Philippine Institute for Development DEVELOPMENT Studies Surian sa mga Pag-aaral Pangkaunlaran ng Pilipinas RESEARCH NEWS

Vol. XXXI No. 4 October – December 2013 ISSN 0115-9097

Economic growth Editor’s Notes

WE PRESENT to you, our readers, the must translate to better final issue of the revamped Development Research News (DRN) for 2013. Looking back, it was an interesting year that saw health outcomes the Institute become engaged in a number of pressing socioeconomic issues, many of which were tackled in the pages of the DRN. We started the year with the usual review of the economy in 2012 and prospects for DESPITE rapid economic growth in recent quarters, the Philippines faces myriad 2013. The second quarter issue examined challenges in providing adequate health care, and inequality in access to health the effects of trade liberalization in services is in fact high. It is high time for the government to focus on health as an developing countries. For the third quarter, important subject matter in policy research to directly confront the “conundrum” of the focus was Manila’s hosting of the 14th undeniable economic progress with stubborn social deprivation. Global Development Conference, in which social protection policies were put on spotlight. In this context, the theme “Making Health More Inclusive in a Growing Economy” c p. 16 was adopted for this year’s nationwide celebration of the 11th Development Policy Research Month (DPRM) spearheaded by the Philippine Institute for Development Studies (PIDS). What’s Inside

Health expenditures must be brought to at least 5 percent of gross domestic product as recommended by the World Health Organization, from the current 3 to 3.5 4 Effective impact evaluation: Knowing percent, said Oscar Picazo, PIDS senior health research consultant. Picazo presented what works and what does not data on worsening health conditions in the country as he laid the case for crafting a 5 Health department aiming for policy that will make health care more “inclusive” in the DPRM press conference last universal coverage Sept. 4 at the NEDA sa Makati Building. 6 11th DPRM showcases health innovations Maternal health alone—which serves as a good indicator of the health system as it 8 Study calls on gov’t to go into public- private investment partnerships in covers the entire spectrum of the referral scheme—is not improving as shown by a health spike in the maternal mortality ratio to 221 maternal deaths per 1,000 live births in 9 Inequalities in maternal, child care cited 10 Fill gaps in coverage, PhilHealth urged 11 Senate forum emphasizes need to enhance conditional cash transfer program 12 ‘Broad reform coalition’ needed to deal with enormous jobs challenge 14 ‘Inclusive growth must be asserted in AEC’ 15 PIDS, DFA tie up for APEC 2015 research project 15 PH ‘behind’ ASEAN neighbors in infra quality Development Research News October – December 2013

2011. Before that, the ratio had declined steadily to 161 in 2006 from 209 in 1990, based on government statistics. The infant mortality ratio, meanwhile, is decreasing but not as fast as neighbors in the region, Picazo told members of the press.

“Reproductive health has something to do with this,” he said. “There’s still a high number of children per woman … Unwanted pregnancies are high among the poor.”

Picazo also pointed to the high variation of health outcomes across socioeconomic classes and regions. For instance, there is a huge discrepancy in PhilHealth coverage between the rich and the poor—52.8 percent of the richest have coverage while only 21 percent Oscar Picazo (right), PIDS research consultant, and Dr. Irma Asuncion of the DOH of the poorest are covered, he said. (center) discuss the health challenges in the Philippines, the reasons behind them, and “Rich people are being subsidized by the steps the government must take to achieve better health outcomes. With them is PhilHealth,” he added. Dr. Aniceto Orbeta, Jr. of PIDS. (Photo: Gizelle Manuel)

There are three sets of underlying causes for large disparities in health, Picazo said. The third set of factors is systemic in “We cannot wait for growth effects to The first is the interplay between poverty, nature, Picazo said. Doctors, nurses, trickle down, we need the government income inequality, and the burgeoning and midwives are concentrated in Metro to interfere by formulating policies and population. Manila and nearby regions. While the programs to improve the state of health,” government has a program to upgrade she said. Hospitals are unable to accommodate health facilities, equitable distribution the growing number of clients, and the remains an issue, and the Department of The DPRM has been celebrated every number of health workers per population Health has limited absorptive capacity September since 2002, under Presidential is declining. Frequent disasters and despite increasing fiscal space for health Proclamation No. 247. PIDS has been environmental risks are also worsening expenditures. actively promoting and instilling inequality, Picazo said. national awareness and appreciation of The Philippines could do well to make the importance of policy research and The second challenge pertains to use of information technology to improve information in national development, the effects of demographic and health outcomes, such as by using laptop by focusing on various socioeconomic epidemiological transitions as well computers to connect patients with their themes such as climate change, poverty, as population mobility. The country’s doctors. “I don’t understand why we’re the and education. population is starting to age, which outsourcing capital of the world and we will lead to a shift in disease burden can’t do that,” Picazo said. The DPRM aims to cultivate a “culture to noncommunicable diseases from of research and research use” among infectious diseases. PhilHealth is also Discussing the DPRM theme, Dr. decisionmakers and the general public, unable to keep up as more Filipinos seek Rafaelita Aldaba, acting PIDS vice- as well as elicit support of the public for work overseas, which leaves dependent president, said facing this challenge could activities that advance the standard of families without health coverage. be the key to the country’s development. policy research in the Philippines. The

