Doc05 StrategicOptions CPG

Health Sector Reform Technical Assistance Project (HSRTAP)
United States
Agency for
International
Development
Strategic Options for the Use of

Clinical Practice Guidelines (CPGs)
by the Philippine Health Insurance
Corporation
Ateneo Graduate School of Business – Health Programs
July 2002
A publication of Management Sciences for Health–Health Sector Reform Technical

Assistance Project (MSH-HSRTAP). This publication was made possible through the support
provided by the United States Agency for International Development (USAID), under the
terms of Contract No. HRN-1-00-98-00033-00.
Health Sector
Table of Contents
Reform Technical
Assistance Project
Introduction ....................................................................................................... 1
Part 1 .................................................................................................................. 4
I. Focus Group Discussion Protocol ................................................................ 5
1. Background.............................................................................5
2. Objectives ...............................................................................5
3. Respondents...........................................................................5
4. Methodology ...........................................................................5
5. FGD Tool ................................................................................6
5.1 Vignette .............................................................. 6
5.2 Questions ........................................................... 6
II. Key Informant Interview Protocol................................................................. 8
1. Introduction .............................................................................8
2. Objectives ...............................................................................8
3. Respondents...........................................................................8
4. Methodology ...........................................................................8
5. Interview Tool..........................................................................9
III. Suggested Revisions in the Research Protocol....................................... 12
1. Context .................................................................................12
2. Activity Analysis ....................................................................13
3. Scope of Work at PHIC .........................................................14
IV. Summary of Focus Group Discussions.................................................... 20
1. Respondents.........................................................................20
2. FGD Tool ..............................................................................20
2.1 Vignette ............................................................ 20
2.2 Questions ......................................................... 21
3. Issues and Points Raised......................................................21
3.1 FGD 1: May 17, 2002 ....................................... 21
3.2 FGD 2: May 18, 2002 ....................................... 23
4. Summary of FGDs ................................................................25
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4.1 FGD 1............................................................... 25
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4.2 FGD 2............................................................... 25 Reform Technical

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V. Summary of Key Informant Interviews ...................................................... 26

1. Respondents.........................................................................26
Part 2 ................................................................................................................ 27
I. Applying CPGs to Claims Paid in 2001 ....................................................... 28
1. 2001 Claims Paid per Illness for
Ordinary Cases (50% of Total Only)......................................28
2. Calculations ..........................................................................28
II. National Capital Region Current Work Flows ............................................ 30
1. NCR Current Work Flows – Summary...................................30
2. NCR Current Work Flows – Details .......................................30
3. NCR Current Work Flows – Documents Used/Generated .....30
III. NCR Estimated Output Rate ...................................................................... 31
1. Summary Data for New Output Rates ...................................31
2. PMAC Section.......................................................................32
3. General Receiving and Encoding Section – Output Data ......33
4. General Receiving and Encoding Section – Output Data ......34
5. Initial Verification Section – Output Data ...............................35
6. Medical Evaluation Section – Output Data ............................36
7. Adjudication 1 Division, Manual Processing Section
– Output Data........................................................................37
8. Adjudication 1 Division, Processing Encoding Section
– Output Data........................................................................38
9. Adjudication II Division – Output Data ...................................39
10. Voucher Review 1 (Accounts Payable I -
Adjudication 2 Div) – Output Data .........................................40
11. Voucher Review 2 (Accounts Payable 2 -
Adjudication 2 Div) – Output Data .........................................41
12. Disbursement 1 – Output Data ..............................................42
IV. Costing of NCR Current Work Flows ........................................................ 43
1. Summary of Claims Processing Costs ..................................43
2. Unit Outpost Cost per Section ...............................................44
3. Summary of Assumptions, Claims
Processing Division (NCR) ....................................................45
4. Cost of Personnel (2002) ......................................................47
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5. Personnel Costs by Section (2002) –
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(Allocation Method: Step down from Division Reform Technical
Chiefs to Sections) ................................................................52 Assistance Project
6. Cost of Supplies ....................................................................53

7. Occupancy Costs 1 and 2 .....................................................54
8. Occupancy Costs 3 ...............................................................55
9. Equipment Depreciation Costs ..............................................57
10. IT Support Costs ...................................................................58
11. Other Costs...........................................................................60
V. Costing of Regional Offices ....................................................................... 61
1. Estimated Costs of Claims Processing in Regions
Outside NCR.........................................................................61
2. Regional Claims Processing Personnel by Position ..............63
3. Claims Processing Cost per Region (2002, Outside NCR) ......69
VI. Proposed NCR Work Flows ....................................................................... 70
1. Proposed NCR Work Flows – Level 0 ...................................70
VII. Proposed Functional Chart Claims Processing Department NCR......... 71
VIII. Costing of Proposed NCR Workflows – Manpower Complement......... 73
1. Level 0 ..................................................................................73
2. Level 0 Costs ........................................................................74
3. Level 1 and 2 ........................................................................75
4. Level 1 and 2 Costs ..............................................................76
5. Level 3 ..................................................................................77
6. Level 3 Costs ........................................................................78
7. Level 4 Costs ........................................................................79
8. Summary...............................................................................80
IX. Costing of Proposed Regional Work Flows ............................................. 81
1. Level 0 ..................................................................................81
2. NCR Percent Reduction in Headcount and
Personnel Costs for Each Level ............................................82
3. Level 1 ..................................................................................83
4. Level 2 ..................................................................................84
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5. Level 3 ..................................................................................85
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6. Level 4 ..................................................................................86 Reform Technical

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7. Summary...............................................................................87
X. Return on Investment for Proposed Workflows........................................ 88
1. Summary of NCR Workflows.................................................88
2. One-Time, Up-Front Investment Costs..................................89
3. Software Development Costs for Proposed Workflows..........90
4. Timetable ..............................................................................93
5. Return on Investment (ROI) ..................................................94
XI. Electronic Filing of Claims ........................................................................ 95
1. Introduction ...........................................................................95
1.1 Machine-readable data ready for documentation
and analysis of claims for operational and clinical
research ........................................................... 95
1.2 Online error checking at several levels ............. 95
1.3 Standard application of business logic
across claims and across evaluators/encoders (CPGs) 95
1.4 Lower operational costs.................................... 96
1.5 Improved security: ............................................ 96
1.6 Masking of data which may potentially bias evaluator 96
1.7 View status of claims online.............................. 96
2. Electronic Filing and Clinical Practice Guidelines ..................96
3. Technology, Processes and Principles..................................97
3.1 External processing system.............................. 97
3.2 Creation of electronic forms.............................. 98
3.3 Filling out of the electronic form ........................ 99
3.4 Submission of electronic form to PHIC ............. 99
3.5 Internal processing system ............................... 99
3.6 Principles of Electronic Transactions .............. 101
4. Integrating Electronic Filing into PHIC .................................103
4.1 Effect on turn around time, output rates, ..............
and manpower needs ..................................... 103
4.2 Alternatives..................................................... 104
4.3 Experience in other countries ......................... 104
4.4 Risks .............................................................. 105
4.5 Implementation Strategy and Timetable ......... 105
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4.6 Consultation with service providers ................ 105
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4.7 Systems analysis and software development . 106 Reform Technical

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5. Costs...................................................................................106
5.1 Initial investment............................................. 106
5.2 Ongoing operating costs................................. 106
5.3 Differential analysis with current operations.... 107
XII. Business Process for Claims Processing Information System ........... 109
1. Context Diagram .................................................................109
2. Functional Chart..................................................................110
3. Processes ...........................................................................111
3.1 Process – Receive and Verify Claims Online.. 111
3.2 Process – Perform Medical Evaluation ........... 116
3.3 Adjudicate all Claims Online ........................... 119
3.4 Accounting Processes .................................... 122
3.5 Process Pended Claims ................................. 123
3.6 Benefit payment to members/ check generation/ direct payment
exceptional case only ..................................... 128
XIII. Medical Logic Modules .......................................................................... 129
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Health Sector
Introduction
Reform Technical
Assistance Project
The Health Sector Reform Agenda (HSRA) was launched as a flagship program
of the Department of Health (DOH) in 1999. Among its five major components is
health care financing. The goal of this component is to decrease the proportion
of out-of-pocket spending in the total health expenditures of Filipinos by
substantially increasing the share of social health insurance. The Philippine
Health Insurance Corporation (PhilHealth; PHIC), a government-owned
corporation, is the primary national government agency charged with this
mandate, which not only includes paying for health services provided to
members, but also ensuring that such services are at an acceptable quality.
The starting point of ensuring that PhilHealth reimburses for quality care for
members is to come to an understanding of the way health conditions are
presented to accredited providers and how they are treated. Methods of care to
members must take account of evidence of costs and health outcomes.
PhilHealth is currently developing Clinical Practice Guidelines (CPGs) to
encourage a streamlining of the wide variation noted among physicians in the
treatment of certain common diseases. From its standpoint as a social health
insurer, PhilHealth could benefit from CPGs in terms of ensuring quality and cost
efficiency in the type of care it provides to members.
CPGs are developed by health professionals of a particular specialty society to

which a particular disease state is commonly diagnosed. There have been
varied experiences in countries like the United States on the use of these
guidelines among insurers and health maintenance organizations. Guidelines
are widely accepted to contribute to improved care if they succeed in moving
actual practice closer to the behaviors in the guidelines recommended. In
addition, practice guidelines also have the potential to reduce the number of
malpractice cases and the costs of settling them (although in the Philippines,
medical malpractice is not yet a common occurrence).
PhilHealth is already reviewing the use of CPGs, covering 10 high-cost types of

health care. It plans to add more to its initial list. PhilHealth has already used
the preliminary results of this review to determine some reimbursement policies,
specifically on drugs. Other groups in the Philippines have developed their own
CPGs, particularly specialty societies and the academe. There is a need to
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consolidate all CPG-related knowledge in one documentation in order to Health Sector
systematize the information and experience and avoid duplication in future work. Reform Technical
Assistance Project
As part of its technical assistance to the DOH, the Management Sciences for
Health-Health Sector Reform Technical Assistance Project (MSH-HSRTAP)
commissioned the Ateneo Graduate School of Business – Health Programs
(AGSB) in January 2002 to help PhilHealth develop strategic options for using
CPGs. In carrying out this project, the AGSB actively consulted with the medical
and insurance professions. It assessed over-all market readiness and outlined
the options for a most feasible way to implement CPGs that would have positive
impact on PhilHealth’s mandate of providing cost-effective, quality health care to
its members.
AGSB’s specific tasks included the following:
• To document and review current uses of CPGs in the Philippines, including

PhilHealth;
• To assess the readiness of providers and of PhilHealth in using CPGs;
• To identify options for PhilHealth to use CPGs for critical insurance functions
like accreditation and claims processing, with options costed out and
assessed in terms of economic and political benefits and ease of
implementation, and with trade-offs identified;
• To develop a strategic plan presentation for PhilHealth to make informed

decisions on the options; and,
• To identify the next steps or implementation plan based on the option chosen.
The AGSB completed and submitted its final report in July 2002. This document
is based on that report. PART 1 discusses the approved protocols for the Focus
Group Discussions (FGDs) and the Key Informant Interviews (KII) conducted by
the AGSB. The aim of the FGDs and KIIs was to examine the perceptions and
attitudes of professionals towards CPGs, and assess the impact of CPG use in
achieving operational efficiencies and lowering reimbursement costs. PART 1
also contains the amendments suggested by PhilHealth to the research protocol.
PhilHealth asked that the research protocol not dwell so much on the
stakeholders’ knowledge and use of the CPGs. Instead, it should explore at
great length their perceptions, opinions, and willingness to comply with possible
requirements and regulations that may be generated by PhilHealth as it relates to
using CPGs in the performance of key insurance functions like claims
processing, physician and hospital accreditation, and fraud detection.
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PART 1 summarizes the results of the FGDs and KIIs. In general, the AGSB Health Sector
finds that: (a) use of CPGs is acceptable to the medical profession if they are Reform Technical
Assistance Project
developed and disseminated by a credible group of professional medical
societies; (b) most of the apprehension about CPGs can be traced to lack of
information or misinformation; and, (c) CPG adoption by PhilHealth must be
made in partnership with key professional societies.
PART 2 contains the results of AGSB’s assessment of key PhilHealth business

operations. An assessment of PhilHealth claims data shows that PhilHealth
could have saved P177 million in 2001 had CPGs been used to assess claims for
ordinary cases. This amount is equivalent to 3% of the total claims paid in 2001.
Results of a business process analysis showed that CPGs could be implemented
most effectively by PhilHealth through computer-based medical logic modules.
In turn, this is best carried out through the electronic filing of claims. The study
provides five transition level options for claims processing of PhilHealth, with
each option costed out and assessed in terms of economic and political benefits,
ease of implementation, and trade-offs. These different transition levels are
estimated to bring about P25 million to P86 million in savings in personnel costs
(18% to 61 % of current costs), and an incredible ROI of from 783% to as high as
9,000%.
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Part 1
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Health Sector
I. Focus Group
Reform Technical
Assistance Project
Discussion Protocol
1. Background
The limited studies that have been done in the United States and Europe point to
varying results in relation to the effectives of the use of CPGs for cost control and
improvement of care. Most of these studies however articulate certain necessary
requirements in order for these guidelines to achieve their objectives of economic
efficiency and improvement of care. The question therefore arises: Will the
physicians, who are seen to be the primary users of CPGs, comply with
proposed regulations on the use of guidelines that may be required by private
and public insurers of medical care?
2. Objectives
a. To determine physicians’ readiness and willingness to use CPGs in their own

clinical practice in compliance of possible proposed requirements by
PhilHealth; and,
b. To generate suggestions on possible enabling and hindering factors to be

considered in the implementation of the use of CPGs by physicians and by
PhilHealth.
3. Respondents
Two FGDs are planned, each group consisting of from 8 to 10 participants. A

representative group of physicians from various specialties working largely in the
public and private sector will be invited. The list of respondents will be chosen
among selected members from six professional societies, namely, the Philippine
Medical Association (PMA), Philippine College of Physicians (PCP), Philippine
College of Surgeons (PCS), Philippine Pediatric Society (PPS), Philippine
Obstetric and Gynecological Society (POGS) and the Philippine Academy of
Family Physicians (PAFP). To elicit the sentiments, perceptions, and ideas of
the ordinary member, participants will be chosen from among the general
membership of these organizations. In this way, the findings from the FGD will
reflect the ordinary PhilHealth-accredited physician’s viewpoint.
4. Methodology
The FGDs will be conducted after the Key Informant Interviews have been
completed. In so doing, some of the date and information that will be generated
by the interviews can also be validated in the FGDs.
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Health Sector
The two FGDs will be conducted simultaneously in one half day. Each group will Reform Technical
have a facilitator and documentor. Discussions should not go beyond 1.5 hours Assistance Project
to ensure that interest and participation are maintained. Prior to the actual FGD,
all facilitators and documentors will be given a half day orientation to include
topics such as defining CPGs, what they are commonly used for, what PhilHealth
is and what its functions are, and what questions are to be asked. Basic ground
rules and preliminary steps prior to the discussion proper will also be presented
and agreed upon.
Prior to the actual discussion, vignettes or sample cases and situations involving
possible experiences that physicians may encounter in relation to possible uses
of CPGs by PhilHealth will be presented. After these, the actual FGD will be
started and trigger questions will then be asked by the facilitator.
The FGD tool will be pilot tested with a small group (3 persons) of physicians.
Documentation will be aided by the use of a cassette recorder, upon agreement
of the participants. Although content of the discussion will be the main focus of
documentation, some observations on process also will be made.
A consolidated report for each FGD will be prepared jointly by the documentor
and facilitator.
5. FGD Tool
5.1 Vignette
Mang Ariel, a 38 year old machine operator consulted with Dr. Adriano, a general
practitioner, for intermittent, tolerable to severe hypogastric pain, painful and
frequent urination of 7 days duration. During the interview, Mang Ariel pointed out
that this is the first time he experienced such symptoms. No other symptoms
other than those mentioned -- no urinary discharge, no abdominal pain, no fever.
He claims to be sexually active with one sexual partner – his wife. Past medical
history and family medical history are unremarkable. Physical examination
showed normal physical findings.
With a working diagnosis of Urinary Tract Infection, Dr. Adriano decided to

confine Mang Ariel to the hospital and the doctor requested that a urinalysis,
KUB-IVP and renal ultrasound be done. Urinalysis results showed significant
pyuria (10wbc/hpf) while KUB-IVP and renal ultrasound yielded normal results.
Dr. Adriano’s final diagnosis: Urinary Tract Infection, uncomplicated.
Dr. Adriano then prescribed Cephalexin 500mg three times a day for 7 days and
Ibuprofen 500mg once a day for pain. He likewise advised Mang Ariel to increase
oral fluid intake and to practice perineal hygiene. Patient was discharged after 5
days confinement and advised to come back to the doctor’s clinic after a week.
5.2 Questions
a. Situationer: When Dr. Adriano inquired about his professional fees from
PhilHealth for the care he rendered to Mang Ariel, he was informed by the
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accounting office of the hospital that PhilHealth rejected the claim and
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returned it to the hospital. The following are the reasons for rejection: Reform Technical
Assistance Project
• Laboratory Tests requested were more than what is prescribed by the

PhilHealth accredited CPG on Urinary Tract Infection (UTI) in males.
• The prescribed medicines were not the drug of choice as recommended

by the CPG on UTI in males.
• The duration of stay in the hospital was more than determined average
stay for an uncomplicated case of UTI.
b. What are your thoughts and reactions on these reasons for rejection?
c. If you were in Dr. Adriano’s shoes and you are knowledgeable about the CPG
even prior to treating Mang Ariel, would you still have done what he did
knowing that these were beyond the guidelines? Why?
d. Are the reasons for rejection justifiable? Why or why not?
e. What are your thoughts about the possibility of PhilHealth adapting the CPGs
in fulfilling some of their key functions like processing claims, accrediting
doctors and hospitals?
The questions will not be asked by the facilitator all at once. The presentation of
the various situations will be given in a staggered fashion, moving only to the
next after the facilitator feels sufficiently satisfied that the discussion has
exhausted the issue.
All possible measures will be used to ensure good attendance in the FGDs.
However, in the event that the projected number of at least 16 participants will
not be reached, efforts will be done to ensure that at least one FGD will be
conducted.
Reference: Philippine Society for Microbiology and Infectious Diseases

(PSMID).The Philippine Clinical Practice Guideline on the Diagnosis and
Management of Urinary Tract Infections Volume 1 (1998).
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Health Sector
II. Key Informant

Reform Technical
Assistance Project
Interview Protocol
1. Introduction
Different options on the use of CPGs by PhilHealth will only be successful in

achieving its objectives if the key users of the guidelines, the physicians, will
comply with the guidelines in rendering medical care to their patients. In the
Philippines, physicians are considered among the most powerful and influential
sector of the health care delivery system. Thus, since the physicians are
important stakeholders and partners of PhilHealth, their thoughts, opinions, ideas
and plans on proposed uses of CPGs to perform better the different insurance
functions needs to be gathered.
2. Objectives
a. To elicit from the key leaders of professional medical societies their ideas and
opinions on how CPGs can be used by PhilHealth;
b. To find out general thrusts and plans of the professional societies in relation
to CPG formulation and use; and,
c. To generate suggestions on possible enabling and hindering factors to be

considered in the implementation of the use of CPGs by physicians and
hospitals.
3. Respondents
A total of four (4) Key Informant Interviews will be conducted. An officer of the 4
major professional medical societies, preferably the president or the head of the
Quality Assurance Committee, of the Philippine Academy of Family Physicians,
the Philippine College of Physicians, the Philippine College of Surgeons and the
Philippine Pediatric Society.
4. Methodology
The interview tool will be pilot tested on one randomly selected officer of a
professional medical society. Upon completion of the final interview form, the
interviewer will then set the necessary appointments with the selected
respondents. The interview will then be conducted. If the respondent agrees,
the interview will be taped using a cassette recorder. Answers and notes with
some observations will then be consolidated by the interviewer and submitted.
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5. Interview Tool
Health Sector
Reform Technical
In-Depth Interview Guide for Heads of Societies Assistance Project
A. Introductory Remarks
I am _________________________from ______________________.
• General Purpose of the Study

• Aim of the Interview
• How long it will last
I would like to go over certain general rules for our conversation.
• There are no correct answers

• Want your opinion
• Confidentiality
• Minimal interruptions
Do you have any questions at this point?
B. Warm Up
What is your present position in your society/hospital?

How long have you been in that position?
What are your major roles and functions?
C. PHIC and Your Private Practice
Are you PHIC-accredited?

Have you had any problems with PHIC claims in the past?
What are those problems? Please elaborate.
How do you thinks these problems should be addressed?
(Now let us talk about more specific topics.)
D. Laboratory Procedures
What laboratory procedures do you think should be routinely reimbursed

by PHIC?
How should PHIC decide on which procedures to reimburse?
What should be the basis for this decision and why?
What role should the physician play in this process?
E. Drugs
What drugs do you think should be routinely reimbursed by PHIC?

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F. Surgical Procedures
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Reform Technical
What surgical procedures do you think should be routinely reimbursed by Assistance Project
PHIC?
(The advent of EBM has led to the development of Clinical Practice

Guidelines, as you have mentioned …)
G. Perceptions of Society Members on Clinical Practice Guidelines
Can you describe some of the perceptions of your society members on

CPGs?
Probe:
• What do they think about CPGs?

• How to they use the CPGs?
• What is your view on this matter?
• What is the society’s stand on the use of CPGs?
H. Development of CPGs
Can you describe to us the role of the society in the development of

CPGs?
Probe:
• What are the CPGs adopted or being supported by your society?

• What was the participation of the society in their development?
• What was your participation?
• How do you think the society and its member participate in the
development of CPGs in the future?
I. Dissemination and Promotion of Use of CPGs
How do you think CPGs should be disseminated and promoted among

physicians?
Probe:
• What activities were carried out by your society to disseminate and

encourage the use of CPGs?
• Who do you think should be responsible to do these tasks?
• What roles should the society assume in the dissemination of CPGs?
• What do you think are the best strategies to disseminate and
encourage the use of CPGs among your members? Among other
physicians?
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J. Incorporating CPGS into the PHIC Insurance System
Health Sector
Reform Technical
Probe: Assistance Project
• What is the society’s stand on the incorporation of the CPGs in to the

PHIC system?
• What is your personal opinion on this matter?
• How do you think should PHIC incorporate CPGs in their system?
• What aspect of the insurance system should it be incorporated to?
(claims, reimbursements, accreditation, quality assurance monitoring,
etc?
K. Comments
Is there anything else that we have not covered that you think that you
want to tell me about CPGs and its use in practice and in PHIC system?
L. Closing
Thank you.
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Health Sector
III. Suggested Revisions

Reform Technical
Assistance Project
in the Research Protocol
1. Context
Upon submission of the research protocol on February 25, 2002, a technical

meeting was called to validate with the PhilHealth representative whether the
information that would be generated from the submitted Focus Group Discussion
guide and Key Informant Interview tool sufficiently covered the needs and
concerns of PhilHealth in relation to the CPGs. In this meeting, Dr. Eduardo
Banzon of PhilHealth articulated that the research tools should not dwell so much
on the stakeholders’ knowledge and use of the CPGs but instead should explore
at great length their perceptions, opinions and willingness to comply with possible
requirements and regulations that may be generated by PhilHealth as it relates to
using CPGs in the performance of key insurance functions like claims
processing, physician and hospital accreditation and fraud detection.
In the light of these comments, a sub-amendment (Number 1) was signed and

approved by MSH-HSRTAP to revise the schedule and nature of deliverables
since the revised research instruments and protocol could not be finalized until
after the research team has completed its initial brainstorming of the top five
options to be recommended.
The next activities of the team therefore focused on finalizing these

recommendations using important must and want criteria to narrow down the
initial long list of possible choices.
On 25 March 2002, a meeting was held among representatives of PHIC, MSH,

and the Ateneo CPG Research Team to discuss the criteria to be used to
evaluate and rank the CPG strategic options to be included in the study. In this
meeting, it was agreed that the “Must” and “Wants” criteria to be used are as
follows:
MUSTS:
• Within PHIC's domain and mandate to implement after CPG development.

• Strategy should be implementable within 2 years (tenure of GMA).
• Strategy's impact must be measurable by PHIC.
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WANTS: in order of importance
Health Sector
Reform Technical
Weights Assistance Project
• Technically feasible 30%

• Improve efficiency of PHIC operations 30
• Reduce total cost of medical care 20
• Politically acceptable to external stakeholders 12
• Acceptable returns to investment 8
Total: 100%
The criterion of political acceptability makes up only 12%, while those involving
PHIC’s operations and costs make up 68% (first, second, and last criteria).
There is a need, therefore, to realign the scope of work of the Ateneo CPG
Research Team, which was heavily tilted towards gathering information
regarding political acceptability. This paper discusses the kind of work that
needs to be done, and the additional resources needed to produce the related
output.
2. Activity Analysis
Activity analysis, also known as value analysis, is an approach to operations

control that became popular during the 1980s. An activity is any discrete task
that an organization undertakes to make or deliver a product or service. Activity
analysis includes the following steps:
a. Identify the process objectives, as defined by what the customer wants or

expects from the process. The customer may be another unit within PHIC
(“internal customer”) or may be a PHIC member, physician, or hospital
(“external customer”).
b. Chart by recording from start to finish the activities used to complete the
product or service. This includes the length of each activity, its frequency, the
number of personnel involved, forms used and generated, equipment and
software used, and any special circumstance surrounding the performance of
the activity (e.g., done on an exception basis).
c. Classify activities according to their value-added and efficiency aspects.

