MANILA The privatization of public hospitals has been going on since the regime of the late president Ferdinand

d Marcos. The different administrations had different names for it: publicprivate partnerships, corporatization, users service fee schemes, revenue enhancement programs, outsourcing or outright sale. Health groups said privatization has been the framework of almost all health policies and programs of the various administrations since Marcos. According to the Network Opposed to Privatization, Marcos laid the legal framework for the privatization of government hospitals through Presidential Decree 2029 and 2080, which and legalized the sale of Welfareville Property where the National Center for Mental Health stands through the Republic Act 5260. The late president Corazon Aquino, on the other hand, prepared the organizational mechanism for privatization by setting up the Committee on Privatization and the Asset Privatization Trust. The Build-Operate and Transfer Law was also enacted during her term, which allowed the private sector to access official development aid for privatization projects. Privatization as a national government program and policy intensified under the administration of Fidel Ramos after his administration moved vigorously to privatize public health care services. The Philippine Heart Center, Lung Center of the Philippines, National Kidney and Transplant Institute and Philippine Childrens Medical Center became government-owned and controlled corporations from its previous categorization as public hospitals and are now earning profits through its expensive health services thus depriving indigent patients of accessible and affordable health care. Deposed president Joseph Estrada, on the other hand, implemented the Health Sector Reform Agenda and Executive Order 102 that transformed the functions of the Department of Health (DOH) from a direct service provider to a mere regulator and monitor of services. According to the NOP, the said EO resulted in massive lay offs of DOH employees and dissolution of health programs such as the Malaria and Leprosy Control. Administrative Order No. 181 series of 2001 was also passed, which proposed to corporatize 38 public hospitals. Separate legislations were also filed to corporatize Quirino Memorial Medical Center, Ilocos Training and Regional Medical Center and Western Visayas Medical Center. During former president Gloria Macapagal-Arroyos term, corporatization was the buzzword for privatization. It also pushed for corporatization of 68 public hospitals under the DOH. President Benigno S. Aquino IIIs Universal Health Care Program is no different from the previous governments health policy. It is a continuation of the International Monetary FundWorld Bank recipes of Health Sector Agenda and the FourMula One for Health. The Universal Health Care program boasts of the Public-Private Partnership Program and the Philippine Health Insurance Program as its two main pillars, Robert Mendoza, secretary general of Alliance of Health Workers, said. Health groups said Aquino has surpassed its predecessor in its aggressiveness to privatize government hospitals and public health care services under its euphemistic slogan of Universal Health Care for All. Mendoza cited the fast tracking of House Bill 6069 or An Act Creating National Government Hospital Corporations filed by Bacolod Rep. Anthony Rolando Golez, Jr., which has been passed by the Committee on Health in the House of Representatives last May 16. The bill proposed to corporatize 26 DOH retained hospitals; among these public hospitals are San Lazaro Hospital, Jose R. Reyes Memorial Medical Center, Veterans Regional Hospital, Baguio General Hospital and Medical Center, Zamboanga City Medical Center among many others. In the Senate, Sen. Franklin Drilon filed Senate Bill 3130 or the National Government Hospital Corporate Restructuring Act, which also has the same content as HB 6069. These are all strongly opposed by progressive groups. Aquino also placed the Philippine Orthopedic Center, San Lazaro Hospital, Research Institute for Tropical Medicine, the Eversley Child Sanitariam in Metro Cebu and 21 more regional hospitals under PPP projects for modernization and improving of health facilities and services with the promised return in investment in revenue sharing, lease fees per treatment with diagnostic equipment. The Aquino government is reneging on its responsibility to adequately provide for public hospitals by reducing subsidy and corporatizing public hospitals. Corporatization of public hospitals is privatization by another name. This will increase the cost of health services and further aggravate the present dismal plight of our poor patients and health workers, Mendoza said. An anti-poor reform agenda for health sector The Supreme Court, in a 23-page en banc decision penned by Associate Justice Minita Chico Nazario, upheld the constitutionality of the privatization program under the Health Sector Reform Agenda (HSRA) for 1999-2004 and President Joseph Estrada?s Executive Order No. 102 (May 24, 1999). The Hospital Workers Group, Kilusang Mayo Uno, Gabriela, Kilusang Magbubukid ng Pilipinas, Kalipunan ng Damayan ng mga Maralita and the employees of the Department of Health alleged in their petitions that the HSRA would be detrimental to the health of the people who would be denied access to free medicine once government hospitals are privatized. (Inquirer, 7/21/07) Therefore, the HSRA is anti-poor. Edsa People Power I was wrong in driving out President Marcos from Malacaang on Feb. 26, 1986. During the incumbency of Marcos, hospitals were built: the Lung Center, Heart Center, National Kidney and Transplant Institute, National Children?s Hospital, Bagong Lipunan Hospital (now East Avenue Medical Center) and others. The Supreme Court has given its nod to the privatization of state-owned hospitals and health facilities under the Health Sector Reform Agenda, saying reforms in the health sector is a valid exercise of the Presidents constitutional power.

