Doctors must be able to justify TPAs fees, say 3 medical bodies

DOCTORS who pay managed care providers or third party administrators (TPAs) fees must be prepared to justify them when questioned by authorities on why the fees are reflective of the administrative services provided.

The Academy of Medicine Singapore (AMS), College of Family Physicians Singapore (CFPS) and the Singapore Medical Association (SMA) said this in a joint statement issued to doctors on Wednesday. The release follows SMC's advisory on Tuesday on the financial arrangements between doctors, TPAs, medical concierges and insurance entities.

The council had made clear that doctors would be in breach of the 2016 Ethical Code and Ethical Guidelines (ECEG), which is to come into force from Jan 1, 2017, if they paid third parties fees calculated based on a percentage of a referred patient's bill.

To give doctors time to modify or exit existing arrangements with the third parties and ensure patients are not left in a lurch, SMC had said the rules relating to percentage fees would be enforceable only from July 1.

On Wednesday, master of AMS Selan Sayampanathan, president of CFPS Lee Kheng Hock and SMA's president Wong Tien Hua said collectively: "Our position is that TPA fees based on percentages of doctors' fees is not the preferred way of charging as it may not reflect the actual work done by the TPA.

"A fixed TPA fee structure which reflects the actual work in handling and processing the patients is ideal, preferable and in line with the ECEG. Having a fixed fee structure that is multi-tiered to cater to different scenarios or putting a cap on fees chargeable may also be useful to allay suspicions of fee-splitting."

Having said that, the trio acknowledged that a percentage TPA fee structure might provide a level of administrative convenience in very specific and limited circumstances.

They said if the TPA fee represents a small percentage of the doctor's fee and the doctor's practice is such that the vast majority (such as over 80 per cent) of bill sizes fall within a narrow range, then a TPA fee that is calculated as a percentage of the doctor's charges "may well be permissible".

On grounds of prudence, the three organisations said they believe that administrative fees should, wherever possible, be based on a "cost-plus" methodology - fees charged should include costs incurred by the TPA for providing the services, plus a profit margin "that is appropriate and not out of proportion to the costs of the services provided".