People-centered, clean, transparent. This is how the Marcos Jr administration describes the newly signed national budget, the General Appropriations Act (GAA) of 2026. But a closer examination reveals alarming symptoms of sick governance.
President Marcos claims that the 2026 budget will sustain his administration’s momentum toward national development by prioritizing essential social services such as education, health, food security, social protection, and job creation. Never mind the ‘momentum’ bit, as the economy is at its slowest growth, but even the claim of prioritizing social services is false.
The Php448.125 billion allocation for health is the highest ever for the sector, the Marcos Jr administration boasts, but it is only 1.45% of the gross domestic product (GDP), far from the 5% standard of the World Health Organization (WHO).
The government touts the increase as proof of its commitment to making health services accessible. But this ‘commitment’ only came on the heels of widespread public outrage over the flood control corruption scandals, which disrupted budget deliberations in Congress. The timing raises serious questions. The bloated health budget appears to be a damage-control measure – an attempt to regain public trust and project an image of a caring government.
The 2026 health budget bears red flags on many programs that seem to have benefited from budget realignments but are not going to improving direct service provision. The 2026 national budget, for health included, has remained a tool of patronage and corruption.
Soft pork
The 2026 health budget may be the largest on record, but this does not automatically translate into better health outcomes for the Filipino people. A substantial portion of the increase went to the Medical Assistance to Indigent and Financially Incapacitated Patients (MAIFIP). MAIFIP receives Php51.6 billion, more than double its originally proposed budget of Php24.2 billion. Compared to the 2025 allocation, the 2026 MAIFIP budget is Php10 billion or 25% higher.
MAIFIP has long been criticized as a soft pork barrel program. Its design allows local and national politicians to exercise patronage, as beneficiaries are often required to secure a guarantee letter from a politician to prove their indigency. This requirement has no clear legal basis, yet it has persisted for years because it serves the interests of the political elite rather than the people it claims to help.
The Commission on Audit (COA) has repeatedly flagged MAIFIP for concerning implementation issues. In its 2024 audit report on the Department of Health (DOH), COA cited delays in fund releases, unliquidated fund transfers, and inconsistent application of procedures. COA also reported that Php3.013 billion in MAIFIP funds remained unutilized, partly due to the program’s numerous requirements and complicated processes. For indigent patients who need urgent medical assistance, these bureaucratic hurdles often mean delayed or denied health care.
Even if the 2026 GAA prohibits the use of guarantee letters for cash and non-cash assistance programs, including MAIFIP, to purportedly curb political interference, similar prohibitions that have existed in the past have been routinely bypassed. Without strong enforcement mechanisms, this new provision risks becoming another empty rule.
More fundamentally, the effectiveness of MAIFIP in reducing the healthcare cost for poor and marginalized Filipinos remains questionable. Out-of-pocket spending continues to account for a large share of health expenses, while long processing time and excessive documentation requirements have become normalized burdens for those seeking MAIFIP assistance. So instead of investing these funds in strengthening the public healthcare system, the national government, for patronage’s sake, pours billions into a problematic assistance program.
Private infra business
Another major red flag in the 2026 health budget is the significant increase in funding for the Health Facilities Enhancement Program (HFEP). The DOH’s originally proposed Php14.47 billion for HFEP was raised to Php22.23 billion in the approved GAA. Construction of HFEPs is implemented by the involved DOH Regional Offices and local government units (LGUs), where the LGUs employ the services of private contractors.
Funding for the construction of new Barangay Health Stations (BHS), which was zero in the proposal, received Php50 million in the enacted budget. Regular HFEP support for DOH-retained hospitals, also initially proposed at zero, was granted Php1.18 billion. Support for LGU hospitals increased from Php6.9 billion to Php10.9 billion, primarily for infrastructure and medical equipment. Government-owned and -controlled corporation (GOCC) hospitals likewise received increases, with big allocations for the National Kidney and Transplant Institute (Php300 million), the Philippine Children’s Medical Center (Php400 million), and the Philippine Heart Center (Php200 million).
There is no denying the urgent need for new health facilities, improved infrastructure, and modern medical equipment. However, HFEP’s long record of inefficiency and mismanagement casts doubt on whether additional funding will lead to meaningful improvements. HFEP functions as the DOH’s centralized funding mechanism for infrastructure, equipment, and vehicle support for public health facilities. When it was first implemented, the program prioritized primary care facilities such as BHS and Rural Health Units (RHUs). But more than a decade later, the country still faces a severe shortage in basic health facilities, particularly in rural and underserved areas.
The problems are deeply rooted in the very nature of the Philippine health system, where the private sector is given a larger role to operate facilities and services and where health governance is devolved. Bureaucratic bottlenecks within the DOH and the transfer of responsibilities to LGUs and the LGUs dealing with private contractors complicate HFEP implementation. Audit reports have consistently flagged the program for slow disbursement, underutilization of funds, and project delays.
