Recto, Ledesma Face Plunder and Graft Raps Over PhilHealth Fund Diversion

Executive Secretary Ralph Recto

Recto, Ledesma Face Plunder and Graft Raps Over PhilHealth Fund Diversion

By Wilma N. Yamzon and Bing Jabadan – TheNATIONWEEK.Com | December 22, 2025

MANILA, Philippines – A group has filed plunder and graft charges against Executive Secretary Ralph Recto and former PhilHealth President Emmanuel Ledesma Jr., alleging the illegal transfer of P60 billion in PhilHealth surplus reserve funds to the national treasury.

The move sparked outrage and ignited a debate over the agency’s financial management and its ability to provide adequate healthcare for Filipinos.

The “Save the Philippines Coalition” lodged the 15-page complaint with the Office of the Ombudsman on Monday, demanding the removal of Recto and Ledesma from their respective positions.

The charges include violations of Article 220 of the Revised Penal Code (technical malversation), Republic Act No. 3019 (Anti-Graft and Corrupt Practices Act), Republic Act 7080 (Anti-Plunder Law), and grave misconduct under Republic Act 6713.

The complainants, including Irene Caballes, Elmer Jugalbot, Gerlyn Ogong, Emerita Pecson, Susan Villar, Mussolini Lidasan, Jose Olivar, and Jaime Miralles, contend that Recto and Ledesma deliberately disregarded legal provisions designed to protect PhilHealth’s reserve funds.

They point to Republic Act 7875, which mandates increased member benefits or reduced contributions if PhilHealth’s reserves exceed the required limit.

They also cite Section 11 of Republic Act 11223, which explicitly prohibits the allocation of reserve funds to the national government’s general fund or its agencies.

The coalition accuses Recto, a former finance secretary, of improperly including PhilHealth reserve funds in the excess funds of government-owned corporations, despite existing legal restrictions.

On the other hand, Ledesma is accused of failing to challenge Recto’s directive, thereby implicating both in the technical malversation of funds.

The coalition has warned that the unlawful transfer of PhilHealth reserve funds to the national treasury endangers the nation’s healthcare program.

Supreme Court Ruling, Lingering Questions

The Supreme Court (SC) unanimously ruled on Dec. 3, 2025, that the P60 billion transfer was illegal and ordered its return, permanently barring future transfers of an additional P29.9 billion.

The ruling, penned by Associate Justice Amy Lazaro-Javier, focused on grave abuse of discretion and did not address Recto’s potential criminal liability for technical malversation or plunder.

The controversy extends beyond the initial transfer, as critics point to Recto’s subsequent directive instructing PhilHealth to transfer P89 billion to the Bureau of the Treasury in April 2024.

The move has raised concerns about the agency’s financial stability and its ability to meet the healthcare needs of Filipinos.

The amount was intended to fund unprogrammed items in the 2024 national budget, projects contingent on excess funds.

Sen. Bong Go echoed these concerns, stating, “It is unacceptable that there was funding that was not used to help PhilHealth members.”

“Why does PhilHealth have excess funds when there are many patients in need of help?” he said.

Transparency, Accountability Under Scrutiny

The transfer of the P89 billion fund has also amplified calls for transparency and accountability within PhilHealth.

While the funds are earmarked for national development projects, the action raises questions about the agency’s ability to adequately address the healthcare needs of Filipinos, particularly the poor.

Many Filipinos struggle to access costly medical services due to limitations in PhilHealth coverage, forcing them to seek financial assistance from external sources.

Potential Plunder Charges Loom

Former PhilHealth President Emmanuel Ledesma Jr.

Former SC Senior Associate Justice Antonio Carpio has suggested that Executive Secretary Ralph Recto could face plunder and technical malversation charges if the high court determines that the Bureau of the Treasury (BTr) illegally used P167 billion in trust funds, including the PhilHealth funds, to finance flood control projects.

Carpio argues that the diversion of funds breached constitutional safeguards, including the prohibition of transferring appropriations except as savings by the president and the requirement that special funds collected from taxes, such as PhilHealth’s sin tax revenues, must only be used for their designated purpose.

A Betrayal of Trust: The “Double Robbery”

The SC ruling has exposed a deeper injustice:

• the potential of “double robbery” of the Filipino people.

The government initially classified P89.9 billion of PhilHealth reserves as “excess” and transferred them to the national treasury.

The SC intervened to halt further transfers, but P60 billion had already been diverted by the government.

The funds were allocated to “unprogrammed appropriations,” a term critics describe as a modern-day pork barrel.

The Universal Health Care Act mandates that PhilHealth maintain reserves equivalent to two years of projected expenses.

Any excess must be used to enhance benefits or reduce contributions, never appropriated by the government.

The “double impact” stems from the fact that taxpayers effectively paid once the funds are misappropriated and will likely pay again to restore the P60 billion to PhilHealth’s budget.

The Stakes are High

The controversy surrounding the PhilHealth fund transfer highlights the critical need for accountability and transparency in the management of public funds, particularly those dedicated to healthcare.

Families are already struggling with out-of-pocket expenses, hospitals are experiencing delayed reimbursements, and PhilHealth’s support value remains inadequate.

Treating PhilHealth as a financial cushion is not only unlawful but also harmful to the Filipino people, especially the poor.

The focus must shift to ensuring that PhilHealth funds are used to provide accessible and affordable healthcare for all Filipinos.

The call for accountability remains strong, demanding a thorough investigation and closure of loopholes that allow health funds to be treated as political assets.