[Fin Talk] Financial Health Matters in a Pandemic
By Arlyn Tan
Healthcare Costs caused by COVID have been taking a toll on both the family’s emotions and physical health. With the vaccine roll-out at 17% of the Philippines population only and the threat of delta’s increased transmission rate, the Filipinos can’t discount the possibility that a family member will contract the virus. It is not uncommon for multiple family members contracting the virus at the same time, causing them income disruptions.
The impact of the pandemic on the family's financial health may surprise everyone. Admissions in PGH in August 2020 cost ranged from 50,000-150,000. I had heard stories where a family shelled out 5M because the patient was in the ICU for 30 days. All these had people revisiting their emergency fund levels, the government subsidies, and medical insurances in the market. Without the financial aid from the public and private financial systems, the family will do the medical fundraising on their own. They will source it from their liquid assets like bank deposits and capital market investments.
This article will provide you with information on the latest Philhealth benefits and Private Institutions participation in medical funding.
The benefits of admitted patients vary based on the diagnosis: P43,997; mild pneumonia, P143,267 moderate pneumonia, P333,519 severe pneumonia, and P786,384 critical pneumonia.
An intermediate package for previously managed as probable Covid-19 case but had negative RT-PCR test results are also covered with the Intermediate package amounting to P18,000 and P38,000 for moderate and severe/critical pneumonia, respectively.
Home Isolation Benefit Packages will be available to those who meet the social and clinical criteria for home quarantine. COVID-19 patients who are mild and asymptomatic and isolating at home are now covered by a Philippine Health Insurance Corporation (PhilHealth) benefit package. They will be assessed by the Barangay Home Health Emergency Response Team. The state health insurer said that the corresponding reimbursement rate is P5,917.00 per claim. This will take effect 15 days after the publication date which is August 19, 2021. Only patients living in the high-risk or surge areas declared by IATF can benefit from the package.
Mandatory Services include minimum 10-day home isolation consultations, 24/7 daily monitoring of clinical and supportive care by a nurse through teleconsultation, provision of home isolation kit, patient education and patient referral to higher level facility for transfer.
Eligibility of patients:
In-patients who are diagnosed with Covid.
Patients who are admitted in the Emergency Room while waiting for room availability for at least 24 hours or more.
Patients who are admitted in tents in areas of high to critical risk.
Patients who meet the social and clinical criteria for home quarantine.
By subscribing to the health maintenance plans and critical illness insurance, individuals can outsource the risks that can cause high economic losses due to acute conditions and critical illnesses. The health maintenance plans are managed by HMO which controls the costs by limiting services to a local network of doctors and facilities. The health card subsidizes the hospital bills, and diagnostic services, and professional fees based on the terms and conditions of the contracts.
The critical insurance plans in the Philippines are managed by the life insurance companies. It provides lump sum and hospitalization benefits to individuals who are diagnosed with critical illnesses like cancer, heart attack. The coverages start from 300,000 and can be as high as 20,000,000.
The Philippines has a healthcare system different from the US or Canada where their governments subsidize a big amount of the healthcare costs. Because of this, the Filipinos need to find economical ways to raise funds. It is cheaper to pay the institutions annually with premiums for the liquidity when unexpected illnesses are diagnosed. The premiums are affected by gender, age, habits and health conditions.
Without the two sources of funding, the family is faced with the herculean task of fundraising. The milestone funds can also be used for the medical purpose. The milestone fund can either be the retirement or education or home construction fund. For the less privileged, a milestone like college degree or a comfortable retirement will need to give way totally to support a sick family member.
Be Vaccinated. The full vaccination can minimize hospitalization, occurrence of critical cases and death. Apart from this big benefit, it will help us cut the chain of passing the virus to others. No vaccine yet will protect the person 100%. Thus, all of us are encouraged to continue the health protocols and stay home as much as we can.
Have a Healthy Lifestyle. Resting can increase one’s well-being and can make a positive impact on productivity, eating and sleeping patterns. Although it is tempting to eat junk foods, sweet pastries and fatty foods, try to limit and replace them with a variety of fruits and vegetables. Stay active so the endorphins can make you feel happier. Reach out to family and friends for support during bad days. It is okay not to be okay.
Health is wealth. Despite the many attributes of wealth, wealth is measured by the net worth (assets minus the liabilities) of a person in the field of personal finance. When a family fails to plan their medical funding before a medical crisis happens, they can experience their cash levels and net worth abruptly declining. The healthcare costs extend from hospital bills, the daily living expenses, medicine costs, the caregivers fees, to the opportunities lost from stopping work. We are not yet out of the woods. Stay alert to prevent a medical crisis becoming a financial crisis. Preparation is the key.
Arlyn Tan is a Strategic Wealth Consultant. She helps individuals and organizations on how to maximize the value of their money through risk, health & wealth management. Her mission lies in making sure that clients achieve 3 things. First, they reach their milestones on time with sufficient resources. Second, they protect them from the impact of economic losses secondary to unexpected events. The third and most important is that they enjoy meaningful and balanced lives.
LinkedIn/Twitter: Arlyn Tan