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PIDS partners for this year’s DPRM are said: “Our population is growing at 1.8 requesting a 16–17 percent increase in the National Economic Development million a year, but our hospitals clearly approved positions from the Department Authority, Philippine Information Agency, cannot accommodate this burgeoning of Budget and Management. Civil Service Commission, Presidential population.” Management Staff, Asia Pacific Communication strategy needed Observatory on Health Systems and Another important issue is human Policies, World Health Organization, and resource. Health workers are Coordination among government Center for Health Market Innovations. overburdened at different levels of care agencies is needed particularly in fighting and in different locations, leading to HIV-AIDS, which infects one Filipino Focus on poor families inequality in health care service delivery every 1.5 hours. There is also a lot of in the country. work to do in meeting the Millennium Aldaba noted that Brazil, China, and Development Goals for health, Asuncion other emerging economies have gone as “They are tasked to provide counselling, said. far as investing at least 7–8 percent of education, and information as well as their gross domestic product in education, recording and reporting, which may be The Philippines has the third highest training, and health. attributed to the fast turnover of staff and total fertility rate in Southeast Asia, volunteers,” Asuncion explained. and ranks fourth in infant and under-5 Economic growth makes it possible for mortality rate and fifth in neonatal and the health budget to increase, especially Citing 2011 data from the National maternal mortality as well as underweight with the recent passage of the Sin Tax Statistical Coordination Board, she children under five years old, the health Law on cigarettes and alcohol, which can pointed out that the lack of sufficient department official noted during the provide estimated incremental revenue health care workers is aggravated by the DPRM press conference. of PHP 84.3 billion in 2013, rising to increase in the country’s population. PHP139 billion in 2016. The country needs to upgrade health Filipinos are living longer, with females facilities, recruit and deploy health human “The sin taxes have already been having a longer life expectancy at 71.64 resources, ensure competency, and ensure committed, and the question then is how years than males at 66.1 years. Moreover, the availability of drugs, medicines, and could we absorb or spend this money data from the National Statistics Office vaccines, she said. equitably so that the poor will benefit showed that the proportion of older from health services,” Picazo said. persons is growing—from 3.83 percent of According to Asuncion, the government the population in 2000 to 4.19 percent in must also come up with adequate and The Aquino administration’s Universal 2007. effective communication strategies to Health Care program or Kalusugan reach target populations, specifically the Pangkalahatan is deliberately designed to The good news is that there is now a poor. focus on the poorest two quintiles of the working Maternal and Neonatal Death population, but expansion of benefits has Reporting System in the Philippines. The “We have to really track them to see if not reduced the out-of-pocket spending Unified Non-Communicable Disease they are utilizing the resources available to on medical care that has remained very Registry System or Oneiss will also be them,” she said. high, Picazo said. operational in the first quarter of 2014. Noncommunicable diseases are the Aldaba, for her part, summed up her Dr. Irma Asuncion, director of the top causes of death worldwide. In the presentation with a quote from Amartya National Center for Disease Prevention Philippines, diseases of the heart, the Sen, the Indian economist and Nobel and Control of the Department of vascular system, and malignant neoplasm economics laureate: “Growth must be Health, revealed there are 1,819 hospitals are the top three leading causes of death. accompanied by social capabilities like in the country, which has a total bed health, education, gender rights; healthy capacity of 101,914. This is equivalent, At the national level, the DOH is and educated population serves as she said, to a population-to-bed ratio of addressing the lack of health human foundation for economic growth.” FFS, one bed for every 960 persons. Picazo resources through a rationalization plan CSM, PMGV, KCOO

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Effective impact evaluation: Knowing what works and what does not

FOR DEVELOPMENT practitioners, it is Jessica Kiessel, IPA director for country needed to make sure the counterfactual important to find out what programs work programs, said impact evaluations “tell group matches what the treatment group and what do not. Doing impact evaluation us if we are on the right track and how would look like without the program,” she is crucial to assessing the effectiveness of we can improve.” Impact evaluation is explained. antipoverty or development interventions also necessary for accountability and for and determining whether such efforts taking stock of lessons learned. Kiessel noted that in Ghana, three should be scaled up or expanded. randomized evaluations found low-cost, “Instead of asking ‘Do development remedial education programs to have Effective ways of evaluating impact were programs work?’ we should be asking quick, positive impacts on literacy and discussed in a seminar hosted by PIDS ‘Which works best?’ and ‘How we can numeracy. and international nonprofit organization, scale up what works?’” said Kiessel. Innovations for Poverty Action (IPA) – Moreover, randomization helps ease Philippines, last Sept. 10 at the Romulo Kiessel stressed two important things. tension between treatment and control Hall of NEDA sa Makati Building, Impact evaluation should involve a groups. “If properly designed and as part of the observance of the 11th comparison between a treatment group conducted, randomized experiments are Development Policy Research Month. and a “counterfactual” or control group the most credible method to estimate to determine if there has been an impact. impact of a program,” Kiessel said. “The Nassreena Sampaco-Baddiri, IPA country Also, randomized experiments are more bottom line here is that the math that we director, said impact evaluation has effective in conducting evaluations. use does matter.” gained new importance amid questions “We need to make comparisons. If the over the government’s use of development counterfactual group can’t be observed, There are two interesting case studies in funds. we need to ‘mimic’ it…randomization is the Philippines: microcredit and savings programs. There is conflicting evidence on the impact of microfinance in the developing world, and the results are also mixed when it comes to the Philippines, said Mark Miller, deputy country director at IPA–Philippines.

In 2010, IPA partnered with First Macro Bank of Pateros for an evaluation of the latter’s credit program, using experimental credit scoring. One of the main findings was that after loan takeout, profits increased but only for male entrepreneurs, Miller said. “The effects of the loan were also stronger for higher-income entrepreneurs. These entrepreneurs had already started their business well, and they benefit more. But the loans did not Jessica Kiessel, director for country programs of Innovations for Poverty Action. serve well for starting businesses,” he (Photo: Jose Ignacio Tenorio) added.

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Miller noted that businesses that had obtained loans subsequently laid off employees. This meant these businesses Health department aiming had to shed workers to be able to grow.

