July 31, 2009

DOH ADMINISTRATIVE ORDER NO. 2009-0015

SUBJECT : Interim Policies and Guidelines for Endorsement of

Applications for Registration of Global Healthcare or
Medical Tourism Projects Under the Board of
Investments (BOI) and the Philippine Economic Zone
Authority (PEZA)

I. Rationale
Section 11, Article XIII of the 1987 Constitution provides that: "The
State shall adopt an integrated and comprehensive approach to health
development which shall endeavor to make essential goods, health and
other social services available to all the people at affordable cost".
In formulating an integrated and comprehensive approach to health
development, nonetheless, the Philippine government, in light of
globalization and technological development, has recognized the emergence
of global healthcare or medical tourism as a growing segment of the
country's tourism and health care sectors. Accordingly, several laws and
executive issuances covering investments in various fields, including health
infrastructure, health services, technology, research and development, were
issued to take advantage of the growing medical tourism.
Additionally, the government has recognized the invaluable
participation and contribution of the private health sector in the emergence
of medical tourism in the country. As a matter of fact, the Department of
Health (DOH), in its National Objectives for Health (NOH) 2005-2010, has
acknowledged the roles and responsibilities of the private sector as
producers of goods, services and technology for use by health providers and
consumers. Succinctly, medical tourism has the capacity to improve the
healthcare system by generating additional resources for investment in
healthcare; it can become an important source of foreign exchange
earnings; and it can add to the multiplier effects of tourism-related activities.
aIHCSA

Accordingly, Her Excellency President Gloria Macapagal-Arroyo issued

Executive Order No. 372, series of 2004, to create the Public-Private Sector
Task Force for the Development of Globally Competitive Philippine Service
Industries, in order to develop the potential of the country's globally-
competitive service industries to generate employment and earn foreign
exchange. Moreover, Executive Order No. 571, series of 2006 was issued to
create a Public-Private Sector Task Force on Philippine Competitiveness
which would promote and develop national competitiveness by seeing to the
implementation of the Action Agenda for Competitiveness.
In support of E.O. No. 372, s. 2004, the Board of Investments included
the health and wellness products and services in the 2005 Investment
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 Priorities Plan (IPP). On November 14, 2006, the Philippine Economic Zone
Authority (PEZA) issued Board Resolution No. 06-512 approving the
Guidelines for the Registration of Medical Tourism Special Economic Zones
(Medical Tourism Parks/Centers) and Medical Tourism Enterprises under
Republic Act No. 7916, as amended.
Although there are already administrative issuances, namely
Administrative Order No. 6, series of 1998, and Administrative Order No. 81,
2000, issued by the DOH pertaining to guidelines for endorsement of
applications for BOI registration of healthcare projects, there are, as yet, no
guidelines for endorsement of applications for PEZA registration of Medical
Tourism Special Economic Zones (Medical Tourism Parks/Centers) and
Medical Tourism Enterprises. More importantly, at the moment, the DOH has
yet to formulate and issue a National Policy Framework for the
Implementation of Medical Tourism Program.
Be that as it may, pending the composition and issuance of the
National Policy Framework for the Implementation of the Medical Tourism
Program, the DOH recognizes the need for an interim set of policies and
guidelines governing the endorsement of applications for registration of
global healthcare or medical tourism projects under the BOI and PEZA.
However, in issuing these interim policies and guidelines, the DOH
recognizes the following risks in pursuing medical tourism, namely: (a) it
may create a dual market structure with higher quality care being supplied
to affluent consumers to the detriment of the health care needs of poorer
segments of the country; (b) the potential crowding out of the population
from higher standard health facilities at the expense of the public healthcare
system; and (c) it may attract scarce human resources for health away from
public healthcare institutions.
Accordingly, the issuance of these interim policies and guidelines aims
to make a convergence and collaboration between the public health sector
and private sector initiatives to achieve sustainable and equitable medical
tourism in the country.
II. Scope
The scope of this Order shall cover endorsement by the DOH of
applications for BOI registration of health care projects; applications for
medical tourism economic zone developer/operator; applications for PEZA
registration of health facilities as medical tourism enterprises, medical
tourism parks and/or centers in medical tourism economic zone; and
evaluation of medical devices and equipment being applied for duty-free and
tax-free importation required for the technical viability and operation of the
registered activity/ies. This Order shall apply pending the formulation and
issuance of the National Policy Framework for the Implementation of Medical
Tourism Program. DECSIT

