MEDISAVE SCHEME

[Mr Speaker in the Chair]

Question again proposed.

Dr Tan Cheng Bock (Ayer Rajah): Thank you, Mr Speaker, for allowing me to speak first.

Being the first speaker to open this debate on the National Health Plan (NHP), I thought I would have the advantage of being able to cover a lot of ground on this subject. But going through the 17 letters submitted to the Ministry of Health plus the numerous letters written in the press on this subject and this morning's centre page on Medisave in the Straits Times, I found no advantage, as nearly every aspect on the Health Plan that I would like to comment has been covered. While I would like to think that this is a deliberate attempt by the Ministry of Health to diffuse the issue by the time it reaches Parliament, I must admit that this has been a good PR exercise and I join my colleague from Alexandra in saying, "if we can do it with Medisave, why not with all major Government policies?" The Second Minister for Health has said that the heart of the National Health Plan is the Medisave. I beg to disagree.

Over-emphasis on Medisave

The Ministry of Health has asked this House to approve in principle the Medisave Scheme after having "Noted the National Health Plan". This is an assumption that this House has already accepted the first part of the National Health Plan i.e. the Health Development Strategies. There is an over-emphasis on Medisave, little realising that this part is equally important, if not, more so, because this is where the money from the Medisave will be spent. Too much attention has been paid to the funding of our health care system, and less attention has been paid to the Health Care Delivery Planning. I think before we expect the people to share in the funding, it is only right that we ask ourselves why is the cost of medical care going up? Is it because of increased demand, or is it because of abuse of our system, or is it because our system is inefficient, or is it because of increased services, building new hospitals, new technology like ultrasound, brain scan or expensive programmes like test-tube babies? We must address ourselves these questions because all these and many more will increase cost which the consumers will ultimately have to pay either through higher taxation or higher Medisave payment. It is in this context that I want this House to know, before approving the Medisave Scheme, so that the Ministry of Health will always be on their toes to check areas of medical programmes and care that cost a lot more but has little benefit to society, and also, whether Medisave money, if spent on other programmes would be more profitable to society.

I would therefore leave the detailed discussion on Medisave to my other colleagues while I examine the many areas in our Health Services which will directly or indirectly affect Medisave.

Quality of Care

Going through the first part of our National Health Plan, i.e. the Health Development strategies, I am impressed by the statistics showing how many hospital beds we need, how many nurses, doctors, dentists, pharmacists we require. by the year 2000. How many outpatient dispensaries will be closed down and how many new polyclinics and hospitals will be built. Little mention is made, however, on the quality of future medical care.

Quality of medical care is not necessarily related to cost. It involves more than that. It involves careful planning and training of the appropriate personnel to look into the needs of the patient. Today if you are ill and you have to see a doctor at our outpatient clinics, you will have to wait for a few hours to be seen by a harassed doctor. Investigations are minimal and patients have to go to a few designated centres or even hospitals for further investigations. This is not quality. If you are discharged from hospital after a stroke and sent home, what home support have you if your children are working, and what community support have we? None, except our Home Nursing Foundation. This is again not quality care.

Community Health Team - An Essential Link

If you want to discharge patients to their home environment for further care, you must have a team at the other end to take over. I see no provision in the National Health Plan except that the Ministry of Health will play a catalytic role. This is vague. I think the Ministry of Health must not merely be a catalyst but must be directly involved in starting a "chemical" reaction. Direct involvement of the Ministry is vital in the provision of better health care. To this end, I would like to suggest the formation of the Community Health Team. This Team would be part of our Outpatient dispensary set-up, or by itself. It can consist of doctors, nurses, social workers, health educators and volunteers from the community. This Team will be responsible for providing support to the discharged patient, the chronic sick, the aged, and the aged infirm. If I were half-paralysed, I would be happy to know that the community has a unit for the continuation of home treatment waiting to look after me when I am discharged from hospital. If I were a lonely old man with little home support, living in a 3-room HDB flat, I will be most happy to know that the community geriatric services will be knocking at my door to see to my basic needs. I would just refer Members to Appendix I (Cols. 115 - 116). The details are all there, so I will not talk more on that. Appendix I - Community Geriatric Services (Cols. 115 - 116)

I know the next question that the Minister will be asking is "At what cost?" Of course, the initial sum to set up such an organization will be high because you have to train doctors to be community doctors, nurses to be community nurses. Here again, I refer Members to Appendix II (Cols. 115 - 116) on community nurses. Of course, you need the supporting staff and a place to operate. In the long run, (we are talking about a 20-year Plan) this well-organized Team working in close association with our improved outpatient dispensaries, general practitioners, volunteer organizations, religious bodies, and community leaders will set a high standard of care for our chronic sick, the aged, the aged infirm, disabled people and the recent hospital-discharged patients. We would have shifted from an expensive area of health care, i.e. hospital care, to a non-expensive area with no loss in quality of care. But most important of all, it will provide the link between the hospital, the outpatient clinic, the voluntary organizations, the general practitioner and the patient. Appendix II - Community Nurses (Cols. 115 - 116)

I believe that the future of our health care in the community will depend largely on this total concept of community nursing. This is because of our aging population and its related problems.

