Is PhilHealth Contribution Deduction Mandatory? (Philippine Legal Context)

Short answer

Yes. For Filipinos who are classified by law as direct contributors (e.g., private-sector employees, government workers, household helpers, self-employed/professionals, and most overseas Filipinos), PhilHealth contributions are compulsory. For employees, the contribution is mandatorily deducted from payroll and remitted by the employer, who also pays the employer’s share. Some groups (e.g., senior citizens, lifetime members/qualified retirees, and indigents/sponsored beneficiaries) are covered without personal payroll deductions because the national or local government shoulders the premium.

Legal bases: the National Health Insurance Act (Republic Act No. 7875, as amended by RA 9241 and RA 10606) and the Universal Health Care Act (RA 11223) with its Implementing Rules and Regulations (IRR), plus PhilHealth rules and circulars issued under those statutes.

Why it’s mandatory

Universal, compulsory coverage. RA 11223 declares all Filipinos as members of the National Health Insurance Program (NHIP). It creates two broad classes:
- Direct contributors – persons with “capacity to pay” (employees in public or private sector, self-employed, professionals, household helpers, overseas Filipinos, and others similarly situated). They must pay premiums.
- Indirect contributors – persons whose premiums are subsidized by the national government, LGUs, or other sponsors (e.g., indigents, some persons with disability, beneficiaries of social welfare programs, and all senior citizens under RA 10645). They are covered without personal payroll deductions.
Employer withholding and remittance duty. Employers are legally obligated to (a) register their employees, (b) deduct the employee share from wages, (c) add the employer share, and (d) remit the total premium to PhilHealth within the prescribed deadlines.

Who must have deductions (and who doesn’t)

A) Employed sector (private and government) — Payroll deduction is mandatory

What happens: Your employer withholds your employee share from your salary and adds the employer share.
When: Typically monthly (or as PhilHealth prescribes).
Multiple employers: Each employer must contribute based on your compensation from them, subject to any salary floors/ceilings set by PhilHealth.
New hires: Employers must enroll and start remitting within the periods set by PhilHealth; deductions begin with the payroll period covered.

B) Household service workers (kasambahay) — Mandatory

Household employers have the same duties to register, deduct (if applicable), add their share, and remit. (Specific sharing rules depend on the wage level and prevailing PhilHealth issuances.)

C) Self-employed / professionals / freelancers — Payment is mandatory

There’s no payroll deduction, but you’re still a direct contributor and must pay your premiums yourself (often quarterly, semi-annual, or annual modes allowed).

D) Overseas Filipinos (migrant workers) — Generally mandatory as direct contributors

RA 11223 classifies overseas Filipinos as direct contributors, making them liable to contribute. Implementation details (e.g., timing, rate increases, temporary relief measures) have varied by issuance; check the latest PhilHealth guidance that applies to your situation.

E) Senior citizens — No payroll deduction

Under RA 10645, all Filipinos aged 60+ are automatically covered; premiums are paid by the national government. Seniors don’t have employee-side deductions. (If a senior is still formally employed, clarify with HR/PhilHealth which rule applies in practice to avoid double payments.)

F) Lifetime members/qualified retirees — No further contributions

Members who have met the statutory conditions (e.g., qualifying government or private retirement with required months of premium) become lifetime members and stop paying premiums.

G) Indigents and other sponsored members — No payroll deduction

Premiums are shouldered by NG/LGU/sponsors. If they later gain employment or income, they may shift to direct contributor status and then contributions resume as mandatory.

Foreign nationals in the Philippines: Coverage rules depend on visa/employment status and the latest PhilHealth circulars. Foreign employees of Philippine entities are commonly enrolled as direct contributors; confirm the current rule that applies to your category.

How much is deducted and who shares it?

Rate-setting: Contribution rates, income floors/ceilings, and sharing are set by PhilHealth under RA 11223 and prior NHIP laws.
Sharing for employees: Contributions are shared by employer and employee per current schedules.
Takeaway: The fact of deduction is mandated by law; the exact numbers change from time to time through PhilHealth issuances.

Consequences of not deducting/remitting (employers)

Administrative and monetary penalties. Employers face interest/surcharges on late or under-remitted premiums and may be subject to assessments and collection actions. (Historically, PhilHealth has imposed monthly surcharges on arrears; exact rates and computation bases come from current circulars.)
Criminal and civil liability. The NHIP law penalizes failures to register, deduct, or remit. Corporate officers who are responsible can be held personally liable under certain circumstances.
Employee protection. Under universal health care, benefit eligibility is not supposed to be defeated by an employer’s failure to remit; PhilHealth can still pursue the employer for amounts due.

Consequences of non-payment (self-employed/professionals)

Arrears and penalties may accrue until settled.
Benefit access: The UHC framework provides immediate eligibility to essential benefits, but unpaid premiums can still lead to liabilities, limits, or cost-sharing implications per current rules (which have evolved). Staying current avoids disputes and out-of-pocket surprises.

Payroll mechanics (for employees)

Payslip: Expect a PhilHealth line item each covered payroll.
Remittance proof: Employers use PhilHealth’s electronic remittance systems; employees can request certificate of contributions for personal records (useful for disputes or retirement processing).
Separations/LOA: If there’s no salary in a period (e.g., unpaid leave), no employee-side deduction can be made; coverage as a direct contributor continues, and you may shift to voluntary payment to avoid arrears until you resume pay.

Common scenarios & guidance

“Can my employer skip PhilHealth deductions if I opt out?” No. There’s no “opt-out” for direct contributors; the deduction and remittance are legal duties.
“I’m a minimum-wage earner—do I still contribute?” Yes. Minimum wage status affects income tax, not PhilHealth membership; you remain a direct contributor with shared premiums (subject to floors/ceilings then in force).
“My employer deducted but didn’t remit.” Keep payslips and report to PhilHealth (and, if needed, DOLE). Non-remittance despite deduction exposes the employer to penalties; employees should not be deprived of benefits because of employer default.
“I have two jobs.” Each employer remits based on your pay from them, subject to the prevailing salary ceiling/floor rules.
“I retired—do I still pay?” If you qualify as a lifetime member, you stop paying. If not yet qualified, contributions may continue (or you may be covered as a senior citizen if 60+).
“I’m an OFW—when and how do I pay?” You’re a direct contributor by statute; payment timing/modes (and any temporary policy relief) depend on current PhilHealth issuances and host-country arrangements. Check the latest guidance applicable to overseas Filipinos.

Employer compliance checklist

Register the company and all employees with PhilHealth.
Reflect PhilHealth as a mandatory payroll deduction each covered period.
Add the employer share and remit on time via authorized channels.
Keep remittance records and issue proof to employees on request.
Monitor PhilHealth circulars for updated rates, ceilings, and deadlines.

Worker checklist

Review payslips for PhilHealth deductions.
Keep copies of contribution records (e.g., certificates/downloads).
If you change jobs or go freelance/abroad, update your PhilHealth membership category and payment mode.
If you qualify as a senior or lifetime member, ensure HR/PhilHealth tags you correctly to avoid unnecessary deductions.

Bottom line

For employees: Yes—mandatory payroll deduction and employer remittance.
For self-employed/professionals/overseas Filipinos: Yes—mandatory premium payment (not via payroll, but still compulsory).
For seniors, lifetime members, and sponsored/indigent beneficiaries: Covered without employee-side deductions because government or sponsors pay.

Important note (not legal advice)

Contribution rates, salary floors/ceilings, deadlines, penalties, and special relief measures are set or adjusted by PhilHealth circulars. Because those details change, confirm the current figures and rules with PhilHealth or your HR/payroll team before making decisions.