III. Objectives
This Order is being promulgated to provide an interim set of policies
and guidelines governing the endorsement of applications for registration of
global health care or medical tourism projects under the BOI and PEZA.
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 These interim policies and guidelines shall apply pending the formulation and
issuance of the National Policy Framework for the Implementation of Medical
Tourism Program.
IV. Definition of Terms
Medical Tourism — is the travel to the Philippines for the purpose of
availing quality but affordable healthcare services or treatment of illnesses
and health problems in order to maintain one's health and well-being.
Medical Tourism Economic Zone (MTEZ) — a selected area which is
highly developed or which has the potential to be developed into a Medical
Tourism Park/Center whose metes and bounds are fixed or delimited by
Presidential Proclamation. Medical Tourism Parks/Centers shall be planned
and designed in accordance with the standards of the Department of Health
(DOH) and the Department of Tourism (DOT) to have support facilities and
services required for health and wellness.
Medical Tourism Center — either a medical hospital or a stand-alone
building attached to a hospital that hosts specialized medical clinics and
other specialized medical related activities, in compliance with DOH
requirements, the whole or part of which has been developed to provide
infrastructures and other support facilities required by Medical Tourism
Enterprises, and which may also provide amenities required by foreign
patients including professionals and workers involved in medical tourism
activities. Other than a medical hospital, a stand-alone building attached to a
hospital shall have a minimum floor area of five thousand (5,000) square
meters for Metro Manila and Cebu City, and two thousand (2,000) square
meters minimum floor area for the provinces and cities outside of Manila and
Cebu City. ACTEHI

Medical Tourism Economic Zone Developer/Operator — a business

entity duly endorsed by the DOH and registered with PEZA to develop,
operate and maintain a Medical Tourism Park/Center and with required
infrastructure facilities and utilities such as light and power system, water
supply and distribution system, sewerage and drainage system, pollution
control devices, communication facilities, and other facilities as may be
required for a medical tourism economic zone.
Medical Tourism Enterprises — a corporation or other form of business
entity which has been endorsed by the DOH and registered with the PEZA to
engage in the practice of medical health services with foreign patients as
primary clientele.
Medical Tourism Park — an area which has been developed into a
complex capable of providing medical infrastructures and other support
facilities, in compliance with DOH and DOT requirements, such as but not
limited to medical accommodations, wellness centers, spa, health farms,
sports and recreational facilities, and rehabilitation facilities required by
Medical Tourism Enterprises, as well as amenities required by foreign
patients including professionals and workers involved in Medical Tourism
activities. A Medical Tourism Park shall have a minimum lot area of one (1)
hectare.
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 Philippine Council for Accreditation of Healthcare Organizations
(PCAHO) — non-government organization involved in accreditation of
facilities engaged in international medical travel services using recognized
standards in quality, safety and medical travel. CDTSEI

Joint Commission International (JCI) — not-for-profit organization

focused on improving the safety of patient care through the provision of
accreditation and certification services as well as through advisory and
educational services aimed at helping organizations implement practical and
sustainable solutions.
V. Interim Policies
1. Global healthcare or medical tourism projects under BOI and
PEZA, including the creation of MTEZ, medical tourism
centers, medical tourism parks, and medical tourism
enterprises, must be considered as part of the Philippines'
integrated and comprehensive approach to health
development which endeavors to make essential goods,
health and other social services available to all the people at
affordable cost.
2. Registration of global healthcare or medical tourism projects
shall always take into account its impacts on the Philippines'
public healthcare system. Hence, the DOH shall exercise
prudence and sound judgment in issuing endorsements of
applications for registration of global healthcare or medical
tourism projects, taking into consideration that such
endorsement may lead to the creation of a dual market
structure with higher quality care being supplied to foreign
patients and affluent consumers to the detriment of the
health care needs of the poor; the potential crowding out of
the population from higher standard health facilities at the
expense of the public healthcare system; and internal flight
of limited human resources for health away from government
hospitals and public healthcare institutions.
3. Applicants for registration of global healthcare or medical
tourism projects must provide programs, mechanisms, or
strategies which share the benefits of medical tourism with
the public healthcare system through public service, which
include but not limited community-building projects,
sponsorship of PhilHealth premium, expansion of service
wards and facilities, scholarship programs, training
agreements between public hospitals and private hospitals
and health promotion activities. TacSAE

