Some P1.8 million of public funds have been wasted due to the purchase of expired medicines by four government-owned hospitals in Bohol, according to the Commission on Audit (COA).
Meanwhile, the same four government hospitals are tagged by COA to have purchased “overpriced” medicines in 2022, meaning its procurement of drugs exceeded unit prices in the Philippine Drug Price Reference Index (DPRI), and the “overprice” could range from 428% to 3,478%.
By its computation, the COAs audit team said the difference between the cost based on the hospitals’ Project Procurement Management Plan (PPMP) against the DPRI amounted to a total of P22.8 million.
In recently released audit reports, COA identified the four hospitals as the Garcia Memorial Provincial Hospital (GMPH) in Talibon, Teodoro B. Galagar District Hospital (TBGDH) in Jagna, Cong. Simeon G. Toribio Memorial Hospital (CSGTMH) in Carmen, and Catigbian District Hospital (CDH) in Catigbian.
COA said the four devolved hospitals have the highest budget in 2022 and have been selected for the audit.
Based on the COA report, the four government-owned hospitals bought the P1.8 million worth of expired medicines through bulk procurement in 2022.
According to the COA, the hospitals “procured its drugs and medicines for six-month periods departing from the three-month requirement ceiling under Section 361 of Republic Act No. 7160 attributable to the incorrect implementation of bulk procurement approach resulting in total actual loss from expiration of P1,845,124.52 and exposure to risk of further spoilage and expiration in the subsequent periods,” COA’s report stated.
It said that TBGDH reported a total loss of P985,195.93; CDH, P453,233.17; CSGTMH, P400,155.19, and GMPH, P6,540.23.
The audit report added that the hospitals also implemented a policy where the Bids and Awards Committee allows for emergency purchase once the medicines reach 50 percent of their stock or if there is an unforeseen need.
But COA said the hospitals should have balanced the risk simultaneously with other concerns of availability of drugs and medicines.
The COA said that the hospital’s “current concept of bulk procurement is subjecting all its drugs and medicines needs for a given semester and having the winning bidder deliver all at once the drugs and medicines pursuant to the contract being awarded, which covers the hospital’s needs for the six-month period.”
“Although this approach may be able to address the availability of drugs and medicines as soon as the winning bidder delivers … it directly contravenes the three-month requirement of R.A. 7160. And as these continue, management’s exposure to further losses from spoilage and expiration of drugs and medicines in the succeeding periods also continues,” it pointed out.
Thus, COA recommended that the four hospitals should balance its concerns of ensuring availability of drugs and medicines with its procurement. In doing so, they might be able to avoid incurring costs from spoilage and expiration, it stressed.
OVERPRICED DRUGS
The audit report on alleged overpriced purchases was limited to the drugs and medicines inventory management of the identified hospitals, including review of procurement procedures, issuance and maintenance of stocks, and monitoring of reports of physical count of inventories (RPCI).
A breakdown of the audit computation showed the biggest price differences were found with the TGBDH totaling P7.69 million, closely followed by GMPH with P6.96 million.
CSGTMH was found to have exceeded DPRI costs by P5.88 million, and CDH by P2.27 million.
“High percentage of drugs and medicines for CY 2022 of the subject devolved hospitals exceeded the prices set in the DPRI 9th Edition attributable to the lack of delineation of duties as to reviewing and ensuring compliance with the index resulting in higher costs of drugs and medicines for patients,” the report noted.
Under RA No. 9502 or the Cheaper Medicines Law, procurement of drugs and medicines are supposed to observe the PMRI to ensure protection of public health through access to affordable quality medication.
“The DPRI is meant to reduce the wide and extreme variations in the procurement prices of medicines in the public sector, thereby, improving efficiency of procurement, stretch the health care budget by generating savings and prevent corruption in the sourcing of essential medicines across the national and local governments,” the audit team said.
In TBGDH, it was found that up to 93 percent of drugs and medicines in its PPMP exceeded the DPRI.
On the other hand, 80 percent was recorded in the case of GMPH, 78 percent in CSGTMH, and 74 percent in CDH.
Annex C of the report listed various generic medicines that were purchased at much higher prices by the four hospitals, including Amlodipine 10 milligram tablets (in boxes of 100) which was posted on the DPRI at only P53 but was written on the PPMP of TBGDH at P280 or a price difference of P227, a variance of 428 percent.
In CDH, the audit noted that potassium chloride 20 milliliter vials on DPRI was set at P23 but was listed on the hospital’s PPMP at P823 or a 3,478 percent price difference. (Kit Bagaipo)