HIDDEN_HEAD O - MINISTRY OF HEALTH

Head O - Ministry of Health

The Chairman: Head O – Ministry of Health. Item No. (1), Dr Lily Neo.

Healthcare Costs

Dr Lily Neo: Sir, I beg to move,

That the total sum to be allocated for Head O of the Main Estimates be reduced by $100.

Madam, it is inevitable that with our ageing population, our healthcare costs can only go up. Will our Government prioritise adequate allocation for healthcare? Presently, our Government spends about 1% of GDP on healthcare. Is there a plan to allocate an increasing amount on the healthcare expenditure, and by how much each year, to cope with the increasing needs?

The Minister for Health has said that managing medical inflation is one of his Ministry's priorities. I would, therefore, like MOH to consider the following three tenets that are important for our healthcare cost restraint. Firstly, prevention is better than cure; secondly, healthcare gets more costly, progressing from primary to tertiary care; and, thirdly, healthcare should be commensurate with expertise.

On the first tenet, as I know that the Minister for Health is an advocate of disease prevention, may I therefore ask MOH whether the budget of $98 million for the Health Promotion Board for FY 2004 pales in comparison to $2.06 billion of MOH's total expenditure?

On the second tenet, in order to reduce the dependence on the use of tertiary care, is the Minister providing more intermediate care facilities that are presently inadequate, especially in view of our ageing society?

On the third tenet, may I ask whether MOH is reviewing practices in our public

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hospitals to avoid incentives for over-servicing, especially in specialist services? May I suggest that MOH put in place an appraisal system to take into consideration efficiency without compromising on patient care and ethics?

The Minister has also commented on the silly competition between public hospitals. May I ask the Minister to monitor and ensure that more efforts are made by public hospitals to work closely with one another to avoid duplication of services, to merge similar services and to review and share best practices, rather than competing for the same limited resource, especially human resource?

May I also ask the Minister, lastly, when will he implement a system in our public hospitals to integrate information for better patient care and to avoid duplication of investigations and treatment? Are more efforts being made to better inform the public on each hospital's facilities and to better manage the expectation of the people on public healthcare?

Mr Gan Kim Yong: (In Mandarin) : Madam, medical cost has all along been one of the major concerns of our people. I am glad that the Government has repeatedly assured our people that no one will be deprived of medical treatment just because he could not afford it. But the fact remains that if we unfortunately run into some catastrophic illnesses that require long-term treatment, it will cost a lot of money, to the extent of wiping out the major part of one's life-time savings. Even if the patient is eventually cured, he will run into financial difficulties. I therefore urge the Government to continue with its efforts to contain the medical costs in Singapore.I have a few suggestions to make:

Firstly, enhance the coordination and cooperation among the hospitals so as to reduce the cost of duplication and

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enhance efficiency. For example, the case history and laboratory test reports of the patients could be mutually shared among the hospitals so that in the event of the patients' transfer from one hospital to another, there would be no need to repeat the investigations and tests. This will save time, effort and money. The hospitals could also pool their procurement of common drugs so as to reduce the price of medicine.

Secondly, cut down on unnecessary wastage. For convenience sake, some clinics may prescribe three months' medication to the patients. Because of various reasons, such as changes in the situation of the illness or the patients being uncomfortable with the said medicine prescribed resulting in the medication having to be altered, the remaining medicine from the earlier prescription would be thrown away. This is plain wastage! If we allow the patients to purchase the medicine from the neighbourhood pharmacies, then it would not be necessary to prescribe so much medicine on each visit. It would also be more convenient for the residents.

Thirdly, establish a medical cost index. We should compare our medical cost with that of the other countries with similar standards of healthcare provision. This way, we will know whether our medical cost is reasonable, and whether there is room for lowering the cost.

The Minister for Health is very concerned with ever-increasing medical cost, and has introduced various solutions to endeavour to constrain its expenditures. This is indeed praiseworthy. I hope that the Ministry of Health will continue to work hard to ensure that our medical cost is maintained at the lowest possible level, without compromising the quality of our healthcare service. This is not an easy task, but if our Government, the people and the healthcare providers could cooperate, there is hope of success.

