Nearly two million letters asking patients to participate in annual payment plans for uninsured services have been sent out over the signatures of 1,000 doctors, an investigation by Metroland West Media Group has found.

The doctors, whose rosters include patients in Hamilton, Halton, Guelph, Kitchener-Waterloo, Cambridge, Niagara and other areas, have contracted for the letters with a Toronto company set up to increase physician revenue.

Healthscreen Solutions Inc., a publicly traded medical management firm, says it can garner an average of $18,000 in extra revenue per doctor a year.

The money comes from charging patients for services such as sick notes, phone advice, insurance forms and faxing and photocopying not covered by the Ontario Health Insurance Plan (OHIP).

The letter explains that by paying one “block fee” or lump-sum payment annually, patients can avoid being billed individually for services delivered by the doctor outside of medicare.

It encourages patients to pay the fee even if they don’t think they will need the services. But patients are not told that the letters asking for up to $140 a year per family or up to $95 for singles are part of the operation of a Healthscreen service called CallerMD.

The company says it is following all federal and provincial privacy laws.

Healthscreen says the functions it performs are no different than the work a physician’s staff would do.

“Doctors authorize us to provide these administrative services on their behalf,” says Justin Belobaba, Healthscreen’s president and CEO.

He says Healthscreen does not disclose its involvement to patients because doctors who use CallerMD asked the company to stay behind the scenes.

“Patients and doctors just seem to be a lot more comfortable when we don’t brand everything as Healthscreen … and when we preserve the physician-patient relationship.”

The letters imply that patients signing up for the plan are communicating only with their doctors. In fact, their personal information — including financial information and other personal details from the doctor’s file — are going to a company which handles $1.5 billion a year in billing and other services for 5,000 doctors.

Block fees are not illegal, but have been a sensitive issue for years. Critics want them banned, but supporters say the fees are an appropriate way to compensate doctors for their time.

It is estimated Canadian doctors do not get paid for up to $2.5 billion worth of services a year not covered by medicare or private insurance.

Companies can act as doctors’ agents in recovering the fees, and a number have emerged in the last few years.

The “Dear Patient” letters requesting payments carry the name and address of individual doctors, a list of services and their charges.

CallerMD gives doctors the option of including a phone number that patients with questions can call. It does not belong to the physician, but is a corporate call centre, operated by Healthscreen.

The 1-800 number answers with a generic greeting of “medical billing office.” Belobaba says patients who call know that “they’re not speaking with the doctor’s regular assistant. We’re very open about it when people ask.”

When patients fill in a registration form attached to the letter, they give a credit card number or enclose a cheque. The information is mailed in a return envelope addressed to the doctor, but it goes to Healthscreen for handling.

Nowhere in the patient package is it disclosed that anyone but the doctor is involved. Patients who do not join the extended payment plan are billed individually for each service they use.

Those invoices are also sent from Healthscreen. Belobaba said 85 to 90 per cent of patients pay an invoice within 60 days, in part because the letter comes from the doctor.

“I think patients have a very special relationship with their doctor, as opposed to the relationship they have with pretty much any other service providers in their lives,” he said.

“And so, because of that respect, they’re more likely to pay the bills that come from their doctor.”

Privacy experts say the packages raise questions about transparency.

Fair information practices, the principles which underpin privacy laws across North America, say individuals should know who is collecting their personal information, where it is going and how it will be used.

The Ontario Information and Privacy Commissioner’s office says it can’t comment without full details about how Healthscreen operates and how the province’s Personal Health Information Protection Act might apply.

But spokesperson Bob Spence said that “if anyone believes their personal health information has been inappropriately collected, used or disclosed, they can file a privacy complaint with our office.”

Health Minister George Smitherman said he keeps a “very, very watchful eye” on the issue of block fees generally. If questions are being raised about disclosure to patients, he said he would consider reviewing the issue.

Healthscreen also uses OHIP and other health data to track the medical activities of patients, the Metroland investigation has found.

Healthscreen says that’s part of another service, called PrevCareMD, which helps doctors take advantage of provincial government incentives for preventive care.

Ontario has a $100-million incentive pool which offers up to $11,000 a year to doctors who make sure that a certain percentage of patients receive preventive procedures such as mammograms, colorectal cancer tests or flu shots.

The company says on its website that to identify appropriate patients, “we compile data sources including OHIP billing history, Ministry of Health reports, Ontario Breast Screening Program lists, and others to get the most up-to-date information.”

Staff in the Healthscreen call centre in Toronto then follow up by calling the patients of doctors who are clients. The “patient relations representative,” as these workers are called, tells patients about the need for such procedures and helps arrange appointments.

Healthscreen operates here “as an extension of the doctor’s office,” Belobaba says, noting that PrevCareMD merely makes arrangements a physician’s aide would do if they had time.

Belobaba says the company goes to “pretty extraordinary lengths” to keep information confidential, including biologically encrypted systems that require fingerprints for security.

Healthscreen takes 25 per cent of the money it gains for each doctor from the incentive pool for preventive care.

The company also retains about 20 per cent of the revenue each doctor takes in on block fee and individual payments from patients for uninsured services.

Karen Filice, whose mother-in-law got one of the extended plan letters, at first was taken aback by the thought of having to pay for phone prescription renewals at $15 each. When Metroland informed her the letter was part of an undisclosed company’s back-office system, she questioned how a doctor could get away without telling patients.

