COA: PhilHealth ‘overpaid’ hospitals, clinics over P936.65 M

Published October 10, 2020, 6:26 PM

by Ben Rosario

Over P6.88 billion in audit disallowances were incurred by the Philippine Health Insurance Corporation (PhilHealth) for various financial transactions that the Commission on Audit found irregular, disadvantageous to government, or outright fraudulent.

COA, in its 2019 annual audit report for the graft-ridden agency, also revealed that PhilHealth had overpaid hospitals, clinics, and other health care institutions of over P936.65 million for the year in review.

Auditors revealed that pneumonia has been the medical case with the highest overpayment that reached P105.93 million and a difference of 117.67 percent from the actual charges. They stressed that this is “highly unusual.”

Overpayment has been noted to be high for dengue, urinary tract infection, and hypertensive emergency care.

The audit also revealed that employees received financial benefits totalling P198.238 million in 2015 that were not taxed but were instead deducted from the PhilHealth account.

“The Corporation’s payment to this tax deficiency resulted in unjust enrichment on the part of the concerned employees at the Corporation’s expense,” auditors stressed as it noted that uncollected withholding tax from employees totaled P50.016 million.

COA warned that PhilHealth’s failure to collect the tax deficiency from employees may result in audit disallowances.

“As of Dec. 31, 2019, the unsettled audit suspensions, disallowances, and charges of PhilHealth amounted to P84.364 million, P6.880 billion, and P2.420 milliion, respectively,” the audit report Bared.

The largest disallowance was recorded from the PhilHealth head office, with P1.342 billion.  This was followed by the National Capital Region, P599.56 million; Region VI, P542.95 million;  Region III, P542.55 million; and Region X , P471.32 million.

“Full reimbursement of the package rates (All Case Rates or ARC and Z benefits) to various health care institutions (HCI) for 312,577 sampled claims despite the lower member paritents’ hospital charges plus the maximum amount of professional fees resulted in overpayment of P936.653 million,” COA also reported.

This held up PhilHealth from accomplishing its program objective of increasing financial health protection of member-patients “since the HCIs were the ones who benefited more therefrom,” said COA.

For the ACR, excess charges paid for benefit packages reached P933,869,400, with sampled claims taken only from the NCR and Rizal, Caraga, Regions I, VIII, and IX.

Excess charges of P2.783 million were recorded in the NCR and Rizal for Z benefit.

“The existing payment scheme is detrimental to PhilHealth’s interest as the Corporation incurred unnecessary expenses,” COA stated.

Audit examiners lamented that HCIs took advantage of the excess payments while the member-patients were denied full benefits given by PhilHealth.

COA also emphasized that this audit observation is merely a reiteration of previous years’ audit notices that remained unimplemented by the concerned PhilHealth branches.