Category Archives: Cost of Living in the Philippines

Costs of Living in the Philippines

The hidden cost of upgrading your hospital room in the Philippines

There is one very important piece of information that expatriates living in the Philippines should be aware of when it comes to hospitalization fees in the Philippines: the higher the room rate, the higher the cost of services.  This is the rule for many hospitals, which is sometimes referred to as “socialized pricing”.

So, if find yourself needing to stay at a hospital, and you feel like upgrading to a larger room, thinking that it’s only the difference of the room rates you’ll have to pay extra, think again.  If you pick an room with a daily rate of PhP4,000, as opposed to one that is PhP2,000, you will pay not only the additional PhP2,000, but also a premium over the hospital medical service charges, even though the services received in either room would be the same. In some cases, a premium may also apply to medications or pharmacy charges.

How do we know this?  From experience:  In July, 2011, my American husband went to the emergency room of a local hospital for high-grade fever and pains on his throat and ear.  Turned out he had tonsillopharyngitis, and had to be checked in at the hospital for treatment.  The highest room category that his employer-provided health insurance covered for that particular hospital was the “regular private room” which was for PhP1,650 per day.  But on the first day, the cheapest available room was a “mini-suite” for PhP4,200 per day.  Since it was an emergency, we had no other choice but to get the mini-suite. He stayed in that more expensive room for two days, until a private room became available.

When his chills and fever did not subside after three days, the hospital did blood and urine test and x-rays, including tests for dengue, typhoid, and malaria.  It was found out that in addition to the tonsillopharyngitis, he also had community-acquired pneumonia.  He was put on a closer watch, and the doctors switched his antibiotics to much stronger ones.

My husband was in the hospital for ten days.  Luckily, all of the PhP170,000+ hospital tab was covered by his health insurance except, of course, the “upgrade” which was  PhP5,100 (PhP2,550 x 2 days), plus an extra PhP3,900 premium, for a total of PhP9,000.  I’m pretty sure that if we hadn’t downgraded, we would have paid a lot more than PhP4,500 additional per day, since more testing – the price of which is correlated with the room rate – was done after we had transferred to the insurance-covered regular private room.

The only noticeable difference between the two rooms was furnishings.  Both have a companion bed, television, airconditioning, a private bathroom, and refrigerator.  But, the mini-suite had an extra chair with an ottoman, a small table with two small chairs, an extra sink, roll-up roman shades instead of mini-blinds, and an automated self-reclining, as opposed to hand-cranked, hospital bed.  These are extras we could do without, though I have to admit the automated bed is nice to have.  But for an additional of at least PhP4,500 per day, or PhP45,000 for 10 days if we didn’t downgrade, I’d rather get the cheaper room and crank up the bed myself.

I think every newcomer to the Philippines, whether they be expatriates,  balikbayans or tourists, including those who are still abroad and are planning to move here, should be informed of this not-so-known practice of socialized pricing at hospitals.  Otherwise, they would be up for a very unpleasant surprise once they see the hospital bill.

And if you find yourself in the only available hospital room but one that is beyond your budget, sign up for a wait list for your preferred cheaper room immediately, as the wait list gets longer by the hour. Do a visual too of the different rooms.  Sometimes, the real difference between the rooms is just their name.

Stay safe in the Philippines.

The real cost of building a house in the Philippines

I was curious about what expatriates think or write about the living in the Philippines, and looked through amazon.com and did a search for “guide to moving living in Philippines.” Of all the books that came up, this book struck my attention: How to Move to the Philippines: The Ultimate Guide to Paradise. The word “ultimate” was the one that got me in it. Next was the bad reviews. Except for one which had 4 stars (5 of which is the highest, and 1 the lowest), the other five reviews had 1 or 2 stars.

I did not have to even have to use amazon.com’s “Look Inside” feature to know it will be a bad buy. One can even write an entire blog to criticize every point in Product Description and About the Author. There statements are just plain silly, if not misleading. If taken seriously, it might lead an expatriate or retiree to go blow out their money and go broke. It’s good that this book is already out of stock.

Take for example the statement “own a mansion with Butlers and Maids for a modest price.” That is far from reality. In actuality, building costs for a mansion in the Philippines is at the least 12 million pesos, excluding the furnishings, and land. It is cheaper than a mansion built in the US, but still, at the exchange rate of PhP43 / US$1, that’s over US$ 260,000.  Hardly a modest sum. And costs are rising.

It’s even more expensive outside of Luzon, if not just outside Metro Manila, as most building materials and contractors are based in Metro Manila. I run a small glass and aluminum contracting business, and sometimes homeowners and builders outside of Luzon would order from me their windows and doors, which they ship via ferry, as these products are more expensive if the materials are to be bought there.

If I want to have a piece of land of 300 square meters here in Metro Manila and have a house built on it, I would need to have on hand around PhP8-9 million. (And that would be if I were to manage a huge part of the building process. Less than 3 years ago, it was just at around PhP6 million.) If we have half of the PhP8 million or so out of our pockets and the rest in a loan, the monthly premium would be around PhP52,000 at 10% or roughly US$1,200 (We don’t have PhP4 million and the bank probably won’t give us a loan, at least not yet, which are why we’re still living with my parents).

“Owning a mansion with Butlers and Maids for a modest price” looks like very attractive and enticing reason for moving to the Philippines. But people who want to move here should really do research. Otherwise¸ they might blow out their savings in less than a year. (And if you look at a expat blogs, some actually admit that they blew out their money in their first year. Could that be due to underestimating the cost of building a house?) And the worse thing than living on a modest pension in the US is being stuck with no money in the Philippines.