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Recession hit insurers pressurise consultants

By Francesca Robinson - 29th July 2010 8:34 am

Consultants are at loggerheads with private medical insurers over attempts to regulate their private professional practice and drive down fees.

BUPA has angered specialists by insisting on monitoring the professional standards of newly appointed consultants and the way they run their private practices.

The insurer launched a new contract three weeks ago which requires consultants to provide information about their clinical practice including, appraisals, audits and outcome data and also about their practice administration. It also imposes fixed fee schedules on them.

Mr Geoffrey Glazer, chairman of the Federation of Independent Practitioner Organisations (FIPO), accused BUPA of acting as a regulator.

He said the stance was vehemently opposed by most FIPO members. Over 90% of consultants who responded to a survey said that insurers did not have either the capability or the right to act as regulators.

“There was a strong sense (among 95.7% of respondents) that an insurer should not be responsible for monitoring the progress, appraisal and audit results of newly appointed consultants or indeed for any consultants.” This was part of the process of revalidation and came under the remit of the GMC, not a financial services company such as BUPA, said Glazer.

Significant numbers of specialists are also reporting problems with de-listing, capping and lack of recognition, another survey by the Independent Doctors Federation (IDF) has revealed.

More than 10% of the 224 IDF specialists who responded reported that they had been de-listed by an insurer; 36 reported a problem with recognition and 92 had had their fees capped.

AXA PPP and BUPA headed the list on both capping and de-listing issues with disagreement over fees cited as the major cause of their actions. IDF claims there have been widespread examples of inconsistency and lack of transparency in the application of these sanctions.

IDF chairman Dr Jack Edmonds said doctors who had been de-listed, capped or not recognised had often had previous reputations for excellence but were being suddenly disciplined by insurers “on a whim” for having the “temerity” to stand up for their independence.

Insurers were blaming “expensive doctors” for their current financial problems. But their profits were currently being hit by downward pressure on premiums, a reduction in clients, medical inflation and overheads charged by private hospitals. Doctors’ fees had generally remained static over the last five years.

“The private medical insurers have failed to discuss these issues, have not published transparent codes of practice and have not treated specialist doctors on a consistent or like for like basis. At the moment they seem intent on dictating their terms without negotiation or dialogue,” said Edmonds.

These concerns follows pressure from both BUPA and AXA PPP - who between them control 70% of the private medical insurance market - to impose financial penalties on patients who wish to see a consultant of their choice instead of a cheaper ‘recommended’ consultant. Private practice organisations say this harms the patient-consultant relationship, impacts on established care/referral pathways and restricts patient access to the most appropriate specialist.

Katrina Herren, medical director of BUPA Health and Wellbeing UK, said hundreds of specialists had already signed up for their contract for newly appointed consultants.

The contract only asked consultants to tick a box and to provide a date on an online form to let them know that they were abiding by the regulatory processes of the GMC. One of the reasons it introduced this was because there were gaps in plans for the regulation of consultants working solely in private practice. Consultants had specifically asked them to recognise specialists who do not hold substantive NHS posts.

“We just want to make sure that these consultants are abiding by the recommendations of the GMC as they are self-employed individuals. It’s very much easier and fair if we treat everybody in the same way,” she said.

She said it was asking consultants about administrative issues, such as how long patients had to wait for appointments or whether they could easily get hold of a secretary, because these were quality concerns that were important to the patients in the private sector.

Herren said the pressure to keep costs under control, which was particularly important to their corporate members, was the reason they had to sign up new consultants to fixed fee schedules. “One of things we are trying to do is balance the needs of people who would like to be paid a lot more with needs of large corporations who want to keep medical insurance products open to as many members of staff as possible.”

No consultant, she said, had been de-listed because they had refused to reduce their fees.

New figures from the consultancy Lang and Buisson show that demand for private medical insurance fell by record levels last year.

