THIRD DIVISION
|
GODOFREDO S. SISON, in his capacity as
Deputy Administrator, Social Security System, Petitioner,
- versus - COURT OF APPEALS and DR. CONCEPCION O. LIM-TAN, Respondents. |
|
G.R. No. 124086 Present: QUISUMBING, J., Chairperson, CARPIO, CARPIO MORALES, TINGA, and VELASCO, JR., JJ. Promulgated: June 26, 2006 |
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D E C I S I O N
CARPIO, J.:
The Case
This is a
petition for review on certiorari[1] of
the Decision[2] dated
The Facts
SSS Regional
Office No. 6 in P1,654,345
while claims for PLMH amounted to P765,861.95. The claims were supposedly for the medical
care services by the hospitals to persons who represented themselves as SSS
members or as dependents
of SSS members.
Respondent
made oral and written demands for payment upon petitioner. Sometime in December 1988, respondent visited
petitioner in his office to inquire on the status of her claims. Petitioner told respondent that there would
be delays in the payment of her claims because there were irregularities which
require further investigation.[4]
In a demand
letter dated
1.2 Claims Processing
Claims from all hospitals will be compared with the average number of claims filed for the same time period as established by previous statistics. Any deviation will be investigated and if a claim is patently in violation of rules and regulations, it will be denied. If a claim appears doubtful, the System concerned will investigate and:
(1) file a case within ninety days suspending payment thereon; or
(2) pay within ninety days and subject it to pre-audit without prejudice to filing a case later.
The two Systems will be exchanging statistics on claims from each hospital.
Respondent asserted that because no case has been filed
suspending payment within the reglementary 90-day
period, SSS Cebu City Regional Office should pay
respondent within the 90-day period and subject the claim to pre-audit, without
prejudice to the filing of a case at a later time. Moreover, respondent directed petitioner’s
attention to the dismissal of I.S. No. 89-655, a criminal case filed by
respondent against petitioner for violation of Section 30 of the Medicare Law.
Respondent did
not receive any word from petitioner. On
Petitioner
alleged that SSS Cebu City Regional Office found that
several claims from LLMH and PLMH were systematically tampered.[8]
Tampering consisted of forgery of claimants’ signatures, claims for
reimbursement by people who were never admitted in the hospitals, and use of
SSS membership of other persons to pay purported hospital charges. SSS Cebu City
Regional Office then segregated the tampered claims from the valid ones. To justify the segregation, petitioner
referred to a memorandum on deceptions done by some hospitals and doctors
issued on
Aside from the
declarations above, the findings of the trial court also include the following:
Seventh: [Petitioner] Sison
admitted his awareness of PMCC Resolution No. 89-2074 authorizing payment of
eighty percent (80%) of all claims upon filing under certain conditions. This resolution however could not be availed
of by petitioner for the reason that it was adopted on
Eight
[sic]: [Petitioner] Sison
caused the publication in Sun Star Daily of Cebu and
then the Sunday Post of Tagbilaran City the alleged
involvement of [respondent] and her hospitals in the multi-million [M]edicare scam when, in truth and in fact, Sison could only specify the case of the Galimbas involving about SEVEN HUNDRED THIRTY NINE (P739.00)
PESOS.
Ninth: [Petitioner] Sison filed various criminal cases against petitioner (Exhs. “D”, “E”, “F”, “I”, and “J”) which were dismissed by the provincial prosecutor’s office.
Tenth: [Petitioner] Sison with malice aforethought caused the cancellation of the membership of certain self-employed members (Exh. “3”) without notifying [respondent] and the other hospitals in Bohol in order to justify his act which departs from tenets of good faith and fair play, and
Eleventh: [Petitioner] introduced evidence which were
either not priorly reserved for presentation during
the pretrial or were immaterial, impertinent and irrelevant to the extant case
such as Exh. “2”, Exhs. “3” to “8-A”, Exhs. “39” to “48”, Exhs. “49” to “117”, Exhs. “118” to “402”, Exh. “403”, Exh.
