Gatchalian cites 2 main reasons to privatize PhilHealth

The dismal performance of the Philippine Health Insurance Corp. (PhilHealth) and the failure of its officials to stem systemic fraud warrant the privatization of the government’s medical insurance company, Sen. Sherwin “Win” Gatchalian said on Wednesday.

Gatchalian, Senate economic affairs committee vice chair, said PhilHealth was among dozens of government-owned and -controlled corporations (GOCCs) that had consistently failed in the performance evaluation standard of the Governance Commission for GOCCs (GCG) for the past several years.

He said the “biggest scandal in recent memory” happened in PhilHealth, referring to allegations of massive corruption that had led to criminal charges against former PhilHealth president Ricardo Morales and some other officials of the state-run health insurer.

“We are all dismayed that even during the COVID-19 [pandemic], many unscrupulous PhilHealth officials callously pocketed (public funds),” Gatchalian said during the Senate hearing on the GCG’s proposed budget of P198 million for 2021.

“How come PhilHealth was (allowed) to operate this way? Now we’re dealing with the consequences of poor management and corruption inside,” he said.

In wrong people’s hands

“This creates a very good ground for a possibility to privatize PhilHealth. Personally, my own analysis is that its operations can be privatized,” he maintained.

Gatchalian, a scion of a business clan from Valenzuela City, said a company he had worked for when he was still in the private sector had paid a private health insurance provider for the medical benefits of its employees.

“We all know right now that (PhilHealth’s) operation is prone to corruption in the hands of the wrong people,” said Gatchalian, who presided over the hearing.

“But since this operation can be performed by the private sector, why not just give it to the private sector and the government will just pay premium?” the senator said.

GCG Chair Samuel Dagpin Jr. said privatization of PhilHealth was “one of the options” his agency had considered to eradicate various rackets allegedly perpetrated by some of its corrupt officials, but only Congress could decide on that.

Dagpin said the GCG has been pushing for institutional reforms to improve the state-run insurance company’s performance since 2017 when it recommended the transfer of PhilHealth’s administrative supervision from the Department of Health to the Department of Finance.

Senate President Vicente Sotto III, who had exposed the allegedly irregular distribution of P14.9 billion in PhilHealth’s COVID-19 response funds, had already filed a proposed measure to replace the health secretary as PhilHealth board chair with the finance secretary.

“The problem is really in the claims and benefits portion of our health-care system … I think there must be a reformation,” Dagpin said.

“We also have to define what are the basic essential health services to be (covered) by the UHC (universal healthcare) law. That should be properly studied,” he said.

Hope for reform

Asked by Gatchalian whether PhilHealth’s problematic system, which has been blamed for the unabated corruption in the state insurer, could still be rectified, the GCG head said: “There is hope for reform, really.”

“I already mentioned that the claims and benefits portion of the health-care system is the one having problems,” he added.

Dagpin also disclosed that PhilHealth scored less than 50 percent under the GCG’s performance management system in 2019, failing the mandated 90 percent passing rate.

The GCG official said they had submitted their own recommendations to Malacañang and the Department of Justice, which had been directed by President Duterte to lead the investigation into the multibillion-peso corruption scandal that supposedly pushed PhilHealth to the brink of financial collapse.

Last week, the National Bureau of Investigation brought criminal charges against Morales and eight of his subordinates in the Office of the Ombudsman for the alleged misuse of P14.9 billion in interim reimbursement mechanism funds.

The funds specifically allotted for hospitals treating patients infected with the new coronavirus were allegedly given to dozens of health-care facilities that did not even handle a single case of COVID-19.