Community Hospitals

I am not quite sure that we should set up community hospitals of the kind the Ministry wants. Firstly, setting up hospitals, community or otherwise, is an expensive affair. Then the running and maintenance of these hospitals is going to be a problem. The Ministry hopes that GPs will run these hospitals. I do not see how the busy general practitioner, working from 8.00 a.m. to 9.00 p.m., can run these hospitals. This is an important practical point. The specialist doctors are mainly concentrated in the city area where private hospitals are nearby. I therefore do not think they will want to use these hospitals with such limited facilities. Moreover, patients' preference for well-equipped, better hospitals must be taken into consideration. Patients prefer to go to the Singapore General Hospital instead of Alexandra Hospital or Toa Payoh Hospital or Tan Tock Seng Hospital. What more with Community hospitals which cannot match up to these hospitals in terms of equipment or reputation? Moreover, our size, the smallness of our republic makes travelling to our hospitals not a big problem, unlike countries like Britain where community hospitals are needed to serve communities in far-away areas. Lastly, our National Health Plan has provision to build hospitals in Bedok, Woodlands and Zhong Bang, when the need arises. I therefore question the need for building community hospitals. Upgrade our Outpatient Services

If it is the intention of the Ministry to build community hospitals to take care of the simple surgical cases and less serious medical ailments, I would suggest that we reorganize the present Outpatient clinics to meet such needs. We have this basic infrastructure of Outpatient dispensaries spanning across our country covering practically every corner of the island. Let us build on it to provide a higher standard of care with doctors, nurses, physiotherapists, X-ray services and proper laboratory services. I know the Ministry is doing up some Outpatient dispensaries into poly-clinics and even building new ones but you must be bold enough to provide more facilities in these to include, amongst others, physiotherapy, psychiatric, geriatric and day-surgery with operating theatre to do simple surgery like the lumps, bumps, cysts, cuts, fractures and even ligation and abortions (with apologies to the Member for Whampoa). Even beds for the elderly could be provided who might otherwise have been forced into hospitals. We could invite doctors to join your set-up by renting out spaces to them. We must look into the better use of our outpatient clinics rather than building community hospitals. Hospital care as the Minister has pointed out, costs more than primary health care. This cost will be ultimately passed on to the taxpayer. Our Second Minister for Health who is also the Minister of Defence and the present Minister who was the former Minister of Defence must be aware that the front-line soldiers play an important role in our defense system. I am asking them to apply this strategy to our health system. Beef up our primary health care and the Community will be better off in the long run. In Finland, for example, the Finns realised that hospital-centred care was simply incapable of meeting the challenge posed by the high-adult mortality and chronic morbidity and that more money had to be spent in the community where some of the aggravating circumstances of the illnesses were created. They have set aside approximately one-half of the 6.2% of GNP spent on health care in the country on primary health care and health education. They have the lowest infant mortality rate in the world. I refer you to Appendix III (Cols. 117 - 118). Appendix III - Expenditure on hospitals and primary health care, Number of new posts in primary care (P) and hospital services (H) between 1975 and 1979 (Cols. 117 - 118)

Private Practice & NHP

Then there is much talk about involving the private sector in our future medical care. This is well and good, but I wonder if the Ministry has examined whether the private sector can discharge such a role effectively. At present the care provided by General Practitioners is basic. It is effective but not efficient. Unless the Government is prepared to open its facilities at the Outpatient Clinics to these doctors, their contribution will not change much from the present in the Year 2000. Moreover, HDB encourages individual practitioner, by its present method of tendering, and solo practitioner will not be able to contribute much because of the very nature of his work. The Ministry of Health in the 20-Year Plan has realized this and will be working with HDB to solve this. May I suggest that HDB build clinic complexes to encourage group practice? If it is the Government's intention to encourage private practice, then in line with this trend, the University of Singapore Medical School must include a Department of Community Medicine to train medical students to be community doctors. Only then can GPs in private practice be able to participate in your programme.

There are a lot of expertise in the private sector. It is a sheer waste of medical talent and expertise to find top surgeons doing bread and butter surgery when they were once doing renal transplants and complicated surgery. Similarly, it is disappointing to find top Obstetrics and Gynaecology consultants doing abortions mainly, when once they were teachers of our medical school imparting their skills to medical students.

Our National Health Plan must examine how we can maximize this potential source of valuable manpower by inducing them back to teach and train our medical students on a part-time basis. I know that there are at present some private consul- tants in the hospitals but I ask them: How do they fit into the hospitals? Many feel that their expertise is not fully utilized. Why is this so?

Hospital Doctors and Medisave

I would now like to draw your attention to how hospital doctors' behaviour can affect Medisave. While doctors' services account for less than one-fifth of the grand total health expenditure in many United States Hospitals (I do not have the Singapore Figures), doctors control or exert very strong influence over most of the rest of the health care spending, especially hospital spending. Physicians recommend hospitalization and admit patients. They recommend and perform surgery. They order and perform other diagnostic and therapeutic procedures. They prescribe drugs and they decide when to discharge patients. Blumberg, in 1979, has estimated that physicians control 70% of total health spending. Thus, physicians' propensities to prescribe costly services are of particular interest from the point of view of total health care spending and medisave. I quote from page 173, paragraph 2 of THE HEALTH, ECONOMICS AND HEALTH ECONOMICS.

"Inducing providers to curtail the rendering of those services which yield very low or no marginal health value may be a far more effective and acceptable way to limit spending than attempts to reduce the price or unit cost of services, or to make consumers pay a larger fraction of the price".

Let me give you evidence of what I mean by low marginal health benefits. Hutter and his colleagues at the Massachusetts General Hospital, in 1973, reported a study of early hospital discharge from myocardial infarction, that is, heart attack. Uncomplicated patients were randomly assigned to either a 2 or 3-week hospital stay. During the 6-month follow-up period, there was no difference between the 2-week or 3-week patients in frequency of return to work, anxiety or depression, heart condition or survival. A more recent study tried sending half the uncomplicated patients home on the 7th day, with similar results.

Later two British groups, Mather et al in 1976, and Hill, Hampton and Mitchell, in 1978, did randomized studies by comparing home and hospital care for acute heart attacks and found no discernible benefit from hospital as compared to home care for most patients.

