This photo taken on 12 August, 2020, shows a group of jeepney drivers with placards strapped on their bodies begging for alms in Manila. (AFP Photo)

Corruption in the Philippines is not something novel as the coronavirus that is plaguing the country and the world at large. It is rather an endemic, deep-seated, and deep-rooted virus that has afflicted the country since time immemorial. It is a social menace and a mammoth stumbling block to good governance that had penetrated not just the government but even the private and non-government sectors as well as Philippine society even before the outbreak of the COVID-19 crisis in the country

In as far as the corruption index is concerned, the country is ranked the 113rd least corrupt nation out of 180 countries according to the 2019 Corruption Perceptions Index reported by Transparency International. That’s 14 notches below the 2018 ranking. 

To note, “corruption is a form of dishonesty or criminal offense undertaken by a person or organisation entrusted with a position of authority, to acquire illicit benefit or abuse of power for one’s private interests and gains.”    

Corruption in the Philippines is prevalent on different scales. It can be found at all levels of the state apparatus. It ranges from “petty bribery” to corruption that affects the government on a large scale, or what you call “grand corruption”, and the kind of corruption that is so prevalent that it becomes a part of the everyday structure of society like organised crime, or what you call “systemic corruption.” 

Thus, the alleged corruption in the Philippine Health Insurance Corporation (PhilHealth) is an exemplification of “systemic corruption” in present-day Philippines. 

Systemic Corruption 

PhilHealth has been wracked by fraud for many years. Some of the alleged corruption in PhilHealth that prevailed since the uncovering of the massive fraudulent scheme of padded medical claims and treatments for ghost patients for years by the Commission on Audit (COA) was the fabricated crediting of premiums payments to Accenture Inc. in the Treasury and Membership Databases of PhilHealth that happened from October to December 2010, and from February to September 2011, which amounted to PHP 114 million (US$2.34 million). 

Such deceitful transactions allegedly started since late 2009. In 2012, cheques for the premium payments of Accenture Inc. were encashed in at least two branches of Metrobank in Batangas instead of being remitted to PhilHealth. This anomalous plot was accordingly made possible because of the collusion between PhilHealth employees and a syndicate criminal group. 

However, around November 2012, PhilHealth reported that the diverted premium payments had been recovered in September 2012.

Moreover, in as far as rampant misconduct in PhilHealth is concerned, it consists of fake and bloated claims of health benefits. For instance, in 2014, PhilHealth investigated six health facilities for actively soliciting patients for cataract removal. Cataract removal in 2014 ranked fourth among PhilHealth’s top conditions, with the total benefits paid out reaching PHP 3.7 billion (US$76 million). 

Likewise, around PHP 150 billion (US$3 billion) had been lost to overpayments, up-casing, and other forms of fraud since 2013. Some of these fraudulent transactions and controversies in PhilHealth that cost billions of pesos are currently the subject of investigations by several government institutions and congressional hearings include but not limited to: (a) the all case rates (ACR); the dialysis scam which involved an alleged multibillion-peso scam involving “ghost” (dead) patients filing claims for kidney dialysis treatments from WellMed Dialysis and Laboratory Center from 2016-2018; (b) the alleged overpricing of a PHP 2.1 billion (US$43.1 million) information and communication technology (ICT) project; (c) the over-bloated list of senior citizen beneficiaries that included several members aged below 60 years old; (d) other “money-making schemes” in PhilHealth like rebates, fictitious patients and overpricing; and (e) the Interim Reimbursement Mechanism (IRM) wherein favoured hospitals were allegedly adv
anced millions of pesos as assistance amid the COVID-19 pandemic. 

The whistle-blower, Attorney Thorsson Keith claimed that PhilHealth officials pocketed some PHP 15 billion (US$308.3 million) through fraudulent schemes partly through the Interim Reimbursement Mechanism (IRM). The IRM is the policy mechanism used by PhilHealth to justify the extension of cash advances to hospitals ahead of natural disasters and calamities like the COVID-19 pandemic.  

Source: Transparency International 

Combatting Corruption In PhilHealth

In response to the corruption controversies surrounding PhilHealth, significant efforts have been put forward by various government institutions to get to the bottom of the alleged corruption issues faced by the state-run health insurance company and to ensure that the perpetrators of these corrupt practices will be held accountable. 

President Rodrigo Duterte ordered an investigation into allegations of corruption in PhilHealth. He initiated the formation of a “multi-agency task force” to probe the issues plaguing the state insurer. This inter-agency task force is led by the Department of Justice (DOJ), and its members include the Office of the Ombudsman, Civil Service Commission, Office of the Executive Secretary, the Presidential Anti-Corruption Commission (PACC), Palace Undersecretary Melchor Quitain, and the Presidential Management Staff. 

The task force has been given the extraordinary power to conduct lifestyle checks on PhilHealth officials and employees, conduct audits on PhilHealth finances, and recommend preventive suspensions, if necessary, to ensure that the investigation would not be encumbered. 

The PACC though part of “Task Force PhilHealth,” has conducted a separate investigation and thus far found 36 PhilHealth officials involved in alleged irregularities. Commission chief Greco Belgica said that a report would be submitted to the President and that charges would be filed against the 36 officials in the Office of the Ombudsman. 

