DOH Reengineering Monograph

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T H E N E E D F O R

H E A L T H R E F O R M S

◘

Historical Background

The Philippine Department of Health (DOH) has a long and distinguished history.

It began as the Board of Health on June 23, 1898 by virtue of a decree by the

new republic under President Emilio Aguinaldo. It has since evolved into one of

the major departments of government with a budget and personnel that has kept it

among the top five agencies of the executive branch. In 1999, under Republic Act (RA)

8745, it had an appropriation of about P12 Billion and a nationally paid workforce of

27,410 employees.

The past twenty years were marked with changes. In

1982, President Ferdinand E. Marcos reorganized the DOH

under Executive Order (EO) 851. This was done to

synchronize health structures and operations with th

shift to a parliamentary form of government. Instead

being referred to as DOH, it became known as the Minist

of Health (MOH)

e

of

ry

.

The Office of the President had control of the ministry,

with supervision provided by the Prime Minister. It wasalso accountable to the Batasang Pambansa or the parliament and to the cabinet to

ensure harmonization of health programs with the rest of the programs of government.

It was during this period that a State Minister for Health with the rank of deputy

minister was appointed from elected members of Parliament. However, its organic

structure remained basically unchanged. There was one line bureau, five staff bureaus,

seven project or technical offices, which focused on diseases or special concerns. They

were later renamed into technical services.

June 23, 1898 – Boardof Health

Pres. Emilio Aguinaldo

EO 851/1982 – Ministryof Health

Pres. Ferdinand E. Marcos

EO 119/1986 –Department of Health

Pres. Corazon C. Aquino

Chapter

1

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The Minister of Health at the same time

supervised a number of medical centers,

hospitals including those with research

functions and attached agencies such as

the Dangerous Drugs Board, the

Philippine Medical Care Commission and

the Schistosomiasis Control Council. For

service delivery, the hierarchy began

with the regional health offices under

which operated provincial health offices

and city or municipal health offices. The

MOH through the Regional Health Offices

administratively and technically

supervised local health services.

The next major change came in 1986

with EO 119, “Reorganizing the Ministryof Health”, by President Corazon C.

Aquino. It was promulgated under the

Freedom Constitution. EO 119 clustered

agencies and programs under the Office

for Public Health Services, Office for

Hospital and Facilities Services, Office

for Standards and Regulations and Office

for Management Services.

An Executive Committee for National

Field Operations was also established

headed by the Minister with a secretariat

headed by the Deputy Minister serving as

Chief of Staff. The Field Offices were

composed of the Regional Health Offices

and National Health Facilities. The latter

was composed of the National Medical

Centers, the Special Research Centers

and Hospitals. Five Deputy Minister

positions were created and a number of

DOH personnel were relieved.

EO 292 known as the Administrative Code

was promulgated under the new

Constitution. It maintained the

organizational structures under EO 119.

The only difference was that the

ministries were now reverted to

departments as the country returned to

the presidential form of government

from the short-lived parliamentary

system.

In 1988, RA 6675, otherwise known as

the Generics Act was passed to promote,

require and ensure the production of

adequate supply, timely distribution,

rational use and acceptance of drugs and

medicines identified by their generic

name. This Act serves as the legal

framework of the Philippine National

Drug Policy Program.

A major shift

took place in

1991 with the

passage of the

Local

Government

Code also known

as Republic Act

(RA) 7160.

Under this law,

all structures,

personnel and

budgetary allocations from the provincial

health level down to the barangays were

devolved to the local government units

to facilitate health service delivery.

Surprisingly, this did not result in an

immediate restructuring of the affected

departments, including the DOH.

1988 Generics Act – RA 6675

1991 Local Government Code

– RA 7180

1992 MO 27 to improve andstreamline operationsof national agencies

1992

Magna Carta for Public

Health Workers – RA7305

On August 13, 1992, Memorandum Order

(MO) 27 was issued by President Fidel V.

Ramos, which mandated all

instrumentalities and agencies of the

national government to streamline and

improve their operations and

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organizations. The restructuring of the

DOH did not push through in spite of

attempts to reconfigure its vision,

mandate, functions and activities in

keeping with a devolved set-up.

On March 26, 1992, a Magna Carta for

Public Health Workers (RA 7305) was

passed providing for social and economic

benefits for public health workers and

called for a corresponding Code of

Conduct for Public Health Workers.

However, it was not fully implemented

that year due to insufficient funds.

To date, only four types of financial

benefits are being given to governmentworkers, namely: subsistence allowance,

clothing allowance, salary differentials;

and for Rural Health Physicians,

representation and transportation

allowance (RATA). Other devolved health

workers were not paid the benefits

mandated under the Act due to

insufficient funds from local government

units. Given the funding problem, the

implementation of RA 7305, had to

proceed in stages. This situation has

demoralized local health officials and

devolved health workers prompting calls

for a re-nationalization of devolved

health services.

Efforts to promote community-based,

primary health care system were

strengthened through the Barangay

Health Worker’s Benefits and Incentives

Act of 1995 (RA 7883). RA 7883 led to

the registration and accreditation of

some 174,569 Barangay Health Workers

(BHWs) by the city and municipal health

boards in 1997.

The national government appropriated

55 Million as subsidy to the fourth, fifth

and sixth class local government units

(LGUs) to provide for the subsistence

allowance of accredited BHWs. However,

the law has encountered several

implementation problems, including the

following: 1) some BHWs have not been

able to avail of the benefits and

incentives due them after being removed

from the BHW list by local chief

executives (LCEs); 2) some LCE-

accredited BHWs have not undergone the

basic training required under the law;

and 3) the need to sustain the subsidy

from the national government has not

been met.

In the interim, there were other policy

developments that impinged on the

health care system. Laws were passed in

support of the

major policy

thrusts of the

DOH as

stipulated in the

National HealthPlan (1995-2020)

and its

accompanying

document, the

10-year public

investment plan entitled “Investing in

Equity in Health”.

1995

BHW Benefits(RA 7883)

1995

NHI Act(RA7875)

1996

ASIN Law (RA 8172)

The National Health Insurance Act (RA

7875) providing for health insurance

coverage to all Filipinos was passed into

law in 1995. A National Health Insurance

Program (NHIP) was institutionalized

giving emphasis on indigents and is

administered by the Philippine Health

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Insurance Corporation (PhilHealth). Since

then, PhilHealth has instituted a number

of measures relative to increasing

membership, claims processing and

benefit packages.

In the field of nutrition, notable

developments included the formulation

and adoption of the Philippine Plan of

Action for Nutrition (PPAN) and the

implementation of an Act Promoting Salt

Iodization Nationwide, or the ASIN Law

(RA 8172). The ASIN Law and its

implementing Rules and Regulations (IRR)

were disseminated nationwide in 1996

and 1997.

Despite these gains, some issues continueto hamper the effective the effective

implementation of the law, such as low

utilization of iodized salt, lack of supply

of iodized salt in the market, absence of

sanctions for violators, absence of a

monitoring system, high prices and high

standard requirement.

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◘The State of the Nation’s Health

While all these developments over the

years have given rise to opportunities

that led to better health care services

and improved state of health for all

Filipinos - there are still many challenges

that the whole health sector has to

address.

Infant Mortality Rate (IMR) and Maternal

Mortality Rate (MMR) have declined, but

the rate of decline has slowed down

since 1992. Over the past years, there

has been no significant change in thesevital health indices.

The health status of the Philippines is

typical of developing countries in

“transition”. With the rapid demographic

changes today, the country faces threats

from infectious diseases and from the

ever-rising tide of degenerative chronic

conditions. Emerging health problems

brought about by environmental andwork-related risks factors have remained

largely unattended. These are diseases

that are usually found in urban

population brought about by

industrialization and development. Over

all, the country suffers from what is

called the double burden of disease

patterns common in developing

countries.

