Bring back medical fee guidelines
by Conrad Raj
04:45 AM Mar 22, 2011
In the wake of the Susan Lim saga, it might be time to review the ban by the Competition Commission of Singapore (CCS) on medical fee guidelines.
Without going into the merits or demerits of the ongoing court case involving Dr Lim, many among the public have become concerned over the high charges being levied on medical services here in Singapore.
Singapore's reputation as a medical hub and its medical tourism business may also have been adversely hit by the court revelations and the testimony given by many in the medical field to overcharging by the profession.
In June last year, the CCS ruled that the guidelines were anti-competitive, on the grounds that price recommendations by trade and professional associations might harm consumers because they "distort independent pricing decisions" as there may be no incentive for cost-effectiveness or innovation.
The Guidelines on Fees (GOF) for services and procedures in the private sector were put in place in 1987 by the Singapore Medical Association (SMA) - which represents the majority of medical practitioners here - after complaints of overcharging for medical services by doctors who were more interested in squeezing their patients than in curing them.
The GOF is a set of recommendations on private doctors' professional fees, which includes fees for consultations, surgery, preparation of medical reports and court appearances.
But the CCS felt that the GOF was now redundant as other benchmarks had become available - namely that of government hospitals, which provide hospital care and medical services for 80 per cent of the population. And the CCS noted that since these restructured hospitals do not refer to the GOF when making pricing decisions, patients could use their charges as a basis for price comparison when going to private hospitals.
The CCS had also pointed out that the Ministry of Health (MOH) requires patient medical bills to be itemised and financial counselling be provided and that hospital bill sizes are made public on MOH's website.
The commission urged the SMA to "work with MOH and hospitals to further improve the delivery of pricing information ... so as to allow patients to make more informed choices".
"In general, price recommendations by trade or professional associations are harmful to competition because they create focal points for prices to converge, restrict independent pricing decisions and signal to market players what their competitors are likely to charge," the CCS said. "This is a common position adopted by many competition agencies in the world, even for the medical sector."
But now, in response to a recent article in Today, the CCS has suggested that the SMA could provide information on actual pricing.
"In general, CCS recognises that information on actual pricing, and transparency in the reporting of prices actually charged in the market, are useful for consumers to make informed choices in their purchases of goods or services. CCS, therefore, supports the publication of historical price information to help consumers.
"However, this is very different from issuing price guidelines, which by their very definition, are intended to influence what prices should be set rather than merely providing historical price data," the CCS said in its letter.
Although the SMA had voluntarily scrapped its pricing guidelines in 2007, in October 2008, it wrote to the Ministry of Trade and Industry to request that the GOF be excluded from Section 34 of the Competition Act. After consulting with MOH, the ministry declined the request last year.
But it may be time now for the SMA to restore the public's faith in the medical services by bringing back guidelines, perhaps with the proviso that these are only guidelines and not mandatory charges binding all doctors.
These guidelines could provide a range, as suggested by the CCS, rather than a specific price that those in the medical services could charge. However, they should avoid the extremes which could give a distorted picture and could include overcharging by the unscrupulous.
The guidelines are a useful frame of reference: Patients should not be asked to buy a pig in the poke - a service they do not know the true value of. Dying patients may not be in the proper frame of mind to make the right judgement call.
And foreigners could use a guide to the range of charges they can expect in Singapore, enabling them to compare the expense with that of other medical hubs.
Perhaps private clinics should be requested to post their range of fees, either at their premises or on their websites, so that it would be possible for patients to shop around, like in the case of restaurants. Some doctors might feel it beneath their dignity to post their service and price menus - but then, being unscrupulous is even worse.
More importantly, such a move would not be anti-competition.
I guess it takes sensational headlines to make the CCS wake up to what the original price guidelines were supposed to do for patients. Call it "historical price data" or call it guidelines. It's semantics, really. What they have suggested was really what the guidelines were meant to do in the first place.