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Mr Zainul Abidin Rasheed: Madam, I think SARS has brought new meaning to MOH. MOH, under the leadership of the former Minister, Mr Lim Hng Kiang, and Dr Balaji and a team of their SARS busters, has brought much respect to all and hope to Singaporeans. However, there is one concern that is still nagging and very much on the minds of most, if not all, Singaporeans, that is, cost of healthcare. Many feel that healthcare cost has been rising far too fast. They worry whether healthcare costs will be kept affordable.

Madam, many Singaporeans, from feedback that I get, also find the Hon. Minister Khaw Boon Wan's eight priorities very exciting and inspiring. Many, however, are wondering how these will translate into holding, if not reducing, healthcare costs. Will more use of IT and technology,

for example, reduce or increase costs? They fear medical care will cost more. Does the Minister agree that the better use of IT and technology could lead to better efficiency and productivity, and thus reduce costs? Can the Minister also explain what steps MOH is taking to help reduce healthcare cost and keep it affordable?

The Chairman: Mr Chandra Mohan is not here. Dr Tan Cheng Bock.

Health Policy

Dr Tan Cheng Bock (Ayer Rajah): Madam, at every healthcare debate, the3Ms keep cropping up. What does this mean? It means we are grappling with a high healthcare cost problem, as one must have enough CPF for Medisave, enough to buy MediShield to protect against catastrophic illnesses, and the Government must provide enough in Medifund to help the poor who cannot pay. How did we end up this way? Have we been looking at health problems from the wrong end of the stick? Did we pay too much attention to the financial aspect and less

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on how we should manage the health of Singaporeans? I use the word "manage" because that is what we should do, not fire fighting the issue. We will have a difficult task because, first, we must change young Singaporeans' mindset about hospitals. It should be the last placethey want to go. The older Singaporeans fear hospitals for a different reason. I would not tell you the reason!

Today, I want to propose a paradigm shift, from curative care, ie, hospital care, to preventive care, ie, disease prevention. Many in the Ministry of Health must have heard my call ad nauseam . I have spoken on this subject for the past 20 years. I outlasted five Ministers for Health, including the Prime Minister, in the process, and I am still talking about it today. I do it because I believe that preventing the spread of diseasesis the right way to control rising healthcare cost, as this area of health management is so much cheaper and effective in the long run. There are two reasons for this shift:

(1)To help contain health costs; and

(2) To better equip Singaporeans on how to take responsibility for their own health, so as to better prepare them to fight not only communicable diseases like SARS, but also non-communicable diseases like diabetes and high blood pressure.

This requires strong political will and adequate resources and commitment directed towards this development.

We have had experience with SARS. We know how the virus created havoc for all. We must learn from it. It cost us a bomb to contain SARS. One reason why I feel developed countries, including Singapore, panic when hit by SARS is complacency. Complacent because they thought they had eliminated the infectious diseases and let their guard down. Worse still, more attention was paid to hospital

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care, and demand for specialised treatments was created in hospitals. Health became an industry, and controlling of diseases became a lower priority. During early SARS, we doctors in the private sector had problems finding out who was in charge at the Ministry. Primary healthcare, I learned, has been fragmented into many sub-divisions in the Ministry of Health.

The Chairman: Dr Tan, you need to wrap up and ask your questions.

Dr Tan Cheng Bock: Do I have to summarise?

The Chairman: Yes, please, because you have already used up your time.

Dr Tan Cheng Bock: But a truncated speech is no speech. So, would you allow me to ---

The Chairman: Yes, you have already used up your allocated time. Please ask your questions.

Dr Tan Cheng Bock: Yes. I am asking the Minister to elevate primary healthcare to a level suchthat we can have a better way to prevent diseases from spreading. For that, I would encourage the Minister to take back the two clusters, all the polyclinics, so that the Ministry, together with these polyclinics, can make a better presentation and understanding to Singaporeans on how the spread of diseases can be controlled.

Dr Gan See Khem (Nominated Member): Madam, the Minister has announced that restructured hospitals will focus their attention on providing affordable care for Singaporeans. That is a call that many Singaporeans feel very comfortable with. The issue that some of my parliamentary colleagues brought upearlier is:canhealthcare cost really be controllable? Withincreasing drug cost, labour cost, etc,can the Ministry effectively bring

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healthcare cost down so that it isaffordable to many Singaporeans? Most Singaporeans look at subsidised care, ie, B2 and C classwards, as a safety net.

