Duterte Orders PhilHealth: OFWs Premium Contributions Should Be Voluntary

Presidential spokesperson Harry Roque announced via PTV4 that President Rodrigo Duterte had directed the Philippine Health Insurance Corporation (PhilHealth) to make payment of increased premiums voluntary for OFWs.

PhilHealth increased contributions for overseas Filipino workers (OFWs) starting this year. OFWs whose monthly income ranges from Php10,000 to Php60,000 are now mandated to pay 3% of their earnings to PhilHealth, an increase from 2.75% in 2019.  

An Change.org online petition entitled, “Remove PhilHealth Mandatory 3% Payment from OFW’s Salary,” which aims to halt the OFW premium PhilHealth hike implementation, already gained close to 300,000 signatures. The Department of Foreign Affairs (DFA) Secretary Teodoro Locsin, Jr. also opposed it, reports Inquirer. 

"It is very unfortunate that they call OFWs modern heroes and yet they penalize us with such directives. We urge the Philippine Health Insurance Corporation (PhilHealth) to reverse this directive as this is unfair and an abuse to our migrant workers," read the petition. 

“It is like an income tax which was abolished for OFWs, and even their tax-free income filings were destroyed,” Locsin tweeted on Sunday. “They are just totally out of the purview of government exactions for which they will not benefit at all,” said the Foreign Secretary.

According to Locsin, OFWs already account for 10% of our gross domestic product (GDP) or country’s total earnings. Militant labor group Kilusang Mayo Uno (KMU) described it as an additional burden for OFWs who are also struggling with the impact of the COVID-19 pandemic. 

OFWs are classified as direct contributors under The Universal Health Care Act (Republic Act No. 11223), which dicates that remittance of PhilHealth premiums are mandatory.  

The OFW increase in PhilHealth OFW contributions is going to be yearly until 2025

PhilHealth’s Circular No. 2020-0014, which was released last April 22, 2020, shows the yearly increase of premium contributions of OFWs. Premiums are to be paid in Philippine pesos based on the exchange rate during the time of payment. 

OFWs' premium PhilHealth contribution increases to a rate of 3.5% in 2021 for OFWs who earn Php10,000 to Php70,000, 4% in 2022 for those who earn up to Ph80,000, 4.5% in 2024 for OFWs who earn up to Php90,000. In 2024 to 2025, the rate of contribution is 5% for OFWs who earn up to Php100,000 monthly. 

Regular Filipino employees also had an increase in PhilHealth contributions effective January 2019. (Read more about your increased PhilHealth contributions here.)

The new PhilHealth premium rates apply to OFWs living and working abroad as well as those on vacation, waiting for documentation, and whether registered or not in the National Health Insurance program. It includes land-based OFWs, seafarers and other sea-based OFWs, Filipinos with dual citizenship, and even OFWs in distress. 

Since 2020 is the transition year, OFWs are required to pay an initial premium of Php2,400 before they can leave the country. They’d need to pay the remaining amount through quarterly payments within the year. 

Starting in 2021, OFWs are mandated to pay three months’ worth of PhilHealth premium contributions based on the conversion rate at the time of payment. Failure to pay will incur monthly compounded interest. 

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