This and many other studies have shown that there is a substantial body of evidence that suggests that, at least in many cases, higher utilization rates yield zero, or possibly negative health benefits. In other cases, higher utilization rates yield marginal benefits that are too small or too elusive to be measured. In still other cases, it appears that utilization of costly services has been expanded in the absence of evidence of efficacy. Allow me to explain. You must have heard of coronary artery bypass graft surgery now in vogue. Many top politicians in the United States have a bypass done for their ailing heart. It is a costly medical technology put into widespread use before its efficacy was established. This operation was first introduced in the late 1960s. By 1977, its annual volume exceeded 70,000 at a cost of roughly US$l billion. The Veterans' Administration started a randomized clinical trial in the early 1970s with more than 1,000 patients, roughly half of whom were treated medically, the other half with this operation. The results were published in 1977 by Murphy et al. Surgical treatment was found to prolong life for the 11% of patients having diseased left main coronary arteries. In the rest, there was no statistically significant difference in survival between the two treatment groups at follow-ups, 21 and 36 months after entry into the trial.

There has been considerable debate over the significance of these results. Some have argued that surgical technique has improved considerably since the trial was conducted, and that there are important quality-of-life benefits not measured by survival rates. Be that as it may, the point remains that a great deal of spending took place in the absence of any scientific evidence that this use of resources produced better health.

Nevertheless, we may proceed with the hypothesis that it is possible to reduce the utilization of some hospital services with- out harm to the health of the population served.

Doctors, the providers of our health care, have therefore a crucial role to play. They can create demand, as I said, by unnecessary admissions to hospitals, unnecessary procedures, both medical and surgical. This is due in part to the training he receives as a student. He has been taught to cherish clinical freedom. The relationship between the patient and the doctor is sacrosanct and cannot be interfered with. The doctor is concerned that his patient receives the treatment appropriate to need, regardless of cost, and from his point of view it is not in his interest to become involved in the issues of resource allocation, financial stringency and priorities. Provided he receives what he needs to care for his patients, that is his only concern. Doctors, therefore, are the prime users of resources in the Health Services and, as such, must be involved in the management of these resources. The University of Singapore Medical School should, therefore, teach medical students the concepts of cost-effective practice. I am serious about this. Medical students are often asked by their professors, "Why didn't you order these tests?" rather than "Why did you?" I remember an incident in my houseman days when a fellow houseman ordered so many X-rays for a person who was involved in a road traffic accident. That person only suffered simple abrasions and cuts. When I asked him why, he said this was to make sure that our superior did not ask him why he did not do this or that. Of course, you could say that this particular doctor is inexperienced and was working under pressure. But the point I am making is that, unless the provider of the health system is involved, all our attempts to cut down costs will be negated by their non-involvement.

Mr Speaker, Sir, we must realize that Singapore is an international city. Ships call at our harbour, planes land on our international airport, cars come in from the causeway. We are vulnerable. Diseases from these countries can easily be spread to us. Constant vigilance in these areas must continue to be top priority. We import workers from other countries. Therefore they must be thoroughly screened.

Our number one major cause of hospitalization is accidents, poisonings and violence. This is followed by diseases of the digestive system, diseases of the circulatory system (including the heart and blood diseases), diseases of the lungs and infective and parasitic diseases. These illnesses are to a large extent environmental and socio-economic in origin. It follows, therefore, that our water supply and sanitation must always be of a high standard, our hawkers must be clean. Singaporeans must be advised to live an easier and less stressful lifestyle: smoke less, eat properly and keep away from too much alcohol. Pumping more money from our Medisave to an expensive area of care like hospitals and sophisticated programmes must, therefore, be weighed carefully. On the other hand, community based projects like Community Health Team working with a better equipped and planned Outpatient dispensaries may be better in the long run.

My fellow MPs, you must remember that this country is free of small pox, polio, cholera, diphtheria and malaria, because these diseases were eradicated by basic primary health care team of doctors, nurses and community leaders.

Mr Speaker, Sir, I support the National Health Plan and Medisave with some modifications. I agree with the Second Minister for Health on the dangers of third party payment like insurances. I concur with the Minister the need for sharing health costs and that Medisave will to a certain extent provide for this. However, I fear that Medisave may not be enough for the chronic sick and some form of insurance coverage may be necessary. We could either allow a percentage of a person's Medisave for this insurance, similar to the home insurance scheme we have for our HDB flat owners. Lastly, Medisave will have many problems during its initial stages and I am glad that the Minister recommends that, I quote him, "there be periodic reviews in the implementation of the scheme and that adjustments be made when experience shows this to be desirable". In a nutshell, the Ministry must be flexible. Don't quarrel or haggle over whether a person has enough Medisave or not when he is in pain. Treat him first and ask him to pay later. If Medisave starts off on the wrong footing, then all this PR work will be wasted and the Ministry will be in trouble.

Thank you, Mr Speaker, for your patience in listening to my fairly long discourse. 5.30 p.m.

Dr Toh Chin Chye (Rochore): Mr Speaker, Sir, I will not go over ground which has been so admirably covered by the Member for Ayer Rajah. I share with him on the desire to have to push or reinforce preventive medicine. But I also would like to remind the Member for Ayer Rajah that we are human beings made of flesh, and flesh has its weaknesses.

The Member for Ayer Rajah is a professional. Therefore, I would not argue with him over those professional points that he has raised. Instead, I will cover the financial aspects of Medisave. I feel that Medisave is being treated in isolation. Medisave is, as I pointed out in the Budget debate, a part of the Government budget and our budgets have been in surplus every year. It is misleading of the Minister for Health to go around the country and create the impression that we are encountering problems like the United States which face running deficits because of expenditure on social security programmes and defence. In fact, the only social security programme we have in Singapore is health. It is wrong to forget that even now patients make direct payments for medical treatment and hospitalization. It is wrong to create the impression that we are distributing health care for free. Payments made by patients constituted 24% of the recurrent expenditure of the Ministry of Health in 1981.