“419”, Exhs. “420” to “450” and Exhs. “451” to “457”.[11]
The Ruling of the Trial Court
In its
decision dated
Petitioner has the ministerial duty to pay respondent in view
of Circular No. 258. Thus:
WHEREFORE, in view of all the foregoing considerations, judgment is hereby rendered in favor of petitioner [Dr. Concepcion O. Lim-Tan] and against respondents [Godofredo Sison and the manager of the SSS Cebu City Regional Office] ordering forthwith:
1. Respondents Godofredo
Sison and the SSS Regional Manager, Region 7 to pay
jointly and severally petitioner the sums of ONE MILLION SIX HUNDRED FIFTY FOUR
THOUSAND THREE HUNDRED FORTY FIVE (P1,654,345.00) PESOS, for the claims
of Leona O. Lim Memorial Hospital and SEVEN HUNDRED SIXTY FIVE THOUSAND EIGHT
HUNDRED SIXTY ONE PESOS and NINETY FIVE CENTAVOS (P765,861.95) for the
claims of Paulina Lim Memorial Hospital with the
prevailing bank rate of interest thereon reckoned from demand of payment until
fully paid.
2. Respondent Sison
to pay petitioner ONE MILLION (P1,000,000.00) PESOS,
as moral damages and ONE HUNDRED THOUSAND (P100,000.00) PESOS, as
exemplary damages; and
3. Respondents to pay in solidum the attorney’s fees of counsels for
petitioner in the sum of EIGHT HUNDRED SIXTY SEVEN THOUSAND THREE HUNDRED ONE (P867,301.00) PESOS, representing twenty five percent (25% ) of
the total claims and damages herein awarded and the sum of TWENTY FIVE THOUSAND
(P25,000.00) PESOS, as litigation expenses.
SO ORDERED.[13]
On
1. The [trial] court cannot compel the performance of [a] discretionary duty of respondents-appellants [Godofredo Sison and the manager of SSS Cebu Regional Office] by mandamus;
2. The trial court erred in not holding that Petitioner-Appellee [Dr. Concepcion O. Lim-Tan] failed to exhaust administrative remedies before filing court action;
3. The trial court erred in not holding that Respondents-Appellants did not violate the PMCC Circulars and that they have the right and discretion to scrutinize, withhold payment and reject Petitioner-Appellee’s doubtful and fraudulent claims;
4. The trial court gravely erred in excluding Respondents-Appellants’ documentary exhibits allegedly on the ground that they were either not priorly reserved for presentation during the pretrial or were immaterial, impertinent and irrelevant to the case at bar, and the exclusion was done with grave abuse of discretion;
5.
The trial court committed serious error when it
ordered payment to Petitioner-Appellee the amount of P1,654,345.00
and P765,861.95, respectively for the [M]edicare
claims of Appellee’s two (2) hospitals, without
considering the previous payments already made by the SSS;
6. Respondent-Appellant Godofredo S. Sison is exempt from civil liability for official actions;
7. The trial court seriously erred in failing to recognize the legal principle of statistical improbability; and
8. The
trial court erred in granting unconscionable awards of moral and exemplary
damages.[14]
The Ruling of the Appellate Court
The appellate
court did not agree with petitioner’s position.
It upheld the trial court’s decision and modified the amount due. The appellate court stated that the records
of the case clearly revealed that petitioner, while alleging that respondent
committed fraud in her Medicare claims, suspended payment of the claims but did
not file the corresponding cases within the prescribed 90-day period. Thus, petitioner has the duty to pay
respondent’s Medicare claims without prejudice to filing cases at a later
time. Furthermore, the appellate court
held that the principle of exhaustion of administrative remedies does not apply
when the case, as in the present, involves a purely legal question.
The appellate court applied PMCC Res. No.
89-2074[15]
and ordered respondent, in his official capacity, to pay only 80%, or P1,936,165.50,
of the total P2,420,206.90 claims.
It found no basis for the award of moral and exemplary damages, but allowed
attorney’s fees and costs of the suit.
The appellate court ruled thus:
WHEREFORE, the appealed decision
of the lower court in Special Civil Case No. 4522 is hereby AFFIRMED WITH
MODIFICATION anent the amount of liability.
Respondent-appellant in his official capacity is hereby ordered to pay
petitioner only 80% of the total P2,420,206.90 [M]edicare
claims of the two hospitals concerned, or the sum of P1,936,165.50 minus
the already paid P1,054,604.59, or the Net Amount of Eight Hundred
[Eighty] One Thousand Five Hundred Sixty & 91/100 (P881,560.91) only
with the prevailing bank rate of interest reckoned from demand until fully
paid; attorney’s
fees equivalent to TEN (10%) PERCENT of the net total claim; and the sum of TEN
THOUSAND (P10,000.00) PESOS as litigation
expenses. The lower court’s award of moral and exemplary damages is deleted. No
costs.