Miller also discussed IPA’s study on for universal coverage commitment savings, a program that requires depositors not to withdraw THE DEPARTMENT of Health (DoH) is To address inequity in health service money from their accounts until their working to expand enrollment in the state- delivery, the DoH has deployed human saving goals are met. Results showed that owned Philippine Health Insurance Corp. health resources to “geographically the total amount saved by depositors (PhilHealth) as part of efforts to achieve disadvantaged areas” that often do not universal health care. have doctors. Around 21,400 nurses have increased by 82 percent. Female clients been deployed across poor areas of the also purchased 20 percent more durable The government aims to enroll 14.7 million Philippines. “I’d like to say that the rural items, such as refrigerators, from their families or around 58.8 million Filipinos health care units are the backbone of our savings. “More impatient clients are more with Philhealth by the end of the year to primary health care system. We estimate likely to commit to save. They realize their cover the so-called “near-poor” aside from to have birthing facilities at around 70 weaknesses and know they need help in the poorest layers of society, as part of percent of rural health units by next year, order to save,” Miller noted. the Aquino administration’s Kalusugan from 57.79 percent in 2010,” Ona bared. Pangkalahatan initiative, Health Secretary Enrique Ona said in the seminar-forum The budget of the Health Facility Meanwhile, monthly text messages sent titled “Sustainable and Inclusive Health Enhancement Program that seeks to to program participants as reminders Market Innovations: Challenges and upgrade rural health units has also of their savings commitments increased Opportunities for the Philippines”, held significantly increased, he added. savings by six percent. last Sept. 17 in observance of the 11th Development Policy Research Month For his part, Dale Huntington, director of PIDS President Gilberto Llanto said (DPRM). Ona’s keynote address was the Asia Pacific Observatory on Health impact evaluation is becoming important delivered by Health Undersecretary Systems and Policies, said the health Madeleine Valera. market is beset with imperfections, with researches needing more rigor. perverse incentives, and market failure. “It Impact evaluation is also needed now This year’s theme, “Making Health More is indeed a broken market. The solution that the government has decided to Inclusive in a Growing Economy”, puts to these problems is finding solutions incorporate performance measures in health in the spotlight, to highlight the through innovations,” he said. the budget process, he said in his closing pressing need to address inequality in remarks. PIDS and IPA have agreed to a health service delivery. Delivering the opening remarks on behalf partnership to disseminate the results of of PIDS president Gilberto Llanto, PIDS impact evaluations to policymakers and The Universal Health Care Program is Senior Research Fellow Aniceto Orbeta said anchored on three areas: (a) financial this year’s DPRM theme underscores that the public, Llanto said. risk protection through expansion in recent economic growth has not translated enrollment and benefit delivery of the to achieving inclusiveness and equity in IPA, established in 2002, ties up with National Health Insurance Program; (2) growth. researchers and organizations around the improved access to quality hospitals and world to study which social and economic health care facilities; and (3) attainment of “Moreover, rising population growth programs work and which don’t. IPA health–related Millennium Development continues to put pressures on existing has 14 country programs, including IPA Goals. resources. This is why the role of market Philippines, and more than 350 research innovation in addressing inequality Because of the uneven enrollment of the specifically in finding new technology projects completed or ongoing in over 40 “near poor”, only around 70 percent of will help us deliver health care better. countries across Africa, Latin America, families are able to access hospitals, Ona Health market innovations are critical in and Asia. said. At present, the DoH is cleaning up its improving the supply-side response to the data to ensure that the number of enrolled large-scale demand for adequate health IPA has been conducting research in the and the number of people covered by financing and service delivery,” he said. Philippines since 2003. FFS, CSM PhilHealth do match. CSM

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11th DPRM showcases health innovations

PROVIDING health care to poor Filipinos is an area fraught with problems, in particular huge costs. But there are local success stories with proven business models that can serve as good examples of health market innovation for the rest of the country.

The experiences of Leyte province in efficiently financing its hospitals and a government-owned medical center in Davao in maximizing resources and improving its facilities were showcased in the Sept. 17 seminar-forum titled “Sustainable and Inclusive Health Market Innovations: Challenges and Opportunities for the Philippines”, organized by the Philippine Institute for Energy Secretary Jericho Petilla (standing), former Leyte governor, highlights how Leyte was able to improve the province’s health delivery through proven business Development Studies, the WHO-Asia models. (Photo: Jose Ignacio Tenorio) Pacific Observatory on Health Systems and Policies, and the Center for Health Market Innovations as part of the 11th he said. “The bottomline is that training hospital under the Department Development Policy Research Month. sustainable programs depend on medical of Health, said improving process practitioners,” the Cabinet official said. flows resulted in the maximization of Carlos Jericho Petilla, the former Leyte PhilHealth benefits. governor who is now energy secretary, Another strategy was to partner with was able to improve the province’s health Mother Bles Birthing Clinics founded A drastic improvement in PhilHealth care delivery by incentivizing doctors and by a religious sister to improve maternal reimbursements allowed SPMC to health workers, maximizing collections care. This exerted a positive effect on increase PhilHealth admissions to more from the state-owned Philippine Health erstwhile underutilized rural health units, than 27,000 patients in 2012 from around Insurance Corp. or PhilHealth, and which “declogged” the hospitals of normal 22,000 the previous year. This also allowed raising revenues by charging fees to deliveries. the hospital to improve its facilities and patients who are willing to pay. embark on public-private partnership The solution lies on allowing patients to arrangements such as the consignment of Petilla said his province’s hospital maximize PhilHealth benefits by linking modern hospital equipment. incentive scheme provided for hospitals to an electronic database that maintenance and other operating eliminated the need for membership One of the discussants, Alex Raoul expenses, capital outlay, and employees’ cards. Local governments should focus Villano, assistant secretary-general of the share. This way, hospitals retained money on the supply-side of health care delivery, League of Provinces of the Philippines, to improve facilities and government and let PhilHealth take over the demand said the presentations of Petilla and doctors earned around PHP 250,000 side, Petilla argued. Vega were similar in that they employed monthly. The plantilla was filled up and working business models. “Hospitals government hospitals reduced the need Dr. Leopoldo Vega, chief of the Southern should be economic enterprises without to hire private doctors as consultants, Philippines Medical Center (SPMC), a sacrificing social responsibility,” he said.