VI. Interim Guidelines

1. Applicants for registration of global healthcare or medical
tourism projects under BOI and PEZA, including the creation
of MTEZ, medical tourism centers, medical tourism parks, and
medical tourism enterprises, who/which seek the favorable
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 endorsement of the DOH must secure a referral letter from
either the BOI or PEZA, as the case may be, where they filed
their registration applications. Such referral letter, which
must be addressed to the Office of the Secretary of the DOH
(DOH-OSEC), shall be accompanied by the following
supporting documents and shall show the prima facie
registrability of the enterprise or activity with the BOI or
PEZA:
(a) Background information on applicant;
(b) Detailed description/feasibility study;
(c) List of medical devices and equipment, including
specifications and quotations/costs of each item;
(d) Documentation of efficacy and safety of the
technology/equipment;
(e) Sworn statement stating all the information and data
submitted are true and correct;
(f) Authenticated proof of authority for signatory of
applicant in the submitted documents (either
Secretary's Certificate, Board/Partnership Resolution, or
affidavit);
(g) Proof that foreign clients are the primary clientele; and
(h) Sworn statement affirming compliance with the
conditions after BOI or PEZA registration provided in
this Order.THaAEC

(i) Proposed social responsibility actions and funding

commitments.
2. Upon receipt of the BOI or PEZA referral letter and supporting
documents, the DOH-OSEC shall forward it to the Technical
Evaluation Committee (TEC), which shall be responsible for
the evaluation the applicants for registration for health care
projects under BOI and for registration of health facilities
under PEZA under the various existing categories. The TEC
shall be created through a Department Personnel Order
(DPO) and shall be chaired by the Undersecretary for PSDT
Regulatory Cluster and vice-chaired by the Assistant
Secretary for Office for Special Concerns. The following
bureaus and offices shall be members of the TEC: Bureau of
Health Facilities and Services (BHFS); National Center for
Health Facility Development (NCHFD); Bureau of Food and
Drugs (BFAD); Bureau of Health Devices and Technology
(BHDT); Health Policy Development and Planning Bureau
(HPDPB); Bureau of International Health Cooperation (BIHC);
Research Institute for Tropical Medicine (RITM); President,
Association of Health Administrators, Inc.; Center for Health
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 Development (CHD) having jurisdiction over proposed
location of the healthcare or medical tourism project; and
such other bureaus, offices, and persons deemed relevant
and competent by the DOH-OSEC.
3. The TEC shall have the following functions:
(a) Validate the veracity of documents submitted for
evaluation.
(b) Review and evaluate the guidelines, the application for
BOI registration of health care projects and PEZA
registration of health facilities as medical METZ,
medical tourism centers, medical tourism parks and
medical tourism enterprises.
(c) Recommend endorsement or non-endorsement of
these applications to the Secretary of Health.
(d) Recommend that guidelines/requirements relative to
the aforementioned processes are updated when
necessary. EcSCHD

4. The TEC shall determine and confirm if the proposed global

healthcare or medical tourism project shall engage in the
following facilities or activities, such as but not limited to:
(a) Facilities — Level III or Level IV General Hospitals
and/or Medical Centers; Level III or Level IV
Special/Specialty Hospitals and/or Medical Centers;
Level III General or Specialized Diagnostic Imaging
Centers; Tertiary General Diagnostic Clinical
Laboratories; Special Clinical Laboratories for Molecular
Biology and Biotechnology;
Physical/Occupational/Speech Therapy Rehabilitation
Facilities; Substance Abuse Treatment and
Rehabilitation Centers (TRCs); Acute-Chronic and/or
Custodial Psychiatric Care Facilities and other health
facilities for the mentally ill; Ambulatory Surgical
Healthcare Facilities attached to Hospitals; and other
facilities attached to a hospital that provide health or
health-related services.
(b) Hospital-Based Services — Medical Services
(Allergology, Clinical Immunology, Rheumatology,
Cardiology, Clinical Genetics, Clinical Nutrition,
Emergency Care, Endocrinology and Metabolism,
Gastroenterology, Infectious and Tropical Diseases,
Nephrology, Neurology, Psychiatry, Radiology,
Radiotherapy, and Interventional Radiology,
Hematology, Oncology or Cancer Medicine,
Pulmonology, Critical Care, Geriatric Care, Lifestyle
Health Service, Dermatology, Pain management,
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 Complementary and Integrative Medicine); Surgical
Services (Neurosurgery, Cardiothoracic surgery,
Gastroenterology surgery, ENT, Ophthalmology,
Urology, Orthopedics, Cosmetic, Plastic, and
Reconstructive Surgery); Obstetric and Gynecologic
Services; Pediatric, Perinatology and Neonatology
Services; Dental and Orthodontic Services; Optometry
and Orthoptic Services; Spa and Health Farms; and
Drug Addiction Treatment and Rehabilitation Services.
Provided that, any proposed healthcare or medical
tourism project that will provide transplant surgery
services shall not be endorsed by the DOH.
(c) Medical Tourism Parks/Centers to be located in
accordance with and subject to the conditions provided
in PEZA Resolution No. 06-512.
5. The proposed facility or activity must strictly comply with all
existing laws, rules, regulations and issuances pertinent to
hospital operations, health services delivery and regulation.
6. The TEC shall determine and confirm if all of the following
conditions are present in case the proposed facility or activity
claims for fiscal incentives in relation to medical devices or
medical equipment, viz.:
a) The medical devices or medical equipment must be
brand new and up-to-date.
b) Procurement and use of the said medical devices and
equipment must have complied with all the necessary
health regulatory documents and permits from the
country of origin and from the BHDT. AEIcTD