I know it is politically unpleasant to announce periodically increases in hospital charges. It was my job at that time and I can recollect the castigation that I received in the newspapers each time I raised the rates. But this is unavoidable. Costs are bound to go up with each year if for no other reason than because of annual increases in wages. And this applies not just to the Ministry of Health but equally to all other Government bodies and departments.

The Ministry of Health cannot avoid revising medical and hospital rates. The CPF account is a convenient means to collect hospital charges. For that, the Minister for Health has to be congratulated. I know there are bad debts incurred by the hospitals. These bad debts will now disappear. But for that matter if hospital cost will have to be paid from savings, why not allow patients to pay the cost of hospitalization from their savings accounts in the POSB? And there are over two million accounts.

The provision of health care facilities must be accepted as a social responsibility. It is not that an individual who has the misfortune to be inflicted with some particular disease is solely responsible for searching the facilities to cure his illness. This is a social responsibility which is accepted by governments all over the world. This is part and parcel of the organization of individuals into societies. It is a measure of the degree of civilization.

The problem which we are faced with is the cost of financing. Who is to pay? I believe it is wrong to say that the Government is paying for the cost of medical care. The costs of government are borne by taxpayers, us, either through direct taxation, like income tax, or indirect taxation. So the problem really is reduced to finding an equitable distribution of revenue in the Consolidated Fund to meet different objectives and purposes of the Government.

Medisave calls for direct payments by patients to the cost of running 'C' class beds. The recurrent expenditure of the entire Ministry of Health, i.e. the cost of administration, the cost of outpatient departments, the cost of all first, second and third class wards in all hospitals, was $257 million in 1981. Let us assume that the operating cost of 'C' class beds is 70% of the total expenditure, which is a generous assumption. This means that 'C' class wards cost $180 million. The revenue received by the Ministry of Health in that year, 1981, was $62 million, leaving a deficit of $118 million which was met out of the Consolidated Fund. However, Payroll Tax collected was $106 million in 1981, a sum sufficient to meet the deficit for operating 'C' class wards.

Let me take the House to 1982. The Ministry of Health expenditure was $321 million. And again assuming that 'C' class wards cost 60%, the sum would be $192 million. Payroll Tax collection alone was $161 million, leaving a deficit of $31 million which was more than covered from revenue collected by the Ministry.

What we are faced with, therefore, is the problem of apportioning of responsibility and cost. The propaganda put out by the two Ministers for Health is that medicine is a commodity that is consumed. I think it is a very dangerous assumption to believe that persons love to fall ill, that they go around shopping for sicknesses in the supermarkets, or that they like to spend their weekend in a hospital as if the hospital is a hotel. Or that the food served in the hospital is a la carte or buffet. That is perverse propaganda. And, therefore, Medisave is now being treated as a consumption tax. This makes it difficult for one to support the arguments that have been put forward for Medisave. I do not know why the Member for Ayer Rajah was sold over so easily that he has already expressed his support without first listening to the rest of us.

What percentage of the cost of running 'C' class wards can be equitably borne by direct taxation such as Payroll Tax? What percentage of payments is made directly by patients? The proposal behind Medisave is that patients will now make their payments not directly to the hospitals but through their CPF accounts. It is like the check-off system that we have in the trade unions. Now we are being checked-off out of the CPF account. The snag of this scheme is that employers would be asked to contribute to Medisave in spite of the fact that they already have their own private health scheme for their employees. And, in effect, this would mean increasing their Payroll Tax by 3%, even though this contribution does not directly go to the Consolidated Fund but into the employee's CPF account.

I am concerned that in presenting Medisave, the Minister has given no consideration to fundamental points. First, in what direction can the Ministry of Health reduce costs? The Member for Ayer Rajah has very eloquently explained that demand is not generated by patients, and I believe him, particularly patients in 'C' class wards. It's the doctors who create demand as he has explained. Can the Minister, a political appointee, control his doctors?

Point No. 2. What is the projection of future revenue that will be collected by the Ministry of Health? In other words, in what direction is he anticipating the rate of increase in the cost of running the Ministry and therefore the increase in charges that he must pronounce periodically, next year or the following year?

Point No. 3. Can shortfalls be made up from the Consolidated Fund without calling for further contributions to the CPF which is now at 46%?

Point No. 4. Can part of ,the interest earned on CPF accounts be credited to the cost of hospitalization? In 1982, the interest credited to members' accounts was $846 million which is $187 million more than in 1981. The more CPF you pay the more interest you earn. And if, of course, a part of this CPF money is invested overseas where interest is higher than the 6 1/2% we earn, perhaps that additional interest will help to pay the cost of hospitalization. But contributors earn only 6 1/2%.

No firm can afford to have two parallel medical welfare schemes. The trade unions want Medisave and of course they want the existing scheme under the general collective agreement they have made with the employers. The Minister for Health, since he is not the Minister for Labour, has of course ignored all this. The buck is passed on to the employers. Believe me, I have not turned capitalist. I am not speaking on behalf of employers. There are big employers. There are small employers. There are small businesses who hire two persons, maybe even three persons. They have to contribute to all the taxes imposed by the Minister for Finance, including CPF, the Skills Development Fund and Payroll Tax. And these small businesses which pay Skills Development Fund do not see anything coming out of the Skills Development Fund. A barber shop applies for a Skills Development Fund. How can he develop the skills of his barbers? It is the small businesses that are subsidizing the big businesses.

So also is this Scheme. It is a taxation, and it is a recessive tax for the simple reason that those who are at the lower income level, because their CPF contributions are lower, will have to pay the full amount, whereas those with higher incomes do not pay the full percentage of their income towards the CPF because there is a ceiling. It is recessive. I feel that all this is a very short-sighted myopic view. As payroll costs rise, so also prices must increase. And this will have an escalating effect on the cost of living and demand for more wages, and more contribution to CPF. I know for sure there was one businessman who preferred to leave Italy to start a restaurant in Saudi Arabia, for the simple reason that he just could not afford to pay the social security cost imposed on him by the government.