Tags: PMI, Private practice, Regulation
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Private health insurance takes a dive

The Guardian - 22nd July 2010 11:46 am

Private health insurance has suffered a record slump in demand, because the recession has forced employers and individuals to cut back on the costs of cover.

The number of people buying their own health policies has fallen to the lowest total since the 1970s, according to analysts Laing & Buisson.

With sluggish demand for both medical and dental insurance forecast to continue, more people will be turning to the NHS at a time when it is facing tough spending curbs.

The survey shows that the number of private medical policies fell 4.8% in 2009, after marginal growth of 0.6% in 2008, as the recession took hold. Employer-funded policies fell 4.7% and individual policies dropped 5.2%.

Trusts to lure patients for private treatment

By Francesca Robinson - 20th July 2010 8:45 am

Foundation trust hospitals will be able to take on an increasing amount of private work under new freedoms announced in the new white paper on health.

If the reforms are implemented the private patients income cap will be abolished, freeing foundation trusts to compete with the private sector for business.

The reforms will give foundation trusts scope to merge more easily and also to collaborate with private sector organisations.

The Foundation Trust Network has been lobbying for an end to the private patient income cap, set in 2002/03 to an average of 2% of revenue. This has restricted their ability to offer additional services and attract extra resources.

Health secretary Andrew Lansley told MPs that one of the best performing hospitals in Britain, the Royal Marsden, generated 25% of its income from private patients and this should be replicated across the country.

Sue Slipman, FTN director, said University College London Hospital was already providing their consultants with the opportunity to do private work. “Consultants benefit because they do not have to travel long distances to do their private work. The trust gains because their consultants on site if their NHS patients need them and helps them to attract high calibre doctors.”

Mental health trusts could offer talking therapies to business for their workforce health schemes. Liverpool Women’s Hospital was looking at a model to offer private fertility treatments, currently rationed by the NHS.

“Foundation trusts will play to their strengths. Some will provide the private treatment themselves, others will do the work in partnership with private sector providers and they earn money out of that,” she said.

Slipman said there would also be the opportunity for foundation trusts to exploit intellectual capital. “Clearly a lot of that is going to come from consultants and doctors - these reforms are incredibly motivating for everybody. It’s a way of saying now we can all get on with what we came in to the system to do. This very exciting.”

The government has said that all NHS trusts must become foundation trusts by 2013/14. Currently 130 of the 169 NHS trusts are foundation trusts.

But an analysis of the government’s proposals by Tribal, a private sector provider of public sector services, is pessimistic about the pace of growth of the private sector following the reforms.

“Over time the private sector will doubtless expand its currently tiny share of the market but organic growth will be comparatively slow. The major opportunity for the private sector would come if and when the current NHS incumbents fail to make the transition to the new regime. Under those circumstances government might well expect if not invite the private sector in.”

John Lister, director of the union-funded pressure group London Health Emergency, claimed the relaxation of the cap on private work was a step towards privatisation of the NHS. He complained that trusts might overstretch themselves in chasing private patients and could be driven by perverse incentives whereby they stood to make more money by getting patients into their private wings.

He also warned that doctors and other staff working for foundation trusts could also face the loss of national NHS pay and conditions as trust bosses cashed in on government plans to lift the cap on income from pay beds, private medicine, and deals with private companies.

“Andrew Lansley has made clear his wish to go further and make foundation trusts ‘off balance sheet’ as completely external providers to the NHS - meaning that their staff, too, would cease to be NHS employees,” he said.

Tags: Foundation trusts, Private practice
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Sacked radiology whistleblower vindicated

The Independent - 15th July 2010 9:17 am

An NHS worker with an unblemished 27-year career was sacked after she blew the whistle on senior doctors for moonlighting at a private hospital while being paid to diagnose NHS patients, an employment tribunal has heard.

Sharmila Chowdhury, 51, the radiology service manager at Ealing Hospital NHS Trust, repeatedly warned the hospital’s most senior managers that doctors were dishonestly claiming thousands of pounds every month.

