Accounting Anomalies in PhilHealth: An Analysis of PhilHealth’s Financial Statements
(Application of Government Accounting Topics)
SETTING: MORNING TALK SHOW BROADCAST
INTRODUCTION
Insert background music.
Magandang umaga, mga kababayan! Welcome to JUICY TALKS. It’s 8 am in the morning.
GILL: Maybe a lot of you guys kumakain pa lang ng breakfast. Sana all! Kasi naman
nakakaloka ang breaking news ngayong umaga. Have you heard about the discovered
anomalies in PhilHealth, Jules? Steph?
JULES: Yes, grabe talaga! And to add, PhilHealth has been at the center of widespread
controversies and scandals over the years ha.
GILL: Truly! Actually, I have prepared a list of the recent controversies they were part of as well
as a quick rundown of the allegations unearthed from congressional hearings.
Present this sa PPT.
Controversies in recent years involving PhilHealth, its officials and employees, and partner
establishments:
1. Cataract Surgery Scam
2. Excessive travel allowance for PhilHealth interim chief
3. Employees protest vs continuous mismanagement
4. Kidney treatments of ‘ghost patients’
Allegations unearthed from the congressional investigations:
1. Interim Reimbursement Mechanism
2. IRM withholding tax
3. Proposed information technology budget
4. Procurement of IT network switches
5. ‘Manipulated’ financial statements
6. Overpayments in all case rate system
7. Additional burden on OFWs
8. ‘Mafia’
STEPH: Despite us finding out about those, it seems that proper actions are not made since it
just keeps getting worse. More so now that we’re battling a pandemic.
JULES: That is why it is important to discuss such a matter at present. To inform our audience
about the issue and why it is important to not let it just pass.
EVENT/SCENARIO
GILL: So ayun na nga, here’s today’s hot tea.
PhilHealth is once again subjected to massive scrutiny as COA found serious dishonesty and
falsification on its financial records. Various differences had been identified between the
financial documents that a team of COA auditors had examined and the separate financial
report presented to the PhilHealth board. This is believed to conceal the real financial situation
of the agency.
STEPH: To cite data, Alejandro Cabading — PhilHealth board member — said that total
premium contributions in the past year should have been reported at P166.517 billion less the
premium receivables at the end of the year of P9.178 billion. However, PhilHealth reported
premium contributions collected amounting to P151.543 billion, reflecting a variance of P5.795
billion.
JULES: Another is that among the dubious items auditors found was the bump in PhilHealth’s
net income last year, from P11.6 billion to P21.02 billion. They also saw that PhilHealth’s time
deposits ballooned from P1 billion to P70 billion from 2018 to 2019 along with a spike of P35
billion in payable benefit claims for the same period without a clear explanation.
GILL: Wow at all these manipulations. Imagine how dangerous this is? It results in unreliable
financial statements — the very basis of the board for actions.
STEPH: Talaga nga namang this could be dubbed as the crime of the year.
GILL: I agree, AND these issues surface at a time when the country is grappling with the
COVID-19 pandemic ha.
JULES: Perhaps, it would be nice for us, as accounting professionals, to shed some light on
this issue para naman maintindihan lalo ng audience how grave the situation is.
AVA3 TOPIC & ACCOUNTING STANDARD APPLICATION [GILL & STEPH]