Improvement in the quality of health

care remains wanting in most areas and

yet the cost of such care has become

exorbitantly high and is beyond the reach

of ordinary people. Added to this is the

prohibitive cost of drugs and medicines.

It has become common for some people

to die without seeing a doctor or without

taking medicines. There are indications

that we are not effectively allocating our

health resources. Likewise, our sourcing

of funds remains inefficient.

The health sector in the Philippines falls

short in meeting these problems due to

several reasons:

Inappropriate health delivery system

such as, poor hospital facilities,

fragmented primary health system,

ineffective delivery mechanism for

public health program, misdistribution

of health human resources and

others.

Inadequate health regulatory

mechanisms such as gaps in

regulatory mandates, lengthy and

laborious regulatory systems andprocesses and inadequate human

resources and facilities resulting in

poor quality of health care, high cost

of privately provided health services,

high cost of drugs and others.

Poor health care financing such as,

inadequate funding, inefficient

sourcing and ineffective allocation.

To be able to transform the health system

into one that would ensure the delivery of

cost effective services, universal access

to essential services and adequate and

efficient financing, major reforms must be

undertaken.

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◘ The National Objectives for Health

Major Health Developments inthe Past Decade

Devolution of health services

Passage of the National HealthInsurance Act

Epidemiological, demographic and

environmental shifts affectinghealth patterns

Pursuing the needed improvement in the

health care system is in line with the

administration’s thrust to prioritize

delivery of services to the masses and

improve the quality of life of all Filipinos,

especially the poor. The differences in

health status among various groups and

regions in the country have widened

through the years. These disparities

indicate deficient economic and social

policies and the need to reprioritize

interventions to promote equity, fairnessand immediate action.

Revitalizing the health care system must

be seen within the broader context of

several forces affecting the delivery of

basic health services in the past two

decades. These factors are: devolution of

health services to local government units,

passage of the National Health Insurance

Law, the epidemiological, demographicand environmental shifts that resulted in

the emergence of new diseases and

reversals of past initiatives or successes in

disease prevention and control.

Under these realities, the health sector

must work to attain a common goal. The

DOH as the lead agency on health sets the

vision for the nation’s health, “Health

for All Filipinos”.

The mission for the entire health sector

is, “To ensure accessibility and quality

of health care to improve the quality of

life of all Filipinos, especially the poor”.

The DOH, in partnership with all agencies

and organization in the health sector aims

to achieve for communities, families and

individuals the following medium term

goals:

General health status of the population

is improved.

Morbidity, mortality, disability and

complications from specific diseases

and disorders are reduced.

Some diseases (e.g., schistosomiasis,

malaria, filariasis, leprosy, rabies,

poliomyelitis, measles and others) are

eliminated or eradicated as public

health problems.

Healthy lifestyle is promoted.

Health and nutrition of families and

special populations are promoted.

Environmental health and sustainable

development are pursued.

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◘The Health Secto r Reform Agenda

HSRA GOALS

Efficient and effective health delivery

system

Well-established and strong healthregulatory system

Sustainable health care financing

mechanisms

To bring the country towards the

attainment of this vision, the DOH,

health professionals, healthorganizations and other stakeholders in

health, put together the Health Sector

Reform Agenda (HSRA). The agenda

outlines the problems and reforms

needed to bring about an efficient and

effective health delivery system, a well

established and strong health regulatory

system and sustainable health care

financing mechanisms. The HSRA

prescribes the adoption of the followingstrategies:

On Health Service Delivery

Promoting fiscal autonomy to

government hospitals

Secure funding for priority public

health programs

Developing and strengthening of local

health systems capacities

On Health Regulation

Strengthening capacities of health

regulatory agencies

On Health Financing

Expanding the coverage and benefit

spending of the National Health

Insurance Program (NHIP)

Reforms in these areas are

interconnected and interrelated. Health

financing reforms through the NHIP will

make hospital fiscal autonomy viable;

hospital reforms in turn will free

resources for investments in public

health and in health regulation at both

the national and local levels; and goodpublic health programs will relieve the

NHIP from the burden of having to pay

for increasing number of curative

services and be able to address those

diseases which are preventable.

To get the reforms going, the DOH has to

take the lead role in providing the

direction of the health sector and in

undertaking several initiatives to

implement the reform strategies. These

are:

Formulation of the investment

packages for health

Formulation of new laws and

issuance of new policy directives

Pursuing organizational changes in

the DOH, PhilHealth and LGUs

Improvement of finance andprocurement management systems

The DOH should pursue the

organizational restructuring it had

already initiated several years ago.

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Part

1

The organizational change in the DOH stems both from the realities within andoutside of the health sector. A movement towards “reinventing” government

has swept bureaucracies all over the world. With greater demand for specific

services and meager resources, government simply cannot provide for all the

needs of its various constituencies.

Governance is no longer an exclusive function of governments but it has to be

distributed rationally to other concerned sectors of society. The paradigm postulates

that what the private sector does better, it should do without undue competition from

government. In addition, non-government organizations should be allowed to

accomplish what they can accomplish on their own or in partnership with government

and other service providers.

Governments must do what only government can do. The Local Government Code of

1991 already laid out the proper role of local governments. The national government

must therefore follow suit. The rethinking of government’s role began with President

Fidel Ramos’ Reengineering the Bureaucracy for Better Governance. This was

reinforced by the guidelines issued by President Joseph Estrada under EO 165, which

directed the formulation of an institutional strengthening program for the Executive

Branch under the Presidential Committee on Effective Governance (PCEG).

There were a number of studies already done on organizational efficiency, as a resultof the devolution of health services. For a number of reasons however, the identified

necessary changes did not materialize.

Between 1992 and 1998, the DOH management undertook three major reorganization

attempts. The first one was during the term of Secretary Juan M. Flavier; the second

began under Secretary Jaime Galvez-Tan and continued under Secretary Hilarion

Ramiro; and the third by Secretary Carmencita N. Reodica. The reorganization under

EO 102 initiated by Secretary Alberto G. Romualdez, Jr. was the fourth major effort at

rationalizing and streamlining the DOH after the devolution of health services to the

local governments.

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◘ Review of Past Studies On DOH

Reorganization

1994 Study - The reorganization studyof 1994 proposed a number of significantchanges. Among these are:

1. Reduction of the number of

undersecretaries from five to

three to take care of the Office

of the Chief of Staff, the Public

Health Group and the Health

Regulation Group; and the

reduction of Assistant Secretaries

from four to two to take care of

Administrative and Technical

Services, respectively.

2. Consolidation of the disease-

specific programs into a Bureau

of Disease Control; the

consolidation of targeted sector

services (such as nutrition,

dental service, family planning

and others) into a Bureau ofPromotive and Preventive

Health, and the setting up of aBureau of Preventive and

Promotive Education.

3. Creation of a Bureau of Hospitals

and Health Facilities, a Bureau of

Research and Laboratories, a

Bureau of Food and Drugs and a

Bureau of Quarantine.

4. Consolidation of the 14

administrative regions into eight

territorial field offices.

It is clear that these changes would have

satisfied some of the requirements of

devolution and the government’s need

for a more streamlined and rationalized

DOH structure. Unfortunately, no

enabling authority was issued, either in

the form of an executive order or a law.

Thus, the proposed reorganizationstructure shown in Figure 1 did not push

through.

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1995 Study - The efforts of Secretary

Jaime Galvez-Tan and Secretary

Hilarion Ramiro differed in the

proposed structure. The Galvez-Tan

organization and management study

focused more on the processes of the

DOH than on its structure.

Among others, it recommended the

adoption of Daily Situationer Briefs,

which will enable the Secretary, Chief

of Staff and other key DOH officers to

quickly address health problems and

opportunities.