“If they want to charge and have something done like that then they should give full disclosure to people so they know what they’re agreeing to and who they’re releasing information to,” Filice said.

The Ontario government could change the rules immediately if it wanted, because Cabinet has the power to regulate block fees, a power it has never used.

The amount of the fees and how they are administered is governed by the Ontario Medical Association (OMA) and the College of Physicians and Surgeons.

But the 2004 Commitment to the Future of Medicare Act gives the Ontario Cabinet the right at any time to start regulating other elements of block fees.

This includes “the circumstances under which they (fees) may be charged and the information that must be provided to the person who is charged,” the act states.

The package to patients raises other important issues at a time when practitioners are struggling to cope with a critical doctor shortage, the de-listing of services, and the perceived failure of doctor compensation to keep pace.

The Healthscreen letter entreats patients to recognize that family doctors do not get paid by government for everything they do.

It suggests patients help the doctor, and save money for themselves, by paying for extended coverage.

“Even if you do not anticipate needing any of these services, by signing up for this plan you help to ensure that we will be able to continue to offer you the best in medical care during these difficult times for our health care system,” the letter says.

Margaret Somerville, founder of the McGill Centre for Medicine, Ethics and Law, likened this part of the appeal to “acting like a charity.”

“You’re sort of soliciting donations,” she said.

A principle of medical ethics is to make sure a patient feels free to say yes or no “without thinking they’ll suffer a detriment,” said Somerville.

“That kind of language would worry me in terms of a sort of coercive tone to the relationship between the patient and the doctor,” she said.

“Would a reasonable patient feel, you know, ‘If I don’t do this, the doctor’s not going to be as sort of caring for me or as available to me as if I do it?’”

Belobaba said that part of the letter should not be of concern.

He said he thinks patients “look for ways to show appreciation for their physician” and that paying block fees might be a way to demonstrate it.

For doctors, block fee payments help compensate them properly for the “frivolous” parts of work.

“The No.1 benefit that the users of CallerMD report to us is not income, it’s the time savings of half an hour to an hour a day that they used to spend on frivolous services,” Belobaba said.

The onslaught of extra duties in overloaded doctors’ offices has caused general practitioners to look for remedies and private companies to look for ways of doing business on doctors’ behalf.

Healthscreen’s business has been one of the beneficiaries of the trend.

In October, Profit ranked it No. 1 in the magazine’s ranking of 50 emerging Canadian growth companies, with a two-year growth of 5,000 per cent.

“What we’re saying is there’s a role that private companies can play in bringing a lot more efficiency to the health system, freeing doctors to do what they do best,” Belobaba says. “In the process, if we can generate more revenue for them and keep doctors from leaving the province — then we’ve benefited the system in general.”

One million Ontario adults and 130,000 children are without a family doctor today, five years into a crisis that had been predicted for more than a decade.

“All of us are constantly torn between wanting to treat more patients and offer care to people ... and realizing that if we overextend ourselves, we end up not providing good care to anyone,” says Dr. Ruth Wilson, president of the College of Family Physicians of Canada.

Many doctors rave about block fees.

Healthscreen has agreements with the Coalition of Family Physicians of Ontario, the Ontario Medical Association’s Section on General and Family Practice and several local academies of medicine to introduce CallerMD to the organizations’ members. Healthscreen and at least four other companies currently provide block fee billing systems for services in Ontario. Other companies straightforwardly reveal their involvement to patients.

For example, doctors who use Practice Solutions Billing Services, owned by the Canadian Medical Association (CMA), use a patient letter clearly stating that the company has been retained as an agent to manage the program.

Another company, Doctors Services Group, also tells patients in the initial block fee solicitation letter that it will be invoicing and processing payments on the doctor’s behalf.

* * *

the pros and cons of doctors’ block fees

Block fees — or annual payments — for services provided by doctors, but not covered by the Ontario Health Insurance Plan are not illegal, but definitely controversial.

Whether it’s a sick letter to a boss or a telephone call on test results, a doctor has the right to arrange payment when there is no OHIP fee to cover what the patient requests.

Supporters of the fees say doctors save administrative time and patients save money when there is an annual payment to cover all potential services. Patients still have the right to pay for individual services as needed rather than an all-inclusive annual fee.

But critics want the fees banned outright, saying patients shouldn’t be paying out of pocket if doctors aren’t being properly compensated, or are overloaded with paperwork.

cons

Critics say the fees:

• Violate the spirit of the Canada Health Act, which calls for access to services based on need, not wealth.

• Are difficult to control and regulate.

• Make some people intimidated and hesitant to complain, because they believe there is an implied danger of being dropped by the doctor if they don’t pay.

• Are unnecessary since doctors can already charge item by item for uninsured services.

• Should be partially refunded for services patients have not used.

pros

Advocates say the fees:

• Make sure doctors are paid for uninsured services they provide to patients.

• Give patients a more cost-effective payment option if they use a series of services.

• Are properly overseen by the medical profession’s regulatory bodies, notably the College of Physicians and Surgeons of Ontario.

• Provide doctors with extra revenue that can be used to hire help to service patients faster, like hiring an extra staff member to help with paperwork.