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Davao City hospital got biggest PhilHealth cash advance

Sotto

PhilHealth inquiry: Senate President Vicente C. Sotto III on Tuesday, August 11, 2020, moves for the resumption of the second hearing of the Committee of the Whole on the Senate resolutions calling for an inquiry in aid of legislation the reported widespread corruption and mismanagement in the PhilHealth. Also in photo are (left) Sen. Francis 鈥淭ol鈥 Tolentino and (right) Sen. Panfilo Lacson. (Joseph Vidal/Senate PRIB)

MANILA, Philippines鈥 Weeks before it approved the guidelines for the use of special funds for the government鈥檚 COVID-19 response, Philippine Health Insurance Corp. (PhilHealth) had already handed out P9.3 billion in cash advances to various hospitals, especially favored health facilities, Sen. Panfilo Lacson disclosed on Tuesday.

At the resumption of the Senate hearing on the corruption scandal hounding the state-run health insurer, PhilHealth officials said a hospital in Davao City was the biggest recipient of funds from the P30-billion Interim Reimbursement Mechanism (IRM).

Southern Philippines Medical Center, a public hospital in President Rodrigo Duterte鈥檚 hometown, received P326 million. The University of the Philippines-Philippine General Hospital in Manila, a major referral hospital for COVID-19 patients, received P262.3 million in advance payment.

Another hospital in Davao region, Davao Regional Medical Center in Tagum City, ranked third, getting P209 million. Lacson, Senate President Vicente Sotto III and other senators pounced on the questionable distribution of the IRM allocations, which were specifically allocated for hospitals treating patients infected with the new coronavirus.

Lacson said a review of PhilHealth records showed a 鈥減attern鈥 that some hospitals, particularly private-owned, were favored in the distribution of IRM over state-owned hospitals. For example, he said Eastern Samar Gov. Ben Evardone had been complaining about the delay in the reimbursement of P24 million in benefit claims of at least 10 district hospitals in the province.

鈥淭here鈥檚 a pattern here. Why is this happening? There seems to be favoritism in choosing鈥 private hospitals receiving IRM funds,鈥 Lacson said.

Sen. Joel Villanueva said the swift release of P45 million in cash advances to B. Braun Avitum Philippines despite the dialysis center鈥檚 pending cases in PhilHealth proved that the health insurer had given preferential treatment to certain health facilities.

鈥淚 don鈥檛 think there鈥檚 any doubt that there鈥檚 favoritism in PhilHealth,鈥 Villanueva said.

鈥淚RM has now become 鈥業nequitable Reimbursement Mechanism.鈥 It鈥檚 being used by PhilHealth to the advantage of some 鈥榖lessed鈥 (hospitals),鈥 he said during the nine-hour hearing.

Lacson said records showed that B. Braun was not even registered with the Securities and Exchange Commission.

鈥淎re you not conducting due diligence? You are releasing millions of pesos,鈥 Lacson said. 鈥淵ou made advance payments to B. Braun, which is charging their patients for dialysis. So where did the money that you gave go?鈥

Thorrsson Montes Keith, who had resigned as PhilHealth antifraud legal officer, said he suspected PhilHealth Senior Vice President Rodolfo del Rosario actually owned B. Braun, based on the deposits made to a rural bank in Balanga, Bataan province, which the PhilHealth official allegedly frequented.

Del Rosario denied owning the dialysis center.

LP bailiwick

Senate Minority Leader Franklin Drilon also lamented that the requests for IRM funds of 33 hospitals in his home region of Western Visayas, regarded as the bailiwick of the opposition Liberal Party, had not been granted by PhilHealth since April 6.

鈥淯p to this point, not a single peso was released to these 33 hospitals,鈥 Drilon said. But Robert Labe Jr., PhilHealth corporate counsel, insisted that all the IRM releases were consistent with PhilHealth鈥檚 existing regulations.

鈥淭he IRM is not provided arbitrarily. There is a process being followed,鈥 he said.

Sotto, who spearheaded the investigation along with Lacson, asked PhilHealth President and CEO Ricardo Morales about the legal basis of the IRM that would justify the distribution of billions of pesos in cash advances to public and private health facilities.

Morales, who joined the hearing via the internet, said Republic Act No. 7875, the law that created PhilHealth, allowed it to 鈥渟upervise the provision of health benefits鈥 and set standards, rules and regulations necessary to ensure quality鈥 of health care in the country.

But Sotto said the concept of 鈥減ayment mechanism鈥 as stated in the law was different from 鈥渇inancial mechanism鈥 that the PhilHealth board cited in creating IRM.

鈥淒oes PhilHealth have the power to finance any (hospital)? That鈥檚 not included in your mandate, right?鈥 Sotto asked the PhilHealth chief. Morales agreed, adding that the corporation鈥檚 authority was to pay for health services.

Anticipating Covid-19

Morales claimed that the PhilHealth board had started discussions on crafting IRM as early as January in anticipation of the effects of COVID-19.

鈥淲e were in the state of anxiety (then) because we knew COVID-19 was coming,鈥 Morales said. 鈥淲e wanted to take preemptive measures to be able to prepare our hospitals to respond to this pandemic.鈥

Lacson and Drilon took Morales to task for claiming that PhilHealth came up with the idea about the IRM in January. Drilon pointed out that Health Secretary Francisco Duque III was telling the public in early March that there was no need for the public to worry.

PhilHealth board member Alejandro Cabading and Dr. Susan Mercado, who recently resigned from the board, denied Morales鈥 statement.

鈥淎s far as I can recall, we were not talking about COVID-19 (that time),鈥 Mercado said, adding that it was not the board that initially allotted P27 billion for IRM.

Replying to Lacson鈥檚 queries, Mercado said the PhilHealth board was just 鈥渋nformed and asked to endorse鈥 PhilHealth Circular No. 2020-0007, which Morales supposedly signed on March 20.

Antedated resolution At the time, Lacson said, official PhilHealth records showed that the company had already released P703 million. Showing another set of documents, the senator said the resolution was 鈥渁ntedated,鈥 as it was finalized only on April 22, or more than a month after the health insurance started disbursing IRM funds.

Lacson said PhilHealth鈥檚 IRM distribution had already ballooned to P9.3 billion by then. Worse, PhilHealth adopted only on March 31 Board Resolution No. 2515, which was needed to justify the March 20 circular, according to the senator.

鈥淪o what were the guidelines (used by) the regional vice presidents in issuing IRM when the guidelines, called the SOP (standard operating procedures), were issued only after (the funds had been distributed)?鈥 Lacson asked.

鈥楽ome expedients鈥

In response, Morales explained: 鈥淚n the administration of our efforts, there were some expedients that had to be adopted because we did not know the possible impact of COVID-19.鈥

鈥淲e had to immediately release the funds. But we made sure that all the releases were covered by a contract and that we would be able to account for all the funds that were (made) available,鈥 he added.

Lacson wondered why the cart came before the horse. 鈥淭he (board) resolution is the one which should pull the cart,鈥 he told Morales.

P1,000 for fake patients

Senate Majority Leader Juan Miguel Zubiri said PhilHealth investigators had informed him that many unscrupulous hospitals were not only involved in 鈥渦pcasing鈥 of treatments, but were also behind the 鈥渘onexistent patients鈥 and rebates schemes.

Zubiri said these hospitals were allegedly paying individuals P1,000 each for 鈥渁cting鈥 as patients, who were entitled to reimbursements from the health insurer. 鈥淪ome (hospitals) pay people P1,000 to act as patients in order to (collect benefit) claims for more serious ailments from PhilHealth,鈥 he said.Phi

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