He said 36 PhilHealth officials are on the initial list of the PACC under investigation, with 13 to 15 of them close to being charged before the Office of the Ombudsman. Likewise, simultaneous congressional hearings at the House of Representatives and the Senate on the alleged corruption cases engulfing PhilHealth are also being conducted in aid of legislation.  


Indeed, through the years, the immense corruption in PhilHealth has become the norm rather than the exception. And this sad state of affairs has become even more apparent, against the backdrop of the COVID-19 pandemic. 

The COVID-19 pandemic thus far has made the anti-graft, corruption and good governance efforts of the Duterte administration vulnerable and precarious to corruption. The corruption issues besieging PhilHealth has compromised – to a considerable extent – the country’s pandemic responses and undermined the much-needed trust in public institutions amid the COVID-19 crisis. 

The problem of corruption in PhilHealth more than anything victimises the vulnerable, the sick, and poor Filipinos who are being cheated on medical assistance that could have been used to treat their illnesses and possibly save their lives. PhilHealth has thus far failed the people it promised to serve. 

The irregularities in PhilHealth should not be allowed to persist. Thus, a more heightened political will and stronger governance response on the part of the Duterte administration are needed to curb the corruption problem in PhilHealth.  

In the process of addressing corruption in PhilHealth, leaders, and lawmakers of the country need to take cognisance of certain aspects of PhilHealth as a public institution that need to be changed, strengthened, and reinforced. For instance, PhilHealth, representation on the board is skewed in favour of the government. 

The current composition of PhilHealth underrepresents patients, health providers, concerned civil society groups, and the public (Filipino citizens) in general, and overrepresents the government. There’s only one slot on the PhilHealth board dedicated to consumer/patient representation. This a major deficiency that needs to be addressed if accountability and transparency are to be ensured in PhilHealth’s operations and decision-making processes.

Thus, there’s a need to widen the membership of the PhilHealth board to accommodate other concerned stakeholders who could serve as “watchdogs” on PhilHealth’s affairs and operations.

Likewise, “systemic corruption” like that in PhilHealth is also a function of the weak “merit culture” of the country. If corruption is to be curbed at its root, the “merit culture” has to be strengthened further by recruiting, promoting, and rewarding people based on qualifications, experience, and performance. 

The civil service should not be politicised if corruption is to be curtailed. On the other hand, one has to take a closer look as well at how the “culture of impunity” that pervades PhilHealth can be addressed, where corrupt acts though already detected and exposed, more often than not, go unpunished. This “culture of impunity” very much apparent in PhilHealth must stop.  

Conversely, leaders and lawmakers in the country should also look at how they can strengthen “societal accountability,” in which civil society, the media, and the public, in general, can monitor and address the actions of public institutions like PhilHealth and its officials. Reforms in this area should include enabling frameworks such as legislation of the right to information. 

Hence, the passage of Freedom of Information (FOI) Bill is important for it will institutionalise the anti-corruption drive of the government by empowering citizens to expose wrongdoings by increasing their access to information, which to a greater extent will promote transparency, accountability, citizens’ participation, empowerment, and to some extent promote an anti-corruption culture and mindset among Filipinos in general. Hence, this piece of legislation is very important. 

Furthermore, in the process of trying to address the corruption problem in PhilHealth, government leaders and lawmakers need to understand the issue of corruption in PhilHealth is a reflection of a wider whole, where corruption is entrenched in all levels of Philippine society

Leaders and lawmakers need to take cognizance of the fact that the corruption problem in PhilHealth is cyclical and systemic, thereby requiring a systemic solution, not a piecemeal one. This is evidenced by the fact that the “cancer of corruption” in PhilHealth has not receded over time despite the constant attempts of establishing institutional reforms and changing the president or board members of PhilHealth. 

One has to be conscious of the fact that the systemic corruption in PhilHealth exists because corrupt behaviour is not rare and isolated in the community, rather it is widespread and somewhat culturally ingrained. Cultural and structural “blind spots”, which more or less refer to cultural and structural norms, values, and praxis like “nepotism”, “favouritism”, and “clientelism”, are widely practiced and ingrained both, in the public and private spheres. 

Hence, there’s a need for a profound analysis on what are the socio-cultural factors that drive corrupt practices in general, and how corrupt practices are knitted into the fabric of daily living and their fundamental cultural motivations. 

One must not forget that corruption is a social and political phenomenon driven by human behaviour and circumstances. Hence, corruption should not just be treated as an institutional and legal problem, but a social, political, and cultural phenomenon as well.

Source: The ASEAN Post

Prof. Anna Rosario Malindog-Uy

Prof. Anna Rosario Malindog-Uy is a Ph.D. Candidate at the Institute of South-South Cooperation and Development (ISSCAD), Peking University, Beijing, China. She is currently a director and the Vice President for External Affairs of the Asian Century Philippines Strategic Studies Institute (ACPSSI), a think tank based in Manila. She also serves as the political/geopolitical analyst of ACPSSI. Currently, she is a Senior Researcher of the South China Sea Probing Initiative (SCSPI) and a Senior Research Fellow of the Global Governance Institution (GGI). She is also the President of Techperformance Corp, an IT-based company in the Philippines. Prof. Anna Uy taught Political Science, International Relations, Development Studies, European Studies, Southeast Asia, and China Studies. She is a researcher-writer, academic, and consultant on a wide array of issues. She has worked as a consultant with the Asian Development Bank (ADB) and other local and international NGOs.