It Figures: Dollars & Sense of Healthcare

numbers are thrown out all the time of a proof of some truth or just fluff that Bluffs us these statistics they need some serious looking into and that’s what I’ll do i Brendon Fernandez we find out the story behind the statistics because some numbers are just worth figuring out you know they all say health is wealth in some parts of the world that’s exactly what people are afraid of the falling sick is a luxury that can’t afford and I’m not just talking about the third world in the United States the number one cause of personal bankruptcy is medical bills in the first-ever survey of the world’s healthcare systems a World Health Organization or whu-oh ranked the US only 37th out of 191 countries surveyed mr. Brendan Fernandez a Singapore on the other hand ranked as the best in Asia and the 6th best in the world so what do we spend on this state-of-the-art healthcare system surprisingly not much here’s how much we spent here we have healthcare spending as a percentage of GDP and here the years since 1995 as you can see over the years since the 1990s it hovers around three to four percent of our GDP if we divide that it works out to about 2000 Singapore dollars or around 1,600 US dollars per person let’s compare that to other countries here’s a bird’s eye view of the world spending on health care as a percentage of GDP the darker the shading the high the spending as a percentage of GDP let’s take the peer pressure approach one of the approaches recommended by the World Health Organization or whu-oh to answer the question how much should a country spend on health care that involves comparing Singapore with other countries with similar characteristics like income levels culture or epidemiological profile which is the study of health and disease conditions in populations so let’s look at the usual suspects from the developed world the u.s. the UK Australia Japan Sweden and Germany let’s take a look at our earlier shops Singapore spending on health care as a percentage of GDP how do we fare against other countries Singapore spends well below them less than half of most and less than a quarter of the United States average health care expenditure even in terms of the average dollar amount per person Singapore’s one thousand six hundred US dollars pales in comparison now there is no recommended standard for how much the country should spend on health care as a percentage of its GDP but when we benchmark ourselves we often look at the Organisation for Economic Cooperation and Development the OECD and this is the OECD average health expenditure as a percentage of GDP 9.5 percent that’s more than double Singapore’s budget how do we keep our healthcare spending so low and yet not compromise on quality for answers I speak to dr. Carol tan a specialist at raffles internal medicine center dr. tan how do we keep spending on health care low compared to that city osed countries first the other countries in the OECD tension of ageing populations they aged a lot faster than we did the second thing is that we have a lot more of what we call lifestyle differences we tend to exercise more we don’t have a large number of obese or bees populations so that is also different one of the key differences in those countries is also how the entire system is structured there’s a very interesting paper from United Kingdom and everybody quotes the NHS system where they talk about the role of government as a nanny or a steward a nanny or a steward correct in certain countries where the state plays a nanny role the state decides and then people just receive the care Singapore has gone the route of the steward our health care system champions individual responsibilities with some state-sponsored safety nets to ensure everyone has access to basic health

services the government pays up to 80 percent of the total bill in acute public hospital b2 and c-class wards the remaining 20% is usually covered by Medisave a mandatory medical savings accounts and Medi shield a low-cost medical insurance scheme so why the system of co-payments it’s to prevent overconsumption and abuse but it does mean that private expenditure on health care what about us or employers is higher compared to other countries in countries such as Germany or in Sweden the the government imposes a cap on what the individual pays and because of this cap this helps to prevent concerns around things like bankruptcy due to high medical fees but in Singapore we do not have such a such a system and in theory the co-payment despite being twenty percent can run into the many thousands of dollars in this year’s budget the Health Minister has has really articulated that the government wants to spend more why the change in tube because over the years there hasn’t just been a change in the way we live there has also been a change in the way we die in the 1950s the biggest killers were tuberculosis pneumonia and diarrhea diseases these are acute diseases this means there is a sudden onset of symptoms and death usually comes soon after the principal causes of death today are cancer heart disease and stroke these three accounted for about 61 percent of all deaths apart from a few types of cancer these are chronic diseases this means that they are long drawn-out and can result in varying levels of disability the reality is it is a lot cheaper when you have an acute illness even if it’s expensive $2,000 if you only pay it once you can afford it but you have paying $2,000 every month or every six months for the rest of your life it is very difficult for chronic disease it’s a whole continuum of care that you need to have it was only as recently as 2006 that you could use your Medisave to pay for outpatient treatments but there are a few catches only at participating clinics for ten specified chronic diseases and a maximum of 400 Singapore dollars per Medisave accounts per year regardless of the number of chronic diseases you may have if you have 10 children then it is easier it becomes affordable because you can ten children times 400 but I think things have changed now we don’t have that many children and so therefore 400 for only one person may not be enough because the drugs are expensive the tests are expensive and so when we review as to whether something is adequate it is a good start but perhaps it needs to be regularly reviewed as to whether it is enough so it seems besides this change in the disease patterns in Singapore the price of life is also on the rise medical inflation is about three percent on average every year this is partly due to general inflation and partly due to advances in medical technologies so we are new drugs we have new devices part of the government spending goes towards this the standard drug list or SDL drugs subsidized by the government there are more than 500 drugs on the list the cost of the drugs on the SDL is subsidized for Singaporeans who stay in b2 and c-class wards in public hospitals the subsidy can cover as much as 75% of the cost but how does mo hate’s decide which drugs get into the list a drug Advisory Committee made of sina specialists from hospitals and MOH reviews the SDL every year it relies on professional cost-effectiveness analyses done locally and abroad here in Singapore it is not in the public domain as to how these specific calculations or what is the underlying methodology used but at this stage is a fairly opaque process in the beyond general principles

