at putting up the Philippine Center of Specialized Health Care. This is part of the medical tourism program which promises lucrative return of investment for the investors. DOH claims that its objective is to achieve world class health care. However, this will be for the well-off that can afford and will definitely deprive the poor who cannot.

  • The relatively cheaper rates for various procedures in the Philippines will surely attract foreign patients to the specialized health care center. In US, labaroscopic gastric bypass costs from $35, 000 to $52,000 while in the Philippines it is from $2,000 - $3,500. Kidney transplant ranges from $200,000 - 250,000 in US. In the Philippines it is from $23,000 to $250,000. The big discrepancies of rates in US compared with those at these centers will assure highly profitable business ventures and will attract local and foreign capitalists. Also, the center will be an open market for the western-made equipment as part of import liberalization.

    On the other hand medical tourism will encourage the illegal organs sale which is becoming rampant among the poor Filipinos. A significant number of so called “donors” have been lured by fraudulent middlemen to sell their organs particularly kidneys. These brokers get the big portion of the sale while the donors receive only a small almost a token undeserved share.

  • Conversion of a maternal and new born tertiary hospital into a women’s wellness center - this is what will happen with Dr. Jose Fabella Memorial Hospital, a maternal and new born tertiary hospital with 80 – 100 deliveries daily and home to some 300 mothers at a time. The conversion will displace the patients who are mostly from the poor families of Metro Manila to give way to a center for wellness and beauty enhancement of women who can afford to pay.

  • Establishment of private entities within a public hospital - private health facilities and services have been put up at the Faculty Medical Arts Building (FMAB) of UP-PGH. Most often, laboratory equipment are not functioning and supplies are not available at PGH. Thus, patients are advised to proceed to FMAB for their laboratory needs where fees are much higher compared even with other private laboratories. Besides, to avoid the long and tedious wait at the Out- Patient Department, some are forced to proceed to FMAB for faster service they need and to shell out-of-pocket fees. No free services are available for the Class D patients.

  • Revenue enhancement/user fees schemes – hospitals resort to fund-generating schemes to augment the hospitals’ reduced/insufficient budget and to attain the fiscal autonomy expected of them. Patients have to pay even for the most basic services and supplies like inserting of intravenous line, cotton balls, adhesive tape and the like which were free before. At the Philippine Heart Center (PHC) and the Lung Center of the Philippines (LCP), hospital premises are leased to private capitalists to raise revenues. The number of charity wards has been reduced to give way to pay patients. At the PHC from the 70% allotted to charity beds was reduced to 20%.
Privatization undoubtedly transforms state-provided health facilities and services into business. Allowing business ventures to take over the government’s responsibility will surely result to health and health services:
  • Becoming an expensive commodity. It ceases to be a right;
  • Being run with cheap labor resulting to underpaid, overworked health workers, contractualization, outsourcing, agency-hired job orders without benefits;
  • Becoming affordable only for the rich and those who have money and inaccessible for the poor intensifying the latter’s deprivation and marginalization;
  • Treating patients as clients.

The Effects of Privatization

The majority poor Filipinos will suffer the burden caused by privatization. Health will become more of a privilege and a commodity rather than a right of everyone to be provided by the government. Furthermore, it will result to:
  1. Inequitable access to health facilities, goods and services. Increased fees for laboratory examinations and services have been noted at the National Kidney and Transplant Institute (NKTI). Last 2011, dialysis costs Php3, 000 per session. In 2012 it went up to Php 3,500 and no charity service is available. In other hospitals it is Php 2,500 or even less. The “no pay no hook” policy for dialysis is strictly implemented at NKTI. This means no session will be started before payment is made.

  2. At the Lung Center of the Philippines (LCP), a Php 10,000 deposit is required before admission. At the Philippine Children’s Medical Center, until 2011 when it was exposed in Congress, it was reported that patients who cannot pay the bills are forced to mortgage whatever valuable they have like cell phones, electric fan, wrist watch etc. so they could be discharged.

    The number of patients who cannot afford the privatized health care will increase which will result to further deterioration of the country’s health situation.

  3. Increased out-of-pocket share of patients reaching as much as 83.5% of total Philippines health expenditures according to World Bank data. Philhealth does not shoulder the entire bills of the patients. The paying members benefit more than the sponsored members. It specifies only some kind and number of diseases and the amount it covers for hospitalization. It requires a minimum of 9-month maturity of membership premium for member to avail of its service. In far-flung areas where Philhealth accredited health facilities, necessary medicines and worse when even health professionals are absent, the insurance is certainly an ineffective and frustrating proposition.

  4. Prevalence of user fees, services for a fee, and revenue enhancement schemes in public hospitals. The previously basic free services and supplies are now charged. This will make health care more inaccessible for the poor. The reduction of charity beds to give way to paying patients will displace the true indigents.

