When doctors overcharge, what price do they pay?

Relooking the decision of Susan Lim Mey Lee v Singapore Medical Council [2013] SGHC 122

by Eric Hu*

The decision of Susan Lim Mey Lee v Singapore Medical Council [2013] SGHC 122 (“the present case”) is a significant one as it sets out a clear position in Singapore that doctors have a higher ethical duty which triumphs over all other commercial considerations.

Dr Susan Lim was the principal physician for a member of the royal family of Brunei and she billed a total of approximately $24 million for her services. Dissatisfied with the costs, the Bruneian government sought the intervention of Ministry of Health of Singapore, which started the disciplinary proceedings. The Court thoroughly examined the 94 charges against Dr Lim and found that her fees charged were “grossly excessive and vastly disproportionate to the services actually provided”.1 The Court of Three Judges eventually agreed with the Disciplinary Committee (DC) in finding Dr Lim liable for professional misconduct2.

The decision sets out clearly that there is an ethical obligation on all doctors in Singapore to charge a fair and reasonable fee for their services, given the “immeasurable trust and confidence bestowed on them both by patients and by community at large”.3

A few questions are worthy of consideration.

WHAT IF THE PATIENT AGREED TO THE MEDICAL COSTS?

In the present case, there was no fee agreement between Dr Lim and the patient. However, suppose a doctor clearly communicated with the patient of the medical costs with clear documentation and the patient agreed to the costs. Can the doctor still charge a higher price than the market rate? The Court states a firm no: Overcharging can still occur even if there is a prior agreement on fees4 as ethical obligations of a doctor must “prevail over contractual obligations”5.

WHAT IF THE DOCTOR IS EXPERIENCED OR IS THE BEST IN HIS OR HER FIELD?

The answer given by the courts? The doctor could not overcharge nevertheless. It seems straightforward. However, it may not be easy to tell in practice. This may be more clear-cut for simple procedures, which have a standard fee range for public and private hospitals. In the present case, Dr Susan Lim clearly overcharged over than a few times than the market rate for simple procedures which do not require her expertise or skills. The DC found that Dr Lim was not treating the patient in her specific field of specialisation, i.e. as a general surgeon but instead her treatment was palliative in nature and she was “coordinating treatment rendered by other specialists”6.

However, when it comes to complex surgical procedures which did not arise in the present case, it may not be as straightforward. It is hard to put a price on something intangible yet valuable like an experienced doctor’s skill. Certain factors such as his qualifications and years of practice can only serve as criteria.

Further, it seems imperfect to compare one experienced doctor to another. Do we take reference from the best in the field and adjust downwards? Who then determines what the best doctor in the field can charge?

These are difficult questions to ponder upon, especially when no fee guidelines are given.

SHOULD THERE BE A FEE GUIDELINE?

Fee guidelines have been introduced in 1987, but were scrapped in 2010 after Competition Commission of Singapore (CCS) deemed them to be anti-competitive.7

It should be noted what constitutes a fair and reasonable fee for services rendered depends not only on the relevant facts but also on views of experts in the particular field of practice.8 However, it was argued by Dr Lim that the views of experts were so varied that it would be impossible to determine a fair and reasonable fee, especially without fee guidelines. However, the Court disagreed and stated that it must be at the very least possible to determine the possible range of fees fair and reasonable in a particular set of circumstances.9

The Court suggested an approach of improved pricing transparency to arrive at fair and reasonable fees for medical services.10 This suggestion appears to be taken up by hospitals. From 2 Sep 2013, Ministry of Health has published percentiles of bill sizes for each procedure for public and private hospitals.11

However, many doctors in private and specialist clinics still face a problem: What is this proverbial ‘ethical limit’ decided by the Court? It has led to a number of doctors calling for a revisit for such a guideline. They called for the Academy of Medicine, Singapore Medical Association and the Health Ministry to come together to provide answers to the perplexing question of what the ethical limit is12.

Some doctors have revealed which factors they use to determine the size of their bills, in the wake of this case. Public sector fees, insurance payouts and peer pressure all help them to gauge the ethical limit on how much specific services should cost13. However, as a doctor pointed out, it would be “near impossible” to know where the lines are drawn in the absence of specific guidelines14.

But before we bring back the guidelines, the CCS’s concerns must be addressed. Law don Burton Ong pointed out that the CCS did not condemn all professional fee guidelines per se. He proposed a rephrasing of the guidelines such that it will be structured for patients, not doctors. This could then serve as “an objective and rational benchmark for ascertaining when and if doctors should be sanctioned for overcharging their patients”15. This suggestion can possibly be taken up.

LOOKING FORWARD

However, as the details of an ethical limit are being worked on, we can consider a suggestion. The lawyer profession has been alluded to in the Court judgment. Like doctors, lawyers also have a duty not to overcharge their clients. Similarly, the legal profession does not have written price guidelines. Perhaps the medical profession can consider drawing from the Legal Profession (Professional Conduct) Rules.