Each activity will be classified into four types, as shown in the box below.
A value-added activity is an activity that, if eliminated, would in the long run

reduce the product’s service to the customer.
Any activity that cannot be classified as value-added is non-value-added. Non-

value-added activities present opportunities for cost reduction without reducing
the product’s service potential to the customer. Eliminating non-value-added
activities can be done after changing the underlying activity processes.
Efficient activities are activities that consume no excess resources. Activities can
be assessed for their degree of efficiency through time-motion studies or through
competitive benchmarking.
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Health Sector
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Value Added?
Yes No
Yes Type 1 Type 2
Efficient?
No Type 3 Type 4
d. Cost out each activity using Activity-Based Costing (ABC) system. The
resulting costs provide us information on which activities to focus first in terms
of eliminating for non-value added or improving for efficiency.
e. Decide on what to do with each activity. Type 4 activities can be eliminated

outright since they do not add value and are inefficient. Type 2 activities can
be eliminated eventually after the sources of efficiencies have been studied
and considered for redeployment to value-added activities. Type 3 activities
should be assessed for opportunities for efficiencies, even to the extent of
redesigning them. This includes using better work flows, simpler workstation
layouts, more relevant equipment, better training, and higher authorization
levels. Type 1 activities are retained.
f. Determine the impact of the CPG-based strategic options on the cost and
efficiency of each activity.
3. Scope of Work at PHIC
a. The following are assumed regarding the current state of PHIC operations:
• According to the Accenture Study,1 reporting relationships and functional

delineations are not clear. Issues of centralization and decentralization
exist between the Central Office (NCR) and the regional offices. Further,
PHIC’s information system is not integrated across related functional
areas.
• Our interview with Dr. Banzon showed that there is a lack of standardized
systems and procedures. Only basic documentation of process work
flows and operating performance standards exists. No studies have been
done to improve operational efficiency.
• There is poor institutional memory and lack of continuous process

improvements due to the high proportion of contractual and casual
employees. In the data presented in the Accenture Study, about two out
of three employees were non-regulars.
1
Organizational Manual documents (Volumes 1 to 4) of the Organizational Restructuring
Assistance project for PHIC, undertaken by Accenture, with funding from Management Sciences for
Health. The study was completed in April 2001.
14
b. Claims processing will be the primarily functional area for the Activity
Health Sector
Analysis. This covers the Claims Processing Department (NCR), which Reform Technical
processes and pays all claims from NCR within 30 days upon receipt. Under Assistance Project
this department are the Receiving, Verification, and Medical Evaluation

Division, Adjudication Division, Accounting Division, and Administration and
Information Division. This also covers the claims processing performed in the
15 Regional Health Insurance Offices. Table 1 contains the list of 28
activities performed.
c. The following support functions will also be reviewed insofar as they will be
affected by changes in claims processing brought about by the
implementation of certain CPG strategic options.
• Management Information Systems Department
- Performs systems analysis and design to determine efficient and

systematic manner of handling transactions
- Prepares documentation, manuals, and guidelines on applications
developed
- Develops applications systems that simplify operating processes and
enhance productivity
- Provides technical assistance to the Database and Network
Management Division in the development of utility applications for
management reporting and database maintenance.
- Ensures the integrity of all databases of PHIC
- Manages the data communication network.
• Claims Review Unit
- Reviews statements and documents that would give bearing for

possible reconsideration
- Gives decisions on all appealed claims
- Recommends for the approval of the President decisions on all
appealed claims
• Corporate Communications Office
- Prepares news and special releases for tri-media dissemination

- Establishes and maintains linkages with external publics
- Conceptualizes, designs and produces print materials on the National
Health Insurance Program (NHIP)
- Designs training modules on various aspects of NHIP for specific
audiences
- Organizes special projects designed to increase members’ awareness
on NHIP and its benefits.
• Fraud Prevention and Detection Unit
- Investigates health providers and members suspected of filing

fraudulent claims
15
- Recommends the filing of complaints against health care providers
Health Sector
and members who committed fraudulent acts Reform Technical
- Undertakes actions to prevent and detect fraud Assistance Project
• Quality Assurance Research and Policy Development Department
- Formulates standards on accreditation applied to both professional

and institutional health care providers
- Develops standards of practice of health care providers to ensure they
are of desired quality
- Reviews and evaluates existing medical compensation schemes
- Studies and develops new compensation packages
- Develops/formulates policies on the monitoring and evaluation of
institutional and professional health care providers
- Conducts utilization review of claims filed by members
- Conducts researches on outcomes assessment
d. Deliverables
ACTIVITIES DELIVERABLES
(1) Observe, document, and verify work Activity work flows and cost
flows and assign costs for claims estimates
processing activities at the Central
Office (NCR) and one regional office.
(2) Classify activities into Type 1 to 4. Activity classification
(3) Look for opportunities for greater Revised work flow

operational efficiencies and cost documentation and
savings estimated cost savings
(4) Study impact of CPG strategic options Revised work flow

on activity work flows and costs documentation and
estimated changes in cost,
brought about by CPGs.
(5) Study impact of CPG strategic options Estimated investment costs

on support office functions. These will to be incurred by these
mostly be up-front, one-time activities to offices.
implement changes in claims
processing
(6) Study impact of CPG options on total Comparison of total medical

medical costs costs for diagnoses with and
without CPGs.
These deliverables will be completed by June 10, 2002, which is the same
date for the final deliverable of the CPG Strategic Options Study.
16
e. Resource Requirement
Health Sector
Reform Technical
Some resources will be shifted from away from the key informant surveys and Assistance Project
focused group discussions of external stakeholders towards this activity

analysis. On top of this, an additional five days each for Alvin dB Marcelo
(Process documentor and Medical Informatics Specialist) and Darwin Yu
(Financial Management Specialist) will be required.
CLAIMS PROCESSING ACTIVITIES
Activity Count
1. Receiving, Verification and Medical Evaluation Division
Receives all filed claims coming from the NCR;
1.1. Receives and logs all claims filed from NCR
1.2. Encodes basic information of claimants to be included in the

database
Verifies completeness and validity of documents for every filed claim; and
1.3. Counter-checks claims against route slips
1.4. Reviews proper accomplishment of forms
1.5. Checks completeness and validity of documents attached
Evaluates and validates medical management given and assigns illness

codes and Relative Unit Values (RUV) to claims.
1.6. Reviews and approves medical management given
1.7. Assigns illness codes and RUVs
Number of activities: 7
2. Adjudication Division
Computes and approves amount of medicine, room and board, laboratory

and professional fee charges to be paid for a certain claim.
3.1. Checks the validity of attached receipts for the charges being
claimed
3.2. Computes and encodes total amount of benefits to be paid.
17
Activity Count Health Sector
Reform Technical
Assistance Project
Prepares vouchers for claims to be paid
3.3. Checks the accuracy of details and computation of claims that

were processed
3.4. Prepares voucher of claims to be paid.
Prepares payment notice for beneficiaries
3.5. Prepares payment notice for beneficiaries
3. Accounting Division
Reviews vouchers received from Adjudication section
3.1. Re-computes benefit payment of claims submitted by the

Adjudication Division
3.2. Checks the number of claims and the beneficiaries against the
vouchers prepared by the Adjudication Division
Prepares payments and related documents
3.3. Certifies availability of funds
3.4. Prepares checks for members and health care providers
3.5. Prepares summary of withholding tax remitted to BIR
3.6. Issues Certificate of Tax Withheld to professional health care

providers
3.7. Acts appropriately on voucher adjustments and check

replacements
3.8. Keeps all original filed claims
18
Activity Count Health Sector
Reform Technical
Assistance Project
4. Administration and Information Division
External and internal communications
4.1. Acts and responds to all external and internal communication
4.2. Provides information such as claims status, policies, on

membership and contributions
4.3. Gives assistance to members with inquiries
Claims processing
4.4. Monitors processing of claims
4.5. Screens and forwards claims with adjustments to the

Administration
4.6. Monitors staff performance
4.7. Provides supplies and equipment
4.8. Keeps all records
Total number of activities: 28
19
Health Sector
IV. Summary of Focus

Reform Technical
Assistance Project
Group Discussions
1. Respondents
Two FGDs were conducted for the study. The first FGD was conducted on May
17, 2002 at the Ateneo Professional Schools in Rockwell. Eight physicians, all
certified specialists with active clinical practice in Metro Manila, participated in the
FGD. Seven of the eight participants also hold administrative positions in the
hospitals that they are affiliated with, such as being Clinical Department
Chairpersons and Head of Training. All participants are active members of their
respective professionals societies and are pursuing or have completed
postgraduate studies.
The second FGD was held on May 18, 2002 at a restaurant in Angono, Rizal.
There were likewise eight participants to the FGD. All are certified specialists
whose clinical practice is in the area of Eastern Rizal, specifically, Angono and
Taytay. All are active members of the activities of their own societies especially
during chapter meetings. Aside from their specialty training, none of the
respondents have credits for courses in postgraduate education.
2. FGD Tool
2.1 Vignette
Mang Ariel, a 38 year old machine operator consulted with Dr. Adriano, a general
practitioner, for intermittent, tolerable to severe hypogastric pain, painful and
frequent urination of 7 days duration. During the interview, Mang Ariel pointed out
that this is the first time he experienced such symptoms. No other symptoms
other than those mentioned -- no urinary discharge, no abdominal pain, no fever.
He claims to be sexually active with one sexual partner – his wife. Past medical
history and family medical history are unremarkable. Physical examination
showed normal physical findings.
With a working diagnosis of Urinary Tract Infection, Dr. Adriano decided to

confine Mang Ariel to the hospital and the doctor requested that a urinalysis,
KUB-IVP and renal ultrasound be done. Urinalysis results showed significant
pyuria (10wbc/hpf) while KUB-IVP and renal ultrasound yielded normal results.
Dr. Adriano’s final diagnosis: Urinary Tract Infection, uncomplicated.
Dr. Adriano then prescribed Cephalexin 500mg three times a day for 7 days and
Ibuprofen 500mg once a day for pain. He likewise advised Mang Ariel to increase
20
oral fluid intake and to practice perineal hygiene. Patient was discharged after 5
Health Sector
days confinement and advised to come back to the doctor’s clinic after a week. Reform Technical
Assistance Project
2.2 Questions
a. Situationer: When Dr. Adriano inquired about his professional fees from
PhilHealth for the care he rendered to Mang Ariel, he was informed by the
accounting office of the hospital that PhilHealth rejected the claim and
returned it to the hospital. The following are the reasons for rejection:
• Laboratory Tests requested were more than what is prescribed by the

PhilHealth accredited CPG on UTI in males.
• The prescribed medicines were not the drug of choice as recommended

by the CPG on UTI in males.
• The duration of stay in the hospital was more than determined average
stay for an uncomplicated case of UTI.
b. What are your thoughts and reactions on these reasons for rejection?
c. If you were in Dr. Adriano’s shoes and you are knowledgeable about the CPG
even prior to treating Mang Ariel, would you still have done what he did
knowing that these were beyond the guidelines? Why?
d. Are the reasons for rejection justifiable? Why or why not?
e. In 2001, 2.4 % of claims processed by PhilHealth were for UTI. The total
amount reimbursed to MDs on UTI last year was 7.5 million pesos for 23,706
claims paid. Average value paid per claim on UTI was 2810.74 pesos. The
highest paid provider received a total of 1.5 million pesos for 346 claims last
year.
• What is your initial reaction to this statement?

• Do you think these amounts are appropriate to the level and nature of
expenses for UTI?
f. What are your thoughts about the possibility of PhilHealth adapting the CPGs
in fulfilling some of their key functions like processing claims, accrediting
doctors and hospitals?
3. Issues and Points Raised
3.1 FGD 1: May 17, 2002
a. With the first question, the group agreed that patient should have not been
admitted/confined by Dr. Adriano. Most of them also concurred that the
laboratories done were excessive, described as “overkill”& “gunshot”. On the
other hand, one of them attested that one could not blame the doctor
because, in the province, GPs would do everything to be able to exhaust the
funds they can claim.
21
Health Sector
b. With the question regarding their feelings if they were in Dr. Adriano’s shoes Reform Technical
and PhilHealth rejected their claim, most of them commented that they should Assistance Project
be able to justify their actions. They claim that medicine is an art, and the
doctor should be given the freedom to practice. One doctor even
hypothesized that maybe it was the patient who requested to be admitted,
thus, admission was justifiable. Another doctor, on the other hand,
commented that the one rejecting the claim also could be blamed, especially
if he/she is not a medical practitioner, because the doctor wasn’t asked to
justify his actions. A suggestion was made by another that doctors should
add other diagnoses – include the other differential diagnoses, in order to
justify the reimbursement.
c. Most of the doctors (if not all) are not in favor with PhilHealth’s use of CPGs.
One of them mentioned that he, as a doctor, has already given service, so, it
is only fair that he be given compensation. Another admitted that although the
use of CPGs would lessen complaints to PHIC, the things you can do would
be limited. If one is thinking of a certain disease, he might not go through a
certain process of thinking, because, it is not within the guidelines. Medicine
is an art and it cannot be imposed. Guidelines are only there to help the
doctor. Most of the doctors argued that with the use of CPGs, PHIC would not
give the doctors any room to practice. CPGs will only give doctors restriction.
d. When asked about the possible benefits that CPGs can bring if used by
PhilHealth, most of the doctors admitted that CPGs could lessen fraudulent
cases. One even recognized that it could lessen the cost of clinical practice.
And clinical practice, with the use of CPGs, will be based on scientific
evidence.
e. When asked about the feasibility of the doctors accepting CPGs, most of
them agreed that CPGs are not really difficult to accept as long as these are
approved by a consensus, by specialty societies. Approval should also be
multidisciplinary. There should be a representation on which CPG to use.
One doctor explained that all of the specialties have protocols to follow, but
these are not protocols made for insurance reimbursement. Likewise, a
doctor argued that he could only base his acceptability of CPGs subjecting it
on his own “know-how”, his own “palatability”. One doctor also wanted the
CPGs to be continually updated. Questions asked include: “Who will assess
claims? Who will approve or disapprove reimbursements? Will it be a
specialist? A person of authority?”
f. It is important that a person of authority will assess the claims because for
these doctors, it is an insult for a non-doctor to reject their formulated
diagnosis.
g. The doctors don’t agree that diagnosing a patient can be reduced to an

equation. They reiterated that medicine is an art and cannot be reduced to a
mere mathematical equation. Doctors cannot be dictated by certain
guidelines. They said that PHIC should let doctors do what they’re supposed
to do. If PHIC approves CPGs, doctors should be given flexibility, some
“elbow room” to diagnose. Monetary benefit is secondary.
22
h. It has been also observed that most of the doctors don’t know how a CPG
Health Sector
looks like, or what a CPG is. Most doctors agree that there should be more Reform Technical
aggressive information dissemination. Doctors and patients should be Assistance Project
educated regarding the CPGs. Likewise, they suggested that a law should be
promulgated that all doctors have access to PHIC regarding its guidelines
and rules.
i. Most doctors, being specialists are also wary of the eventual equality of
reimbursement between GPS and specialist or sub-specialist. Most are afraid
that the patients would eventually go to GPs, instead of specialists.
j. When presented with the statistical data about UTI from PhilHealth, most of
the doctors questioned the validity of the data. Questions include: “ What is
the criteria/basis of UTI?”, “Was a urine culture documented?” One doctor
even commented that these data could easily be manipulated by anyone with
an ulterior motive.
k. CPGs can be more acceptable in reimbursement of drugs. But, a problem

can be encountered in the provinces where only certain medicines are
available.
l. Most of the doctors agree that CPGs will be beneficial if it could make the
physician’s work easier. Conversely, diverse reactions were obtained
regarding the proposal of earlier reimbursement. Some doctors, especially
those in the surgical fields who get a bigger amount, approve of the use of
CPGs if it would mean earlier reimbursement. On the other hand, those who
are not in the surgical field attested that earlier reimbursement does not really
matter.
m. It has also been suggested that post-marketing evaluation of CPGs should

be done. The doctors should know how much PHIC saved from using CPGs.
This is to prove that using CPGs has indeed been beneficial to all. If CPGs
were proven beneficial, it would encourage other doctors to use CPGs in their
practice.
n. The method of peer review as means of evaluation of rejected cases has

been approved by the group.
o. Re: incentives, some doctors claim that it will all go back to the acceptability
of the CPG. Questions asked include “ Can PHIC maintain it for a long
period of time?”
3.2 FGD 2: May 18, 2002
a. With the first question, most of the group agreed that Dr. Adriano should be
given some latitude with regards to his management of the patient. They think
that maybe he can justify his management. One doctor among the group said
since he is a GP, he should be given “leeway”, but if he’s a specialist, he
should not have “known better” and managed the patient differently. Only one
other doctor agreed with PhilHealth in rejecting the claim.
23
b. The group is not in agreement with the imposition of CPGs by PhilHealth.
Health Sector
They claimed that doctors should be consulted first before PHIC implements Reform Technical
the guidelines. Likewise, the group thinks that these guidelines cannot be Assistance Project
imposed because clinical cases are usually managed on a case to case

basis. It should be the doctor’s prerogative to manage the patient. And if this
management is being questioned, these doctors should be given a chance to
justify their management. One doctor said that a physician has a right to
practice. “Di pwedeng de-kahon ang medical practice”. Surprisingly, most of
the doctors are not familiar with the approved CPGs. They even asked if
these guidelines were readily available for all doctors. One doctor suggested
that these CPGs should be distributed during accreditation, thus giving the
doctors the responsibility to read on the said guidelines.
c. The group also stipulated that the evaluator of claims should be a medical
practitioner. In addition, one doctor claimed that if the medical evaluator is not
a physician, he has the tendency to go “by the book”, in contrast to a
physician who will be flexible in evaluation.
d. When asked about the possible benefits CPGs can give if used by PhilHealth,
most of the group agreed that it could be used to monitor physicians who
commit fraud and abuse their power.
e. The group also stated that CPGs should be approved by fellow physicians
who are in authority, like members of the specialty societies. Likewise, the
approval should also be multi-disciplinary.
f. The group also suggested that PhilHealth-accredited doctors and members

should be educated with regards to the CPGs. There should be proper
information dissemination. The doctors should know this in order for them to
be able to present the options to the patient, e.g. most doctors don’t know
which diagnostics are covered. GPs should be given a complete set of the
CPGs, since they manage a variety of cases. Another member of the group
suggested that CPGs should be taught as early as during medical school.
g. When presented with the statistical data about UTI from PhilHealth, most of
the doctors implied that the data is fraudulent and agreed that this should be
investigated. One of them stated that if a doctor were committed to
perpetrating fraud, PhilHealth would not be able to stop him or her even if
CPGs were imposed.
h. Some members of the group don’t agree with computerization because it will
provide restrictions to the physician’s practice. They wanted a “human mind”
to evaluate the cases. And likewise, they suggest that only unusual cases
should be investigated.
i. Most of them are reluctant to approve of PhilHealth’s use of CPGs because

they value their “freedom”. They feel that CPGs should be secondary, and
that the welfare of the patient should come first. “If the patient is getting well
with the doctor’s own management, what is the use of CPGs?” One of them
even stated that it is not easy to fill out the PhilHealth forms.
24
j. When the group was presented with the idea of incentive, most of them didn’t
Health Sector
yield to the approval of the use of CPGs. They reiterated that the very nature Reform Technical
of the medical profession is service-oriented. Monetary compensation is Assistance Project
secondary as evidenced by their non-pursuit of patients who do not pay.
k. The group liked the idea of being able to monitor what happened to their filed
claims. Most of them attested that they weren’t informed by PhilHealth which
of their claims were rejected.
4. Summary of FGDs
4.1 FGD 1
• CPG is acceptable if selection and formulation process is credible –

multidisciplinary.
• Need for proof that using the CPG will lower down cost.
• Approval of claims –credible, person of authority.
• Intensive information dissemination both to doctors and beneficiaries.
• CPGs will be acceptable if it will make reimbursement and the process

easier.
4.2 FGD 2
• CPG is acceptable if selection process is credible – multidisciplinary.
• Approval/Evaluation of claims –credible, physician.
• Intensive information dissemination/ education of physicians and members.
• CPGs are NOT acceptable even if it will make reimbursement and the
process easier.
25
Health Sector
V. Summary of Key
Reform Technical
Assistance Project
Informant Interviews
1. Respondents
There were four key informant interviews that were done for this study. The
respondents were: (a) the president of one of the largest medical professional
society in the country, (b) one head of the medical staff division of a large private
tertiary hospital in Metro Manila who is concomitantly an active member of the
board member of a medical specialty society, (c) a hospital administrator of a
secondary hospital in a suburban town outside of Metro Manila, and (d) a
practicing surgeon who trained in the USA for four years and is presently a
consultant of a tertiary hospital in Manila.
26
Part 2
27
Health Sector
I. Applying CPGs to
Reform Technical
Assistance Project
Claims Paid in 2001
1. 2001 Claims Paid per Illness for Ordinary Cases (50% of Total Only).
ILLNESS TOTAL PAID CLAIMS AVERAGE PAID PERCENT

ILLNESS NAME
CODE AMOUNT NO. CLAIMS OF TOTAL
598010 Abortion D&C 130,838,746.05 26,451.00 4,946.46 6.60%
131400 Episiorrhapy (Primi) 129,440,514.38 30,883.00 4,191.32 6.53%
Other noninfective
5580 111,674,897.45 50,846.00 2,196.34 5.64%
gastroenteritis and colitis
Acute bronchitis and
4660 88,570,521.04 37,807.00 2,342.70 4.47%
bronchiolitis
Other disorders of urethra and
5990 70,835,734.32 25,674.00 2,759.05 3.57%
urinary tract
4930 Asthma 69,464,534.33 23,581.00 2,945.78 3.51%
4010 Essential hypertension 61,575,234.93 24,747.00 2,488.19 3.11%
Pneumonia, organism
4860 55,812,428.48 21,055.00 2,650.79 2.82%
unspecified
610 Dengue 54,304,442.17 15,928.00 3,409.37 2.74%
60 Amoebiasis 48,729,489.43 19,881.00 2,451.06 2.46%
Acute upper respiratory
4650 infections of multiple or 47,685,092.63 18,863.00 2,527.97 2.41%
unspecified
5350 Gastritis and duodenitis 43,915,739.76 18,899.00 2,323.71 2.22%
5900 Infections of kidney 40,272,873.69 16,004.00 2,516.43 2.03%
4630 Acute tonsillitis 39,697,943.13 15,651.00 2,536.45 2.00%
2. Calculations
a. Acute Tonsillitis
• Total amount paid for these claims: P 39,697,943.13
• Estimate 75% of total number of claims would not have been

admissible if CPGs were applied
• 75% of total amount paid for these claims: P 29,773,457.35
b. Other Illnesses (Ordinary Cases)
• Total amount of claims paid for 6 other OPD illnesses:

P 369,392,882.68
28
- Other non-infective gastroenteritis and colitis Health Sector
Reform Technical
- Essential hypertension Assistance Project
- Pneumonia, organism unspecified

- Amoebiasis
- Acute upper respiratory infections, multiple or unspecified
- Gastritis and duodenitis
• Estimate 40% of these claims would not have been admissible had
CPGs been applied
• 40% of total claims paid for these illnesses: P 147,757,153.10
c. Possible Total Saving from A and B: P 177,530,610.45
d. Arriving at Percentage from Total Claims
• Total Claims Paid for All Cases in 2001: P 5,994,303,962.99
• Arriving at percentage:
P 177,530,610.45 ÷ 5,994,303,962.99 = 0.29 or around 3%
e. Applying to Estimated Claims for 2002
• Estimated total amount of claims to be paid in 2002:

P 9,000,000,000.00
• 3% of total amount: P 270,000,000
29
Health Sector
II. National Capital Region

Reform Technical
Assistance Project
Current Work Flows
(Note: available in hard copy only.)
1. NCR Current Work Flows – Summary
2. NCR Current Work Flows – Details
3. NCR Current Work Flows – Documents Used/Generated
30
Health Sector
III. NCR Estimated Output Rate

Reform Technical
Assistance Project
1. Summary Data for New Output Rates
Ave Output Standard Ave # of Standard Ave Total Standard

DIVISION/SECTION Output
per Pax/Day Deviation People/Day Deviation Output/Day Deviation
RECVNG/VERIF/MED DIVISION
PMAC Direct filed claims 161 39.68
Direct filed RTH 50 30.82
Direct filed Denials 20 30.04
Hospital filed claims 1431 729.90
General Receiving and Encoding Claims encoded 189.65 51.62 9.25 0.72 1,754.50 486.27
Claims re-encoded 116.40 151.91
Initial Verification Claims 186.30 31.84 9.55 1.19 1,786.05 433.70
Medical Evaluation Unit Claims 179.90 17.25 9.20 1.15 1,659.80 288.37
ADJUDICATION 1 DIVISION
Adjustment/CRU/Legal Claims adjusted 739.00 4.00
Manual Processing Section Claims processed 154.80 26.12 10.50 1.40 1,639.25 387.37
Processing Encoding Section Claims encoded 180.70 7.20 7.20 1.01 1,303.50 407.67
ADJUDICATION 2 DIVISION Claims 88.20 21.45 18.40 1.10 1,679.05 285.12
Good claims 1,448.60 266.95
RTH 204.30 89.39
Denied 19.15 9.02
ACCOUNTING DIVISION
Voucher Review 1 Data 120.90 21.80 6.00 1.30 716.25 147.46
Voucher Review2 124.90 22.57 6.15 1.50 753.75 175.92
Disbursement 1 Claims paid 1,487.95 350.01
Auto-credit 333 98.13 3.00 -
Checks issued 319 86.40 2.00 -
31
2. PMAC Section Health Sector
Reform Technical
Assistance Project
OUTPUT DATA for Directly-filed Claims OUTPUT DATA for Hospital-Filed Claims
April/May Adjustment April/May Adjustment

# of Claims # of Claims
Date # of RTH # of Claims # of Claims Date
Received Denied # of RTH # of Claims Received # of Claims Received
Received Denied
1/4/2002 120 48 4 1/4/2002 2103
1/16/2002 132 97 12 1/16/2002 2833
1/2/2002 120 60 21 1/2/2002 633
1/30/2002 104 35 31 1/30/2002 2078
1/31/2002 171 32 19 1/31/2002 708
2/5/2002 79 122 21 2/5/2002 2093
2/6/2002 136 41 14 2/6/2002 1718
2/13/2002 196 72 140 2/13/2002 2124
2/18/2002 165 31 8 2/18/2002 430
3/7/2002 156 4 6 3/7/2002 930
3/8/2002 235 61 18 3/8/2002 998
3/13/2002 156 49 20 3/13/2002 2048
3/14/2002 188 20 12 3/14/2002 550
4/4/2002 197 32 11 167 27 9 4/4/2002 1125 956
4/17/2002 262 128 16 223 109 14 4/17/2002 2127 1808
4/24/2002 178 30 17 151 26 14 4/24/2002 1884 1601
5/2/2002 232 43 5 197 37 4 5/2/2002 523 445
5/8/2002 219 51 5 186 43 4 5/8/2002 2483 2111
5/9/2002 199 43 4 169 37 3 5/9/2002 1206 1025
Average
Claims/Day
Standard
Daily Average Std Deviation Deviation Daily Average Std Deviation
Claims 161 39.68 1431 729.90
RTH 50 30.82
Denials 20 30.04
32
3. General Receiving and Encoding Section – Output Data Health Sector
Reform Technical
Assistance Project
# of Claims # of Re-Encoded Half-Day April/May # of People on Claims per Pax

