Morales: No reason to doubt people at PhilHealth

Ricardo Morales, president and CEO of the Philippine Health Insurance Corporation (PhilHealth), defended himself and his fellow executives from accusations of corruption, insisting all the evidence presented in a Senate probe can be explained.

Morales and other PhilHealth executives held a virtual media briefing on Thursday afternoon, August 6, to "air their side." They felt "nilaspag" or worn out from the Senate hearing on Tuesday, August 4, that ran for 10 straight hours.

In their own briefing, without inquiring senators to cut them off, the PhilHealth executives offered explanations for the staggering documents and figures that the lawmakers said were evidence of "blatant corruption." (READ: PhilHealth senior exec resigns amid corruption mess)

For example, PhilHealth chief information officer Jovita Aragona reiterated that the 15 CISCO network switches they were proposing to buy for P320,000 apiece were not at all overpriced.

Although whistleblower Etrobal Laborte said each network switch's market price is only P62,424, Aragona said that with warranty, taxes, and other services such as training in their use, the market price for each network switch is actually P419,946.

PhilHealth's other executive committee (execom) officials were also on hand to deny the accusations, including that they pocketed P15 billion in PhilHealth funds, as alleged by the agency's anti-fraud legal officer Thorrsson Montes Keith.

"We can show receipts of the releases from IRM (Interim Reimbursement Mechanism) na hindi 'yan binulsa ng mga execom (to prove they weren't pocketed by execom members)," said Rodolfo del Rosario Jr, PhilHealth senior vice president for legal affairs.

The IRM is a program that advances the reimbursement of members' insurance claims to hospitals and clinics directly hit by "fortuitous events," supposedly cutting the long queue and tedious bureaucratic process. It was one of the controversial items that came out of the Senate probe.

'No reason to doubt people at PhilHealth'

The PhilHealth officials, particularly Morales, had failed to convince the senators. On Wednesday, August 5, Senators Vicente Sotto III and Panfilo Lacson said the corruption in the agency was obvious, and Morales can only be either blindsided or complicit.

Still keeping the nonchalance that had unnerved senators at the probe, Morales on Thursday said that although it's undeniable there is corruption in PhilHealth, the "vast majority" of its officers and workers are "good, devoted, hardworking" people.

"I have no reason to doubt the people working at PhilHealth. No reason," Morales said. When pressed for clarification of this statement, he said he meant his immediate circle of fellow executives and high ranking officials.

But with the sheer size of PhilHealth, Morales is certain there is corruption in it somewhere.

"Hindi puwedeng wala (There can't be none). We have 6,000 employees distributed in 130 offices nationwide, transacting 35,000 claims a day with about 8,500 hospitals and 40,000 healthcare professionals," he said.

As with any national healthcare program, there is fraud, and it's systemic, Morales said. A 2019 study said PhilHealth lost 7.5% of funds to fraud that year, equivalent to some P10 billion.

If not his inner circle, then who is defrauding the agency? PhilHealth fund management chief Renato Limsiaco Jr insisted it's outsiders – the hospitals and medical professionals they deal with.

Morales is not as optimistic. For sure, there are insiders involved, he said.

"But I don't have direct evidence. Tsismis mayroon (There are rumors) but that will not stand in court," the PhilHealth chief said.

This was precisely why he had been pushing for that highly questioned P2.1 billion budget for information and communications technology (ICT), Morales said. It will take a state-of-the-art ICT system to keep track of 35,000 benefit claims daily and make sure they're all legitimate.

"What is P2 billion to an organization bleeding P10 billion a year?" Morales said, defending the budget proposal that was allegedly bloated by about P734 million.

'We can't rely on whistleblowers'

Fighting "systemic corruption" requires systemic means, not renegade employees with shocking claims, he added.

Laborte was Morales’ head executive assistant. Keith was a frontliner against fraud. Both have filed their resignation, effective by the end of August. A third whistleblower, Alejandro Cabading, is a member of PhilHealth's board of directors.

"Whistleblower 'yan. Eh kung wala 'yung whistleblower? (They are whistleblowers. What if there are no whistleblowers?) That's why only an IT system [will do]," Morales said.

"We can't rely on whistleblowers. It's a weak anti-fraud mechanism," he added.

The other PhilHealth executives lashed out at the whistleblowers.

Aragona scored Cabading for having been "too negative" about the proposed IT budget, when many of the other board members had no questions about it.

Del Rosario accused Keith of peddling lies, and said the execom members will sue him for libel even if they had to do it on their own means.

Del Rosario then challenged Laborte, who has begged off from testifying at the Senate probe, to come out of hiding and back his claims.

"Sinisira mo 'yung mga tao. Sinisira mo 'yung mga buhay namin, buhay ng mga pamilya namin. Tapos magtatago ka?" Del Rosario said during the virtual briefing, addressing Laborte. (You're destroying people. You're destroying our lives, our families' lives. Then you go into hiding?)

Morales kept his cool, even when asked about calls for his resignation, and accusations from senators that he's "either stupid or corrupt."

After all that, has he fallen out of favor with President Rodrigo Duterte, who appointed him in 2019 to weed out corruption at PhilHealth?

"So far, the messages that I've been getting is to stay here," said Morales, a retired military general. If he had his way, he would have left long ago, he added.

"You know, there are many good people at PhilHealth, hardworking, well devoted, the better part of their lives [spent] at PhilHealth. In other words, hindi na sila puwedeng umalis sa PhilHealth at lumipat sa ibang agency kasi PhilHealth na 'yung buhay nila eh (they can no longer leave PhilHealth and move to other agencies because PhilHealth has become their life)," Morales said.

"These are the people I would like to protect. I'm staying here because I want to help them," he added. –

JC Gotinga

JC Gotinga often reports about the West Philippine Sea, the communist insurgency, and terrorism as he covers national defense and security for Rappler. He enjoys telling stories about his hometown, Pasig City. JC has worked with Al Jazeera, CNN Philippines, News5, and CBN Asia.