IT
IS SO ORDERED.[16]
The Issues
Dissatisfied
with the appellate court’s ruling, petitioner filed a petition before this
Court and raised the following issues:
1. RESPONDENT COURT OF APPEALS EXCEEDED ITS JURISDICTION IN TAKING COGNIZANCE OF THE CASE DESPITE RESPONDENT LIM-TAN’S FAILURE TO EXHAUST ADMINISTRATIVE REMEDIES.
2. RESPONDENT COURT OF APPEALS ACTED WITH GRAVE ABUSE OF DISCRETION WHEN IT TOTALLY OVERLOOKED FACTS OF SUBSTANCE AND VALUE WHICH, IF CONSIDERED, WOULD JUSTIFY A DIFFERENT CONCLUSION AND AFFECT THE OUTCOME OF THE CASE.
3. RESPONDENT COURT OF APPEALS SERIOUSLY ERRED WHEN IT MISAPPLIED THE PROVISIONS OF PMCC RESOLUTION NO. 89-2074 AND ORDERED PAYMENT OF 80% OF THE TOTAL MEDICARE CLAIMS OF RESPONDENT LIM-TAN.
4. RESPONDENT
COURT OF APPEALS ACTED WITH GRAVE ABUSE OF DISCRETION IN HOLDING PETITIONER
LIABLE FOR ATTORNEY’S FEES AND LITIGATION EXPENSES.[17]
The Ruling of the Court
The petition
has partial merit.
The main issue
in this appeal is whether petitioner can be compelled by mandamus to pay
respondent’s claims. Other issues to be
discussed are the necessity of exhaustion of administrative remedies and the
extent of petitioner’s liability.
Nature of Settlement of Claims
Petitioner
submits that the settlement of Medicare claims within the 90-day period is
merely directory and cannot defeat the discretionary authority of petitioner to
withhold payment of fraudulent claims, specially those involving amounts as
huge as respondent’s claims. Petitioner
further states that the 90-day period prescribed for the filing of cases
against erring claimants cannot be regarded as mandatory because there is
nothing in the circular which states that filing of cases may not be done in
any other time than that designated.[18]
On the other
hand, respondent claims that despite her repeated demands, petitioner neglected
the performance of a duty which the law specifically enjoins him to
perform. Because of petitioner’s
neglect, LLMH and PLMH were excluded from the enjoyment of the right to be paid
for the hospitals’ services to availing SSS members.[19]
As a general
rule, the performance of an official act or duty which necessarily involves the
exercise of judgment
cannot be compelled by mandamus. It is
nonetheless also available to compel action, when refused, in matters involving
judgment and discretion, but not to direct the exercise of judgment in a
particular manner. However, this rule
admits of exceptions. Mandamus is
the proper remedy
in cases where
there is gross abuse of
discretion, manifest injustice, or palpable
excess of authority.[20] The exception applies to the present
case.
We agree with
petitioner that his office has the discretionary authority to withhold payment
of fraudulent claims. Petitioner’s
desire to protect government funds is laudable.
Even so, his zeal has to be tempered by the application of the mandate
of Medicare laws and regulations. Contrary
to petitioner’s assertions, the exercise of his discretionary authority to
approve and deny claims is not absolute.
Petitioner’s exercise of authority is defined by the limits provided by
Circular No. 258. Petitioner’s mandate under Circular No. 258 is clear. Petitioner can only deny a patently wrongful
claim. For doubtful claims, petitioner only has two options: (1) file a case
within 90 days and suspend payment or (2) pay within 90 days and subject the
claim to pre-audit. Payment of the claim
does not prejudice petitioner from filing a case at a later time. Moreover, the exercise of petitioner’s
discretionary authority cannot be indefinitely held in abeyance. As in the present case, government’s inaction
puts the financial standing of participating hospitals in a precarious
position. Indeed, instead of placing a
premium on participation in the government’s Medicare program, petitioner
effectively punished an accredited provider by refusing to provide payment for
services already rendered.[21]
The regulations have provided an adequate
safeguard for fraudulent claims which balance the government’s interests in
providing a comprehensive medical care plan and in giving such benefits to
rightful claimants. Petitioner’s
allegations of violation of Medicare laws and regulations are causes of action
which are separate and distinct from the case at hand. The allegations, accompanied by voluminous
exhibits, are petitioner’s attempts in justifying his willful neglect in
addressing respondent’s claims. However,
the same allegations do not excuse petitioner from acting on respondent’s
claims with dispatch.
