Article 83Labor and Agrarian Laws and Social Legislation, p. 83

LABOR LAWS AND SOCIAL LEGISLATION SPECIAL LAWS AND IMPLEMENTING RULES AND REGULATIONS

benefit package, the balance of the SSS-Health Insurance

Fund (HIF) shall be constituted into a supplementary

benefit fund to finance the extension of benefits in

addition to the minimum basic package to SSS members

and beneficiaries; and

2)

supplementary

benefit

fund

for

GSIS-Medicare

members and beneficiaries. After deducting the amount

corresponding to the premium for the basic minimum

benefit package, the balance of the GSIS-HIF plus the

arrearages of the Government of the Philippines with the

GSIS

for

the

said

HIF

shall

be

constituted

into

a

supplementary benefit fund to finance the extension of

benefits in addition to the minimum basic package to

GSIS members and beneficiaries.

In accordance with the principles of equity and social

solidarity, as enunciated in Section 2 of this Act, the above

supplementary benefit funds shall be maintained for not

more than five (5) years, after which, such funds shall be

merged into the basic benefit fund.

SECTION

26.

Financial

Management .

—

The

use,

disposition,

investment,

disbursement,

administration

and management of the National Health Insurance Fund,

including any subsidy, grant or donation received for

program operations shall be governed by applicable laws

and in the absence thereof, existing resolutions of the

Board of Directors of the Corporation, subject to the

following limitations:

(a) All funds under the management and control of the

Corporation shall be subject to all rules and regulations

applicable to public funds.

(b) The Corporation is authorized to charge to the various

funds under its control the costs of administering the

Program.

Such

costs

may

include

administration,

monitoring,

marketing

and

promotion, research and

development, audit and evaluation, information services,

and

other

necessary

activities

for

the

effective

management of the Program. The total annual costs for

these shall not exceed the sum total of the following:

(1) Four percent (4%) of the total premium contributions

collected during the immediately preceding year;

(2) Four percent (4%) of the total reimbursements or total

cost of health services paid by the Corporation in the

immediately preceding year; and

(3)

Five

percent

(5%)

of

the

investment

earnings

generated during the immediately preceding year.

The

period

for

implementation

of

the

cost

ceiling

provided under this section shall not be later than five (5)

years from the effectivity of this Act during which period,

the total annual cost shall not exceed the sum total of the

following:

(i) Five percent (5%) of the total contributions;

(ii) Five percent (5%) of the total reimbursements; and

(iii)

Five

percent

(5%)

of

the

investment

earnings

generated during the immediately preceding year.

(National Health Insurance Act of 2013, Republic Act No.

10606, [June 19, 2013])

SECTION 27. Reserve Fund . — The Corporation shall set

aside a portion of its accumulated revenues not needed

to meet the cost of the current year's expenditures as

reserve funds: Provided, That the total amount of reserves

shall not exceed a ceiling equivalent to the amount

actuarially estimated for two (2) years' projected Program

expenditures: Provided, further , That whenever actual

reserves exceed the required ceiling at the end of the

Corporation's fiscal year, the excess of the Corporation's

reserve fund shall be used to increase the Program's

benefits,

decrease

the

member's

contributions,

and

augment the health facilities enhancement program of

the DOH.

The remaining portion of the reserve fund that are not

needed to meet the current expenditure obligations or

used for the abovementioned programs shall be placed

in investments to earn an average annual income at

prevailing rates of interest and shall be known as the

'Investment Reserve Fund' which shall be invested in any

or all of the following:

(a)

In

interest-bearing

bonds,

securities

or

other

evidences of indebtedness of the Government of the

Philippines, or in bonds, securities, promissory notes and

other evidences of indebtedness to which full faith and

credit and unconditional guarantee of the Republic of the

Philippines is pledged;

(b) In debt securities and corporate bonds issuances:

Provided, That such securities and bonds are rated triple

'A' by authorized accredited domestic rating agencies:

Provided, further , That the issuing or assuming entity or

its predecessor shall not have defaulted in the payment of

interest on any of its securities and that during each of

any three (3) including last two (2) of the five (5) fiscal

years next preceding the date of acquisition by the

Corporation of such bonds, securities or other evidences

of indebtedness, the net earnings of the issuing or

assuming institution available for its recurring expenses,

such as amortization of debt discount and rentals for

leased

properties,

including

interest

on funded and

unfunded debt, shall have been not less than one and

one quarter (1 1/4) times the total of the recurring

expenses for such year: Provided, further , That such

investment shall not exceed fifteen percent (15%) of the

investment reserve fund;

(c) In interest-bearing deposits and loans to or securities

in any domestic bank doing business in the Philippines:

Provided, That in the case of such deposits, this shall not

exceed at any time the unimpaired capital and surplus or

total private deposits of the depository bank, whichever is

smaller: Provided, further , That said bank shall first have

been designated as a depository for this purpose by the

Monetary Board of the Bangko Sentral ng Pilipinas ;

(d) In preferred stocks of any solvent corporation or

institution created or existing under the laws of the

Philippines: Provided, That the issuing, assuming, or

guaranteeing entity or its predecessor has paid regular

dividends upon its preferred or guaranteed stocks for a

period of at least three (3) years immediately preceding

the date of investment in such preferred or guaranteed

stocks: Provided, further , That if the stocks are guaranteed

the amount of stocks so guaranteed is not in excess of

fifty

percent

(50%)

of the amount of the preferred

common stocks as the case may be of the issuing

corporation:

Provided,

furthermore ,

That

if

the

corporation or institution has not paid dividends upon its

preferred

stocks,

the

corporation

or

institution

has

sufficient retained earnings to declare dividends for at

least two (2) years on such preferred stocks and in

common stocks of any solvent corporation or institution

created or existing under the laws of the Philippines in

the

stock

exchange

with

proven

track

record

of

profitability and payment of dividends over the last three

(3) years; and

(e)

In

bonds,

securities,

promissory

notes

or

other

evidences of indebtedness of accredited and financially

sound medical institutions exclusively to finance the

construction, improvement and maintenance of hospitals

and other medical facilities: Provided, That such securities

and instruments are backed up by the guarantee of the

Republic

of

the

Philippines

or

the

issuing

medical

institution and the issued securities and bonds are both

rated triple 'A' by authorized accredited domestic rating

agencies: Provided, further , That said investments shall

not exceed ten percent (10%) of the total investment

reserve fund.

As part of its investments operations, the Corporation

may hire institutions with valid trust licenses as its

external local fund managers to manage the investment

reserve fund, as it may deem appropriate, through public

bidding. The fund managers shall submit annual reports

on investment performance to the Corporation.

The Corporation shall set up the following funds:

© Compiled By RGL

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