c) The medical devices or medical equipment shall be

solely used for therapeutic and/or diagnostic purposes
limited to the medical tourism services.
d) The medical devices or medical equipment shall have a
minimum freight-on-board (FOB) unit cost of One
Hundred Thousand US Dollars (US$100,000.00). The
minimum FOB cost shall be determined and periodically
reviewed every two (2) years by the BHDT based on the
prevailing cost of medical devices or equipment. The
BHDT shall recommend basis for future determination
of the minimum FOB cost of medical devices or
equipment which may be used as a basis by the TEC.
e) The medical devices or medical equipment must be
fixed to or owned by the proposed facility or activity
and cannot be considered as personal property.
f) The medical devices or medical equipment must not be
locally-manufactured.
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 7. The proposed healthcare or medical tourism project must
use health care technology that has been scientifically
proven effective, safe and evidence-based.
8. The proposed facility or activity must provide the same
quality of care, technology and services for Filipinos,
foreigners and foreign-based patients. It must also provide
the same quality healthcare to service patients. cHCIDE

9. Facilities must submit a detailed program, mechanism, or

strategy which provides public service, such as, but not
limited to, community-building projects; establishment of
service beds numbering at least ten percent (10%) of the
authorized total bed capacity pursuant to Administrative
Order No. 2007-0041; scholarship programs; and training
agreements between public hospitals and private hospitals.
10. The TEC shall have thirty (30) working days to review,
validate, evaluate, and issue its recommendations as regards
the applications to the DOH-OSEC. In case the TEC cannot
complete its evaluation and recommendations in 30 working
days, it shall inform the DOH-OSEC and the applicants of the
need to extend the proceedings and the additional period of
time required to finish it but in no case shall the extension be
longer than sixty (60) working days.
11. The TEC shall forward its written recommendations to the
DOH-OSEC for final approval or disapproval by the Secretary
of Health.
12. The DOH-OSEC shall transmit the approved or disapproved
endorsement to the BOI or PEZA. A copy shall be furnished to
the secretariat of the TEC.
VII. Conditions After BOI or PEZA Registration
1. Global healthcare or medical projects that have been
granted approved endorsements by the DOH shall provide a
certified true copy of their BOI or PEZA registration to the
DOH-OSEC within fifteen (15) days from issuance thereof. SDHAEC

2. Facilities that have been granted an approved endorsement

by the DOH shall secure the following licenses and/or
accreditation within the prescribed timeframe:
(a) License to Operate from the BHFS or the CHD, as the
case maybe, prior to the start of operations;
(b) Accreditation from the Philippine Health Insurance
Corporation (PhilHealth) after three (3) years from
issuance of the License to Operate in case of new
facilities. Provided that in case of existing facilities, the
PhilHealth Accreditation must be secured within 3 years
from the issuance of the favorable DOH endorsement;
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 (c) Recognition as a "Center of Excellence" using the
PhilHealth Bench Book standards within five (5) years
from issuance of the License to Operate in case of new
facilities. Provided that in case of existing facilities, the
"Center of Excellence" recognition must be secured
within 5 years from the issuance of the favorable DOH
endorsement; and
(d) Accreditation from PCAHO or JCI within three (3) years
from issuance of the License to Operate in case of new
facilities. Provided that in case of existing facilities, the
PCAHO or JCI Accreditation must be secured within 3
years from the issuance of the favorable DOH
endorsement.
3. Facilities or activities that have been granted approved
endorsement shall furnish the DOH-OSEC with the following:
(a) Annual report of statistics of foreign/foreign-based
medical travelers and patients who availed themselves
of the specific medical and diagnostic procedures
and/or facilities and other hospital services utilization
statistics;
(b) Annual report of statistics on quality and safety in
healthcare performance-based monitors;
(c) Annual report of actual income derived from foreign-
based patients' hospitalization and also utilization of
medical devices, equipment and specialized units
granted fiscal incentives by the BOI or PEZA; CaHcET