Interestingly,
in spite of his failure to follow the procedure under Circular No. 258,
petitioner faults respondent for her alleged failure to exhaust administrative
remedies. Petitioner asserts that
respondent ought to have raised her claims for payment before the PMCC instead
of the trial court. However,
petitioner’s acts foreclosed respondent’s resort to administrative remedies. There was no express denial of respondent’s
claims; therefore, there is nothing to appeal to PMCC. Petitioner himself admitted his belated
action when he testified that he authorized check payments to respondent during
the course of the trial.[22]
Assuming arguendo that respondent made a mistake in
procedure, the state policy would still weigh heavily against petitioner. Application of the doctrine of exhaustion of administrative
remedies is relaxed when a strong public interest is involved.[23] In addition to the protection and promotion
of the people’s right to health,[24]
the Constitution provides that:
The State shall adopt an
integrated and comprehensive approach to health development which shall
endeavor to make essential goods, health and other social services available to
all people at affordable cost. There shall be priority for the needs of the
underprivileged sick, elderly, disabled, women, and children. The State shall
endeavor to provide free medical care to paupers.[25]
Republic Act No. 6111, as amended by Presidential Decree No.
1519 (“PD 1519”), established the
Philippine Medical Care Plan and created the PMCC. PMCC is the precursor of
today’s Philippine Health Insurance Corporation, which is more popularly known
as PhilHealth.
Sections 2 and 3 of PD 1519 state that:
SEC. 2. Declaration of Policy. It is hereby declared to [be] the policy of the government to gradually provide total medical service of our people by adopting and implementing a comprehensive and coordinated medical care plan based on the following concepts of health care:
a) There shall be comprehensive medical care according to the needs of the patient.
b) The use of government and private medical facilities shall be coordinated as public service instrumentalities for the people.
c) Optimum health care shall be achieved by preserving and promoting a proper interrelationship among physicians, patients and hospitals.
SEC. 3. Purpose and Objectives. The main purposes and objectives of this Decree are:
a) To provide medical care to residents of the country in an evolutionary way within our economic means and capability as a nation.
b) To provide our people with a viable means of helping themselves pay for adequate medical care.
Indeed, this
Court allows a liberal interpretation of the technical rules of procedure when
a rigid enforcement will result in a deprivation of legal rights.
Extent of Liability
We conclude
that petitioner, in his official capacity, must pay respondent the following
amounts for her claims for the period of August 1988 to April 1989: P1,654,345
for the claims of LLMH and P765,861.95 for the claims of PLMH. Payment must include the prevailing bank rate
of interest thereon reckoned from demand of payment until fully paid. However, this is without prejudice to any
claim which may have been extinguished by disallowance or by payment. In view of this, the trial
court should be allowed to admit evidence of such new facts and circumstances,
and thereafter modify the amounts to harmonize the same with justice and the
facts.[26]
We affirm the
appellate court’s deletion of the trial court’s award of moral damages as we
disagree with the trial court’s finding of bad faith on the part of
petitioner. However, we recognize the
damage caused by his inordinate delay in resolving respondent’s claims. Although this delay may be explained by
petitioner’s desire to prevent dissipation of government funds, petitioner’s
acts only serve to perpetuate the negative image of corruption in the government
bureaucracy. He gave cause for
respondent to set a personal meeting with him for a possible “negotiation” of
the claims and even became an open target for allegations of maliciously
persecuting respondent. As a public
official, petitioner ought to have acted with the highest degree of excellence,
professionalism, intelligence and skill.
Petitioner is thus liable, in his personal capacity, for exemplary
damages of P20,000. His liability should serve as a reminder for other
public officials that they should serve the public with utmost efficiency.
We delete the
award for attorney’s fees because, as stated earlier, there is no sufficient
showing of petitioner’s bad faith. As
respondent was compelled to litigate her claims, we charge petitioner with the
costs of litigation.
