In an important move to support government workers, the Department of Budget and Management (DBM) has confirmed a new annual medical allowance of ₱7,000 for employees in the public sector. This benefit, set to start in 2025, is aimed at helping workers cope with rising healthcare expenses. It reflects the government’s commitment to employee welfare and well-being.
This new health benefit was made official under Executive Order No. 64, signed by President Ferdinand R. Marcos Jr. on August 2, 2024. It allows eligible employees to either use the amount for Health Maintenance Organization (HMO) plans or get it as cash reimbursement for their medical expenses. This flexible system is designed to give employees freedom in choosing how to manage their healthcare.
All types of government workers—whether permanent, temporary, or contractual—will be covered under this program. Institutions like national agencies, local government units, state universities, and local water districts are included. With proper guidance and monitoring, this program is expected to reduce out-of-pocket costs and improve access to healthcare for thousands of public servants.
Overview of the ₱7,000 Health Benefit
The new program gives every eligible government worker an annual health allowance of ₱7,000. It is a direct step toward making medical services more affordable and accessible for those working in public service.
Key Details:
- Annual Benefit: ₱7,000 per employee
- Start Date: 2025
- Eligible Workers: Regular, casual, contractual, and elected officials
- Usage Options: HMO plan or cash reimbursement
- Purpose: To assist with medical costs, consultations, treatments, and diagnostics
This program aims to reduce the financial stress on workers and improve their access to proper healthcare.
Who Can Avail the Benefit?
The allowance is available to a wide range of government employees, whether they are permanent, temporary, or serving in a contractual capacity. Here’s a breakdown of who qualifies:
Eligible Categories:
- Permanent Employees: Those with full-time and secure roles
- Casual and Contractual Staff: Government-hired workers in non-permanent posts
- Elected or Appointed Officials: Including barangay and municipal leaders
- Employees on Leave: Those still in active service despite being on extended leave
Covered Institutions:
- National Government Agencies (NGAs)
- State Universities and Colleges (SUCs)
- Government-Owned and Controlled Corporations (GOCCs) not under RA 10149
- Local Government Units (LGUs) including cities, municipalities, and barangays
- Local Water Districts
How to Use the ₱7,000 Medical Allowance
The program offers two flexible options to use the allowance depending on the worker’s preference:
1. HMO Plan Enrollment:
Employees may enroll in a health plan offered by an HMO. This covers:
- Medical consultations
- Laboratory and diagnostic services
- Hospitalization
- Preventive health services
2. Cash Reimbursement Option:
For more flexibility, employees may claim the allowance as a cash benefit. This can be used for:
- Doctor visits
- Medication purchases
- Out-of-pocket treatment costs
- Payment of personal health insurance
Receipts or proof of medical services must be submitted to claim the reimbursement.
How the Program Will Be Implemented
The DBM issued Budget Circular 2024-6 to explain the rules and steps for this benefit. Government agencies are responsible for ensuring a smooth implementation.
Process Overview:
- Agencies will provide either the HMO enrollment or reimbursement options
- Employees must submit proof of medical expenses for reimbursement
- The ₱7,000 is strictly for healthcare needs—it is non-transferable
- Help desks will be set up in offices to assist employees
This structured system aims to avoid delays and ensure the program runs smoothly.
Monitoring and Compliance
To maintain transparency and proper usage, the DBM will enforce monitoring rules:
- Annual Agency Reports: Required to show how funds were used
- Regular Audits: Scheduled and surprise checks will be done
- Possible Benefit Increase: Future reviews may adjust the amount to match inflation
These measures ensure fairness and sustainability of the benefit system.
Positive Effects on Public Sector Workers
This ₱7,000 medical support is expected to improve workers’ health and overall satisfaction. By reducing personal medical costs, workers can focus more on their jobs and worry less about healthcare expenses.
Benefits Include:
- Easier access to needed medical services
- Less financial stress due to health issues
- Fewer days off due to untreated illnesses
- Boosted morale and stronger job motivation
Budget Secretary Amenah Pangandaman noted that this allowance is not just support—it’s an investment in a better and more productive government workforce.