A Watford employment tribunal judge took the unusual step last week of ordering the trust to reinstate Ms Chowdhury’s full salary and said: “I have no hesitation in saying that you are probably going to win.”

The ruling will be a bitter blow for the trust, particularly as despite the seriousness of the allegations, it failed for two years to take any action against Miranda Harvie and Peter Schnatterback, the two doctors accused of fraud at the hearing.

Instead, Ms Chowdhury was suspended after a counter-allegation of fraud made against her by a junior whom she had reported for breaching patient safety. Radiographer Michael McWha made the allegation at the request of Dr Harvie, the tribunal heard. Ms Chowdhury was sacked for gross misconduct in June, eight months after her suspension.

Soaring fees squeeze private practice earnings

By Francesca Robinson - 26th May 2010 3:05 pm

The increasing cost of medico-legal cover is forcing some high earning surgeons to quit their private practice.

The Medical Protection Society has had to hike subscription rates for consultants in private practice by an average of 7.5% this year - more than twice the rate of inflation.

“This reflects our experience of the last year, where we saw an increase in the cost of clinical negligence claims brought against hospital consultants,” said Dr Iain Barclay, MPS deputy medical director.

Neurosurgeons and spinal surgeons, classified as one of the highest risk categories, earning around £100,000 after expenses from their private practice now pay more than £35,000 a year for indemnity.

“Some of them are saying it’s just not worth it. Cover for this group of doctors is so high, not because there are a lot of claims made but because any claims that are made are likely to be catastrophic,” said Barclay.

MPS reviews specialist grouping within their grades every year. This year bariatric surgeons have been moved up a risk category while hand and upper limb surgeons dropped down a group.

The Medical and Defence Union of Scotland has increased its subscription rates on average for juniors by 2.33% and 3.32% for consultants.

Medical Defence Union rates have gone up by varying amounts. A neurosurgeon earning between £10,000 and £15,000 from private practice has not had any rise in their subscription fee for 2010, but those earning between £125,000 and £175,000 are paying 6% more. An ophthalmologist not doing refractive surgery and earning between £125,000 and £175,000 is paying 5% more, but a cardiologist or an anaesthetist earning the same amount is paying only 0.5% more.

Dr James Armstrong, the MDU’s head of underwriting, said: “Despite the rate of claims inflation remaining consistently above RPI, due to factors such as rising claimants’ solicitor costs and the increasing cost of providing long term care, sound financial management has enabled the MDU to limit any increase in subscriptions.”

According to the medical accountancy firm Stanbridge Associates some consultants are suffering additional pain from a fall in their private practice earnings.

Vanessa Sanders, a Stanbridge director, said earnings from cosmetic surgery and laser eye treatment were down about 10%, probably as a result of reduced demand during the recession.

But some other groups are doing well - orthopaedic surgeons who have been picking up extra private work from PCTs contracting out NHS work, such as hip replacement operations, have enjoyed an increased income of between 7 to 12% in some parts of the country.

Some dermatologists, who are in one of the lowest risk groups for medico-legal cover, have been enjoying a rise in private practice income of up 12-22%.

Tags: Insurance, Private practice
Posted in Hospital Dr News | 1 Comment »

“Insurers threaten clinical quality and choice”

By Mike Broad - 5th April 2010 4:47 pm

Private medical insurers are pressurising patients over costs and affecting patient choice, a survey of consultants suggests.

Ninety seven percent of respondents said these cost pressures were lowering choice and damaging continuity of care. Consultants were surveyed by the Federation of Independent Practitioner Organisations (FIPO) to identify how the patient-consultant-insurer relationship is being affected by the growth of fixed fee schedules.

Introduced by AXA PPP Healthcare in 2008, the schedule has resulted in some higher-charging consultants not being recognised by the insurer.

FIPO claims patients referred by their GP to a preferred specialist may be told by AXA PPP that their consultant of choice could overcharge and they should see another, cheaper, ‘recommended’ consultant. If patients still opt to see their first choice consultant, their reimbursements could be reduced.

