Two House committees on Tuesday formally recommended the filing of criminal charges against Health Secretary Francisco Duque 3rd, former Philippine Health Insurance Corp. (PhilHealth) president Ricardo Morales, and other PhilHealth officials who were allegedly involved in irregularities within the state insurance firm.
The House committees on public accounts and on good government and public accountability approved the 65-page report on their investigation into the alleged graft and corruption in PhilHealth.
The committee report recommended the filing of charges against Duque, Morales, and other PhilHealth executives for violation of Section 3 of the Anti-Graft and Corrupt Practices Act and Art. 22 of the Revised Penal Code on alleged illegal use of public funds in connection with the anomalous implementation of the interim reimbursement mechanism (IRM).
Other PhilHealth officials to be charged include Executive Vice President and Chief Operating Officer Arnel de Jesus, Senior Vice President for Health Finance Israel Francis Pargas, Senior Vice President for the Legal Sector Rodolfo del Rosario, Senior Vice President for the Fund Management Sector Renato Limsiaco, and Senior Manager for the Internal Legal Department Rogelio Pocallan Jr.
“While the idea behind the IRM may be commendable, the mechanism itself is flawed and encourages large scale corruption and collusion between PhilHealth officials and HCIs (health care institutions) and while the program uses the term reimbursement, the IRM is actually a cash program, the legal basis of which PhilHealth has failed to provide this investigative body,” the report read.
Despite having unclear legal basis of the IRM, the committees noted that some PHP15 billion of funds have been distributed by PhilHealth to various HCIs all over the country.
“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 said.
The report also highlighted that IRM allocations are excessive relative to the estimated cost of coronavirus disease 2019 (Covid-19) hospitalizations. The P26.8-billion authorized IRM allocation, of which P14.9 billion had been released as of August 10, is 712 percent in excess of what is required.
IRM funds were used for non-Covid-19 cases, as well as for the upcasing of cases, particularly allowing the use of Covid-19 case rates for merely suspected or probable Covid-19 patients.
The committees determined that amendatory and remedial legislations are necessary to address these irregularities.
They sought the passage of the proposed PhilHealth Crisis Act, a measure addressing the social health insurance crisis, and a bill seeking to amend Section 10 of the Universal Health Care Act.
“PhilHealth needs to be overhauled to respond to the health needs of its entire clientele which is the Filipino nation, especially those belonging to the marginalized sectors,” they said.