Cebu faces ₱5.2-billion gap in frontline health care funding - PIDS

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CEBU Province would need to spend more than five times its current health budget to provide the basic primary health care services required under the country's health reforms, according to a study by the Philippine Institute for Development Studies (PIDS).

Using 2024 fiscal data, Cebu spent about ₱1.21 billion on health, nutrition and population (HNP) programs. But the state think tank found the province would need around ₱6.5 billion to adequately provide primary health care (PHC).

These refer to basic health services delivered through barangay health stations, rural health units and local health centers.

The estimate leaves Cebu facing a funding gap of more than ₱5.2 billion.

The study also reported that provincial health spending would need to increase by about 5.3 times to meet the actual cost of delivering those services.

The findings were published in the March 2026 PIDS study, Are Philippine Local Governments Spending Enough on Primary Health Care?

Rather than relying on existing government budgets, the researchers estimated the actual cost of delivering primary health care by calculating the resources needed to provide essential services, including health workers, medicines, vaccines, laboratory tests and the operation of local health facilities.

The study estimated that fully funding PHC would consume about 23 percent of Cebu Province's operating income.

Current HNP spending, meanwhile, amounts to only ₱226 per resident, even though it accounts for 23.8 percent of the province's operating expenditures.

PIDS also found wide disparities among Cebu's three highly urbanized cities.

Cebu City spends ₱805 per resident on health but still faces a funding gap of 2.3 times its current spending, with total PHC requirements estimated at ₱1.82 billion.

Mandaue City recorded the largest shortfall, with estimated PHC costs 12.2 times higher than its current spending of ₱151 per capita.

Lapu-Lapu City, meanwhile, is relatively better positioned, spending ₱1,047 per resident and facing a smaller 1.8-fold funding gap.

The study also examined whether the 2018 Mandanas-Garcia ruling, which expanded local governments' share of national tax revenues beginning in 2022, led to higher investments in health care.

The researchers found that larger National Tax Allotment (NTA) shares did not automatically translate into greater spending on primary health care, as local governments continued to balance health budgets against competing priorities such as infrastructure and general administration.

In Cebu Province, where 63.6 percent of local income comes from the NTA, the study found that unconditional transfers alone were insufficient to close the financing gap.

To address the shortfall, PIDS recommended expanding demand-side financing by maximizing PhilHealth's YAKAP benefit package, which would provide local governments with earmarked reimbursements for primary health care services.

Without reforms in the way primary health care is financed, the study warned that underinvestment in frontline health services is likely to persist.(RBE)