For many years, low-income Singaporeans are guaranteed care through means testing, and this is something which we are all very supportive as a caring society. Middle-class Singaporeans look at the safety net, but many do not use these B2 and C class facilities if they do not need to. The announcement earlier on about the introduction of means testing for all Singaporeans has caused some concern for the middle andhigh income earners, because many of them will be denied access to subsidised care when financially they are in need of that type of care. Many older Singaporeans are widows. They live in private homes bought when they had high incomes. But as they get older, many of them are unemployed. If not,they are not retired and have no means of earning high income. So, the question is: why are we denying subsidised care to older Singaporeans, even for those who do not pass the means test? 93% of taxes were paid by the top few percent of Singaporeans, and should they not have the right to get access to subsidised care later on in life when they really need it? I think Singaporeans will be supportive of the test for eligibility, ie, we do not need to offer subsidised care to non-locals. But it is another issue when we do not take care of our locals when the time comes and they really need it. Would the Minister be able to give us an idea how the needs of those who do not qualify under the means test but are in need of subsidised care, going to be protected?

The Government is now talking about introducing insurance. Healthcare insurance has failed in many countries, especially when access to care is unlimited. In the case of Singapore, people will support insurance if the Government really introduces means

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testing, because they all need the safety net. And what aboutthe insurance premium? Where will it come from? Will it come from the individual's pocket, or will we be able to claim it from our Medisave account or from MediShield or Medifund? What are the plans the Government has to work with insurance companies to provide payment schemes so that more Singaporeans can get access to these insurance schemes?

The Chairman: Dr Gan, you have to wrap up, please.

Dr Gan See Khem: Yes. Many of us are not familiar with buying complicated health insurance programmes with many deductibles and restrictions. Is the Government going to educate and guide us on how we can choose a health insurance plan that best fits our need and help us navigate this whole sea of unknowns?

Healthcare

Dr Michael Lim Chun Leng (Pasir Ris-Punggol): Madam, I wish to declare my interest as a doctor with a regional medical practice.

The SingaporeGovernment is growing the healthcare sector as an economic driver. Public and private healthcare institutions are banding together to market Singapore as a healthcare hub. While that is a move in the right direction, the larger potential market for Singapore healthcare institutions is to be where the market is, especially for countries which are large and have a demand for high quality healthcare and are yet less likely to come to Singapore because of the distance. India and China are two large neighbouring countries where there is a large demand for high quality healthcare services. Yet, it is highly unlikely that Indian and Chinese nationals would come

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here for healthcare services in large numbers.

Firstly, we cannot compete with our counterparts in Malaysia and Thailand on cost. We can only compete on quality.

Secondly, the standard of healthcare there is improving by leaps and bounds. I visited a hospital in Shanghai recently which did paediatric heart surgeries. They do more than 200 such surgeries a year with no mortality. These are certainly very, very impressive figures. China is growing very rapidly, and renowned US healthcare institutions are now trying to get into the healthcare market in China where there is a large pent-up demand for world-class healthcare services. Our strength is that we have a very good system of healthcare that can produce consistently good results, and we are constantly at the cutting edge of technology.

To grow healthcare as a driver of our GNP, we will need to be present in large markets like China. If we do not enterinto the Chinese market in three to five years, when the market is liberalised and there are largeAmerican and Europeanhealthcare institutions there, Singapore will become irrelevant to them. By then, with a lower cost base, China and India will become our competitors in the healthcare sector. We must rise to these challenges. If Singapore succeeds in being a major healthcare provider in China and India, we will not only be able to grow our GNP, but we will be able to grow a huge healthcare talent pool that would not haveotherwise been possible. This will strengthen our depth in healthcare expertise and make us a leading healthcare provider in Asia.

I would like to know how the Ministry of Health can change the mindset of the civil service to be more pro-enterprise orientated, and what role the Ministry can play in helping Singapore Inc grow in the region.

