Albert Francis E. Domingo, MD

my flight of ideas

How much is that doctor in the window?

Posted on | September 5, 2013 | No Comments

Kim Henares, head of the Philippines' Bureau of Internal Revenue, fires an automatic rifle during target shooting practice. Photo: Bloomberg, as posted in

Kim Henares, head of the Philippines’ Bureau of Internal Revenue, fires an automatic rifle during target shooting practice. Photo: Bloomberg, as posted in

Commissioner Kim Henares of the Bureau of Internal Revenue (BIR) has declared, in several press releases on a supposedly forthcoming revenue memorandum, that practicing professionals will soon be required to post the rates of their professional fees in their offices or clinics. It seems from Henares’ pronouncements that this new requirement is intended to address “complaints that some doctors charge additional fees whenever a patient asks for a receipt”.[1] The immediate reaction of a significant number of practitioners (mostly doctors and lawyers) has been to vilify the chief tax collector. Interestingly, tax collectors in the ancient biblical sense have always been unfairly lumped together with prostitutes and other sinners. But that is for another piece.

From a purely computational perspective, posting the price or rate per consultation does help tax collection. It takes away the ability of the professional to invoke variability when it comes to the tax base by which the BIR shall assess. For example, when the tax assessor asks doctors and lawyers now, s/he cannot easily question the practitioner as to income because the practitioner will invoke variations in pricing. If there is a posted standard numerical rate, all the tax examiner will have to do is to estimate the number of patients/clients seen, and multiply that quantity by the standard rate. Hence, a projected income figure can be used as the tax base. Of course, the actual price determination or “pricing” itself is not so simple.

There appears to be a potent and complicated mix of issues behind the BIR’s policy thrust upon service professionals, and it is touching raw nerves – nay, the bottomline: personal incomes, along with the variety of perspectives on being compensated.

First let us ask ourselves: do noble and altruistic “I like to help people” intentions have a price in the market? The most passionate of healers and advocates will reply with a resounding “NO!” – followed by the qualifier that while helping others should not be the subject of money, the helpers have to pay for the costs of living, too. Thus it becomes a matter of how professionals see compensation, and the popular and probably ideal perspective is that it should only be incidental to one’s practice – not the primary goal of curing diseases or advocating for justice. There may be commendable individuals out there who practice medicine or law without regard for fees or compensation – but they are extreme examples well outside the norm.

That is where the codes of ethics of the professions come into play – and while they are written in plain English, the relative provisions on pricing one’s services can in reality be quantified. For both doctors[2] and lawyers[3], there seems to be four common factors in the determination of professional fee (PF) rates: 1) the patient or client’s ability to pay, 2) the difficulty of the case, 3) actual time spent by the practitioner, and 4) the professional standing and skill of the provider. There is no prohibition in the world of both professions as to waiving PF or charging a patient/client nothing.

In the ideal world as the BIR would want it, all transactions between and among citizens should be covered by receipts – as in all transactions, whether or not a fee was paid. I say this after hearing Henares over TV (UKG, Channel 2) this morning, September 5. She said that if a doctor wanted to discount or waive his or her rate, then such fact should still be noted in the receipt: write down first the standard rate, then write down the discount (or waiver), then write down the final price charged – even if it is zero.

Most apprehensions as to the posting of PF rates however are centered on a client or patient’s appreciation of value. Because of the many computational factors used to determine one’s PF, a Peso will not be able to buy the same “value” or quality of service across two different practitioners. Given the asymmetry of information in both the medical and legal fields, it will be hard for a patient or client to properly attribute the value behind the standard posted prices of professionals.

Does this mean however that patients and clients should forever be subjected to the on-the-spot and arbitrary pricing decisions of doctors and lawyers (or their secretaries, as is widely practiced) at the point of contact? Should it not be seen as the empowerment of patients and clients if they are able to determine beforehand the financial risks involved as they avail of professional services? This is of course based on the assumption that PF rates are properly adjusted according to the quality of services to be received.

Perhaps the most graphic resistance to the idea of posting rates is the fear of cutthroat, palengke (wet market)-like competition between and among providers. This is intimately linked back to the time-honored and sanctified principle that the medical and legal professions are service professions not primarily geared towards profit. But if we really are “friends of mankind” as doctors would say, then we had better review that market competition is intended to benefit the purchaser of services – the patients and clients – because providers should compete by offering the best possible service at the lowest tolerable price. Assuming the absence of market failures, competition should benefit patients and clients because doctors and lawyers will have to hone their craft in order to provide value for the PF that they charge.

Furthermore, it will not be a palengke kind of competition because as the BIR clarified, the PF rates will only have to be posted at the point of service – inside the office or clinic reception areas. Apprehensions as to the ethics of advertising (it is strictly regulated almost to the point of prohibition for both doctors and lawyers) should not be of concern, because large signboards and placards saying “SALE!” or “DISCOUNT!” are not what the BIR have in mind – at least based on the TV interview of Henares. Besides, as readily admitted by some doctors and lawyers, their secretaries will readily answer queries from prospective patients/clients as to how much will be charged for PF.

One last point – is this a matter of doctor-patient or attorney-client confidentiality? The closest provision for doctors as to doctor-patient confidentiality reads thus: “The physician should hold as sacred and highly confidential whatever may be discovered or learned pertinent to the patient even after death, except when required in the promotion of justice, safety and public health”[4]. For lawyers, the general rule is that “[a] lawyer shall preserve the confidence and secrets of his client even after the attorney-client relation is terminated”[5].

Attorney-client confidentiality is one of the concepts being invoked by lawyers in assailing the BIR’s proposal to have PF rates posted. Some have argued that as contained in jurisprudence, even the very identity of a lawyer’s client cannot be revealed[6]. A question comes to mind, however: is the information on the lawyer’s PF rate or price germane to the content or quality of the legal advice or opinion s/he is delivering to the client? Because if it is held to be so, then would that not violate the rule that “[a] lawyer who accepts the cause of a person unable to pay his professional fees shall observe the same standard of conduct governing his relations with paying clients”[7]?

In any case, BIR Commissioner Henares’ proposal to have lawyers and doctors post their standard rates, while couched in terms of tax collection efficiency[8], unwittingly opened the undeniable reality that even “noble” professionals have to learn proper pricing – like it or not. However, it is not the BIR who should facilitate the proper discussion or consultation regarding how doctors and lawyers should determine their PF rates. It is high time for the professionals, led by their respective governing institutions (maybe the DOH and/or PRC Board of Medicine for doctors; IBP for lawyers), to squarely address the all too often taboo topic of correctly pricing one’s services.

[1] See (accessed September 5, 2013).

[2] Art. II, Sec. 7, Code of Ethics of the Philippine Medical Association. See (accessed September 5, 2013).

[3] Canon 20, Rule 20.01, Code of Professional Responsibility of the Integrated Bar of the Philippines. See (accessed September 5, 2013).

[4] Art. II, Sec. 6, Code of Ethics of the Philippine Medical Association. See (accessed September 5, 2013).

[5] Canon 21, Code of Professional Responsibility of the Integrated Bar of the Philippines. See (accessed September 5, 2013).

[6] Regala v. Sandiganbayan, G.R. No. 108113

[7] Canon 14, Rule 14.04, Code of Professional Responsibility of the Integrated Bar of the Philippines. See (accessed September 5, 2013).

[8] Henares may be simply reacting to the practice of some professionals of having two PF rates: one rate for clients not asking for receipts, and another rate for clients asking for receipts (which is usually artificially inflated). Having a posted standard rate will eliminate this practice of having two PF rates, because in the first place ALL clients should be issued receipts.

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