Date
Encoded Claims Adjustment Adjustment Duty per Day
1/4/2002 821 5 9 91
1/16/2002 2001 37 10 200
1/24/2002 1193 18 10 119
1/30/2002 2276 25 10 228
1/31/2002 2031 64 10 203
2/5/2002 1296 41 10 130
2/6/2002 2036 76 9 226
2/14/2002 861 12 1507 9 167
2/15/2002 1053 26 8 132
2/18/2002 1932 23 9 215
3/7/2002 2222 159 10 222
3/8/2002 1031 79 8 129
3/13/2002 2103 109 10 210
3/14/2002 2010 176 9 223
4/4/2002 1533 89 1303 10 130
4/17/2002 1909 135 1623 9 180
4/24/2002 2291 179 1947 9 216
5/1/2002 2710 162 2304 9 256
5/8/2002 2282 213 1940 8 243
5/9/2002 2895 700 2461 9 273
Daily Average Std Deviation

Claims per pax 189.65 51.62
No. of people 9.25 0.72
Total claims 1,754.50 486.27
No. of re-coded claims 116.40 151.91
33
4. General Receiving and Encoding Section – Output Data Health Sector
Reform Technical
Assistance Project
# of Claims # of Re-Encoded Half-Day April/May # of People on Claims per Pax

Date
Encoded Claims Adjustment Adjustment Duty per Day
1/4/2002 821 5 9 91
1/16/2002 2001 37 10 200
1/24/2002 1193 18 10 119
1/30/2002 2276 25 10 228
1/31/2002 2031 64 10 203
2/5/2002 1296 41 10 130
2/6/2002 2036 76 9 226
2/14/2002 861 12 1507 9 167
2/15/2002 1053 26 8 132
2/18/2002 1932 23 9 215
3/7/2002 2222 159 10 222
3/8/2002 1031 79 8 129
3/13/2002 2103 109 10 210
3/14/2002 2010 176 9 223
4/4/2002 1533 89 1303 10 130
4/17/2002 1909 135 1623 9 180
4/24/2002 2291 179 1947 9 216
5/1/2002 2710 162 2304 9 256
5/8/2002 2282 213 1940 8 243
5/9/2002 2895 700 2461 9 273

Total claims 1,754.50 486.27
No. of re-coded claims 116.40 151.91
34
5. Initial Verification Section – Output Data Health Sector
Reform Technical
Assistance Project
# of Claims # of People on Half-Day April/May # of Claims Verified per

Date
Verified Duty Adjustment Adjustment Pax
1/4/2002 3080 12 257
1/16/2002 1854 9 206
1/24/2002 1605 11 146
1/30/2002 1213 9 135
1/31/2002 1933 10 193
2/5/2002 1468 8 184
2/6/2002 1565 10 157
2/14/2002 750 7 1238 177
2/15/2002 1440 9 160
2/18/2002 1395 8 174
3/7/2002 2071 11 188
3/8/2002 1816 10 182
3/13/2002 2250 10 225
3/14/2002 1657 10 166
4/4/2002 1909 10 1623 162
4/17/2002 1636 9 1391 155
4/24/2002 2310 10 1964 196
5/2/2002 2243 8 1907 238
5/8/2002 2397 10 2037 204
5/9/2002 2605 10 2214 221

Total claims 1,786.05 433.70
35
6. Medical Evaluation Section – Output Data Health Sector
Reform Technical
Assistance Project
# of Claims Half-Day
Date April/May Adjustment # of People on Duty # of Claims per Person
Evaluated Adjustment
1/4/2002 2308 10 231
1/16/2002 1913 9 213
1/24/2002 1593 9 177
1/30/2002 1225 8 153
1/31/2002 1653 10 165
2/5/2002 1799 10 180
2/6/2002 1167 7 167
2/14/2002 925 1619 10 162
2/15/2002 1618 9 180
2/18/2002 1824 10 182
3/7/2002 1028 6 171
3/8/2002 1413 8 177
3/13/2002 1567 9 174
3/14/2002 1796 10 180
4/4/2002 2105 1789 10 179
4/17/2002 1694 none (8 hours) 10 169
4/24/2002 1732 none (8 hours) 10 173
5/2/2002 2208 1877 10 188
5/8/2002 1995 1696 9 188
5/9/2002 2218 1885 10 189

Total claims 1,659.80 288.37
36
7. Adjudication 1 Division, Manual Processing Section – Output Data Health Sector
Reform Technical
Assistance Project
Half Day
Date # of Claims Processed April/May Adjustment # of People on Duty # of Claims per Pax
Adjustment
1/4/2002 1914 10 191
1/16/2002 2148 11 195
1/24/2002 1594 10 159
1/30/2002 1036 10 104
1/31/2002 1294 10 129
2/5/2002 1682 10 168
2/6/2002 1752 11 159
2/14/2002 585 1024 10 102
2/15/2002 1389 1852 11 168
2/18/2002 1750 10 175
3/7/2002 1553 12 129
3/8/2002 755 6 126
3/13/2002 1600 10 160
3/14/2002 1765 12 147
4/4/2002 2123 1805 11 164
4/17/2002 2241 1905 11 173
4/24/2002 2273 1932 12 161
5/2/2002 2486 2113 12 176
5/8/2002 2451 2083 12 174
5/9/2002 1445 1228 9 136

Total claims 1,639.25 387.37
37
8. Adjudication 1 Division, Processing Encoding Section – Output Data Health Sector
Reform Technical
Assistance Project
# of Claims Half day

Date April/May Adjustment # of People on Duty # of Claims per Pax
Encoded Adjustment
1/4/2002 2106 8 263
1/16/2002 1739 8 217
1/24/2002 1338 6 223
1/30/2002 931 5 186
1/31/2002 872 6 145
2/5/2002 1769 7 253
2/6/2002 2157 8 270
2/14/2002 647 1132 8 142
2/15/2002 847 1129 8 141
2/18/2002 1818 8 227
3/7/2002 1227 6 205
3/8/2002 1175 8 147
3/13/2002 866 6 144
3/14/2002 912 6 152
4/4/2002 1477 1255 7 179
4/17/2002 1387 1179 8 147
4/24/2002 1577 1340 8 168
5/2/2002 946 804 7 115
5/8/2002 1176 1000 8 125
5/9/2002 1554 1321 8 165

Total claims 1,303.50 407.67
38
9. Adjudication II Division – Output Data
Health Sector
Reform Technical
Half-Day Adjustment April/May Adjustment Assistance Project
# of Claims Good
Date RTH Denied # People Total Good Total Good # of Claims
Reviewed Claims RTH Denied RTH Denied
Claims Claims Claims Claims per Pax
1/4/2002 1,761 1,683 64 14 19 1683 64 14 93
1/16/2002 2,085 1,962 98 25 19 1962 98 25 110
1/24/2002 2,122 1,873 280 38 18 1873 280 38 118
1/30/2002 1,679 1,372 127 17 17 1372 127 17 99
1/31/2002 1,562 1,422 125 15 18 1422 125 15 87
2/5/2002 1,536 1,417 108 11 19 1417 108 11 81
2/6/2002 1,951 1,724 193 34 19 1724 193 34 103
2/14/2002 777 702 70 5 18 1360 1229 123 9 1360 123 9 43
2/15/2002 876 811 59 6 17 1533 1419 103 11 1533 103 11 52
2/18/2002 1,464 1,301 147 16 17 1301 147 16 86
3/7/2002 1,660 1,318 324 18 18 1318 324 18 92
3/8/2002 1,355 1,169 149 37 19 1169 149 37 71
3/13/2002 1,559 1,213 334 12 18 1213 334 12 87
3/14/2002 1,591 1,307 272 12 20 1307 272 12 80
4/4/2002 1,135 861 251 23 20 965 732 213 20 48
4/17/2002 2,085 1,772 305 8 20 1772 1506 259 7 89
4/24/2002 2,322 1,946 350 26 20 1974 1654 298 22 99
5/1/2002 2,082 1,736 314 32 18 1770 1476 267 27 98
5/8/2002 2,164 1,782 358 24 17 1839 1515 304 20 108
5/9/2002 2,404 1,688 350 21 17 2043 1435 298 18 120
Ave # of People/Day 18.40 Ave Claims Pax/Day 88.20

Standard Deviation 1.10 Standard Deviation 21.45
Ave Total Claims/Day 1,679.05 Ave Good Claims/Day 1,448.60
Standard Deviation 285.12 Standard Deviation 266.95
Ave RTH/Day 204.30
Standard Deviation 89.39
Ave Denied/Day 19.15
Standard Deviation 9.02
39
Health Sector
Reform Technical
10. Voucher Review 1 (Accounts Payable I - Adjudication 2 Div) – Output Data Assistance Project
# of Claims Overtime Half-Day April/May # of People Full # of Claims per

Date
Reviewed Adjustment Adjustment Adjustment Time Pax
1/4/2002 851 6 142
1/16/2002 1076 861 7 123
1/24/2002 1022 818 7 117
1/30/2002 780 7 111
1/31/2002 691 7 99
2/5/2002 707 6 118
2/6/2002 840 7 120
2/14/2002 442 774 4 194
2/15/2002 310 543 4 136
2/18/2002 834 7 119
3/7/2002 882 8 110
3/8/2002 336 4 84
3/13/2002 707 6 118
3/14/2002 709 7 101
4/4/2002 512 435 4 109
4/17/2002 690 587 5 117
4/24/2002 769 654 5 131
5/1/2002 796 677 5 135
5/8/2002 998 848 7 121
5/9/2002 931 791 7 113

Total claims 716.25 147.46
40
Health Sector
Reform Technical
11. Voucher Review 2 (Accounts Payable 2 - Adjudication 2 Div) – Output Data Assistance Project
# of Claims Overtime Half-Day April/May # of People Full # of Claims per

Date
Reviewed Adjustment Adjustment Adjustment Time Pax
1/4/2002 980 8 123
1/16/2002 1402 1122 7 160
1/24/2002 1111 889 7 127
1/30/2002 759 7 108
1/31/2002 622 6 104
2/5/2002 644 5 129
2/6/2002 748 6 125
2/14/2002 362 634 4 159
2/15/2002 429 751 4 188
2/18/2002 724 6 121
3/7/2002 949 8 119
3/8/2002 707 6 118
3/13/2002 597 4 149
3/14/2002 764 7 109
4/4/2002 782 665 6 111
4/17/2002 391 332 3 111
4/24/2002 701 596 6 99
5/1/2002 870 740 7 106
5/8/2002 1135 965 8 121
5/9/2002 1043 887 8 111

Total claims 753.75 175.92
41
12. Disbursement 1 – Output Data Health Sector
Reform Technical
Assistance Project
# of # of
# of ACs April/May # of ACs # of Checks April/May # of Total # of April/ May
Date People Who Checks/
Reviewed Adjstmnt Pax Prepared Adjstmnt People Claims Paid Adjstmnt
Reviewed Person
1/4/2002 1101 3 367 482 2 241 1398
1/16/2002 1527 3 509 819 2 410 2246
1/24/2002 1211 3 404 505 2 253 1258
1/30/2002 1274 3 425 545 2 273 1439
1/31/2002 1092 3 364 695 2 348 1562
2/5/2002 979 3 326 721 2 361 1426
2/6/2002 1342 3 447 680 2 340 1569
2/13/2002 1393 3 464 827 2 414 1570
2/18/2002 975 3 325 1096 2 548 1810
3/7/2002 794 3 265 544 2 272 1038
3/8/2002 613 3 204 809 2 405 1770
3/13/2002 874 3 291 512 2 256 1075
3/14/2002 590 3 197 568 2 284 1062
4/4/2002 1051 893 3 298 562 478 2 239 1387 1179
4/17/2002 1165 990 3 330 559 475 2 238 1521 1293
4/24/2002 678 576 3 192 498 423 2 212 1361 1157
5/1/2002 570 485 3 162 576 490 2 245 1658 1409
5/8/2002 1366 1161 3 387 855 727 2 364 2485 2112
5/9/2002 1319 1121 3 374 863 734 2 367 2233 1898
Ave ACs Pax /Day 333.21 Ave Checks Pax/Day 319.47 Ave Total
Standard Deviation 98.13 Standard Deviation 86.40 # of Claims Paid 1,487.95
Per Day
Std Deviation 350.01
42
Health Sector
IV. Costing of NCR Current Work Flows

Reform Technical
Assistance Project
1. Summary of Claims Processing Costs
DIVISION/SECTION Personnel Supplies Rent & Utilities Occupancy Services Equipment Dep'n IT Support Others Total
OFC OF THE DEPT MGR 1,276,623 42,813 424,948 84,548 61,610 25,708 313,000 2,229,251
PMAC 1,741,778 54,625 642,131 182,475 32,020 61,947 3,125 2,718,102
Gen Recvng/Encoding 1,885,516 117,317 233,150 46,549 165,130 228,019 3,125 2,678,806
Verification 1,645,243 58,658 233,150 46,549 12,920 3,300 3,125 2,002,945
Medical Evaluation Unit 3,313,518 45,986 402,700 84,548 26,400 5,939 3,125 3,882,217
ADJUDICATION I DIVISION
Adjustment/CRU/Legal 927,869 143,990 227,902 46,549 59,357 56,467 3,125 1,465,259
Manual Processing 2,121,176 143,990 161,221 30,399 7,677 7,690 3,125 2,475,278
Processing Encoding 1,428,589 143,990 161,221 30,399 192,277 211,980 3,125 2,171,581
ADJUDICATION II DIVISION
Review I 2,035,170 216,396 161,221 30,399 10,997 7,690 3,125 2,464,998
Review II 1,985,670 216,396 161,221 30,399 10,997 7,690 3,125 2,415,498
Payment Approval 906,395 216,396 161,221 30,399 96,487 109,835 3,125 1,523,858
ACCOUNTING DIVISION
Accounts Payable I 131,127 132,001 259,844 50,666 23,255 8,407 36,125 641,425
Accounts Payable II 1,492,346 132,001 227,902 46,549 32,805 11,047 36,126 1,978,776
Disbursement I 2,652,132 132,001 259,844 317 92,695 92,763 36,125 3,265,876
Disbursement II 1,900,764 132,001 1 50,666 50,215 13,686 36,125 2,183,458
INFORMATION/ADMIN DIVISION
Admin Section 1,366,788 35,718 257,650 51,774 103,240 126,534 3,125 1,944,829
Information Section 1,088,587 35,718 257,650 51,774 80,970 52,737 3,125 1,570,561
Total: 27,899,292 2,000,000 4,232,976 894,962 1,059,050 1,031,438 495,001 37,612,718

Percent of total cost: 74% 5% 11% 2% 3% 3% 1% 100%
43
2. Unit Outpost Cost per Section Health Sector
Reform Technical
Assistance Project
No. of working days per year: 247

Allocation of ODM Costs to lower levels
DIVISION/SECTION Average Actual Total Cost From ODM to From Div to Allocated ODM Final Section Cost per Output Ave. Output Cost per unit
Personnel Divisions Sections Costs Costs Day per day of Output
OFC OF THE DEPT MGR
(ODM) 3 2,229,251
RECVNG/VERIF/MED DIVISION 20.0%

PMAC 10 2,718,102 5.0% 111,463 2,829,564 11,456 Claims received 1,755 6.53
Gen Recvng/Encoding 11 2,678,806 5.0% 111,463 2,790,269 11,297 Claims encoded 1,755 6.44
Verification 11 2,002,945 5.0% 111,463 2,114,408 8,560 Claims encoding verified 1,786 4.79
Medical Evaluation Unit 11 3,882,217 5.0% 111,463 3,993,679 16,169 Claims evaluated 1,660 9.74
ADJUDICATION I DIVISION 20.0%

Adjustment/CRU/Legal 4 1,465,259 6.7% 148,617 1,613,875 6,534
Manual Processing 13 2,475,278 6.7% 148,617 2,623,895 10,623 Claims amount computed 1,639
Processing Encoding 9 2,171,581 6.7% 148,617 2,320,198 9,394 Processed Claims encoded 1,304
ADJUDICATION II DIVISION 20.0%

Review I 11 2,464,998 6.7% 148,617 2,613,615 10,581 Claims validated/ reviewed 1,679
Review II 11 2,415,498 6.7% 148,617 2,564,115 10,381 1,679
Payment Approval 5 1,523,858 6.7% 148,617 1,672,474 6,771 1,679
ACCOUNTING DIVISION 20.0%

Accounts Payable I 7 641,425 5.0% 111,463 752,888 3,048 716
Accounts Payable II 7 1,978,776 5.0% 111,463 2,090,239 8,463 754
Disbursement I 15 3,265,876 5.0% 111,463 3,377,339 13,673
Disbursement II 11 2,183,458 5.0% 111,463 2,294,921 9,291
INFORMATION/ADMIN DIVISION 20.0%

Admin Section 7 1,944,829 10.0% 222,925 2,167,754 8,776
Information Section 6 1,570,561 10.0% 222,925 1,793,486 7,261
Total: 152 37,612,718 100% 100% 2,229,251 37,612,718

Add: Division chiefs
(allocated) 5
Grand Total: 157
44
3. Summary of Assumptions, Claims Processing Division (NCR) Health Sector
Reform Technical
Assistance Project
(Accenture) (CPG Study)

Output per Pax
Output/Activities Value Value
per day
Number of working days in a year 247.00 247.00
Number of working hours in a day 7.00 7.00
Number of working minutes in an hour 60.00 60.00
Percentage of time used in involvement to Administrative concern 0.05 0.05
Number of received claims per day 1,600.00 1,755.00

Number of Claims Received per day (General) 92% of total received claims 1,472.00 1,614.60
Number of claims Received per day (Direct file) 8% of total received claims 128.00 140.40
Number of claims for re-encoding per day (10% of received claims) 160.00
Number of minutes required to receive one claim (General) 1.40 1.40
Number of minutes required to receive and screen one directly filed claim 15.00 15.00
Number of minutes required to verify one claim 2.10 2.26 186.00
Number of minutes required to encode one received claim 2.80 2.21 190.00
Number of minutes required to evaluate one claim 2.80 2.33 180.00
Number of minutes required to manually compute one claim 2.80 2.71 155.00
Number of minutes required to encode one processed claim 2.10 2.32 181.00
Number of minutes required to validate and review one claim 5.25 4.77 88.00
Number of minutes required to re-encode one claim 1.40
Number of minutes required to generate payment approval for one claim 0.46
Number of Vouchers for correction per day 50.00 185.00
Number of minutes required to correct one voucher 7.00 2.27 185.00
Number of minutes required to generate one payment notice 0.47
Number of minutes required to encode Return To Hospital (RTH) communication 2.10 1.88 223.00
Number of minutes required to review one vouchered claim 4.20 3.47 121.00
Number of minutes required to prepare one check 0.42 1.32 319.00
Number of minutes required for initial review of one check 1.05
Number of minutes required to post one Auto Credit Payment 0.21
1.26 333.00
Number of minutes required to review one Auto Credit Payment 1.05
Number of minutes required for final review of one check 1.05
45
(Accenture) (CPG Study)
Output per Pax Health Sector
Output/Activities Value Value
per day
Reform Technical
Assistance Project
Number of minutes required to sort one claim 0.84

Number of Withholding Tax Certificate to be prepared per year 28,000.00 ???
Number of minutes required to prepare one Withholding Tax Certificate 3.16
Number of claims retrieved for adjustment per year 2,400.00 7,944.00
Number of minutes required to retrieve one claim for adjustment 8.40
Number of minutes required to prepare one claim for Commission On Audit (COA) filing 0.42
Number of minutes required to stamp "paid" to one claim and attach documents 1.40
Number of walk-in clients per day 136.00
Number of Phone-inquiries per day 705.00
Number of minutes required to handle Phone-inquiries 5.00
Number of minutes required to accommodate Walk-in clients 15.00
Number of minutes required to prepare one claim for RTH 4.20
Number of Auto-Credit Payment posted per day 1,200.00 999.00
Number of claims for RTH (8% of received claims) 128.00 223.00
Number of payment notices to be distributed per day 6,500.00 ?? More than # of claims received
Number of minutes required to prepare and distribute one payment notice 0.42
Number of checks prepared per day 638.00
Percent of time devoted to performance of administrative functions/duties 5.00%
46
4. Cost of Personnel (2002)
SALARY EDUCNL 13TH MO. & OTHERS GRAND

UNIT R/C # UNIFORM BONUS TOTAL
SG BASIC ACA/PERA TOTAL/MO TOTAL/YR. ASSTNCE CASH GIFT GSIS ECIP PHIC PAGIBIG TOTAL TOTAL
OFFICE OF THE DEPT MGR

