Transparency of perks and fees

 

Consultants in private practice are being ordered to be more transparent. So what will that mean in practice? Leslie Berry gives the low-down

Back in the Spring of 2014, the Compet­ition and Markets Authority (CMA) published its final report into the private healthcare sector.

This included a range of ‘remedies’ to alter the market to put right the ‘adverse effects on competition’ the authority said it found.

In reality, that was not the end of the impact on the industry, but the end of the beginning. Now the hard work continues to consider how to effect the changes that the CMA requires.

Everyone is still working out what the report really means in reality. But, for our new readers and any who missed the CMA’s report, it looks set to affect consultants in the following ways.

There are four key areas where specialists will need to adapt their practices to ensure they comply:

1. Transparent publication of consultants’ financial interests in facilities;
2. Transparency of consultant fee information;
3. Transparency of clinical performance information;
4. Restriction on certain benefits and incentive schemes.

1. Transparent publication of consultants’ financial interests in facilities

As and when the order takes effect, hospitals will need to publish on the hospital website a list of all consultants who have a financial interest in either the hospital or specific equipment in that hospital.

2. Transparency of doctors’ fee information

In order to allow patients to make informed choices about their treatment, the doctors that they will be treated by and the hospitals where their treatment will take place, the CMA requires transparency of quality and price data.

The changes will mean that consultants will be required to provide patients with written confirmation of:

 The cost of outpatient consultation – either a fixed fee or hourly rate and maybe a range;

 Details of their financial interests in the facility where treatment takes place;

 A list of all insurers which recognise that consultant;

 A note advising insured patients to check terms of their policy with their insurer;

 After the outpatient consultation, a written quote and confirmation of diagnoses in advance of further treatment or tests – but not if this will take place on the same day.

In its current form, the CMA’s obligation requires that consultants must comply with the above as a condition of being granted practising privileges.

3. Transparency of clinical performance information

From September 2016, private hospital operators will need to provide patient episode data to an information organisation – most likely the Private Healthcare Information Network (see feature on page 14).

The reported metrics include:

 Volume of procedures undertaken;

 Average length of stay;

 Clinical indicators (infection rates, re-admission rates, revision rates, mortality rates, hospital transfers and adverse event rates);

 Patient satisfaction/feedback;

 GMC number of consultant;

 NHS number of patient;

 Diagnostic coding.

4. Restriction on certain benefits and incentive schemes

To ensure that competition for patients is based on quality of care without perverse financial incentives, this remedy aims to remove what are considered inappropriate incentives to clinicians.

High-value services:

Hospital operators who provide services such as consulting rooms, secretarial and admin services to consultants will be required to do so at full open market value.

Where consultants provide services such as consultancy or advisory services to private hospitals for a fee – such as chairing a committee or being a medical director – the fee must be reasonable and proportionate, and may also be required to be disclosed on the hospital’s website.

Low-value services:

After comment from a number of industry players, hospital groups have convinced the CMA that some low-value services should be allowed, such as:

a) Services intended to ensure clinical safety – for example, relevant training;

b) Workplace basics such as free tea/coffee/snacks while working, stationery and free parking – as long as also available to all staff;

c) General marketing of the hospital, such as general promotional events and consultant directories;

d) Corporate hospitality not tied to referrals. If over £500, it must be published on the hospital’s website.

Hospitals must disclose on their websites if they provide these ‘de minimus’ services to consultants.

Consultant equity participation:

Consultant equity participation in hospitals or joint ventures (JVs) for facilities or equipment will be prohibited.

But some exemptions will be made on the following basis:

a) The consultant subscribes to a fair market value and pays up front for equity in the hospital or JV (this provision will not have retro­spective effect);

b) The consultant owns 5% or less of the equity;

c) There is no requirement on the consultant to practise at the facility or to refer patients or to use specific equipment;

d) Dividends/profits must be shared on a pro rata basis in proportion to consultant’s stake;

e) No non-compete clauses are enacted;

f) Details of the consultants’ financial interests are disclosed on the hospital website.

The final CMA order out earlier this month (October 2014) has at least made some of the remaining uncertainties clearer. Independent Practitioner Today will be keeping you up to date with developments and their implications for private practice.