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Health Undersecretary Madeleine Valera, LifeSpring has 12 hospitals in India year, he said. He added that through the who was also a discussant, noted that operating 24/7 for in-patient services and additional revenues from the sin taxes, these innovations worked to attain the 360 days for outpatient services. It has the government will be able to strengthen best care at a lower cost, but pointed facilitated the delivery of 20,000 infants, current programs or introduce new ones out that these ultimately depended on and provides examinations to 35,000 to make health more inclusive. PhilHealth resources. “Innovation can pregnant women annually. really distinguish between a true leader Soriano noted that the Philippines has and a follower,” she said. These best practices from India were world-class human capital plus financial lauded by the session discussants resources, but what is hindering the Health experts from India presented best composed of Dr. Teodoro Herbosa, country to foster a culture of innovation practices and technological innovations undersecretary of the Department of is the lack of “legitimacy capital” to that the Philippines can emulate to bridge Health; Josef Yap, former president of encourage innovators to come up with wide gaps in its health care system. the Philippine Institute for Development more creative ideas for the health market. Studies; and Dr. Elmer Soriano, director Yap, meanwhile, reiterated the importance Dipika Bedi, head of operations of of ACCESS Health Philippines. of replication and scaling up to make Teleradiology Solutions, shared her firm’s innovation successful. success story in teleradiology, an online Herbosa presented some innovations in system where diagnostic images are sent the Philippines through the Kalusugan Former health secretary Manuel electronically for remote interpretation. Pangkalahatan program of the Dayrit, who attended the forum, This system was founded on the rationale government, noting that approximately agreed and noted that thousands of of providing poor communities with easy 25 million people from the poorest health professionals are only waiting access to health care. “Delayed diagnostics communities have been given social to be tapped. “We’re No. 1 in exporting means delayed treatment,” Bedi pointed protection under this project. Funding nurses, No. 4 in exporting doctors. The out. will no longer be an issue with the health next innovation should be HR (human budget increased to PHP 87.5 billion next resources) innovation.” FFS, KCOO Teleradiology uses advancements in technology to fill the lack of radiologists worldwide. Results of X-ray scans and other medical examinations are available within 30 minutes to one hour. The system has been widely successful in the United States and has been adopted by Singapore. Teleradiology is now available in 20 countries around the globe, and the Indian firm seeks to make the service widely available in Africa.

Meanwhile, Vijaybhasker Mudiganti, head for process control of LifeSpring Hospitals, presented through videoconferencing a model for providing efficient maternal health and infant care. The hospital chain offers a viable, affordable, and accessible maternal health care scheme to poor communities without compromising quality. This was made Undersecretary Ted Herbosa of the Department of Health presents the innovations possible by capitalizing on low-cost or the government is now implementing through the Kalusugan Pangkalahatan program. “no-frills” strategies. (Photo: Gizelle Manuel)

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Study calls on gov’t to go into public-private investment partnerships in health

THE GOVERNMENT should deepen Public-Private Partnership (PPP) arrangements in the health sector if it wants to achieve universal health coverage.

Dr. Josephine Anne Lucero, research consultant at the Philippine Institute for Development Studies (PIDS), drew a distinction between the relatively short-term “Public-Private Interaction” (PPI) and a “Public-Private Investment Partnership” (PPIP) that lasts at least 10 years and yields system-wide efficiency gains. Nearly all local PPP deals are PPIs, Lucero said in her presentation during the Speakers underscore the importance of public-private partnerships as one of the key forum titled “Health Care For All: Issues measures in strengthening the country’s health systems. (Photo: Jose Ignacio Tenorio) and Challenges in Financing and Service Delivery in the Philippines” at the Romulo Hall of the NEDA sa Makati Building last In the hospital setting, it was found that with detailed action steps of accountable Sept. 24. it would be possible to maintain the institutions and agencies,” Lucero said. quality of hospitals while improving the “Health outcomes are the measure of efficiency and productivity of providers. PPP Center Executive Director Cosette health system’s performance, thus there is Information systems were deemed vital in Canilao, who served as a discussant, a need to strengthen our health systems,” the success of health systems integration. agreed that most health PPPs were only Lucero said during the forum, held as service agreements. The decision tree part of activities of the 11th Development If the government is keen on pursuing formulated by Lucero’s research team Policy Research Month. PPIPs as a way to achieve universal health will be useful for decisionmakers in care, it must lay down a framework determining whether to push for a PPIP The country should focus more on PPIPs that will guide and provide direction to or not, she said. as these types of arrangements address health PPPs. “There is a need for explicit the public policy objective of universal government direction on the role of The Department of Health has been health care, which seeks to ensure quality PPIPs,” said Lucero. capitalizing on PPPs, she added, citing the services, equity of access, and efficiency proposed modernization of Philippine gains at a neutral cost to patients. Moreover, policymakers should not lose Orthopedic Center. The project involves sight of the fact that PPIPs are means and the construction of a 700-bed hospital Six overseas case studies of PPIP options not ends. “PPIPs are tools for achieving with state-of-the-art infrastructure, in three settings—primary care, hospital, universal health coverage objectives modern medical diagnostics and clinical and integrated health care settings, were and these must be harmonized with the equipment, and information technology presented in the seminar. It was found general health sector objectives. They are facilities, to be operated and maintained that the more effective models of PPIPs not plans by themselves but actually part by the private sector proponent within a were those that were “contracted out”. of an integrated, long-term health plan period of 25 years. KCOO

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Inequalities in maternal, child care cited

IN THE PHILIPPINES, maternal and eggs daily that can stay alive in soil for up Many Filipino children are suffering child health services remain inequitable. to two years, he noted. from schistosomiasis. In Agusan del Sur, This was the gist of the seminar on Health for example, 5.2 percent of PSAC in day Care for All last Sept. 24 at the Romulo In the Philippines, 66 percent of pre- care centers are affected. The figure is Hall of NEDA sa Makati Building, in school age children (PSAC) and 67 32 percent among elementary and high celebration of the 11th Development percent of school-age children (SAC) school students. Policy Research Month. are suffering from worm infection. Because they have worms, many children The Philippines has failed to meet the “Trends with very high level of inequity experience growth stunting, weakness, 2010 target and deadline set by the World are seen in access to skilled birth as well as poor physical and cognitive Health Organization, which is 75 to 100 attendants and facility-based delivery, said development. Their school performance percent administration of chemotherapy Valerie Gilbert Ulep, research associate at and productivity are also impaired. “We to SAC with risk of morbidity because of the Philippine Institute for Development should not let worms win over people. worm infection. The Philippines reached Studies (PIDS) in his presentation “Are It is not acceptable. We should win only 11 percent coverage in 2011.The there improvements in the Delivery of over them for our children,” Belizario same target and deadlines were also set Maternal and Child Health Programs for emphasized. for schistosomiasis, which the country the Poorest in the Philippines?” was likewise unable to meet. Unlike before, the supply of deworming The Autonomous Region in Muslim tablets is no longer a problem. The tablets “In the end, these are developmental Mindanao (ARMM) has the highest level are safe, effective, candy-flavored, and issues. Infectious diseases are diseases of of inequity in maternal and child health chewable in one single dose. However, poverty and the marginalized. Healthy services. In the 2003-2008 National massive drug administration efforts have individuals are what the country needs Demographic and Health Survey, the little support and publicity. Parents have for growth and national development,” ARMM recorded significant increases not been fully cooperative. Belizario stressed. CSM in the level of inequality in access to and utilization of prenatal care, tetanus toxoid administration, Vitamin A supplies, skilled birth attendants, and full immunization.