WHEREFORE,
the Court PARTLY GRANTS the petition. The Decision dated 27 February 1996 of the
appellate court is AFFIRMED WITH MODIFICATION. Petitioner Godofredo
S. Sison, in his official capacity, must pay
respondent Dr. Concepcion O. Lim-Tan actual damages for respondent’s
claims from August 1988 to April 1989 in the amounts of P1,654,345 for
the claims of Leona O. Lim Memorial Hospital and P765,861.95 for the
claims of Paulina Lim Memorial Hospital, plus
interest at the prevailing bank rate
reckoned from demand of payment until fully paid. However, this is without prejudice to any
claim which may have been extinguished, either by disallowance or payment, in
the meantime. Thus, the case at bar is
remanded to the trial court for determination of the remaining amount of actual
damages, after deducting such disallowance or payment, if any. In addition,
petitioner Godofredo S. Sison,
in his personal capacity, must pay respondent Dr. Concepcion
O. Lim-Tan exemplary damages of P20,000 and
costs of the suit. We delete the award for attorney’s fees.
SO ORDERED.
ANTONIO
T. CARPIO
Associate
Justice
WE CONCUR:
LEONARDO A. QUISUMBING
Associate Justice
Chairperson
|
CONCHITA CARPIO MORALES Associate Justice |
DANTE O. TINGA Associate
Justice |
PRESBITERO J. VELASCO, JR.
Associate Justice
ATTESTATION
I attest that the conclusions in the above Decision had
been reached in consultation before the case was assigned to the writer of the
opinion of the Court’s Division.
LEONARDO
A. QUISUMBING
Associate Justice
Chairperson
CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution,
and the Division Chairperson’s Attestation, I certify that the conclusions in
the above Decision had been reached in consultation before the case was
assigned to the writer of the opinion of the Court’s Division.
ARTEMIO
V. PANGANIBAN
Chief Justice
[1] Under Rule 45 of the 1997 Rules of Civil Procedure.
[2] Penned by Associate Justice Lourdes K. Tayao-Jaguros with Associate Justices Jorge S. Imperial and B.A. Adefuin-De la Cruz, concurring.
[3] Also referred to as Region 7 in various parts of the records.
[4] Records, pp. 154-155; TSN,
[5] Exhibit “A,” Folder of Exhibits, Vol. 1, pp. 1-2.
[6] Records, p. 91.
[7] Id. at 110.
[8] Rollo, pp. 11-12.
[9] Exhibit “455,” Folder of Exhibits, Vol. 8, pp. 3048-3052.
[10] Records, p. 164.
[11] Id. at 164-165.
[12] Id. at 163.
[13] Id. at 168.
[14] CA rollo, pp. 38-39.
[15] Atty. Rossi M. Castro, Acting Executive Director and Commission Secretary of the Philippine Medical Care Commission, in a letter dated 19 May 1989 to Mrs. Lydia Querijero, Manager of the Social Security System’s Medicare Department, wrote that:
Meanwhile the Commission has approved PMCC Res. No. 89-2074 last April 27, 1989 to be effective on May 1, 1989 authorizing payment of 80% of all claims upon filing under certain conditions, to wit:
1. hospitals which desire to avail need to apply
2. the hospital has no record of violations nor reported breach of warranties in the past 3 years prior to filing of claim
3. abuse of the privilege will disqualify the hospital from the accelerated payment plan.
This includes pending claim [sic] as of the above date, per presentation of the SSS representative, Atty. Eriberto Valencia.
[16] Rollo, p. 46.
[17] Id. at 14-15.
[18] See id. at 24-26.
[19] Records, p. 2.
[20] See Roque v. Office of the Ombudsman, 366 Phil. 568 (1999) citing Angchangco, Jr. v. Ombudsman, G.R. No. 122728, 13 February 1997, 268 SCRA 301; First Philippine Holdings Corporation v. Sandiganbayan, 323 Phil. 36 (1996); Kant Kwong v. Presidential Commission on Good Government, No. L-79484, 7 December 1987, 156 SCRA 222.
[21] See Philippine Health Insurance Corporation v. Chinese General Hospital and Medical Center, G.R. No. 163123, 15 April 2005, 456 SCRA 459.
[22] TSN, 28 December 1989, p. 34; TSN, 8 March 1990, p. 10.
[23] Philippine Health Insurance Corporation v. Chinese General Hospital and Medical Center, supra.
[24] Constitution, Art. II, Sec. 15.
[25] Id., Art. XIII, Sec. 11.
[26] See Heirs of Dialdas v. Court of Appeals, 412 Phil. 491 (2001).