Updated IT system to solve systemic fraud in PhilHealth: Morales

According to Morales, a study conducted last year estimated that PhilHealth’s fraud index was 7.5 percent, as compared with the global average for healthcare fraud of 10 to 20 percent. (File Photo: Philippine Health Insurance Corporation/Facebook)

MANILA – Philippine Health Insurance Corp. (PhilHealth) president and chief executive officer Ricardo Morales on Tuesday said the agency’s alleged “overpriced” information and communications technology system it plans to establish is the solution in dealing with the systemic fraud that is causing the agency to lose billions of pesos a year.

“The problem of fraud and inefficiencies in PhilHealth are here before, long before I got here and will continue to be here long after I am gone if the right things are not done… And right now, at this moment, the right thing to do for PhilHealth is to get the integrated and harmonized information system, and to clean up its membership database,” he told the Senate Committee of the Whole inquiring into the alleged rampant corruption, incompetence and inefficiency in the agency.

According to Morales, a study conducted last year estimated that PhilHealth’s fraud index was 7.5 percent, as compared with the global average for healthcare fraud of 10 to 20 percent.

Nevertheless, at that rate, he said that of the PHP136 billion it spent last year on benefit payments, PHP10.2 billion was potentially lost to fraud.

“This 7.5 fraud index is the mother, the strategic level on which management wishes to focus. But the resources of the corporation are limited and the priorities have to be established,” Morales said.

He maintained that the solution to the systematic fraud problem “lies in the robust, integrated and harmonized information management system running a clean, complete and updated membership database.”

“Only such a system can keep track of the 109 million members, the 40,000 accredited health care professionals, the 8,500 health care facilities filing 35,000 claims a day and paying PHP2 billion a week,” he added.

Currently, he said what PhilHealth has is a “fragmented, aging and over-extended” information system running a hundred applications, a database that handles 370 transactions per second, catering to 4,000 internal and 20,000 external users distributed among its 130 offices and branches nationwide.

“If a corporation stands to lose tens of billions a year through fraud which can be avoided by information technology, then the alleged overpriced PHP2.1 billion IT program over three years appears paltry indeed,” Morales said.

Morales also said he and the management team he created are not yet ready to “throw in the towel.”

“Reform does not happen overnight and some stability is required for it to take root,” he said.

He added that while PhilHealth is not perfect, any “premature and negative publicity” hurled against it inadvertently hurt the interest of its members also.

“Marami pong dapat ayusin sa PhilHealth (A lot of things need to be fixed at PhilHealth). It needs help. It has taken too many body blows. Tulungan po natin ang PhilHealth. Kung maaari po, huwag pagtulungan (Let us help PhilHealth. If possible, don’t gang up on it),” he said. “If this cycle continues, this body might have to make that fateful decision on whether to pull the plug on this organization. Until that happens, this management will pursue what it believes to be the right thing to do.”

Beside PhilHealth’s alleged overpriced information and communications technology equipment, the Senate Committee of the Whole would also look into the alleged manipulation of the agency’s financial statements, and the highly irregular implementation of advanced payments to health care institutions through the Interim Reimbursement Mechanism (IRM) policy, among others.