SINGAPORE GENERAL HOSPITAL (Calculation of B2 ward fee)

Mr J B Jeyaretnam asked the Minister for Health whether he will explain how the full cost of $142.00 for a day's ward fee for B2 wards in the Singapore General Hospital is calculated.

The Minister for Health (Mr Yeo Cheow Tong): Sir, the figure of $142 quoted by Mr Jeyaretnam is the daily cost incurred by SGH in 1993 to provide the basic ward facilities and services for each B2 patient. The salary cost of ward nurses, health attendants and support staff makes up about 60% of the cost. Ward equipment, facilities, and general services such as linen and food constitute another 20%. The remaining 20% goes towards general overheads which include hospital administration and maintenance of common areas and equipment.

However, B2 patients do not pay the full ward cost of $142 at the SGH. Because of heavy Government subsidies, they pay a daily ward fee of only $50. This ward fee of $50 has remained unchanged since 1993.

Mr Jeyaretnam: Mr Speaker, Sir, may I assure the Minister that I am well aware that the patient does not pay that amount every day. Would the Minister agree that the whole purpose of showing the full cost in the bill rendered to the patient is to show that the Government is subsidising the treatment? What I had hoped to get from the Minister was not in percentage terms but actual breakdown of how is it that it costs the Government $142 to maintain a single bed in a ward consisting, I am told, of six beds every day. How does it cost the Government $142? May we have actual figures?

Mr Yeo Cheow Tong: Sir, obviously, Mr Jeyaretnam does not understand operational costs and how they are allocated. I will give him the figures and I hope the figures do not boggle his mind.

Sir, indirect manpower costs include the salaries of staff working in the support departments which are not within the ward, because the daily cost is not the cost of just supporting the six beds in the ward. There are a lot of other costs that are necessary to support those six patients.

First, indirect salary cost, the support staff including staff supporting the facilities, plant and engineering, medical records, infection control which is very important; we have staff checking the infection level to make sure that patients go in and do not get infected by other people; hospital administration, all these come to $43 per patient day. Direct salary of nurses and health attendants within the ward, this comes to $40 per day. Depreciation and temporary occupation licence fee comes to $18 per day. Food services, $7. Laundry and linen, this comes to $4.50 a day. Overhead costs comes to $29 per day. Overhead costs would be things like patient billing, medical records, maintenance, security, maintenance of the common areas, because the hospital does not just constitute that room where the patient is in, but a lot of other common areas. So all these costs amount to $29. As a result, the total daily cost to look after one patient in the B2 wards comes to $142.50.

Mr Jeyaretnam: Mr Speaker, Sir, the Minister talks of supporting services and records. Are we to understand that these supporting services are not only for the six beds in the B2 ward but are for all the patients in the hospital? This is what I would like to know from the Minister, ie, precise figures as to what is the total cost, the number of patients in the hospital on any particular day, and how is it divided.

Mr Yeo Cheow Tong: I would suggest that Mr Jeyaretnam get a copy of the SGH Annual Report where all those figures are there for his examination. After he has studied the Annual Report, and if there are any other further questions, I will be very happy to answer them for him. For me to try to give all the data here would take days. SGH has a workforce of almost 5,000, divided into hundreds of categories. Does he mean that he wants me to give him the precise cost per category, the precise cost of each employee, how the cost is being allocated to the A, B1, B2 and class C patients? Please take a look at the public documents which are available. And if he does not understand after that, I am sure he can get one of his accountant friends to explain to him. After that, if he still does not understand, I will be very happy to explain to him.

Mr Jeyaretnam: May I know from the Minister what are these overhead costs? I thought he had already detailed all the costs. Now we have got an overhead cost, and we have also got depreciation cost. Depreciation of what?

Mr Yeo Cheow Tong: Sir, it costs about $300 million to build a medium size hospital, let alone a hospital the size of Singapore General Hospital. If he understands anything about accounts, he will realise that equipment which you purchase have to be depreciated. That is what the depreciation costs are all about. After you have depreciated all these facilities, you allocate that cost to A, B1, B2 and Class C patients. There are certain formulae which are adopted on cost allocations. As I said, we have the manpower costs, which amount to 60% of the total cost.

Mr Jeyaretnam: May we have the rough figures of manpower employed and their wages.

Mr Yeo Cheow Tong: If Mr Jeyaretnam would like to file a specific question, I would be very happy to give them to him. This is because the cost data of SGH comes to a good sized booklet and I do not think I would be doing Members here any favour by spending the whole one hour just reading through the cost accounting records of SGH.

Mr Jeyaretnam: Well, you could hand it out.

Mr Low Thia Khiang: Would the Minister explain the principle of allocation of costs to the various classes of wards in terms of indirect manpower cost, depreciation and overhead costs?

Mr Yeo Cheow Tong: As I have just mentioned to Mr Jeyaretnam, there are various formulae which are adopted. The formula varies from category to category. For example, direct labour. Direct labour is a direct costing, ie, if that ward has an average of, let us say, 20 nurses, then the cost of those 20 nurses will be fully accounted for by that ward. There are other things which are indirect. For example, the Medical Records Office. How is that cost allocated to A, B1, B2 and C? Because the Medical Records Office serves every patient, it is allocated in proportion to the number of patient days.

As for the common areas, the maintenance cost of the common areas would be allocated in terms of the actual area occupied by the B2 ward. There are certain things which are allocated in terms of the area occupied by the B2 wards. Certain costs are allocated in terms of patient usage and certain costs are allocated based on the intensity of care. So there are different formulae that apply to each of the cost factors.

Mr Low Thia Khiang: Is the Minister satisfied that the formula so far that has been adopted is fair to the cost allocation of lower class wards such as C class and B2?

Mr Yeo Cheow Tong: Sir, all these cost allocation formulae have been arrived at after much discussion with professional auditors and cost accountants and we stand guided by them.

Mr Jeyaretnam: Would the Minister tell us how many nurses and sisters are allocated to one B2 ward or do they serve other B2 wards as well in the vicinity?

Mr Yeo Cheow Tong: Sir, the nurses are normally direct costs, ie, the B2 wards will have perhaps 50 patients.

Mr Jeyaretnam: B2 wards have only 6 patients per ward.

Mr Yeo Cheow Tong: You are talking of per room. But the whole ward may have 50 beds or, in that case, maybe 54 beds or 48 beds. I do not know what is the full complement of ward nurses. As I said, there are 5,000 over staff in SGH, and I am not a walking encyclopedia. It is not my job to know the exact figures anyway, unless Mr Jeyaretnam specifically asks for them. Taking a figure out of the air, if that ward has a complement of 50 nurses, then the cost of those 50 nurses would be divided by 48 beds or 54 beds, and that becomes a direct cost. There are other costs which, as I have said just now, are indirect costs. For example, the Medical Records Office. There, they have maybe 20 staff. Then the salary cost of those 20 staff will be allocated over all the hospital beds. This is because the assumption is that each patient, whether he is in B1, B2 or C class, has the same access requirements to the Medical Records Office. Therefore, they are what we call "allocated costs".

Mr Speaker: Mr Jeyaretnam, would you like to ask your next question?

Mr Jeyaretnam: If it pleases you, Sir. Question No. 6.