Monday, September 12, 2011

Doctors’ poison pill burns our pockets

It’s all well to talk about Bofors and 2G corruption. But what about the cuts taken by doctors who refer patients for tests and scans?  

In these heady days of Anna's triumphs, it is difficult to write about anything but corruption in India, and the subject is so vast, encompassing as it does every aspect of human activity, that the mind cannot think of other subjects on which to write.

Anna Hazare's campaign and the Jan Lokpal Bill have concentrated on corruption among government servants-the term extending from the prime minister to the lowest clerk in a tehsildar's office. This covers a wide swathe of economic and social activity of the people.

Corruption erodes the moral and ethical fibre of the bribe-taker and the bribe-giver. But this is not the worst effect of bribes, graft, kickbacks. The worst effect is that corruption is a cost of production. This is well-known, but few realise that it is the first axiom in the geometry of graft.

Bofors paid a bribe of Rs64 crore to some of the highest people in the land. We know who they were, but officially they were unknown and unnamed. Do you think Bofors wrote off the payment as charity? No way. The equivalent of Rs64 crore was added to the cost of the Bofors guns delivered to India. And who footed the bill? The people of India through the defence budget of the Government of India.

And let us take the tonnes of crores of graft paid in the 2G scam? Who will really reimburse the cost to the mobile phone companies? Who else but the users of the ultra-smart mobile phone services that the licensee companies will put on the market. It will be you and me; the man in the street may escape.

Let me take an example which affects all of us, including the man in the street, and the dog at the lamp-post:  the kickbacks taken by doctors who refer patients to scan centres and diagnostic labs. Yes, we put the haloes on the doctors' heads, but they are not shining white, they are black and baleful.

It all seems so simple and innocent, doesn't it? The general physician, or the specialist, examines your wife. He prescribes a scan and recommends a particular scan centre. He even has the centre's requisition pad with him and writes down your name and the investigations required.

You go to the scan centre and wince inwardly at the huge cost. But you think it is good for the beloved wife and you pay up; you notice it's all in cash. You take the scan to the doctor and the process continues.

You do not know that you have been cheated by as much 15% or 20% of the price of the scan. The doctor has an arrangement with the scan centre: up to 20% (depending on the number of referrals) of the value of the scan goes to the doctor as kickback. The amount of kickback is added to the cost of the scan, so your bill is bloated by that much more. Everyone's happy, including the patient who does not know. Ignorance is bliss, as the proverb goes?

I have written this on the basis of first-hand experience and a story that I wrote for my newspaper, about 15 years ago, detailing the entire process.

At the end of each month, the doctor sends to the scan centre, a list of patients that he has referred, the real cost of the scans and the total cut due to him. The amount is delivered in cash the next day. If it is not, the tap is turned off and the doctor starts referring patients to another scan centre. This keeps the scan centre owner in line.

I had written the story on the basis of written records, including the doctors' letters, the scan owners' record of payments, the cost of the scan before the kickback, the price charged to the patient and a few other bits and pieces of evidence.

Not surprisingly, nothing happened. One of the aphorisms I worked out is: today's newspaper wraps tomorrow's peanuts.

But I didn't give up. I sent the whole lot of evidence to the income-tax officer in whose ward the doctor fell. Again, nothing. And I thought of the saying: there are two types of people whom one does not antagonise, doctors and income-tax officers. Here the income-tax officer did not want to antagonise the doctor, who happened to be a neurosurgeon.

And nothing has changed.

(R Vijayaraghavan has been a professional journalist for more than four decades, specialising in finance, business and politics. He conceived and helped to launch Business Line, the financial daily of The Hindu group. He can be contacted at

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