Whistleblower claims ₱15 billion stolen by PhilHealth execs in fraud schemes

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Officials of the embattled Philippine Health Insurance Corporation have stolen some ₱15 billion from the agency using different fraudulent schemes, a former official claimed Tuesday.

Metro Manila (CNN Philippines, August 4) — Officials of the embattled Philippine Health Insurance Corporation have stolen some ₱15 billion from the agency using different fraudulent schemes, a former official claimed Tuesday.

The state-run agency's former anti-fraud legal officer Thorrsson Montes Keith, who earlier resigned due to "widespread corruption" within the office, alleged that "mafia members" were in charge of what he calls "crime of the year" due to anomalous transactions.

"Naniniwala po ako na ang perang winaldas at ninakaw ay humigit kumulang ₱15 billion," said Keith, testifying before the Senate Committee on the Whole.

[Translation: I believe that the total amount of money spent and pocketed amounted to more or less ₱15 billion.]

"Naniniwala po ako na ang dahilan kung bakit hindi natatapos ang korapsyon sa PhilHealth at naging kultura na po nito, ay ang pagtatalaga ng mga sindikato o mafia ng kanilang kasamahan, kasabwat o kapwa sindikato sa mga matataas na posisyon na nakakatulong sa kanilang iligal operasyon."

[Translation: I also believe that the reason why the culture of corruption continues to proliferate in PhilHealth is due to the delegation of mafia syndicates of additional members who also belong to top positions, which helps prolong illegal operations.]

Keith accused PhilHealth President and CEO Ricardo Morales of also instructing him to talk to Presidential Anti-Corruption Commission Commissioner Greco Belgica to amend a pending case involving the agency's overpriced COVID-19 testing kits.

"Inutusan ako para hilutin ang kaso sa overpriced test kits," Keith bared.

[Translation: He asked me to negotiate on the case involving overpriced test kits.]

The PhilHealth chief later tried to discredit Keith, saying the former official was "vengeful" after being rejected for a position he coveted. Morales cited alleged sexual harassment cases against Keith and his removal from the police force as reasons for not hiring him as his executive assistant.

Morales added that he was doubtful about Keith's fraud allegations since in over nine months Keith had been the anti-fraud legal officer, he failed to submit any report on anomalies in the agency.

Keith claimed that the ₱15 billion covers the unauthorized release of interim reimbursement mechanisms or funds allocated for "fortuitous events" such as the pandemic, to hospitals who have not yet recorded COVID-19 cases. The amount also included the alleged overpriced information technology systems the agency proposed to purchase, he added.

READ: PhilHealth chief in hot water over cash releases to healthcare providers, alleged 'overpriced' testing kits

PhilHealth board member Alejandro Cabading also pointed fingers at several officials for allegedly manipulating operations inside PhilHealth to block corruption probes. He named Atty. Rodolfo del Rosario, now Senior Vice President of the Legal Sector; Corporate Secretary Jonathan Mangaoang; Dennis Mas, SVP for Management Services Sector; and Renato Limsiaco, SVP for the Fund Management Sector.

"Ini-intimidate 'yung mga tao sa loob na mag-i-investigate," said Cabading.

[Translation: The people tasked to investigate were being intimidated.]

Senator Ping Lacson also earlier gave the same names, except for Dr. Israel Pargas, SVP for Health Finance Policy Sector, and tagged them as the officials involved in the long-standing corruption allegations within the agency.

The senator alleged that these officials do not run out of "malevolent schemes to enrich themselves of a deeply-rooted mafia syndicate" manipulating the financial records of PhilHealth despite changes in leadership.

Del Rosario denied his involvement in any "mafia" within the agency, adding that he will take legal action against Cabading if he cannot substantiate his accusation.

Meanwhile, Mas did not directly deny being part of a mafia but maintained that he was not charged by the Ombudsman as claimed by Lacson. Limsiaco denied manipulating PhilHealth's financial statements.

₱10 billion lost in fraud

Morales said even a change of leadership wouldn't change the culture of corruption within the agency. He said over ₱10 billion was potentially lost to fraud last year. He later added that the agency is investigating around 20,000 cases of potential fraud.

He then pointed out that no healthcare system in the world is entirely "fraud-free."

"Corruption was there in the PhilHealth organization before I came in, and may stay if we don't put a proper system in place," the PhilHealth chief said.