Singapore Medical Council clarifies position on fees paid by doctors to third parties

THE Singapore Medical Council (SMC) has clarified its position on percentage fees paid by doctors to managed care providers or third party administrators (TPAs).

In an advisory to doctors, it said doctors would be in breach of the new ethical guidelines to be implemented from Jan 1, 2017, if they were to pay TPAs fees based on a percentage of what they charge patients. Such a calculation does not reflect work done by TPAs in handling and processing the patients but in fact reflects work done by the doctors.

"Since the work done by third parties in handling and processing patients does not vary depending on the fees doctors charge patients, paying third parties fees that are based on a percentage of what doctors charge patients may be construed as a form of fee splitting between doctors and third parties, and inadvertently promote cost escalation," SMC said.

Under Section H3(7) of the ethical code, doctors are prohibited from paying TPAs fees that are based primarily on services doctors provide or the fees doctors collect; fees that are so high that they constitute "fee splitting" or "fee sharing"; or fees that render doctors unable to provide the required standard of care.

While the code is to take effect from January next year, SMC pointed out that the specific rules relating to fee payments between doctors and TPAs under Section H3(7) would be enforced only from July 1, 2017.

This means doctors will have another six months to sort out their financial arrangements with TPAs. The extension is meant to give doctors who have existing contracts with TPAs time to modify or exit the arrangements.

It would also give doctors time to ensure that their patients would not be left without any care, by providing the latter the means to consult them or other doctors after their exit.

Whatever fees paid by doctors to TPAs, SMC said, patient care must not be compromised. "Where the fees charged by doctors are diluted by the fees exacted by third parties, doctors must ensure that the portion of fees for their own services is not so low as to either render them unable to provide patients the standard of care required or require over-servicing in order to make it financially viable."

Any fees doctors pay to TPAs, if passed on to patients or payers, must also be disclosed, SMC said, urging doctors to start taking steps, including seeking independent legal advice, to ensure they would not breach the new code.

The clarification came after uncertainty arose within the medical community following the announcement of the new guidelines in mid-September.