Ministry programmes

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Madam, I turn now to my next cut. The Ministry of Health has evolved from being a healthcare provider to being a regulator. Over the years, the Ministry is regulating more and more areas in medicine, making Singapore one of the most highly regulated healthcare markets in Asia. They regulate just about everything, including what doctors can put on the signage in the clinics, what the doctor can say in public, and almost everything that the doctor does, except sleeping and eating. In this era, where the Singapore Government wants to grow healthcare as an economic driver, the Ministry must loosen its iron-fist grip, avoid adding more regulations and redraw the boundary lines for the medical profession. The Ministry of Health and the Singapore Medical Council must change their mindset. While they play an important role in regulating the healthcare profession, they can play an even more important role in helping the healthcare sector grow. They must not act like traffic wardens trying to issue a summons at the first possible opportunity. They must facilitate to show the way as to what the healthcare profession can do to create awareness of the services and expertise available.

I remember years ago when my clinic was opened in Mount Elizabeth Hospital, the Theng Hai Association had, without my knowledge, taken an advertisement in a Chinese newspaper to congratulate me as I was their adviser and, can you believe it, a complaint was made against me! Yet, it is not uncommon for public healthcare institutions to have press interviews to advertise their services. If the Ministry is serious about making Singapore a healthcare hub, it must allow healthcare professionals to make known their expertise and services to the lay public and to foreign patients. This will increase transparency and allow patients to know what services their doctors are

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accredited to perform. The Ministry and the Singapore Medical Council should also facilitate the entry of specialist doctors into Singapore in both our public and private healthcare institutions to strengthen our professional healthcare expertise.

I would like to ask the Minister when the Ministry can provide clear guidelines for healthcare professionals, and wheredoctors can seek clarification, if they have queries. I would also like to ask the Minister how the Ministry can facilitate the entry of foreign healthcare talent into Singapore to strengthen our pool of healthcare professionals.

Means Testing

Dr Lily Neo: Madam, DPM Lee said in his Budget Statement that, even with means testing, a high income patient can opt for B2 or C class treatment but will be subsidised less. The concern is that there are people in the sandwiched group that do need the heavier subsidy due to financial constraints or heavier commitments. Considerations must, therefore, be accorded to this group who need the heavier subsidy, not by choice but by circumstance.

Will MOH ensure healthcare affordability for the majority before implementing means testing? We should establish some alternative risk sharing insurance for our population before implementing means testing. To this end, healthcare financing through insurance to reduce an individual's burden at the time of need is a worthy consideration. As I have mentioned before in this House, national insurance covering the whole population through our Medisave should be allowed.

6.15 pm

At present, means testing in nursing homes is based on the total income of

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older family members divided by the number of members in the family. Madam, this is unfavourable to small families. Often times, it is difficult to get information on income from all the members of the family and many elderly fail to get a subsidy as a result. Other times, family members or applicants are not willing or unable to submit their documents for a variety of reasons as with confidentiality or self-employment situations. There is a need to refine the present system of means testing.

Madam, it is inevitable that with our ageing population, an increasing number of people will need more subsidised hospital beds. Is there a plan to increase the number of “C” and “B2” class beds together with the necessary medical teams for them? Presently, the “C” class wards are already bursting at the seams. How does MOH ensure that the most in need are not going to be deprived of such high demand subsidised beds and care in public hospitals? Will there be more allocation of subsidies for public hospitals?Under the present allocation of subsidies, together with an increasing number of hospital admissions, I am afraid that the imbalance of subsidies and operating costs will be passed on to patients. Will there be an increasing and good provision for our national healthcare to prevent the imbalance? Is there a better plan on how healthcare subsidies will be distributed?

Dr Ong Seh Hong (Aljunied): Madam, actually part of the ground isedgy over the Ministry of Health's intention to introduce means testing in the allocation of resources. These are especially Singaporeans who are in the middle-class group and they are worried that they may be squeezed out of this subsidised healthcare. It also means that when means testing is applied, this group of people will enjoy a smaller subsidy, if any,

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from the Government. Most of them have no quarrel over the MOH’s argument that means testing is to better allocate limited resources in favour of the poor. However, they are worried that healthcare can be very expensive especially with an ageing population. They would like to be prudent and to stretch their healthcare dollar longer and further. They also feel that they have contributed in paying taxes and so on, so they should be entitled to subsidised healthcare.