Dept Manager A R 1 26 48,045 5,000 53,045 636,540 4,000 53,045 40,000 53,045 150,090 69,185 270 1,500 1,200 72,155 858,785
Clerk III R 1 6 9,781 5,000 14,781 177,372 4,000 14,781 40,000 14,781 73,562 14,085 270 1,500 1,200 17,055 267,989
Administrative Assistant I C 1 10 9,988 0 9,988 119,856 0 4,994 25,000 0 29,994 0 0 0 0 0 149,850
TOTAL (OFC OF THE DEPT MGR) 3 933,768 8,000 72,820 105,000 67,826 253,646 83,269 540 3,000 2,400 89,209 1,276,623
RECEIVING/VERIF/MEDICAL
Division Chief R 1 24 29,004 5,000 34,004 408,048 4,000 34,004 40,000 34,004 112,008 41,766 270 1,500 1,200 44,736 564,792
PMAC
Section Chief R 1 8 11,466 5,000 16,466 197,592 4,000 16,466 40,000 16,466 76,932 16,511 270 1,500 1,200 19,481 294,005
Claims Processor I C 1 11 10,582 0 10,582 126,984 0 5,291 25,000 0 30,291 0 0 0 0 0 157,275
Asst Claims Processor I C 3 8 8,756 0 8,756 315,216 0 13,134 75,000 0 88,134 0 0 0 0 0 403,350
Information Officer II C 2 15 13,354 0 13,354 320,496 0 13,354 50,000 0 63,354 0 0 0 0 0 383,850
Data Encoder I C 1 6 7,656 0 7,656 91,872 0 3,828 25,000 0 28,828 0 0 0 0 0 120,700
Clerk III C 2 6 7,656 0 7,656 183,744 0 7,656 50,000 0 57,656 0 0 0 0 0 241,400
TOTAL (PMAC) 10 1,235,904 4,000 59,729 265,000 16,466 345,195 16,511 270 1,500 1,200 19,481 1,600,580
GEN RECEIVING/ENCODING
Section Chief R 1 11 14,064 5,000 19,064 228,768 4,000 19,064 40,000 19,064 82,128 20,252 270 1,500 1,200 23,222 334,118
Asst Claims Processor I C 8 8 8,756 0 8,756 840,576 0 35,024 200,000 0 235,024 0 0 0 0 0 1,075,600
Data Encoder I C 2 6 7,656 0 7,656 183,744 0 7,656 50,000 0 57,656 0 0 0 0 0 241,400
Clerk III C 2 6 7,656 0 7,656 183,744 0 7,656 50,000 0 57,656 0 0 0 0 0 241,400
TOTAL (GEN RCVG/ENCDNG) 13 1,436,832 4,000 69,400 340,000 19,064 432,464 20,252 270 1,500 1,200 23,222 1,892,518
VERIFICATION
Section Chief R 1 8 11,466 5,000 16,466 197,592 4,000 16,466 40,000 16,466 76,932 16,511 270 1,500 1,200 19,481 294,005
Asst Claims Processor I C 9 8 8,756 0 8,756 945,648 0 39,402 225,000 0 264,402 0 0 0 0 0 1,210,050
TOTAL (VERIFICATN) 10 1,143,240 4,000 55,868 265,000 16,466 341,334 16,511 270 1,500 1,200 19,481 1,504,055
47
MEDICAL EVALUATION
Section Chief R 1 20 23,834 5,000 28,834 346,008 4,000 28,834 40,000 28,834 101,668 34,321 270 1,500 1,200 37,291 484,967
Medical Officer IV R 3 20 23,834 5,000 28,834 1,038,024 4,000 86,502 40,000 86,502 217,004 102,963 810 4,500 3,600 111,873 1,366,901
Medical Officer IV C 6 20 17,864 0 17,864 1,286,208 0 53,592 150,000 0 203,592 0 0 0 0 0 1,489,800
TOTAL (MED EVALTN) 11 2,775,312 8,000 173,306 255,000 115,336 551,642 137,284 1,080 6,000 4,800 149,164 3,476,118
TOTAL (RCVG/VERIF/MDICAL) 45 6,999,336 24,000 392,307 1,165,000 201,336 1,782,643 232,324 2,160 12,000 9,600 256,084 9,038,063
ADJUDICATION 1
Division Chief R 1 18 21,273 5,000 26,273 315,276 4,000 26,273 40,000 26,273 96,546 30,633 270 1,500 1,200 33,603 445,425
ADJUSTMENT/CRU/LEGAL
Section Chief R 1 11 14,064 5,000 19,064 228,768 4,000 19,064 40,000 19,064 82,128 20,252 270 1,500 1,200 23,222 334,118
Asst Claims Processor I R 1 8 11,466 5,000 16,466 197,592 4,000 16,466 40,000 16,466 76,932 16,511 270 1,500 1,200 19,481 294,005
Asst Claims Processor II C 2 10 9,988 0 9,988 239,712 0 9,988 50,000 0 59,988 0 0 0 0 0 299,700
TOTAL (ADJ/CRU/LEGAL) 4 666,072 8,000 45,518 130,000 35,530 219,048 36,763 540 3,000 2,400 42,703 927,823
MANUAL PROCESSING
Section Chief R 1 11 14,064 5,000 19,064 228,768 4,000 19,064 40,000 19,064 82,128 20,252 270 1,500 1,200 23,222 334,118
Claims Processor II C 1 13 11,902 0 11,902 142,824 0 5,951 25,000 0 30,951 0 0 0 0 0 173,775
TOTAL (MAN PROCESSING) 13 1,629,816 4,000 77,441 340,000 19,064 440,505 20,252 270 1,500 1,200 23,222 2,093,543
PROCESSING ENCODING
Section Chief R 1 11 14,064 5,000 19,064 228,768 4,000 19,064 40,000 19,064 82,128 20,252 270 1,500 1,200 23,222 334,118
Data Encoder I C 4 6 7,656 0 7,656 367,488 0 15,312 100,000 0 115,312 0 0 0 0 0 482,800
TOTAL (PROCSSNG ENCDNG) 9 1,038,456 4,000 52,801 240,000 19,064 315,865 20,252 270 1,500 1,200 23,222 1,377,543
TOTAL (ADJUDICATION1) 27 3,649,620 20,000 202,033 750,000 99,931 1,071,964 107,901 1,350 7,500 6,000 122,751 4,844,335
ADJUDICATION 2
48
Division Chief R 1 22 26,395 5,000 31,395 376,740 4,000 31,395 40,000 31,395 106,790 38,009 270 1,500 1,200 40,979 524,509
REVIEW1
Section Chief R 1 11 14,064 5,000 19,064 228,768 4,000 19,064 40,000 19,064 82,128 20,252 270 1,500 1,200 23,222 334,118
Claims Processor II C 9 13 11,902 0 11,902 1,285,416 0 53,559 225,000 0 278,559 0 0 0 0 0 1,563,975
TOTAL (REVIEW1) 12 1,746,240 4,000 82,292 315,000 19,064 420,356 20,252 270 1,500 1,200 23,222 2,189,818
REVIEW2
Section Chief R 1 11 14,064 5,000 19,064 228,768 4,000 19,064 40,000 19,064 82,128 20,252 270 1,500 1,200 23,222 334,118
TOTAL (REVIEW2) 12 1,682,880 4,000 79,652 315,000 19,064 417,716 20,252 270 1,500 1,200 23,222 2,123,818
PAYMENT APPROVAL
Clerk III C 1 6 7,656 0 7,656 91,872 0 3,828 25,000 0 28,828 0 0 0 0 0 120,700
Administrative Officer I C 1 11 10,582 0 10,582 126,984 0 5,291 25,000 0 30,291 0 0 0 0 0 157,275
TOTAL (PAYMNT APPRVAL) 6 682,968 0 28,457 150,000 0 178,457 0 0 0 0 0 861,425
TOTAL (ADJUDICATION2) 31 4,488,828 12,000 221,796 820,000 69,523 1,123,319 78,513 810 4,500 3,600 87,423 5,699,570
ACCOUNTING
Division Chief R 1 22 26,395 5,000 31,395 376,740 4,000 31,395 40,000 31,395 106,790 38,009 270 1,500 1,200 40,979 524,509
ACCOUNTS PAYABLE I
Section Chief R 1 15 17,727 5,000 22,727 272,724 4,000 22,727 40,000 22,727 89,454 25,527 270 1,500 1,200 28,497 390,675
TOTAL (ACCTS PAYABLE I) 9 1,367,796 4,000 68,355 240,000 22,727 335,082 25,527 270 1,500 1,200 28,497 1,731,375
49
ACCOUNTS PAYABLE II
Section Chief R 1 18 21,273 5,000 26,273 315,276 4,000 26,273 40,000 26,273 96,546 30,633 270 1,500 1,200 33,603 445,425
Claims Processor II C 7 13 11,902 0 11,902 999,768 0 41,657 175,000 0 216,657 0 0 0 0 0 1,216,425
TOTAL (ACCTS PAYABLE II) 9 1,442,028 4,000 73,221 240,000 26,273 343,494 30,633 270 1,500 1,200 33,603 1,819,125
DISBURSEMENT I
Section Chief R 1 18 21,273 5,000 26,273 315,276 4,000 26,273 40,000 26,273 96,546 30,633 270 1,500 1,200 33,603 445,425
TOTAL (DISBURSEMENT I) 15 2,114,172 4,000 101,227 390,000 26,273 521,500 30,633 270 1,500 1,200 33,603 2,669,275
DISBURSEMENT II
Section Chief R 1 16 18,909 5,000 23,909 286,908 4,000 23,909 40,000 23,909 91,818 27,229 270 1,500 1,200 30,199 408,925
Accounting Clerk III R 1 8 11,466 5,000 16,466 197,592 4,000 16,466 40,000 16,466 76,932 16,511 270 1,500 1,200 19,481 294,005
Clerk III C 1 6 7,656 0 7,656 91,872 0 3,828 25,000 0 28,828 0 0 0 0 0 120,700
Supply Assistant C 1 8 8,756 0 8,756 105,072 0 4,378 25,000 0 29,378 0 0 0 0 0 134,450
TOTAL (DISBURSEMENT II) 7 996,660 8,000 61,715 205,000 40,375 315,090 43,740 540 3,000 2,400 49,680 1,361,430
TOTAL (ACCOUNTING) 41 6,297,396 24,000 335,913 1,115,000 147,043 1,621,956 168,542 1,620 9,000 7,200 186,362 8,105,714
INFORMATION/ADMIN
Division Chief R 1 22 26,395 5,000 31,395 376,740 4,000 31,395 40,000 31,395 106,790 38,009 270 1,500 1,200 40,979 524,509
ADMIN SECTION
Section Chief R 1 11 14,064 5,000 19,064 228,768 4,000 19,064 40,000 19,064 82,128 20,252 270 1,500 1,200 23,222 334,118
Data Encoder I C 1 6 7,656 0 7,656 91,872 0 3,828 25,000 0 28,828 0 0 0 0 0 120,700
Information Officer II C 1 15 13,354 0 13,354 160,248 0 6,677 25,000 0 31,677 0 0 0 0 0 191,925
Clerk III C 1 6 7,656 0 7,656 91,872 0 3,828 25,000 0 28,828 0 0 0 0 0 120,700
Administrative Officer I C 1 11 10,582 0 10,582 126,984 0 5,291 25,000 0 30,291 0 0 0 0 0 157,275
50
TOTAL (ADMIN SECTION) 7 947,640 4,000 49,017 190,000 19,064 262,081 20,252 270 1,500 1,200 23,222 1,232,943
INFORMATION SECTION
Section Chief C 1 11 10,582 0 10,582 126,984 0 5,291 25,000 0 30,291 0 0 0 0 0 157,275
TOTAL (INFO SECTION) 6 777,744 0 32,406 150,000 0 182,406 0 0 0 0 0 960,150
TOTAL (INFORMATION/ADMIN) 14 2,102,124 8,000 112,818 380,000 50,459 551,277 58,261 540 3,000 2,400 64,201 2,717,602
GRAND TOTAL 161 24,471,072 96,000 1,337,687 4,335,000 636,118 6,404,805 728,810 7,020 39,000 31,200 806,030 31,681,907
51
5. Personnel Costs by Section (2002) – (Allocation Method: Step down from Division Chiefs to Sections)
Direct workforce Support workforce Allocate Div Chief Cost to Sections

One-time Qty* Total Cost Actual Average Qty** Average cost ex. Section chief Actual Qty Sec Chief &/or Clerks Total Actual Average Cost % of Sections w/in each Div Allocated Costs New Sect Cost
Office of the Dept Mgr (ODM) 3 1,276,623 1,276,623
Receiving/Verif/Medical
Division Chief 1 564,792
PMAC 10 1,600,580 9 145,175 1 294,005 1,600,580 25% 141,198 1,741,778
Gen Rcvg & Encdg 13 1,892,518 9 129,867 2 575,518 1,744,318 25% 141,198 1,885,516
Verification 10 1,504,055 10 121,004 1 294,005 1,504,045 25% 141,198 1,645,243
Medical Evaluation 11 3,476,118 10 303,787 1 134,450 3,172,320 25% 141,198 3,313,518
Adjudication 1
Adjustment/Cru/Legal 4 927,823 3 148,425 1 334,118 779,394 33% 148,475 927,869
Manual Processing 13 2,093,543 11 135,339 2 483,968 1,972,701 33% 148,475 2,121,176
Processing/Encoding 9 1,377,543 7 115,935 2 468,568 1,280,114 33% 148,475 1,428,589
Adjudication 2
Review 1 12 2,189,818 9 154,641 2 468,568 1,860,334 33% 174,836 2,035,170
Review 2 12 2,123,818 9 149,141 2 468,568 1,810,834 33% 174,836 1,985,670
Payment Approval 6 861,425 4 143,571 1 157,275 731,558 33% 174,836 906,395
Accounting
Accounts Payable I 1 1,731,375 6 1,340,699 1 390,675 25% 131,127 131,127
Accounts Payable II 9 1,819,125 6 152,632 1 445,425 1,361,219 25% 131,127 1,492,346
Disbursement I 15 2,669,275 14 148,256 1 445,425 2,521,004 25% 131,127 2,652,132
Disbursement II 7 1,361,430 10 136,071 1 408,925 1,769,636 25% 131,127 1,900,764
Info/Admin
Admin 7 1,232,943 6 128,403 1 334,118 1,104,534 50% 262,254 1,366,788
Information 6 960,150 5 133,812 1 157,275 826,333 50% 262,254 1,088,587
Grand Total: 153 31,681,907 128 3,586,757 21 5,860,887 24,038,925 2,583,743 27,899,292
Source: Interviews with division/section chiefs, April-May 2002

* Quantity based on actual count conducted from April 24, 2002
** Quantity based on sampling of 20 days from Jan 2, 2002 to May 10, 2002.
52
6. Cost of Supplies
APR MAY JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR Add TOTAL
DIVISION/SECTION 2001 2001 2001 2001 2001 2001 2001 2001 2001 2002 2002 2002 ANNUAL
OFC OF DEPT. MGR 0 0 0 0 0 0 0 0 0 524 0 0 0 524
RECVNG/VERIF/MED DIV 31,316 23,332 8,587 18,364 6,866 26,949 11,701 14,828 2,857 23,765 1,512 2,264 78,220 250,561
PMAC Section 19,329 13,390 1,896 4,299 1,643 1,276 692 3,254 1,326 0 701 1,680 0 49,485
Gen Rec/Enc/Ver Sects 11,115 9,637 6,279 13,373 4,684 21,201 10,173 11,302 829 17,952 288 584 52,000 159,416
Medical Evaluation Unit 872 305 413 692 539 4,472 837 272 701 5,813 523 0 26,220 41,659
ADJUDICATION I DIV 10,418 6,831 9,726 24,074 26,141 37,111 22,185 11,235 15,668 109,382 6,328 21,595 90,630 391,324
ADJUDICATION II DIV 29,041 47,226 62,791 48,744 60,012 36,885 33,985 38,139 17,682 88,430 54,558 0 70,610 588,102
ACCOUNTING DIV 21,921 24,520 26,491 46,579 22,089 43,530 48,322 39,516 13,670 37,336 15,746 5,531 133,070 478,322
INFO/ADMIN DIV 0 1,932 8,354 5,801 2,706 2,885 682 25 0 1,918 0 0 40,410 64,714
OTHERS 28,000 8,081 2,180 0 38,261
TOTAL 92,695 103,841 115,949 143,562 117,813 147,361 116,875 103,744 49,876 289,356 86,225 31,570 412,940 1,811,807
% Distribution by Month 5.1% 5.7% 6.4% 7.9% 6.5% 8.1% 6.5% 5.7% 2.8% 16.0% 4.8% 1.7% 22.8% 100.0%
Annual Total 1 2002 Budget 2,000,000

OFC OF DEPT. MGR 524 0% 579 Source: April-Dec 2001
RECVNG/VERIF/MED DIV Tally of Request Form for Supplies
PMAC Section 49,485 3% 54,625 Jan-Mar 2002
Gen Rec/Enc/Ver Sects 159,416 9% 175,975 Mr. Ruel Dalupan, Info/Admin Div
Medical Evaluation Unit 41,659 2% 45,986
ADJUDICATION I DIV 391,324 22% 431,971
ADJUDICATION II DIV 588,102 32% 649,188
ACCOUNTING DIV 478,322 26% 528,005
INFO/ADMIN DIV 64,714 4% 71,435
OTHERS 38,261 2% 42,235
Total 1,811,807 100% 2,000,000
53
7. Occupancy Costs 1 and 2
ROOM Common Elec

DIVISION/SECTION
ASSIGNMENT Area (Sq. M.) RENT Annual ELEC. Annual Annual WATER Annual TEL. Annual TOTAL Annual
OFC OF THE DEPT MGR 1411 89 293,700 71,426 36,300 1,517 22,004 424,948
PMAC Grd. Floor 82 492,000 112,339 36,632 1,160 0 642,131
Gen Recvng/Encoding 1403 98 161,700 42,316 19,986 1,052 8,096 233,150
Verification 1403 98 161,700 42,316 19,986 1,052 8,096 233,150
Medical Evaluation Unit 1404 89 293,700 71,474 36,300 1,225 0 402,700
Adjustment/CRU/Legal 1412 98 161,700 33,872 19,986 2,065 10,279 227,902
Manual Processing 1402 160 105,600 38,168 13,052 919 3,482 161,221
Processing Encoding 1402 160 105,600 38,168 13,052 919 3,482 161,221
Review I 1402 160 105,600 38,168 13,052 919 3,482 161,221
Review II 1402 160 105,600 38,168 13,052 919 3,482 161,221
Payment Approval 1402 160 105,600 38,168 13,052 919 3,482 161,221
ACCOUNTING DIVISION
Accounts Payable I 1401 160 176,000 55,003 21,753 1,284 5,804 259,844
Accounts Payable II 1412 98 161,700 33,872 19,986 2,065 10,279 227,902
Disbursement I 1401 160 176,000 55,003 21,753 1,284 5,804 259,844
Disbursement II 1401 1 1,100 55,003 136 1,284 5,804 63,327
Admin Section 1410 109 179,850 46,256 22,229 610 8,705 257,650
Information Section 1410 109 179,850 46,256 22,229 610 8,705 257,650
TOTAL 2,967,000 855,977 342,535 18,817 110,987 4,296,302

Monthly rent per sq. m. 275 pesos Common Elec Annual Costs (PHIC) 4,835,404
Common Elec Annual Costs (14th floor) 586,110
Total floor area (14th floor) 1,437
54
8. Occupancy Costs 3
DIVISION/SECTION
ROOM ASSIGNMENT Area (Sq. M.) Janitorial Annual Security Annual Eng'g Annual TOTAL Annual Eqpt Depn Annual
OFC OF THE DEPT MGR 1411 89 44,248 31,215 9,085 84,548 61,610
PMAC Grd. Floor 82 84,000 89,307 9,168 182,475 32,020
Gen Recvng/Encoding 1403 98 24,361 17,186 5,002 46,549 165,130
Verification 1403 98 24,361 17,186 5,002 46,549 12,920
Medical Evaluation Unit 1404 89 44,248 31,215 9,085 84,548 26,400
Adjustment/CRU/Legal 1412 98 24,361 17,186 5,002 46,549 59,357
Manual Processing 1402 160 15,909 11,223 3,267 30,399 7,677
Processing Encoding 1402 160 15,909 11,223 3,267 30,399 192,277
Review I 1402 160 15,909 11,223 3,267 30,399 10,997
Review II 1402 160 15,909 11,223 3,267 30,399 10,997
Payment Approval 1402 160 15,909 11,223 3,267 30,399 96,487
ACCOUNTING DIVISION
Accounts Payable I 1401 160 26,516 18,706 5,444 50,666 23,255
Accounts Payable II 1412 98 24,361 17,186 5,002 46,549 32,805
Disbursement I 1401 1 166 117 34 317 92,695
Disbursement II 1401 160 26,516 18,706 5,444 50,666 50,215
Admin Section 1410 109 27,096 19,115 5,563 51,774 103,240
Information Section 1410 109 27,096 19,115 5,563 51,774 80,970
TOTAL 456,877 352,355 85,730 894,962 1,059,050
Costs of Janitorial and Security Services

Cost of Janitorial Service in 14th floor 59,536 per month (See Note 1 below)
Cost of Security Service in 14th floor 42,000 per month (See Note 2 below)
No. of Janitors in PMAC 2
Cost per Janitor 14,000 per month
No. of Security Personnel in PMAC 3
Cost per Security Personnel 9,923 per month
Total floor area (14th floor) 1,437 sq mtrs (Excludes common areas)
Engineering Costs Monthly Annual
55
DIVISION/SECTION
ROOM ASSIGNMENT Area (Sq. M.) Janitorial Annual Security Annual Eng'g Annual TOTAL Annual Eqpt Depn Annual
Cost of Personnel for Maintenance of air handling units 34,916 418,993 (See Note 3)
Cost of Personnel for other engineering services 33,623 403,476 (See Note 4)
Cost of Parts replaced (average) 7,812 93,744
Every other
Month Annual
Cost of descaling of air handling units 24,500 147,000
Cost of Cleaning of pipes 24,500 147,000
Total Engr Costs Annual 1,210,213
14th Floor allocation 146,692
N O T E S:
No. per floor No. of floors Cost per Total per Notes
month month
1 Janitorial 6 1 9,923 59,536 4 in 1st shift (7am-4pm; 2 in 2nd shift (10am-7pm)
2 Security 3 1 14,000 42,000 1 guard per floor at any time; 3 shifts a day
3 Maintenance of air handling units
Qty Type Cost per Total per Notes
month month
3 Engineers Reg 4,216 12,647P511/day; 2:30-5:30pm; 22 days/month
3 Engineers OT 5,270 15,809P511/day X 125%; 5:30-8:30pm; 22 days/month
1 Aircon technician Reg 2,871 2,871P348/day; 2:30-5:30pm; 22 days/month
1 Aircon technician OT 3,589 3,589P348/day X 125%; 5:30-8:30pm; 22 days/month
Total: 34,916
4 Other engineering services (replace light bulbs, transfer phone lines, repair electrical connections, etc.)
Qty Type Cost per Total per Notes
month month
3 Engineers Reg 9,134 27,402P511/day; 8:00-2:30pm; 22 days/month
1 Aircon technician Reg 6,221 6,221P348/day; 8:00-2:30pm; 22 days/month
Total: 33,623
56
9. Equipment Depreciation Costs
Ofc of the Rcv/Verif/Med Div Adjudication1 Div Adjudication2 Div Accounting Div Info/Admin Div
Price Manager Chief PMAC Rcv/Enc Verif Med Chief Adj/Leg ManProc ProcEnc Chief Rev1 Rev2 PayApp Chief AccPay1 AccPay2 Disb1 Disb2 Chief Admin Info
COMPUTER 47,750 3 1 3 12 1 2 2 5 10 2 5 2 1 2 6 3 1 7 6
PRINTER
Epson 2070 19,650 1 12 1 1 1 1 2 1 1 4 3 1 5 1
HP Laserjet 4000 49,800 1 1 3
HP Laserjet 4050 49,500 9 1
OTHER EQUIPMENT:
Photocopier 100,000 1 1 1
Fax Machine 15,000 1 1
DEPRECIATION (5-year SL) 61,610 13,480 28,650 161,760 9,550 23,030 23,030 51,680 0 184,600 32,990 0 0 85,490 39,100 13,480 23,030 82,920 40,440 33,480 86,500 64,230
Distribute Chief 25% 25% 25% 25% 33% 33% 33% 33% 33% 33% 25% 25% 25% 25% 50% 50%
3,370 3,370 3,370 3,370 7,677 7,677 7,677 10,997 10,997 10,997 9,775 9,775 9,775 9,775 16,740 16,740
New Total 32,020 165,130 12,920 26,400 59,357 7,677 192,277 10,997 10,997 96,487 23,255 32,805 92,695 50,215 103,240 80,970
57
10. IT Support Costs
Cost of Maintaining and Operating Unified Claims Processing System (UCPS)
Qty Type Sal Grade Annual Comp Total Annual Comp Notes
1 Systems Analyst 18 445,425 445,425 Analysis, programming, planning, documentation
1.5 Operator 15 390,675 586,013 Reindexing, file back-up, hardware support
Total: 1,031,438
NOTE: UCPS was developed by Jay Bernolia in 1998 using Clipper & other shareware, in two weeks. For costing purposes, the cost of developing UCPS has been fully recovered and will not be
allocated.
Total # of Networked % of Total Networked Hardware Systems Analysis % of Sections Allocated New Sect
DIVISION/SECTION Computers Computers Computers Support & Oper.
Total
w/in each Div Costs Cost
OFC OF THE DEPT MGR 3 1 2% 7,919 17,789 25,708 25,708
Chief 1 0 0% 2,640 0 2,640
PMAC 3 3 6% 7,919 53,368 61,287 25% 660 61,947
Gen Recvng/Encoding 12 11 23% 31,676 195,683 227,359 25% 660 228,019
Verification 1 0 0% 2,640 0 2,640 25% 660 3,300
Medical Evaluation Unit 2 0 0% 5,279 0 5,279 25% 660 5,939
Chief 2 1 2% 5,279 17,789 23,069
Adjustment/CRU/Legal 5 2 4% 13,198 35,579 48,777 33% 7,690 56,467
Manual Processing 0 0 0% 0 0 0 33% 7,690 7,690
Processing Encoding 10 10 21% 26,397 177,894 204,291 33% 7,690 211,980
Chief 2 1 2% 5,279 17,789 23,069
Review I 0 0 0% 0 0 0 33% 7,690 7,690
Review II 0 0 0% 0 0 0 33% 7,690 7,690
Payment Approval 5 5 11% 13,198 88,947 102,145 33% 7,690 109,835
ACCOUNTING DIVISION
Chief 2 1 2% 5,279 17,789 23,069
Accounts Payable I 1 0 0% 2,640 0 2,640 25% 5,767 8,407
Accounts Payable II 2 0 0% 5,279 0 5,279 25% 5,767 11,047
Disbursement I 6 4 9% 15,838 71,157 86,996 25% 5,767 92,763
Disbursement II 3 0 0% 7,919 0 7,919 25% 5,767 13,686
58
Total # of Networked % of Total Networked Hardware Systems Analysis % of Sections Allocated New Sect
DIVISION/SECTION Computers Computers Computers Support & Oper.
Total
w/in each Div Costs Cost
Chief 1 0 0% 2,640 0 2,640
Admin Section 7 6 13% 18,478 106,736 125,214 50% 1,320 126,534
Information Section 6 2 4% 15,838 35,579 51,417 50% 1,320 52,737
TOTAL 74 47 100% 195,338 836,100 1,031,438 74,486 1,031,438
59
11. Other Costs
Local Trav Officers Mtg Extraordinary

DIVISION/SECTION Subsc. Total
Expenses Expense & Misc Exp
OFC OF THE DEPT MGR 132,000 15,000 166,000 313,000
PMAC 3,125 3,125
Gen Recvng/Encoding 3,125 3,125
Verification 3,125 3,125
Medical Evaluation Unit 3,125 3,125
Adjustment/CRU/Legal 3,125 3,125
Manual Processing 3,125 3,125
Processing Encoding 3,125 3,125
Review I 3,125 3,125
Review II 3,125 3,125
Payment Approval 3,125 3,125
ACCOUNTING DIVISION
Accounts Payable I 33,000 3,125 36,125
Accounts Payable II 33,000 1 3,125 36,126
Disbursement I 33,000 3,125 36,125
Disbursement II 33,000 3,125 36,125
Admin Section 3,125 3,125
Information Section 3,125 3,125
TOTAL 264,000 15,001 50,000 166,000 495,001
60
V. Costing of Regional Offices
1. Estimated Costs of Claims Processing in Regions Outside NCR
Head Occupancy
Personnel Supplies Rent & Utilities Equipment Dep'n IT Support Others Total
count Services
NCR 161 31,681,907 2,000,000 4,492,819 945,311 1,059,050 1,031,438 495,000 41,705,524
% 76% 5% 11% 2% 3% 2% 1% 100%
CAR 14 6,769,385 427,334 479,984 100,991 226,284 220,384 105,765 8,330,128

I 18 7,423,127 468,604 526,338 110,744 248,137 241,668 115,979 9,134,597
II 19 7,831,653 494,393 555,304 116,839 261,793 254,968 122,362 9,637,312
III 32 9,399,852 593,389 666,498 140,234 314,214 306,022 146,864 11,567,074
IV A 29 8,820,227 556,799 625,399 131,587 294,839 287,152 137,808 10,853,810
IV B 18 6,732,172 424,985 477,345 100,436 225,040 219,173 105,184 8,284,336
V 12 5,060,504 319,457 358,816 75,497 169,160 164,750 79,066 6,227,250
VI 24 7,401,561 467,242 524,809 110,422 247,416 240,966 115,642 9,108,058
VII 26 6,720,055 424,220 476,486 100,255 224,635 218,778 104,995 8,269,425
VIII 17 5,978,725 377,422 423,922 89,195 199,854 194,644 93,412 7,357,174
IX 18 5,878,880 371,119 416,843 87,706 196,517 191,393 91,852 7,234,309
X 40 10,975,084 692,830 778,190 163,735 366,871 357,305 171,475 13,505,490
XI 37 9,995,956 631,020 708,764 149,127 334,141 325,429 156,177 12,300,614
XII 22 6,790,033 428,638 481,448 101,299 226,974 221,057 106,088 8,355,537
CARAGA 14 5,711,837 360,574 404,998 85,214 190,933 185,955 89,242 7,028,753
Grand Total 502 143,170,957 9,038,026 12,397,964 2,608,592 4,785,861 4,661,080 2,236,912 178,899,391
61
Head Occupancy
Personnel Supplies Rent & Utilities Equipment Dep'n IT Support Others Total
count Services
% of Total Costs 80% 5% 7% 1% 3% 3% 1% 100%
Regions Total 111,489,050 7,038,026 7,905,145 1,663,281 3,726,811 3,629,642 1,741,912 137,193,867
% of Reg'l Costs 81% 5% 6% 1% 3% 3% 1% 100%
Regions Total as % of Grand Total: 77%
Breakdown: 62% 4% 4% 1% 2% 2% 1% 77%
Assumptions:
1. Regional costs for Supplies, Equipment Depreciation, IT Support and Others - NCR proportion holds
2. Regional costs for Rent & Utilities and Occupancy services - 50% of NCR proportion
3. Regional salary rates are the same as in NCR.
Source: Headcount: Estimated based on data provided by PHIC Health Finances Policy and Services Sector. Personnel Cost: Estimated based on number of claims processors and medical evaluators per region, with allowance for other types of
personnel based on NCR ratios.
62
2. Regional Claims Processing Personnel by Position
Region Position R/C SG Qty Annual S & B Total S & B