Figure 1

Proposed DOH Organizational Structure(1994 Study)

Office of

Public Health

SECRETARY OF HEALTH

BUREAUS

ManagementServices Group

Office of the

Chief of Staff

TechnicalServicesGroup

Health FieldTeams

BUREAUS

Regional

Health Office

RegionalMedical Centers

Hospitals

Office forHealth

Re ulation

It also recommended the fine-tuning of

the existing planning-budget-change

process, the definition of the functions

of the Management Committee,

Executive Committee and the Expanded

Management Committee and the

adoption of a proposed organizational

structure that essentially picks up from

EO 119.

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Following this study, there will be four undersecretaries and an equal number of

assistant secretaries. The undersecretaries will take on the roles of chief of staff,

public health services, hospital and facility services and management services

respectively. Before any of these initiatives could be undertaken, Congressman Hilarion

Ramiro, formerly a public health doctor, was appointed as Secretary of Health. The

corresponding organizational structure for this proposal is shown in Figure 2.

Office of the Chief of StaffUndersecretaryAssistant Secretary

SECRETARY OF HEALTH

Support Services

Office of PublicHealth ServiceUndersecretary

Asst. Secretary

Office for Hospitaland Facility ServicesUndersecretary Asst. Secretary

Programs/

Service Programs/

Service

Hospitals/Medical

Centers

Office for ManagementServicesUndersecretary Asst. Secretary

Programs/

Service

RDs

Figure 2

Proposed DOH Organizational Structure(1995 Study)

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The Ramiro organizational analysis

proposed a continuance of the existing

structure with the addition of sub-

committees headed by assistant

secretaries to handle LGUs and Health

Systems, resource generation and

mobilization and health information and

monitoring. There seemed to have been

a consensus at that time that in the

absence of an enabling law from

Congress, no restructuring or

reengineering could be legally

undertaken.

What appeared to be a major insight of

the Ramiro study is the fact that DOH

programs and activities suffer from afunnel effect. There are 2000 staff

coordinating 62 programs at the national

level; 80 to 100 staff coordinating the

same program at the regional level; 30

personnel implementing programs at the

provincial level; and 10 staff actually

executing these programs at the

municipal level. Clearly, these defy

administrative logic and the very

principles of devolution. Clearly too,these also presented opportunities for

restructuring.

1997 Study. The 1997 study

conducted under Secretary Carmencita

Reodica recognized that there were

unmet health care needs due to

underprovision on the supply side and

underutilization on the demand side. It

also specified that the attainment of

quality health care and high standard of

staffing, facilities and working

relationships would be a major goal of a

reengineered DOH. This study identified

the following as areas for improvement

within DOH:

1. Weak health policy process

2. No strategic planning

3. Poor health program management

4. Inefficient and fragmented

enabling processes and systems

5. Inadequate health advocacy

6. Lack of efficient and effective

health and management

information system

7. Lack of accountability of

management systems

8. Reliance on old work habits

9. Weak networking with health

partners and stakeholders

10. Lack of reward and incentive

systems

11. Structural flaws

12. Too much bureaucratic red tape

The following are the salient features of

the 1997 DOH reengineering proposal:

1. Streamline the DOH topmanagement from four

undersecretaries to one

undersecretary.

2. Develop a scientist and specialist

track for technical personnel.

3. Create non-permanent Cluster on

Health Policy and Program

Innovation.

4. Shift from disease-specific toprocess management teams.

5. Establish two separate offices for

licensing and regulation.

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6. Create advisory boards to the

Office of the Secretary.

7. Create a single office for support

services.

8. Privatize production plants.

9. Strengthen DOH liaisoning

capability.

10. Place retained hospitals under an

Office for Hospital Development.

The proposed DOH organizational

structure under the Reodica

proposal is shown in Figure 3.

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Office forHealth

Services

Regulation

OFFICE OF THE

SECRETARY

Office of theUndersecretary Advisory

Boards

Media

Unit

AttachedAgencies

Office forPharmaceuticalsand Radiation

Safety

Office forPublicHealth

Program

Development

Office forPolicy andProgram Support

Office forHospitalDevelop-

mentand

Management

FieldHealth

Units

Cluster for Health Policy and P

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Part

2

Executive Order 102 issued in May 1999 “Redirecting the Functions and

Operations of the Department of Health” gave it the mandate to institute the

necessary organizational changes. The issuance and implementation of EO 102 is

based on Sections 77 (Organizational Changes), 78 (Implementation of

Reorganization) and Section 79 (Scaling Down and Phasing Out of Activities of Agencies

within the Executive Branch) of the General Provisions of the General Appropriations

Act (GAA) for 1999. The same provisions were also included in the GAAs of 1995 to

1998, which is in keeping with Section 42, Chapter 5 and Book VI of the Administrative

Code of 1987.

EO 102 mandates the DOH to provide assistance to LGUs, people’s organizations (PO)

and other members of civil society in effectively implementing programs, projects and

services that:

1. Promote the health and well being of every Filipino.

2. Prevent and control diseases among populations at risks.

3. Protect individuals, families and communities exposed to health hazards and

risks.

4. Treat, manage and rehabilitate individuals affected by disease and disability.

Among others, EO 102 stipulates the preparation of a Rationalization and Streamlining

Plan (RSP) for the DOH.

Phase1 of the RSP shall contain all the proposed structures, functions and staffing

pattern of the different offices in the Central Office (CO), including the Bureau of Food

and Drugs (BFAD) and the National Quarantine Office (NQO). Phase 2 shall deal with

streamlining the functions and staffing pattern of the regional offices and retained

hospitals, while Phase 3 shall deal with the DOH attached agencies.

EO 102 is complemented by a later issuance affecting the health care service deliverysystem. EO 205 dated January 31, 2000 provides for the creation of a National Health

Planning Committee (NHPC) and the establishment of Inter-Local Health Zones (ILHZs)

throughout the Philippines. In tandem with EO 102, EO 205 is expected to accelerate

service delivery under a decentralized mode.

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◘Guiding Principles and Parameters

In the formulation of the RSP, the DOH considered the governance framework

formulated by the Presidential Committee on Streamlining the Bureaucracy (PCSB)

under the DBM in August 1995 and reinforced by the PCEG in October 1999. The guidingprinciples of this framework were:

Principle of Frugality and

Prioritization - The scope ofgovernment shall be within available

resources and its activities accordingly

prioritized. Government should have a

conscious and deliberate effort to define

what it will do, must do, can do

and wants to do given the call of the

times, its legal mandate, resources and

constraints. All these shall be defined in

the government’s plans and policy

pronouncements.

Principle of Steering - The role ofthe national government in the sectors

shall be to steer rather than row the

boat. The focus of its sectoral functions

therefore shall be on the following:

1. Policy setting, monitoring and

assessment.

2. Promotion and advocacy.

3. Provision of information and

linkages or access to markets,

services and production inputs and

outputs.

4. Provision of assistance and

incentives that will equalize and

level the playing field.

5. Enforcement of appropriate rules

and regulations.

6. Ensuring the provision of safety

nets for adversely affected

population

This principle also laid down therelationship of the government to the

private sector. It is government’s role to:

1. Promote a stable policy

environment; set minimum and

appropriate rules; provide

information and give support to the

production of goods rather be

directly engaged in it.

2. Encourage sharing of resources and

responsibility.

3. Assume primary responsibility in

the production of public goods and

services.

Principle of Vertical

Compartmentalization –Government should reduce duplication of

effort and maximize the use of allresources to achieve socioeconomic and

political goals. Sectoral activities shall

be properly compartmentalized and

accordingly appropriated between the

government and the private sector.

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Government activities shall be properly

distributed among levels of government

- central government, government

corporations and local government units.

Principle of Devolution - Thenational government and local

government units shall be partners in the

pursuit of the development process. The

proper role of the national government

is to set national policy and standards;

and assist, oversee and, monitor local

government units complementary to the

stronger implementing role that local

governments shall assume.

Parameters - The organizational change in the DOH took into consideration

the following basic policy framework.