In a 23-page decision penned by Associate Justice Minita Chico-Nazario, the SC affirmed the constitutionality of the Health Sector Reform Agenda (HSRA) for 1999-2001 of the Department of Health and Executive Order No. 102 issued by former President Joseph Estrada on May 24, 1999, which paved the way for the privatization of various government hospitals. In issuing its decision, the High Court upheld the November 2004 decision of the Court of Appeals which denied the petition filed by the workers of the Tondo Medical Center, Research Institute for Tropical Medicine, National Orthopedic Hospital, Dr. Jose R. Reyes Memorial Hospital, San Lazaro Hospital, and by non-government organizations Alliance of Health Workers Inc., Health Alliance for Democracy, Council for Health Development, Network Opposed to Privatization, Community Medicine Development Foundation Inc., Philippine Society of Sanitary Engineers Inc., Kilusang Mayo Uno, Gabriela, Kilusang Magbubukid ng Pilipinas, and Kalipunan ng Damayan ng mga Maralita. The private petitioners in the case were Elsa Guevarra, Arcadio Gonzales, Jose Galang, Domingo Manay, Tito Esteves, Eduardo Galope, Remedios Ysmael, Alfredo Bacunata, Edgardo Damicog, Remedios Maltu and Remegio Mercado, all DOH employees. Citing Section 17, Article VII of the Constitution, the SC said the Constitution sanctioned the Presidents authority, by executive or administrative order, to direct the reorganization of government entities under the executive department, including the DOH. To remain effective and efficient, it must be capable of being shaped and reshaped by the President in the manner the Chief Executive deems fit to carry out presidential directives and policies, the SC ruled. The High Court said the issuance of EO 102 is well within the constitutional power of the President and there was no usurpation of any legislative prerogative in issuing EO 102, and that the actions of the DOH secretary, being an alter-ego of the President, are also presumed to be acts of the President. The SC further said petitioners had failed to prove that the HSRA supposedly violated the equal protection and due process clauses that are embodied in Section 1 of Article III. None of the private petitioners were removed from public service, the Court added, nor could they cite actions that would show the reorganization was pursued in bad faith or resulted in actual injury to petitioners. The Supreme Court upheld on Tuesday a policy of privatizing government hospitals instituted during the Estrada administration. In a 23-page ruling penned by Associate Justice Minita Chico-Nazario, the High Tribunal affirmed the constitutionality of the Health Sector Reform Agenda (HSRA) for 1999 2001 provided under Executive Order No. 102. The policy allows the privatization of government-owned hospitals and health facilities. The Supreme Court acknowledged that instituting reforms in the Department of Health is a valid exercise of the President's power. Then President Joseph Estrada issued EO 102 on May 24, 1999. In November 2004, the Court of Appeals denied a petition of health workers in public hospitals such as the Tondo Medical Center, Research Institute for Tropical Medicine (RITM), National Orthopedic Hospital, Dr. Jose R. Reyes Memorial Hospital, and San Lazaro Hospital as well as non-government organizations like the Alliance of Health Workers Inc., Health Alliance for Democracy, Council for Health Development, Network Opposed to Privatization, Community Medicine Development Foundation Inc., Philippine Society of Sanitary Engineers Inc., Kilusang Mayo Uno, Gabriela, Kilusang Magbubukid ng Pilipinas, and Kalipunan ng Damayan ng mga Maralita questioning the validity and constitutionality of the presidential edict. Health employees Elsa Guevarra, Arcadio Gonzales, Jose Galang, Domingo Manay, Tito Esteves, Eduardo Galope, Remedios Ysmael, Alfredo Bacunata, Edgardo Damicog, Remedios Maltu and Remegio Mercado joined in the petition in their private capacity. Citing Section 17, Article VII of the Constitution, the SC said the Constitution sanctioned President's authority, by executive or administrative order, to direct the reorganization of government entities under the executive department, including the DOH, which is directly under the supervision and control of the Office of the President. "To remain effective and efficient, it must be capable of being shaped and reshaped by the President in the manner the Chief Executive deems fit to carry out presidential directives and policies," the SC ruled. According to the Supreme Court, the issuance of EO 102 is well within the constitutional power of the President to issue and that he did not usurp any legislative prerogative. It emphasized that in issuing EO 102, the actions of the DOH secretary, being an alter-ego of the President, are also presumed to be acts of the President. "It is an exercise of the President's constitutional power of control over the executive department, supported by the provisions of the Administrative Code, recognized by other statutes and consistently affirmed by this Court," the Court said. The SC further said petitioners failed to prove that the HSRA supposedly violated the equal protection and due process clauses that are embodied in Section 1 of Article III. None of the private petitioners were removed from public service, the Court added, nor could they cite actions that would show the reorganization was pursued in bad faith or resulted in actual injury to petitioners. "Since they failed to substantiate how these constitutional guarantees were breached, petitioners are unsuccessful in establishing the relevance of this provision to the petition, and consequently in annulling the HSRA," said the SC. Court records showed that in May 1999, Estrada issued EO 102, which provided for the changes in the roles, functions and organizational processes of the DOH, in which the health agency will refocus its mandate from being the sole provider of health services to being a provider of specific health services and technical assistance. Under the EO, the DOH will be streamlined while health personnel will be deployed to regional offices and hospitals, as a result of the devolution to local government units of basic

