BY JEREMY LIM
Singapore’s health system is lauded internationally for its
ability to achieve outstanding health outcomes at very low national spending.
Yet, 72 per cent of Singaporeans believe “we cannot afford to get sick these
days due to high medical costs”, according to a 2012 Mindshare survey.
How can this be? Our low national spending on healthcare is
the envy of the world and yet Singaporeans are so worried about healthcare
costs.
What makes a great healthcare system? Healthcare planners
the world over dream of the ideal health system: High quality, low cost and
universal access for all citizens. How would Singapore rank along these
dimensions?
The quality of Singapore healthcare is top-notch; 850,000medical tourists in
2012 is testament to our high standards.
What about access? Geography advantages us and, unlike many
large countries which need extraordinary measures to provide for far-flung
populations, Singaporeans are hardly a stone’s throw from a doctor and barely a
15-minute drive from a hospital.
Our weakness lies in affordability, or at least the
perception of affordability. Ironically, why we spend so little may account for
why there is so much anxiety.
INDIVIDUAL RESPONSIBILITY: A DOUBLE-EDGED SWORD
In many developed countries, healthcare is funded
collectively. Citizens are enrolled into a national health scheme and funds
drawn based on individual need. These “solidarity” schemes are designed to
offer medically necessary care without consideration of the ability to pay.
Singapore has eschewed this path, with then-Prime Minister
Lee Kuan Yew asserting: “Subsidies on consumption are wrong and ruinous ... for
however wealthy a nation, it cannot carry health, unemployment and pension
benefits without massive taxation and overloading the system, reducing the
incentives to work and to save and care for one’s family — when all can look to
the state for welfare.”
The Government declared health an “individual
responsibility” in the 1980s and established Medisave and MediShield, enabling
individuals to finance and hence be “responsible” for personal healthcare.
The principle of emphasising the private financing of
healthcare through individual responsibility supported by family has been
praised for helping Singapore achieve remarkable cost constraints, but there
has been a human cost. While the Government has successfully mitigated the risk
of wanton state spending, the consequence arguably is that financial risk from medical catastrophe has
been passed to individual citizens and their families, with resultant anxiety.
Support from Medifund is possible, but only upon applicationand on a
case-by-case basis with no certainty of coverage, complete or otherwise.
C-class wards provide subsidies which can be as high as 80 per cent, but paying
even the remaining 20 per cent may be impossible for hefty bills; 20 per cent
of S$50,000 is still too heavy a burden for low-income Singaporeans.
THE GERMAN EXAMPLE
And healthcare costs can be very unpredictable.
While virtually every country imposes co-payments to guard
against over-consumption, many countries, especially European nations, operate
on the reverse principle to Singapore. Co-payments are preserved as with
Singapore, but the individual’s share of the total bill is capped — for
instance, in Germany at 10 per cent of monthly income — with the government
assuming the financial risk for unexpectedly large bills. No need to apply for special
dispensations or subsidies.
Princeton University economist Uwe Reinhardt, speaking of
the German health system, declared about medicalbankruptcy: “That’s
almost impossible … I have not ever read of Germans going bankrupt over
healthcare.”
In Singapore, MediShield lifetime dollar coverage is capped
at S$200,000 (soon to be S$300,000) with high deductibles and sub-limits on
what clinical services can be covered. All these collectively enable relatively
low premiums to be imposed and render MediShield financially very healthy — but
similar to the structuring of subsidies, financial risk is borne by individuals
and their families, with no certainty of help from Medifund or other schemes.
The theme is consistent: In our healthcare financing model,
safeguards are built first and foremost to ensure system financial viability
and sustainability.
A HUGE MIDDLE GROUND
Defenders of the system will point out the many financially
struggling “welfare states” and proclaim Singapore must never go there. But it
should be noted that between where we are today and the “fiscal extravagance”
of the welfare states, there is a huge middle ground.
Singapore’s total public spending as a proportion of gross
domestic product is only 13 per cent, a far cry from the 40 per cent that
Finland spends. Singapore’s government spending on healthcare is just above
one-third the total, with a long way to go before even sniffing the four-fifths
that is the case in the United Kingdom.
Health Minister Gan Kim Yong’s commitment following the
release of the Population White Paper — to “look at how we can restructure our
primary care sector, our hospitals including our intermediate long-term care
sector”, that is, the entire healthcare landscape — is reassuring, especially
when juxtaposed against earlier comments on looking at healthcare affordability
from the patient’s perspective. Times are changing.
“To live well, live long & with peace of mind” is the
mission of the Ministry of Health. How can we balance “individual
responsibility” with ‘peace of mind’? Between 13 per cent and 40 per cent,
between one-third and four-fifths, where do we want to be?
Dr Jeremy Lim has held senior executive positions in both
public and private healthcare sectors. He is currently writing a book on the
Singapore health system. This is part of a series on health policies in
Singapore.
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