The Commission on Audit (COA) conducted a performance audit of the Philippine Health Insurance Corporation (PhilHealth) All Case Rate (ACR) Payment Scheme covering the period since its implementation in 2011 until June 30, 2020.
Previously, PhilHealth utilized the Fee-for-Service payment scheme, health care institutions (HCIs) such as hospitals and clinics were reimbursed an amount based on the actual charges for the patient’s treatment. This led to delays in the reimbursement due to differences in rates and fees charged by each HCIs and the difficulty in validating such charges. In some instances, this also resulted in bloated charges.
Under the ACR Payment Scheme, PhilHealth pays all claims using a case rate which is a predetermined fixed rate for each covered case or disease. For example, natural childbirth has a case rate of ₱5,000, which will be paid uniformly among all HCIs. The result is that instead of undergoing the process of computing the reimbursements based on actual costs, the HCI will be reimbursed a fix amount, which may be more or less than the actual cost. The idea behind the ACR, which is utilized in other jurisdictions as well, is to incentivize HCIs to be more efficient. If the case rate for a specific treatment is lower than the actual cost, the HCI will try to be more efficient in the costing of the treatment. On the other hand, if the case rate is higher than the actual cost, the HCI gets to keep the difference as a form of “efficiency gains.”