THE Senate committee of the whole has recommended the filing of criminal and administrative charges against Health Secretary Francisco Duque III, resigned Philippine Health Insurance Corp. (PhilHealth) president and chief executive officer Ricardo Morales, and other officials in connection with alleged irregularities in the state health insurer, Senate President Vicente Sotto III said yesterday.
The committee made public its report yesterday after holding three hearings last month.
The committee recommended charges of malversation of public funds or property, illegal use of public funds, and violation of the Anti-Graft and Corrupt Practices Act against Duque, concurrent PhilHealth board chairman; Morales; Arnel de Jesus, PhilHealth’s executive vice president and chief operating officer; Renato Limsiaco Jr. senior vice president (SVP) for fund management sector; Israel Francis Pargas, SVP for health finance policy sector; and all officials and employees who would be found by the National Bureau of Investigation to have connived with the officials in the anomalous implementation of the interim reimbursement mechanism (IRM), a cash advance program for hospitals handling COVID-19 cases.
A separate administrative charge for gross negligence was also recommended by the committee of the whole against the same officials in connection with the irregular implementation of the IRM.
Criminal charges were also recommended for the PhilHealth officials and employees in connection with the agency’s failure to collect withholding taxes on IRM funds released to hospitals, and paying the Bureau of Internal Revenue advance withholding tax using PhilHealth’s corporate operating budget.
“It has also been established during the hearings that the implementation of IRM is questionable after PhilHealth extended the coverage of the IRM distribution to HCI (health care institutions) beneficiaries which were not included in the objective set forth in the PhilHealth Circular 2020-0007,” Sotto said in his sponsorship speech.
“Moreover, the statement of PCEO Morales that IRM became COVID-19 specific was made only sometime in May when the continuous implementation of this IRM became untenable for lack of funds,” he added.
The committee of the whole specifically recommended the filing of malversation of public funds or property, violation of the National Internal Revenue Code, violation of the Anti-Graft and Corrupt Practices Act.
Separate criminal charges for violation of Article 208 of the Revised Penal Code: prosecution of offenses, negligence and tolerance; and violation of the Anti-Graft and Corrupt Practice Act were also recommended against lawyer Rodolfo del Rosario, resigned SVP for legal sector “who connived with and participated in the consummation of the punishment/illegal act, particularly for their failure to act upon and/or neglect of duty to cause the prosecution of cases before them.”
Del Rosario resigned last week. He is accused of being a part of an alleged mafia at PhilHealth, which has defrauded the agency of billions in funds.
IT SECTOR
The committee also recommended charges for Jovita Aragona, SVP for information management sector; and Calixto Gabuya Jr., acting senior manager of the IT and management department; and other PhilHealth officer and employees. The charges are falsification by public officer, employee or notary or ecclesiastic minister; fraud against public treasury; removal, concealment or destruction of documents; violation of the Anti Graft and Corrupt Practices Act; and violation of the Government Procurement Reform Act in connection with the overpriced purchase of IT equipment.
In addition to the criminal charges recommended, the committee also said that administrative charges must be filed against Morales and Dennis Mas, SVP for management service sector, for “not implementing the board resolutions on courtesy resignations, which is clearly a neglect of duty and insubordination.”
Also, the committee recommended administrative cases against Morales and De Jesus for violating Commission on Audit rules on the period of liquidation of the disbursed IRM funds, while another administrative case against Del Rosario was recommended for his failure to act on cases pending in their department.
“Ensure that administrative and criminal cases are timely filed against responsible individuals, health care institutions, and corporations. Filing charges against responsible individuals, health care institutions, and corporations will prove PhilHealth’s and the government’s commitment to ensure that government funds are not mismanaged and that corruption is not tolerated. Further, cases and subsequent convictions will serve as a deterrence for others with corrupt intentions,” Sotto said.
FUND LIQUIDATION
To improve PhilHealth services, the committee recommended that all health care institutions (HCIs) be required to liquidate and return unused IRM funds; for PhilHealth to immediately pay the claims of private hospitals giving priority to COVID-19 referral hospitals and those with high COVI-19 admissions; to increase COA involvement in every PhilHealth operation; and outsource IT service of PhilHealth, among others.
The committee also asked the Anti-Money Laundering Council to determine whether the bank accounts of those PhilHealth officials and private entities implicated in the malversation of PhilHealth funds fall within the category of the so-called suspicious accounts.
The anomalies in PhilHealth were unearthed after two officers and a board member disclosed these to the public.
Thorrson Montes Keith, resigned anti-fraud legal officer, tagged Duque as the “godfather” of the PhilHealth mafia which the health secretary denied.
Last week, Sen. Richard Gordon, Senate Blue Ribbon Committee chairman, made public a chairman’s report which contained the findings and recommendations on the hearing on PhilHealth anomalies conducted last year.
Among the recommendations were to file criminal charges against former Health Secretary Janet Garin, former Budget Secretary Florencio Abad, and former PhilHealth head Alex Padilla for allegedly diverting at least P10 billion PhilHealth funds for barangay health projects.
Garin, Abad, and Padilla denied the accusations.
Gordon also tagged all of PhilHealth’s regional vice presidents as members of the state insurer’s mafia, an accusation also denied by the RVPs.