services and facilities, as well as specific health-related functions. On the other hand, HSRA provides for fiscal autonomy of government hospitals, particularly the collection of socialized user fees and the corporate restructuring of government hospitals. Petitioners questioned the implementation of the Rationalization and Streamlining Plan (RSP) and the issuance of Administrative Order 172 issued by the DOH on January 2001 entitled "Policies and Guidelines on the Private Practice of Medical and Paramedical Professionals in Government Health Facilities," for imposing an added burden to indigent Filipinos, who cannot afford to pay for medicine and medical services. They alleged the implementation of these reforms had resulted in making free medicine and free medical services inaccessible to economically disadvantaged Filipinos. Prior to the decision of the CA, petitioners filed a petition for certiorari before the high court on August 2001, but it referred the petition to the appellate court for appropriate action. Named respondents in the suit were former Executive Secretary Alberto Romulo, Health Secretary Manuel Dayrit, and Budget Secretary Emilia Boncodin. Associate Justice Antonio Eduardo Nachura inhibited from the case, having signed pleadings as solicitor general. - GMANews.TV

MANILA, Philippines The President of the Philippines and the Department of Health are authorized, under the Constitution, to reorganize state-owned hospitals and medical facilities so that they will be more effective and efficient in performing their duties, according to the Supreme Court. The ruling stemmed from a petition by government hospital workers and non-government organizations that asked the high court to declare as unconstitutional the Health Sector Reform Agenda (HSRA) for 1999-2001 of the Department of Health (DoH) and Executive Order No. 102 issued by former president Joseph Estrada. Workers from the Tondo Medical Center, Research Institute for Tropical Medicine, National Orthopedic Hospital, Dr. Jose R. Reyes Memorial Hospital, San Lazaro Hospital; NGOs such as the Alliance of Health Workers, Inc., Health Alliance for Democracy, Council for Health Development, Network Opposed to Privatization, Community Medicine Development Foundation Inc., Philippine Society of Sanitary Engineers Inc., Kilusang Mayo Uno, Gabriela, Kilusang Magbubukid ng Pilipinas and Kalipunan ng Damayan ng mga Maralita; and several private petitioners who are employees of the DoH have claimed that a reorganization scheme as provided under HSRA and EO 102 violated due process and the equal protection clause of the Constitution. Respondents in the case were former executive secretary now Foreign Affairs Secretary Alberto Romulo, former health secretary Manuel Dayrit, and former budget secretary Emilia Boncodin. But in a 23-page en banc decision, through Associate Justice Minita Chico-Nazario, the high court upheld the constitutionality of the HSRA and EO 102. The HSRA gives the DoH the mandate to restructure the management of selected government hospitals; secure funding for priority public health programs; promote the development of local health systems and ensure their effective performance; strengthen the capacity of health regulatory agencies and expand the coverage of the National Health Insurance Program (NHIP). The high court agreed with the November, 2004 decision of the Court of Appeals that denied the appeal of the petitioners against the HSRA and the EO 102. To remain effective and efficient, it must be capable of being shaped and reshaped by the President in the manner the Chief Executive deems fit to carry out presidential directives and policies, the high court said. It cited Section 17, Article 7 of the Constitution which allows the President, through an executive or administrative order, to direct the reorganization of government entities under the executive department, including the DoH. At the same time, EO 102 is legal and that the DoH Secretary, being the alter-ego of the President, can act in behalf of the Chief Executive, the high court said. It is an exercise of the Presidents constitutional power of control over the executive department, supported by the provisions of the Administrative Code, recognized by other statutes and consistently affirmed by this Court, the high court said.

