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Referral fees, or bribes?

Corporate hospitals have legitimised paying hefty commissions to independent doctors for sending patients to them.
Hindustan Times | By Menaka Rao, Mumbai
UPDATED ON NOV 22, 2011 01:55 AM IST

Dr Kiran Bhosale (name changed), an orthopedic surgeon, was surprised when marketing professionals of a tertiary care hospital in Andheri visited him eight months ago. “This was their second visit and they were again offering me money to send patients to them. I told them I don’t indulge in such malpractices,” said Dr Bhosale.

According to Dr Bhosale, the hospital was giving him Rs 11,000 for referring patients requiring a minor procedure, and Rs 20,000 for those undergoing major procedures. He, however, declined to name the hospital, saying: “Everyone in the industry indulges in this practice.”

Fee splitting is a term used for a commission given to a doctor for referring a patient to another doctor or hospital for investigations such as MRI, CT scans and X-rays. While this practice has been prevalent for years, private hospitals, facing cut-throat competition, have now institutionalised it.

“Many organisations have rationalised the practice by giving it names such as association fees, referral fees, or even visitation fees. But the actual contribution of the doctor is zero. This is nothing but corruption and bribery,” said Dr Nagraj Huilgol, an oncologist.

According to insurance firms, the referral fee, sometimes mentioned in the bills sent to them, is about 25-30% of the medical cost, and has to be borne by the patient.

The key reason such malpractices are becoming brazen is that they are difficult to prove. “There is no concrete data on this practice. But a majority of referrals are based on some form of fee splitting. This is against the grain of medicine, which is fulfilling a social purpose of providing health care. The profession is losing its credibility and legitimacy,” said Dr Sanjay Nagral, a surgeon who has written extensively on the fee-splitting system in the Indian Journal of Medical Ethics.

The medical fraternity appears reluctant in putting a lid on this practice.

In 2004, the Delhi Medical Council (DMC) did not penalise a doctor who admitted to charging the patient an additional Rs 4,125 as fees for the referring doctor. The doctor said he was within this right to share his fees as a “goodwill gesture”. The DMC in its order merely asked the hospital to stop the fee-splitting practice and act more professionally.

According to Dr Kishore Taori, president of the Maharashtra Medical Council (MMC), “Ultimately the booty shared by the doctors comes from the patients. Even more dangerous is the fact that this practice compromises the management of patient. Extra tests are prescribed, the patient is kept longer in hospital. No doctor should do anything that jeopardises the medical profession. A doctor-patient relationship is based on trust.”

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