MALACAÑANG on Tuesday, September 15, 2020, said President Rodrigo Duterte has approved the recommendation to file criminal and administrative charges against some former and incumbent executive officers of state-owned Philippine Health Insurance Corporation (PhilHealth).
In his virtual press conference Tuesday, Presidential Spokesperson Harry Roque said former president and CEO Ricardo Morales will be among those who will be charged.
Based on the report of Task Force PhilHealth, which was submitted to the President on September 14, other executives who will be charged are Jovita Aragona, senior vice president for information management sector; Calixto Gabuya Jr., acting senior manager of the information technology and management department; Renato Limsiaco Jr., senior vice president for fund management sector; Arnel de Jesus, executive vice president and chief operating officer; and Israel Francis Pargas, senior vice president for health finance policy sector.
"I am sorry for them but they would have to undergo trial. Although, they can always prove their guilt beyond reasonable doubt. Wala pa namang ano pa eh. The presumption of innocence still attaches but the report of another agency says otherwise. So gano'n ho ang nangyari sa PhilHealth, halos lahat sa board," Duterte said in his televised meeting with some Cabinet members Monday night, September 14.
Roque said the task force report found that PhilHealth's board of directors and executive committee "have not shown the due diligence required of them in the discharge of their duties, particularly in the disbursement of the National Health Insurance Fund."
This was indicated in the following acts of the board and executive committee:
IRM fund releases
Roque said the task force reported that IRM fund releases were "rushed even when the circular implementing the scheme was not yet effective".
Under the IRM, PhilHealth advances funds to healthcare institutions directly hit by fortuitous events.
To help its partner institutions cope with the coronavirus disease 2019 (Covid-19) pandemic, PhilHealth allowed these institutions to apply for IRM funds equivalent to 90 days of benefit claims in 2019.
In its report posted on its website on August 10, 2020, PhilHealth said it has released more than P14.9 billion in IRM funds to healthcare institutions.
The task force report said that the IRM was converted into a special privilege and the circular on its implementation removed the need for prior board approval.
The circular also removed other requirements such as survey and post-survey requirements as well as centralized the evaluation of applications at the Office of the President and CEO.
"IRM fund releases were made despite the absence of mechanisms to monitor fund utilization and liquidation, and without taxes due thereon being withheld," Roque said, still citing the report.
Concealment of documents
The task force also found that members of the executive committee concealed important information or documents to obtain board approval on ICT procurement.
According to the task force, Morales and Aragona submitted a request for the procurement of P734 million worth of ICT items that were neither included in PhilHealth's Information System Strategic Plan (ISSP) nor approved by the Department of Information and Communications Technology (DICT).
The task force report said the executive committee did not present to the board, "upon the instance of PCEO Morales", an internal audit report that showed major discrepancies and inconsistencies in PhilHealth's hardware and software inventory as well as in the appraisal of documents supporting the corporate operating budget for ICT.
The board also approved the procurement of network switches for the PhilHealth regional office in the National Capital Region despite a Commission on Audit (COA) memorandum on the non-utilization of 24 network switches.
Questionable policies
On the adoption of questionable policies and weak enforcement practices, the task force report noted that cases involving fictitious crediting of remittances were settled.
These included cases where contributions were diverted to a private account or payment for a healthcare institution was diverted to an undisclosed account.
The task force also noted that court decisions suspending the operations of six erring healthcare institutions were not implemented and the penalty was changed by the board to mere payment of fines.
"In at least 20 instances, the board also withheld the penalty of suspension and dispensed with the filing of the appropriate legal action in exchange for the payment of fines by the concerned HCIs," the report added.
The task force cited the Senate's findings that less than two-thirds of the 7,452 pending cases against HCIs from 2010 to 2019 were acted upon by PhilHealth while only one-third of the 1,968 cases of fraudulent claims in the same period were decided.
Charges
Because of their negligence, PhilHealth executive officers were found to be criminally and administratively liable under Republic Act No. 3019, or Anti-Graft and Corrupt Practices Act; Revised Penal Code for malversation of public funds or property and the illegal use of public funds and property; and gross misconduct and gross neglect of duty under Civil Service laws.
They may be also be held liable for certain violation of the National Internal Revenue Code in connection with their failure to withhold taxes on IRM releases.
Task Force PhilHealth, which is headed by the Department of Justice, was created by Duterte to investigate PhilHealth transactions and conduct a lifestyle check on its executive officers.
Roque earlier said the task force will have the power to suspend PhilHealth officials, unlike Congress which merely conducts investigations in aid of legislation.
Aside from DOJ, the task force is composed of representatives from the Office of the Ombudsman, Commission on Audit (COA), Civil Service Commission (CSC), Office of the Executive Secretary and Presidential Anti-Corruption Commission (PACC) Undersecretary Jesus Melchor Quitain.
When the group first convened, Justice Secretary Menardo Guevarra ordered members to act on pending cases involving PhilHealth officials, resulting in the suspension of 13 former and incumbent officers. (Marites Villamor-Ilano/VoxPop Philippines)