1. Leaner and Better Central Office

(CO). Enhancing the central office

function particularly on policy

formulation and on establishingtechnical leadership in health.

2. Stronger and More Responsive

Field Offices and Facilities.

Strengthening of field offices

including hospitals and attached

agencies to support direct service

provision and technical leadership

in health.

3. Technical Leadership Over Health

Programs and Increased Technical

Assistance to Local Health

Systems. Strengthening of DOH’s

advocacy role; emphasizing the

need for stronger external

networking and linkaging.

4. Integration of Public Health

Concepts in the Hospital System.

Ensuring that preventive and

promotive health concepts are alsooperational in hospitals.

5. Stronger Regulatory Systems for

Quality Assurance in Health.

Ensuring enforcement of health

standards by reinforcing standard-

setting activities, focusing on

quality assurance and deploying

more enforcement officers in the

field.

6. Stronger National Health

Insurance System. Strengthening

the national health insurance

system to ensure more access to

health by the less privileged,

especially the indigents.

Guidelines - In addition, the reengineering efforts of DOH were guided by the

following specific guidelines and rules:

1. No person will be laid-off or

demoted in keeping with existing

Civil Service Commission (CSC)

rules on reorganization. The worst

scenario is deployment to the

various hospitals or field officeswhere a person’s security of tenure

is assured unless he or she chooses

to resign, retire or seek voluntary

separation. A six-month period was

provided during which time

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employees may choose which

offices they wish to be deployed

to.

2. CO will attempt to diminish the

number of its personnel by half in

keeping with the realignment of

functions envisioned in the RSP.

3. The grouping of functions will

reflect the DOH’s major reform

areas for the next ten years.

4. The reengineered DOH will have a

personnel budget that does not

exceed its present Personal Service

allocation.

5. A system of incentives will be

developed for relocating personnel

including relocation allowances,

assurance of security of tenure and

equal consideration for career

movement within the DOH,

whether at CO, the field offices,

the hospitals and the attached

agencies.

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◘ Procedures and Processes

At the start of the reorganization

process, the DOH Oversight Committee

on Reengineering directed all heads of

offices to undertake a review of their

existing functions. They were also

advised to propose the corresponding

changes in staffing complement

according to new defined functions and

according to the foundational principles

from the Civil Service Commission (CSC)

and the DBM.

The various offices, bureaus and servicessubmitted draft proposals that were

further deliberated and reviewed both by

the concerned offices and the

Reengineering Secretariat before these

were endorsed to the DOH Oversight

Committee for approval. After the DOH

Oversight Committee has approved the

RSP, this was presented to the DBM,

which reviewed the plan and

recommended some revisions. The DBM

Secretary approved the RSP with the

issuance of the Notice of Organizational

Staffing and Compensation Action

(NOSCA). The plan was then forwarded

to the PCEG, which was headed by the

Executive Secretary. The PCEG through

Memorandum Circular (MC) No. 62 finally

approved the implementation of the RSPon July 17, 2000.

The DOH reorganization proceeded from

the prescribed procedures and steps

shown in Table 1.

TABLE 1 – PROCEDURES AND PROCESSES FOR RATIONALIZATION AND STREAMLINING

ACTIVITY REFERENCE DOCUMENTS OUTPUT

1. Mandate Review 1. EO 102; Health SectorReform Agenda; Pertinentlegislation; and otheradministrative issuances

1.Hierarchy of Functions(Indicate if function isprimary, secondary ortertiary, or if shift in functionis contemplated)

Guide Questions:

a. What will we do now thatwe were not doing before?What activities should westop doing?

b. What cluster of activities

should I belong to:regulation, program, policy,management support andothers

c. Who or which offices shouldbe in which cluster?

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ACTIVITY REFERENCE DOCUMENTS OUTPUT

2. Drawing Up the OrganizationalStructure

2. Output No.1 2. Table of Organization

Guide Questions:

a. What kind of organization do we needto fulfill our functions (bureau, service,unit)?

b. What level or rank should our highestofficial be?

c. What units should we have and whatkind of function should these unitsexercise?

3. Staffing Review 3. Output No. 2 3. Staffing pattern ofunit

Guide Questions:

a. How many people do we need toimplement the functions?

b. What kinds of skills, titles and otherqualifications should they carry?

4. Cost Review 4. Output No. 3; and present costallocation per unit

4. Total personnel costs

Guide Questions:

a. How much will it cost in terms ofhuman resource to pursue thefunctions we will now exercise?

b. Will this represent an increase ordecrease in present costs?

5. Integration of outputs across the DOH 5. Outputs No. 1 to 4 5. Rationalization andStreamlining Plan (RSP)

Guide Questions:

a. Will this RSP meet the intentions ofstrengthening the Region as a technicaland resource center for LGUs?

b.Will this result in eliminatingfunctional/ supervisory overlaps at CO?

c.Will this meet the DOH’s HSRA?

d. What kind of retraining and retoolingwill this require of the DOH personnel?

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As the aforementioned processes were

undertaken, supplemental activities

were on going:

1. Review of pertinent laws such asEO 851 (Reorganizing the Ministry

of Health, 1982), EO 119

(Reorganizing the Ministry of

Health, 1987), EO 292 (Instituting

the Administrative Code, 1987),

EO 102 (Redirecting the Functions

and Operations of the

Department of Health), and the

Magna Carta for Public Health

Workers and other relevant DOHdocuments.

2. Interviews with selected officials

and personnel from DOH CO, field

offices and attached agencies.

3. Interviews with significant DOH

constituencies: Congressmen,

Senators, LGUs and NGOs.

4. Conduct of group meetings with

DOH management.

5. Conduct of orientation workshops

participated by personnel from

all ranks.

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DD OO HH RR aa tt ii oo nn aa ll ii zz aa tt ii oo nn Part3 AA nn dd SS tt rr ee aa mm ll ii nn ii nn g g PP ll aa nn

The DOH Rationalization and Streamlining Plan (RSP) for Phase 1 focusing on

Central Office reorganization was formulated. This was approved by the DBM

through its issuance of the NOSCA with the approved staffing complement and

positions in all offices of the reengineered DOH. The NOSCA was posted in all

offices for guidance and information of all DOH officials and personnel and the

Placement and Selection Committees. The issuance of Memorandum Circular (MC) No.

62, through the PCEG sets into motion the DOH reengineering process.

Memorandum Circular 62 among other things highlighted that the rationalization and

streamlining process in the DOH was in keeping with the health sector reform program.It also called for a more in-depth organizational restructuring at all levels and offices

of the DOH, such that the Centers for Health Development (CHD), retained hospitals

and other attached agencies of the DOH shall follow suit.

Components of the RSP - The RSP shall detail the following shifts:

1. The shifts in policy directions, functions, programs, strategies and activities.

2. The structural and organizational shift, stating the specific functions and

activities by organizational units; and the relationship of each unit.

3. The staffing shift, highlighting and itemizing the existing filled and unfilled

positions.

4. The resource allocation shift, specifying the effects of the streamlined set-up on

the agency budgetary allocation and possible savings.

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◘ Policy and Functional Shifts

The shift in policy directions, functions, programs, strategies and activities of the DOH

are summarized below in Table 2.

TABLE 2 – POLICY AND FUNCTIONAL SHIFTS

Area From To

Policy Direction Planner, formulator andimplementer of public healthpolicies, programs and standards

National technical authority onhealth; providing technical andother resource assistance toconcerned groups

Function Direct provision of service Policy formulation, advocacy,program development,standard setting, regulationand monitoring

ImplementingStrategy

Establishment, operation andmaintenance of health units downto the barangay level

Technical and financialassistance to DOHintermediaries through thefield offices

Approach Individual Health Sector

Constituency Individuals DOH partners, intermediaries,LGUs, NGOs, POs, privatesector

DOH Roles - These shifts are

amplified in the following roles of

the DOH as prescribed in EO 102:

1. Lead agency in articulating national

objectives for health to guide the

development of local health systems,

programs and services.