NCR Medical Officer IV R 20 3 455,634 1,366,901
Medical Officer IV C 20 6 248,300 1,489,800
Claims Processor I C 11 27 157,275 4,246,425
Claims Processor II C 13 34 173,775 5,908,350
Asst Claims Processor I C 8 40 134,450 5,378,000
Asst Claims Processor I R 8 1 294,005 294,005
Asst Claims Processor II C 10 5 149,850 749,250
Total 116 19,432,731
Total NCR-Claims 161 31,681,907
% 72.0% 61.3%
CAR Medical Officer VI R 24 1 564,792 564,792
Medical Officer IV R 20 2 484,967 969,934
Claims Processor I R 11 4 334,118 1,336,473
Claims Processor I C 11 4 157,275 629,100
Claims Processor II R 13 1 357,834 357,834
10 4,152,137
Others 4 2,617,247
Total 14 6,769,385
63
I Medical Officer VI R 24 1 564,792 564,792
Medical Officer VI C 22 1 266,450 266,450
13 4,553,123
Others 5 2,870,004
Total 18 7,423,127
II Medical Officer VI R 24 1 564,792 564,792
Medical Specialist III R 23 1 542,388 542,388
Medical Officer VI C 22 1 266,450 266,450
14 4,803,701
Others 5 3,027,952
Total 19 7,831,653
III Medical Officer VI R 24 1 564,792 564,792
Medical Officer V C 22 1 266,450 266,450
Asst Claims Processor I C 8 3 134,450 403,350
23 5,765,587
Others 9 3,634,265
Total 32 9,399,852
64
IV A Medical Officer VI R 24 1 564,792 564,792
Medical Officer IV C 20 1 248,300 248,300
21 5,410,062
Others 8 3,410,164
Total 29 8,820,227
IV B Medical Officer VI R 24 1 564,792 564,792
13 4,129,312
Others 5 2,602,860
Total 18 6,732,172
V Medical Officer VI R 24 1 564,792 564,792
9 3,103,961
Others 3 1,956,543
Total 12 5,060,504
65
VI Medical Officer VI R 24 1 564,792 564,792
17 4,539,895
Others 7 2,861,666
Total 24 7,401,561
VII Medical Officer VI R 24 1 564,792 564,792
19 4,121,880
Others 7 2,598,175
Total 26 6,720,055
VIII Medical Officer VI R 24 1 564,792 564,792
12 3,667,170
Others 5 2,311,554
Total 17 5,978,725
66
IX Medical Officer VI R 24 1 564,792 564,792
13 3,605,928
Others 5 2,272,951
Total 18 5,878,880
X Medical Officer VI R 24 1 564,792 564,792
29 6,731,787
Others 11 4,243,297
Total 40 10,975,084
67
XI Medical Officer VI R 24 1 564,792 564,792
27 6,131,219
Others 10 3,864,736
Total 37 9,995,956
XII Medical Officer VI R 24 1 564,792 564,792
16 4,164,802
Others 6 2,625,230
Total 22 6,790,033
CARAGA Medical Officer VI R 24 1 564,792 564,792
10 3,503,469
Others 4 2,208,367
Total 14 5,711,837
68
3. Claims Processing Cost per Region (2002, Outside NCR)
Head count Personnel Cost Non-Personnel Costs Total Cost No. of Claims Processed* Estimated Annual Volume Cost per Claim
CAR 14 6,769,385 1,560,743 8,330,128 13,503 40,509 206
I 18 7,423,127 1,711,470 9,134,597 20,471 61,413 149
II 19 7,831,653 1,805,659 9,637,312 12,066 36,198 266
III 32 9,399,852 2,167,222 11,567,074 56,258 168,774 69
IV A 29 8,820,227 2,033,584 10,853,810 41,227 123,681 88
IV B 18 6,732,172 1,552,164 8,284,336 25,815 77,445 107
V 12 5,060,504 1,166,745 6,227,250 25,605 76,815 81
VI 24 7,401,561 1,706,497 9,108,058 41,203 123,609 74
VII 26 6,720,055 1,549,370 8,269,425 49,236 147,708 56
VIII 17 5,978,725 1,378,450 7,357,174 14,448 43,344 170
IX 18 5,878,880 1,355,429 7,234,309 18,804 56,412 128
X 40 10,975,084 2,530,406 13,505,490 33,908 101,724 133
XI 37 9,995,956 2,304,659 12,300,614 40,863 122,589 100
XII 22 6,790,033 1,565,504 8,355,537 36,658 109,974 76
CARAGA 14 5,711,837 1,316,916 7,028,753 13,819 41,457 170
Grand Total 341 111,489,050 25,704,817 137,193,867 443,884 1,331,652 103
* From January to April 2002, Claims paid, RTS, Denied

Source: No. of Claims Processed - Dr. Sugay
69
VI. Proposed NCR Work Flows
Note: Available in hardcopy only.
1. Proposed NCR Work Flows – Level 0
70
VII. Proposed Functional Chart Claims Processing Department NCR
LEVELS 0, 1, AND 2
Levels 0, 1, 2
Dept Manager
CLAIMS EVALUATION CLAIMS PAYMENT RCVG, INFO & ADMIN

Div Chief Div Chief Div Chief
Med Eval'n QA Disbursement PMAC Info Admin

Chief
Team Team Team Team

1 3 5 9 Payment Claims
Approval Adjustment
Team Team Team Team
2 4 6 10
Claims Evaluation Teams
71
LEVEL 3
Level 3
(E-filing)
Dept Manager
CLAIMS EVALUATION CLAIMS PAYMENT RCVG, INFO & ADMIN

Div Chief Div Chief Div Chief
Medical Document Disbursement Claims

Evaluation Verification & Voucher Adjustment PMAC Info Admin
Printing
72
VIII. Costing of Proposed NCR Workflows – Manpower Complement
1. Level 0
Current Level 0
Direct Support Direct Support
workforce workforce workforce workforce
One-time Total Cost Actual Average Average cost ex. Actual Qty Sec Chief &/or Total work- Proposed Proposed Qty Total work- Comments
Qty* Qty** Section chief Clerks force Average Qty force
Office of the Dept Mgr (ODM) 3 1276623.44 3 3 3 3
Division Chief 1 564791.76 1 1 1 1
PMAC 10 1600580.04 9 145,175 1 294,005 10 9 1 10 3 to dist. claims to teams
Gen Rcvg & Encdg 13 1892518.16 9 129,867 2 575,518 11 10 0 10 1 per team
Verification 10 1504055.04 10 121,004 1 294,005 11 10 0 10 1 per team
Medical Evaluation 11 3476117.84 10 303,787 1 134,450 11 10 1 11 1 per team + Chief Med Evaluator
Adjudication 1
Division Chief 1 445425.12 1 1 0
Adjustment/Cru/Legal 4 927823.2 3 148,425 1 334,118 4 3 1 4 Retain function
Manual Processing 13 2093543.16 11 135,339 2 483,968 13 10 0 10 1 per team
Processing/Encoding 9 1377543.16 7 115,935 2 468,568 9 10 0 10 1 per team
Adjudication 2
Review 1 12 2189818.16 9 154,641 2 468,568 11 10 0 10 2 per team
Review 2 12 2123818.16 9 149,141 2 468,568 11 10 0 10 2 per team
Payment Approval 6 861425 4 143,571 1 157,275 5 2 0 2 1-voucher prtg; 1-pymt notice
Accounting
Division Chief 1 524508.8 1 1 1 1
Accounts Payable I 9 1731374.88 6 148,966 1 390,675 7 4 1 5 Convert to QA for teams
Accounts Payable II 9 1819125.12 6 152,632 1 445,425 7 0 0 0 Can be used as substitutes by teams
Disbursement I 15 2669275.12 14 148,256 1 445,425 15 14 1 15 Retain function
Disbursement II 7 1361430 10 136,071 1 408,925 11 10 1 11 Retain function
Info/Admin
Division Chief 1 524508.8 1 1 1 1
Admin 7 1232943.16 6 128,403 1 334,118 7 6 1 7 Retain function
Information 6 960150 5 133,812 1 157,275 6 5 1 6 Retain function
Grand Total: 161 31681906.92 128 2395023.461 29 5,860,887 157 123 14 137
* Quantity based on actual count conducted from April 26, 2002. ** Quantity based on sampling of 20 days from Jan 2, 2002 to May 10, 2002.
Source: Interviews with division/section chiefs, April-May 2002
73
2. Level 0 Costs
Current Current Level 0

Direct workforce Support workforce Direct workforce Support workforce
Total Cost One- Actual Average cost ex. Actual Qty Sec Chief &/or Total Total Cost Proposed Average cost ex. Proposed Sec Chief &/or Total Total Cost
time Qty* Average Qty** Section chief Clerks work- Average Qty Section chief Average Qty Clerks work-
force* force
Office of the Dept Mgr (ODM) 1,276,623 3 1,276,623 3 1,276,623 3 1,276,623 3 1,276,623
Division Chief 564,792 1 564,792 1 564,792 1 564,792 1 564,792
PMAC 1,600,580 9 145,175 1 294,005 10 1,600,580 9 145,175 1 294,005 10 1,600,580
Gen Rcvg & Encdg 1,892,518 9 129,867 2 575,518 11 1,744,318 10 129,867 0 10 1,298,667
Verification 1,504,055 10 121,004 1 294,005 11 1,504,045 10 121,004 0 10 1,210,040
Medical Evaluation 3,476,118 10 303,787 1 134,450 11 3,172,320 10 303,787 1 134,450 11 3,172,320
Adjudication 1
Division Chief 445,425 1 445,425 1 445,425 0 -
Adjustment/Cru/Legal 927,823 3 148,425 1 334,118 4 779,394 3 148,425 1 334,118 4 779,394
Manual Processing 2,093,543 11 135,339 2 483,968 13 1,972,701 10 135,339 0 10 1,353,394
Processing/Encoding 1,377,543 7 115,935 2 468,568 9 1,280,114 10 115,935 0 10 1,159,351
Adjudication 2
Division Chief 524,509 1 524,509 1 524,509 0 -
Review 1 2,189,818 9 154,641 2 468,568 11 1,860,334 10 154,641 0 10 1,546,407
Review 2 2,123,818 9 149,141 2 468,568 11 1,810,834 10 149,141 0 10 1,491,407
Payment Approval 861,425 4 143,571 1 157,275 5 731,558 2 143,571 0 2 287,142
Accounting
Division Chief 524,509 1 524,509 1 524,509 1 524,509 1 524,509
Accounts Payable I 1,731,375 6 148,966 1 390,675 7 1,284,469 4 148,966 1 390,675 5 986,538
Accounts Payable II 1,819,125 6 152,632 1 445,425 7 1,361,219 0 0 0 -
Disbursement I 2,669,275 14 148,256 1 445,425 15 2,521,004 14 148,256 1 445,425 15 2,521,004
Disbursement II 1,361,430 10 136,071 1 408,925 11 1,769,636 10 136,071 1 408,925 11 1,769,636
Info/Admin
Division Chief 524,509 1 524,509 1 524,509 1 524,509 1 524,509
Admin 1,232,943 6 128,403 1 334,118 7 1,104,534 6 128,403 1 334,118 7 1,104,534
Information 960,150 5 133,812 1 157,275 6 826,333 5 133,812 1 157,275 6 826,333
Grand Total: 31,681,907 128 29 9,721,254 157 29,183,761 123 14 5,389,424 137 23,997,178
New total as % of current cost: 82.2%

* Quantity based on sampling of 20 days from Jan 2, 2002 to May 10, 2002. ** Quantity based on sampling of 20 days from Jan 2, 2002 to May 10, 2002.
74
3. Level 1 and 2
Current Level 1 & 2

One-time Total Cost Actual Average Average cost ex. Actual Qty Sec Chief &/or Total work- Proposed Proposed Qty Total Comments
Qty* Qty** Section chief Clerks force Average Qty work-force
Division Chief 1 564791.76 1 1 1 1
PMAC 10 1600580.04 9 145,175 1 294,005 10 9 1 10 3 to dist. claims to teams
Gen Rcvg & Encdg 13 1892518.16 9 129,867 2 575,518 11 10 0 10 1 per team
Verification 10 1504055.04 10 121,004 1 294,005 11 10 0 10 1 per team
Medical Evaluation 11 3476117.84 10 303,787 1 134,450 11 10 1 11 1 per team + Chief Med Evaluator
Adjudication 1
Manual Processing 13 2093543.16 11 135,339 2 483,968 13 10 0 10 Assume Processor function; 1 per team
Processing/Encoding 9 1377543.16 7 115,935 2 468,568 9 10 0 10 Assume Processor function; 1 per team
Adjudication 2
Review 1 12 2189818.16 9 154,641 2 468,568 11 10 0 10 2 per team
Review 2 12 2123818.16 9 149,141 2 468,568 11 10 0 10 2 per team
Payment Approval 6 861425 4 143,571 1 157,275 5 2 0 2 1-voucher prtg; 1-pymt notice
Accounting
Division Chief 1 524508.8 1 1 1 1
Accounts Payable I 9 1731374.88 6 148,966 1 390,675 7 2 1 3 Less QA due to computerization
Accounts Payable II 9 1819125.12 6 152,632 1 445,425 7 0 0 0
Disbursement I 15 2669275.12 14 148,256 1 445,425 15 14 1 15 Retain function
Disbursement II 7 1361430 10 136,071 1 408,925 11 10 1 11 Retain function
Info/Admin
Division Chief 1 524508.8 1 1 1 1
Admin 7 1232943.16 6 128,403 1 334,118 7 6 1 7 Retain function
Information 6 960150 5 133,812 1 157,275 6 5 1 6 Retain function
Grand Total: 161 31681906.92 128 2395023.461 29 5,860,887 157 121 14 135
75
4. Level 1 and 2 Costs
Current Current Level 1 & 2

force* force
Division Chief 564,792 1 564,792 1 564,792 1 564,792 1 564,792
PMAC 1,600,580 9 145,175 1 294,005 10 1,600,580 9 145,175 1 294,005 10 1,600,580
Gen Rcvg & Encdg 1,892,518 9 129,867 2 575,518 11 1,744,318 10 129,867 0 10 1,298,667
Verification 1,504,055 10 121,004 1 294,005 11 1,504,045 10 121,004 0 10 1,210,040
Adjudication 1
Division Chief 445,425 1 445,425 1 445,425 0 -
Manual Processing 2,093,543 11 135,339 2 483,968 13 1,972,701 10 135,339 0 10 1,353,394
Processing/Encoding 1,377,543 7 115,935 2 468,568 9 1,280,114 10 115,935 0 10 1,159,351
Adjudication 2
Division Chief 524,509 1 524,509 1 524,509 0 -
Review 1 2,189,818 9 154,641 2 468,568 11 1,860,334 10 154,641 0 10 1,546,407
Review 2 2,123,818 9 149,141 2 468,568 11 1,810,834 10 149,141 0 10 1,491,407
Payment Approval 861,425 4 143,571 1 157,275 5 731,558 2 143,571 0 2 287,142
Accounting
Division Chief 524,509 1 524,509 1 524,509 1 524,509 1 524,509
Accounts Payable I 1,731,375 6 148,966 1 390,675 7 1,284,469 2 148,966 1 390,675 3 688,606
Disbursement I 2,669,275 14 148,256 1 445,425 15 2,521,004 14 148,256 1 445,425 15 2,521,004
Disbursement II 1,361,430 10 136,071 1 408,925 11 1,769,636 10 136,071 1 408,925 11 1,769,636
Info/Admin
Division Chief 524,509 1 524,509 1 524,509 1 524,509 1 524,509
Admin 1,232,943 6 128,403 1 334,118 7 1,104,534 6 128,403 1 334,118 7 1,104,534
Information 960,150 5 133,812 1 157,275 6 826,333 5 133,812 1 157,275 6 826,333
Grand Total: 31,681,907 128 29 9,721,254 157 29,183,761 121 14 5,389,424 135 23,699,246
76
5. Level 3
Current Level 3
One-time Total Cost Actual Average Average cost ex. Actual Qty Sec Chief &/or Total work- Proposed Proposed Qty Total Comments
Qty* Qty** Section chief Clerks force Average Qty work-force
Division Chief 1 564791.76 1 1 1 1
PMAC 10 1600580.04 9 145,175 1 294,005 10 9 1 10 3 to forward claims to Doc verifier
Gen Rcvg & Encdg 13 1892518.16 9 129,867 2 575,518 11 1 0 1 Retain 1 team for direct filers
Verification 10 1504055.04 10 121,004 1 294,005 11 1 0 1 Retain 1 team for direct filers
Medical Evaluation 11 3476117.84 10 303,787 1 134,450 11 6 1 7 Half of claims will be evaluated manually
Adjudication 1
Manual Processing 13 2093543.16 11 135,339 2 483,968 13 0 0 0
Processing/Encoding 9 1377543.16 7 115,935 2 468,568 9 2 0 2 Retain 1 team for direct filers
Adjudication 2
Review 1 12 2189818.16 9 154,641 2 468,568 11 10 0 10 Document verifiers
Review 2 12 2123818.16 9 149,141 2 468,568 11 2 0 2 Retain 1 team for direct filers
Payment Approval 6 861425 4 143,571 1 157,275 5 0 0 0
Accounting
Division Chief 1 524508.8 1 1 1 1
Accounts Payable I 9 1731374.88 6 148,966 1 390,675 7 0 0 0 Less QA due to computerization
Accounts Payable II 9 1819125.12 6 152,632 1 445,425 7 0 0 0
Disbursement I 15 2669275.12 14 148,256 1 445,425 15 3 0 3
Disbursement II 7 1361430 10 136,071 1 408,925 11 3 0 3 COA filing
Info/Admin
Division Chief 1 524508.8 1 1 1 1
Admin 7 1232943.16 6 128,403 1 334,118 7 4 1 5 Less due to system monitoring
Information 6 960150 5 133,812 1 157,275 6 3 1 4 Less due to claims status website
Grand Total: 161 31681906.92 128 2395023.461 29 5,860,887 157 47 11 58

77
6. Level 3 Costs

force* force
Division Chief 564,792 1 564,792 1 564,792 1 564,792 1 564,792
PMAC 1,600,580 9 145,175 1 294,005 10 1,600,580 9 145,175 1 294,005 10 1,600,580
Gen Rcvg & Encdg 1,892,518 9 129,867 2 575,518 11 1,744,318 1 129,867 0 1 129,867
Verification 1,504,055 10 121,004 1 294,005 11 1,504,045 1 121,004 0 1 121,004
Adjudication 1
Division Chief 445,425 1 445,425 1 445,425 0 -
Manual Processing 2,093,543 11 135,339 2 483,968 13 1,972,701 0 135,339 0 0 -
Processing/Encoding 1,377,543 7 115,935 2 468,568 9 1,280,114 2 115,935 0 2 231,870
Adjudication 2
Division Chief 524,509 1 524,509 1 524,509 0 -
Review 1 2,189,818 9 154,641 2 468,568 11 1,860,334 10 154,641 0 10 1,546,407
Review 2 2,123,818 9 149,141 2 468,568 11 1,810,834 2 149,141 0 2 298,281
Payment Approval 861,425 4 143,571 1 157,275 5 731,558 0 143,571 0 0 -
Accounting
Division Chief 524,509 1 524,509 1 524,509 1 524,509 1 524,509
Accounts Payable I 1,731,375 6 148,966 1 390,675 7 1,284,469 0 148,966 0 0 -
Disbursement I 2,669,275 14 148,256 1 445,425 15 2,521,004 3 148,256 0 3 444,767
Disbursement II 1,361,430 10 136,071 1 408,925 11 1,769,636 3 136,071 0 3 408,213
Info/Admin
Division Chief 524,509 1 524,509 1 524,509 1 524,509 1 524,509
Admin 1,232,943 6 128,403 1 334,118 7 1,104,534 4 128,403 1 334,118 5 847,728
Information 960,150 5 133,812 1 157,275 6 826,333 3 133,812 1 157,275 4 558,710
Grand Total: 31,681,907 128 29 9,721,254 157 29,183,761 47 11 4,144,399 58 11,814,426

* Quantity based on sampling of 20 days from Jan 2, 2002 to May 10, 2002.
78
7. Level 4 Costs

force* force
Division Chief 564,792 1 564,792 1 564,792 1 564,792 1 564,792
PMAC 1,600,580 9 145,175 1 294,005 10 1,600,580 9 145,175 1 294,005 10 1,600,580
Gen Rcvg & Encdg 1,892,518 9 129,867 2 575,518 11 1,744,318 1 129,867 0 1 129,867
Verification 1,504,055 10 121,004 1 294,005 11 1,504,045 1 121,004 0 1 121,004
Adjudication 1
Division Chief 445,425 1 445,425 1 445,425 0 -
Manual Processing 2,093,543 11 135,339 2 483,968 13 1,972,701 0 135,339 0 0 -
Processing/Encoding 1,377,543 7 115,935 2 468,568 9 1,280,114 2 115,935 0 2 231,870
Adjudication 2
Division Chief 524,509 1 524,509 1 524,509 0 -
Review 1 2,189,818 9 154,641 2 468,568 11 1,860,334 10 154,641 0 10 1,546,407
Review 2 2,123,818 9 149,141 2 468,568 11 1,810,834 2 149,141 0 2 298,281
Payment Approval 861,425 4 143,571 1 157,275 5 731,558 0 143,571 0 0 -
Accounting
Division Chief 524,509 1 524,509 1 524,509 1 524,509 1 524,509
Accounts Payable I 1,731,375 6 148,966 1 390,675 7 1,284,469 0 148,966 0 0 -
Disbursement I 2,669,275 14 148,256 1 445,425 15 2,521,004 0 148,256 0 0 -
Disbursement II 1,361,430 10 136,071 1 408,925 11 1,769,636 3 136,071 0 3 408,213
Info/Admin
Division Chief 524,509 1 524,509 1 524,509 1 524,509 1 524,509
Admin 1,232,943 6 128,403 1 334,118 7 1,104,534 4 128,403 1 334,118 5 847,728
Information 960,150 5 133,812 1 157,275 6 826,333 3 133,812 1 157,275 4 558,710
Grand Total: 31,681,907 128 29 9,721,254 157 29,183,761 44 11 4,144,399 55 11,369,659

* Quantity based on sampling of 20 days from Jan 2, 2002 to May 10, 2002.
79
8. Summary
Claims Processing Proposed Workflows

Personnel Costs Only
NCR Non-NCR Total Cost Savings % of Current Costs NCR Non-NCR Total Cost Savings % of Current Costs
Current 29,183,761 111,449,050 140,632,811 Current 29.2 111.4 140.6 -
Level 0 23,997,178 91,642,153 115,639,331 24,993,480 18% Level 0 24.0 91.6 115.6 25.0 18%
Level 1 23,699,246 90,504,391 114,203,638 26,429,173 19% Level 1 23.7 90.5 114.2 26.4 19%
Level 2 23,699,246 90,504,391 114,203,638 26,429,173 19% Level 2 23.7 90.5 114.2 26.4 19%
Level 3 11,814,426 45,117,782 56,932,208 83,700,603 60% Level 3 11.8 45.1 56.9 83.7 60%
Level 4 11,369,659 43,419,274 54,788,933 85,843,878 61% Level 4 11.4 43.4 54.8 85.8 61%
80
IX. Costing of Proposed Regional Work Flows
1. Level 0
Current Level 0
Head Personnel Head Personnel Supplies Rent & Utilities Occupancy Equipment IT Support Others Hardware Total
Count Count Services Dep'n Changes
NCR 161 29,183,761 137 23,997,178 1,514,882 3,403,046 716,017 802,168 781,253 374,933 0 31,589,477
% 76% 5% 11% 2% 3% 2% 1% 100%
CAR 14 6,769,385 12 5,566,319 351,388 394,681 83,043 186,069 181,217 86,969 6,849,685
I 18 7,423,127 15 6,103,877 385,323 432,796 91,062 204,038 198,718 95,367 7,511,182
II 19 7,831,653 16 6,439,799 406,529 456,615 96,074 215,267 209,654 100,616 7,924,554
III 32 9,399,852 27 7,729,296 487,931 548,047 115,312 258,372 251,635 120,763 9,511,356
IV A 29 8,820,227 25 7,252,682 457,844 514,252 108,201 242,440 236,119 113,316 8,924,854
IV B 18 6,732,172 15 5,535,720 349,456 392,511 82,586 185,046 180,221 86,490 6,812,031
V 12 5,060,504 10 4,161,144 262,683 295,046 62,079 139,097 135,470 65,014 5,120,533
VI 24 7,401,561 20 6,086,144 384,203 431,539 90,798 203,445 198,141 95,090 7,489,360
VII 26 6,720,055 22 5,525,757 348,827 391,804 82,438 184,713 179,897 86,335 6,799,770
VIII 17 5,978,725 14 4,916,177 310,346 348,582 73,343 164,336 160,051 76,811 6,049,646
IX 18 5,878,880 15 4,834,076 305,163 342,761 72,119 161,592 157,378 75,528 5,948,617
X 40 10,975,084 34 9,024,575 569,699 639,889 134,636 301,670 293,804 141,001 11,105,274
XI 37 9,995,956 31 8,219,459 518,874 582,802 122,624 274,757 267,593 128,421 10,114,530
XII 22 6,790,033 19 5,583,298 352,460 395,884 83,296 186,636 181,770 87,234 6,870,578
CARAGA 14 5,711,837 12 4,696,720 296,492 333,022 70,069 157,000 152,907 73,382 5,779,592
Grand Total 501 140,672,811 426 115,672,222 7,302,100 9,903,276 2,083,697 3,866,644 3,765,830 1,807,270 0 144,401,039
% of Total Costs for Level 0 80% 5% 7% 1% 3% 3% 1% 0% 100%
Regions Total for Level 0 91,675,044 5,787,218 6,500,230 1,367,680 3,064,476 2,984,577 1,432,336 0 112,811,561
% of Regnl Costs for Level 0 81% 5% 6% 1% 3% 3% 1% 0% 100%
Breakdown: 63% 4% 5% 1% 2% 2% 1% 0% 78%
Assumptions:
1. Regional Head Count and Personal Costs for Level 0 - NCR proportion holds
2. Regional costs for Supplies, Eqpt Depn, IT Support and Others for Level 0 - NCR proportion holds
3. Regional costs for Rent & Utilities and Occupancy services for Level 0- 50% of NCR proportion
4. Regional salary rates are the same as in NCR
81
2. NCR Percent Reduction in Headcount and Personnel Costs for Each Level
Assumption: Percentage reduction in headcount for NCR in each proposed level is also applicable to the regional offices.
LEVEL HEAD COUNT PERSONNEL COSTS

