COA reveals Marikina Mayor Teodoro used health funds for Vietnam trip, other non-health related expenses
MARIKINA, Philippines— The City Government of Marikina, led by Mayor Marcy Teodoro, used millions of pesos from the city’s budget for health programs and services to fund a trip to Vietnam, infrastructure repairs, electrical supplies, and other expenses in violation of the Universal Health Care Act and other laws, according to a recent report from the Commission on Audit (COA).
The audit, which examined financial transactions from 2023 to early 2024, found that the city government under Mayor Teodoro failed to fully establish an SHF as mandated by Republic Act 11223, or the Universal Health Care (UHC) Law.
Since the City Government of Marikina has not yet established its SHF, the city utilized an already existing TF-HCI wherein all funds, payments, and reimbursements from PhilHealth are received. According to the City Treasurer, the HCI was established for health-related expenditures, the report cited.
However, the COA flagged a total of P45,621,586 in unauthorized disbursements.
It said that “the City Government of Marikina engaged in procurement activities totaling P45,621,586 that were not included in the Project Procurement Plans and Annual Procurement Plans from 2023 to 2024 in violation of RA 9184 or the Government Procurement Reform Act.”
Among the most glaring findings was a P2.3 million cash advance for the travel expenses of city officials, to Ho Chi Minh City (formerly Saigon), Vietnam. The expenditure, recorded under disbursement voucher 300-2309000105 dated September 6, 2023.
“While other documents attached thereto include an approved Authority to Travel of the incumbent Mayor Teodoro, letters from the Department of Interior and Local Government (DILG), invoices and other receipts. However, there were no evidence linking the travel expenses to any health programs or activities of the LGU,” the COA said.
In its reply to COA, the city government admitted that the funding was initially charged to the PhilHealth-Reimbursements and was subsequently credited back to the account through the transfer from the General Fund-Proper.
The COA’s special audit team maintains its position “that the cash advances do not align with the specific purpose of the trust fund.”
The audit also flagged multiple vouchers linked to the purchase of food and beverages using health fund allocations. The COA stated that these expenditures, along with the Vietnam trip, did not align with the purpose of the trust fund.
The COA said the amount of PhilHealth reimbursements made by the City Government of Marikina from September 8, 2023 to April 30, 2024 “could not be reconciled, raising concerns about the proper monitoring of the Trust Fund-HCI Account.”
The COA also flagged the improper appropriation and realignment of P130 million on September 6, 2023, and an additional P94.75 million on January 31, 2024, saying that these transactions were not compliant with Section 20 of the UHC Law, which requires that all health-related funds be pooled into the SHF and used exclusively for health services.
“The City Government of Marikina’s appropriation and realignment of funds under Appropriation Ordinance No. 066 dated on September 6, 2023, and No. 002 dated January 31, 2024, amounting to P130 million and P94.75 million, respectively are not in accordance with Section 20 of RA 11223 and Section Nos. 309 and 336 of RA 7160,” according to the COA report.
Section 20 of the UHC Law requires that creation of SHF wherein all resources intended for health services to finance population-based and individual-based health services, health systems operating costs, capital investments, and remuneration of additional health workers and incentives for all health workers.
Section 21 of the UHC law and its IRR provided that all income derived from PhilHealth payments of LGU-owned and managed health offices, facilities, and services shall accrue to the SHF to be allocated by the LGUs exclusively for the operations and improvement of the province-wide and city-wide health systems.
It said the city government used an existing trust fund, the TF-HCI, to manage PhilHealth reimbursements, wherein it found that significant amounts were realigned to non-health-related expenses, including P8 million for IT equipment, P25 million for infrastructure repairs and maintenance, P6 million in unspecified donations, and P91 million for “other supplies and materials.”
The COA refuted the city government’s claims that the funds transferred are savings, citing the Supreme Court decision that “savings” area realized only when the purpose for which the funds had been allocated were already satisfied, or the need for such funds had ceased to exist. Funds described as “unreleased or unallotted” are not necessarily savings.
The COA said, “the claim of the City Government of Marikina is belied by the fact that health-related services or programs are continuing programs which would exist and continue to function well for generations.”
The City Government also made unnecessary transfer of funds from trust fund to the general fund for the procurement of drugs and medicines for the city health office in violation of PD 1445.
The COA has recommended that Marikina expedite the establishment of a legitimate SHF and ensure that all PhilHealth reimbursements and related health funds are pooled and spent strictly for health-related purposes, as mandated by the UHC Law.