3. Lead agency in health emergency

preparedness and response

services, including referral and

networking systems for trauma,

injuries and catastrophic events.

4. Technical authority in disease

control and prevention.

2. Direct service provider for specific

programs that affect large segments

of the population, such astuberculosis, malaria,

schistosomiasis, HIV-AIDS and other

emerging infections and

micronutrients deficiencies.

5. Lead agency in ensuring equity,

access and quality of health care

services through policy formulation,standards development and

regulations.

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13. Protector of standards of excellence

in the training and education of

health care providers at all levels of

the health care system.

14. Implementer of the National HealthInsurance Law, providing

administrative and technical

leadership in health care financing.

6. Technical oversight agency in charge

of monitoring and evaluating the

implementation of health programs,

projects, research, training and

services.

7. Administrator of selected health

facilities at sub-national levels that

act as referral centers for local

health system (i.e., tertiary and

special hospitals, reference

laboratories, training centers, center

for health promotion; centers for

disease prevention and control,

regulatory offices among others).

8. Innovator of new strategies for

responding to emerging health needs.

9. Advocate for health promotion and

healthy lifestyles for the general

population.

10. Capacity-builder of LGUs, the private

sector, NGOs, people’s organizations,

national government agencies in

implementing health programs andservices through technical

collaborations, logistical support,

provision of grants and allocation and

other partnership mechanism.

11. Lead agency in health and medical

research.

12. Facilitator of the development of

health industrial complex in

partnership with the private sector to

ensure self-sufficiency in the

production of biologicals, vaccines

drugs and medicines.

DOH Functions - Given these

roles, the DOH has the following

functions under EO 102:

1. Formulate national policies and

standards for health.

2. Prevent and control leading causes

of death and disability.

3. Develop disease surveillance and

health information systems.

4. Maintain national health facilities

and hospitals with modern and

advanced capabilities to support

local services.

5. Promote health and well being

through public information; and to

provide the public with timely and

relevant information on health risks

and hazards.

6. Develop and implement strategies

to achieve appropriate

expenditures patterns in health asrecommended by international

agencies.

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7. Develop sub-national centers and

facilities for health promotion,

disease prevention and control,

standards and regulations and

technical assistance.

8. Promote and maintain international

linkages for technical collaboration.

9. Create the environment for

development of a health industrial

complex.

11. Ensure quality of training and

health human resource

development at all levels of the

health care system.

12. Oversee financing of the health

sector and ensure equity and

accessibility to health services.

13. Articulate the national health

research agenda and ensure the

provision of sufficient resource and

logistics to attain excellence in

evidenced-based interventions for

health.

10. Assume leadership in health in

times of emergencies, calamities,

disasters and systems failures.

All these indicate a de-emphasis on direct

service provision and program

implementation in keeping with

devolution, to an emphasis on policy-

formulation, standard setting and quality

assurance and shift to technical

leadership and resource assistance.

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◘ Structural and Organizational Shifts

With the shift in policy directions,

functions and programs, the structure

and organizational composition of the

DOH were likewise modified. The

principles that guided this shift are:

1. Enhance the CO function

particularly on policy formulation

and on establishing technical

leadership in health.

2. Strengthen the DOH’s advocacy

role, emphasizing the need forstronger external networking and

developing linkages.

3. Strengthen the field offices

including hospitals and attached

agencies to support direct service

provision and technical leadership

in health.

4. Ensure enforcement of health

standards by reinforcing standard-

setting activities, focusing on

quality assurance and deploying

more enforcement officers to the

field.

5. Strengthen the national health

insurance system to ensure more

access to health by the less

privileged.

The structural framework for

organizational reforms and reengineering

efforts undertaken by the DOH under EO

102 is shown in Figure 4.

The organizational structure

encompasses the various DOH units as

well as its attached agencies. The

attached agencies are the Philippine

Health Insurance Corporation (PHIC),

which used to be the Philippine Medical

Care Commission; the Dangerous Drugs

Board ; the two new agencies created by

specific laws - the Philippine Institute

for Traditional and Alternative Health

Care (PITAHC) through RA 8423 and the

Philippine National AIDS Council (PNAC)through RA 8504; and the corporate

hospitals (Philippine Heart Center, Lung

Center of the Philippines, National

Kidney and Transplant Institute and the

Philippine Children’s Medical Center),

collectively called the National Centers

for Specialized Health Care.

There are three major office clusters

under the Office of the Secretary in thenew DOH structure. These are:

Health Regulation Cluster, which

shall initiate standard-setting and policy

formulation for the licensing, regulation

and monitoring of health facilities and

services, food and drugs and health

devices and health-related technology.

Regulation officers in the Centers for

Health Development will enforce these

standards.

External Affairs Cluster, which shall

be responsible for the formulation of

policies and standards pertaining to

international health surveillance,

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linkages of the DOH with the

international community as well as local

government units, non-government

organizations and the private sector.

Health Program Development

Cluster, which shall be the technical

authority for public health surveillance,

disease prevention and control, health

promotion and health facility

development.

These three major office clusters are

composed of bureaus and centers.

Two staff bureaus directly report and

provide support to the Secretary of

Health, the Health Human Resource

Development Bureau and the Health

Policy Development and Planning

Bureau. While these bureaus serve the

internal requirements of the DOH as an

organization, the extent of their work

includes the wider health sector as

policies, plans and human resource

development programs are promulgated

with and for sector-wide constituents

and therefore cannot be limited to

organic DOH staff. To complement these,

a staff unit, the Health Emergency

Management Staff also reporting directly

to the Secretary of Health, was

organized to provide sector-wide

coordination and development on health

emergency preparedness and response.

Internal management support services

are provided by four services namely:

Administrative Service, Information

Management Service, Finance Service

and Procurement and Logistics Service.

The Secretary of Health exercises overall

direction and control over the operations

of the Centers for Health Development

(CHDs). These

CHDs oversee

the

implementati

on of policies

and programs

at the

regional level

and in the

retained

health

facilities within the region.

Four CHD Divisions

ManagementSupport Division

Health OperationsDivision

Health RegulationDivision

There are four divisions under the CHDs,

similar to the number of divisions of the

former Regional Health Offices but with

shift in functions. The Administrative and

Finance Divisions were merged into the

Management Support Division. The

Technical and Training Divisions were

merged into Health Operations Division.However, two new divisions were

created: Health Regulation Division

which will handle enforcement of

regulatory policies and Local Health

Assistance Division which will directly

relate to LGUs, NGOs, POs and the

private sector in the development of

local health systems, extension of

technical and other kinds of assistance in

the field of health.

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Table 3 lists the number of major offices and units within the DOH and its attached

agencies. Overall, there is a net decrease of 30 units.

TABLE 3 – COMPARISON OF ORGANIZATIONAL UNITSIN THE DOH UNDER EO 119 AND EO 102

Organizational

Unit

Existing under

EO 119

(1987)

Created under

EO 102

(1999)

Increase

(Decrease)

1. Executive Offices

1.1 Office of the Secretary 1 1 0

1.2 Office of the Undersecretary 5 3 (2)

1.3 Office of the Asst. Secretary 4 4 0

2. Central Office

2.1 Offices headed by Director IV(Bureaus and National Centers)

4 12 8

2.2 Offices headed by Director III(Services and Staff Offices)

25 5 (20)

2.3 Divisions headed by Positionsat SG 25

37 29 (8)

2.4 Divisions headed by Positionsat SG 24

34 26 (8)

3. Centers for Health Development*

3.1 Office of the Director 15 15 0

3.2 Divisions headed by Positions at SG25

30 30 0

3.3 Divisions headed by Positions at SG24

30 30 0

4. Hospitals *

4.1 Special Hospitals 12 12 0

4.2 Regional Hospitals and MedicalCenters

31 31 0

4.3.Provincial Hospitals 4 4 0

4.4 District Hospitals 5 5 0

4.5.Municipal Hospitals 2 2 0

4.6 Sanitaria 8 8 0

4.7.Research Hospitals 2 2 0

5. Attached Agencies**

5.1 Corporations/Council/Board 2 4 2

5.2 Specialty Hospitals 4 4 0Net Increase / (Decrease) (30)

* For further organizational review under Phase 2 of the reengineering process.** For further organizational review under Phase 3 of the reengineering process.