Ninety eight percent of respondents felt that an insurance strategy like this is inspired by commercial considerations rather than quality considerations. The survey also suggests that AXA PPP is targeting 20% of consultants.

Mr Geoffrey Glazer, chairman of FIPO, said: “Almost a quarter of all consultants can cite instances where insurers have suggested referral of patients to an alternative consultant for cost considerations.

“This can destroy continuity of care as first choice consultants may already know the patient well and thus have a better understanding of the patient’s medical condition than a new specialist. This insurance tactic also undermines the long established referral pathway between GP and consultant as well as the patient-doctor relationship and places unnecessary pressure on patients who are sick, vulnerable and in need of medical care.”

The survey also shows incidents where private medical insurers have forced patients to undergo procedures in certain hospitals which may not be the best equipped or most convenient for them.

And patients have also been redirected to consultants who, while they may be of the same generic specialty, are not subspecialists able to deal with patient-specific needs.

Dr Simon Peck, head of provider audit and information at AXA PPP healthcare, said quality was the insurers “number one consideration”.

He said: “We offer our customers a wide range of choices. We have products where customers can receive a full refund of fees in any hospital in the UK, and we also offer various options whereby customers can obtain insurance at lesser rates, for example by agreeing to use our preferred provider network.

“FIPO appear to be confusing the issue of doctors’ personal fees with the issue of clinical quality. We do not believe there is any correlation between the level of fees charged and the quality of services provided. There are some doctors whose fee expectations are not commercially realistic. In general, our policies cover the vast majority of specialists’ fees in full.”

The survey was completed by 730 consultants.

Tags: Ins, Private practice
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Private practitioners at odds with health insurer

By Francesca Robinson - 17th March 2010 3:25 pm

A war of words has broken out between the private practice representatives and a medical insurer over accusations that the latter is trying to force down consultant fees.

The Federation of Independent Practitioner Organisations (FIPO), which represents independent sector interests, is protesting about a new low fee schedule introduced by AXA PPP Healthcare.

A fixed ‘fee schedule’ has been applied by AXA PPP to all new consultants since 2008. Failure to accept the schedule means that some consultants are not recognised by the insurer.

But now, FIPO claims that AXA PPP is trying to force the new schedule on to established, experienced consultants.

It says patients referred by their GP to a preferred specialist may be told by AXA PPP that their consultant of choice could overcharge and they should see another, cheaper, ‘recommended’ consultant.

FIPO claims to have heard reports that patients who opted to see their first choice consultant have had their reimbursements reduced by anything up to 50%.

“We believe that this system could cause problems for some of the patients who may be moved by the insurer to a new consultant who has no knowledge of their case,” said FIPO chairman Mr Geoffrey Glazer.

“PPP is also targeting some anaesthetists, and again interfering with clinical matters, as the team work and understanding between surgeon and anaesthetist can be critical; no PPP clerk should be allowed to take this responsibility and thus interfere in these critical decisions. How can a clerk understand the specialist nature of the anaesthetic, the working relationship of the consultants or of the exact clinical reasons why a GP has suggested a referral to a specific consultant?”

But Dr Simon Peck, AXA PPP healthcare’s head of provider audit and information, retorted that FIPO had misunderstood the situation. Like all insurers they had a system in place to stop payment of excessive charges in order to keep health insurance premiums affordable.

“The vast majority of specialists - well over 90% - charge fees at a level we are happy to pay in full and it follows that the vast majority of our customers have their bills fully reimbursed. That will continue.

“We have always declined to pay bills from the small number of very high charging specialists in full, however, and the only thing that has changed is that we have now clarified, through publication of our schedule of procedures and fees, the amount that we will reimburse.”

FIPO has launched a survey of consultants to assess the extent of their concerns about their relationship with medical insurers.

Mr Richard Packard, FIPO deputy chairman, added: “Reducing patient choice through last minute financial pressures, when the patient is most anxious and in need of help, is interference in proper clinical practice.”