For example, Rule 35 of the Rules sets out sub-rules which require the lawyer to inform the client of an estimate of fees and to inform of approximate costs every 6 months. If the final amount varies substantially, the lawyer must advise his client of the change in circumstances in writing. Rule 36 further requires the lawyer to advise the client of costs at the outset of a contentious matter so that the client is aware at the outset of costs and risks of civil litigation.16

Similarly here, doctors can inform patients on their conditions and costs of procedures at the outset, particularly what to expect at different stages of treatments. If there is a change in the patient’s condition, the doctor should likewise advise the patient and his family necessarily. Certainly, this suggestion may not be directly transferable to the medical context and one needs to possibly consider issues such as patient confidentiality and medical ethics.

In practical terms, the above suggestion may work. Often a complaint against a doctor only arises when the patient feels something is amiss or the final costs are far from what he expected. Thus, if the final costs have been communicated right from the start and there was mutual consent, such complaints might not arise in the first place. This is what Dr. Susan Lim has not done satisfactorily, which led to the Bruneian Government launching the complaint.

However, this does not stop cases where a patient changes his mind and turns around to state that the price was outside of the ‘ethical limit’ despite the earlier agreement. After all, this seems to be what the Court is saying: even if there is an agreement, a doctor cannot charge beyond the ‘ethical limit’. The earlier suggestion can do so much as to minimise the numbers of complaints arising. However, doctors in the above scenario need not be overly concerned as the ethical rule is ultimately one rooted in “logic, common sense, justice and fairness … [and] will not be enforced unreasonably”17 as the Court rightfully noted.

When a complaint is launched, a series of investigations will begin. While there is now an ‘ethical limit’, it is submitted that in practice, the SMC will probably only commence disciplinary proceedings if there has been an egregious disregard for the Ethical Code and Guidelines or exaggerated overcharging of fees, as in the present case. As the Court stated, “one’s peers will be slow to find a breach or to find professional misconduct in marginal cases”18.

RELOOKING THE PENALTIES?

 A final point is regarding the sanction meted out to Dr. Lim. The DC has found that Dr Lim has breached her ethical obligation by the “widest and clearest margin” and meted out the maximum financial penalty of $10,000 and the maximum suspension period of 3 years. Yet, the DC felt that it was not appropriate to remove Dr Lim from the register as she has displayed exceptional care to the patient and was an “exceptionally skilled doctor who brought credit to Singapore”19. However, the penalty of $10,000 seemed a slap on the wrist considering the huge quantum of fees Dr Lim invoiced. This sentiment is likewise expressed by the Court20. While the maximum penalty has now been raised to $100,00021, it is submitted that the Disciplinary Tribunal can exercise its discretion under Section 53(2)(h)22 to order the disgorging of profits back to the patient in future cases if that proved necessary. The Tribunal may also consider making a Community Service Order, drawing reference from the Community-Based Sentencing (CBS) options provided in the Community Court. This can be useful, following recent calls for more pro bono work in the medical sector23.

In addition, the disparity between a maximum 3-year suspension and a lifelong erasure from the register seemed huge. Thus, the Legislature can consider increasing the maximum suspension period. However, in practical terms, the 3-year period may already have a significant impact to the doctor’s clientele.

CONCLUSION

In all, the decision has been helpful in clarifying that there is indeed an ethical obligation by doctors not to overcharge and that obligation triumphs over all other contractual obligations. However, the ethical limit one can charge still remains arbitrary. It is best that medical associations and boards can come together to clarify this, ideally via fee guidelines. Associate Professor Burton Ong’s suggestions can be considered as we reintroduce the fee guidelines. Finally, the Legislature and the Disciplinary Tribunal can consider relooking the penalties and orders they can make in future cases.


*Special thanks go to Yeoh Jean Ann and Benjamin Kwok for their invaluable comments. All opinions and errors remain solely my own.

[1] Susan Lim Mey Lee v Singapore Medical Council [2013] SGHC 122 at [86]

[2] Under the Medical Registration Act (Cap 174, 2004 Rev Ed). It was the earlier Act which applied instead of the current Act as the misconduct occurred before the amendments were made by the Legislature.

[3] Supra note 2 at [52]

[4] Ibid at [50]

[5] Ibid at [64]

[6] Ibid at [74]

[7] Competition Commission Singapore, Media Release, (19 August 2010). Also see Lim Meng Kin, “Medical fee guidelines anti-competitive”, Health Policy Monitor, October 2010.

[8] Supra note 2 at [53]

[9] Ibid

[10] Ibid

[11] http://www.moh.gov.sg/content/moh_web/home/costs_and_financing/HospitalBillSize.html

[12] Huang Shoou Chyuan, “Revisit need for fee guideline”, The Straits Times Forum (4 July 2013)

[13] Poon Chian Hui and Bryna Singh, “Doctor’s charges: How high is too high?”, The Straits Times (3 July 2013)

[14] Ibid

[15] Burton Ong, “Fee guides: Focus on patients, real charges”, The Straits Times (17 September 2013)

[16] Yashodhara Dhoraisingam, “Understanding a Lawyer’s Professional Duty to Provide Clients Information on Fees”, The Law Gazette (January 2005)

[17] Supra note 2 at [70]

[18] Ibid

[19] Ibid at [142]

[20] Ibid

[21] Section 53(2)(e) of the current Medical Registration Act

[22] This section provides: “make such other order as the Disciplinary Tribunal thinks fit, including any order that a Complaints Committee may make under section 49(1)”

[23] “Time for more to do pro bono work”, The Straits Times (18 December 2012)