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Offices of the Undersecretary were

reduced from five to three. One office

for Undersecretary (which is vacant) was

abolished while another office will be

abolished after the Undersecretary

position, which is considered a co-

terminus position, is vacated.

While there is an increase of eight

bureaus headed by Director IV,

significant reductions are realized in the

number of staff services headed by

Director III and divisions headed by

Division Chief occupying positions with

salary grade 25 and salary grade 24.

Table 4 details the 12 newly createdbureau level offices including the

national centers. It will be noted that

three regulatory bureaus are retained,

the functions of the former Bureau of

Research and Laboratories are now

integrated into the National Center for

Health Facility Development, for non-

regulatory functions and the Bureau of

Health Facilities and Services (formerly

the Bureau of Licensing and Regulation)

for regulatory functions. A Bureau of

Health Devices and Technology has been

created with the former Radiation Health

Service as the core with an expanded

function to regulate and determine the

health hazards posed by a myriad of new

health and health-related technology and

devices that have entered the market.

TABLE 4 – BUREAU LEVEL OFFICES

Offices Headed by Director IVCentral Office

Existing Under EO 119 Created Under EO 102

1. Bureau of Licensing andRegulation

2. Bureau of Food and Drugs3. Bureau of Research and

Laboratories

4. National Quarantine Office

1. Bureau of Health Facilities and Services

2. Bureau of Food and Drugs

3. Bureau of Health Devices and Technology

4. Bureau of Quarantine and International HealthSurveillance

5. Bureau of International Health Cooperation

6. Bureau of Local Health Development

7. National Epidemiology Center

8. National Center for Disease Prevention andControl

9. National Center for Health Promotion

10. National Center for Health Facility Development

11. Health Policy Development and Planning Bureau

12. Health Human Resource Development Bureau

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The following Table 5 identifies the five new services headed by a Director III. All the

previous 25 services and staff offices are deemed abolished or integrated into the

newly created bureaus, national centers and services.

TABLE 5 – SERVICE LEVEL OFFICES

Offices Headed by Director III - Central Office

Existing Under EO 119 Created Under EO 102

1. Maternal and Child Health Service 1. Administrative Service

2. Tuberculosis Control Service 2. Information Management Service

3. Family Planning Service 3. Finance Service

4. Environmental Health Service 4. Procurement and Logistics Service

5. Nutrition Service 5. Health Emergency Management Staff

6. Dental Health Service

7. Malaria Control Service

8. Schistosomiasis Control Service

9. Communicable Disease Control Service

10. Non-communicable Disease ControlService

11. Hospital Operations and ManagementService

12. Radiation Health Service

13. Hospital Maintenance Service

14. Health Infrastructure Service

15. Community Health Service

16. Public Information and Health EducationService

17. Health Intelligence Service

18. Internal Planning Service

19. Foreign Assistance Coordination Service

20. Administrative Service

21. Finance Service

22. Management Advisory Service

23. Health Manpower Development andTraining Service

24. Procurement and Logistics Service

25. Biologicals Production Service

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◘ Staff ing Shift

The changes in the structure and the

organizational composition of the DOH

necessitate corresponding changes in

staffing.

Guiding Principles - The

determination of staffing requirements,

position allocation and classification

under the proposed set-up considered

the following factors:

1. Adopt standard staffing pattern as

much as possible for similar units

or posts.

2. Emphasize technical over non-

technical positions consistent with

the redirected functions of the

DOH.

3. Expand the number of positions

charged with substantive functions

and compress positions performing

activities that may be purchasedfrom the private sector.

4. Adopt generic nomenclatures for

positions to accommodate more

professions and disciplines in the

roster of personnel.

Staffing Scheme - The

preparation of the staffing pattern

involved careful deliberations and

selection of the appropriate number and

competencies of the positions proposed.

The proposal assumed a phased

implementation scheme as follows:

1. Stage 1 proposed staffing pattern

includes co-terminus (CT) positions

(i.e., CT/co-terminus with

incumbent (CTI) positions). This

will be the operational staffing

pattern in the course of RSP

implementation.

2. Stage 2 proposed staffing pattern

excludes co-terminus positions

(i.e., without CT/CTI). This will be

the staffing pattern upon full

implementation of the RSP.

In effect, Stage 1 shall serve, as the

interim or transition stage while Stage 2

will be the final stage when RSP is fully

implemented.

For Stage 1, proposed positions were

matched with existing positions with the

same or higher salary grades. This

resulted in the transitory provision of co-

terminus positions in the interim stage.

Also, this meant that the implementation

of the ideal or full staffing pattern (i.e.,

with proposed needed positions) would

be deferred until such time that certain

posts are vacated and resources

generated to fund the desired staffing

changes.

This scheme was resorted to in order to

reconcile two conflicting objectives: (1)limiting funding to existing personnel

services appropriations and (2) providing

a long-term view of the staffing

requirements of a reengineered DOH.

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Moreover, the two-stage implementation

takes into consideration that this

reengineering may have uncovered

redundancies which, for humanitarian

reason will simply be the subject of

deployment with abolition to take place

upon retirement, transfer or promotion,

or resignation of the incumbent,

whichever comes first.

It will also be noted that while around

half of central office staff would be

deployed, these numbers in fact went to

field offices as well as hospitals, which

suffer from chronic personnel shortage.

Also, bureaus and attached corporations

that have been given additionalmandates of new laws were recipients of

deployed positions, mitigating in the

meantime, the creation of new positions.

To minimize staffing problems, the DOH

has chosen to implement its RSP using a

number of interventions. At the onset, it

asked its employees to register for

voluntary deployment to any of its

regions, hospitals or attached agencies

that have sought Department of Budget

and Management (DBM) approval for the

creation of new positions.

In the meantime, it met with central

office staff and other constituencies to

configure the ideal CO structure. Those

who did not volunteer for deployment to

any agency of their choice would

eventually be subject to mandatory

deployment to offices that are in need of

personnel. In any case, there would be

no instance of any demotion in rank,

salary or emoluments subject to existing

CSC guidelines and standards.

Staffing Modification - Some

proposals called for a reclassification of

existing position titles to conform to the

new functions of the DOH. Some

positions were also identified as co-terminus with the incumbents and will

either be abolished or downgraded to its

appropriate rank when the incumbents

retire, resign, transfer or get promotion.

Standard Staffing Pattern - Standard staffing patterns were adopted

for the offices of the Undersecretary,

Assistant Secretary, Bureau Director or

equivalent and Service Director or

equivalent. A standard staff complement

adapted for specific offices are as

follows:

Office of the Undersecretary

1. Undersecretary

2. Executive Assistant IV

3. Administrative Officer II

4. Private Secretary II

5. Computer Operator IV

6. Clerk III

7. Chauffeur I

8. Utility Worker I

Office of the Assistant Secretary

1. Assistant Secretary

2. Executive Assistant III

3. Computer Operator III

4. Private Secretary I

5. Clerk II

6. Driver II

7. Utility Worker I

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The staff complement for the Offices of the Director IV and the Offices of the Director

III at the central office were also standardized as follows:

Office of the Bureau Director

1. Director IV

2. Administrative Officer II

3. Computer Operator II

4. Driver II

Office of the Service Director

1. Director III

2. Administrative Officer I

3. Computer Operator II

4. Driver I

Salary Grade Structure - The

staffing pattern improved the quality of

positions in the DOH towards higherand more substantive posts compared

to administrative/routinary posts in

keeping with the leadership role of

DOH in the health sector. Table 6

shows that there is more technical staffcompared to administrative staff.

