PhilHealth officials ordered to present SALNs in House probe

By: - Correspondent / @melvingasconINQ
/ 05:32 AM August 06, 2020

MANILA, Philippines — A House of Representatives panel that opened its own investigation of alleged irregularities and corruption in Philippine Health Insurance Corp. (PhilHealth) on Wednesday directed more than a dozen of the state health insurer’s top officials to disclose their assets and net worth as part of a lifestyle check.

“It is critical that we see their SALN (statement of assets, liabilities and net worth) in order for us to see the real situation of PhilHealth,” said Anakalusugan Rep. Michael Defensor, who led the inquiry by the House committee of public accounts.


The move followed a testimony in the Senate’s own inquiry on Tuesday by a former PhilHealth antifraud legal officer who said members of the health insurer’s executive committee were part of a “mafia” or “syndicate” that allegedly made off with P15 billion in company funds.

Lawyer Thorrsson Montes Keith earlier alleged that PhilHealth President Ricardo Morales had become a “coddler” of the syndicate. Morales denied the allegation.


The House panel sought the SALNs of Morales, Senior Vice President and Chief Operating Officer Arnel de Jesus, seven senior vice presidents and nine vice presidents.

House Deputy Minority Leader and Bayan Muna Rep. Carlos Isagani Zarate, one of the authors of a resolution calling for the PhilHealth probe, said a lifestyle check “is really needed in order to exact accountability.”

Case-rate system

At Wednesday’s House hearing, where Morales and other PhilHealth officials participated online, Defensor said the case-rate system was the “root of corrupt activities in PhilHealth” and urged the company to scrap it.

Under the system, PhilHealth sets a fixed amount for each type of illness as payment for claims from members to cover the professional fees of doctors and the use of medical facilities.

The system had been abused by corrupt PhilHealth officials with the alleged collusion of hospitals in exacting excess payments as the actual billing is often less than the fixed amount under the system, Defensor said.

He said scrapping the case-rate system would “kill the syndicate.”

Marikina Rep. Stella Luz Quimbo, who also participated via Zoom, questioned claims of Nerissa Santiago, PhilHealth vice president for actuary, that the company had only P44 billion in actuarial funds. That amount gave it less than a year more to exist.


The Marikina lawmaker cited a statement by Health Secretary Francisco Duque III in 2019 that with its remaining funds, PhilHealth had an actuarial life of about 10 years. “How did it happen that you went from a life span of 10 years to one year in a period of less than a year?” she said.

Santiago said PhilHealth’s actuarial life was based on the agency’s projections.

Quimbo, a health economist, also chided PhilHealth’s estimate of P45 billion in payments for COVID-19 treatments, saying her own “maximum” estimate was only P3.2 billion.

“It is this excessive leeway that provides the opportunity for fraud,” she said.

Lacson: Morales ‘evasive’

Sen. Panfilo Lacson on Wednesday said the “unresponsive and evasive” replies by Morales to questions during Tuesday’s Senate hearing showed that he may have already been “co-opted” by those behind the irregularities in PhilHealth.

During the grueling nine-and-a-half-hour proceedings, the PhilHealth chief was castigated by several senators numerous times when he ordered his subordinates to answer on his behalf instead of directly responding to their questions.

Senate President Vicente Sotto III, who presided over Tuesday’s Senate inquiry, said Morales was possibly “protecting” the members of the PhilHealth executive committee.

“(Morales) was defending them. That was the sad part about it,” Sotto said. “He was protecting something or someone. That’s how I see it.”

“If he stops protecting his (subordinates), then we will be able to dig up the truth,” he added.

Lacson said the PhilHealth chief’s apparent indifference to the irregular procurement projects that the Commission on Audit (COA) had discovered and those that were directly brought to his attention raised suspicions about his credibility.

“His responses were surprising, to say the least,” he said. “They were unresponsive, along with the answers of the other (PhilHealth officials) … They were beating around the bush. They could not answer directly.”

“If I were to give my opinion,” he added, “I think he’s been co-opted particularly by the (executive committee).”

Lacson said another witness, Etrobal Laborte, Morales’ former head executive assistant, had decided not to continue testifying for fear of his life.

Lacson said Laborte, a retired Marine colonel, briefly joined the Senate hearing through the internet.

Laborte, who quit his post last month, had provided senators with documents and other information on the questionable projects and decisions of PhilHealth’s executive committee, such as the botched P2.1-billion information technology project that an internal audit had flagged for overpricing, Lacson said.

Still trusted by Rody

“Laborte knows a lot of things. But he was already withholding [information] even before he decided to testify. If he decided to go all out, he could tell us many things,” Lacson said.

Laborte told members of Lacson’s staff that someone was following him, the senator said.

Presidential spokesperson Harry Roque said Morales would remain at his post until President Duterte had obtained evidence against the PhilHealth chief.

He cited Sen. Bong Go’s statement that Morales still enjoyed the President’s trust and confidence. Go, a former aide of the President, remains close to Mr. Duterte and is often seen with him.

Roque told CNN Philippines that he was hoping the congressional investigations would document the proof that the President wanted to see.

He had been at loggerheads with Morales who seemingly did not take steps to end corruption at PhilHealth.


Roque said he had no evidence that Morales was corrupt. But he said Morales was expected to clean up the agency after his appointment last year in the wake of the controversy over PhilHealth’s payment of fraudulent treatment claims.

“Yesterday, what worried me was he admitted [to the senators] that corruption was still rampant and I did not hear steps that he has taken to remove corruption in the agency. That to me is the most worrisome,” Roque said.

Speaker Alan Peter Cayetano said he was “encouraging both the House and the Senate to be very thorough” in the probe of alleged corruption in PhilHealth “so that we can get to the bottom of it.”

—With reports from Marlon Ramos and Leila B. Salaverria

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