Dr. Vicente Belizario, vice chancellor for research at University of the Philippines- Manila and executive director at the National Institutes of Health, highlighted the “not-so-popular” and neglected tropical diseases in the country. In particular, he cited soil-transmitted helminthiasis infections or worm infection and schistosomiasis as the predominant diseases of the poor in underdeveloped countries such as the Philippines. Ascaris is the major source of infection and causes the greatest Dr. Vicente Belizario, vice chancellor for research at UP Manila and executive director morbidity. A worm produces 10 million of the NIH. (Photo: Jose Ignacio Tenorio)

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Fill gaps in coverage, PhilHealth urged

THE GOVERNMENT has achieved she said. This can be done by earmarking universal coverage of the poor through a special health fund, both from the the Philippine Health Insurance Corp. national and local governments. (PhilHealth), but this may be uneven and there are wide disparities at the regional Dr. Silfverberg’s daughter, Denise and provincial levels. The same is true for Valerie, said problems in the mandatory PhilHealth’s “mandatory” program. PhilHealth program covering private sector and government workers needed These were the findings of separate studies to be addressed before expanding it. conducted by the mother-and-daughter The coverage rate in the private sector tandem of Raymunda and Denise Valerie is better than in the government sector, Silfverberg, research consultants of the while the individual paying program is Philippine Institute for Development lagging behind. Still, there are disparities Studies (PIDS), which were presented in in regional data, and one reason could be a forum last Sept. 24 as part of activities the prevalence of contractual employment for the 11th Development Policy Research contracts that do not have health benefits, Month (DPRM). Dr. Raymunda Silfverberg, PIDS research Ms. Silfverberg said. consultant. (Photo: Jose Ignacio Tenorio) This year’s DPRM celebration zeroes in Discussant Dr. Joseph Capuno of the UP on inequalities in health service delivery, distribution was skewed toward mild to School of Economics said the government with the theme “Making Health More extreme “leakage”. could be over-enrolling in some areas to Inclusive in a Growing Economy”. make up for under-enrollment in other Data showed less than 50 percent areas. PhilHealth’s Sponsored Program (SP), said or severe undercoverage in Siquijor, Dr. Raymunda Silfverberg, had attained Zambales, Tarlac, and parts of Quezon For her part, Dr. Maria Eufemia Yap universal coverage in 2011. Intended City; and “outlying leakage” in places of the Ateneo School of Medicine and beneficiaries of the program for indigents like Guimaras, Isabela City, Sulu, Public Health said health maintenance are those in the “poorest of the poor” or Maguindanao, and Zamboanga Sibugay, organizations, for which PhilHealth is the the lowest 25 percent of the population, which had coverage rates of 430.69 “first peso payer”, might want to rethink but this was later expanded to cover the percent to 4,508.92 percent. the way they do business with given the “near poor”. goal of universal health coverage. Dr. Silfverberg also found indicators of a Benefits include hospitalization, special “substitution effect” in which members But while health insurance is a “numbers packages, and outpatient benefit packages. shift to the indigent scheme from the game”, there will still be people in the Premiums are covered by the national regular scheme and vice versa, which informal sector who will require some government through PhilHealth, could be due to the practice of politicians form of safety net, she said. local governments, nongovernment handing out PhilHealth cards during organizations, private individuals and election years. PIDS President Gilberto Llanto said all corporations, and Priority Development this underscored the importance of policy Assistance Funds of lawmakers. “Analyses underscore the important role research in decisionmaking. “Policy of local government units as partner research gives the biggest bang out of a Dr. Silfverberg described as implementers of SP – as provider of health small buck,” he told participants. Llanto “disconcerting” the uneven coverage and services (primary and lower-level hospital also pointed out that “Development is wide disparities in coverage rates at the care) and financier of [PhilHealth] human development, and if it is to matter regional and provincial levels, noting that premiums and health services rendered,” at all, it should be inclusive.” FFS

