MOH to probe alleged insurance fraud involving physios, doctors and others

SINGAPORE — Dodgy practices have emerged in the healthcare industry, involving doctors, physiotherapists, insurance agents and third-party administrators (TPAs) splitting money from inflated insurance claims among themselves via a referral and commission system, TODAY has learnt.

Responding to queries, the Ministry of Health (MOH) said it has received feedback on such practices, and will be looking into the matter.

“MOH takes a serious view of any attempts to defraud the healthcare system at the expense of Singaporeans,” a ministry spokesperson said. “Fraudulent behaviour such as unnecessary referrals and false claims for services not rendered raises the overall costs of healthcare in Singapore, and leads to Singaporeans paying more for their healthcare services and insurance plans.”

According to industry sources, some medical doctors are paid commission fees of 20 to 30 per cent of the physiotherapy bill if they refer their patients – such as those who require rehabilitation due to injury or illness – to private physiotherapy clinics.

Meanwhile, some medical concierge firms, or TPAs, are also approaching patients to sign up as clients and let the companies manage their healthcare needs, as well as sort out their insurance claims and payments. The firms’ agents would then reach out to doctors and private physiotherapy clinics and offer to refer patients to them.

The clinics may also upsell packages to the clients, paid for by insurance.

Such practices go against ethical guidelines for doctors as well as allied health professionals such as physiotherapists.

The MOH spokesperson reiterated that the Singapore Medical Council (SMC) has “provided guidance” to doctors on appropriate fee arrangements through its Ethical Code and Ethical Guidelines. Among other things, it covers the conduct of doctors in private contractual arrangements between healthcare providers and TPAs.

Speaking to TODAY, industry professionals warned that these errant practices and inflated claims could lead to rising insurance premiums.

The issue of rising health insurance premiums has been a hot topic in recent years, with some insurers of Integrated Shield Plans (IP) raising premiums amid escalating claims by policyholders.

In March, MOH announced that new IP riders must feature at least 5 per cent co-payment in a bid to curb what then-Senior Minister of State for Health Chee Hong Tat cited as “over-consumption, over-servicing and over-charging” that would lead to patients and insurance policy holders paying “escalating fees and premiums over time”.

THE MODUS OPERANDI

Some doctors whom TODAY spoke to said they have heard of fellow doctors paying commission fees to medical concierge firms for patient referrals, with some adding that they have been approached themselves.

Dr Desmond Wai, a gastroenterologist at Desmond Wai Liver & Gastrointestinal Diseases Centre, Mount Elizabeth Novena Specialist Centre, said: “Some concierge (firms) wanted to send me their patients, but wanted to take a 20 to 25 per cent cut of my doctor fees. One medical screening centre wanted to send me their patients with digestive problems, but again asked for 20 to 25 per cent cut of my fees.

“I turned them down as fee sharing is against SMC ethical guidelines.”

In 2016, the SMC barred doctors from paying fees to TPAs that are calculated as a percentage of fees that these doctors charge their patients. This came amid complaints that some middlemen were charging fees of up to 25 per cent of doctors’ fees for referral of patients.

However, it appears that “fee-splitting” is still going on in the industry.

A locum physiotherapist, who did not want to be named, said: “Sometimes they (TPAs) have people in the private hospitals who can look at the records (to check on patients’ insurance coverage). The doctors get S$20, $50 in commission… it’s an open secret.”

According to the locum physiotherapist, who works with private clinics, some medical concierge firms would approach patients with comprehensive integrated healthcare insurance plans to sign them on as clients.

The firms’ agents would then approach doctors and private physiotherapy clinics, offering to send patients to them.

The money claimed from insurers would then be split among the parties. Sometimes, the patients and insurance agents would also be involved in the “fee-splitting” arrangement, the locum physiotherapist added.

UPSELLING PHYSIO PACKAGES

Another method is to get private physiotherapy clinics to upsell packages to patients.

“For example, they will charge 10 sessions at S$200 each, which adds up to S$2,000. The patient only needs three sessions, so the remaining money (S$1,400) will go to the company (medical concierge) and clinic… the patient doesn’t know about it because the claims go to the insurers,” said the locum physiotherapist.

The Allied Health Professions Council’s (AHPC) code of professional conduct states that industry players “must not provide package deals, discounts or coupon discounts for professional services rendered”.

Mr Daniel Choo, 42, chief executive officer of The Medical Concierge Group (TMCG), a fixed fee medical concierge, told TODAY that he is also aware of the errant practices.

“I have physiotherapists whom I worked with asking me, ‘Are you taking a fee from us?’ I said no.”

He added that some medical concierge firms charge physiotherapists a commission fee of between 20 and 30 per cent.

Physiotherapists are also told to get patients to buy 10 to 12 sessions, even though they only require four or five sessions, said Mr Choo.

According to industry players, the errant practices are widespread and involve different players, including insurance agents.

Mr Choo, who had in the past spoken out against TPAs charging a percentage of fees, said he had been approached by insurance agents who were seeking to cut deals with him, for them to refer patients to TMCG’s doctors in return for commissions.

Some concierge firms are in fact run by insurance agents, he noted. 

Instead of taking fees from doctors or hospitals, Mr Choo said his company charges clients a fee for its services.

He stressed the ethical problems that would arise from the errant practices.

He said: “As soon as you take a fee from a healthcare service provider, that’s a conflict of interest. If you have chest pains, will I then send you to a cardiologist who is giving me more money, or you would rely on me to send you to a doctor who is going to look after you in your best interest at a fair rate?

He added: “Then there are others who take a percentage of the patients’ total bill. The more you spend on healthcare, the more they earn. They would be inclined to let you stay in the hospital longer than you really should.”

MOH urged patients and members of the public to lodge complaints to the AHPC or SMC if they “suspect any improper practices”.

Responding to TODAY’s queries, SMC reiterated that as per its guidelines, medical practitioners “must not ask for or receive fee kickbacks, payments or any other compensation in kind for referring patients to other doctors, medical service professionals or healthcare facilities”.

It added: “Patients or members of the public are encouraged to make a complaint to the SMC if they suspect that registered medical practitioners are involved or participating in such medical concierges for financial benefits, so that the SMC may investigate further.”

AHPC said every complaint will be assessed by an independent committee. “Upon completion of its deliberation and investigation, the (committee) may make the necessary order as it deems fit, including letters of advice or warning or referral to an inquiry by a Disciplinary Tribunal,” it said.

The Singapore Physiotherapy Association said it was “not aware of such practices” but pointed out that public confidence can be “severely damaged if practitioners are not mindful of their ethical responsibilities”.

“We do not condone any unethical and unprofessional practices,” said the association. It also advised customers to be “wise about paying higher fees than usual, and (they) should not agree to signing up for… extensive number of sessions”.

Mr Choo also urged policyholders to play their part, and not feed such errant practices.

“How can you expect a limousine ride for free… I’ve heard of companies that provide such services,” he said. “There is no free lunch. It’s going to impact the next generation’s insurance premiums.”

CORRECTION: An earlier version of the story said that the SMC barred doctors from paying fees to third-party administrators (TPAs) in 2016. The SMC had in fact barred doctors from paying fees to TPAs that are calculated as a percentage of fees that these doctors charge their patients. We apologise for the error.