The new guideline on TPA fees has been a topic of concern to doctors for several months, with some practitioners claiming that the high charges imposed have eaten into their earnings.
TPAs service many companies and are responsible for providing various intermediary services, such as administration and management of employer medical benefits and claims, and recruit doctors in private practice to be part of a TPA panel. For their services, TPAs charge companies for their employees’ healthcare expenses and also collect 10% to 25% administrative fees from doctors, calculated based on patient charges.
However, the practice has been likened by the SMC as an unethical practice of fee-splitting which could inadvertently cause an increase in medical costs incurred to patients.
New guidelines may inadvertently affect patient careDespite its improved transparency, many posit that the revised ethical guidelines will result in more implications for the medical industry as well as the quality of patient care.
In light of the new policy, doctors may choose to terminate their contracts with TPAs and in doing so, will need to elect a replacement doctor from the TPA panel to take over care for their existing patients.
However, this may prove challenging if many doctors leave TPAs. With only a small group of doctors or specialists left on the panel, patients will have limited options of medical services provided within the TPA panel.
Patients who opt to consult doctors who are not on the panel for other medical services will have to pay the market rate for medical fees, which are usually costlier than TPA fees, and extra medical expenses may not be reimbursed by employers.
An alternate solution would be to visit polyclinics or government hospitals where subsidised care is provided. However, this will increase the patient load to the already crowded public sector, and will gradually stretch public resources.
Dr Wai: TPAs should have more transparent fee structuresHowever, not all percentage-based charges will infringe the new guidelines according to the Singapore Medical Association (SMA), the College of Family Physicians Singapore and the Academy of Medicine Singapore.
Should the TPA fee be a “small percentage” of the doctors’ fee, or if a doctor’s practice is such that the majority of patient bills fall within a “narrow range”, these practices may not violate the new regulations according to the three doctors’ bodies, which have also conjointly suggested for a fixed administrative fee structure which is based on a cost-plus model.
In a published opinion article, gastroenterologist and hepatologist Dr Desmond Wai posited that TPAs adjust their fee methods in order to comply with the new guidelines.
Instead of charging administrative fees based on percentages from doctors’ fees, TPAs can impose a fixed fee per consultation – an amount which can be subsequently reviewed and adjusted based on the administrator’s operating costs.
Wai also suggested that TPAs amend reimbursement arrangements with doctors, such that the administrative charges are automatically deducted from reimbursement fees.
For example, if a patient consults a doctor for a gastroscopy, the TPA would previously reimburse the physician with S$100 and S$600 for consultation and the procedure respectively, and then charge the doctor 15% for administrative fees each month.
With the new guidelines however, TPAs can adjust their practice such that they reimburse S$85 for consultation and S$510 for the gastroscopy, without collecting the monthly administrative fee. This essentially adds up to the same amount of revenue for TPAs.
Regardless of how TPAs choose to comply with the new SMC regulations, Wai concluded that TPAs should be transparent about their fee structures to all stakeholders, be it companies, doctors, or patients, and should continue to improve their roles without compromising the cost or standard of patient care. MIMS
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