PhilHealth suspends COVID-19 payments

Philippine Health Insurance Corp. (PhilHealth) on Thursday announced that it was suspending its interim reimbursement mechanism (IRM) for review after several senators called for a halt to payments to hospitals for COVID-19 services amid allegations that the release of funds for the country’s coronavirus response had been marred by irregularities.

In a post on its Twitter account, PhilHealth said the suspension of the reimbursement fund was meant “to review its overall implementation and resolve issues arising from congressional inquiries.”

PhilHealth vowed “to find ways to make IRM more responsive to the needs of health-care facilities affected by the current pandemic to assure patients of continuous access to needed health services.”

‘Complete disaster’

Senators Francis Pangilinan, Panfilo Lacson, Risa Hontiveros, and Senate President Vicente Sotto III on Wednesday said the reimbursements should be stopped while questions about the payments to hospitals remained unanswered.

“The current allocation system is a complete disaster and is a huge stumbling block for our hospitals to be able to effectively address the killer pandemic,” Pangilinan said.

Lacson questioned what appeared to be favoritism in the allocation of funds, including payment to a dialysis center that handled no COVID-19 cases.

Sotto suggested the replacement of the entire PhilHealth leadership with incumbent employees with clean records to eliminate alleged corruption in the state-run health insurer.

The National Bureau of Investigation on Thursday formed a task force to investigate alleged corruption in PhilHealth as several senators questioned the silence of one official on the scandal racking the company—Health Secretary Francisco Duque III.

The NBI task force—composed of officers from the bureau’s graft, fraud, special action, computer crimes, special operations divisions, and digital forensic laboratory—will audit the finances of PhilHealth and conduct lifestyle checks on the company’s officials and employees. President Rodrigo Duterte ordered the investigation last week, putting the Department of Justice at the head of the probe, after the Senate committee of the whole heard testimony that key PhilHealth officials had been bleeding the health insurer since 2013, pocketing up to P15 billion in 2019 alone.

WellMed scandal

Prior to the current scandal, the NBI was investigating PhilHealth for the payment of fraudulent claims for renal replacement therapy involving 13 health-care institutions.

Catherine Camposano-Remigio, chief of the NBI’s graft division, earlier said the probe stemmed from the investigation of WellMed Dialysis and Laboratory Center, which PhilHealth allegedly paid P1.8 million for services to fictitious patients. Twenty-one PhilHealth officials were found negligent in the accreditation of WellMed.

In the current scandal—involving “moneymaking schemes,” including the alleged overpricing of an information technology (IT) project, manipulation of the company’s financial statements and reimbursements for COVID-19 treatment to hospitals that do not handle coronavirus cases—key PhilHealth officials on Wednesday agreed to open their bank accounts for investigation by the Anti-Money Laundering Council (AMLC) and to undergo lifestyle checks.

PhilHealth President and CEO Ricardo Morales, Executive Vice President and COO Arnel de Jesus—both of whom are on sick leave—and Senior Vice President Rodolfo del Rosario have not yet agreed to the AMLC probe and lifestyle check.

Duque, ex-officio chair of PhilHealth, has not said anything in public about the allegations since the scandal broke out last month but he will be summoned to the Senate hearing on Tuesday.

Why is he quiet?

Lacson, who initiated the inquiry along with Sotto, on Thursday said Duque took part in a recent online meeting of PhilHealth officials that turned into a shouting match over the allegedly overpriced IT project but had not spoken publicly about the controversy.

Lacson told the Inquirer in a text message that he would ask Duque “why he has been very quiet in spite of all the [irregularities] being openly discussed with so many unanswered questions involving highly questionable transactions by PhilHealth.”

He said he would also ask Duque about his plans for PhilHealth and his recommendations to President Duterte about the state of affairs in the company.

“For Secretary Duque as the top honcho of PhilHealth, it is only appropriate that he address these queries,” Lacson said.

Lacson described Duque as the “big elephant” in the PhilHealth controversy who was not present in the first two Senate hearings, but said he hoped to see the health chief at next Tuesday’s hearing.