I asked the Minister for Finance earlier this afternoon to find out what revenue Government companies and statutory bodies were contributing to his Consolidated Fund. The Minister was a bit quick in the reply. I was not sure of the figures I jotted down but, if my additions were correct, their contribution was more than the recurrent expenditure of the Ministry of Health. So why have more contributions to the CPF? Has the Minister for Health, who was in the Ministry of Trade and Industry, who was in cahoots with the Minister for Finance, taken the trouble to investigate how he is going to get the money to run his Ministry? The first responsibility of the Minister for Health is to ensure the availability of health care services. That is his first responsibility, that he must go round and nag at the Minister for Finance for the money. But he is taking on the job of the Minister for Finance. I totally disagree with the approach of Medisave. However, as a former Minister for Health, I share with these two Ministers for Health their concern for preserving the existing standard of health care; preserving - I am not saying improving, the emphasis is "preserving".

I happened to visit a patient in a Class A Ward in Kandang Kerbau Hospital, paying full charges. The patient asked for a receptacle so that she could throw out her vomitus. She was given a half-cut discarded plastic bottle which was so small that the vomitus spilled all over the bedsheet; and that was a discarded plastic bottle, in a first class ward. What are we doing with the revenue collected? It will be profitable if the two Ministers were to take time off and inspect the wards. But I question, and I do not agree with the Minister for Health just now when he extrapolated or tried to extrapolate European and American cost of health care into the Singapore situation. I do not agree with him. I have read all the literature. Behind the statistics that he produced just now, there are many pressures, vested interests, interest of pharmaceutical departments, manufacturers of hospital equipment, which have pushed up health care costs in the West completely out of proportion to the rate of inflation. And I worry still that we will soon have an Audit department in the Ministry of Health that may well do nothing but spend its time trying to do an audit on the costs in our own hospitals. I would suggest to the Minister for Health that it will be profitable for him and his staff to study all these underlying causes in the West so that we avoid them in Singapore.

The Blue Paper that has been presented to us this afternoon is out of date. It is said in the Blue Paper down there that contribution to the CPF is 45%. It is 46% now. If it is so out of date so soon, I am alarmed whether in five years' time the 50% rate of contribution to CPF would not also be out of date. Together with contributions to payroll tax, skills development fund, any additional payments to the CPF, particularly from small businesses and partnerships, the increases in payroll tax cost will be a real deterrence. The Blue Paper is not binding on the Minister for Labour, or even a future Minister for Health or a future Minister for Labour. The Minister for Labour is responsible for the Central Provident Fund, not the Minister for Health. The resolution that he has set out before the House does not spell out limits. It is a blank cheque. As far as the Minister is concerned, he gets his 6%. My confidence, Mr Speaker, in resolutions has not been strengthened, particularly when a resolution moved by the Minister for Education in 1979 in this Chamber has not been honoured. I shall abstain from the voting in the resolution. 5.52 p.m.

Mr Lai Tha Chai (Henderson) (in Mandarin): Mr Speaker, Sir, I am not a doctor and therefore I cannot speak like the Member for Ayer Rajah in the capacity of a professional analysing the Medisave Scheme. And I also cannot speak like the respectable Member for Rochore who could draw on his vast past experience in administration and as an academician to analyse the NHP from the economic and health point of view. I can only look at this issue through a simple conception. I feel we should understand what is most important in one's life.

Sir, I remember when I was young my life was not easy because I lived in a difficult environment. I could not have good medical care, and I had also seen in many places, not in Singapore, that many people had not been given medical care as we have been enjoying in Singapore. Sir, what I mean to say is that living in this world if one could be in a situation where the young are nurtured and the able-bodied can be of use while the aged can be accorded security, then one should feel very lucky and contented.

If we who live in Singapore look around we will see that a normal child could have the opportunity to go to school or to be taken care of and to live healthily and develop healthily. We find that he is actually in a fortunate situation. If a youth is healthy, both mentally and physically, it is not difficult for him to get a proper job. And if an aged person is alone and without any support or if he lacks financial means, in the present circumstances in Singapore, he still has the opportunity to be accepted into a home for the aged to pass his twilight years. In other words, in our present circumstances, we have almost solved all the basic problems of livelihood of our people here. Therefore, I agree with what our Minister has said earlier that if we are talking of some issue which pertains to a situation 10, 20 or 30 years later, a National Health Plan for the future, then I will support it because what will happen in the future nobody can tell. But if we are prepared now, then no matter what happens in future we shall be ready to meet it. There is the saying "The weather is unpredictable. Fortune or Misfortune may befall any person at any time." So if we are prepared for any eventuality, it is much better off for all.

Let me illustrate this. In 1959 when the MP for Rochore was also on the scene, our Government had the foresight to raise the 5% CPF contribution some 20 years ago to 46% today. This has given many people in the middle and lower income groups in Singapore the necessary funds from the CPF to buy flats. Had the Government not implemented such measures before, then many of our people today would face housing problems because prices of houses and commodities are very expensive. If people in the middle or lower income group have some savings to help them meet expenses that will arise in future due to illnesses and so on, this will only help them and not harm them. Let me give an example. In the past 18 months constituents of two families came to see me at my meet-the-people sessions. They showed me two hospital bills. Each bill ranged between $200 and $400, both under $500. They were not able to pay these bills. To you, Sir, or to any Member here in this House a few hundred dollars is a very small matter. But outside this House, there are many families who have only one person to depend on for a living. If the bread-winner goes to hospital because of illness, then he is out of job for the time being, and when his condition improves and is recuperating in his home, the hospital bill will then come to him for payment. In such a difficult situation, how is he going to support his family? Therefore, I fully sympathize with the two families. So if there is a requirement of 6% contribution to savings in one's CPF to help one to pay the medical bill, is it not good? To those unfortunate people, I think this 6% saving is good for them and it does them no harm. If anyone should feel unhappy, such as those whom the Member for Rochore has mentioned, i.e. the businessmen or bosses who think they have already given a certain degree of care to their employees in their own organizations and are now required to contribute further to the Central Provident Fund, then, of course, they would not be happy. Like anybody else, they do not like to put more money into somebody else's pockets, as they think they have already contributed 22% to the CPF. But to the employees, they do not have to incur any additional contribution, any more than just about 1% to the 23% contribution which, including the employer's contribution, will give them about 6% of the wages as savings in the CPF. Therefore, the Medisave Scheme appears to be very good for them.

