WHEREAS, Section 11, Article XIII of the 1987 Constitution declares that the State shall adopt an integrated and comprehensive approach to health development which shall endeavor to make essential goods, health and other services available to all the people at an affordable cost;

WHEREAS, Republic Act No. 7875, as amended, otherwise known as the National Health Insurance Act of 1995, established the National Health Insurance Program (NHIP) to be administered by the Philippine Health Insurance Corporation (Philhealth) to operationalize the aforesaid constitutional mandate by providing health insurance coverage and ensuring affordable, acceptable, available and accessible health care services for all citizens of the Philippines.

WHEREAS, Administrative Order No. 277 (s. 1996) directs concerned government agencies to ensure the immediate and effective implementation of the NHIP;

WHEREAS, pursuant to R.A. 7875, as amended, and its implementing rules and regulations, the premium contributions for the indigent members of the NHIP are subsidized jointly by the National Government (NG) and the Local Government Units (LGU) where the indigent member resides;

WHEREAS, Executive Order No. 276 (s. 2004) mandated the Philippine Charity Sweepstakes Office (PCSO), the Department of Budget and Management (DBM), Philhealth and LGUs to accelerate the coverage of indigent families through the "Enhanced PCSO Greater Medicare Access Program", which covered approximately 4.3 million indigent families nationwide;

WHEREAS, continuing to provide affordable and accessible health care services will greatly benefit the public who are unable to avail of quality medical assistance;

WHEREAS, certain LGUs are financially unable to provide counterpart subsidies of contribution for the renewal of the coverage of their constituent indigent families;

NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the Republic of the Philippines, by virtue of the powers vested in me by law, do hereby order:

SECTION 1. Philhealth shall provide health insurance coverage to 2,500,000 indigent families subject to the implementing rules and regulations of this Order to be promulgated by Philhealth within fifteen (15) days from the effectivity hereof.

SECTION 2. The DBM shall authorize the release of funds from any available sources, strictly in accordance with existing laws and regulations, in the amount of ONE BILLION AND FIVE HUNDRED MILLION PESOS (Php 1, 500,000,000.00) to subsidize the health insurance coverage of the indigent families under Section 1 of this Order.

SECTION 3. Given the operational manpower and other resource requirements needed to implement this Order, Philhealth is hereby exempted from the pertinent provisions of Administrative Order No. 103 (s. 2004), provided, that the exemption shall be restricted to the essential operational manpower and resource requirements necessary to implement the activity specified under Section 1 of this Order. Further, Philhealth may defer the adoption of Executive Order 366 (s. 2004) until the implementation of the said activity, provided, that it shall adopt measures to efficiently and effectively deliver quality public services pursuant to its mandate and mission and at the same time improve its financial viability.

Philhealth shall submit regular reports to the Office of the President to monitor the implementation of the Administrative Order No. 103 (s. 2004) and Executive Order 366 (s. 2004) exemptions. The exemptions under this Order shall only continue for the duration of the activity.

SECTION 4. All orders, rules regulations, issuances, or parts thereof, which are inconsistent with this Order are hereby repealed or modified accordingly.

SECTION 5. This Executive Order shall take effect immediately following its publication in the Official Gazette or in two (2) newspaper of general circulation.

Adopted: 30 July 2005

(SGD.) GLORIA MACAPAGAL-ARROYO

By the President:

(SGD.) EDUARDO R. ERMITA
Executive Secretary