Sen. Sherwin Gatchalian said Duque should have spoken up about the PhilHealth scandal, reported the alleged irregularities to the President, and taken steps to eliminate corruption in the company.

Gatchalian noted that the board has control over the policies and financial aspects of PhilHealth’s operations.

“As the chairman, he should know what is happening and [he should have] reported this to the President,” Gatchalian told reporters in an online interview.

Other Cabinet officials

He also said that while Morales runs the day-to-day affairs of the company, “Duque should demonstrate that he indeed stopped the corruption in PhilHealth.”

“The chairman wields a lot of influence and if he hears about something, he could sound the alarm bells and start an investigation,” Gatchalian added.

He said other members of the PhilHealth board, among whom are Cabinet officials, should also speak up.

The secretaries of finance, social welfare, labor, and budget are ex-officio members of the PhilHealth board.

“[It’s] their fiduciary duty to keep watch over it,” Gatchalian said.

Hontiveros earlier questioned Duque’s silence on the PhilHealth scandal.

She pointed out that Duque served as president of PhilHealth from 2001 to 2005, as its board chair from 2005 to 2009, and as a board member from 2010 to 2017.

From 2017 to the present, Duque is again chair of PhilHealth, she said.

Hontiveros also said that, based on the attendance record, Duque was present at 15 of 18 PhilHealth board meetings last year and was told about the “mafia” operating in the company by former PhilHealth President Roy Ferrer.

“He cannot feign ignorance,” Hontiveros said.

Questioned reimbursement

Meanwhile, Lacson said the release by PhilHealth of P45 million to B. Braun Avitum Dialysis Center Inc. as reimbursement for COVID-19 services remained unjustified even if the company, which did not handle coronavirus cases, was registered with the Securities and Exchange Commission (SEC).

Lacson was responding to a statement by B. Braun explaining that the company was registered with the SEC as B. Braun Medical Supplies Inc., and its subsidiary B. Braun Avitum was originally incorporated as the Philippine Renal Care Inc. before being renamed B. Braun Avitum.

He questioned the reimbursement on Wednesday, saying B. Braun Avitum Dialysis Center Inc. did not handle COVID-19 cases and was not even registered with the SEC.“Nothing can justify the release of funds in the aggregate amount of at least P45 million to B. Braun Avitum Dialysis Center Inc. that has not catered to a single COVID-19 patient and with such record speed, compared to more deserving [health-care institutions], especially government hospitals catering to COVID-19 patients,” Lacson said on Thursday.

He said he stood by the document he had received from the SEC that showed B. Braun Avitum Dialysis Center Inc. was not registered as a corporation.

“Unless they show their documents to the contrary and validated by [the] SEC, I will have to stand by the government agency’s issued document,” he added.

Lacson said he had also read into the Senate records the SEC registration of B. Braun Medical Supplies Inc.

Professionals for PhilHealth

Marikina Rep. Stella Luz Quimbo said President Duterte should let health insurance professionals run PhilHealth instead of appointees who had to learn the ropes after assuming their posts.

“We cannot rely on learning by doing when it comes to managing a social health insurance fund that receives subsidies and premium contributions … [that amount to] close to P100 billion every year,” Quimbo said in a statement on Thursday.

She said PhilHealth should stop using the lack of an IT system as an excuse for its inability to plug leaks due to fraud.

“Elementary analysis of PhilHealth claims data is sufficient to discover fraud. If this does not work, [the] government should begin to consider privatizing the fund management,” Quimbo said.

There was no immediate comment from Malacañang.

When asked about the appointment of an officer in charge at PhilHealth in the absence of Morales, presidential spokesperson Harry Roque said the President did not appoint the PhilHealth president because the company was a government-owned or controlled corporation.

“Even in terms of appointment, he just says, ‘I wish to elect.’ So let us let the process move forward,” Roque said. —REPORTS FROM TINA G. SANTOS, NIKKA VALENZUELA, LEILA B. SALAVERRIA, MELVIN GASCON, AND JULIE M. AURELIO