Tags: Fees, Private practice
Posted in Hospital Dr News | 3 Comments »

The Revenue offers tax-avoiding consultants an amnesty

By Mike Broad - 12th January 2010 8:00 pm

The economic downturn is having far reaching consequences for hospital doctors.

Not only is it threatening the funding of their services, and their pay rises, for years to come, it has also prompted an inquisition into their financial affairs.

In these lean times, Her Majesty’s Revenue and Customs (HMRC) are under pressure to collect as much of our taxes as possible. With the country’s mountainous debt, every penny is needed.

You might have thought that when tracking down those professionals who have underpaid tax, it would have initially focused its energies on those who helped to create the economic crisis. Bankers and city speculators would have been top of my list.

But the HMRC has taken a different approach. For some undisclosed reason, doctors are at the top of their list.

It’s offering a three-week ‘amnesty’ - called a Tax Health Plan - for doctors who may have underpaid tax in the past to rectify the situation.

Doctors who make a voluntary disclosure will be asked to pay the full tax they owe and a penalty of up to 10% - and the Revenue has made it very clear these will be the best terms offered.

From April 2010, the HMRC will investigate doctors they believe have not declared their full income, dating back up to 20 years.

The Revenue is playing its cards close to its chest. As well as not explaining why its targeting doctors first, HMRC is also coy on the number of doctors involved in tax fraud (unofficial figures suggest 800) and the amount it wants to recover.

It briefly consulted with FIPO, BMA, HCSA and the GMC at the end of last year so one can surmise it is particularly interested in consultants with significant private practices.

Mike Wells, HMRC’s director of risk and intelligence, explained: “Our aim is to make it as easy as possible for people to come forward, make a full disclosure and benefit from the certainty of a reduced 10% penalty that HMRC is making available to those who qualify for this opportunity.

“From April we will be using the information at our disposal to investigate medical professionals who have not declared their full income. I therefore strongly urge any in this group who think they may have outstanding tax liabilities on their income to get in touch with HMRC and get their tax affairs in order simply and on the best available terms.

“This is the first step in enabling those with undisclosed income or gains to avoid a full tax investigation together with much higher penalties. The message is clear: contact us before we contact you.”

There’s no doubt the HMRC is adopting a tough approach. If a doctor has undeclared revenue, and ignores the Tax Health Plan, they could face an additional penalty ranging from 20% up to 100% of the tax due, and face an investigation that could result in criminal prosecution. It would question a doctor’s probity and be reported to the GMC.

If the doctor in question has evaded over £25,000 of tax, they will be ‘named and shamed’ with their details being published on the HMRC website and distributed on a press release to the media.

While not wishing to excuse any doctors who have avoided paying their tax and broken the law, the way HMRC is going about collecting unpaid taxes rom professionals raises some questions.

Consultants have from now until 31 March 2010 to register their intention to make a voluntary disclosure with HMRC. By 30 June, those who have registered must have made their disclosure as well as arrangements to pay all tax interest and penalties due.

That deadline doesn’t take into consideration the potential complexity of their financial arrangements, particularly if they’re contested. The HMRC will not give them any further time, which is unlikely to instil confidence in the process.

Furthermore, there is little information available for private practitioners working in group and partnership arrangements. Is one partner liable for the tax fiddling of another, for example?

It’s unacceptable that the Treasury loses an estimated £3bn a year in tax evasion, but is the HMRC offering enough of a carrot for tax evading doctors to come clean and save itself the time and effort of an investigation?

Some accountants and legal experts suggested the campaign will provide ‘easy pickings’ for the Treasury. Unlike bankers and lawyers, doctors don’t have the same level of expertise to call on in hiding any undeclared revenue.

The line from representative organisations, such as the BMA and HCSA, is consistent and clear: doctors who have concerns should consult their financial advisers to ensure their tax affairs are in order.

Stephen Campion, chief executive of the HCSA, said: “We are grateful that at least HMRC consulted with us to alert us in advance but the HCSA is not associated with, or party to, this campaign.