Current 161 29,183,761
Level 0 137 23,997,178

% of Current 85% 82%
Level 1 135 23,699,246

Level 2 135 23,699,246

Level 3 58 11,814,426
Level 4 55 11,369,659
NOTE: NCR Headcount and personnel costs from Part S (Level 0-2) & Part T (Level 3&4)
82
3. Level 1
Current Level 1
NCR 161 29,183,761 135 23,699,246 1,496,074 3,360,796 707,128 792,209 771,554 370,278 0 31,197,286
% 76% 5% 11% 2% 3% 2% 1% 100%
CAR 14 6,769,385 12 5,497,212 347,025 389,780 82,012 183,759 178,967 85,889 6,764,644
I 18 7,423,127 15 6,028,096 380,539 427,423 89,932 201,505 196,251 94,183 7,417,929
II 19 7,831,653 16 6,359,847 401,481 450,946 94,881 212,594 207,051 99,367 7,826,168
III 32 9,399,852 27 7,633,335 481,873 541,243 113,880 255,164 248,511 119,264 9,393,270
IV A 29 8,820,227 24 7,162,638 452,160 507,868 106,858 239,430 233,187 111,909 8,814,050
IV B 18 6,732,172 15 5,466,993 345,118 387,638 81,561 182,748 177,984 85,417 6,727,458
V 12 5,060,504 10 4,109,482 259,421 291,383 61,308 137,370 133,788 64,207 5,056,960
VI 24 7,401,561 20 6,010,583 379,433 426,181 89,671 200,919 195,681 93,910 7,396,378
VII 26 6,720,055 22 5,457,153 344,496 386,940 81,414 182,420 177,663 85,263 6,715,349
VIII 17 5,978,725 14 4,855,141 306,493 344,254 72,433 162,296 158,064 75,857 5,974,538
IX 18 5,878,880 15 4,774,060 301,375 338,505 71,223 159,585 155,424 74,590 5,874,763
X 40 10,975,084 34 8,912,533 562,626 631,944 132,964 297,925 290,157 139,250 10,967,399
XI 37 9,995,956 31 8,117,412 512,432 575,566 121,102 271,346 264,271 126,827 9,988,956
XII 22 6,790,033 18 5,513,979 348,084 390,969 82,262 184,319 179,513 86,151 6,785,278
CARAGA 14 5,711,837 12 4,638,409 292,811 328,887 69,199 155,051 151,008 72,471 5,707,837
Grand Total 501 140,672,811 420 114,236,120 7,211,442 9,780,324 2,057,828 3,818,639 3,719,076 1,784,832 0 142,608,262

Breakdown: 63% 4% 5% 1% 2% 2% 1% 0% 78%
Assumptions:
83
4. Level 2
Current Level 2
NCR 161 29,183,761 135 23,699,246 1,496,074 3,360,796 707,128 792,209 771,554 370,278 0 31,197,286
% 76% 5% 11% 2% 3% 2% 1% 100%
CAR 14 6,769,385 12 5,497,212 347,025 389,780 82,012 183,759 178,967 85,889 6,764,644
I 18 7,423,127 15 6,028,096 380,539 427,423 89,932 201,505 196,251 94,183 7,417,929
II 19 7,831,653 16 6,359,847 401,481 450,946 94,881 212,594 207,051 99,367 7,826,168
III 32 9,399,852 27 7,633,335 481,873 541,243 113,880 255,164 248,511 119,264 9,393,270
IV A 29 8,820,227 24 7,162,638 452,160 507,868 106,858 239,430 233,187 111,909 8,814,050
IV B 18 6,732,172 15 5,466,993 345,118 387,638 81,561 182,748 177,984 85,417 6,727,458
V 12 5,060,504 10 4,109,482 259,421 291,383 61,308 137,370 133,788 64,207 5,056,960
VI 24 7,401,561 20 6,010,583 379,433 426,181 89,671 200,919 195,681 93,910 7,396,378
VII 26 6,720,055 22 5,457,153 344,496 386,940 81,414 182,420 177,663 85,263 6,715,349
VIII 17 5,978,725 14 4,855,141 306,493 344,254 72,433 162,296 158,064 75,857 5,974,538
IX 18 5,878,880 15 4,774,060 301,375 338,505 71,223 159,585 155,424 74,590 5,874,763
X 40 10,975,084 34 8,912,533 562,626 631,944 132,964 297,925 290,157 139,250 10,967,399
XI 37 9,995,956 31 8,117,412 512,432 575,566 121,102 271,346 264,271 126,827 9,988,956
XII 22 6,790,033 18 5,513,979 348,084 390,969 82,262 184,319 179,513 86,151 6,785,278
CARAGA 14 5,711,837 12 4,638,409 292,811 328,887 69,199 155,051 151,008 72,471 5,707,837
Grand Total 501 140,672,811 420 114,236,120 7,211,442 9,780,324 2,057,828 3,818,639 3,719,076 1,784,832 0 142,608,262

Breakdown: 63% 4% 5% 1% 2% 2% 1% 0% 78%
Assumptions:
84
5. Level 3
Current Level 3
NCR 161 29,183,761 58 11,814,426 745,815 1,675,407 352,514 394,928 384,631 184,589 0 15,552,310
% 76% 5% 11% 2% 3% 2% 1% 100%
CAR 14 6,769,385 5 2,740,442 172,997 194,311 40,884 91,606 89,218 42,817 3,372,275
I 18 7,423,127 6 3,005,095 189,704 213,077 44,832 100,453 97,834 46,952 3,697,948
II 19 7,831,653 7 3,170,478 200,144 224,803 47,300 105,981 103,218 49,536 3,901,461
III 32 9,399,852 12 3,805,331 240,221 269,817 56,771 127,203 123,887 59,455 4,682,684
IV A 29 8,820,227 10 3,570,682 225,408 253,180 53,270 119,359 116,247 55,789 4,393,935
IV B 18 6,732,172 6 2,725,377 172,046 193,243 40,659 91,103 88,727 42,581 3,353,737
V 12 5,060,504 4 2,048,638 129,325 145,259 30,563 68,481 66,696 32,008 2,520,970
VI 24 7,401,561 9 2,996,365 189,153 212,458 44,702 100,161 97,550 46,815 3,687,204
VII 26 6,720,055 9 2,720,472 171,737 192,895 40,586 90,939 88,568 42,505 3,347,701
VIII 17 5,978,725 6 2,420,360 152,791 171,616 36,109 80,907 78,797 37,816 2,978,396
IX 18 5,878,880 6 2,379,940 150,240 168,750 35,506 79,556 77,481 37,184 2,928,656
X 40 10,975,084 14 4,443,030 280,477 315,034 66,285 148,520 144,647 69,418 5,467,411
XI 37 9,995,956 13 4,046,650 255,455 286,928 60,371 135,270 131,743 63,225 4,979,643
XII 22 6,790,033 8 2,748,801 173,525 194,904 41,009 91,886 89,490 42,947 3,382,562
CARAGA 14 5,711,837 5 2,312,316 145,971 163,955 34,497 77,295 75,280 36,128 2,845,441
Grand Total 501 140,672,811 180 56,948,401 3,595,011 4,875,637 1,025,858 1,903,648 1,854,015 889,765 0 71,092,334
Regions Total for Level 3 45,133,975 2,849,196 3,200,230 673,344 1,508,720 1,469,384 705,176 0 55,540,024

Breakdown: 63% 4% 5% 1% 2% 2% 1% 0% 78%
Assumptions:
85
6. Level 4
Current Level 3
NCR 161 29,183,761 55 11,369,659 717,738 1,612,334 339,243 380,060 370,151 177,640 0 14,966,826
% 76% 5% 11% 2% 3% 2% 1% 100%
CAR 14 6,769,385 5 2,637,275 166,485 186,996 39,345 88,158 85,859 41,205 3,245,322
I 18 7,423,127 6 2,891,965 182,563 205,055 43,145 96,671 94,151 45,184 3,558,734
II 19 7,831,653 6 3,051,122 192,610 216,340 45,519 101,992 99,332 47,671 3,754,586
III 32 9,399,852 11 3,662,075 231,178 259,660 54,634 122,414 119,223 57,216 4,506,400
IV A 29 8,820,227 10 3,436,259 216,923 243,648 51,265 114,866 111,871 53,688 4,228,520
IV B 18 6,732,172 6 2,622,777 165,569 185,968 39,129 87,673 85,387 40,978 3,227,482
V 12 5,060,504 4 1,971,514 124,457 139,790 29,413 65,903 64,185 30,803 2,426,065
VI 24 7,401,561 8 2,883,563 182,032 204,459 43,019 96,391 93,877 45,053 3,548,395
VII 26 6,720,055 9 2,618,057 165,271 185,634 39,058 87,515 85,234 40,905 3,221,673
VIII 17 5,978,725 6 2,329,243 147,039 165,155 34,749 77,861 75,831 36,392 2,866,271
IX 18 5,878,880 6 2,290,344 144,584 162,397 34,169 76,561 74,565 35,784 2,818,404
X 40 10,975,084 14 4,275,767 269,919 303,174 63,789 142,929 139,202 66,805 5,261,584
XI 37 9,995,956 13 3,894,310 245,838 276,127 58,098 130,177 126,783 60,845 4,792,178
XII 22 6,790,033 8 2,645,319 166,992 187,567 39,465 88,427 86,121 41,331 3,255,221
CARAGA 14 5,711,837 5 2,225,266 140,476 157,783 33,198 74,385 72,446 34,768 2,738,322
Grand Total 501 140,672,811 171 54,804,516 3,459,673 4,692,088 987,238 1,831,983 1,784,218 856,269 0 68,415,985
Regions Total for Level 3 43,434,857 2,741,935 3,079,754 647,995 1,451,923 1,414,067 678,629 0 53,449,159
Breakdown: 63% 4% 5% 1% 2% 2% 1% 0% 78%
Assumptions:
86
7. Summary
Region Current Level 0 Level 1 Level 2 Level 3 Level 4
NCR 41,705,524 31,589,477 31,197,286 31,197,286 15,552,310 14,966,826

CAR 8,330,128 6,849,685 6,764,644 6,764,644 3,372,275 3,245,322
I 9,134,597 7,511,182 7,417,929 7,417,929 3,697,948 3,558,734
II 9,637,312 7,924,554 7,826,168 7,826,168 3,901,461 3,754,586
III 11,567,074 9,511,356 9,393,270 9,393,270 4,682,684 4,506,400
IV A 10,853,810 8,924,854 8,814,050 8,814,050 4,393,935 4,228,520
IV B 8,284,336 6,812,031 6,727,458 6,727,458 3,353,737 3,227,482
V 6,227,250 5,120,533 5,056,960 5,056,960 2,520,970 2,426,065
VI 9,108,058 7,489,360 7,396,378 7,396,378 3,687,204 3,548,395
VII 8,269,425 6,799,770 6,715,349 6,715,349 3,347,701 3,221,673
VIII 7,357,174 6,049,646 5,974,538 5,974,538 2,978,396 2,866,271
IX 7,234,309 5,948,617 5,874,763 5,874,763 2,928,656 2,818,404
X 13,505,490 11,105,274 10,967,399 10,967,399 5,467,411 5,261,584
XI 12,300,614 10,114,530 9,988,956 9,988,956 4,979,643 4,792,178
XII 8,355,537 6,870,578 6,785,278 6,785,278 3,382,562 3,255,221
CARAGA 7,028,753 5,779,592 5,707,837 5,707,837 2,845,441 2,738,322
Total 178,899,391 144,401,039 142,608,262 142,608,262 71,092,334 68,415,985
Decrease from Current 34,498,352 36,291,130 36,291,130 107,807,057 110,483,406

% Decrease fm Current 19% 20% 20% 60% 62%
87
X. Return on Investment for Proposed Workflows
1. Summary of NCR Workflows
LEVEL MAJOR CHANGE SOFTWARE CHANGES HARDWARE TEAM MEMBERS PROCESSING TIME PER CLAIMS TURN- HEAD TOTAL PERSONNEL
CHANGES TEAM AROUND TIME* COUNT COSTS (P Million)
Current 45 days 161 29.2

0 From function- Disable LCR printing No need for Encoder, Initial verifier, 2.5 minutes per claim; 168 6 days *From 137 24.0
oriented sections to LCR printer Medical evaluator, claims per team per day receipt of
claims-oriented Manual processor, supporting
teams; Cancel LCR Processor encoder, 2 documents
procedure & voucher Adjudication reviewers
review process
1 Compensable amount Level 0 + Adjudication system 1 more PC per Encoder, Initial verifier, 2.5 minutes per claim; 168 6 days 135 23.7
computed by system team for 2nd Medical evaluator, 2 claims per team per day
Processor Processors, 2
Adjudication reviewers
2 ICD-10 checking and Level 1 + ICD-10 checking 1 PC per Encoder, Initial verifier, 2.5 minutes per claim; 168 6 days 135 23.7
look-up system Medical Medical evaluator, 2 claims per team per day
Evaluator Processors, 2
Adjudication reviewers
3 E-filing by claimant; Level 2 + Electronic claims fill- Transfer PC of Team disbanded. Only 2.5 minutes per claim for 1 day 58 11.8
no more encoding & up form (or in XML format) + processor to Medical evaluators "manual" medical evaluation; 1.0
verification of PHIC claims receipt & document (centralized) & minutes otherwise; 420 claims
form data; Supporting acknowledgement system + verifier Document verifiers per day per verifier
documents to be sent claims evaluation system with (decentralized) needed
in and verified CPGs + document verification
separately; Claims system + claims status
status website website
4 Auto-credit for Level 3 Medical evaluators & Same as Level 3 1 day 56 11.6
hospitals document verifiers
88
2. One-Time, Up-Front Investment Costs
(Note: Costs are cumulative, e.g., Level 1 costs include Level 0 costs)
For NCR Software Dev't Hardware Training Change in Info Campaign Others Total For NCR Software Hard- Train- Change in Info Cam- Others Total
Office Layout Dev't ware ing Office paign
Layout
Level 0 10,750 - 5,000 5,000 - 20,750 Level 0 11 - 5 5 - - 21
Level 1 37,250 350,000 10,000 - - 397,250 Level 1 37 350 10 - - - 397
Level 2 155,250 700,000 20,000 - - 875,250 Level 2 155 700 20 - - - 875
Level 3 1,723,250 1,250,000 135,000 55,000 2,310,000 250,000 5,723,250 Level 3 1,723 1,250 135 55 2,310 250 5,723
Level 4 1,771,250 1,250,000 140,000 55,000 2,360,000 250,000 5,826,250 Level 4 1,771 1,250 140 55 2,360 250 5,826
NOTES:
Level 3 hardware: 1 powerful web server to receive and process e-filed claims, and Level 3 others: monitoring and evaluation of e-filing process, by external agency
*It is assumed here that any reduction in headcount will be sourced from contractual employees, thus, there will be no severance pay for years of service.
For Reg’l Software Hardware Training Change in Office Info Campaign Others Total
Offices Installation Layout
Level 0 141,136 - 5,000 150,000 - 296,136
Level 1 282,273 1,050,000 10,000 - - 1,342,273
Level 2 423,409 2,100,000 20,000 - - 2,543,409
Level 3 564,545 6,150,000 35,000 300,000 - - 7,049,545
Level 4 705,682 6,150,000 40,000 300,000 - - 7,195,682
NOTES:
Software developed for NCR will be applicable to the regions as well.
Software Installation: Each new version of the software will have to be installed in each of the 15 regional office. This involves travel by systems analyst to each office and stay for around 3 days to test the system and train the claims processing
personnel. A trip to each office will cost about P5,000 in travel cost, 3 days of systems analyst/programmer time, and P1000 per diem.
Hardware: Same rate of increase in PCs as NCR, based on total of 30 teams among the 15 regions.
Change in Office Layout: P10,000 per region for 15 regions
Total Investment Costs for NCR and 15 Regional Offices

NCR & Software Dev't Hardware Training Change in Info Campaign Others Total NCR & Software Hard- Train- Change in Info Cam- Others Total
Reg'l & Installation Office Layout Reg'l Dev't ware ing Office paign
Offices Offices Layout
Level 0 151,886 - 10,000 155,000 - - 316,886 Level 0 152 - 10 155 - - 317
Level 1 319,523 1,400,000 20,000 - - - 1,739,523 Level 1 320 1,400 20 - - - 1,740
Level 2 578,659 2,800,000 40,000 - - - 3,418,659 Level 2 579 2,800 40 - - - 3,419
Level 3 2,287,795 7,400,000 170,000 355,000 2,310,000 250,000 12,772,795 Level 3 2,288 7,400 170 355 2,310 250 12,773
Level 4 2,476,932 7,400,000 180,000 355,000 2,360,000 250,000 13,021,932 Level 4 2,477 7,400 180 355 2,360 250 13,022
89
3. Software Development Costs for Proposed Workflows
Assumptions:
• Systems Analyst (SA) 25,000 per man-month
• Programmer (Pr) 18,000 per man-month
• Data Entry Clerk (DEC) 10,000 per man-month
• Training includes reproduction of manuals, instructions, hands-on
• Change of office layout includes moving of furniture, equipment, files, phone and network connections.
A. For Level 0
Software change: Disable LCR printing
Systems Personnel Man-Month Cost
Systems Analyst 0.25 6,250
Programmer 0.25 4,500
10,750
B. For Level 1
Software change: Compensable amount computed by system
Data Entry Clerk 0.5 5,000
26,500
C. For Level 2
Software change: ICD-10 checking and look-up
Systems Analyst 2 50,000
Programmer 1 18,000
Data Entry Clerk 5 50,000
118,000
D. For Level 3
Software change: E-filing and attendant systems
Assumptions:
1. Adobe PDF environment will be used.
2. Adobe client costs will be shouldered by hospitals/providers
3. Database to be used is Oracle (already owned by PHIC)
90
Software development cost assumptions (rough conservative estimates):
Systems Development Cycle Processing Medical Logic Comments
modules* modules (per CPG)**
Systems analysis
problem identification Done
data gathering Done
Analysis Done
Software design 50,000 50,000 Med logic modules done with medical societies
Software development 25,000 25,000 Output is electronic form in PDF format
Testing and refinement 50,000 10,000 From e-filing to payment
Parallel run For one month (mornings only)
2 full-time systems analysts 50,000 Salaries & benefits
Supplies 10,000 Mock-up of claims forms with supporting docs
2 Medical evaluators 50,000 Salaries & benefits
1 Document verifier 10,000 Salaries & benefits
Training of Claims Proc Dept. 100,000 Manuals, hands-on, training aids, dry-run
Evaluation & monitoring 200,000 50,000 To be done by external agency after 3 months
Implementation
2 full-time systems analysts 50,000 Salaries & benefit per month
* Includes Electronic claims fill-up form, receipt and acknowledgement system, document verification system, and
claims status website
** For the medical evaluation system
91
Thus, for 15 CPGs and 12 months operations:
Systems Development Cycle Processing Medical Logic modules (per Comments
module CPG)
Systems analysis
problem identification Done
data gathering Done
Analysis Done
Software design 50,000 750,000
Output is electronic form in PDF
Software development 25,000 375,000 format
Testing and refinement 50,000 150,000 From e-filing to payment
Parallel run For one month (mornings only)
SA (2 man-months) 50,000 Salaries & benefits
Mock-up of claims forms with
Supplies 10,000 supporting docs
Med evaluators (2 man-months) 50,000 Salaries & benefits
Clerk (1 man-month) 10,000 Salaries & benefits
Total software investment: 245,000 1,275,000
Other one-time costs:

Training of Claims Proc Dept. 100,000 Manuals, hands-on, dry-run
To be done by external agency after
Evaluation & monitoring 200,000 50,000 3 months
300,000 50,000
Implementation (for 12 months)
2 full-time systems analysts 600,000 Total Salaries & benefit
E. For Level 4
Software change: Improve auto-credit system
Data Entry Clerk 0.5 5,000
48,000
92
4. Timetable
Plan A. Sequential Implementation
Number of Months
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16
Level 0
Level 1
Level 2
Level 3
Level 4
Plan B. Simultaneous Development of Software
Number of Months
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16
Level 0
Level 1
Level 2
Level 3
Level 4
93
5. Return on Investment (ROI)
For NCR & Regional Offices

Annual Savings
Total Personnel Non- Total Annual Incremental Net Annual ROI (Savings Total Person- Non- Total Incremental Net ROI
Investment Costs Personnel Savings Annual Savings over Invt nel Costs Personnel Annual Annual Annual
Costs (20% Operating investments) Costs* Savings Operating Savings
of Personnel Costs Costs
Costs)
[A] [B] [C] [D=B+C] [E] [G=D-E] [H=G/A] [A] [B] [C] [D=B+C] [E] [G=D-E] [H=G/A]
Level 0 316,886 24,993,480 4,998,696 29,992,176 - 29,992,176 9465% Level 0 0.3 25.0 5.0 30.0 - 30.0 9465%
Level 1 1,739,523 26,429,173 5,285,835 31,715,007 - 31,715,007 1823% Level 1 1.7 26.4 5.3 31.7 - 31.7 1823%
Level 2 3,418,659 26,429,173 5,285,835 31,715,007 600,000 31,115,007 910% Level 2 3.4 26.4 5.3 31.7 0.6 31.1 910%
Level 3 12,772,795 83,700,603 16,740,121 100,440,723 1,000,000 99,440,723 779% Level 3 12.8 83.7 16.7 100.4 1.0 99.4 779%
Level 4 13,021,932 85,843,878 17,168,776 103,012,654 1,000,000 102,012,654 783% Level 4 13.0 85.8 17.2 103.0 1.0 102.0 783%
* 20% of personnel costs
Notes on Annual Operating Costs

This does not include the cost of personnel performing the various claims processing functions.
Rather, this would cover the cost of additional systems personnel for IT support, as well as computer supplies.
Level 0: No additional systems personnel needed
Level 1: No additional systems personnel needed
Level 2: 1 additional IT support for ICD10 checking system. (P400,000 per year for salaries & benefits per IT staff). Additional computer supplies of about P200,000 per year.
Level 3: 2 additional IT support
Level 4: 2 additional IT support
94
Health Sector
XI. Electronic Filing of Claims

Reform Technical
Assistance Project
1. Introduction
Electronic filing is the process of claiming reimbursement from PhilHealth using

the digital media. Specifically, it entails the digital encoding of all the existing
business rules of PHIC and their application to claims that are submitted in
electronic form. By definition, an electronic claim is a digital file that contains all
the pertinent data required for reimbursement.
Electronic filing of claims is a complex system that has both external and internal
processing systems. It will involve entities other than PhilHealth, specifically, the
health providers (physicians, hospitals, out-patient facilities), the patients, and the
network providers. The data elements that flow from each entity, including the
computer logic (algorithm) that is implemented on them are all within the domain
of PhilHealth.
There are many advantages of electronic filing and the benefits extend to all
entities involved.
1.1 Machine-readable data ready for documentation and analysis of claims

for operational and clinical research
With the submission of electronic data, the process of encoding is passed on to

the claimant. Illegibility is eliminated, and improper encoding will be due to
claimant error not PHIC encoder.
1.2 Online error checking at several levels
The speed by which computer algorithms can detect errors in the filling out of
forms may be applied at several levels. Upon submission, fundamental
deficiencies (no name, no member ID, no ICD code, etc) may be detected
whereupon the electronic claim is refused outright and the proper error message
returned to the sender. If accepted, more complex algorithms from the whole
claims process may be applied within seconds and a proper error message again
sent to the sender. For the claimant, it provides quick turnaround time for them to
revise their claim. For PHIC, it eliminates the manpower for manual checking of
completeness of forms.
1.3 Standard application of business logic across claims and across

evaluators/encoders (CPGs)
In areas of the claims process where evaluation is subjective (e.g. medical

evaluation), computer algorithms may simplify and standardize the evaluation
95
process. This diminishes inter- and intra-rater variability. It also provides
electronic documentation of the evaluation process, which may be useful for Health Sector
Reform Technical
process analysis later on. Assistance Project
1.4 Lower operational costs
The elimination of manpower for tedious tasks like checking for form
completeness will redound to lower expenses for human resources. The ability of
electronic transactions to keep automatic logs and audit trails minimizes steps
that require the printing of transmittal slips, vouchers, and reports.
1.5 Improved security:
New technologies have been developed that will enhance the authenticity,
integrity, confidentially of electronic files making transactions with PHIC more
secure and private.
1.6 Masking of data which may potentially bias evaluator
Some evaluators may be biased when they see particular data (doctor’s name,
hospital name, patient name, etc). Masking this data electronically (differentiate
from integrity, confidentiality)
1.7 View status of claims online
This provides almost immediate feedback to the claimant regarding the status of
their claim and allows them to take remedial action if their claim is evaluated as
“RTH” or “Denied”. This also reduces the amount of time spent by Claims
Processing Department in fielding questions from health providers regarding
claims status.
2. Electronic Filing and Clinical Practice Guidelines
Clinical practice guidelines are algorithms on how to most efficiently manage a

given disease based on best evidence or accumulated experience. This is the
reason health outcomes research is a critical component of CPGs. Created by
experts and authorities in the specialty field, CPGs inform the practitioner and
consumer of what is state-of-the-art in the management of diseases.
For health insurance claims, CPGs have an important role in determining what
elements may be reimbursed or not based on existing clinical evidence. As an
example of a simple implementation, CPGs can be used to flag drugs and
procedures that are relevant to a particular disease and therefore compensable.
In the present manual system, medical evaluators to some extent are able to
apply CPGs into the claims evaluation. To be effective however, there are some
issues and requirements:
a. The evaluator has to be well versed with the CPG.
96
b. The evaluator still has the prerogative to reimburse claims even if they do not
meet current standards of care as prescribed by CPGs. Health Sector
Reform Technical
Assistance Project
c. If CPGs are applied there is no recording system that informs PHIC of how
many times CPGs were applied in claims and how many times CPGs were
disregarded (that is, the claim was still compensated even if the clinical
management was not according to guidelines).
Electronic filing of claims aims to diminish if not eliminate most of these issues.
With all the data in electronic format, CPGs in the form of algorithms may be
easily applied automatically to claims as they are received base on the ICD10
code. If a CPG is applicable, the rules for compensation are calculated for each
of the following areas: drugs, laboratory procedures, operations, and room and
board. As an additional benefit, there now exists an information system that can
update PHIC managers on the number of claims that followed prescribed
standard care and which ones that do not.
3. Technology, Processes and Principles
The following section is a high-level discussion on the strategic option of filing

claims electronically as it pertains to PhilHealth and its partners.
To understand better, let us divide the electronic filing into sub-processes:
Step 1. Creation of an electronic form
Step 2. Filling out of the electronic form
Step 3. Submission of electronic form to PHIC (includes toll to be paid to

