Improved PhilHealth systems to avert fraud in reimbursements

Column-Dr Anthony Leachon photoPreventive Health Education

By Anthony C. Leachon, MD

WE need to rebuild the PhilHealth to make it more relevant to the needs of the Filipinos. With the huge sin tax funds added to PhilHealth coffers, we deserve a better system. I have not seen the full force of the law being used on this matter. People are waiting.

Republic Act No. 10351 (or the Tobacco and Alcohol Tax), signed by President Aquino on December 29, 2012, gives the government the financial capacity to cover the full subsidy of the premium coverage of 14.7 million poor Filipino families (or more than 45 million Filipinos) amounting to PhP 37 billion for 2015. This also led to an increase of the Department of Health (DOH) budget to PhP 103 billion, an increase never received before.

It would be a total waste of the Sin Tax law signed by PNoy if the earmarked funds to health will not be managed and spent well. If the anomaly is not probed and addressed as soon as possible, it will eventually erode public trust on PhilHealth where Sin Tax funds are being allocated. Irregularities should have been detected early on and the payments should have been suspended or disallowed. The problem may be traced to the failure of the government to establish a blue print or environment of integrity, professionalism, and love of country.

We call for improved mechanisms within the PhilHealth system to avert fraud in reimbursements from happening again. We are proposing comprehensive computerization and building of information technology infrastructure to monitor the benefits and claims of PhilHealth members.

The case of erring doctors has to be addressed as soon as possible. Fraud of this nature is a group crime. For as long as the regulatory, justice and penal systems are weak and unpredictable, and the internal controls are leaky and static, collusion will thrive. Even in mature and rock solid corporations, fraud is a hard reality whether at the clerk level or at the board room. The difference is that there are strong deterrent forces that minimize its occurrence so that crime is minimized to its negligible scale and a financial write off is a good option.

The PCP Foundation urges the Professional Regulations Commission (PRC) to step in to penalize erring doctors, and revoke their licenses, if deemed necessary.

It should not happen with just a deviant eye medical doctor. Education is vital to disseminate information on professionalism and moral values knowledge of Hippocratic oath exists, but we fail to apply it correctly. The regulatory agency should proactively flex its big muscles to preserve the integrity of the profession.

The Governance Commission for Government-Owned or Controlled Corporations (GCG) takes care of the performance oversight of PhilHealth.

Another report found the PhP 1.7 billion in bonuses and allowances of PhilHealth officials that were not approved by the Office of the President and was disallowed by the COA.

It would have been more prudent for PhilHealth not to have allotted such a big amount for the officials and employees to prove that they really cared about the funds being used appropriately for the programs targeting the poorest of the poor.

The external audit is the first big step but the government should seriously look into systems, processes, and controls that will prevent rather after-the-fact or interventional actions.

PhilHealth brought down the remuneration for cataract operations, even caesarian section, with the intention of making it a less attractive option for practitioners. But the more enterprising elements changed their strategy. They accepted the low rates but they compensated with the volume of patients.

Other countries shifted to case rate payment scheme, and they led to similar results – admissions increased.

The DOH and PhilHealth were saying fraud will be minimized with the case rate payment scheme. However, they are now admitting that within one to two years of its implementation, they are now dealing with billions having been paid to facilities and practitioners.

I ask this question to PhilHealth: Why did they not foresee this coming when world literature was available to them? What was the result of their literature search, pilot-testing, actuarial, demographic studies?

Reports on fraud indicated that claims were subsequently paid faster but with it came a bigger problem: The lack of detailed evaluation of the claims.

If they had a rule that solicitation of patients was prohibited, then the first data that should have been checked was how patients got to the hospital. But admittedly, this was relatively difficult to validate. So, PhilHealth paid first, and investigated later. With the discovery of the hakot (crowd-gathering) system, they are now trying to recover what has been paid to facilities and practitioners, which is also a difficult thing to do. Now, it must decide on what kind of intervention it will implement to remedy the gaps/weaknesses it has identified.

The DOH and PhilHealth announced the probe for the scam and were quoted they were doing it because they are the custodians of the public funds of PhilHealth. However, I think the probe is also dealing with problems inside the corporation.

There’s a report that a syndicate composed of PhilHealth insiders in 2009-2011, siphoned off about PhP 100 million contribution/premium from a company, by making it appear that the amount was received but the checks were exchanged for cash in Metrobank.

PhilHealth should adopt the Total Quality Management (TQM) Principle: When a problem is identified, don’t just look at a single component, look at the whole system.

Vital Signs Issue 81 Vol. 4, November 1-30 2015