10 Development Research News October – December 2013

Senate forum emphasizes need to enhance conditional cash transfer program

Expanding the Pantawid Pamilyang beneficiary. Only a maximum of three In an earlier CCT forum organized Pilipino Program or 4Ps—the children per family shall receive the by PIDS in July, Secretary Corazon government’s conditional cash transfer education grant. “Dinky” Soliman of the Department (CCT) program—should be accompanied of Social Welfare and Development by modifications in its design and The President cited in his State of the (DSWD) confirmed the extension of implementation to make it more effective Nation Address what Reyes took note in the program’s coverage to children up to and efficient. many of her presentations that the average 18 years old to give them the chance to daily wage of high school graduates is 45 finish high school. Each 4Ps high school Poverty specialist and PIDS Senior percent higher than those who only had student, she said, will receive PHP 500. Research Fellow Celia Reyes emphasized some elementary education. The PIDS Whether or not DWSD will follow Reyes’ this again in a seminar-forum titled team also showed results that the school recommendation of differentiating the “Pantawid Pamilyang Pilipino Program: attendance of children of 4Ps families amount of the cash grant by gender still Why “deepening” matters in achieving its steadily declines among older children. remains to be seen. human capital objectives” held on Sept. 19 This has not been the case with younger at the Senate of the Philippines. Organized children. School attendance falls below 90 There is a need for a clear exit strategy, by the Philippine Institute for Development percent after age 13 based on their analysis. Reyes also noted. The program should be Studies (PIDS) and the Senate Economic More boys than girls also attend school, concerned with what will happen to the Planning Office (SEPO), the forum was and even among older children, boys have beneficiaries after they ceased being part intended to apprise Senate technical staff lower school participation than girls. of the 4Ps. For the beneficiary children, of the major findings of PIDS’ initial the goal should be to ensure that they can evaluation of the CCT program to assist “There is a public elementary school in continue up to college or earn a vocational them in providing effective technical almost every barangay so access is not degree. Some technical staff in the support to legislators. The forum was part a problem among younger children. audience commented that the 4Ps should of the celebration of the 11th Development High schools are typically located in be harmonized with other programs— Policy Research Month which is also the poblacion, which means higher cost such as the tertiary scholarships and spearheaded by state think tank PIDS. of education for families given higher vocational programs—being implemented transportation cost and school fees. by other government agencies. The Aquino II administration picked As to the gender disparity in school up the recommendation of Reyes and participation, we can attribute this to the The significance of clear objective-setting her research team at PIDS to extend the fact that older male children would often was emphasized by PIDS President period of assistance being given to CCT drop out of school to help their families. Gilberto Llanto. “The program has a beneficiaries to enable their children to The cash grant for male CCT children strong potential to make economic growth finish high school. The original design of should thus be higher to encourage them more inclusive in the Philippines, but we the 4Ps, when it started implementation to stay in school,” Reyes explained. have to be clear about our objective and in 2008, was to provide assistance to pair it with a good intervention…sustain it identified poor households to enable Most 4Ps families cited “lack of personal over time, and correct the flaws, otherwise, their 6- to 14-year-old children to interest” as the reason for the inability of it will be reduced to a very costly and finish elementary. The assistance is for their 6- to 14-year-old children to sustain ineffective instrument. Government is a maximum of five years and amounts school attendance. Reyes said this requires saying we have to converge, coordinate each year to PHP 3,000 per child for the more probing. If the reasons behind are our efforts. Maybe it is not about inventing education component and PHP 6,000 for clear, better intervention can be developed new programs but deepening, improving the health component for each family to address it, she said. present ones,” Llanto said. SVS

11 Development Research News October – December 2013

‘Broad reform coalition’ needed to deal with enormous jobs challenge

THE PHILIPPINES needs to create 14.6 25 percent since the 1960s, while other million jobs in the next four years, and the countries steadily increased theirs before way to do this is by keeping the country moving on to growth driven by high-skill on a sustained path of economic growth. services. This will be possible through a “broad reform coalition” that will work to make PIDS Acting Vice-President Rafaelita growth inclusive and support policies that Aldaba called for a comprehensive will generate more and better jobs. industry roadmap that will link all sectors, including agriculture and services. “We This was stressed by experts from the need to improve the competitiveness of World Bank (WB) and the Philippine industries,” she said, adding that effective Institute for Development Studies (PIDS) government policies and complementary as they dialogued with stakeholders in the actions such as competitive exchange labor and business sectors as well as the rates would also be needed. Structural academe last Sept. 13. transformation would require rebuilding capacity, a shift to high value-added “People want to earn a living, they activities, and deeper participation in World Bank Senior Country Economist Karl don’t want handouts,” said Axel von regional production networks. Kendrick Chua. (Photo: Gizelle Manuel) Trotsenburg, WB vice-president for East Asia and Pacific Region, as he opened the Creating More and Better Jobs”, which Needed reforms include secure property “Dialogue on Creating More and Better provides an in-depth discussion of the ownership; fair competition; more Jobs” at One Global Place in Bonifacio country’s jobs challenge. investments in health, education, and Global City. The forum was organized by infrastructure; and simple business World Bank Philippines and PIDS as part With an estimated 1.15 million Filipinos regulations to decrease the cost of doing of the activities for the 11th Development entering the labor force every year in the business in the Philippines. Businesses Policy Research Month. next four years, a total of 14.6 million jobs need to embrace the principle of a level would be needed, he said. playing field and recognize freedom Job creation is a real concern as it has a of association, while labor needs to direct link to poverty, and considering The problem is that the Philippine recognize valid flexible contracts and that four billion people around the world economy has failed to undergo a reduce calls for minimum wage hike as live on less than USD4.00 a day, he said. structural transformation, and its food prices fall to facilitate job creation, inability to produce a massive number Chua said. Karl Kendrick Chua, WB senior country of jobs is due to a long history of “policy economist, said transforming the distortions”. Chua pointed to the country’s A broad coalition would be needed to Philippine economy to yield more and historically weak economic growth tackle these issues, the WB economist better jobs would be the challenge for record, which, at an average of just 4.1 said. “Instead of tackling policy reforms everyone. “More and better jobs should be percent in the last three decades, was one by one, the government, business, and created for 10 million Filipinos who were considerably slower than the average 6.5 labor, with the support of civil society, either unemployed or underemployed percent of its more dynamic East Asian need to work together to come up with a as of 2012,” said Chua as he presented peers over the same period. Moreover, package of reforms in creating more and highlights of a draft report titled the share of manufacturing to gross better jobs in the Philippines,” Chua said. “Philippine Development Report (PDR): domestic product has stagnated at around FFS, PMGV

