SC: PhilHealth disallowances by COA correct

The Supreme Court has upheld the validity of the notices of disallowances issued by the Commission on Audit covering its expenditures for birthday gifts and other benefits granted by the Philippine Health Insurance Corporation’s board to its personnel in 2007 to 2008 amounting to P204.07 million.

In a decision written by Associate Justice Henri Jean Paul Inting, the high court also ruled that the approving and certifying officers of the efficiency gift disallowed under the notice of disallowance dated November 20, 2009, are liable to return the fund amounting to P16.2 million.

The high court ordered the recipients of the efficiency gift to refund the amount they received, “otherwise unjust enrichment on the part of the payee will arise.

“On the other hand, the payees or recipients of the efficiency gift must return the amount they received since it was erroneously given to and received by them,” the high court said.

While called “efficiency gifts”, the high court noted that there was no indication that the disallowed amount was “genuinely” intended as compensation for the services rendered by the recipients.

Other notices of disallowances issued by the COA that the tribunal affirmed included a birthday gift in the amount of P5.97 million; special event, P8.7 million; nominal gift, P29.5 million; education assistance, P49.28 million; project completion benefit, P4.98 million; payment of liability insurance premium for PhilHealth board of directors and officers, P638,000; corporate transition and achievement premium, P81.05 million; and medical mission critical allowance, P7.91 million.

Except for the notice of disallowance on the payment of liability insurance premium, the resident auditor issued all the NDs in question on the ground that their covered benefits were given to the officers and employees of Philhealth without approval from the Office of the President as required under Memorandum Order 20 dated June 2001 and Administrative Order 103 dated August 31, 2004.

Meanwhile, the resident auditor issued the notice of disallowance because the payment of liability insurance premium for PhilHealth directors and officers violated Section 73 of Republic Act 9184 or the Government Procurement Reform Act and Government Procurement Policy Board Resolution 21-05. Rey E. Requejo

On July 12, 2012, the COA-Corporate Government Sector denied the appeals filed by PhilHealth and affirmed all the NDs.

In a decision issued on December 27, 2016, the COA Proper dismissed the petition for review filed by PhilHealth for lack of merit and for late filing.

The COA Proper also declared that the officials of PhilHealth who authorized, approved or certified the grants could not be deemed in good faith since the law required the prior approval of the OP.

In its ruling, the high court sided with the COA that PhilHealth should have observed the policies and guidelines issued by the OP in granting any additional personnel benefits.

Despite its fiscal autonomy, the high court said, the grant of benefits must be in accordance with applicable laws or specifically authorized by a Department of Budget Management issuance.

“Considering that the ruling of the Court on the need for approval from the OP has long been existing, the Court on the need for approval from the OP has long been existing, the Court cannot allow PHIC to feign ignorance to the pronouncement,” the ruling said.

“Given the foregoing, the Court is unconvinced that the officers of PHIC who approved the benefits in question acted in good faith when they approved and granted these benefits.”

The Department of Justice recently launched a massive probe into the alleged multi-billion corruption activities in PhilHealth.

Following its probe, the DOJ-Task Force PhilHealth recommended the filing of criminal and administrative charges against seven officials of the agency for violation of the Anti-Graft and Corrupt Practices Act for their alleged involvement in the multi-billion PhilHealth fund embezzlement.

The task force has also endorsed to the Office of the Ombudsman the recommendation of the Presidential Anti-Corruption Commission to file criminal and administrative charges against 25 other incumbent and former officials of PhilHealth for their alleged involvement in fraudulent membership enrollment and fraudulent benefit claims done at PhilHealth’s Regional Office 1. Rey E. Requejo