1999 Republic Act No. 7305 Magna Carta for Public Health Workers. 2003 Republic Act No. 9184 Government Procurement reform Act. 2004 National Health Insurance Act of 1995 amended to Republic Act No. 9241.

The Health Sector Reform Agenda To bring the country towards the attainment of this vision, the DOH, health professionals, health organizations and other stakeholders in health, put together the Health Sector Reform Agenda (HSRA). The agenda outlines the problems and reforms needed to bring about an efficient and effective health delivery system, a well established and strong health regulatory system and sustainable health care financing mechanisms. The HSRA prescribes the adoption of the following strategies: On Health Service Delivery ! Promoting fiscal autonomy to government hospitals ! Secure funding for priority public health programs ! Developing and strengthening of local health systems capacities On Health Regulation

! Strengthening capacities of health regulatory agencies On Health Financing ! Expanding the coverage and benefit spending of the National Health Insurance Program (NHIP) Reforms in these areas are interconnected and interrelated. Health financing reforms through the NHIP will make hospital fiscal autonomy viable; hospital reforms in turn will free resources for investments in public health and in health regulation at both the national and local levels; and good public health programs will relieve the NHIP from the burden of having to pay for increasing number of curative services and be able to address those diseases which are preventable. To get the reforms going, the DOH has to take the lead role in providing the direction of the health sector and in undertaking several initiatives to implement the reform strategies. These are: ! Formulation of the investment packages for health ! Formulation of new laws and issuance of new policy directives ! Pursuing organizational changes in the DOH, PhilHealth and LGUs ! Improvement of finance and procurement management systems The DOH should pursue the organizational restructuring it had already initiated several years ago. HSRA GOALS # Efficient and effective health delivery system # Well-established and strong health regulatory system # Sustainable health care financing Mechanisms

The organizational change in the DOH stems both from the realities within and outside of the health sector. A movement towards reinventing government has swept bureaucracies all over the world. With greater demand for specific services and meager resources, government simply cannot provide for all the needs of its various constituencies. Governance is no longer an exclusive function of governments but it has to be distributed rationally to other concerned sectors of society. The paradigm postulates that what the private sector does better, it should do without undue competition from government. In addition, non-government organizations should be allowed to accomplish what they can accomplish on their own or in partnership with government and other service providers. Governments must do what only government can do. The Local Government Code of 1991 already laid out the proper role of local governments. The national government must therefore follow suit. The rethinking of governments role began with President Fidel Ramos Reengineering the Bureaucracy for Better Governance. This was reinforced by the guidelines issued by President Joseph Estrada under EO 165, which directed the formulation of an institutional strengthening program for the Executive Branch under the Presidential Committee on Effective Governance (PCEG). There were a number of studies already done on organizational efficiency, as a result of the devolution of health services. For a number of reasons however, the identified necessary changes did not materialize. Between 1992 and 1998, the DOH management undertook three major reorganization attempts. The first one was during the term of Secretary Juan M. Flavier; the second began under Secretary Jaime Galvez-Tan and continued under Secretary Hilarion Ramiro; and the third by Secretary Carmencita N. Reodica. The reorganization under EO 102 initiated by Secretary Alberto G. Romualdez, Jr. was the fourth major effort at rationalizing and streamlining the DOH after the devolution of health services to the local governments.