During the deliberations on the DOH’s 2026 proposed budget, it was revealed that 297 out of 406 HFEP-funded centers in 2023-2024 are non-operational. Only 82 HFEP-funded centers, called super health centers, were planned for the period, and most of the established ones were realized because of congressional insertions. Even DOH Secretary Teodoro Herbosa referred to HFEP facilities as the agency’s version of flood control projects. i.e. built but often unusable.
Many of the facilities remain idle due to lack of health personnel. HFEP funds cover only infrastructure and equipment, while operational costs and the hiring of health workers are left to LGUs. Poorer LGUs, however, lack the resources to sustain these facilities. Despite these well-documented concerns repeatedly raised during budget hearings, the bicameral committee has still chosen to increase HFEP funding.
Corruption-prone social insurance
The DOH and its attached agencies receive the largest share of the health budget at 66%, or Php297.5 billion, which is a 20% increase from the 2025 budget. Yet, the single largest share goes to the Philippine Health Insurance Corporation (PhilHealth), which is allotted Php129.8 billion, or 29% of the health budget, from zero allocation in 2025.
PhilHealth’s originally proposed budget was only Php53 billion, intended to subsidize the premiums of indirect contributors, namely indigent families identified through the National Household Targeting System for Poverty Reduction (NHTS-PR), senior citizens, and beneficiaries of the Payapa at Masaganang Pamayanan (PAMANA) program. Despite its record of fund mismanagement and corruption, PhilHealth’s approved budget more than doubled to Php129.8.
In 2025, PhilHealth received zero national government subsidy due to what was described as “huge” savings in its coffers. The agency was also reported to have excess funds amounting to Php89.9 billion. The Department of Finance (DOF) ordered PhilHealth to remit a portion of these funds to the national treasury for use in other government programs. PhilHealth transferred Php60 billion, prompting civil society groups and several lawmakers to file a petition before the Supreme Court.
During the hearings, PhilHealth and the DOF defended the transfer, claiming the funds were used for health-related purposes, including the COVID-19 Health Emergency Allowance (HEA) for health workers and the procurement of medical equipment. But it later emerged that Php13 billion of the transferred funds had been allocated to foreign-assisted infrastructure projects, including the Panay-Guimaras-Negros Island Bridges, the Davao City Bypass, the Metro Manila Subway, and the Bataan-Cavite Interlink Bridge.
In December 2025, the Supreme Court ordered the return of the transferred funds to PhilHealth and ruled that the special provision in the 2024 GAA allowing the transfer constituted grave abuse of discretion. However, the Court declined to determine the liability of former DOF Secretary Ralph Recto and ruled that President Marcos acted within his authority. Once again, despite a clear abuse of public funds, no one was held accountable.
PhilHealth’s ability to accumulate massive savings exposes a deeper problem. The country’s public health system continues to be insurance-driven instead of being focused on direct service provision, especially on primary health care. Yet, despite the obsession with insurance, there is chronic underspending on people’s health benefits. Data from the Philippine National Health Accounts (PNHA) show that from 2020 to 2023, PhilHealth’s average share in the country’s current health expenditure (CHE) was only 12.8%, while households shouldered an average of 43.7% through out-of-pocket spending. For 2024, the DOH reported that 14.0% share of the CHE came from PhilHealth—this is still far from the Health Care Financing Strategy (HCFS) target of 19.1%. But the official publication of PNHA does not reflect this breakdown of government financing schemes, a reflection of the government’s customary lack of transparency.
Treating structural ills
The Filipino people have long demanded increased and prioritized public financing for health. This demand arises not from abstraction, but from the lived reality of chronic system failure—overcrowded public hospitals, understaffed facilities, and unequal access to care. While the urgency of addressing these failures cannot be overstated, simply enlarging the health budget while entrenching a neoliberal, insurance-driven framework will not deliver better health outcomes.
What Filipinos need is not a cosmetically expanded budget that preserves a privatized, devolved, and corruption-prone health system. Primary health care remains marginalized, even as spending and policy attention gravitate toward curative care and insurance reimbursements. Healthcare workers continue to be overworked, underpaid, and denied timely benefits, despite carrying the burden of a system stretched to its limits. Meanwhile, public funds leak into soft pork-barrel programs, opaque allocations, and insurance pools vulnerable to waste and abuse—diverting resources away from direct service delivery, public hospitals and clinics, and a strong primary health care network.
Taken together, the structure and priorities of the 2026 health budget constitute not merely a policy failure, but a violation of the people’s right to health. The state has an obligation to ensure accessible, equitable, and quality health care, and that obligation cannot be outsourced to private actors or diluted through devolution. As head of government, President Marcos Jr bears responsibility for a budget that reinforces these structural harms instead of correcting them.
Until the Marcos Jr administration decisively abandons neoliberal policies in health and confronts corruption and opacity in health financing, no amount of rhetoric or headline figures can conceal the truth: this is an unhealthy budget, and it reflects political choices for which the Marcos Jr administration must be held accountable.