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Group seeks resignation of PhilHealth’s IT executives

The Volunteers Against Crime and Corruption demanded the resignation of the chief technical officer and the chief information officer of state-run Philippine Health Insurance Corp. for what it alleged as “apparent criminal negligence that enabled scammers to raid its coffers.”

VACC president Arsenio Evangelista said the financial scandals that hounded PhilHealth stemmed from the agency’s failure to institute appropriate software systems, business process rules, centralized patient health management records and risk management engines that would have prevented  “ghost” kidney treatments and billings.

Evangelista said that Dr. Madeleine Valera, then Philhealth vice president for health finance policy, testified in a 2007 congressional hearing that since 1995 Philhealth had lost as much as P4 billion due to fraudulent claims.

“Submissions of fraudulent claims are, therefore, nothing new to PhilHealth. The revelations on the P4  billion fraudulent congressional hearings were made in 2007. It is now 2019. The failure of the IT managers at PhilHealth to put in place the necessary computer software and programs that prevent fraudulent claims make the CTO and CIO complicit to the criminal acts of unscrupulous medical providers like WellMed Dialysis Center,” Evangelista said.

Evangelista said the IT officials of PhilHealth, particularly the CTO and CIO, should be held liable for what he alleged as nonfeasance, malfeasance and criminal neglect “for their failure to put in place a fraud resilient and automated healthcare processing.”

He said a fraud-resilient system would have prevented processing and payment of fake benefit claims that were “obviously carried out through collusions between greedy hospitals and medical professionals on one hand and unscrupulous PhilHealth personnel on the other hand.”

“These rip-offs could have been averted if the CTO and the CIO of PhilHealth had put in place a robust claims processing software engine and healthcare management system that spots and stops fraudulent transactions, and these two PhilHealth officials are primarily responsible for the mess,” Evangelista said.

He said the PhilHealth Law stated that the government agency should be run like a private company, in order to make it more responsive to the health insurance needs of the Filipino people, and that PhilHealth officials should follow and emulate the practice in the private sector if financial losses were suffered under their watch as members of the management team.

“In the private sector, the CTO and CIO automatically tender their respective resignations if their computer systems are breached by hackers. This is exactly what has been happening through the years―the PhilHealth computer processing  system was being ‘hacked’ by unscrupulous healthcare providers and conniving PhilHealth  employees in order to process fake and fraudulent claims,” Evangelista said. “The CTO and CIO must therefore tender their courtesy resignations in order to allow the incoming PhilHealth president to appoint his IT experts to correct the obviously flawed claims processing system that has been put in place by these two PhilHealth officials,” he said.

He said the respective heads of the corporation’s technology and information departments were also liable for criminal neglect tantamount to what he called “virtual complicity in the irregularities.” 

Evangelista said PhilHealth was flagged last year for disbursement of P12.69 billion in hospitalization bills for members purportedly stricken with pneumonia. This translated to an incredible 810,000 patients having been hospitalized for pneumonia in 2018.

The figure suggested there was an outbreak of the lung ailment, but there was no declaration of such an epidemic by the Department of Health.

Experts traced PhilHealth’s financial troubles to its allegedly flawed All Case Rates payment scheme that was introduced in 2011, guaranteeing definite amounts in benefit claims for hospitalization or surgery among the agency’s estimated 85 million members.

Topics: Volunteers Against Crime and Corruption , Philippine Health Insurance Corp. , Philhealth
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