COA orders government hospital to lower lab fees

MANILA, Philippines - Stressing that government hospitals are supposed to offer affordable medical services to the poor, the Commission on Audit (COA) has called the attention of the Amang Rodriguez Memorial Medical Center (ARMMC) over the high cost of laboratory fees it has been collecting from patients.

State auditors said ARMMC officials should review its existing rules and contracts to address the issue.

The COA 2010 report said the ARMMC’s laboratory service fees are higher by five percent to 75 percent when compared to other hospitals retained by the Department of Health (DOH) and by 29 to 100 percent compared to the fees charged by private diagnostic clinics.

The COA report said the laboratory fees collected by the ARMMC, located in Marikina City, for “send-out” laboratory examinations also carry a markup ranging from 40 percent to 550 percent.

The high cost of laboratory fees for tests on blood, urine, stool and tissue samples is apparently due to a so-called “closed system” procedure wherein laboratory equipment are provided through tie-up agreements with certain suppliers without any cost to the hospital, according to the COA.

However, such deals carry a condition that the laboratory equipment would be procured exclusively from the suppliers.

“In this system and since the (ARMMC) purchased only its reagents from the said suppliers, the hospital can no longer avail of the supplies from other suppliers who may offer lower costs,” state auditors said.

The COA noted that in order for the ARMMC to attain its goals of providing quality but affordable health care to the poor, “it should have adopted a plausible but affordable system.”

 “We recommended that the laboratory section conduct a re-visit of the reasonableness of the fees currently being charged on laboratory procedures with due consideration on the rates offered by other government hospitals and private diagnostic centers,” the state auditors said.