Several doctors have asked the Singapore Medical Council (SMC) to clarify if they can continue to pay third-party administrators (TPA) a percentage of their takings when the new code of ethics comes into force next year.
The answer could affect the hundreds of thousands of people here who have employer or insurance health coverage.
The new Ethical Code and Ethical Guidelines from the SMC, the medical professional watchdog, comes into effect on Jan 1. It had said doctors may continue to pay for such services, but added: "Such fees must not be based primarily on the services you provide or the fees you collect and you must not pay fees that are so high as to constitute 'fee splitting' or 'fee sharing'."
At recent dialogues with the SMC to discuss the new code, doctors asked what "primarily" means in this case, and how high fees have to be to be considered as fee splitting. Those who have agreements with TPAs wondered if they needed to terminate their contracts.
There has so far not been a definitive answer.
To a query from The Straits Times, the SMC said: "We are deliberating (over) this matter at present and will be providing clarifications to the doctors in due course."
How each TPA works varies, but the majority have some control over the fees charged. They also do the administrative work, which often includes billing, and take a fee for their services.
The practice in the market is for the fee to be a percentage of the doctor's bill. The majority charge 10 per cent to 15 per cent, though some charge even higher. This is different from medical concierge services, which collect payment for introducing a patient to a doctor, with little or no additional services.
Dr Tan Chi Chiu, the gastroenterologist and SMC council member who chaired the committee that shaped the new code and guidelines, said that a reasonable observer might view 10 per cent of a $20,000 bill "as representing a windfall, rather than a fair business margin".
Parkway Shenton chief executive Veronica Allen noted that a flat fee might not be the best solution. She said: "A simple flat fee model may not be equitable in all situations and, in fact, may penalise doctors when they have smaller bill sizes."
Still, Parkway Shenton, which currently charges a flat 10 per cent fee, has decided to play it safe with a variation of fixed and variable fees to be launched by the end of this year.
Said Ms Allen: "Parkway Shenton is working out a fair fee structure with fixed limits and thus be based on the value we provide... (to) benefit all doctors."
Dr Low Lee Yong, chief executive officer of Make Health Connect (MHC), said his reading of the code indicates no prohibition against doctors paying a percentage of their bill to the TPA, so long as it reflects the work done.
MHC has been in the market for over two decades and manages medical schemes for 11 insurers and "several thousand corporate clients".
Dr Low pointed out that credit card companies also take a percentage of bills. This, he said, is fairer to doctors who have small bills, than charging everyone a flat fee.
MHC charges 10 per cent to 15 per cent, depending on the amount of work done and the credit risk involved, with fees starting from as low as 40 cents, he said.
Dr Desmond Wai, a gastroenterologist in private practice, said not all TPAs provide good service. It is up to doctors to join those that do provide value for money, he said.
Correction note: In an earlier version of the story, we identified Make Health Connect as Manage Health Connect. This is incorrect. We are sorry for the error.