Transparency of Third Party Administrator Fee Arrangements in Singapore
Ministry of HealthSpeakers
Summary
This question concerns the potential direct regulation of Third Party Administrators (TPAs) and the enhancement of transparency regarding their fee arrangements with medical practitioners and insurers. Dr Tan Yia Swam inquired if TPAs should be regulated independently and whether their financial relationships with insurers require official oversight. Minister for Health Gan Kim Yong responded that MOH focuses on regulating direct healthcare providers under the Private Hospitals and Medical Clinics Act to ensure patient safety. He highlighted that while doctors must currently ensure TPA fees comply with the Singapore Medical Council’s Ethical Code, the upcoming Healthcare Services Act will mandate itemized TPA charges on bills. Minister for Health Gan Kim Yong added that a project team is currently reviewing TPA regulations to address potential patient risks and improve existing measures.
Transcript
79 Dr Tan Yia Swam asked the Minister for Health (a) whether the Ministry has assessed if Third Party Administrator (TPA) companies should be directly regulated rather than indirectly through doctors' disclosure; (b) whether the transparency of TPA fee arrangements will be enhanced beyond the Singapore Medical Council Ethical Code and Ethical Guidelines; and (c) whether the financial relationship between TPA companies and insurers will be regulated.
Mr Gan Kim Yong: MOH's primary concern is to ensure patient safety, welfare and continuity of care. As such, MOH focuses on regulating direct providers of healthcare services – which will impact patients directly. This includes the provision and advertisement of services that diagnose, assess or treat diseases or illnesses; provide nursing or rehabilitative care; or assess the health of individuals. This is a similar approach taken by regional and international healthcare service regulators.
As TPA services do not involve direct patient care, these companies are not regulated under the Private Hospitals and Medical Clinics Act (PHMCA). However, there are guidelines issued under the PHMCA to ensure that patients are informed of every item charged for the clinic visit and when additional charges will be incurred.
In addition, the Singapore Medical Council’s Ethical Code and Ethical Guidelines (SMC ECEG) also provides guidance that medical practitioners contracting with TPAs should ensure they remain objective in their clinical judgement and provide the required standard of care. If TPAs are engaged, the fees charged by the medical practitioner must reflect the fair work done by TPAs in handling and processing the patients. The fees must also be transparent to the patient. The SMC ECEG specifically prohibits medical practitioners from paying TPAs, insurance entities or patient referral services (a) fees that are based primarily on the service the doctors provide or the fees doctors collect; (b) fees that are so high as to constitute "fee splitting" or "fee sharing"; or (c) fees which render doctors unable to provide the required standard of care. The onus is on the medical practitioner to ensure that the fees payable to the TPAs are in compliance with the SMC ECEG. If a medical practitioner is uncertain about whether a fee payable to a TPA would be in compliance with the SMC ECEG, the medical practitioner should refrain from entering an arrangement to pay such a fee.
In future, under the Healthcare Services Act, licensees using TPA services will be required to reflect TPA fees as a distinct category in the itemised bill given to their patients. This will further improve transparency and help patients make informed decisions.
MOH will continue to study the landscape and practices of these TPA companies. We have a project team looking at impact-based regulations, including a review on the regulation of TPA. If there is evidence of patient risks, we will look further into how TPA should be regulated, including enhancing the above measures where appropriate.