I would like to urge the Ministry to be mindful of this concern. Currently, the means testing is supposed to be used only in step-down care, supposedly only for the 50th percentile of income level, which means half of the population may not enjoy it. For acute medical care, some of the bills can be quite high and even for those who are just above the 50th percentile, it could be a very big burden on them. Their limited savings will be depleted very fast.

Secondly, the current system of means testing on a per capita income basis is also biased against smaller families because regardless of the family size,the fixed cost of running a household is there. Maybe there is a need for further modifications on the current system of means testing.

Thirdly, the percentage of subsidies should also vary, depending on the nature of treatment and the size of the medical bill. Because if we say that based on this income level, they can only enjoy x% subvention, for a small medical bill, for example, a simple operation that costs $2,000, if there is only 50% subvention, we just need to pay $1,000, that is fine. But if it happens that a person is to be in the ICU for a few months, and the bill can be, say, $100,000, then 50% of $100,000 is a lot of money.

Finally, I would like to urge the Ministry to avoid creating a bureaucratic monster just to administer means testing.

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Mr Yeo Guat Kwang: Madam, members of the public have perceived that there are considerable savings if they just simply change their choice from "A" to "B" or "B" to "C" class wards. The key factor contributing to the difference is, in fact, the level of Government subsidies allocated to the respective wards. For example, the portion borne by a patient after the subsidy for "B2" is almost double that of "C". Since manpower constitutes much of the total medical costs, the only difference is in terms of the hardware and the amenities, for example, toilets, TV and the number of bedsunder the respective wards. The actual medical bill a patient will have to bear between "A", "B1", "B2" or "C" wards could be marginal if the Government reviews the formula of subsidy using the means testing. There is a need for the Ministry to clarify such "public myth" that if members of the public choose "B2" or "C" wards, they should be entitled to considerable savings from the lack of luxurious fittings, and advise the public that with means testing, how would the level of subsidies be different for patients from different income groups.

Dr Chong Weng Chiew (Tanjong Pagar): Madam, I declare my interest as the CEO of Ang Mo Kio Hospital.

The principle of means testing to allocate subsidies based on a patient's ability to pay is definitely a sound one, considering our limited resources in Singapore. Hence, I would urge the Ministry to consider implementing it in all public hospitals as soon as possible. I do understand that what I propose is a little bit different from some of the earlier speakers.

The need to implement it as soon as possible is necessary because the longer we delay, the more difficult it would be to implement when the time comes. Definitely, we know that there are

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challenges in the implementation. I have close to about two years of experience in implementing means testing in community hospitals and nursing homes. The processes and tools involved can certainly be improved currently. There are messy and dodgy paperwork and there are long waits for family members to submit income documents, and as a result of which has led to delays.

Therefore, I propose that the CPF Board and the Inland Revenue Authority, which currently are not involved, be involved so as to speed up the process. They could help to reduce administrative and manpower costs substantially.

I would also like to propose, as what Dr Lily Neo has mentioned, to build more "C" class wards. "C" class wards 10 years ago and "C" class wards today are very different. The quality between subsidised wards and non-subsidised wards today is minimal. Thus, there is a good demand for subsidised wards, even from middle class and wealthy Singaporeans. Although they would not be entitled to subsidies once means testing is implemented, at least, they should still have the choice of lower cost wards.

Next, would the Ministry please also review the proposed income caps to qualify for the various subsidies? They should reflect our remuneration conditions more realistically. The proposed caps are too low, as what Dr Ong Seh Hong has mentioned earlier on, and currently resulting in about half of the current Singapore population not qualifying for some form of subsidies.

Lastly, both acute care hospitals and step-down care facilities must use the same template for means testing if we do intend to extend means testing to acute hospitals. For example, we should not use household income to determine subsidies at acute hospitals but per capita income

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at step-down care facilities. A one system, two methods, would cause much confusion and chaos for all parties - the families, the acute hospitals, as well as the step-down care providers.

My very last point is that, from what I read in the newspapers, there is a great amount of misunderstanding from the public about means testing. Many thought that if they do not qualify for any subsidies, they are unable to go to low-cost wards, like "C" class wards. I think the Ministry should embark on an exercise campaign to let the public know what means testing is all about.