    Some public hospitals have upgraded their facilities but fees have increased tremendously. As comparison, at Dr. Jose Fabella Memorial Hospital chest x-ray for PA is Php 100, at PGH it is Php 340. At Philippine Heart Center it is Php 415 and at the National Kidney and Transplant Institute it is Php 485 at OPD with PF of PHP 185. For In-pay it is PHP720 with Php 250 PF, for In-private, it is Php 895 with Php 310 PF and for In-suite, it is Php 1,085 with Php 370 PF.

  5. Upsurge of medical tourism which will marginalize the majority poor Filipinos. This will further encourage the manipulative organ sale which prejudices the donors’ health that get a scanty amount relative to the broker’s share. The donors are mostly from the country’s impoverished urban and rural communities.

  6. Health care based on the ability to pay clearly and inevitably undermines the health needs of the poor and deprives them of their right to health. The increase in number of pay wards, the upgrading of health facilities for paying patients and the prevalence of user fees schemes and other for- a- fee services contradict the very principle that health is a social good and not a commodity. Medical tourism is the most revealing proof of health becoming a commodity.

  7. Privatization policies have led to the closure or dissolution of government units and hospitals which were at the forefront of providing secondary and tertiary health services. The number of public hospitals has decreased from 1,794 in 1999 to 1,361 in 2005. Most of the hospitals that were closed were district hospitals. The number of Rural Health Units (RHU’s) also decreased from 2,335 in mid-1990’s to 1,879 in 2001. The closing down of community and emergency hospitals in 10 towns in Isabela after the provincial government decided to merge them with bigger facilities has affected 300,000 people living in poor areas far from urban centers.
Impact of privatization on the health workers will have a significant toll. There will be standardization of functions which will result to massive retrenchment of regular employees. To soften the blow, the affected will be offered early retirement plan. Medical and physical examinations will be conducted and those who fail will be the priority in subsequent retrenchments.

Privatization will mean reorganizing the human resources. This is a major threat to health workers’ security of tenure. For those who will survive the retrenchment, it will result to downgrading of the employees’ ranks which will definitely affect their salaries. The contractuals or job order workers will replace the retrenched regulars to cut on expenses. At present vacated plantilla positions either through retirement or death of the employee are permanently left unfilled. At the Philippine Heart Center, there are 50 RNHeals employed for one year and 487 contractuals and all are without benefits.

The workers’ economic and democratic rights and benefits prescribed under the Magna Carta of Health Workers or RA 7305 will be forfeited. These gains will not be recognized under private institutions. This is more than curtailment. It is disregarding all together the health workers’ gains under RA 7305 which are fruits of their persistent and concerted struggles.

At the Lung Center of the Philippines (LCP) disallowance of benefits amounting to almost P200, 000 per employee is being implemented. These are charged upon retirement which divests the employees their retirement benefits. In a number of cases, the health worker had to pay his entire retirement benefit for his disallowances.

There could be more negative effects of privatization on health workers and the patients we are serving. This should be a motivation for everyone to vehemently expose and oppose the schemes of the International Financial Institutions and the conspiring local capitalists and the bureaucrats. Upgrading and improving the health care delivery are a must for it to be appropriate and responsive to people’s needs. However, if these are left to the private business, health care becomes business for profit. The people’s right to health becomes a commodity for sale.

Our stand against privatization

We believe inefficiencies in government-run health facilities and institutions are but results of the systemic neglect on health. The tell tale sign is the government’s non-priority in allocating appropriate health budget and its subservience to the impositions of the monopoly capitalists supported by the scheming local bureaucrats and capitalists. Health budget gets a measly sum compared to debt servicing and the military. As a result, our health care delivery system is very much wanting in quality of both in its services and in management. The prevailing political influence/patronage and corruption at every corner of the bureaucracy worsen further the country’s despicable health care situation.

Privatization of health facilities and services is geared toward serving the medical needs mainly of those with ability to pay. Corporatized hospitals will increase the number of their pay wards, will upgrade their facilities to cater to fee-paying individuals seeking medical and health-related services. The Aquino government is vigorously promoting medical tourism touted to improve efficiency and quality of services. On the contrary, this is against the principle of health being a social good. Medical tourism is the apex of health as a commodity. The well-off patients seek the cheapest price for a service while the providers making the most profit out of that service. The poor, on one hand are increasingly marginalized by the system.

The government and advocates claim corporatization is not privatization. However, corporatization is privatization of public or government-owned assets and/or services no less. The board of trustees which takes over the management is mandated to enter into financial transactions it believes will make profits to attain fiscal autonomy and viability. This is clear in the DOH Health Financing Scheme which states that by 2020 all DOH retained hospitals will be fully corporatized and will not receive subsidy. The transformation of the service orientation of public hospitals into profit-driven venture and the shift of health care from the state to private entities is clearly privatization.