Internet Service Provider)
Step 4. Receipt and acknowledgement of electronic form (by PHIC)
Step 5. Processing of electronic form using existing business logic
Step 6. Presentation of status of electronic claim (Approved, Return to

Hospital, Denied)
Steps 1-3 are considered external systems while 4-6 are internal.
3.1 External processing system
The current manual system of filing claims mainly involves hospitals submitting
duly accomplished paper forms to the PhilHealth main office. These paper forms
are produced and freely distributed by PHIC, and reproduction by photocopying
is allowed.
Since the contents of an accomplished form are not machine readable, claims
process heavily involves humans to interpret and process the data elements
using existing business logic of PhilHealth. The previous section on cost analysis
(Darwin) clearly shows the average amount of effort and cost of filing one claim.
97
3.2 Creation of electronic forms Health Sector
Reform Technical
Assistance Project
In creating electronic forms, PhilHealth has two non-mutually exclusive options:

(a) create the electronic form in-house; or (b) provide a reference file format for
claims in eXtensible Markup Language (XML).
For option one, as with the paper form, PhilHealth has the option to produce and
to freely distribute the electronic forms. PhilHealth may also allow reproduction of
the electronic forms. The advantage of doing this is the control PhilHealth will
have on the file format of the output since the form design arose from PhilHealth
at the outset.
Option two requires PhilHealth to publish a standard file format that can be used
by providers and claimants in creating electronic claims in a format acceptable to
PhilHealth. An example of this is an XML Schema for PHIC (work in progress
NIH Study Group on Standards for Health Information in the Philippines). An
XML schema is a reference for the creation of XML files. An electronic claim will
be a file in XML format and its validity and well formed-ness is matched against
the XML schema. By providing an XML Schema as a reference, hospitals that
have existing computerized information systems can create simple programs that
can adapt local systems to produce electronic claims in XML compatible with that
of the XML Schema for PHIC. (see example of XML Schema and XML file).
Sample XML Schema for Communicable Disease Reporting

<?xml version="1.0"?>
<xsd:schema xmlns:xsd="http://www.w3.org/2001/XMLSchema"
targetNamespace="http://www.wpro.who.int"
xmlns="http://www.wpro.who.int"
elementFormDefault="qualified">
<xsd:element name="WHO Communicable Disease Response">
<xsd:complexType>
<xsd:sequence>
<xsd:element ref="Country" minOccurs="1" maxOccurs="1"/>
<xsd:element ref="Data" minOccurs="1"
maxOccurs="unbounded"/>
</xsd:sequence>
</xsd:complexType>
</xsd:element>
<xsd:element name="Data">
<xsd:complexType>
<xsd:sequence>
<xsd:element ref="ICD10" minOccurs="1" maxOccurs="1"/>
<xsd:element ref="Period" minOccurs="1" maxOccurs="1"/>
<xsd:element ref="Year" minOccurs="1" maxOccurs="1"/>
<xsd:element ref="Cases" minOccurs="1" maxOccurs="1"/>
<xsd:element ref="Deaths" minOccurs="1" maxOccurs=""/>
</xsd:sequence>
</xsd:complexType>
</xsd:element>
<xsd:element name="ICD10" type="xsd:string"/>
<xsd:element name="Year" type="xsd:string"/>
<xsd:element name="Period" type="xsd:string"/>
<xsd:element name="Cases" type="xsd:string"/>
<xsd:element name="Deaths" type="xsd:string"/>
</xsd:schema>
98
Sample XML file that is valid and well formed against the above XML schema Health Sector
Reform Technical
Assistance Project
<wdcr>
<country>Philippines</country>
<data>
<period>July</period>
<disease>AFP</disease>
<year>2001</year>
<cases>8</cases>
<deaths>0</deaths>
</data>
<data>
<period>August</period>
<disease>AFP</disease>
<year>2001</year>
<cases>6</cases>
<deaths>0</deaths>
</data>
</wdcr>
PhilHealth needs to address the creation of electronic forms using any or both of
these options. Subsequent steps in electronic claims processing are dependent
on the submission of data in XML format.
3.3 Filling out of the electronic form
With an existing electronic form produced by PHIC or with a published XML

Schema as reference, claimants may then file using either option and submit the
claim in machine readable XML format to PhilHealth. As in the manual paper
based form (filling out, mailing, courier, etc), the cost of filling out of the electronic
form is absorbed by the claimant (Internet connection, computers, etc). It is not
advisable for PhilHealth to accept paper forms and encode them into the
electronic forms in order to avoid issues with claims integrity and accuracy.
3.4 Submission of electronic form to PHIC
Upon filling out of the electronic form, the claimant then submits it electronically
to PhilHealth. Again, there are two non-mutually exclusive options here.
PhilHealth may provide dedicated telephone lines for such transactions, or it may
accept submissions over the Internet. In either case, issues on confidentiality,
integrity, non-repudiation, and authentication must be addressed. It should be
noted that the E-Commerce Act would be relevant to all electronic transactions
including claims processing by PhilHealth.
3.5 Internal processing system
Receipt and acknowledgement of electronic form (by PHIC). The receipt of the
electronic claim by PhilHealth technically begins the electronic data interchange
(EDI) part of the process. Electronic Data Interchange (EDI) is the exchange of
business documents between computers of disparate information systems, using
a public standard format. Instead of paper or fax as means of sending and
acknowledging receipt of data, EDI users directly exchange data between their
respective computer systems.
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The receipt and acknowledgement of the electronic form is an important part of Health Sector
Reform Technical
the process. This is where the recipient, PhilHealth, acknowledges that it has Assistance Project
received the electronic claim as submitted by the claimant. At this point,

PhilHealth checks for authentication, integrity, and confidentiality. Once it
acknowledges the electronic submission, PhilHealth will then be bound by the
principle of non-repudiation. From then on, all subsequent processes will be
internal to PhilHealth.
Processing of electronic form using existing business logic. The Claims Process
can be seen as a series of logical processes that perform specific functions with
the output of previous steps serving as input for the next. Some processes are
mechanical (e.g., counting claims, time-stamping, logging, checking for
completeness) while others require higher degrees of decision-making (“Is this
drug reimbursable for the type of diagnosis given?”). While mechanical
processes may be replaced with automation, those that require people to make
decisions based on input may need more complex methods like computer
algorithms.
A first level of algorithm is to check for data completeness. This is easily

implemented using the XML schema. The electronic file (XML) that is submitted
is matched against the XML schema and it can be instantaneously determined if
the XML file submitted is valid and well formed. If it is not, an error message may
be sent back to the claimant informing them that the claim is being refused for
the cited reasons.
For more complex reasoning, there are several ways of embedding logic in
computer algorithms. "Boolean operators" (yes or no) are the easiest to
implement among algorithms. These operators act as gatekeepers of process
flow redirecting the process flow to only one of two possible options (e.g. "Black"
or "Not black"). Dichotomous decision points ("to reimburse or not to reimburse")
will employ Boolean operators. "Switch-case" algorithms may be used when
more than two types of input are expected. In switch-cases, a default scenario
must be set if the input does not match any of those expected. However, even
complex decisions may be simplified into sequential Boolean operators (e.g.
"Red" or "Not red" then "Orange" or "Not orange" and so forth and so on until you
reach your color of choice). "Neural networks" are more complex methods of
machine learning that apply fuzzy logic in their implementation. The “Arden
Syntax”, which uses Medical Logic Modules (MLM), may also be employed.
However, MLMs may be too sophisticated for the needs of PhilHealth. MLMs are
better suited for on-the-spot clinical decision making and not for evaluation of
reimbursement for claims. For the needs of the PHIC, the simple, concrete, and
reproducible results of Boolean operators and switch-cases may be better
options. The choice of algorithms to implement the business logic will depend on
the business rule itself.
Boolean operation
if (color =="Black") {print "You have chosen black."; }

else {print "You did not choose black.";}
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Switch-case
Health Sector
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switch(color): Assistance Project
case(Black) {print "You have chosen black";

break; }
case(Red) {print "You have chosen red";
break; }
case(default){print "You did not choose a color"; )
Since this study is about clinical practice guidelines, let us use CPGs as an
example.
Since CPGs deal mainly with clinical data, they will have most impact in the
workflow of the Section of Medical Evaluation (see Flowchart). Presently, much
of the decision making by the medical evaluators are subjective and prone to
inter- and intra-rater variability. In addition, there is limited audit and post-
evaluation analysis for quality assurance.
Doctors currently use stocked knowledge and PHIC guidelines in assessing if the
claim is clinically sound. After this, the annotated claim is passed on to the next
processes where calculations and necessary paperwork are made for
reimbursement. The process is very subjective and prone to inter- intra-rater
variability.
If medical evaluation is computerized, an algorithm may be designed such that if

the ICD code in a claim falls within a particular scope (UTI, Hypertension, or
Community Acquired Pneumonia), the claim is made to pass through progressive
algorithms to assess Operations, Medications, Ancillary procedures, Room and
Board (see Figure). In each of these areas, CPGs already have clear parameters
as to which are applicable and clinically valid. For example, in the Medications
module for Urinary Tract Infection, the algorithm can flag only those drugs that
are considered valid. This flagging can be done in the other areas (Operations,
Room and Board, Ancillary Procedures) automatically based on the rules set by
the algorithm. In the end, only the costs of those flagged by the algorithm will be
computed for reimbursement.
Presentation of status of electronic claim (Approved, Return to Hospital, Denied).

A simple web server interface from the claims database can be easily setup to
provide the public with the status of their claims (similar to the tracking system
provided by FedEx).
3.6 Principles of Electronic Transactions
The E-Commerce act of 1999 clearly states the validity of electronic files
business transactions. Unlike paper based transactions where signatures and
notarizations may suffice, computerized transactions require higher standards
because of the ease in manipulating and duplicating electronic files without
leaving evidence of tampering. For electronic transactions, validity is dependent
on the observation and proper implementation of the following principles:
Identification and Authentication
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Integrity
Non-repudiation Health Sector
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Confidentiality Assistance Project
Encryption
• Identification and Authentication: Determining whether individuals or systems

are who they say they are.
Identification is the process of recognizing an individual in a transaction, for

example by a unique user name. Authentication is the process of verifying the
identity of a user or system. For example, a computer network user enters a
user name for identification to the network server along with a password for
authentication.
• Integrity: Providing assurance of the accuracy of the content and its source.
Maintaining the integrity of information ensures that data will not be modified
by unauthorized persons during storage or transmittal.
• Non-repudiation: The ability of the recipient of a transaction to prove to a third

party that the sender really did send the message.
Non-repudiation ensures that no party in a transaction can deny involvement

in the transaction. For example, imagine you purchase 1,000 shares of stock
at $100 per share on Monday and then decide to sell on Tuesday when the
stock goes up to $110 per share. If you could not claim non-repudiation, the
broker could say he had no record of the transaction, and it would be tough
for you to prove the transaction took place. To provide full non-repudiation, all
parties must be identified and authenticated; all parties must be authorized to
perform the functions required; the integrity of the transaction content must
remain intact throughout the entire process; certain transaction information
needs to be confidential for authorized users only; and all transactions must
be fully audited.
• Confidentiality: Keeping the contents of a transaction private.
Acquisition and strategic business plans, intellectual property, nuclear

weapons, patient lists: these are all examples of items that organizations
would not want to fall into the hands of unauthorized users who could
intentionally or unintentionally cause harm to them. Confidentiality is the
process of keeping information secret from all but those who are authorized
to see it.
Encryption is one mechanism of assuring confidentiality. By scrambling the

electronic document in such a way that only source and recipient, after proper
authentication, can open it, confidentiality may be guaranteed.”
(http://www.amscatalyst.com/sections/techtionary.asp?issue_id=3)
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4. Integrating Electronic Filing into PHIC
Health Sector
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Electronic Filing should be seen more as an adjunct rather than a replacement Assistance Project
for the current manual process of claims processing. Since many of the steps in
the manual process will be removed (e.g., logging, printing of LCR, transmittal
slips, vouchers, etc), there will be less manpower needed to process a claim. But
since it will require significant workflow engineering, we suggest that electronic
filing be done at parallel with the existing manual system.
The PMAC (PHIC Member Assistance Center) will still receive paper based
claims. This is because the supporting documents needed for a claim cannot be
submitted electronically (marriage certificate, birth certificate, receipts, etc).
These claims may then be directly forwarded to Initial Verification who scans the
barcode on the claim. The barcode will call up an electronic checklist of
supporting papers required for the claim. Verifier will document on the computer
terminal if papers are available.
4.1 Effect on turn around time, output rates, and manpower needs
The most immediate impact of electronic filing is in decreasing the time for RTH
and Denials. It will also shorten to a lesser degree turnaround time for approved
claims. By passing the electronic claim through preset algorithms, human
intervention is eliminated at several steps. Turn around time for explicit
deficiencies in claims (no member type, no member ID, no ICD code, etc) will be
almost instantaneous. This in fact is most beneficial for RTH and denied claims
that presently go through the full claims process even if deficiencies are noted
early on.
If CPGs are integrated into the algorithms, the system can be given permission to
automatically process and reimburse (pending receipt of supporting documents)
without need for a medical evaluator. In instances where there are deviations to
the CPGs, the claim may be tagged for manual processing. In any case, the load
of claims reaching the Section of Medical Evaluation will be decreased.
Output rates will be increased with possibility of no backlog at the end of the day
for any section where the business rules have been clearly applied. In instances
where there are problems in applying the business rules, the claims may be
tagged for manual evaluation.
The principles of electronic transactions (identification, authentication, integrity,

confidentiality, and non-repudiation) may be applied in electronic filing. The first
four are applied by the claimant whereas non-repudiation is best applied by a
trusted third party. There are many software available that may be used for
identification, authentication, integrity, and confidentiality. Examples are Pretty
Good Privacy (PGP) and GNU Privacy Guard (GPG). These software use the
public key infrastructure (PKI) and a trusted third party is required to authenticate
the users of PGP or GPG.
Non-repudiation is more social engineering and it just requires a trusted third

party who will verify that a file (regardless of completeness) has been submitted
by a claimant and that it has been received by PHIC.
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4.2 Alternatives Health Sector
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Assistance Project
Presently, paper based claims are not checked for validity of identification nor are
they authenticated beyond signatures. When a Jose Rizal submits a claim, there
is currently no system to determine if this Jose Rizal is really the one claiming or
is it just an impostor trying to fool the system. Claims are accepted at PMAC at
face value. There is also no confidentiality as anyone who gets hold of the claim
can easily read the information, and integrity cannot be assured as there are
numerous opportunities for people with malicious intent to alter claims content.
Electronic filing should resolve many of the deficiencies of manual paper based
transactions. By using a public key infrastructure, files may only be opened and
modified only by authorized recipients who have matching private and public
keys. By using encryption, unauthorized personnel who gets hold of the file will
not be able to understand it as it is encoded in cryptic format. Any attempt to
open, read, or modify the encrypted file will be detected by PGP or GPG and
invalidate the transaction for potential breach of integrity. All of these checks may
be done instantaneously and breaches immediately fed back to sender or
receiver allowing them the opportunity to rectify the error at the soonest possible
time.
The five principles of electronic transaction should ideally be implemented

however, there will be corresponding costs for applying the abovementioned
technologies. An alternative is to do electronic filing but not to implement since
they are currently not implemented in the manual system anyway. We will then
be using “unprotected electronic files”.
It should be noted that, unlike paper files, unprotected electronic files can be
easily disseminated and duplicated over networks. It will also be difficult to
pinpoint responsibility if there are errors in the file as there is poor identification
and authentication. The five principles should therefore be implemented even if
there will be a corresponding cost. We need to protect the confidentiality of the
transaction and make the sender or receiver accountable for breaches in integrity
and confidentiality. The PhilHealth will open itself to more opportunities for
litigation if the five principles are not applied adequately.
4.3 Experience in other countries
Many countries have successfully applied electronic filing of health claims.

Examples are EDIHealthcare.com and Healtheon/WebMD. These services offer
web-based claims submission services and status monitoring for a fee. It should
be noted that what these services do is to facilitate the data flow between
claimant and insurer. Assumptions then are that there are existing information
systems at both sides. The EDI agent simply facilitates the data transfer.
Business rules, especially those that were developed in-house, will not be carried
out by these services. The consumers of these services are mostly health
practice groups and hospitals as these services shorten reimbursement time.
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4.4 Risks
Health Sector
Reform Technical
There are risks expected if electronic filing is applied at PHIC. Assuming the Assistance Project
principles of electronic transaction will be observed, the first problem will be the
re-engineering of human resources to adapt to the new system. Training will be
required especially for people in accounting since much of their efforts will now
be based on decisions made by a computer.
Another problem is acceptance by claimants. However if they will see that their
payments arrive much earlier because they claimed electronically, they will be
swayed to apply the technology.
Unreliable trusted third party can detract the benefits of electronic filing. If the
third party is unable to confirm receipt of the file or delays responses from the
system, there will be mistrust among the users of the system.
4.5 Implementation Strategy and Timetable
The creation of an in-house eFile Team is necessary to be headed by a Project

Manager. The eFile Team will be composed of one complete team as required
for manual claims processing and personnel from the MIS. The eFile Team will
design and develop the software for the electronic filing system.
Another group will develop the XML Schema for PHIC claims together with the
NIH Study Group on Standards for Health Information. Using a consensus
process, a final XML schema should be produced in three months.
Parallel implementation with the manual system and selected hospitals should be
done to allow for data gathering and prototyping. The following timetable (in
months) may be followed:
1 2 3 4 5 6 7 8 9 10 11 12
Creation of eFile team (in-house)
Creation of electronic form
Consensus on XML schema (NIH SHIP)
Training of eFile team
Development of computer algorithms
Alpha testing (past claims)
Evaluation and refinement
Beta testing
Acceptance of electronic XML files
4.6 Consultation with service providers
Once the decision to-do electronic filing has been made, consultation with
domain experts are recommended. These are people with strong background in
electronic data interchange and in the culture of electronic transactions in the
Philippines.
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4.7 Systems analysis and software development
Health Sector
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A preliminary period of data gathering is needed to understand the functional Assistance Project
requirements of electronic filing. From these data, a design for a prototype is

created and created by a team of programmers guided by the eFiling Team.
Pilot testing. Pilot testing will be done in two phases: an alpha phase where past
claims are encoded by in-house staff and run through the computer algorithms. A
comparative analysis of reimbursement using manual and electronic algorithms
will be made. A second beta testing phase will be done with select volunteer
hospitals.
Launching and roll out. Once bugs in the electronic filing system are identified
and fixed, and the system is stable, the service may be rolled out for use by any
hospital/claimant in the country.
5. Costs
5.1 Initial investment
The initial investment will be spent mostly on systems analysis and design.
Software development may be outsourced to an external company. A significant
expense will be on the licensing of the relational database management system
(Oracle).
5.2 Ongoing operating costs
Operating costs will be for the following:
Human resource:
• Initial verification personnel (same as current)
• PMAC (same as current)
• M.I.S. for software maintenance (backup)
• M.I.S. for troubleshooting
• Systems analysts
Hardware:
• Linux 8 node cluster
• Workstations for development (5)
• Bar code reader (1 per initial verification person)
Software:
• Linux operating system
• Oracle 9i for Linux
• Adobe Acrobat 5.0
• Barcode generator software
• Barcode reader software
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5.3 Differential analysis with current operations.
Health Sector
Reform Technical
Electronic filing, with its computerized algorithms will be able to skip the following Assistance Project
existing manual processes: Receiving, Encoding, Initial Verification, Adjudication

1, Adjudication 2, Accounting, The cost of electronic filing will depend on how
much of the recommended steps are taken by PhilHealth. More detailed cost
estimates are as follows:
• Creation of electronic forms
Option 1: If PhilHealth will create its own forms, the estimated expense will be
$500 for software and $1000 for programming (one-time). Upgrade costs may
be $1500 per year.
Option 2: If PhilHealth will publish an XML Schema as a reference standard,

it should do this on a consensus basis with other stakeholders in the industry.
Three to four sessions at P10, 000 each will suffice (venue, snacks,
conference materials, etc). Honoraria are at P25, 000 per session for three
experts/facilitators per session. Publication costs may reach P25, 000 for
paper. It may be freely distributed over the Internet.
• Filling out of the electronic form
No cost to PhilHealth.
• Submission of electronic form to PHIC
Option 1: P2500 per dedicated telephone line; two lines at P5000 per month
Option 2: PhilHealth may use existing Internet Service Provider
• Receipt and acknowledgement of electronic form
This is where most of the costs will appear. The principles of authentication,
integrity, confidentiality, and non-repudiation must be implemented beginning
at this point. Third party companies offer this (TrustE, Thawte, Verisign,
WebTrust) in varying degrees. It is also possible to develop this in-house
(Pretty Good Privacy, GNU Privacy Guard which employ public key
infrastructure). PGP is commercial software. GPG is open source and is
freely available. If PhilHealth opts for GPG, the costs will only be for
programming (P200, 000 one time).
EDI Healthcare, a claims clearinghouse in the US charges $ 0.29 per claim.

We may also use this as basis for costs.
• Processing of electronic form using existing business logic
Another source of expense will the development of the computer algorithms,

and their maintenance. The existing expense for in-house systems analysts
may suffice for this but a development cost of $1000 per month for one year
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may be needed for two analysts dedicated to developing, monitoring, and
evaluating the performance of the algorithms. Health Sector
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Assistance Project
• Presentation of status of electronic claim (Approved, Return to Hospital,

Denied)
This can be absorbed easily by the existing web page maintainers of

PhilHealth. A one-time estimate of P100,000 may be allocated for this.
A standard initially established during the 1970s, managed and administered

by the Uniform Code Council, Inc. (UCC), EDI standards specify the format
and data content of standard business transactions. Unfortunately, no
specific EDI standard has been set for the healthcare industry to date. In the
US, as a way of cutting claims costs, more payers are moving to EDI for
incoming claims. The current trend is now to provide EDI access down to the
level of the physicians.
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Health Sector
XII. Business Process for Claims

Reform Technical
Assistance Project
Processing Information System
1. Context Diagram
MEMBERSHIP ACCREDITATION
AND AND QUALITY
CONTRIBUTION ASSURANCE
GROUP GROUP
Hospital
Charges
Membership & Accredited Health
Contributions Info Provider Info.
HEALTH Claims Directly Filed
PROVIDER Claims PHIC
MEMBER
Denial Letters
Deficient Claims Claims Check
Payments
Claims Fund Transfer/ CLAIMS

Credit Advice
ELECTRONIC Various
Accounting
ACCREDITED Reports
DEPOSITORY FMIS
BANK
Appealed
Post Audit Claims Claims
Requirements Review
Result
Claims
Review
COA Unit
(CRU)
CLAIMS PROCESSING SYSTEM FUNCTIONAL CONTEXT DIAGRAM
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2. Functional Chart Health Sector
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Assistance Project
CLAIMS
RECEIVE AND VERIFY PERFORM MEDICAL

PROCESS CLAIMS
CLAIMS ONLINE EVALUATION
PROCESS
PROCESS
REGULAR
PENDED CLAIMS
CLAIMS ONLINE
CLAIMS PROCESSING SYSTEM FUNCTIONAL HIERARCHY DIAGRAM
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3. Processes Health Sector
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Assistance Project
Health Premium
CLIAMS Members Claims
Providers Payment
PROCESSING
DEPARTMENT
Member/
Dependent
CLAIMS
RECEIVING
DIVISION
YES YES YES YES Endorse
Dependent Health Contri- Confine- YES
New Date filed Claims for
Indigent Provider butions ment
Claims on time? Medical
Status NO OK OK Days OK
NO NO Evaluation
NO NO
RECEIVE & VERIFY CLAIMS ONLINE
3.1 Process – Receive and Verify Claims Online
a. Verify if Claim is filed on Time
• Description:
This process aims to verify if the claim was filed within sixty (60) calendar
days from the day of discharge of the patient. Otherwise, the claim shall
be barred from payment except in cases of natural calamities.
If the claim is submitted online, the date of entry in the remote site shall
be considered as the date of filling.
Filing Time wherein sixty (60) day falls on a Saturday / Sunday should be
considered
Claims not filed within the statutory period shall be accorded an additional
thirty (30) calendar days provided that a certification was issued by the
concerned local authority relative to the existence of calamity that caused
the delay. (see Section 52 of PHIC’s IRR).
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• Location:
Health Sector
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Any site with access to PHIC’s Claim’s Processing Computer System Assistance Project
• Inputs:
Validated PHIC ID and Date of Discharge
• Outputs:
Validated Date of filling with statutory period
• Business Rules Specifications:
If the difference between the Date of Discharge and the date of Filling
exceeded 60 days, the claim will be denied, except in cases of natural
calamity or when the 60th day falls on a Saturday, Sunday or Holiday. The
claim however will still be processed up to Adjudication before denial
letter is prepared.
b. Verify Member/Dependent/Indigent Status
• Description:
This process is the initial step in verifying a claim submitted online by the
Health Provider. It aims to verify the following:
- Check if the PHIC member ID number is valid

