Highlights on Gerald Giam's Adjournment Motion on Affordable Healthcare

Gerald Giam
NCMP Gerald Giam filed an adjournment motion in parliament during it's November Sitting to deliver a speech on healthcare financing for Singaporeans and the issue of affordable healthcare. Which is an issue that more and more of us will be grappling with especially in the wake of the G's upcoming introduction of Medishield Life. Here are some excerpts from Mr. Giam's speech for our readers' perusal...
The High cost of Medicine in Singapore
  • The Mindshare “3D” Survey 2012, quoted in “Singapore’s emigration conundrum” by Joyce Hooi, originally published in the Business Times, 6 October 2012 found that 72% of Singaporeans felt they “cannot afford to get sick due to high medical costs.
  • A 2012 study by Watson Towers entitled “2012 Global Medical Trends Survey”, found that medical inflation in Singapore was almost 9% in 2011 – much higher than general inflation.
  • In Singapore, the Government pays less than one-third of all healthcare costs. 
  • More than 60% of costs are paid by patients out-of-pocket, which includes cash and Medisave. This is much higher than the average of 14% in high income countries, according to data from the World Health Organization.
Proposals on Medishield Premiums by Mr. Giam
Mr. Giam pointed out the following:
  • MediShield is designed as an insurance scheme intended to help cover large hospital bills. However, it does not provide full coverage. Patients need to make hefty co-payments, in addition to other claim limits like caps on hospital ward charges, and annual and lifetime claim limits. As a result, MediShield claims covered only 2.1% of total healthcare expenditure in 2011.
  • In August this year, the Government announced plans to provide expanded insurance coverage under a new “MediShield Life” scheme. The proposed changes will move to ensure that all Singapore residents are covered, without exclusions for old age or pre-existing conditions, are welcomed and applauded by Singaporeans.
  • The G has told us that as a result of increase coverage, insurance premiums will have to go up. It is something that people understand that increase coverage comes at a cost but it raises 2 issues that need to be considered:: Should all of these cost increases be borne by policyholders? And will some groups of Singaporeans find the premiums unaffordable?
  • We all know that MediShield premiums increase with age. An 86-year old pays a premium rate that is more than 23 times that of a 20-year old. As such, the elderly shoulder a disproportionate premium burden. Policyholders over age 60 contribute about 36% of total premiums, even though they make up just over 12% of policyholders.
  • Most of the elderly are retired with little or no income and the ones who are unable to afford the premiums are the ones paying the most. Many of our senior citizens have exhausted their Medisave accounts and have difficulty with finding the means top up their medisave. Because of this an average of 650 elderly policyholders opt out of MediShield coverage completely annually. This leaves them vulnerable and at risk of financial catastrophe if they fall ill. The G does not directly subsidise MediShield premiums, although it does give ad hoc Medisave top-ups to the elderly and a Medisave grant to newborns..
  • Mr Giam proposes: that the G introduces a MediShield premium subsidy programme for all vulnerable groups of Singaporeans.  This proposed programme will cover elderly persons with no income and limited savings; people with disabilities; patients who have exhausted their Medisave; low income families; and those who already qualify for Medifund, Public Assistance, ComCare and the Community Health Assist Scheme (CHAS). Mr. Giam proposes that the programme automatically extends the appropriate level of premium subsidies the needy Singaporeans it covers, without a need for them to apply separately. He says that this could help many more Singaporeans to cope with the rising premiums, while ensuring that the MediShield Fund remains fiscally solvent.
Annual cap on out of pocket copayments
  • Singaporeans Medishield policy holders have to make copayments of up to 20% in the form of deductibles and co-insurance. Over 2,400 MediShield policyholders made co-payments of over $10,000 each in 2012.
  • Mr. Giam asked if MOH to explore the introduction of an annual cap on out-of-pocket co-payments made by each patient, with the G paying the difference whenever any medical bill exceeds the cap. Mr. Giam says that such schemes are currently practiced in Japan, South Korea and New Zeland and proposes that we could introduce something similar to what they have. He says that doing so will limit financial risk Singaporeans are exposed to and alleviate anxiety experienced by Singaporeans worried about their medical bills.
Containing healthcare costs
  • For Singapore to be able to contain healthcare costs, it is imperative that the G engages the country's healthcare providers.
  • All healthcare providers within our healthcare system – including GPs, hospitals and preventive care providers – must be made collectively responsible for providing a full spectrum of care for patients. To that end our providers should cooperate and share patient information with each other, in order to make more accurate diagnoses and coordinate patient care. They should focus on keeping patients healthy and ensuring their patients take their medication regularly. This will minimise hospital re-admissions, investigations and treatment, all of which are much more expensive. Providers should be compensated based on their achievement of measured quality improvements, instead of basing their pay on the volume of patients they see or the level of fees their patients pay or a combination of both. All this could lead to healthier patients and lower overall costs for both patients and the system.
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