KMUH, 2 other hospitals slapped with hefty fines for fraud

The DOH decided to suspend the national health insurance (NHI) contract with KMUH's Department of Obstetrics and Gynecology for one year unless it pays the fine, which was the amount the hospital claimed from DOH's Bureau of National Health Insurance (BNHI) last year.

The contracts with the surgery department at DOH's own hospital in northern Keelung City and the Municipal Hsiaokang Hospital in Kaohsiung will also be suspended for one year and three months respectively.

They have to pay fines of NT$80 million and NT$13 million if they want to keep the contracts.

The case involving KMUH, formally named the Kaohsiung Medical University Chung-Ho Memorial Hospital, is the severest disciplinary action ever taken by the DOH targeted at hospitals with mismanagement and embarrassing scandals since the inception of the NHI program in 1995.

The shock waves sent to the medical community have not ended. DOH officials said more hospitals and doctors are still under investigation for the scams.

BNHI chief Cheng Shou-hsia said the prime suspect, Hsu Shih-cheng, a former director of the Department of Obstetrics and Gynecology at KMUH colluded with a fraud ring headed by Fu Chien-shen during Hsu's tenures at the hospital and at the Kaohsiung Municipal Hsiaokang Hospital.

The fraud ring managed to work with 10 hospitals, seven doctors and 20 patients to claim payments from the BNHI and compensation from insurance companies.

The matter only came to light because one doctor turned himself in and reported the scam.

According to Cheng, the doctors made arrangement to switch cancer patient specimens and let “phony” patients undergo chemotherapy treatment as well as surgery, in order to claim reimbursements from the BNHI.

Certain people were planted to purchase insurance policies and then disguised as patients to used the fake diagnoses to apply for payment from commercial insurance companies.

DOH Minister Yaung Chih-liang said the point is not so much about “fraudulently claiming health insurance reimbursement, but about the fact that doing so is a serious violation of medical ethics.”

The BNHI decided to terminate its contract with the Department of Obstetrics and Gynecology of the KMUH. But on consideration of the rights of the hospital's ob-gyn patients, the DOH will allow the hospital to pay a fine of NT$150 million in lieu of the termination of the pact.

A spokesman for KMUH insisted that the case was simply a fraud by a single doctor and the hospital is itself a victim of the scam.

He said Hsu left the hospital in May 2009, but before that date, the hospital was unaware of him claiming insurance reimbursements according to his diagnosis.

“The hospital regrets the ethical breach of the individual doctor,” he added.

He said the hospital has decided to appeal the case through administrative relief.

But the spokesman stressed that the hospital has tightened its administrative procedures to prevent repetition of any scams.

Prosecutors in Kaohsiung said they will summon Hsu again soon in the ongoing investigation.

Medical reform groups said they cannot accept KMUH's statements to separate the responsibilities of the management and staff.

They said hospitals should constantly review staff performance and eliminate the unqualified ones.

As the supervisory agency, DOH should also take measures to offer special contracts to medical institutions holding high ethical standards with outstanding performance, they added.

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