PhilHealth should be careful in utilizing funds — SC

The Philippine Health Insurance Corporation (PhilHealth) should be more careful in utilizing its funds for the salaries of its employees as its mandate is to ensure the availability of funds to provide healthcare to all Filipinos, according to the Supreme Court (SC).

The High Court issued the remark in a 16-page decision as it upheld the notice of disallowance (NDs) issued by state auditors on PhilHealth’s grant of new allowances for its employees amounting to P43 million without the approval of then President Gloria Macapagal-Arroyo in 2010.

“As the manager of the State's National Health Insurance Fund, [PhilHealth] must ensure the availability of funds and must carry out its fiduciary responsibility through effective stewardship, proper management, and maintenance of reserves,” it said.

“Hence, it is only proper if not imperative, for [PhilHealth] to be more circumspect in utilizing the funds for the salaries and allowances of its employees. After all, the mandate of [PhilHealth] is to ensure the availability of funds, which it holds in trust to be devoted to providing universal and affordable health care to all Filipinos,” it added.

The Court denied the petition filed by PhilHealth which seeks to set aside COA’s ruling that denied the former's petition for review on the NDs for lack of merit. 

In its petition before the SC, PhilHealth said that it was granted fiscal independence under Republic Act 7875 or the National Health Insurance Act of 1995, which created the agency.

Meanwhile, PhilHealth also argued that its authority under Section 16(n) was confirmed by Arroyo in her letter to former secretary Francisco Duque III and Duque’s letter to Arroyo which sought the confirmation of the approval of the PhilHealth Rationalization Plan.

PhilHealth said that the confirmation given by Arroyo in the two letters is tantamount to presidential approval for the disbursed benefits and recognition of the agency’s authority and independence.

However, the SC said it found the argument to be untenable. 

According to the Court, the issue on PhilHealth’s fiscal independence has been settled in the case of PhilHealth v. Coa where it said that Section 16(n) does not give PhilHealth unbridled authority to fix the compensation of its employees and unilaterally provide allowances.

“Simply put, the Court has consistently ruled that the fiscal autonomy provision under [PhilHealth’s] charter is not without limitations and should be read in conjunction with applicable laws and regulations,” it said. 

Due to this, the Court ruled that state auditors did not commit grave abuse of discretion when it dismissed the agency’s petition for review.

The decision was promulgated in February 2024 but published on the SC website only in June.

GMA News Online sought comment from PhilHealth but has yet to receive a response as of posting time.—AOL, GMA Integrated News