The truth about cash for referrals

The BMJ has learnt that representatives of a major health insurance company met with the General Medical Council in June 2012 to present evidence it had uncovered of doctors being paid incentives “in return for referrals and to encourage them to use facilities.”

At the same meeting the GMC was also alerted to a report that had just been published by the Office of Fair Trading. The OFT, which was referring the private healthcare market for an investigation by the Competition Commission, had also identified “direct and indirect financial incentives to consultants” that it considered were interfering with fair competition.1

The Competition Commission’s subsequent report, issued in April 2014, concluded that clinician incentives “might, despite [contractual] caveats relating to patients’ best interests, incline consultants to recommend treatment at a particular private healthcare facility rather than another . . . which may have equivalent or better facilities and/or which may be more competitive on price.”2

Last October, the Competition and Markets Authority (as the commission had by then been renamed) issued an order prohibiting “any scheme or arrangement . . . which is intended to induce or may reasonably be regarded as inducing a referring clinician to refer private patients to, or treat private patients at, the facilities of a particular private hospital operator.”3

Despite this, there is evidence that some hospitals are continuing to attempt to “buy” referrals. One senior surgeon told The BMJ he had been approached by a hospital group hoping to attract his referrals away from a rival as recently as nine months ago—long after the Competition Commission’s …