However, Sir, I would like to give two more examples to illustrate how the Medisave Scheme needs some consideration or review just as what the Member for Ayer Rajah has said. I give an example. There are four members in a family - a mother with three children. Two of them have moved out. Only one small daughter is living with her mother and is dependent on her for her livelihood. Not long ago the little girl met an accident and stayed in the hospital for some 3 months, after which the hospital sent a bill to them. The mother is unable to pay and the two other children who live outside are also not willing to pay. Under this Scheme, it is not possible for members of the family to help pay the hospital bill. Is it reasonable? I hope the Minister will give consideration to it.

Another example pertains to an aged person who is ill and is suffering from diabetes. Every day he has to go to the clinic for injection and medication and he has to pay for it. In the meantime he could not work and so he could not afford to go on living in this way because of the great cost of medical treatment. Also he could not seek to die. Under such circumstances, could he make use of his Medisave savings to pay for his medical expenses when he is not hospitalized? Would the Minister consider this problem? The hospital would not accept him and he has to pay, what is he going to do? Although this Medisave Scheme may benefit the majority of the people in the long run, there are special cases. There are exceptions. The Minister should be cautious and pay some attention to such cases, particularly when such cases touch upon one's life and death, just as the Member for Rochore had mentioned. The Minister should consider that to save a person's life is worth all the effort. So we should try to save a person's life first, before thinking of asking for payment so that we do not make people think that "I have money in the CPF savings, yet when I am sick and almost dying I could not make use of the money, so what good is it to me?" Then there is no sense of security. On the other hand, if he thinks the money is of use to him and is of benefit to his members of family and he is also sure that after 10 or 20 years this saving will be good for his family, just like the CPF which after a period of accumulation can be used for purchasing of flats, on this account I will support the scheme. 6.04 p.m.

Mr Tan Soo Khoon (Alexandra): Sir, after listening to the Member for Rochore I am afraid I have to tell the Member for Ayer Rajah that I might be the second person to disappoint him today.

Sir, I have read the National Health Plan. I have gone through it not with the skilful eye of a doctor but I look at it from the point of a layman - how the National Health Plan would affect the common Singaporean. None of us would quarrel with the basic objectives of the Plan, and that is, "to build a healthy, vigorous, active and physically fit population" on the basis that prevention is better than cure.

But on reading the Plan in great detail, I have found some points where it is difficult to reconcile myself with. The Plan starts off by expressing the Government's concern over the increasing demand for our health service. In reading this I could not help but detect that our Government is highly suspicious of our people in that it believes that there is this increasing demand because it is highly subsidized and therefore people tend to abuse the system. Members will recall that some years ago this same argument was used to put forward the case for an increase in charges at the A & E Departments in our hospitals.

Let me start by questioning some of the basic assumptions of the National Health Plan. Why is there an increasing demand on our health services? This is due to an increase in population, including a foreign worker population. It is also due to the fact that our population ages and is becoming more health-conscious, But, Sir, it is certainly not due to people who go to hospitals for the sake of going to hospitals. None of us want to go to hospitals. In fact, you are admitted to hospital only when the doctor refers you to one. Increase in demand for health services is therefore inherent in a society that progresses and continually strives to better the quality of life of its citizens.

The Government's concern over the increasing demand for our health services is reflected in paragraph 2 of the National Health Plan which informs us of a four-fold increase in the Ministry's budget between FY 71 and FY 81. But have these figures been adjusted for inflation? In other words, what is the actual increase in real expenditure between FY 71 and FY 81? At the same time, Sir, we must not forget that Government revenue has also gone up too. I think the Member for Rochore has expressed this quite eloquently. To put it in another way, Sir, is not this increase in demand on our health services and the increase in expenditure a consequence and a reflection of our economic growth, of inflation and of our population increase?

The other objective of the National Health Plan which I would like to raise some thought is its aim of building up individual financial resources through the Medisave Scheme to pay for health care when one falls sick. Medisave will therefore encourage Singaporeans to stay well and reward those who do so as their money will remain in the CPF account and earn interest. Sir, I must again question the assumption here. The Medisave Scheme assumes that each of us has the ability to avoid illnesses. Those who fail to do so will be penalized. Those who have the remarkable talent for doing so shall be well rewarded. What is even more discomforting to me is that the Government aims to reduce demand for health services by using the stick approach. What it amounts to is that Government now intends to transfer the responsibility of payment for such uses from the Government to the users at the point of use. If therefore increasing demand for health services is inevitable, if certain illnesses are unavoidable no matter how fit one wants to be, and if the individual is going to bear the greater brunt of the financial cost of his health care, is it not wrong to assume that the National Health Plan has been motivated by purely financial considerations, and that its more covert purpose is to lighten Government's burden of escalating health care?

Sir, looking at the National Health Plan itself and the emphasis on financial considerations, I have the nasty feeling that the Ministry of Finance had quite a hand in it. What has happened to the Government's social responsibility? I believe, Sir, that somewhere along the line we have to strike the proper balance between what is the Government's social responsibility in so far as health care is concerned and the cost of providing it. My argument that the financial considerations have been foremost is reinforced by paragraph 27 of the National Health Plan which states that there will be more Class A beds at the expense of Class C beds in future. We all know that Class A beds are not subsidized by Government. So the Ministry will take away some Class C beds, convert them to Class A beds, sell them at higher prices and therefore increase Government revenue.