Executive Order 102 issued in May 1999 Redirecting the Functions and Operations of the Department of Health gave it the mandate to institute the necessary organizational changes. The issuance and implementation of EO 102 is based on Sections 77 (Organizational Changes), 78 (Implementation of Reorganization) and Section 79 (Scaling Down and Phasing Out of Activities of Agencies within the Executive Branch) of the General Provisions of the General Appropriations Act (GAA) for 1999. The same provisions were also included in the GAAs of 1995 to 1998, which is in keeping with Section 42, Chapter 5 and Book VI of the Administrative Code of 1987. EO 102 mandates the DOH to provide assistance to LGUs, peoples organizations (PO) and other members of civil society in effectively implementing programs, projects and services that: 1. Promote the health and well being of every Filipino. 2. Prevent and control diseases among populations at risks.

3. Protect individuals, families and communities exposed to health hazards and risks. 4. Treat, manage and rehabilitate individuals affected by disease and disability. Among others, EO 102 stipulates the preparation of a Rationalization and Streamlining Plan (RSP) for the DOH. Phase1 of the RSP shall contain all the proposed structures, functions and staffing pattern of the different offices in the Central Office (CO), including the Bureau of Food and Drugs (BFAD) and the National Quarantine Office (NQO). Phase 2 shall deal with streamlining the functions and staffing pattern of the regional offices and retained hospitals, while Phase 3 shall deal with the DOH attached agencies. EO 102 is complemented by a later issuance affecting the health care service delivery system. EO 205 dated January 31, 2000 provides for the creation of a National Health Planning Committee (NHPC) and the establishment of Inter-Local Health Zones (ILHZs) throughout the Philippines. In tandem with EO 102, EO 205 is expected to accelerate service delivery under a decentralized mode.

In the formulation of the RSP, the DOH considered the governance framework formulated by the Presidential Committee on Streamlining the Bureaucracy (PCSB) under the DBM in August 1995 and reinforced by the PCEG in October 1999. The guiding principles of this framework were: Principle of Frugality and Prioritization - The scope of government shall be within available resources and its activities accordingly prioritized. Government should have a conscious and deliberate effort to define what it will do, must do, can doand wants to do given the call of the times, its legal mandate, resources and constraints. All these shall be defined in the governments plans and policy pronouncements. Principle of Steering - The role of the national government in the sectors shall be to steer rather than row the boat. The focus of its sectoral functions therefore shall be on the following: 1. Policy setting, monitoring and assessment. 2. Promotion and advocacy. 3. Provision of information and linkages or access to markets, services and production inputs and outputs. 4. Provision of assistance and incentives that will equalize and level the playing field. 5. Enforcement of appropriate rules and regulations. 6. Ensuring the provision of safety nets for adversely affected population This principle also laid down the relationship of the government to the private sector. It is governments role to: 1. Promote a stable policy environment; set minimum and appropriate rules; provide information and give support to the production of goods rather be directly engaged in it. 2. Encourage sharing of resources and responsibility. 3. Assume primary responsibility in the production of public goods and services. Principle of Vertical Compartmentalization - Government should reduce duplication of effort and maximize the use of all resources to achieve socioeconomic and political goals. Sectoral activities shall be properly compartmentalized and accordingly appropriated between thegovernment and the private sector. Government activities shall be properly distributed among levels of government - central government, government corporations and local government units. Principle of Devolution - The national government and local government units shall be partners in the pursuit of the development process. The proper role of the national government is to set national policy and standards; and assist, oversee and, monitor local government units complementary to the stronger implementing role that local governments shall assume. Parameters - The organizational change in the DOH took into consideration the following basic policy framework. 1. Leaner and Better Central Office (CO). Enhancing the central office function particularly on policy formulation and on establishing technical leadership in health. 2. Stronger and More Responsive Field Offices and Facilities. Strengthening of field offices including hospitals and attached agencies to support direct service provision and technical leadership in health.