- PHIC ID is not currently subject to penalties as provided for in Section
44 of the National Health Insurance Act
• Location:
Any site with access to PHIC’s computer system
• Inputs:
PHIC ID or Name of Member/ Dependent/ Pensioner/ Indigent and Date

of Birth
• Outputs:
Member/dependent status certification, (Checking of qualified

dependents)
This process will provide the go-signal if a claim will proceed to the next
step in processing a claim. If the validation step in this process cannot be
satisfied, the claim will automatically be rejected by the system.
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c. Verify Health Provider Status
Health Sector
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• Description: Assistance Project
After the identity of the claimant is established by the process “VERIFY

MEMBER/ DEPENDENT/ INDIGENTS STATUS”, the system will
determine if the health care provider submitting the claim is accredited.
• Location:
• Inputs:
Validate PHIC ID and PHIC Accreditation Number
• Outputs:
Status of accreditation of Health Provider
If the health care provider accreditation status is not active or invalid, then
the claim submitted will be rejected by the system.
Emergency – Hospitals and Doctors not accredited with PHIC are still
processed by the system provided that the hospital has a Department of
Health License and the case is emergency
d. Verify Qualifying Contributions
• Description:
If the member’s PHIC ID is verified and the employer ID is active and

valid (for employed members), this process will check if the member has
met the following condition:
Within six months prior to the first day of availment, at least three (3)
consecutive monthly contributions of a paying member must have been
paid in full. If covered through the OWWA, he must have enrolled and
paid his required annual contributions. – Section 44 of PHIC’s IRR.
• Location:
• Inputs:
Validated PHIC ID and Employer PEN (The last requirement is only for
employed member)
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• Outputs:
Health Sector
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Qualifying Contribution of member (applies to Indigent Program Assistance Project
members, to employed and individually paying member)
If the member does not meet the qualifying contributions for availment of
PHIC’s benefits, then the claim request will be denied. This concern is
very much dependent upon an on time posting of contribution.
If employed do not deny immediately because under Rule III Sec.20 C –

Failure and/ or refusal of an employer to deduct/ remit premium
contribution shall not be the basis for denial of a properly filed claim
e. Verify Remaining Confinement Days
• Description:
This process aims to verify if the 45-day room and board allowance for
the calendar year has not been consumed. The Claims Processing
updates and monitors the balance of the 45-day room and board
allowance per member and the other 45 days to be shared by all of its
dependents.
(Same illness with in 90 days should also be verified and tagged by the
system so that the allowable benefit balance for that period can be
verified)
• Location:
• Any site with access to PHIC’s Claim’s Processing Computer System
• Inputs:
Validated PHIC member ID and contribution premium requirements.
• Outputs:
Balance of the 45-day room and board allowance of the member or his
dependents.
If the member or his dependents whatever the case maybe, has already
exceeded the 45-day room and board allowance, the claim should be
denied. If the confinement period of the current claim exceeds the
remaining balance of his confinement days, the claim will be limited to the
remaining balance of the member or his dependents.
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f. Endorse Claim for Medical Evaluation
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This process prepares claims to proceed for medical evaluation.
• Location:
PHIC Claims Processing – Receiving Section
• Inputs:
Pre-validated claims as to membership eligibility
Pre-validated Providers claims as to accreditation status of attending

providers
Technology use (soft or hard copy)
• Outputs:
Batch of claims for medical evaluation.
The date the claim was identified as ready for medical evaluation should
be recorded. This milestone in claims processing should be monitored by
PHIC claims processing supervisors.
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Health Sector
Hospital Reform Technical
Claims
Assistance Project
Processing records on
Department line
Medical
Evaluation
Division
Claims Drugs/Medicines Yes

Access Illness Case
endorsed for ICD-10 RVS ------------------------- (allow)
hospital Compen type
medical Code OK 1.Generic
records sable OK
evaluation -------------------------
2. PNDF/
Positive list
-------------------------
NO NO
3. Negative list
_______________
higher lower higher lower Supplies/Others
Compensable(?) Endorse to
_______________ adjudication/
Adjust Laboratory processing
computation of Compensable(?)
benefits
No
lower lower (disallow)
Reduction
Reduction report
code change
PERFORM MEDICAL EVALUATION
3.2 Process – Perform Medical Evaluation
There should be a tracking system for every claims process from one person to
another. Tracking system should be included in all levels of the system.
a. Review Medical Information/Data
• Description:
Access hospital record to validate claim data with hospital data for
accurate assignment of ICD-10 code, RVS and Case-type
• Location:
Medical Evaluation Section
• Inputs:
Hospital records on line

Claims endorsed by Receiving Division
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• Outputs: Health Sector
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Assistance Project
Validated ICD-10 codes, RVS, case-type
Claims without ICD-10 code shall be denied
Any changes made by the Medical Evaluator in assigned RVS or in case-

type shall automatically adjust the allowable benefit. Claims with lowered
RVS or case-type should be tagged with corresponding reduction code.
b. Assess Compensability of Claim
• Description:
This process determines whether the illness or the surgical procedure

being claimed may be compensated
• Location:
PHIC Claims Processing – Medical Evaluation Division
• Inputs:
Claims with validated ICD code
• Outputs:
Identification of compensable and non-compensable claims
This process specifically determines the compensability of the illness or

the procedure in the claims. Claims for services listed under IRR sec. 45
as exclusion to benefits should be denied.
c. Evaluation of Drugs and Medicines, Supplies, Laboratories and Others
• Description:
Determine which drugs and medicines, supplies, laboratories and others

may be compensated based on existing policies
• Location:
Medical Evaluation Section
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• Inputs:
Health Sector
Reform Technical
Compensable claims Assistance Project
• Outputs:
Claims with non-compensable drugs and medicines, supplies,

laboratories and others, reduced
Identification of compensable drugs and medicines are as follows –
- Drugs should be written in Generic terminology

- Those included in the PNDF and PHIC positive list
- Those not in the negative list (delisted drugs or deleted drugs)
Identification of compensable supplies, laboratories and others can be

referred to a listing in CPG or other standards prescribed.
All the reasons for adjustment or changes in the allowable benefit shall be
recorded and listed in reduction report form. The report shall be
generated in duplicate as PHIC file and for hospital reference.
Endorse claims for adjudication.
Claims Agency
Claims
Processing
Department
Regular Claims
Segregate
good
Prepare Submit to
Claims
Compute Voucher accounting
Adjudication Charges
Division on-line
Claims
for
Validate Claims compliance/
denial
All new Claims Vs
Benefit Package
Generate
compliance/denial Return to Sender
letter
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ADJUDICATE REGULAR CLAIMS ON-LINE
Health Sector
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Assistance Project
Check payment
(Treasury)
Accounting
Division
Vouchers from Certify fund Update payment
Voucher review Paid claims for file
Adjudication Division availability file on-line
Benefit Notice
Notice to member Notice to Hospital
3.3 Adjudicate all Claims Online
a. Validate Claims against Benefit Package
• Description:
This process validates the existence and correspondence of claim from

the reference table of benefit packages.
• Location:
PHIC Claims Processing Department, Adjudication and Review Division
• Inputs:
All evaluated claims
119
• Outputs:
Health Sector
Reform Technical
The corresponding benefit package of the claim to be used in the Assistance Project
computation of claim charges
The reference table of benefit packages must be established in order to

ensure the validation of each claim.
b. Compute Charges (For Good Claims)
• Description:
This process computes the total charges of a claim. Online computation

will be used.
• Location :
PHIC Claims Processing Department, Adjudication Department
• Inputs :
Claims benefit package and the actual charges
• Outputs:
The total amount of claim benefits for hospital, doctor and member.
Prior to computation of charges claim records on and other expenses

must be gathered and claim must be validated from benefit packages.
Denied claims, claims for compliance shall be segregated and returned to
sender.
Return to Sender –
* Description:
The process generates a letter informing the claimant that the claim
submitted has deficiency/ies or is denied. For claims with
deficiency/ies, the claimant should comply with PHIC requirement as
stated in the letter, to resume processing of his claim.
* Location:
* Inputs:
Verified, evaluated and reviewed claims
120
* Output:
Health Sector
Reform Technical
Compliance letter addressed to claimant Assistance Project
Denial letter addressed to claimant
* Business Rules Specifications:
The status of the claim for compliance should be “pended” and will be
queued in the file of pended claims. The deadline for complying with
the requirement/s of PHIC, which is sixty (60) days from receipt,
should be indicated in the letter.
Denial letter should indicate option to appeal and where to file the
appeal.
Should the claim be refiled, the system should be able to identify

previous application made by the claimant for the same confinement.
c. Prepare Voucher
• Description:
This process prepares voucher for payment to individual members/

hospital/ doctor.
• Location:
PHIC Claims Processing Department, Adjudication Division
• Inputs:
Claim No., Voucher No., Voucher Date, Quantity, Item Description, Item
Amount, and Total Amount
• Outputs:
Voucher for review and certification
The preparation of voucher will be based upon the total charges and
benefits to be given to direct filers/ hospital/ doctor. Endorsement to
Accounting.
121
3.4 Accounting Processes
Health Sector
Reform Technical
a. Review and Verify Voucher Assistance Project
• Description:
This process specifically reviews and certifies a voucher as to fund

availability
• Location:
PHIC Claims Processing Department– Accounting Division
• Inputs:
Prepared Voucher
• Outputs:
Certification of Voucher
This will only be done after the preparation of voucher. The accounting
section reviews the information in the voucher before certification is finally
issued.
b. Update Payment File
• Description:
This process updates the payment file of PHIC per claim record.
• Location:
PHIC Claims Processing Department, Accounting Division
• Inputs:
Computed total charges of claim
• Outputs:
Payment file is updated
• Business Rules Specification:
There exists one payment file per claim record. Payment details will be
reflected on payment file, which includes payment to hospital, doctor and
member. Treasury picks up and arrange payment with the bank.
122
Generation of Benefit Notice –
Health Sector
Reform Technical
* Description: Assistance Project
This process generates Benefit Notice to member and provider

(hospital and/ or physicians)
* Location:
Accounting Division
* Inputs:
Computed total charges
* Outputs:
- Benefit Payment Notice to member

- Notice of Payment to Doctors
- Notice of Payment to hospital as the case maybe
* Business Rules Specifications:
This will be done after payment has been updated. The claims
(physical or hard copies) are considered paid and are prepared for
filing.
3.5 Process Pended Claims
a. Manually Adjudicate Claims
• Description:
This process reviews pending claim, which is manually done by a claim

processor.
• Location:
PHIC Claims Processing Group
• Inputs:
Claims that are classified as pending
• Outputs:
Adjudication report for validation of claims against benefit package and

for claims payment.
123
•
PROCESS PENDED CLAIMS
CLAIMS
PROCESSING Benefit Claims
Claims
GROUP Package Payment
Validate
Manually Claims Update
Claims
Pended Adjudicate Against Payment
Compute for
Claims Claims Benefit File
Charges Payment
Package
Business Rules Specification:
Claims for
124
Payment YES
?
Prepare
Voucher
NO
Letter of
PROCESS PENDED CLAIMS

Advice to
Prepare Letter
Health
on Status of
Provider
Claims
source documents and other pertinent information of claim.
The claim processor reviews and corrects validation report based on
Health Sector
Reform Technical
Assistance Project
b. Verify Claim Payment
Health Sector
Reform Technical
This process checks if a claim is ready for payment after which the former
is manually adjudicated.
• Location:
• Inputs:
• Outputs:
Claim payment certification
Payment verification status whether to prepare Letter of Advice to

PhilHealth Provider or to proceed to validation of claims against benefit
package.
c. Validate Claims against Benefit Package
• Description:
This process validates the existence and correspondence of claim from

the reference table of benefit packages.
• Location:
• Inputs:
• Outputs:
The corresponding benefit package of the claim to be used in the

computation of claim charges.
The reference table of benefit packages must be established in order to

ensure the validation of each claim.
125
d. Compute Charges (For Pended Claims)
Health Sector
Reform Technical
This process computes the charges of a claim.
• Location:
• Inputs:
Claims benefit package and the actual charges
• Outputs:
The total amount of claim benefits for hospital, doctor and member
Prior to computation of charges, claim records on drugs, medicines,

laboratories and other expenses must be gathered and claim must be
validated from benefit packages.
e. Prepare Voucher
• Description:
This process prepares voucher for payment to individual members
• Location:
PHIC Claims Processing – Accounting Section
• Inputs:
Claim No., Voucher No., Voucher Date, Quantity, Item Description, Item
Amount, and Total Amount
The preparation of voucher will be based upon the total charges and
benefits to be given to direct filers.
f. Review and Certify Voucher
• Description:
This process specifically reviews and certifies a voucher
126
• Location:
Health Sector
Reform Technical
PHIC Claims Processing – Accounting Section Assistance Project
• Inputs:
Prepared Voucher
• Outputs:
Certification of Voucher
This will only be done after the preparation of voucher. The Accounting
Section reviews the information in the voucher.
g. Update Payment File
• Description:
This process updates the payment file of PHIC per claim (Fund transfer is
being done by Treasury Department to the Bank (payroll System)
(payment notices are send after transmittal to the bank) (generates
notices and transmittal at same times)
• Location:
• Inputs:
Computed total charges of claim
• Outputs:
Payment file is updated
There exists one payment file per claim record. Payment details will be
reflected on payment file, which includes payment to hospital, doctor and
member.
127
3.6 Benefit payment to members/ check generation/ direct payment
exceptional case only Health Sector
Reform Technical
Assistance Project
a. Request for Adjustment of Claims
• Description:
Request for payment of underpaid hospital charges, Professional Fee,

Medicines bought outside
• Location:
PHIC Claims Processing Department
• Inputs:
Claims paid vs. Adjusted Claims
• Outputs:
Claims paid file
Request for adjustment should be received with in sixty (60) days upon
receipt of payment
NOTES: This description is from a section of the PHIC Information System

Strategic Plan, 1999-2004, from the Office of the Vice-President of Health
Finance Policy and Services Sector. We include it here to show how many of
the software requirements of our proposed Levels 0 to 4 workflows have
independently been conceptualized in the Information System Strategic Plan.
This includes systems to:
• Receive and verify claims online

• Perform medical evaluation
• Adjudicate regular claims online
• Perform accounting processes
• Process pended claims
• Pay benefits to members/generate checks/pay directly
128
Health Sector
XIII. Medical Logic Modules

Reform Technical
Assistance Project
The Arden Syntax specification covers the sharing of computerized health

knowledge bases among personnel, information systems and institutions. The
scope has been limited to those knowledge bases that can be represented as a
set of discrete modules. Each module, referred to as a Medical Logic Module
(MLM), contains sufficient knowledge to make a single decision. Contraindication
alerts, management suggestions, data interpretations, treatment protocols, and
diagnosis scores are examples of the health knowledge that can be represented
using MLMs. Each MLM also contains management information to help maintain
a knowledge base of MLMs and links to other sources of knowledge. Health
personnel can create MLMs directly using this format, and the resulting MLMs
can be used directly by an information system that conforms to this specification.
The Arden Syntax evolved from alerts- and reminder systems at LDS Hospital in
Salt Lake City (the HELP System), the Regenstrief Institute in Indianapolis (the
CARE System), Columbia Presbyterian Medical Center in New York (the first
Arden Syntax system), and several other academic efforts. The group first met at
the Arden Homestead in Harriman, NY, hence the name. The Arden Syntax was
born out of the realization that the power of these alerts and reminder systems
was in the knowledge, and that there was a need to make this knowledge
portable, shareable, between information systems. Many commercial vendors
adopted the standard and included it in their products.
The first version of the Arden Syntax was administered and issued by the
American Society for Testing and Materials ASTM. In 1998, the Arden Syntax
group became part of the Health Level Seven (HL7) organization, home of many
widely accepted standards in health care informatics. The Arden Syntax Special
Interest Group (SIG), sponsored by the Clinical Decision Support Technical
Committee within Health Level Seven, administers the Arden Syntax standard.
The general structure of the Arden Syntax are slots within three categories,
maintenance, library and knowledge. Within each slot, different representation
formalisms are taken. For example, in logic slot of knowledge category, if-then
rules is used to represent the logic of the MLM invoked, while in purpose slot of
library category, text is used to represent the purpose of the MLM. Following is
an example of an MLM2:
2
Hripcsak, George M.D., and Pryor, T. Allan Ph.D. Tutorial: Writing Medical Rules for Computers
Using the Arden Syntax for Medical Logic Modules. Copyright 1993. Columbia-Presbyterian
Medical Center website, accessed 2 December 2002.
<<http://www.cpmc.columbia.edu/resources/arden/tutorial.txt>>
129
maintenance: Health Sector
Reform Technical
Assistance Project
title: Screen for nosocomial urine infections.;;

filename: epi_urine;;
version: 1.03;;
institution: Columbia-Presbyterian Medical Center;;
author: George Hripcsak, M.D.
(hripcsak@cucis.cis.columbia.edu);;
specialist: ;;
date: 1993-04-28;;
validation: testing;;
library:
purpose:
Screen for nosocomial urine infections for the epidemiology department.;;
explanation: ;;
keywords: urine; culture; infection; nosocomial;;
citations: ;;
knowledge:
type: data-driven;;
data:
/* relevant codes
BLADDER ASPIRATION URINE CULTURE (2204)
CATHETERIZED URINE CULTURE (2206)
CULTURE AND SENSITIVITY OF SPECIMEN FROM LOWER URINARY TRACT,URINE/SEMEN (27929)
CULTURE OF SPECIMEN FROM LOWER URINARY TRACT, AND OF URINE AND SEMEN (27900)
URETERAL URINE CULTURE (2205)
URINE FUNGAL CULTURE (2197)
URINE, SLIDE AND CULTURE FOR FUNGI (2196)
130
VOIDED URINE CULTURE (2207)
Health Sector
BACTERIURIA SCREEN (2200) Reform Technical
Assistance Project
1019 NEGATIVE TO DATE

443 PLEASE CALL LABORATORY SUPERVISOR
2433 PLEASE CALL LABORATORY SUPERVISOR (X69118)
1034 NO GROWTH TO DATE
476 SPECIMEN LABEL AND REQUISITION MISMATCHED
472 QUANTITY NOT SUFFICIENT
404 QUANTITY NOT SUFFICIENT FOR BACTERIURIA/PYURIA SCREEN
468 NO SPECIMEN WITH REQUISITION
475 NO REQUISITION WITH SPECIMEN
____________________________________________________________
421 PLEASE SUBMIT REPEAT SPECIMEN AT NO CHARGE

465 PLEASE SUBMIT REPEAT SPECIMEN
402 PLEASE SEND REPEAT SPECIMEN
448 SPECIMEN NOT PROCESSED
467 SPECIMEN CONTAMINATED
469 CONTAINER CONTAMINATED
473 RECEIVED AFTER PROLONGED DELAY
382 PLEASE SEND A CLEAN-CATCH URINE AS SOON AS POSSIBLE
2416 URINE COLLECTED IN UNSTERILE (YELLOW-TOP) CONTAINER
1021 NOT SIGNIFICANT BACTERIURIA
2238 NO GROWTH
444 PROPER REQUEST FORM NOT SENT WITH SPECIMEN
445 SPECIMEN RECEIVED IN UNSTERILE CONTAINER
446 SPECIMEN NOT ADEQUATE FOR PROPER PROCESSING
425 MULTIPLE SPECIES (IMPROPER COLLECTION OR DELAY IN TRANSPORT)
478 IMPROPER SPECIMEN
436 CULTURE REINCUBATED
417 (SEND A NEW SPECIMEN IF YEAST IDENTIFICATION IS REQUIRED)
NEGATIVE FOR FUNGI

315 -> 985 FUNGI
131
1035 -> 1042 NEGATIVE FOR
Health Sector
*/ Reform Technical
Assistance Project
/* evoke on storage of a urine culture */

urine_culture_storage := event
{'32506','00002204'; '32506','00002206'; '32506','00027929';
'32506','00027900'; '32506','00002205'; '32506','00002197';
'32506','00002196'; '32506','00002207'; '32506','00002200'};
/* all the ways to get a negative urine culture */

negative_urine_codes := read {'pcodes'="null
'1019' '443' catenate '2433' catenate '1034' catenate
'476' catenate '472' catenate '404' catenate '468' catenate
'478' catenate '436' catenate '417' catenate "};
/* define prefix, culture, negative_for */

culture := read last {'pcodes'="null '315' "};
prefix := read last {'pcodes'="null '1035' "};
negative_for := read last {'pcodes'="null '1042' "};
/* read the culture results and prefix that evoked the MLM */
(urine_classes,urine_codes,urine_names) := read
{'evoking', 'dam'="PDQRES2",
'constraints'="C****", 'display_comp'="COV";
; 'exactly 315','1035'}
where it occurred before now + 1 minute;
____________________________________________________________
/* get last admit time before urine culture - 3 days (also test inpt) */
(caseno, discharge_status) := read last (
{'dam'="GYDAPMP", 'constraints'=" I***";
132
"HCASE"; "K"; "HPATSTAT"}
Health Sector
where it occurred before 3 days before time of last urine_codes); Reform Technical
Assistance Project
/* get discharge time for the case) */

discharge := read last
{'dam'="GYDAPMP", 'ret_key'="A", 'key'=caseno;
"HDISCHRG"; "HCASENO"};
/* get location */
location := read last
{'dam'="GYDAPMP", 'ret_key'="A", 'key'=caseno;
"HLOC"; "HLOCNURS"};
/* email for research log */

email_dest := destination
{'email', 'name'=
"mbfract@cucis.cis.columbia.edu,oconnoj@cpmail-nz.cis.columbia.edu"};
;;
evoke:
/* evoke on storage of a urine culture */
urine_culture_storage;;
logic:
/* exit if not inpatient */
if caseno is not present then
conclude false;
endif;
/* exit if urine culture was done after discharge */

if discharge_status <> "A" then /* not active = discharged */
if discharge occurred before time of last urine_codes then
conclude false;
endif;
endif;
133
/* make sure this is the allen pavillion */
Health Sector
allen_pavillion := Reform Technical
"AA01", "AA02", "AF2E", "AF2W", "AF3E", "AICU", "ANUR", Assistance Project
"AR1W", "AR2E", "AR2W", "AR3E", "AR3W", "0884";

if location is not in allen_pavillion then
conclude false;
endif;
/* separate cultures from prefixes */

culture_codes := urine_codes where urine_classes = culture;
____________________________________________________________
culture_names := urine_names where urine_classes = culture;

prefix_codes := urine_codes where urine_classes = prefix;
/* stop if there is a negation prefix (this may lose mult results) */

if negative_for is in prefix_codes then
conclude false;
endif;
/* check if culture is positive */

positive_urine_results := culture_names
where culture_codes are not in negative_urine_codes;
if exist(positive_urine_results) then
conclude true;
endif;
;;
action:
/* send email for research */

write "On patient admitted " ||time of caseno||
" to " ||location||
"\n\nurine culture on " ||time of last urine_codes||
134
"\n" ||positive_urine_results
Health Sector
at email_dest; Reform Technical
Assistance Project
;;
urgency: 50;;
end:
135

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Health Sector Reform Technical Assistance Project (HSRTAP)

Strategic Options for the Use of

Ateneo Graduate School of Business – Health Programs

A publication of Management Sciences for Health–Health Sector Reform Technical

4.2 FGD 2............................................................... 25 Reform Technical

V. Summary of Key Informant Interviews ...................................................... 26

Chiefs to Sections) ................................................................52 Assistance Project

6. Cost of Supplies ....................................................................53

6. Level 4 ..................................................................................86 Reform Technical

4.7 Systems analysis and software development . 106 Reform Technical

CPGs are developed by health professionals of a particular specialty society to

PhilHealth is already reviewing the use of CPGs, covering 10 high-cost types of

AGSB’s specific tasks included the following:

• To document and review current uses of CPGs in the Philippines, including

• To assess the readiness of providers and of PhilHealth in using CPGs;

• To develop a strategic plan presentation for PhilHealth to make informed

PART 2 contains the results of AGSB’s assessment of key PhilHealth business

a. To determine physicians’ readiness and willingness to use CPGs in their own

b. To generate suggestions on possible enabling and hindering factors to be

Two FGDs are planned, each group consisting of from 8 to 10 participants. A

With a working diagnosis of Urinary Tract Infection, Dr. Adriano decided to

• Laboratory Tests requested were more than what is prescribed by the

• The prescribed medicines were not the drug of choice as recommended

d. Are the reasons for rejection justifiable? Why or why not?

Reference: Philippine Society for Microbiology and Infectious Diseases

II. Key Informant

Different options on the use of CPGs by PhilHealth will only be successful in

c. To generate suggestions on possible enabling and hindering factors to be

In-Depth Interview Guide for Heads of Societies Assistance Project

• General Purpose of the Study

I would like to go over certain general rules for our conversation.

• There are no correct answers

Do you have any questions at this point?

What is your present position in your society/hospital?

C. PHIC and Your Private Practice

Are you PHIC-accredited?

(Now let us talk about more specific topics.)

What laboratory procedures do you think should be routinely reimbursed

What drugs do you think should be routinely reimbursed by PHIC?

(The advent of EBM has led to the development of Clinical Practice

G. Perceptions of Society Members on Clinical Practice Guidelines

Can you describe some of the perceptions of your society members on

• What do they think about CPGs?

Can you describe to us the role of the society in the development of

• What are the CPGs adopted or being supported by your society?

I. Dissemination and Promotion of Use of CPGs

How do you think CPGs should be disseminated and promoted among

• What activities were carried out by your society to disseminate and

Probe: Assistance Project

• What is the society’s stand on the incorporation of the CPGs in to the

III. Suggested Revisions

in the Research Protocol

Upon submission of the research protocol on February 25, 2002, a technical

In the light of these comments, a sub-amendment (Number 1) was signed and

The next activities of the team therefore focused on finalizing these

On 25 March 2002, a meeting was held among representatives of PHIC, MSH,

• Within PHIC's domain and mandate to implement after CPG development.

Weights Assistance Project

• Technically feasible 30%

Activity analysis, also known as value analysis, is an approach to operations

a. Identify the process objectives, as defined by what the customer wants or

c. Classify activities according to their value-added and efficiency aspects.

A value-added activity is an activity that, if eliminated, would in the long run