THE House Committee on Public Accounts and House Committee on Good Government and Public Accountability on Tuesday recommended the filing of criminal charges against Health Secretary Francisco Duque III, former Philippine Health Insurance Corp. (PhilHealth) President and CEO Ricardo Morales and other PhilHealth executives and four members of the Cabinet in connection with alleged corruption in the agency.
In their 65-page joint report, two panels approved the filing of charges for violating Section 3 of Republic Act (RA) No. 3019 or the Anti-Graft and Corrupt Practices Act, and Article 220 of the Revised Penal Code on the illegal use of public funds against Duque, Morales, PhilHealth executives Arnel de Jesus, Israel Pargas, Rodolfo del Rosario and Rogelio Pocallan Jr., PhilHealth board members Maria Graciela Blas Gonzaga, Susan Mercado, Alejandro Cabading and Marlene Padua.
The committees, chaired by Anakalusugan Rep. Michael Defensor and Bulacan Rep. Jonathan Sy-Alvarado, also recommended the filing of the same charges against Cabinet members sitting on the PhilHealth Board, namely, Labor Secretary Silvestre H. Bello III, Finance Secretary Carlos G. Dominguez III, Budget Secretary Wendel E. Avisado and Social Welfare Secretary Rolando Bautista.
Overpayment
THE committees also revealed that PhilHealth has an overpayment by as much as P102 billion to hospitals under the all-case-rate system from 2013 to 2018.
“Most importantly, the legal basis of the IRM [Interim Reimbursement Mechanism] is unclear. Despite this, some P15 billion of funds have been distributed by PhilHealth to various health-care providers all over the country,” the panels said.
IRM is an advanced payment scheme to give health-care institutions cash in advance to respond natural disasters and calamities.
“In what is arguably the most notorious instance of corruption to date that is connected to the corporation, PhilHealth officials involved in the illegal disbursement of public funds through this mechanism anchor their defense on blurry interpretations of the law, none of which will hold water in court,” the report added.
The committees said while PhilHealth claims it is struggling financially due to the Covid-19 pandemic and asserts that its remaining actuarial life is down to one year, “the Joint Committees find, based on the data provided in the several submissions by PhilHealth, that PhilHealth has been overspending on Covid-19.”
“The most tragic outcome of the flawed IRM scheme is that despite huge amounts of advances made in favor of select hospitals, a bulk of the payments are made for non-Covid-19 claims, thus, crowding out funding that could be used to ensure access to hospital care for Covid-19 patients when urgently needed,” the report said.
As of August 10, 2020, the committees said a total of about P2.39 billion of IRM funds have been liquidated, of which P1.21 billion has been liquidated by private healthcare institutions.
Besides the lack of legal basis in implementing the IRM, the panels said PhilHealth, in its implementation of its case-based payment system, has allowed the use of Covid-19 case rates for merely suspected or probable Covid-19 patients, and “this is tantamount to a legitimized form of upcasing.”
The committees also noted the “disadvantageous settlement” made by the insurance agency with Perpetual Succor Hospital of Cebu Inc. (PSHCI), Cardinal Santos Medical Center (CSMC) / Hospital Managers, Inc. (HMI), WellMed Dialysis and Laboratory Center Corporation, Medina General Hospital (MGC), Accenture Inc., B. Braun Avitum Philippines Inc. (B. Braun) and Balanga Rural Bank Inc. (BRBI).
Legislative proposal
The panels also recommended the passage of the proposed Philippine Health Insurance Corporation Crisis Act of 2020, which grants the President special powers to reorganize the PhilHealth.
For this purpose, the President may abolish or create offices; split, group or merge positions; transfer functions, equipment, properties, records and personnel; institute drastic cost cutting measures and take such other related actions necessary to carry out the purpose herein declared.
The bill said the authority granted to the President under this proposal shall subsist, be valid and effective for a period of one year from the effectivity of this proposal, unless otherwise withdrawn or extended by a Resolution of Congress.
In order to protect the funds of Philhealth and cleanse the agency of graft and corruption, the measure said the President may enter into negotiated contracts for certain services.
The bill also grants the President a special power to reorganize the PhilHealth to make it more effective, innovative and responsive to its current problems and concerns as regards sustainability of funds and issues regarding graft and corruption, among others.
Flavor of the month
“I’m always the flavor of the month.”
This was the reaction of Duque to the House committees’ recommendation for the filing of charges against him.
He said they just keep repeating the same issues he faced when he attended a Senate hearing in August.
“Matagal na ‘yang issue na ‘yan, August pa sa Senate pa lang. parehong- pareho naman ang issue na ‘yan eh [That is an old issue, in August that was brought up in the Senate ]. Unang-una [First], I did not sign the resolution approving the IRM [Interim Reimbursement Mechanism] implementation,” Duque told the BusinessMirror in a phone interview stressing that he did not sign any document “because I was absent beginning March, April and May for I was appointed as chairman of the Inter -Agency Task Force.”
Duque reiterated that as a non-voting Chairman under the Universal Health Care Law it is unfortunate that he was being impleaded in the alleged IRM irregularities.
He said, was not even present during the deliberation nor did he sign the PhilHealth Board Resolution No. 2515 dated 31 March 2020.
“I assumed the more important duty to head the IATF who at that time was heavily, aggressively responding to the massive problem of Covid-19 pandemic,” he said.
Duque said that he respects the decision of the Ombudsman after it issued a preventive suspension order against five personnel of the Department of Health on the alleged anomalies in the handling of the Covid-19 pandemic.
The Ombudsman investigated the following issues:
- the delayed procurement of personal protective equipment (PPE) and other medical gear necessary for the protection of healthcare workers
- alleged lapses and irregularities that led to the death of medical workers and the rising number of deaths and infected medical frontliners
- inaction in the release and processing of benefits and financial assistance of infected and those medical front liners who succumbed to the disease
- the confusing and delayed reporting of COVID-19 related deaths and confirmed cases
Image credits: AP/Aaron Favila