One of the stated objectives of India’s demonetisation move in November last year was to rein in unaccounted income, or black money. It succeeded, if only for a while, in at least one sector: healthcare. With the currency shortage, doctors were left in a quandary about how to receive ‘cuts,’ the informal shorthand for a kind of commission paid by hospitals, specialists and diagnostics providers to doctors who refer patients to them.
Soon, of course, innovative minds found a way around the problem. Cash payments were replaced by other tax-free rewards, like shopping vouchers, air ticket vouchers, and others impressive gifts. Gradually, cash returned into circulation, and so did the cuts economy.
What are cuts?
The code of ethics of the Medical Council of India states: “A physician shall not give, solicit, or receive nor shall he offer to give solicit or receive, any gift, gratuity, commission or bonus in consideration of or return for the referring, recommending or procuring of any patient for medical, surgical or other treatment. A physician shall not directly or indirectly, participate in or be a party to act of division, transference, assignment, subordination, rebating, splitting or refunding of any fee for medical, surgical or other treatment.”
Code notwithstanding, cuts have been the norm rather than the exception.
The receivers are typically general physicians, the kind we call a ‘family doctor.’ GPs generally attract loyal patients from their neighbourhoods, and they tend to be affordable. Though the class as a whole is under siege from a slow shift towards patients consulting specialists, they still command a strong hold on the minds of their patients, who would tend to unquestioningly go to the specialists and testing facilities these doctors recommend. For hospitals, specialist doctors, diagnostics centres — especially newly established ones — it pays to cultivate the GPs.
Typically, a referring doctor asks for 30% to 40% of a patient’s bill. The percentage varies based on the number of referrals and the locality; the popularity of the referring doctor is a significant factor too.
In private, for-profit hospitals, there are even designated staff to keep track of commissions for outside doctors. “How else will they ensure good numbers in the performance graph?” a surgeon with his own practice in Andheri, who asked not to be named, says. He cites the example of a colleague who was fired for not ‘performing well’ by a hospital in Andheri. “Well-known corporate hospitals now have agents who go out to pay doctors for referring patients.”
The practice may seem harmless on the surface — many sectors and industries have legal commission systems after all — but it’s the end-users, the patients, who are underwriting this economy.
Fighting back
This year, a group of around 20 radiologists in Mira-Bhayander decided that it was a time to revolt against the system. In January, after several meetings and online discussions, the group made their stand public. They sent a letter to the Indian Medical Association (IMA) announcing that they will “only practise ethically, come what may.” They called themselves converts.
The daring stand did not earn the converts many disciples, or even hosannas.
“Instead, our practice went down by over 40%,” says Vikrant Desai, secretary of the Mira Road Bhayander Radiology Association. Dr. Desai has run a radiology centre in Mira Road for nine years. The reason, he says, is lack of unanimity. “There are nearly 25 individually-run centres in the area but we have managed to convert only about 80% of them. Since we stopped giving incentives, our business has gone to those who continue to offer cuts.” Dr. Desai says that some doctors from the group were considering shutting down their labs and seeking salaried jobs in hospitals instead. “When we were a part of this nexus, our lives were easy. Now that we have chosen to be against it, there is frustration and helplessness because we are against the majority in the fraternity.”
These radiologists weren’t the first to call out the under-the-table trade.
In 2014, Mahad-based physician Himmatrao Bawaskar filed a complaint to the Maharashtra Medical Council (MMC) against the N.M. Medical Centre in Sancheti Hospital, Pune. The centre had sent him a cheque of ₹1,200 for ‘professional services’ after a patient he referred had a CT scan there.
Dr. Bawaskar points out that cuts aren’t just a Mumbai phenomenon. “It was earlier common only in the urban areas,” he says, “but now it has gradually seeped in to the district and taluka levels as well.”
The kind of action that Dr. Bawaskar and the Mira-Bhayandar doctors want taken is not unprecedented either.
Also in 2014, the MMC issued a show-cause notice to the Kokilaben Ambani Hospital after it was found offering huge incentives — from ₹1 lakh to ₹2.5 lakh, depending on the number of admissions — to referring doctors.
“There is definitely plenty of give and take in cash and kind,” says Sanjay Oak, director of the Prince Aly Khan Hospital. “The problem is that because of such an evil practice, [honest] doctors get affected and so do patients.”
Exigencies and justifications
Without condoning cuts, it isn’t hard to see how the system has taken root and flourished.
A medical student spends four-and-a-half years in a MBBS course, followed by one year of internship. A post-graduation degree of MD or MS takes three more years and a super specialty takes another three years. A student has to spend a year as a special medical officer of a Super Specialist Medical Officer in a government hospital depending the degree he is pursuing. In between, a year is required for examinations and some students may even take small breaks.