3. Technical Leadership Over Health Programs and Increased Technical Assistance to Local Health Systems. Strengthening of DOHs advocacy role; emphasizing the need for stronger external networking and linkaging. 4. Integration of Public Health Concepts in the Hospital System. Ensuring that preventive and promotive health concepts are also operational in hospitals. 5. Stronger Regulatory Systems for Quality Assurance in Health. Ensuring enforcement of health standards by reinforcing standardsetting activities, focusing on quality assurance and deploying more enforcement officers in the field. 6. Stronger National Health Insurance System. Strengthening the national health insurance system to ensure more access to health by the less privileged, especially the indigents. Guidelines - In addition, the reengineering efforts of DOH were guided by the following specific guidelines and rules: 1.No person will be laid-off or demoted in keeping with existing Civil Service Commission (CSC) rules on reorganization. The worst scenario is deployment to the various hospitals or field offices where a persons security of tenure is assured unless he or she choosesto resign, retire or seek voluntary separation. A six-month period was provided during which time employees may choose which offices they wish to be deployed to. 2. CO will attempt to diminish the number of its personnel by half in keeping with the realignment of functions envisioned in the RSP. 3. The grouping of functions will reflect the DOHs major reform areas for the next ten years. 4. The reengineered DOH will have a personnel budget that does not exceed its present Personal Service allocation. 5. A system of incentives will be developed for relocating personnel including relocation allowances, assurance of security of tenure and equal consideration for career movement within the DOH, whether at CO, the field offices, the hospitals and the attached agencies Executive Order 102 provided the DOH with the excellent opportunity to look at its strengths and weaknesses and assess opportunities and threats inherent in the organization. The DOH may be expected to perform its functions more effectively, efficiently and economically given a legal mandate that refocuses its concerns the deployment of staff to ensure organizational muscle and the reallocation of resources. To do all these, the DOH has set its goals and strategic objectives to meeting the following challenges: 1. The crafting of a human resource development (HRD) plan for the bigger health sector outside of organic DOH personnel to ensure smooth and coordinated implementation of national health programs. 2. Developing an HRD plan to build internal capacity for: a. Technical assistance b. Health investment and resource mobilization c. Linkage and network development for all constituencies d. Political skills and advocacy e. Policy development, program planning and project management 3. Building a technical and financial resource base for health investments to ensure continued access to quality health service for the underprivileged and the disadvantaged. 4. Streamlining internal systems in keeping with a leaner staff. 5. Installation of an operating MIS including computerization of key processes, such as procurement, data on epidemiology and other relevant concerns. 6. Providing health partners such as NGOs, LGUs, private sector with better and more sustainable technical and other resource support. External Human Resource Development While devolution has removed the administrative supervision of local health personnel from the DOH, the fact remains that national health programs and standards can only be implemented with the assistance of grassroots health workers from the public and private sectors. The DOH maintains a field presence in the bigger administrative regions, but it still requires the support of local health workers to ensure program success and effectiveness. It may be incumbent on the DOH to develop a systematic program for training health workers in the local areas, whether public or private. At the same time, the DOHs career progression system must consider its own organic positions as open to outstanding practitioners outside of government to ensure the continued influx of new talents and fresh ideas. This should also serve as an incentive for devolved employees who feel that the Local Government Code has effectively put a dead end to their careers as health bureaucrats. Internal Human Resource Development - A leaner bureaucracy at CO and a slightly expanded staff at the field offices and facilities would optimize opportunities for efficiency and effectiveness. However, the shift in focus of a devolved DOH requires reorientation both in terms of skills and knowledge. Among others, DOH personnel at CO must gain additional skills at providing technical assistance, mobilizing resource for health investments and developing linkage and network with various constituencies. At the field level, DOH functionaries must be able to understand and harness political skills for greater advocacy of national priorities. At both ends, there should be increased proficiency at policy development, program planning and project management. Actual Resource Mobilization for Health Investments - In addition to being trained for resource mobilization, internal capacity must exist for knowing where and when financing may be accessed; and how this can be translated into infrastructure for accessible and quality health service. Reengineering Systems for Results A leaner staff would require reengineered systems that will make up for the previous people-intensive operations. What this means, among others, is a review of existing systems such as procurement and personnel to make these friendlier to internal users.Installation of Operating MIS

