Liable for 'negligence': Why task force recommended filing raps vs PhilHealth officers

Mike Navallo, ABS-CBN News

Posted at Sep 15 2020 01:48 PM

Health chief Duque not included

Liable for 'negligence': Why task force recommended filing raps vs PhilHealth officers 1
Former PhilHealth president and CEO Ricardo Morales appears at a Senate Hearing on allegedly fraudulent medical claims at PhilHealth, in Pasay City on August 14, 2019. Jonathan Cellona, ABS-CBN News/File

MANILA – An inter-agency task force led by the Department of Justice found several key officers of Philippine Health Insurance Corp (PhilHealth) criminally and administratively liable over their alleged negligence of irregular fund disbursements at the state health insurer.

This, according to a fresh press statement issued Tuesday after President Rodrigo Duterte initially disclosed Monday night the task force’s recommendations to file charges against them.

“The Task Force concluded that the totality of the evidence ‘supports the reasonable conclusion that wrongful acts or omissions on the part of certain key corporate officers of PhilHealth have been committed,’” it said.

Those facing raps are:

  • Former President/Chief Executive Officer Ricardo Morales
  • Executive Vice President/Chief Operating Officer Arnel De Jesus
  • Senior Vice President Jovita Aragona
  • SVP Renato Limsiaco, Jr.
  • SVP Israel Francis Pargas
  • OIC Calixto Gabuya Jr.
  • Division Chief Bobby Crisostomo

Their liabilities include alleged violations of the Anti-Graft and Corrupt Practices Act (RA 3019); the Revised Penal Code's provisions on malversation of public funds or property and illegal use of public funds or property; and civil service provisions on gross misconduct and gross neglect of duty, among others.

In its 177-page report, the task force found that executive committee members rushed the implementation of the interim reimbursement mechanism (IRM), which provides cash advances to hospitals and health care institutions in unforeseen events, even before the circular implementing it could take effect. The panel found it was also enforced without sufficient guidelines and monitoring.

The task force also found that some members of the executive committee concealed important information and audit documents to obtain the PhilHealth Board’s approval of their requested budget.

In one case, a request for a budget of more than P730 million was made despite a requirement under the law that it should be included in the corporation’s Information System Strategic Plan.

In two other cases, they did not present to the board an internal audit report showing discrepancies in the inventory of hardware and software, and PhilHealth NCR procured a network switch contrary to the instructions in a Commission on Audit memorandum.

The task force also faulted PhilHealth’s questionable policies and weak enforcement practices when it comes to checking, probing, prosecuting and penalizing wrongdoing.

It noted instances where PhilHealth did not file cases against those involved in fictitious crediting of remittances and at least 20 times when the company imposed fines instead of suspension on erring health care institutions.

The task force also said that the failure to withhold taxes constitutes a violation of the National Internal Revenue Code on the part of PhilHealth as a corporation. 

Liable for 'negligence': Why task force recommended filing raps vs PhilHealth officers 2
Health Secretary Francisco Duque III attends an event in Quezon City on Aug. 29, 2020. George Calvelo, ABS-CBN News/File

 Health Secretary Francisco Duque III was not among those found liable. This, even while the Senate Committee of the Whole earlier recommended that Duque, alongside other PhilHealth officials, be charged for alleged involvement in anomalies at the agency after a separate investigation. 

The President had earlier said he still has trust in Duque.

Justice Secretary Menardo Guevarra said the report disclosed only initial findings.

“Further investigations will be conducted and more people may be charged,” he explained. 

There were also no details as to why Senior Vice President for legal Rodolfo del Rosario is not included in the list.

He resigned on Aug. 24, the same day he talked to the task force about the management of legal cases, revealing that only 11 cases have been filed despite endorsing 5,000 cases to the regions.

The Senate report had cited him for "negligence and tolerance" of anomalies in PhilHealth over his "failure to act upon the prosecution of cases" at the agency. 

The DOJ did not provide the media a copy of the full 117-page report, citing sensitivity of ongoing investigations.

“We cannot issue the report because it contains information on the ongoing investigations by member-agencies,” said Justice spokesperson Undersecretary Markk Perete.


Liable for 'negligence': Why task force recommended filing raps vs PhilHealth officers 3
President Rodrigo Duterte addresses the public after holding a meeting with the Inter-Agency Task Force on the Emerging Infectious Diseases (IATF-EID) core members at the Malago Clubhouse in Malacañang on Sept. 14, 2020. Ace Morandante, Presidential Photo

Perete, meanwhile, clarified Tuesday that what the President approved were the recommendations of the task force for the filing of criminal “complaints” against key officers of PhilHealth.

Duterte used the term “trial in court” in his speech while Presidential Spokesperson Harry Roque enumerated the names of those who will be “charged” criminally and administratively.

Perete said the complaints would still go through preliminary investigation, the last step before the filing of cases in court.

“Filing either with Office of the Ombudsman (for the administrative or criminal complaints) or with prosecutors (for criminal complaints) and with the PhilHealth (for administrative complaints), depending on the crime committed and/or the rank of the respondent,” he said.

Under the law, graft complaints against executive officials occupying positions of regional director and higher or classified as salary grade 27 and up – including the presidents, directors or trustees or managers of government-owned and controlled corporations – will have to be filed with the Office of the Ombudsman since these cases fall within the jurisdiction of the Sandiganbayan.


Perete further allayed concerns of possible conflict should the complaint be filed with the Office of the Ombudsman since it is also part of the task force.

“Fact-finding lang ang ginawa ng DOJ (the DOJ only did fact-finding). Prosecutors where any complaint is filed are duty-bound to independently and objectively assess and evaluate the evidence that will be presented in their determination of the existence or non-existence of probable cause,” he said.