Jefferson Health has reversed a controversial policy that linked incentive pay for some doctors to referrals of patients to the hospital system’s fund-raising office.

For years, Jefferson and other hospital networks have engaged in what is known as Grateful Patient fund-raising, a practice of referring patients who have expressed gratitude for their care to the fund-raising office in the hope they will donate money. But some doctors at Jefferson balked earlier this year when the hospital linked those referrals to incentive pay. .

“After receiving internal feedback, Jefferson has gone back to the original grateful patient referral program which does not have an incentive component,” John Brand, Jefferson’s chief communications officer, said Thursday.

He said the decision to link grateful patient referrals to “a modest incentive for departmental chairs” was done “in an effort to advance the culture of philanthropy” and was modeled after programs at other medical institutions.

The reversal comes after The Inquirer reported in February that some doctors at Jefferson Health were being asked to refer at least one “grateful” patient each month to the system’s fund-raising office, which they said they were told could impact the size of their annual bonus.

On Friday, one of the Jefferson doctors who talked to The Inquirer earlier this year said physicians were pleased the policy was reversed but that it shouldn’t have happened in the first place.

After reading The Inquirer article in February, Steven R. Cohen, a Southampton psychologist and Jefferson patient, sent a letter to Stephen Klasko, Jefferson’s CEO, objecting to the incentive pay link. He also said he was pleased the policy was reversed.

“All patients should have the assurance that when they receive care the health-care provider is focused on the diagnosis and treatment and is not burdened by any conflicts of interest imposed by the employer,” he said Friday.

Cohen also said he hopes other hospitals are discouraged from adopting similar plans.

Also on Friday, Joseph Carrese, a professor of medicine at Johns Hopkins Berman Institute of Bioethics, who had been critical of linking incentive pay to patient referrals for fund-raising, called the policy reversal an important first step and the right decision ethically.

“I applaud Jefferson’s leadership for their willingness to listen to the concerns raised and then revisit their initial decision,” he said.

But he also said Jefferson and other institutions that engage in Grateful Patient fund-raising should commit to raising awareness and educating physicians, fund-raising officers, and hospital leaders about the ethical concerns and considerations involved.

“If that effort was already in place at Jefferson, this misstep might have been avoided,” he said. “And moving forward, future missteps … that could potentially damage the doctor-patient relationship or the institutional-patient relationship could be prevented.”

In February, Carrese had told The Inquirer: “It crosses into the territory of a frank conflict of interest, when you are tying a physician’s personal financial gain to the activity of securing money from their patient when [physicians’] primary obligation should be putting their patient’s best interest first and foremost.”

Two Jefferson doctors, who had described the changes earlier this year on the condition they not be identified because they feared retribution, had said some of their colleagues were worried the initiative could damage the doctor-patient relationship.

“There’s a widespread feeling among physicians at Jefferson that this strategy is not going to be fruitful in that it is unethical,” one said at the time.

Jefferson is one of the dominant health systems in the region and state, employing 32,000 workers, including more than 1,400 doctors. The system includes 14 hospitals and Thomas Jefferson University.

Hospitals have become increasingly reliant on the philanthropy of patient donors; charitable donations to health-care systems nationally bring in about $10 billion annually.

Jefferson maintained that the link to incentive pay had only applied to departmental chairs, though other doctors who weren’t chairs told The Inquirer they also were told their bonuses would be linked.

In February, Jefferson said it does not require physicians to make referrals and does not penalize physicians for not participating, but that there were departmental goals.

“Only department chairs (not every member of our medical staff) are asked to achieve department grateful patient referral targets in order to draw more funds for department use on research and education initiatives,” Brand, the communications officer, said at the time.

» READ MORE: Jefferson Health's expansion hits deep pothole with large COVID-19 loss

The system acknowledged that incentive pay for department chairs included a “grateful patient referral metric” that had been added in September. The metric was based on a calculation of the average number of gratitude referrals per month and the percentage of physicians participating, Brand had said.

Even though Jefferson said it didn’t require physicians to refer patients, it created a new tool last year that allows doctors to attach patient referrals to the fund-raising office through the patient’s electronic health record.

The new tool “will notify (institutional advancement) when a patient or patient’s family member has expressed gratitude, or if there are other reasons they might be a potential benefactor,” Edmund Pribitkin, executive vice president of Jefferson Health, had said in a September email to physicians obtained by The Inquirer. “The way it works is simple and straightforward — you place an OIA Philanthropy Communication order … the way you would any other communication order.”

“I’m appalled,” one doctor told The Inquirer in February. “ … If I were a patient, I would be furious.”

The approach came as COVID-19 was resulting in hundreds of millions in losses at hospital systems nationwide. Jefferson was hit hard by the virus, which reduced elective surgeries and nonurgent care and led to more expenses. The hospital finished fiscal 2020 with a nearly $300 million operating loss, even with $325 million in government aid. The health system is erecting a new $762 million outpatient pavilion at 11th and Chestnut Streets.