Senate panel recommends raps vs. ex-PhilHealth chief Morales, Duque

Resigned PhilHealth chief Ricardo Morales and Health Secretary Francisco Duque III are among those recommended by the Senate Committee of the Whole on Tuesday to face criminal charges over alleged irregularities in the state health insurer.

Senate President Vicente Sotto III, in his sponsorship speech, said Duque, who chairs the Philhealth Board, and Morales violated Articles 217 and 220 of the Revised Penal Code and the Anti-Graft and Corrupt Practices Act for alleged malversation of public funds in their "improper and illegal implementation of the Interim Reimbursement Mechanism (IRM)," or the cash advances to health care institutions.

Also implicated for the same offenses were PhilHealth executive vice president and chief operating officer Arnel De Jesus, senior vice president for fund management sector Renato Limsiaco Jr., and senior vice president for health finance policy sector Israel Pargas.

The five of them also allegedly violated the National Internal Revenue Code and Republic Act 1051 for failure to withhold the taxes in the advancement of funds through the IRM to health care institutions and for their act of charging the obligations to the Corporate Operating Budget after failing to withhold the taxes, according to Sotto.

Sotto emphasized that the IRM implementation does not have any legal justification as the Board Resolution concerning it was belatedly adopted on March 31, 2020, while the Circular 2020-0007 was implemented on March 20, 2020.

This can be considered an “ultra vires” act of the corporation, he added.

Further, Sotto said the late submission of the circular to the UP Law Center's Office of National Administrative Register (ONAR) renders a total of P14 billion IRM releases of PhilHealth from March 25 to June 9, 2020 "illegal and invalid."

"Article VII of the Circular clearly states that 'This Circular shall take effect immediately from its publication in a newspaper of general circulation and three certified true copies had been furnished the Office of National Administrative Register (ONAR) of the UP Law Center... Upon the request of the Office of Senator Lacson, ONAR of the UP Law Center issued a Certification that PhilHealth Circular 2020-0007 was filed on June 11, 2020," he said.

At a House hearing last month, now-resigned PhilHealth senior vice president for legal sector Rodolfo Del Rosario Jr. acknowledged that the release of advance payment claims to hospitals before June 11 was illegal.

There were also no concrete guidelines on the liquidation of the IRM, according to Sotto. "It would appear that PhilHealth still has no guidelines for a reconciliation program or a workable mechanism to recover the millions advanced to health care institutions," he said.

PhilHealth was urged to immediately require and set a deadline for the IRM beneficiary institutions to liquidate their utilized IRM funds and to return the unutilized amount.

The state health insurer has already suspended IRM's implementation amid the controversy.

The Committee of the Whole report also recommended the filing of charges against Del Rosario for supposed neglect of duty to cause the prosecution of cases lodged before the department at PhilHealth.

He allegedly violated Article 208 of the Revised Penal Code with regards to negligence and tolerance and the Anti-Graft and Corrupt Practices Act.

PhilHealth senior vice president for information management sector Jovita Aragona, and Information Technology and Management Department acting senior manager Calixto Gabuya Jr. were implicated in the supposed overpricing of IT supply and the concealment or alteration of documents.

The two admitted to "not telling the whole truth" during one of the hearings after they were threatened to be cited in contempt by Senator Panfilo Lacson.

The panel recommended that they be slapped with charges for violation of the Articles 171, 213, and 226 of the Revised Penal Code, Anti-Graft and Corrupt Practices Act, and the Government Procurement Reform Act.

All other officials and employees who have participated in the consummation of these "illegal acts" shall also be punished by law, according to Sotto.

Admin charges

Aside from the criminal charges, the Committee of the Whole also recommended that administrative ones be filed by the Department of Justice and the Ombudsman to the following:

• Morales and senior vice president for management sector Dennis Mas - for not implementing the Board Resolutions on courtesy resignations
• Morales and De Jesus - for violating the Commission on Audit Rules on the period of liquidation in issuing Memorandum Circular 2020-032
• Del Rosario and all the other officers and employees of PhilHealth's Protest and Appeal Review Department - for failure to act and gross neglect of duties relative to the cases pending in their department
• Aside from them, the timely filing of cases against erring individuals, health care institutions, and corporations must be done, according to Sotto.

"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," he said.

The Senate hearings conducted this month revolved around issues involving the questionable implementation of the IRM, the alleged overpriced IT equipment, supposed manipulation of financial  statements, and legal cases that were left to gather dust.

An inter-agency task force conducting a parallel investigation on alleged PhilHealth anomalies targets to submit its report to President Rodrigo Duterte by September 14. —KBK/BM, GMA News