Mr Chay Wai Chuen (Tanjong Pagar): Madam, I share the views of many of the previous speakers regarding means testing. I would urge the Minister to be cautious in moving this means testing scheme. Even professional and middle-class people are arguing that they should not be denied the services in hospitals if they choose to go for a "C" class or be charged at a subsidised rate. The argument is, why discriminate them of this right of choice? After all, they have paid all the taxes that they have to pay. And there is this fear amongst the generation of the post-war baby boomers, who are now almost reaching 60. They are very concerned about the healthcare charges for their old age.

I urge the Minister not to roll out the means testing scheme unless he has in place a health insurance scheme in adequate range and cover. There has to be more work done by actual studies to arrive at the premium and scale of this insurance scheme. The coupling of this means testing to a fully comprehensive insurance cover scheme should be tightly done before we implement this means testing.

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I believe that the present MediShield scheme is not comprehensive enough. Should the Government not work towards liberalising this MediShield scheme to let it be completely available to insurance companies so that they can work out the right product through risk pooling? It may be very useful when certain treatments or procedures are going to be expensive or very costly than the differential rates of subsidies, like what was mentioned by Dr Ong just now.

Finally, for patients who are recovering from operations or illnesses and require nursing care - I believe presently nursing careis not insurable - I hope that the Minister could consider including downstream nursing care to be incorporated into the insurance scheme for healthcare charges under this means testing regime.

The Chairman: Mr Low Thia Khiang and Mr Heng Chee How are not here. Mdm Halimah.

Mdm Halimah Yacob: Madam, everyone has an opinion on means testing because health is a matter that is close to the heart of every Singaporean. Even those who are healthy today are concerned over the implications because, as sure as the sun rises, everyone will fall ill at some point of time in their lives and may land up in a hospital.

Many Singaporeans today belong to the sandwiched generation where they have to take care of not only their own spouses and children but also aged parents or, in some cases, sickly siblings. The Government has repeatedly said that while it will have schemes to support those who are in difficulty, the best defence will still be the families supporting each other. Yet, in introducing this means testing scheme, the Government is making it more difficult for families to help each other.

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I am concerned, Madam, about the social implications of such a policy and how it will affect behaviour onthe ground. Will we see less support for elderly Singaporeans or those who are handicapped and sickly? And what about encouraging families to have more children? I am concerned that the policies and the messages that the Government is sending are contradictory and confusing. In my view, the angst, frustration and cost of administering means testing far outweigh whatever the benefits that can be reaped from introducing it. I would like to ask the Minister the following questions.

Although means testing has already been implemented for step-down care and other services, hospital care is different. Even if per capita family income is used as the basis, a major prolonged illness can still cause a tremendous strain on the financial resources of a family. What yardstick will be used to measure affordability which is fair and equitable and also take into account individual needs?

Secondly, will the paperwork and investigations associated with implementation of any kind of means testing add a substantial administrative burden to the system, with a resulting increase in administrative costs? A means testing system requires a large administrative staff to review applications and determine whether they meet the relevant criteria.

Thirdly, will the means test be applied at a time the person is admitted to hospital or at regular intervals after the hospital stay started or for subsequent visits as a person's status may change over time?

Finally, means testing requires someone who wants to benefit from the subsidy to identify themselves as poor. The process of documenting one's

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poverty and hardship can be a difficult and demeaning process initself, to my mind.

Madam, we should handle means testing with care. People are most vulnerable when they are ill. My concern is that means testing, instead of reaping any good, will instead create more ill-will and anger and is, therefore, counter-productive. I would therefore like to urge the Minister to allow for enough public discussions andairing of views before means testing is introduced. I would also like to suggest to the Minister not to introduce means testing before an effective insurance scheme is put in place to catch those who fall outside the subsidy net. The current deductibles under MediShieldare very high. Those without an insurance policy to cover them and are not eligible for subsidies will be badly affected.

The Chairman: Order. It is 6.30 pm.

Thereupon Mdm Deputy Speaker left the Chair of the Committee and took the Chair of the House.

The Acting Minister for Health (Mr Khaw Boon Wan): Mdm Deputy Speaker, I beg to report that the Committee of Supply has made further progress on the Estimates of Expenditure for the financial year 2004/2005, and ask leave to sit again tomorrow.

Mdm Deputy Speaker: So be it.