But what is worrying me, Sir, is the statement in the Plan that in future admission to Class C beds will be restricted by the means test. One can already begin to question the reliability of such a means test. It might have the undesirable effect of deterring many people from seeking essential hospitalization if they find that they have been deprived of low-cost hospitalization by this so-called means test. Furthermore, hospitalization charges will not be the only consideration of the individual when he falls ill. He has to think in terms of his loss of earnings when he is hospitalized, not only his earnings but of those members of his family who have to take time off to see him. He has to think of his travelling expenses to and from hospital.

Sir, I was a bit relieved just now to note from the Minister that the quantum of subsidy on Class C beds will not be reduced. But I would urge him to seriously consider that the option of lowest possible cost of hospitalization must be left open to the individual and the individual must not be left with a feeling that he has been deprived of this option by a set of cold statistics.

One more point on the National Health Plan which I like to touch on is the concept of community hospitals. The Member for Ayer Rajah has already stated his views. He questions the viability of this concept and I quite agree with him. However, my reasons may be a bit different because I feel that, aside from the question of economies of scale, Singapore is too small to have too many community hospitals. After all, many of our people would surely prefer to go to the general hospitals which are just as close to them as the community hospitals will be. And I do not really think that we can get our private practitioners to run our Government clinics at night or to run the community hospitals, although the Member's reason and mine differ. I think our private practitioners make enough money and they do not have to be encouraged to moonlight.

Sir, now I would like to turn to the Medisave Scheme. I tend to disagree with the Member for Ayer Rajah when he said that the Medisave Scheme was not the heart and soul of the National Health Plan. In fact, when I discussed the National Health Plan with my friends, the typical response from them was typically Singaporean. How much do I have to pay and what do I get in return? The Minister is correct in saying that we must provide this umbrella for a rainy day. But my question here is whether this umbrella is large enough to shield us from all the rain.

In a nutshell, Sir, the Medisave Scheme allows you to pay for C class care in a Government hospital or its equivalent in a private hospital only if it is for acute hospitalization, and that is all you get from Medisave. It does not allow you to pay for higher class care even if you can afford it. You cannot use it to pay for outpatient services. You cannot use it to cover hospitalization due to chronic or catastrophic illnesses. Sir, in dollars and cents, Medisave therefore really allows one benefit as opposed to a host of things that you cannot do with it.

Let us examine the consequences of this. Paragraph 44 of the National Health Plan tells us that in the last ten years 35% of our population were never hospitalized at all. So of the 65% who can be assumed to be hospitalized at least once in their lifetime, there will still be those who cannot use their Medisave account because the scheme would not cover certain types of illnesses. So quite a large portion of our population will, in fact, not be able to touch their Medisave account.

Secondly, paragraph 55 of the National Health Plan states that a major portion of a person's lifetime hospitalization expenses is likely to be incurred after the age of 55. Sir, I quite agree that it is at this age onwards that chronic and catastrophic illnesses start to creep in and prolonged hospitalization becomes necessary. But what happens, Sir? You discover that having set aside a sum of money every month to provide for such contingencies, you find that you cannot use it when the time comes because your illness happens to fall outside the scope of the scheme. Well, there is some consolation. According to the Plan, you should not worry too much because, should you die, Medisave will pay the money to your Estate, free of duty. But this is my main criticism of the scheme, because it fails to realize that certain illnesses do occur through no fault of the individual no matter how much effort you put in to stay fit and to prevent illnesses. Sir, nobody knows when his kidneys or his heart will fail him. Nobody knows when cancer will strike. Medical treatment for chronic diseases is in many instances, in fact, in almost all instances, life-long and can be a heavy burden on the individual and his family. Medisave is therefore inadequate in meeting such needs. The consequences, Sir, can be far-reaching. If individuals cannot use their Medisave account to cover either wholly or partially such expenses, they may delay seeking hospitalization till their health deteriorates or, worse still, they might resort to self-medication.

Finally, people may find Medisave a wholly unattractive proposition because there might not be the incentive to put money into the Medisave account if they find that their savings cannot be used when it really matters.

Sir, the argument will no doubt be put forward that the 6% contribution will be inadequate to cover chronic illnesses. But let me say that something is better than nothing, at times like this. Sir, I realize that the National Health Plan and the Medisave Scheme cannot answer the needs of each and every individual. It is a unique plan. It is a bold plan and it will have far-reaching consequences. It is by far one of the most discussed issues in recent times and it would not be possible for the Minister and his officials in the Health Ministry to come out with a plan encompassing all the different and differing views that have been expressed. But as this is a matter of such importance and urgency, I would suggest to the Minister that not only should he review the National Health Plan periodically but to make it a point to come back to Parliament and report to Parliament on the shortcomings of the Plan so that we can together discuss, analyse and make recommendations. 6.20 p.m.

Dr Chau Sik Ting (Thomson): Mr Speaker, Sir, having heard the Member for Rochore, I do not consider myself unlucky for not being the first speaker. I suppose I have to declare my interest in that I am a private practitioner with special interest in occupational safety and health.

The preamble of the Motion has these words, "having noted the National Health Plan - A Blue Paper by the Ministry of Health etc". Sir, I have some misgivings about this phrase because the debate is only confined to Part 11 of the National Health Plan ie, Medisave Scheme, and I am uncertain whether Part 1, ie "Health Development Strategies" will ever be debated in a future sitting of this House.