“However we do advise all hospital consultants and senior doctors to be aware of the HMRC campaign and take professional financial advice if at all concerned about tax liability and accuracy of self-assessment.”

To make a disclosure ring HMRC on 0845 600 4508, or use the e-form available via the HMRC website.

Tags: finance, Private practice
Posted in Features | 1 Comment »

Cosmetic surgery engulfed by “perfect storm”

By Mike Broad - 16th November 2009 9:58 am

There should be a Europe-wide ban on the advertising of all cosmetic surgical procedures, the president of the European Association of Societies of Aesthetic Plastic Surgery has demanded.

Mr Nigel Mercer, consultant plastic surgeon, says mounting public expectation, media hype and professional greed are creating a “perfect storm” around the cosmetic surgery market and measures need to be taken now to prevent it.

He says: “It is paramount that every person, organisation and regulatorinvolved in the cosmetic surgery industry strenuously protectsthe patient. If we do not do that there will be a backlash,just as there has been in the banking industry.

“This is notprotectionism but common sense. The world needs bankers morethan cosmetic surgeons.”

He believes many doctors involved in cosmetic surgery are putting their own financial interests a head of the duty to protect their patients. Mercer, writing in the journal Clinical Risk, and who is also the president of the British Association of Aesthetic Plastic Surgery, says: “We are now seeing a generationof surgeons who want to train purely to perform cosmetic surgery,rather than being attracted to performing reconstructive surgery.”

He continues: “If we have to sell anything, we should sellour advice, not procedures. If we cannot self-regulate, then,like the financial institutions, regulation will eventuallybe imposed.”

Mercer criticises aggressive marketing techniques, such as two-for-one offers and surgical holidays.

He says: “In no other area of medicine is there such an unregulatedmess. What is worse is that national governments would not allowit to happen in other areas of medicine. Imagine a ‘two-for-one’advert for general surgery?”

The media is complicit giving “the public the impressionthat cosmetic surgery procedures are quick fixes and carry norisk of downtime or complications. Nothing could be furtherfrom the truth and it defies common sense to think otherwise.”

Clinical effectiveness, or lack of it, is a problem and he warns that the industry should not sell procedures directly to patients. He cites the example ‘dermal filler’.

“In the US, there are only a handful of fillers with FDA approval, whereas in the UK there are over 100 onthe market. Why the difference?

“In the US, the products undergotesting as a ‘drug’, but in the UK they are testedas a ‘device’ and so only have to pass ‘CE’mark requirements, which relate to standards of production,not of efficacy. Drug testing is lengthy and expensive but CEmarking is not. That is why substances can be injected, whichare perfectly legal, but do not need to be licensed for efficacyor safety.”

Europe should adopt FDA-like testing for implantable devices, and seek to control the advertising of products, even online.

He calls for all providers of care involved must be subject to regular inspection andrevalidation. And for the development of an insurance product which would cover the patient for complications.

Mercer concludes by calling for cosmetic surgeons to behave responsibly, with integrity and probity.

Tags: Cosmetic surgery, Private practice
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Plans to enable waiting NHS patients to go private

BBC Health - 10th November 2009 9:06 am

Hospital patients in England may get the right to be seen privately if the NHS cannot treat them quickly enough.

Hospitals have to start treating patients within 18 weeks of referral - or two weeks in the case of cancer.

But ministers now want to give patients a legal right to private care - or treatment at another NHS centre if so desired - if this does not happen.

The Tories, who would scrap waiting time targets, said it was an “unaffordable and uncosted” pledge.

Some patients - in fact several thousand a month - are already being treated at private hospitals under the NHS through the patient choice initiative.

At the start of the referral process, they are able to choose from an approved list of providers that are willing to carry out the treatment at NHS cost.

But this latest initiative, which will be announced by health secretary Andy Burnham this week, will allow patients to opt to switch to private care at a later date if it turns out the NHS cannot see them within the deadline.