Plunder, malversation complaints filed vs Recto, Ledesma over PhilHealth funds

A coalition of doctors, health advocates, lawyers, and PhilHealth members filed Thursday complaints against former Finance chief now Executive Secretary Ralph Recto and former PhilHealth president and chief executive officer Emmanuel Ledesma Jr. over the transfer of P60 billion worth of excess PhilHealth funds to National Treasury.

Complaints for plunder, technical malversation, graft, and other related administrative complaints were filed with the Office of the Ombudsman. 

"The transfer caused substantial prejudice to PhilHealth and its members, including estimated lost interest income exceeding P50 million that could have been used to enhance benefits and ease member contributions," the complainants said in a statement. 

In December 2025, the Supreme Court ordered the government to return the P60 billion excess funds back to PhilHealth through the 2026 General Appropriations Act (GAA).

In a 136-page decision, the SC En Banc declared void the Special Provision 1(d), Chapter XLIII of the 2024 GAA, Finance Circular No. 003-2024, and the transfer of the P60 billion for having been issued with grave abuse of discretion amounting to lack or excess of jurisdiction.

The Special Provision 1(d) authorized the return of the excess funds of government-owned or controlled corporations to the national treasury while the DOF circular directed the transfer of P89.9 billion from PhilHealth to the national treasury.

PhilHealth already remitted P60 billion before the SC issued a temporary restraining order to halt the transfer of the remaining P29.9 billion.

"Regardless if they spent the transferred money or not, the transfer violated our laws," lawyer Rodel Taton, one of the complainants, told reporters.

Taton said these laws include: the National Health Insurance Act of 1995, the Universal Health Care Act (UHCA), and Sin Tax law.

Specifically, the complainants said the December 2025 SC decision stated that the Special Provision 1(d) of the 2024 national budget violates the Sin Tax Law which earmark certain percentages of excise taxes on sweetened beverages, alcohol, and tobacco products exclusively for the Universal Healthcare Act.

“Despite the express prohibition of RA 7875 (National Health Insurance Act), as amended, and RA 11223 (Universal Health Care Act), Hon. Ralph Recto caused the inclusion of PhilHealth reserve funds in the GOCC (Government Owned and Controlled Corporation) excess funds through Special Provision Section 1(d) of the 2024 General Appropriations Act. Emmanuel R. Ledesma, Jr., President and Chief Executive Officer of PhilHealth from 2022 until 4 February 2025, should also be  held liable for his acquiescence to the directive given by respondent Recto,” the complaint read.

The complainants also alleged that Recto and Ledesma caused PhilHealth to lose more than P50 million off interest from income generating investment instruments.

“Assuming arguendo that the P60 billion was deposited in banks at 1% interest rate, PhilHealth and its contributing members have lost so much which has a direct impact on the latter’s benefits,” the complaint read.

The complainants argue that the P50 million requirement under the law is roughly around .083% of P60 billion which is way below the possible interest earned if the P60 billion was deposited in banks which gives at least 1% interest rate at the minimum.

“This [complaint] is for universal healthcare and for every Filipino who is unable…who can’t afford to go to the hospital. PhilHealth even has a lot of unpaid dues to government hospitals, and these government hospitals are not enough to serve 100 million Filipinos,” Taton stressed.

“These amounts of [PhilHealth] money could have benefited those people in need as provided under the law. This is [about] accountability. The public interest should prevail,” he added.

In a press statement, Recto said he respects the right of any individual or group to seek legal remedies and to avail themselves of the processes provided under our laws in connection with this issue,

He pointed out that the matter has already been addressed by the Supreme Court, and the government has fully complied with its ruling. 

''Consistent with this, funding for PhilHealth has since been restored and even augmented in order to better serve our countrymen,'' Recto said.

''Let me also reiterate my innocence, as opined by Supreme Court Justices, that no criminal liability may attach to me, as former Secretary of Finance, for acting in good faith and in accordance with a direct mandate from Congress in ordering the remittance of PhilHealth’s unused funds,'' he added.

Recto vowed that he would continue to uphold the rule of law, respect due process, and work to uplift the lives of our kababayan. 

''I will not get distracted by political noise. The work of improving government performance and services is my priority,'' he said.

Ombudsman Jesus Crispin Remulla, for his part, said the complaint is subject for evaluation.

“We will look at the allegations to see if they are actionable. Of course, if it merits any further action... if we find it to be properly done and the legal basis to be solid, then we will proceed [with prosecution],” Remulla told reporters.

GMA News Online reached out to Ledesma for comment and will publish it once available. —with a report from Anna Felicia Bajo/AOL/RF, GMA Integrated News