Medical frauds by charities face severe penalties

The Ministry of Civil Affairs will strengthen oversight of nonprofit organizations that run medical assistance programs, and warned of severe punishments for those profiting from such programs, according to a circular released by the ministry recently.

The move followed scandals that some hospitals and enterprises, which claimed to offer charitable medical assistance, invited patients to "designated hospitals" where they were charged high medical fees, the circular said.

Beijing Youth Daily reported in September that Xinglin Care Fund, a charity authorized by China Charity Federation to help poor patients with cerebral palsy and epilepsy, lured them to a private hospital in Beijing with the promise of free treatment and a high success rate.

But many patients ended up spending up to 70,000 yuan ($10,100), the paper said.

The ministry said in the circular that profiting from patients is against the doctrine of charitable activities and will cause patients more harm.

To put an end to such incidents, the ministry asked local authorities to carry out an inspection for charities that run medical programs, especially those involving designated hospitals, according to the circular.

Channels should be open for the public to lodge complaints, and those facing complaints should be put under scrutiny, the circular said.

Those found to have forced or lured patients to buy medical services or products with higher than approved prices would face punishments including being blacklisted, it said.

The ministry also asked charities to assess their partner hospitals regarding qualification, price and feedback from patients, and make explicit who their beneficiaries are and what assistance they are entitled to, it said.

Charites were also asked to cut ties with hospitals that were found to increase medical fees arbitrarily or profiting from unnecessary tests.

Government oversight will also be stronger for programs that claim to help the poor, the aged, orphans or those who cannot afford schooling, the circular said.

Wang Rui, founder of Beijing Union Charity Foundation, a nonprofit organization helping rural patients with long distance medical consultancy, hailed the ministry's effort to crack down on such misdeeds, but said the ministry alone is not enough to solve the problem for good.

"Medical fraud is evil in itself, not to mention carrying it out in the name of charity. The fraudulent organizations should face criminal charges, not just punishments from the ministry," he said, adding he expects a joint operation from the ministry and the public security departments.