in addition to a review of existing systems, it is equally necessary to move into a computerized management information system that incorporates data on procurement, epidemiology, health trends and similar information. This will allow not only for faster but for more informed decision-making. Providing Health Partners with Relevant and Sustained Assistance It has become increasingly clear that government alone cannot provide for all of a countrys health needs. It needs to partner with academe, LGUs, NGOs and civil society in general, to bring about a state of national well being. Among the challenges faced by a new DOH is in exercising its leadership role in health matters, to be able to provide and in turn be enriched by inputs from its health partners. Organizational Review of Other DOH Offices Owing to the tremendous work entailed by the reengineering process, there are still other DOH offices that need closer organization review with respect to its structure and functions. Some of these offices are still maintaining their old staffing structure and number, which are quite oversized and incongruent with reengineering principles. A more in-depth review of the organizational structure and functions of the BFAD and the NQO that were not thoroughly touched in Phase 1 should follow suit. Also, a further look into the Centers for Health Development, particularly the role of DOH Representatives and the need for more regulatory officers at field level, among others are in order. Staffing pattern of hospitals under the DOH also need to be reviewed further. The proposal is for these activities to be initiated and implemented as the second stage of RSP. A review of the organizational structure and functions of the DOH attached agencies should also be tackled under phase 3 of the RSP. Mandate - EO 102 mandates the DOH to redirect its functions and operations in accordance with the devolution of basic health services to the local government units. Likewise, the DOH is expected to provide assistance to local government units (LGUs), non-government organizations (NGOs), other national government agencies, people's organizations (POs) and the health sector in general in effectively implementing health programs, projects and services to every Filipino. Vision The DOH is the leader, staunch advocate and model in promoting Health for All in the Philippines. It will set performance standards and health systems within the country that shape and promote the ideals of quality, equity and sustainability of health care. Mission To attain its vision, the Department of Health shall guarantee equitable, sustainable and quality health for all Filipinos, especially the poor and shall lead the quest for excellence in health. The DOH shall do this by seeking all ways to establish performance standards for health human resources; health facilities and institutions; health products and health services that will produce the best health systems for the country. This, in pursuit of its constitutional mandate to safeguard and promote health for all Filipinos regardless of creed, status or gender with special consideration for the poor and the vulnerable who will require more assistance. The DOH adheres to the highest values of work, as it pursues its vision for the organization. These are: ! INTEGRITY We believe in integrity by upholding the truth. We shall pursue strategies that are aligned with our vision and mission and strive to work with honor and dignity. We shall pursue honesty, accountability and consistency in the performance of our functions. ! EXCELLENCE We believe in excellence by continuously striving for the best. We shall encourage discipline, innovation, effectiveness and efficiency. We shall foster pro-action, dynamism, creativity and openness to change. ! COMPASSION AND RESPECT FOR HUMAN DIGNITY We are compassionate and adhere to respect human dignity. We shall work with sympathy and benevolence for those in need with sensitivity, responsiveness, relevance and a sense of urgency. We shall not judge character based on stature, nor on living condition. We shall uphold quality of life for all constituents. ! COMMITMENT We commit to achieve the vision with all our hearts and minds. We shall see it through even if we are no longer there to see it happen and shall make sure that future generations shall have continued what we started. ! PROFESSIONALISM We believe in professionalism and will dispense our functions in accordance with the highest ethical standards, the principles of accountability and responsibility. ! TEAMWORK Teamwork is the cornerstone of our success. We work together with a mindset to achieve results. We are conscious and responsible of what is expected of us following the ideals of self-direction and in consonance with prescribed authority. ! STEWARDSHIP OF THE HEALTH OF THE PEOPLE We are the stewards of the health of the people. We shall pursue sustainable development and care of the environment as it impacts on the health of our people. We shall make sure that we leave a better world for those yet to come given the tasks we have to do. Our policies, strategies and actions shall leave the environment unharmed and better for the health and development of future generations. Directional goals have been set for the short term, medium term and long term periods. Short term encompasses period up to 2002, medium term up to 2004 and long term up to 2010. Health Sector reform is the overriding goal of the DOH. Support mechanisms will be through sound organizational development, strong policies, systems and procedures, capable human resources and adequate financial resources. To develop health reforms that will ensure achievement of National Objectives for Health, the following objectives are established. ! Short Term- Health Sector Reform Agenda is institutionalized. ! Medium Term Health Sector Reform Agenda is implemented. ! Long Term Sustainable health sector reforms are established. TABLE 8 TARGETS AND PERFORMANCE INDICATORS Targets Performance Indicators Short-term 2002 Medium-term 2004 Long-term 2010