A recent media report said that a four-and-a-half-year MBBS degree in a deemed university costs more than ₹1 crore. When a doctor is ready to set up private practice, he is eager to recoup that money, and the cuts are certainly an easy option to take. Krishnakant Dhebri, a family physician who has practised in Girgaum for the past 37 years, says that there is no denying that the practice exists. “but it will be wrong to say that only general practitioners are the culprits. If it exists, it is across the board.” Dr Dhebri reasons that “extreme competition” fuels it all.
The ones who give cuts have their reasons too.
A specialisation means an investment of even more time and money than a basic medical degree. By the time a doctor with a super-specialty degree starts earning fees, whether in private practice or as an employee of a hospital, she is nearing 35 and would tend to have a family to take care of. Specialists don’t usually get patients walking in off the street. She rarely has the luxury of slowly building up a reputation — and referrals solely based on that reputation. The family investment in must be recouped (or education loans must be repaid).
There is, of course, the question of pay. Head of cardiology at Parel’s KEM hospital, Dr. Prafulla Kerkar, said there is a huge disparity between pay scales of public and private hospitals. “The earnings of doctors are disproportionate to the number of years put into medical education and the money invested by those who go to private colleges,” said Dr. Kerkar, who completed his super specialty in cardiology at the age of 31. “But it all depends on one’s conscience. One can practise without giving cuts by accepting the long waiting period to make money.” Besides being a full-timer at KEM, he opted for private practice after routine hours to make a little more money.
Then there are the diagnostics facilities. No one gets an MRI or even and X-Ray or blood count on a whim. These centres only get customers when a doctor advises a patient to get one. And getting into the business is an expensive affair. To start a diagnostics centre today, a radiologist would need to invest more than ₹50 lakh. (Basic X-ray machine, ₹5 lakh; digital X-ray machine ₹7 lakh; ultrasound machine, close to ₹15 lakh; then there is rent, or EMIs for a loan, interiors, office equipment, staff salaries.)
All this is after spending years and rupees getting a qualification. Business had better pick up quickly.
“When I set up my practice 12 years ago, I failed to get a single patient at my centre for days,” says Ashok Patil (name changed), a radiologist who practices in central Mumbai “I distributed pamphlets with newspapers in the area but there was hardly any response. Finally, like a medical representative, I had to meet doctors asking them to refer patients to me. And then the first question they would ask is, ‘What’s the percentage of cut?’” Since then, Dr. Patil’s practice has grown enormously. “Now I have a goodwill, and patients come on their own.” Even so, he still pays cuts. “I have expanded my set-up, due to which the patient flow has to be maintained. From the local family physician to a senior surgeon who travels in a plush car and lives in a swanky high rise, everyone wants a cut for their services. Rarely have I found doctors who said that he or she will send patients to me for accurate diagnosis. Instead they gave me examples of how others had paid them hefty incentives that included gift vouchers, hotel stays and even holidays for giving them good business.” Dr. Patil says GPs and corporate hospitals are fuelling the practice, and if the government really wants to crack down, they are the ones who should be targeted.
An injection of hope
On May 25, a hoarding went near the international air terminal. It said, ‘Honest Opinion. No Commission to Doctor.’ with a logo of the Asian Heart Hospital below.
Dr. Desai of the Mira-Bhayander group spotted it, and got in touch with AHI’s director, Ramakant Panda, who as it turns out, is the brain behind the billboard. “It was like a ray of hope for us,” Dr. Desai says. “We were after all small-time doctors. But when Dr. Panda took up the same issue, we gained certain level of confidence.”
Dr. Panda’s campaign certainly got the eyeballs. But it also set off a severe allergic reaction within the medical fraternity. Many doctors are upset about the method that Dr. Panda chose to bring the matter to light.
“It was nothing but an attention-seeking gimmick,” says Jayesh Lele, national secretary of the Indian Medical Association’s hospital board. “By trying to project himself in good light, Dr. Panda has done much harm to the medical fraternity.” Dr. Lele feels that Dr. Panda’s bringing the ethical transgressions of the industry into the public eye is unethically promoting his hospital. “What the point of the advertisement? Does it mean that except AHI doctors, all others are in the wrong?”
The IMA and the Association of Medical Consultants wrote to Dr. Panda stating that his campaign was in “poor taste.” But Dr. Lele does say that they will support the State government, which has formed a committee to brainstorm on an anti-kickback law on the lines of laws in some other countries.
An opinion piece in the British Medical Journal by two Indian doctors, Sanjay Nagral from Mumbai and Samiran Nundy from Delhi, called Dr. Panda’s actions “courageous.” The article said, “things will only change when young Indian doctors who are first starting out in their practice, after investing large sums of money in their medical education and training, choose to do what is best for their patients notwithstanding financial considerations.”
