Government employees to begin getting P7,000 yearly medical allowance

MANILA, Philippines – Government employees will be granted a P7,000 yearly medical allowance beginning 2025.

The Department of Budget and Management (DBM) on Thursday, January 2, approved Budget Circular No. 2024-6, which sets out guidelines for the P7,000 allowance granted by President Ferdinand Marcos Jr.’s Executive Order (EO) No. 64 issued in August 2024.

“Pagpasok po ng 2025, maaari na po silang makatanggap ng medical allowance para makatulong sa pagkuha nila ng HMO (health maintenance organization) para sa kanilang health-related expenses o gastusin,” Budget Secretary Amenah Pangandaman said in a statement.

(Beginning 2025, they can already receive medical allowance to help them with getting an HMO for their health-related expenses or spending.)

The medical allowance will be given to personnel working in national government agencies, state universities and colleges (SUCs), and government-owned and -controlled corporations (GOCCs) which are not covered by the GOCC Governance Act of 2011 and EO No. 150, series of 2021. Employees of local government units (LGUs) and local water districts (LWDs) will also be given the P7,000 yearly allowance.

Everyone will qualify regardless of their appointment status — regular employees, casual, contractual, appointive or elective, and those hired on full-time and part-time basis — as long as they have worked in government for at least six months.

“This medical allowance is not just a benefit, it’s a vital investment in safeguarding a healthy workforce and ensuring that they perform at their best,” Pangandaman said.

However, those who already have HMO-based healthcare services due to specific laws, employees working in the legislative and judicial branches and other offices with fiscal autonomy, military and uniformed personnel, consultants and experts hired for a specific period or project, laborers hired through job contracts or pakyaw, student laborers, and those under job orders and contracts of service will not be issued a medical allowance.

According to the DBM, the allowance may be granted via HMO-type product coverage availed of by their respective organizations.

“Such arrangement, however, is without prejudice to the preference of employees to opt out from such group purchase, and individually avail of another HMO product,” the circular read.

This means that the allowance may also be availed of in cash for those who will either get or renew their own HMO product for the relevant fiscal year.

The DBM also noted that some may opt to use the P7,000 in cash to directly pay for medical expenses. This applies to those whose communities are considered among the geographically isolated and disadvantaged areas, if there are no HMO branches or licensed offices in their communities, or if their previous HMO applications were denied.

The medical allowance will be funded through the Personnel Services allotments of the employees’ respective national government agencies and SUCs. They can also tap into the Miscellaneous Personnel Benefits Fund “and any other available appropriations” under the country’s yearly budget if needed.

Meanwhile, GOCCs will finance their employees’ allowances through their respective annual corporate operating budgets.

The circular noted that if GOCCs, LGUs, and LWDs do not have enough funds to cover the P7,000 medical allowance, “a lower but uniform amount shall be granted to all qualified employees” instead. – Rappler.com