PhilHealth says reserve fund at risk of drying up by 2021

PhilHealth's reserve fund is at risk of drying up by 2021 if no congressional action will be done to augment it, an official said Tuesday during the third joint congressional oversight committee hearing on national health insurance.

The depleted reserve fund of PhilHealth is blamed on the diversion of P10.6 billion  to the construction of rural health units in 2015.

"I'm disturbed, I'm worried. Kung wala tayong gagawin there will be no PhilHealth funds to speak of in 2021," Senator JV Ejercito said. "It is disturbing. Because of the steep decline, sa 2021 zero, wala na tayong pondo."

Ruben John Basa, PhilHealth executive vice president and chief operating officer, presented during the hearing their fund projections showing the steep decline in their reserve fund.

According to him, Congress in 2015 approved P37 billion for premiums of indigents, low income earners, barangay workers, and senior citizens. However, then-President Benigno Aquino III vetoed the provision and stated that premiums for senior citizens shall be funded through the unprogrammed funds amounting P10.6 billion.

With the veto message as basis, PhilHealth sent billing statements to the Department of Budget and Management for the 2014 and 2015 premiums to be charged against the unprogrammed appropriations of the 2015 General Appropriations Act.

Diversion?

However, then-Health secretary and PhilHealth chai Janette Garin and Philhealth president and chief executive officer Alexander Padilla, in a joint letter, requested DBM to immediately release the P10.6 billion fund for senior citizens  to augment the 2015 health facilities enhancement program.

Basa said the PhilHealth board was not aware of the request to transfer the fund. "The matter was not presented nor approved by the Philhealth board of directors," he said. 

To finance the coverage for senior citizens, PhilHealth used its reserve fund, Basa said.

"With the approval of the Senior Citizens Act, we did not get that particular money so we have to use our reserve funds, so that started the bleeding," said Dr. Anthony Leachon, representative of the Monetary Board in the PhilHealth Board.

Appeal to Congress

To prevent the drying up of PhilHealth reserve fund, the government-owned and -controlled corporation asked Congress to replenish its fund.

"We appeal to Congress particularly the members of the joint oversight committee that we included the P10.6 billion as part of our 2019 general appropriations act proposal and we hope said funding will be included once President Duterte signs the 2019 GAA (General Appropriations Act)," said Basa.

Minerva Cabigting, Commission on Audit assistant director, said the P10.6 billion fund was transferred from the PhilHealth to the Department of Health (DOH).

Because of this, on March 27, PhilHealth filed before the Ombudsman complaints against Garin and Padilla for allegedly diverting the P10.6 billion fund for senior citizens premium to the DOH program, including the construction of health stations in public elementary schools, equipment provision for barangay health stations, and infrastructure upgrading and equipment provision for rural and urban health units.

"The respondents had no authority and basis to make such waiver which is gravely prejudicial to the interest of PhilHealth and senior citizens," the complaint stated.

Garin, Padilla wash hands

Both Garin and Padilla denied the allegations.

"No such diversion. There were claims but were not recognized by the DBM. There were questions on fraud and padded financials. Why spend on unrealized income? Culprits of fraud are looking for a scapegoat on the real reasons behind their disastrous financial situation," Garin said in a text message to GMA News Online.

She said when she assumed the PhilHealth chairmanship, they were able to curb fraud and stop payments to questionable transactions in the way the GOCC was being managed. She said, unfortunately, it was not sustained and abuse of a few were continued.

"An external, credible audit should be done. Many of the resource persons being utilized are compromised," Garin said.

Padilla said he had not been asked to respond in the inquiries conducted by either the Senate or the House of Representatives.

"No money was diverted or stolen, no allegation of corruption, they refer merely to a letter request I made together with the secretary of Health, a mere request made in accordance with law which required no board approval,” he said in a separate text message.

He added senior citizens were never deprived of their benefits.

"If there is allegation of corruption in the building of health facilities, that should be answered by the DOH and Philhealth had nothing to do with the bidding or procurement," Padilla said.  —KBK, GMA News