12 Development Research News October – December 2013

Research Digests

Discussion Paper No. 2013-51 energy products, market adjustments, and natural disasters on household income Regional Comprehensive Economic regulatory reforms. using 2011 CBMS data for Pasay City, Metro Partnership: Reform Challenges and Key Manila. It summarizes some of the results Tasks for the Philippines Discussion Paper No. 2013-48 and findings of a recent study conducted by by Gilberto M. Llanto and Ma. Kristina P. Ortiz Customs Brokerage Services and Trade PIDS and funded by the Economic Research The ASEAN+6 countries are currently Facilitation: A Review of Regulatory Institute for ASEAN and East Asia. engaged in negotiation for a Regional Coherence Comprehensive Economic Partnership by Gilberto M. Llanto, Adoracion M. Navarro, Policy Notes No. 2013-13 (RCEP). The paper discusses some of the Keith C. Detros, and Ma. Kristina P. Ortiz Border and Behind-the-Border challenges facing the Philippines during The study looks at the rarely studied Restrictions in Logistics and Trade the difficult period of negotiation and customs brokerage activity in the Facilitation in the Philippines: Some the necessary structural and institutional Philippines and its role in facilitating trade Results of Regulatory Dialogues reforms that it has to take to ensure that it given the ongoing push to modernize by Gilberto M. Llanto, Adoracion M. Navarro, will benefit from RCEP. customs administration. It analyzes how Keith C. Detros, and Ma. Kristina P. Ortiz the customs brokerage profession is The Philippines’ potential to capitalize on Discussion Paper No. 2013-50 being regulated and synthesizes insights the gains of regional economic integration Energy Market Integration and Energy on opposing views on the importance of depends on its resolve to address the Poverty in ASEAN customs brokers in trade facilitation. reform gaps and challenges that undermine by Adoracion M. Navarro, Maxensius Tri the efficient and effective regulation Sambodo, and Jessie L. Todoc Policy Notes No. 2013-15 and management of trade facilitation at This study maps the energy poverty Export Processing Zones, Special the border and behind the border. This situation in the region, and reviews the Economic Zones: Do We Really Need to Policy Note summarizes the findings of links between energy access and economic Have More of Them? the Philippine research team in a study and human development. It also draws a by Rosario G. Manasan funded by the Economic Research Institute connection between ASEAN Energy Market Export processing zones (EPZs) are for ASEAN and East Asia that probed the Integration (AEMI) and the eradication considered an important economic regulatory environment and the remaining of energy poverty, or attaining universal strategy to boost export promotion, attract border and behind-the-border restrictions energy access, in terms of benefits and foreign direct investments, and create in logistics and trade facilitation in the strategies, particularly with regard to employment opportunities for the domestic region. mapping investment requirements workforce. With our more than 40 years and taking inventory of financing of experience in managing ecozones, it is Policy Notes No. 2013-12 options. The study concludes with some but fitting to know if these ecozones have Key Reforms for an Effective Regional recommendations for near-term actions. been successful in facilitating economic Comprehensive Economic Partnership development for the Philippines. This Policy by Gilberto M. Llanto and Ma. Kristina P. Ortiz Discussion Paper No. 2013-49 Note briefly reviews the performance of The Association of Southeast Asian The Pathway to ASEAN Energy Market EPZs and special economic zones (SEZs). It Nations (ASEAN) is looking at Regional Integration also provides some guidance in evaluating Comprehensive Economic Partnership by Adoracion M. Navarro and Maxensius Tri ecozone proposals by drawing on the (RCEP), a region-wide free trade agreement, Sambodo lessons learned from our experience in SEZs as an important step toward a deeper Global experience in regional energy and that of other countries to ensure the and integrated production base in the market integration presents broad elements success of future ecozones. region that is also open to the rest of the of integration, i.e., binding agreements, world. If successfully negotiated, RCEP physical infrastructure, standardized Policy Notes No. 2013-14 can be the world’s biggest trading bloc or harmonized rules of operation, and The Impact of Natural Disasters on covering at least 40 percent of world governing or coordinating institutions. The Income and Poverty: Framework trade and offering significant benefits to pathway to AEMI will also involve creating and some Evidence from Philippine participating countries. This Policy Note these elements; however, this activity must Households points out key reform challenges facing be preceded by trust-building activities by Danilo C. Israel and Roehlano M. Briones the Philippines during the difficult period among ASEAN members. Trust should be This Policy Note provides a framework for of negotiation and the necessary structural built by candidly disclosing mutual gains analyzing the impact of natural disasters on and institutional reforms that must be taken from, and shared costs and externalities household income and household poverty to ensure that the country will benefit from in energy resource development, trading and empirically estimates the effects of the RCEP.

13 Development Research News October – December 2013

‘Inclusive growth must be asserted in AEC’

The inclusive growth mantra has to be further asserted in the ASEAN Economic Community (AEC), said Cielito Habito, former director-general of the National Economic and Development Authority (NEDA) and chief of party of the USAID Trade Related Assistance for Development, during the Final Workshop of “ASEAN Beyond 2015”, a project of the Economic Research Institute for ASEAN and East Asia (ERIA). State think tank Philippine Institute for Development Studies (PIDS) co-organized the event held at the Carlos P. Romulo Hall, NEDA sa Makati Building last November 26. Cielito Habito (left), former NEDA director-general, and UP Professor Emeritus Gerardo According to Habito, ASEAN trade Sicat (right). (Photo: Gizelle Manuel) relations must be competitive rather than complementary. “The Philippines has of governance and political issues on resources in the Philippine manufacturing a predominantly intra-industry trade the country’s investment performance. sector. Its share of value added to gross with the rest of the ASEAN countries, Changes of government have caused domestic product declined to 23.7 percent especially with its major trading partners reversals of economic policies and the in the 2000s from 26.3 percent in the in the region, meaning we trade in effects of these reversals have been very 1980s,” she said. products within the same industries. costly, Sicat said. The Philippines’ top exports to its major ERIA Senior Researcher Ponciano Intal ASEAN trading partners are petroleum Sicat said the Philippines was the only said ASEAN competitiveness must be products, electronics, and chemicals, country in the ASEAN with complex strengthened to sustain high and equitable the same products that we import in the constitutional provisions on economic growth beyond 2015. The Philippines region,” Habito said. issues. “We have restrictions on capital, needs an enabling policy and regulatory land ownership, public utilities, and environment to meet the desired targets of Habito also noted the budget misallocation operation of land mineral resources, which eliminating dire poverty, reducing poverty in the agricultural sector, where 70 percent not all foreign investors could deal with,” rates by at least two-thirds, and reducing of the commodity budget goes to rice yet it he said. the youth illiteracy rate and malnutrition. is responsible for only about 16 percent of “There should be greater focus on food the value adding in agriculture. PIDS Senior Research Fellow and Acting security as it remains to be a significant Vice-President Rafaelita Aldaba stressed concern in the ASEAN,” Intal, a former He pointed to the growth potentials of the that the Philippines should not rely PIDS president, said. services sector. “The Philippines has much on the services sector alone if it wants more growth in the services sector because economic growth to be inclusive. Aldaba PIDS President Gilberto Llanto stressed there are lots of value adding within this noted the urgent need for the revival of the need for ASEAN countries to focus on sector, such as in design and software.” the manufacturing sector to increase the border and beyond-the-border issues. “We country’s competitiveness in the region. also need to cascade the implications of Meanwhile, UP professor emeritus and A more vibrant manufacturing sector also AEC 2015 to our policymakers, especially the first NEDA director-general, Gerardo means more jobs available for Filipinos. to those who still are not aware of what Sicat, highlighted the negative impacts “There has been very little movement of AEC 2015 is.” PMGV

14 Development Research News October – December 2013

PIDS, DFA tie up for APEC 2015 research project

THE PHILIPPINE Institute for Development Studies (PIDS) signed a memorandum of agreement with the Department of Foreign Affairs (DFA) for the APEC 2015 Research Project last Nov. 14 at the Carlos P. Romulo Hall, NEDA sa Makati.