(d) Annual report of actual expenditures of the health

facility spent for service patients' inpatient and
outpatient treatment, diagnosis of their condition,
prevention and control of diseases;
(e) Annual report of statistics of service patients provided
with similar medical attention and care as
foreign/foreign-based medical travelers and patients;
and
(f) Annual report of compliance to their detailed program,
mechanism, or strategy which provides public service,
such as, but not limited to, community-building
projects; establishment of service beds numbering at
least ten percent (10%) of the authorized total bed
capacity pursuant to Administrative Order No. 2007-
0041; scholarship programs; and training agreements
between public hospitals and private hospitals.
(g) Annual submission of notarized list of medical devices
or equipment procured/secured through DOH
endorsement, specifying the brand, serial number,
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 model, number of units, and date of purchase.
4. A quality assurance as well as quality control and safety in
health care program must always be maintained by the said
health facilities subject to periodic evaluation and review by
appropriate DOH bureaus, centers and offices.
5. Facilities or activities must provide the same quality of care,
technology and services for Filipinos, foreigners and foreign-
based patients. They must also provide the same quality
healthcare to service patients.
6. Facilities must dutifully comply with their submitted detailed
program, mechanism, or strategy which provides public
service. Compliance shall be subject to periodic evaluation
and review by appropriate DOH bureaus, centers and offices.
7. Facilities must be willing to collaborate with DOH in research
and training activities.
VIII. Monitoring and Evaluation of Endorsed Facilities
Facilities or activities that have been granted approved endorsements
shall be monitored and evaluated on a semi-annual basis. Monitoring and
evaluation shall include site visits and analysis of submitted reports to DOH
and surveys, as may be deemed necessary by the DOH-OSEC. AEHCDa

Any adverse report, public health threat, market distortion and the like
that are created as a result of services being provided by the endorsed
facility or activity shall result in the automatic review and amendment of this
Order.
IX. Investigation of Complaints, Violations, and Sanctions
Any violation of the provisions of this Order shall be reported to the
DOH-OSEC and, after notice and hearing, shall be meted out appropriate
administrative penalties and sanctions provided under existing laws, rules
and regulations.
Meanwhile, any person or interested party shall refer the complaints or
charges against the hospital or healthcare facility to the BHFS or concerned
CHD. All violations relevant to hospital operations, health service delivery,
and/or health facility regulation committed by the involved hospital or health
care facility shall be reported to the appropriate regulatory body and shall be
meted out appropriate penalties and sanctions provided under the violated
law or issuance.
Lastly, any violation of or non-compliance with the provisions of this
Order shall result in the imposition of the following sanctions against the
erring facility, namely: (1) removal from the list of DOH partners; and/or (2)
non-endorsement by the DOH of any future request of the facility, including
denial of request for endorsement involving claims for fiscal incentives in
relation to medical devices or medical equipment.
X. Appeal

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 Any applicant aggrieved by the decision of non-endorsement by the
Secretary of Health shall have the right to file an appeal within fifteen (15)
calendar days from the receipt of the official communication sent by DOH-
OSEC. Upon receipt of the appeal, the DOH-OSEC shall refer the matter to
the TEC to review the appeal of the applicant. Within 15 days from receipt of
the appeal, the TEC shall forward its written recommendation to the DOH-
OSEC OSEC for final approval or disapproval by the Secretary of Health,
whose decision shall be deemed as final and executory.
XI. Separability Clause
In the event that any provision of this Order is declared
unconstitutional or invalid by a court of competent jurisdiction, the other
provisions thereof shall not be affected thereby.ASTcEa

XII. Repealing Clause

All administrative orders and other issuances or part thereof
inconsistent with the provisions of this Order are hereby repealed or
amended or modified accordingly.
XIII. Effectivity
This Order shall take effect fifteen (15) days after its publication in the
Official Gazette or in a newspaper of general circulation.

(SGD.) FRANCISCO T. DUQUE, III, MD,

MSc.
Secretary of Health

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