Kaohsiung Medical University Chung-Ho Memorial Hospital in southern Taiwan has been fined NT$150 million ($4.75 million) for fraud on a massive scale, the Department of Health (DOH) said Tuesday.

The fine is the heaviest ever meted out to any medical institution for this type of violation since the "National Health Insurance" system was put in place in 1995.

DOH chief Yaung Chih-liang said the point is not so much about "fraudulently claiming health insurance reimbursement, but about the fact that doing so is a serious violation of medical ethics."

Cheng Shou-hsia, chief of the "Bureau of National Health Insurance" (BNHI), said the prime suspect, Hsu Shih-cheng, a former director of the Department of Obstetrics and Gynecology of Kaohsiung Medical University hospital, colluded with a fraud ring headed by Fu Chien-shen when Hsu was working at the Kaohsiung Medical University hospital and at the Kaohsiung Municipal Hsiao-kang Hospital.

The fraud ring worked with 10 hospitals, seven doctors and 20 patients to claim payments from the BNHI and insurance companies.

The matter came to light only because one of the seven doctors came forward and reported the scam.

As a result, the BNHI decided to terminate its contracts with the Departments of Obstetrics and Gynecology of the Kaohsiung Medical University hospital and the Hsiao-kang Hospital for one year and three months, respectively.

However, after considering a request by the Kaohsiung Medical University hospital for reconsideration of the punishment and the rights of the hospital's ob-gyn patients, the termination was changed to a fine of NT$150 million.

A spokesman for the hospital said Tuesday that the case was simply fraud by one doctor, that the hospital is itself a victim of the scam, and that it will file for administrative relief.

The spokesman said that Hsu left the hospital in May 2009, but before that date, the hospital was unaware of his dishonesty and had claimed insurance reimbursements according to his diagnosis.

"The hospital regrets the ethical issue of the individual doctor," he added.

China Daily/CNA

(HK Edition 04/14/2010 page3)