PIDS President Gilberto Llanto and DFA Undersecretary for Administration Rafael Seguis signed for PIDS and DFA, respectively.

Under the agreement, DFA will lead in the conduct of the project that will provide the requisite analytical framework for determining the substantive priorities the Philippines will push for as APEC Host PIDS President Gilberto Llanto and DFA Undersecretary Rafael Seguis seals the Economy in 2015. Meanwhile, PIDS will agreement for the APEC 2015 Research Project. (Photo: Gizelle Manuel) provide technical expertise in the conduct of the project. country will chair the conference since regional cooperation with other APEC its first hosting in 1996. The DFA-PIDS member-economies, and provide inputs The 2015 APEC Conference in the research project will serve APEC’s to development planning of the Philippine Philippines is the second time that the purpose of maximizing the benefits of government. PH ‘behind’ ASEAN neighbors in infra quality

Quality of infrastructure in the that placed 119th, the ASEAN nation infrastructure was spent, a scenario that Philippines is second to the last in ASEAN. with the poorest quality of infrastructure. has not changed since 2010. The decreasing This was disclosed by Adoracion Navarro, Ranked first in the region was Singapore, reliance on official development assistance senior research fellow of the Philippine which placed second overall among 144 (ODA) loans also contributed to the low Institute for Development Studies countries. Malaysia was ranked 29th; quality of infrastructure, she said. In 2012, (PIDS), during the forum “Financing Brunei Darussalam, 43th; Thailand, 49th; ODA loans for infrastructure stood at Infrastructure in the Philippines” last Oct. Cambodia, 72th; and Indonesia; 92th. around US$5 million, smaller than the 24. The Philippines got the lowest rank in 2008 figure of more than US$6 million. quality of port infrastructure (120th) and In the Global Competitiveness Report air transport infrastructure (112th). This Navarro challenged stakeholders in the 2012-2013 of the World Economic Forum, was worse than Cambodia’s 69th and financial sector to take advantage of the Philippines ranked 98th among 144 75th ranking in port and air transport the liquid financial market given huge countries in terms of quality of overall infrastructure, respectively. project costs. The government should also infrastructure. Philippine infrastructure organize a group of experts to formulate is worse than Cambodia’s, Navarro said. Navarro attributed this poor showing to clear mechanisms and an institutional In the ASEAN region, the only country underinvestment in infrastructure. In setup to mobilize bank resources for the Philippines overtook was Viet Nam 2012, only 11 percent of the budget for infrastructure financing, she said. PMGV

15 Development Research News October – December 2013

Editor’s. . . from p. 1

This edition of the DRN chronicles child care, and public-private partnership Saliksikan on Financing Infrastructure in the the proceedings of the nationwide arrangements in health. Philippines, the fourth and final workshop commemoration of the 11th Development of the ASEAN Beyond 2015 Project, and the Policy Research Month (DPRM) last As part of the 11th DPRM, the Institute and signing of a memorandum of agreement September. With the theme “Making health the World Bank Philippine office held the between the Institute and the Department more inclusive in a growing economy”, the “Dialogue on Creating More and Better Jobs” of Foreign Affairs for a research project on DPRM events highlighted for policies that will in a bid to assemble a “broad reform coalition” the country’s APEC 2015 hosting. make health more inclusive. The Philippines that will work to make growth inclusive and needs to hike its health expenditures to the support policies that will generate more and The year 2013 was marked by successive minimum five percent recommended by the better jobs. Another forum at the Senate tragedies in the Visayas—a massive World Health Organization, from the current highlighted the need for improvements in earthquake and the onslaught of super- 3 to 3.5 percent. the Pantawid Pamilyang Pilipino Program typhoon “Yolanda”. These natural disasters to make it more effective and efficient. The also serve to remind policymakers and Other DPRM-related articles feature DPRM was officially concluded by the forum researchers of the need for evidence-based effective tools for evaluation of the impact titled “Towards Universal SHI Coverage in policy that are relevant to the poor and of antipoverty and development projects, the Philippines: Setting the Subsidies Right vulnerable, especially in terms of health, best practices in health financing and for the Informal Sector” at the UP School of education, and jobs. Social protection innovations, the government’s Universal Economics last Sept. 27. policies have an important role to play as Health Care program being implemented the country embarks on a recovery and under the Philippine Health Insurance This issue also features PIDS events in rebuilding process. Corp., inequalities in maternal health and the fourth quarter, such as the Pulong

The Staff DEVELOPMENT RESEARCH NEWS DEVELOPMENT RESEARCH NEWS is a quarterly publication of Vol. XXXI No. 4 the PHILIPPINE INSTITUTE FOR DEVELOPMENT STUDIES (PIDS). It Editorial Board: Dr. Gilberto M. Oct - Dec 2013 highlights the findings and recommendations of PIDS research Llanto, President; Dr. Rafaelita M. ISSN 0115-9097 Aldaba, Vice-President; Renee Ann projects and important policy issues discussed during PIDS seminars. Jolina C. Ajayi, Officer-in-Charge for PIDS is a nonstock, nonprofit government research institution Project Services & Development; Dr. engaged in long-term, policy-oriented research. This publication is part of the Institute's program to Sheila V. Siar, Director for Research disseminate information to promote the use of research findings. The views and opinions expressed here Information; Ms. Andrea S. Agcaoili, are those of the authors and do not necessarily reflect those of the Institute. Inquiries regarding any of Director for Operations & Finance; Atty. the studies contained in this publication, or any of the PIDS papers, as well as suggestions or comments Roque A. Sorioso, Legal Consultant. are welcome. Please address all correspondence and inquiries to:

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