A. HEALTH FINANCING 1. At least 85% Filipinos are active members of PHIC Household Enrollment Targets: Individually paying 2.2 M 3.3 M* 3.3 M* Government 1.6 M* 1.6 M* 1.6 M* Private 4.0 M* 4.0 M* 4.0 M* Indigents 2.9 M* 3.7 M* 3.7 M* * (++ Adjusted for population variables)

2. Expansion of PHIC Benefits a) Implementation of current PHIC Benefits & TB Control, Family Planning and Immunization as initial outpatient benefit package *30 LGUs **64 LGUs *** Nationwide b) Introduction of New Benefits: ** 64 LGUs *** Nationwide Outpatient Benefits c) Disease Prevention and Promotion Services Performance Indicators Short-term 2002 Medium-term 2004 Long-term 2010 3. Development of technical expertise in health financing and health economics* All middle, senior managers, of central and field offices have developed technical expertise in health financing and health economics** All bureaus include health financing as an area of expertise ***All program policies include health financing components, advocacy and health economics perspectives B. HOSPITALS 1. Corporatization of hospitals* 5 ** +10 2. Introduction of Clinical Practice Guidelines and Upgraded DOH Hospitals to enhance capacity to comply with CPGs *40 CPGs in hospitals of 30 LGUs **40 CPGs in hospitals of 64 LGUs ***Nationwide 3. Fiscal & managerial Autonomy & two-way referral system of hospital & public health facilities *30 LGUs** 64 LGUs ***Nationwide

4. Functional Hospital Operations Management Information System *30 LGUs ** 64 LGUs ***Nationwide C. PUBLIC HEALTH 1. Clinical Practice Guidelines and technical guidelines for priority public health services issued to local health units and private providers 30 LGUs 64 LGUs Nationwide 2. Passage of Disease Control Bill into law, ensuring sustained multiyear funding for priority public health programs *Enacted as Law** Multiyear Budget Release ***Multiyear Budget Release 3. Functional RESUs & PESUs and MESUs 30 LGUs 64 LGUs Nationwide D. LOCAL HEALTH SYSTEMS DEVELOPMENT 1. Implementation of Local Health Models and Comprehensive Reform Packages in selected convergence sites* Implementation of contracts with 50% municipalities of target sites in30 LGUs **Implementation of contracts with 50% municipalities of target sites in 30 LGUs and 70% municipalities in 34 LGUs*** Nationwide

2. Activation of Local Health Boards 30 LGUS 64 LGUs Nationwide 3. Development of Interlocal Health Zones (ILHZ) *1 ILHZ per province in target areas **100% of target areas ***77 provinces 1. Organizational Development To develop an organizational structure responsive to the health needs of the country. Short Term: DOH is completely reorganized. Medium Term: Bureaus, Centers, Centers for Health Development and Retained Hospitals are fully functional. Long Term: DOH organization is made responsive to changing demands. 2. Policies, Systems and Procedures To establish relevant policies and systems that can support the Health Sector Reform Agenda. Short Term: Policies, systems and procedures are revised in consonance with the new DOH vision, mission and goals. Medium Term: New systems and procedures are operational. Long Term: DOH systems are made responsive to changing demands. 3. Human Resources To establish technical leadership in the health sector. Short Term: Health Human Resource Development Plan (HHRDP) is established. Medium Term: HHRDP is implemented Long Term: HHRDP is made responsive to changing demands of the health systems. 4. Financial Resources To ensure adequate financial health resources. Short Term: At least 3.6 percent of GNP for health expenditure is provided. Medium Term: At least four percent of GNP for health expenditure is provided. Long Term: At least five percent of GNP for health expenditure is provided 5. Equipment and Facilities To set up the facilities and equipment that can support Health Sector Reform. Short Term: Twenty-five percent of DOH Central Office, Centers for Health Development, Regional Medical Centers and Hospitals are upgraded. Medium Term: Fifty percent of DOH Central Office, Centers for Health Development, Regional Medical Centers and Hospitals are upgraded. Long Term: All DOH Central Office, Centers for Health Development, Regional Medical Centers and Hospitals, are fully upgraded.