Health insurers fight to contain rising costs It's well known in the international arena, unfortunately, that fraud is commonplace. The problem is managing fraud without upsetting people. If you accuse someone of fraud you've got to be pretty sure you are right. A lot is pretty undetectable, or would create a lot of issues before you could take it further. Does it come from hospitals? From doctors? Policyholders are not out of the frame. In one case currently under investigation by InterGlobal, a customer submitted bills from a non-existent hospital. Mr Weigall continued: "If we did our checks it looked as though that hospital existed. I don't want to go into detail but suffice it to say we'd prosecute anyone we caught. UK-based international insurers William Russell point a finger at surgeons. They are mainly responsible for the wide variations in hospital fees. Charges by anaesthetists, nurses or routine "hotel" fees play their part but are overshadowed by discrepancies in surgical pay, according to the insurer. One Hong Kong-based surgeon recently demanded US$42,000 as his fee to carry out a knee replacement - a sum that would make even most Harley Street doctors turn a little green. Nichola Duncan, William Russell's international claims manager, said: "We contacted three other well-known surgeons locally and the average fee was US$24,000." The case highlights the value of requiring policyholders to contact their insurer before treatment. Ms Duncan said: "The first thing about pre-authorisation is that it lets the customer know that he is going to be reimbursed for the claim. But it also allows us to obtain cost estimates for the procedure and associated charges - and make an estimate as to whether that would be reasonable and customary in line with what would be charged in that area. When a surgeon persists in charging unreasonably, the insurer's medical officer would examine the case. "We'd possibly approach the surgeon directly and ask him if there were extenuating circumstances and if we didn't feel the fee was justified we'd invoke the 'reasonable and customary" rule." But usually, she said, surgeons would only reduce the fee when asked by the patient. However, it is important to bear in mind local factors and standards of care. Ms Duncan continued: "It's always in context with the region they are in. We're not going to compare the cost in Indonesia with Singapore because the level of care and standards are completely different. Our policy states that if we don't believe the charge is reasonable and customary we'll go out and obtain quotes for the same procedure for the same standard of care. We'll take an average and say, right, that's what we will pay. "The client then says 'OK I'll pay the difference" or they might have a chat with the surgeon and say his fees are unusually high, and the surgeon may agree to reduce his fee as a gesture of goodwill for the patient." She added: "Or the patient says he's not prepared to pay, he wants the insurer to cover in full and the surgeon won't lower his fee. The patient may get referred and have the treatment elsewhere. One economy that insurers can request when policyholders are being treated in some places is to opt for a shared room, rather than a single private room. That can almost halve prices because taking a shared room not only reduces the "hotel" rate but a range of other, unrelated, costs. Ms Duncan explained: "In Hong Kong if you go for a ward, that's the cheapest and everything across the board is lower cost, compared to having a private room - consumables, the hospital fees, the nursing fees." Because of the high charges for single room in Hong Kong and Singapore, William Russell offers customers a premium discount in exchange for taking up a shared room option. There seems to be no end to the ways hospitals load charges and no end to the means insurers use to combat the moves.