President Ferdinand Marcos Jr. swore in a new president and CEO of the Philippine Health Insurance Corp. (PhilHealth) on Tuesday, February 6. The appointment comes after months of controversy surrounding the state health insurer.
Dr. Edwin Mercado replaced Emmanuel R. Ledesma Jr., who faced calls for removal due to alleged inefficiency in handling PhilHealth funds. The Presidential Communications Office (PCO) did not confirm if Ledesma resigned or was dismissed.
Mercado, a US-trained orthopedic surgeon, enters at a time when PhilHealth faces public scrutiny. Lawmakers and health advocates have questioned how the agency spends its funds, especially after it was given zero subsidy in the 2025 national budget.
Congress Slammed PhilHealth Spending
PhilHealth’s financial decisions have been under fire for months.
In December 2024, the Nagkaisa Labor Coalition urged Marcos to remove Ledesma and the entire PhilHealth board. The call came after Congress removed the agency’s subsidy from the 2025 General Appropriations Act.
During Senate budget hearings in November, senators grilled Ledesma over P89.9 billion in excess funds transferred to the national treasury. Lawmakers also slammed PhilHealth for allocating P138 million for year-long anniversary celebrations in 2025.
“How can they justify this when people struggle to get healthcare?” one senator asked during the hearings.
Cyberattack and Data Breach
PhilHealth also faced a major cybersecurity issue under Ledesma’s leadership.
In September 2023, the Medusa ransomware group hacked the agency’s database. The cybercriminals stole and leaked millions of members’ personal and medical records. The breach raised concerns about PhilHealth’s security measures and its ability to protect sensitive data.
“Public trust in PhilHealth has been shaken,” a cybersecurity expert warned after the attack. “They must rebuild confidence and strengthen their systems.”
Senators Welcome New Leadership
Several senators supported Mercado’s appointment, hoping for reforms in PhilHealth.
Senate President Francis Escudero said replacing Ledesma should have happened sooner. Senate President Pro Tempore Jinggoy Estrada added that Mercado’s medical background could help fix PhilHealth’s problems.
Sen. JV Ejercito, who pushed for Ledesma’s removal, stressed the need to lower out-of-pocket healthcare expenses for Filipinos. He criticized PhilHealth’s past leadership for acting like a “private insurance company” rather than a public service provider.
“The goal is to make healthcare accessible, not difficult,” Ejercito said.
Sen. Grace Poe also urged Mercado to make PhilHealth more responsive and efficient. Sen. Joel Villanueva expressed optimism, saying Mercado’s experience could help strengthen the National Health Insurance Program.
Health Secretary Calls for Reforms
Health Secretary Teodoro Herbosa, who chairs the PhilHealth board, congratulated Mercado but also highlighted the need for immediate changes.
Herbosa had previously clashed with Ledesma. He criticized PhilHealth’s “broken system” and questioned some of Ledesma’s public statements. At one point, Herbosa even told reporters, “I don’t know what the hell he is talking about,” after Ledesma suggested lowering member contributions.
PhilHealth’s Policy Changes Under Ledesma
Despite criticism, PhilHealth implemented key policy changes during Ledesma’s tenure.
The agency increased benefit rates for nearly all of its 9,000 healthcare packages, raising them by 30% in February 2024 and another 50% in January 2025. These were the first mass adjustments since 2013.
PhilHealth also expanded coverage for costly illnesses, including pneumonia, stroke, asthma, neonatal sepsis, and kidney disease. Claims processing times improved from 40 days in 2021 to 25 days in 2024, 35 days faster than the 60-day legal limit.
Next Steps for Mercado
Mercado now faces the challenge of restoring public trust. Lawmakers and health advocates expect him to clean up PhilHealth’s financial management and improve services.
“His focus should be on patient benefits,” Escudero said. “Not office parties, not unnecessary spending. Just healthcare.”
With PhilHealth under close watch, Mercado will need to act fast. He must balance policy changes, financial management, and cybersecurity improvements – all while proving he is the right person for the job.