TABLE 6 – SUMMARY OF POSITIONS BY OFFICE AND CLASSIFICATION

TECHNICAL STAFF VS. ADMINISTRATIVE SAFF

POSITION CLASSIFICATION TOTALOFFICE

Technical Staff

(SG 11 & Above)

Administrative Staff

(SG 10 & Below)

TOTAL 850 449 1299

Office of the Secretary 78 42 120

OSEC Proper 25 13 38

Office of the Undersecretaries 18 12 30

Office of the Asst. Secretaries 16 12 28

Health Emergency Management Staff 13 3 16

Phil. National AIDS Council 6 2 8

Health Regulation Cluster 355 184 539

Bureau of Health Facilities & Services 56 20 76

Bureau of Food and Drugs 249 147 396

Bureau of Health Devices & Technology 50 17 67

External Affairs Cluster 91 100 191

Bureau of Quarantine & Int’l Health

Surveillance

45 93 138

Bureau of Int’l Health Cooperation 25 3 28

Bureau of Local Health Development 21 4 25

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POSITION CLASSIFICATION TOTALOFFICE

Technical Staff

(SG 11 & Above)

Administrative Staff

(SG 10 & Below)

Health Program Development Cluster 179 41 220

National Epidemiology Center 30 8 38

National Center for Disease Prevention

& Control

73 11 84

National Center for Health Promotion 31 17 48

National Center for Health Facility

Development

45 5 50

Sectoral Support Cluster 53 18 71

Health Human Resource Development

Bureau

23 9 32

Health Policy Development and

Planning Bureau

30 9 39

Management Support Cluster 94 64 158

Administrative Service 20 19 39

Information Management Service 38 11 49

Finance Service 22 13 35

Procurement and Logistics Service 14 21 35

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◘ Resource Allocation Shift

The changes in the structure and staffing

pattern of the DOH effected

corresponding changes in resourceallocation particularly for Personal

Services (PS). Guided by the principle

that the reengineered DOH shall have a

personnel budget that does not exceed

the existing PS allocation, the estimated

PS cost (which only covers basic salary)under the EO 119 and the EO 102

organizational structures are compared

in Table 7.

TABLE 7 – COMPARISON OF PS REQUIREMENTS OF STAFFING PATTERN

UNDER EO 119 AND EO 102 DOH ORGANIZATIONAL STRUCTURE

EO 119 EO 102(Transition stage) *

EO 102(Final stage)**

Offices Required No. of Staff Required No. of Staff RequiredNo. ofStaff

PS under EO102(a)

PS under EO102(a)

PS

Office of the Secretary 309 44,945,376 38 4,013,002 37 3,874,185

Executive Offices 99 13,640,652 58 7,763,256 52 6,849,791

Sectoral Support Cluster 82 9,023,868 87 9,720,648 88 9,809,317

Management SupportCluster

637 66,605,599 159 19,119,021 158 19,030,352

Health Regulation Cluster 509 64,526,800 539 44,644,198 539 44,644,198

External Affairs Cluster 350 32,879,640 191 19,012,176 191 19,012,176

Health ProgramDevelopment Cluster

964 128,926,320 220 23,789,024 218 23,494,058

TOTAL 2,950 360,548,255 1,292 128,061,325 1,283 126,557,928

* Stage I – staffing pattern includes positions, which are co-terminus with incumbent holderof positions (CTI)

** Stage II – staffing pattern upon full implementation of RSP Stage 1, which excludes CTIpositions

(a) Excludes staff of Philippine National AIDS Council

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As shown in Table 7, the PS requirement of the staffing complement of the DOH central

office under EO 119 amounts to P360.5M. Under the transition phase of Stage 1, PS

requirement amounts to P128M. This reduces PS allocation by about 64 percent. In the

final phase of Stage 1, when all the CTI positions have been vacated, an additional

savings amounting to P1, 5M shall be generated.

Phase 1 of the reengineering process immediately generated an estimated savings of

about P56, 754,132. This is broken down as follows:

Direct savings from abolition of vacancies - P15, 000,000

Indirect savings from the deployment of

positions to units created by

special laws

Renationalized hospitals P15, 908,562

PITAHC 17, 514,390

PNAC 1, 233,648

BFAD Satellite Labs

CHD VII 3, 617,356

CHD XI 3, 480,176

TOTAL P56, 754,132

As a result of the proposed staffing changes, there is also a corresponding change in the

budget format and in the program/project/activity (P/P/A) language in the General

Appropriations Act. This simplifies account/item entries in the GAA in consonance with

the HSR objectives.

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M A N A G I N G T H ER E F O R M P R O C E S S

Chapter

2

◘ Management of Change and Expectations

Managing change at the DOH is a daunting proposition. While any kind of

change is expected to meet some measure of resistance, the situation at the

DOH was aggravated by a number of factors.

The first one had to do with RA 7160 or the Local Government Code (LGC).

Implemented in 1992 after its passage in 1991. RA 7160 succeeded in shifting almost

46,000 DOH personnel to LGUs all over the country. This left a still substantial number

of over 27,262 personnel under the DOH national payroll as of December 31, 1999. This

was an awkward situation considering that direct service delivery, which is supposed to

be the more people-intensive part of the DOH functions had already been devolved.

The DOH pre-devolution structure remained untouched, perpetuating practices and

procedures that should have changed with the downloading of the DOH’s service

delivery function. Since form usually defines function, the unchanged DOH structure

continued to operate on old premises. The remaining employees have been led tobelieve that the status quo would remain and that, for the most part, their respective

assignments and responsibilities would not change significantly. This mindset resulted

from failed attempts to restructure the DOH after the enactment of the LGC.

The second factor had to do with the enactment of the Magna Carta for Public Health

Workers or RA 7305. Among others, this law mandates that health workers cannot be

transferred to another station or place of work without their consent. This further

solidified the perception that reorganization would no longer take place, even if the

bureaucracy at the national level remained at levels that were difficult to justify.

The previous experience of devolved employees constitute another source of resistance

by the remaining employees to any form of movement, even if this is merely de-

concentration or movement within the same organization.

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There are more than enough stories of

health workers who, under devolution,

were designated to do jobs other than

what they were trained for; who were

demoted in pay or rank even if this was

explicitly prohibited by existing laws;

who experienced difficulties in the

payment of retirement benefits and who

had to work with local officials whose

priorities did not include health care in

the volume and value attributed to the

earlier national health service delivery

system. Those who thought themselves

lucky to have stayed with the national

government swore that they would not

allow themselves to be caught in a

similar situation in the future.

The growing militancy of government

workers has not spared the DOH. Some of

its employees are allied with the more

militant labor federation and are not

beyond using their network to lobby and

advocate for the maintenance of existing

rights or to protest perceived diminution

of benefits. They are joined by a group

of middle managers and seniorexecutives whose positions may be

deactivated with the shift to a function-

focused CO as opposed to the existing

disease-specific and sector-based

structure.

What was also being questioned is the

authority of the President to effect a

reorganization of specific executive

departments in the absence of any

legislation from Congress. It is held by

some that the authority to reorganize is

an inherent function of Congress and may

not be exercised by any other. Thus, a

reorganization covered by an executive

order may not be carried out without the

risk of being declared void by the proper

courts.

Any change management plan must

address these factors if it is to achieve

some measure of success. It must be

pointed out that while there may be

hindering factors to the change process

that accompanies a reorganization or

reengineering effort at the DOH, there

are also assisting factors that could be

put to work. For instance, the senior

management levels of the DOH are all

“old hands”, so to speak.

Three of the undersecretaries are CareerExecutive Service Officers (CESOs) who

are unlikely to be dislocated by any

reengineering effort. The other

undersecretary and the Secretary of

Health himself were former DOH

officials, serving as Head Executive

Assistant and Assistant Secretary,

respectively during an earlier period. In

terms of understanding the functions,

the structures and the needs of the

organization, they are considered

knowledgeable insofar as the needed

internal reforms are concerned.