The profit orientation of public health care turns public hospitals into business. If the 26 public hospitals are corporatized, the huge “savings” will be an enormous amount for the debt payment to the IFIs, and a guarantee of private investors’ lucrative return of investment at the expense of the people’s welfare.


Privatization of government-run facilities and services is the state’s ultimate disregard of the people’s right to health in spite of the clear mandate from both national and international covenants. It is an eloquent testimony of the state’s abandonment of its responsibility to the people giving utmost priority and preference the interest of the monopoly capitalists and the colluding local capitalists and bureaucrats. This vividly illustrates the subservience of the ruling elite to the dictates of the IMF-WB at the expense of the people. Worse, they use the people’s welfare and interests to justify their oppressive and exploitative programs imposed through the neoliberal policies by the foreign capitalists primarily the US controlled IMF-WB.

These policies are encroachment on the democratic and sovereign rights of the people and the country. This will ignite and stoke the sentiments of progressive individuals and groups who could not just allow the situation to continue on its rampage. In health care system, relegating its delivery in the hands of the private capitalists, the people’s right to health ceases and instead becomes a commodity for profit. This will worsen the health condition of the majority of the Filipino people while enriching further the bureaucrats, the local and the monopoly capitalists.

At present, the Philippines needs a radical change of the socio-cultural, economic and political systems in order to develop a health care delivery system relevant and responsive to the people’s needs. People’s health can only be guaranteed in a society that is free from the domination of neocolonialism and dictates of monopoly capitalism. Health must be free, comprehensive and progressive provided by the state for it to be truly pertinent and responsive to the health needs of the people at any given time. It must be part of the state’s centralized and comprehensive planning together with national industrialization and genuine agrarian reform program under a truly democratic and sovereign government.

Our Calls:
  1. Unite and fight to stop privatization!
  2. Junk PPP, corporatization and all forms of privatization!
  3. Immediately allocate Php 527 Billion for health!
  4. Fight for a free, comprehensive and progressive health care!
  • LUZON:
    1. Cagayan Valley Medical Center (Tuguegarao City, Cagayan Valley)
    2. Veterans Regional Hospital (Bayombong, Nueva Vizcaya)
    3. Baguio General Hospital and Medical Center (Baguio City)
    4. Ilocos Training and Regional Medical Center (San Fernando, La Union)
    5. Region l Medical Center (Dagupan City, Pangasinan)
    6. Dr. Paulino J. Garcia Memorial Research and Medical Center (Cabanatuan City, Nueva Ecija)
    7. Jose B. Lingad Memorial Medical Center (San Fernando, Pampanga)
    8. Batangas Regional Medical (Batangas City)
    9. Bicol Medical Center (Naga City, Bicol)
    10. Bicol Regional Training and Teaching Hospital (Legaspi City, Bicol)
    11. Quirino Memorial Medical Center (Quezon City)
    12. Jose R. Reyes Memorial Medical Center (Sta. Cruz, Manila)
    13. Rizal Medical Center (Pasig City)
    14. Amang Rodriguez Medical Center (Marikina City)
    15. San Lazaro Hospital (Sta. Cruz, Manila)
    1. Vicente Sotto Memorial Medical Center (Cebu City)
    2. Eastern Visayas Regional Medical Center (Tacloban City, Leyte)
    3. Corazon Locsin Montelibano Memorial Regional Hospital (Bacolod City, Negros Occidental)
    4. Western Visayas Medical Center (Iloilo City)
    1. Northern Mindanao Medical Center (Cagayan de Oro City, Misamis Oriental)
    2. Southern Philippines Medical Center (Davao City)
    3. Zamboanga City Medical Center
    4. Cotabato Regional and Medical Center (Cotabato City)
    5. CARAGA Regional Hospital (Surigao City)
    6. Davao Regional Hospital (Tagum, Davao del Norte)
    7. Mayor Hilarion A. Ramiro, Sr. Regional Training and Training Hospital (Ozamis City, Misamis Occidental)
  • “PPP: Profits over Public Welfare”, IBON Facts and Figures, 15 & 31 July 2011.
  • “Health for Sale”, Ibon Special Release, 30 Oct. 2009.
  • “Chronically Ill: An Overview of the Philippine Health Sector”, Ibon Books
  • “Privatization Corporate Takeover of Government”, Ibon Databank and Research Center
  • “Pagsasapribado ng Serbisyong Pangkalusugan: Kamatayan ng para sa Mamamayan” AHW Update, April 9, 1996.
  • Remigio Mercado, “Privatization of Specialty Medical Centers, a Cause for Concern”. College of Public Health, UP Manila, Feb, 1996
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  •, june 2011
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