Patients' interests should not be compromised by managed care fees

PARTS of the 2016 edition of the Singapore Medical Council's (SMC) ethical code and guidelines, which take effect in January, are roiling some quarters of the medical profession.

These portions pertain to managed care companies and third party administrators (TPAs) who link doctors to organisations which need healthcare services. The concern arises from the payment of fees to managed care companies and the possibility that doctors may face conflict of interest to the detriment of patients. SMC's stand on the ethics surrounding the fee model has come none too soon, as concern grows over escalating healthcare costs and insurance premiums. Already, complaints over excessive managed care fees appear to have claimed a casualty in the recent shelving of the initial public offer of Fullerton Healthcare which operates as a managed care provider and is accused of "aggressive" fee practices.

Managed care has been a part of the healthcare landscape for several years. Companies which act as managed care providers are an intermediary between doctors and specialists - who join as panel doctors - and corporations and insurers which offer healthcare benefits to staff and policyholders, respectively. Doctors in such a scheme enjoy an enlarged pool of potential patients. Human resource managers and insurers benefit from the efficiency of having a pre-selected panel of doctors, for instance, plus related administration services which may include the operation of a call centre. Administration fees collected by managed care companies are said to start at around 8 per cent of patients' bills, and may exceed 20 per cent. Such fees are typically not transparent to patients and may exacerbate healthcare costs. Worse still, the fees may compromise the referrals made by panel GPs (general practitioners) who may be obligated to refer patients to specialists who agree to let TPAs take a cut of their fees.