There was also some realization that the

previous structure was not working very

well for the immediate as well as the

ultimate clients of the DOH are

concerned. A proposed bill in Congress

seeks the abolition of the DOH regional

units on the perception that these DOH

field offices presently do not serve the

LGUs as well as they should. Seen in this

light, the reengineering of the DOH

became a matter of institutional

survival.

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A number of laws recently passed also

provided for the staffing of new agencies

such as the Voluntary Blood Donation

Program, the Philippine National AIDS

Council, the Philippine Institute of

Traditional and Alternative Health Care,

as well as the increased staffing

requirement of the PhilHealth and the

newly renationalized hospitals.

Since the major shift in the DOH

reengineering is in the thinning out of CO

and building organizational muscle in the

field and operating units such as the

retained as well as the special and

specialty hospitals, dislocations were

minimized by deploying CO personnel to

the new agencies, the field offices and

the operating units.

What also became imminent and

necessary is the retooling and retraining

program, given the new or additional

skills that are required at CO as well as

in the field and the operating units. The

DOH management recognized this and

has in fact allocated funds for this

purpose.

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V arious working groups and committees were created through Department OrderNo. 380-D s. 1999 to affect a unified, smooth process of facilitating the

formulation of the RSP and of implementing change. These groups and

committees were:

Oversight Committee – Provided the

overall direction of the change program.

This committee was composed of the

Health Secretary, Undersecretaries and

Assistant Secretaries.

Reengineering Secretariat –

Provided the staff support to the

Oversight Committee and was

responsible for facilitation, coordination

and provision of technical assistance in

the change program and activities of all

offices in the CO, including the BFAD and

the NQO. A full-time Director under the

Office of the Secretary and a select staff

from the Health Policy Development

Staff and the Administrative Service

composed this group. A major

consideration in the selection of

membership to this group was their

commitment and willingness to work for

change.

Task Force on Personnel

Deployment and Budgetary

Requirements – This group was

organized on account of the inevitabledeployment of some CO personnel. This

group was tasked with the processing of

requests for voluntary deployment,

retirement and separation from office of

those affected by the reengineering

program. Aside from determining the

cost requirements and ensuring financial

resource, it was also responsible for the

development of integration programs for

the deployed personnel in the other DOHoffices.

Task Force on Information and

Communication – This group

developed helpful messages and

information to facilitate the wide

acceptance of the change process; and

disseminated information relative to

activities and programs of the different

committees involved in the DOH

reengineering.

Task Force on Retooling and

Counseling – This group conducted

orientation programs on the rationale

and need for change in the early stages

of the change process. The group

provided emotional support to those who

suffered from the stress brought about

by the organizational change. Prior to

the actual implementation of the neworganizational structure, this group

formulated a retooling/retraining

program that ensured that newly

organized offices and staff measure up to

the expectations of the new roles and

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functions of the DOH. The training

programs were designed for building

capacities for leadership in the health

sector and in support of the HSRA

implementation.

The Reengineering Desk – This washeaded by an Assistant Secretary and

was created primarily for “quick

response” to most of the commonly

asked questions about reengineering.

The group also helped in facilitating

several types of requests from affected

employees such as deployment and

transfer, counseling, retraining among

others.

Three consultants were hired for the

duration of the reengineering exercise in

the CO. They played a significant role in

the formulation and implementation of

the DOH Rationalization and Streamlining

Plan. They acted as a technical resource

in the day-to-day management of

change. In the process, some problems

cropped up with no answers from the

book, but were drawn from experience

and practice. The consultants provided

insights and direction during the change

process.

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The Change Management Process

To support the reengineering process,

the DOH Reengineering Technical

Committees and Secretariat carefullystudied and reviewed other guidelines

issued by the CSC and those enacted by

law, such as RA 6656 or An Act to Protect

the Security of Tenure of Civil Service

Officers and Employees in the

Implementation of Government

Reorganization (1988).

The basis of action and decision made by

the Selection and Placement and Appeals

committees for the implementation of

the approved reengineered DOH was

grounded on these rules and provisions.

The appeals made by protesting

employees also found strength and

support from these provisions.

The following were the activities and

mechanisms that facilitated or mitigated

the effects of the organizational change

process:

1. The Secretary of Health clarified

intentions and directions to the

undersecretaries and assistant

secretaries who acted as the

Oversight Committee and as team

leaders for their respective groups.

2. The Undersecretaries explained

intention and direction of

reorganization to units, agencies,

or bureaus in her/his cluster;

reviewed mandate given under EO

102 and the HSRA; and

documented frequently asked

questions for discussion and

feedback to the Executive

Committee (Execom) or Oversight

Committee.

3. The Secretary of Health

established the Reengineering Desk

headed by an Assistant Secretary

and backstopped by a Technical

Working Group or Secretariat

headed by a Director and

consultants coordinating with

several Task Forces which, sought

clearance from Execom or

Oversight Committee.

4. The Secretary of Health issued

guidelines for reengineering and

retooling. These are:

a. All DOH employees are

expected to be computer

literate thus minimizing the

need for clerical and

secretarial support.

b. CO staff must be retooled for

policy analysis, program

development, resource

coordination, mobilization and

technical supervision.

c. Field Unit staff must be

retooled for networking,

developing linkage, political

sensitivity, grassroots planning,grants administration and

technical assistance.

d. Hospital staff must be retooled

towards integrating public

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health concepts and issues

with clinical care.

e. DOH representatives to LGUs

must be retooled to respond to

LGU needs and not merely to

attend Local Health Board

meetings. They must also be

retooled as local health

advisors on all matters relating

to health.

5. The Secretary of Health issued

guidelines on managing the

reengineering process. These are:

a. DOH managers and senior

officials must present

themselves at all times to

answer all questions about

reorganization honestly and

without equivocation. Those

issues about which officials

were unsure or unhappy about

were brought to the

Execom/Oversight Committee

for quick resolution.

b. The central message was that

even with redeployment, the

DOH remains a family.

Whether one is in the CO, the

regions or any of the hospitals,

one continues to be part of

DOH whose services can be

counted towards retirement

and where security of tenure,

given adequate behavior andperformance, remains assured.

c. Success stories on

redeployment should be

documented and disseminated.

Problems encountered should

similarly be documented and

addressed operationally. An

example was the inability of

the redeployed person to get

his salary as soon as possible.

Another problem was the

unwillingness of the regions to

advance the salary despite

order from the Secretary.

d. Frequently asked questions

should be documented and the

answers to these questions

should be consistent and

widely distributed.

e. Unresolved issues such as

staffing numbers or position

titles were not disseminated

until approved by the

Secretary to prevent

unwarranted speculation. The

only certain thing about the

reengineering exercise is that

nobody will lose his/her job.

f. Alternatives to redeployment

were clearly presented.

Among these are:

Employment in DOH-attached

agencies where additional

staffs are mandated by law but

has not been approved or

confirmed by DBM. Examples

of these are PNAC, PITAHC and

NVBDP.

Redeployment was also made to

special, specialty and retained

hospitals in Metro Manila during

the voluntary deployment

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period. When the staffing

pattern is approved, the

Secretary reserves the right to

re-deploy personnel where they

are most needed.

Retirement or separation

benefits (for those not yet

qualified to retire) were made

available under existing laws.

The reengineering team

deployed available personnel

who computed the amount of

these benefits for specific

employees.

The assistance of DOLE and CSCwere sought relative to job

hunts, both within government

itself (in case employees want to

transfer to other government

agencies) and outside the

country. A job fair put together

overseas, government and

within-DOH jobs that highlighted

other options available to

employees who did not wis

DOH Reengineering Monograph

Documents

Transcript of DOH Reengineering Monograph