Let me first make a brief point on Part I of the National Health Plan before embarking on Part 11 - Medisave Scheme. The Second Minister for Health may recall that on 24th March, 1982, in the Committee of Supply Debate on his Ministry (Hansard, cols. 1595 and 1596) he gave this House an undertaking that his Ministry would take up my timely suggestion, "to make mention of the comprehensive ... preventive occupational health programme in the National Health Plan". This was in response to my suggestion at that time that when the National Health Plan details were announced in the future, I would like to see a substantial portion of its contents devoted to a developmental strategy for preventive medicine and not a skimpy and hackneyed statement of intention that the Ministry would emphasize on preventive medicine but lacking direction and substance for implementation. Hence, it was with a keen eagerness when I first received a copy of the Blue Paper to see whether my suggestion had been included. But to my utter disappointment, only a few brief lines in paragraphs 7 and 41 were all one could find mentioning preventive medicine and nothing at all on the health care of the working population. Let me re-emphasize what I said before, that the exclusion of the health care of so important a segment of our population, namely, the industrial population, from the pages of Part I of the National Health Plan appropriately entitled: "Health Development Strategies" would so reduce the scope of the coverage as to render it not comprehensive enough to qualify it as "national". If only a few paragraphs were included in the Blue Paper, this will not only enhance the standing of the National Health Plan but more importantly, it will guide the direction and development of proper preventive rather than solely curative health care programmes at the local factory level in the years ahead. My plea at this late stage is for some mention on "Health Care of the Working Population" to be included in Part I of the National Health Plan.

Concept of Medisave

Now, coming to the substantive Motion on the Medisave Scheme as outlined in Part 11 of the Blue Paper, I wish to support in principle the introduction of the Scheme for it is a uniquely Singapore generated scheme, entirely different from the various prepaid health care systems financed either by tax revenue as in the UK and USSR or supported by compulsory insurance of the European social democracies or the free enterprise systems, as in the USA. In all these countries, a political decision has been made to do away with financial restraints on individual demands, whereas the Medisave Scheme shifts the payment of service from a pooled resource to the point of consumption, ie on to the individual. There is an encouragement for individuals to stay healthy and prevents him from unnecessary abuse of public medical services.

Chronic Illnesses Programmes

However, on looking at the Medisave Scheme as a whole, let me now focus attention on one deficient area which has caused widespread concern, namely, the area of chronic illnesses (paras. 52 and 53). It is plainly stated in para. 52 that Medisave does not cover chronic illnesses such as, I quote, "the mentally ill or those who need dialysis for their kidney failure." And the reason proffered for this exclusion is the inadequacy of the 6% contribution.

The apparent implication from this statement is that the sufferers of such chronic illnesses who by and large require prolonged hospitalization and often expensive forms of medical procedures (e.g. dialysis for kidney failure), will have to bear the enormous expenses themselves. This certainly places upon them an unbearable financial burden, particularly if they belong to the average wage earner class. Many have contracted such chronic illnesses through no fault of their own and in most cases, there is little dispute about the necessity of their hospitalization or their use of expensive medical procedures. In other words, virtually no abuse would pertain to such cases. If this were so, then they surely deserve assistance and it is strongly recommended that cases of chronic illnesses should be excluded from any financial restraint placed on them but be assisted by the community through Government sponsored programmes.

In fact, if my interpretation of it is correct, this is how I understand paragraph 53 to mean. I stand to be corrected by the Second Minister for Health on this. Let me now try to interpret paragraph 53. First, it states that "chronic illnesses affect a small minority" and "such patients are best taken care of by other programmes outside of MEDISAVE". I am in entire agreement with this on the principle that the Medisave Scheme places financial restraint on the patient and, in any case, the amount saved would be inadequate. It would be better if such cases were outside the Scheme but taken care of by other programmes which would not lay the burden of hospitalization and medical fees on them. I seem to read some support for this line of thinking in the solitary example of the "other programmes outside the Medisave" cited as in the case of the mentally ill. As one instance of such other programmes, paragraph 53 states that the mentally ill are heavily subsidized by the Ministry when they receive treatment at the Government hospitals and clinics. They only pay a nominal fee. It may therefore not be incorrect to infer from the example quoted that since this programme for the mentally ill is heavily subsidized by the Ministry, other programmes for other chronic illnesses would also as a matter of principle, be equally so subsidized by the Ministry when the Medisave Scheme is introduced.

What I would like to see promulgated is a broad policy direction, where the public could be clearly assured that in cases of those suffering from chronic illnesses and catastrophic illnesses requiring prolonged hospitalization and expensive medical procedures, they would be covered by other programmes which are largely Government subsidized and sponsored, so that they would be duly cared for and be relieved from financial anxieties. I am glad that the Minister in his earlier address has given us a categorical assurance on this.

I can foresee practical difficulties arising from this policy, such as the definition of "chronic illnesses". May I suggest that the Ministry with its panoply of experts could easily draw up a schedule of "chronic illnesses" along similar lines as the Schedule of Compensable Diseases under the Workmen's Compensation Act. Any person who is so diagnosed as suffering from one of the illnesses listed in the schedule of chronic illnesses would then qualify to be taken care of by the Ministry's subsidized and sponsored "other programmes". In cases of dispute, the Ministry could set up Medical Panels, again along the lines of Medical Panels provided under the Workmen's Compensation Act to decide on such issues.

Conclusion

Finally, let me say that, despite what has been said earlier in this House, I fully support the Medisave Scheme in its broad principles and with some modifications as I have elaborated earlier. As it is a uniquely Singaporean scheme, its success or failure will depend on its implementation. My plea is that we should give it a try. And if we are to be what we have been so far, then with the will and determination to succeed, and coupled with humanity and fairness in its implementation, the passage of time will be the better judge of its outcome, say, ten years from now.

Mr Speaker, Sir, I support the Motion. Thank you.

Mr Speaker: It is now 6.30 p.m. Resumption of debate, what day, Mr Goh?

Mr Goh Chok Tong: Tomorrow, Sir.

Mr Speaker: So be it.