THE health ministry is wasting hundreds of thousands of euros by paying commission to ‘middlemen’ in sending patients to two particular hospitals in Israel instead of going direct to the facilities themselves, the Auditor-general’s report for 2009 said yesterday.
Auditor-general Chrystalla Yiorkadji also questioned why a health ministry official recommended to one of the ‘middlemen’ companies to alter its books so that the commission paid would not leave a paper trail.
“Despite our service’s repeated suggestions to the health ministry to immediately go for direct co-operation with the hospitals …to cut expenses, it has been established that the ministry continues to cooperate with the specific companies,” report said.
According to the report, submitted to President Demetris Christofias yesterday, in 2008 a company, which represents one of the two Israeli hospitals, received in excess of €2.0 million from the Health Ministry with around €319,000 paid in commission.
The commission paid to a second company, which received over €1.5 million in patient fees, is unknown since it was not recorded separately on the billing statement, the report said.
In a recent memo, the head of the ministry’s department dealing with sending patients abroad, said it would be easy for the ministry to start dealing directly with the Israeli hospitals immediately, the report said.
It also questions why a health ministry official had suggested to the first company to change its billing statements to hide the amount paid in commission. The company has adopted the practice since 2009.
“Because our service does not understand the reason for this recommendation, it asked in December 2009 to be informed whether this was done with the authorisation of the minister or the permanent secretary. To date, no reply has been received,” the Auditor-general’s report said.
For 2009 the two companies were paid €2.1 million and €1.4 million respectively for treatments and commission, the report said.
It added that the ministry permanent secretary has said that contacts with the hospitals were on the cards regarding direct cooperation.
In 2009, Cyprus sent 2,051 patients for treatment abroad, at a total cost of €35.6 million
The report said there has been a significant rise in patient numbers and cost in recent years compared to 2006 when some 1,000 people were referred to foreign hospitals at a cost of some €25 million.
The Auditor-general said forging agreements with the hospitals, not using middlemen, better monitoring of patients and billing would result in lower costs.
“This is supported by the fact that the health ministry’s accounting department, at times, finds mistakes like double payments,” the report said.
The report highlighted the inadequate monitoring of patients’ treatments and hospital charges, which is mostly done by welfare officers seconded at various embassies.
The Auditor-general also said there were weaknesses in the referral procedures.
The recommendations regarding the medical centre the patient should be referred to, included in the committee reports, were not always properly explained. And in some cases when the committee recommended sending the patient abroad, the report lacked the necessary elements justifying why they did not follow the regulation of giving priority to the private sector in Cyprus.