members of the public and even the experts who are outside of of the Health Ministry you will not know what the detailed breakdown as to how such such policy reimbursement decisions are made in other words we don’t know what the actual math is that because there isn’t an objective formula to calculate the cost effectiveness of a drug well no there is an internationally recognized measure of the effectiveness of our medical drug or treatment commonly used in other part of the world like the UK or Australia it’s called the cost per quality adjusted life year or cost quali for short it takes into account both the quantity and quality of life added by a particular medical intervention the quantity part is easy let’s say a particular drug adds five years to your lifespan in this case it scores five the quality of life is represented by a value between zero and one zero meaning death and one meaning perfect health so let’s say that the quality of life of this same drug is zero point four because you may experience some side effects so you take the quantity of life multiply it by the quality and you get the quality which in this case is two next we generate what we call a cost utility ratio let’s call this drug drug Abe drug a is the new treatment for medical condition X the current treatment for medical condition X is drug B which has one point five Tori so if you took drug a instead of drug B the Cawley added would be 2-1 point five zero point five is this half a year worth the cost let’s say drug a costs 10 thousand US dollars drug B costs five thousand US dollars so the cost utility ratio of drug a would be the difference in the cost of the two drugs divided by the difference in their cost per quality so drug a’s cost per quali would be ten thousand US dollars now some countries will look at the cost per quality of a drug or treatment to decide whether it is cost-effective or not in the UK for example anything above forty five thousand US dollars per quali is not considered cost-effective so drug a in this case would be considered cost-effective this in a sense provides a universal currency to compare services to compare drugs across different specialties now we know what the minimum money can buy is what is the best money can buy this is the amount Elizabeth novena Hospital on the numerous private hospitals in Singapore all rooms here are single rooms and one will cost you between four hundred and sixty five US dollars and ten thousand four hundred US dollars a night Singapore has ten hospitals and specialty centers in the private sector and Mount Elizabeth novena is one of the newest the private healthcare sector houses fifteen percent of the hospital beds in Singapore and caters to about 20% of our population this means that his bed occupancy rate is on the low end of the spectrum at forty to sixty percent compared to private hospitals like this one the public sector houses 85 percent of the hospital beds in Singapore which makes sense because they take care of 80 percent of the population bed occupancy rate is anywhere from 80 to 95 percent in 2011 we had a total of eleven thousand three hundred and ninety-four beds in Singapore let’s look at the density of hospital beds that means the number of beds available per one thousand people in the 1960s we’re looking at four point three nine beds for every one thousand people since then this number has been on a downward trend which means less beds for the same number of people this is where we were at last count in 2011

2.2 bits per 1000 people this 2.2 beds includes both private and public hospitals if we take out the private hospitals from the equation it would be one point seven two beds per 1000 people compare this to the density of hospital beds in some other OECD countries here’s the density of beds in some high-income economies on average oacd countries have three point four bits per 1000 people Singapore is below that average but according to the healthcare 2020 master plan the Ministry of Health is already planning to tackle any dip in hospital bed availability as our population grows this is the map of Singapore by December 2013 79 beds will be added to the National University Hospital or a new H in the West 50 beds each will be added to Community Hospital’s our mo kio taqwa Kwang Ann’s in Luke’s for more community hospitals and to general hospitals are due to be completed between 2014 and 2020 this will add 4,100 beds to our public sector which will bring our bed density up from two point two to two point two seven per 1,000 people so the question is will that be enough I think it comes down to also the definition of what the bid is that a bid in a hospital setting or in a community hospital setting or a satan and nursing home setting we had a very young population so our bit density was low the whether it should go up there’s another issue again the reality is it is much better to be managed in a community setting and not to be admitted to hospitals unless you really do need it it is also cheaper to be in the community the hospital bid is very very expensive so moving towards Community Care could alleviate the need for more hospital beds but there is another thing the public sector could use more of doctors there were a total of 9,000 646 doctors in 2011 this put our doctor-patient ratio at 1 to 540 how do you compare to the first world in doctor patient ratio let’s take a look at the big fire the US the UK France Germany and Australia the average doctor-patient ratio of these five countries is 1 to 366 so on average our doctor has to deal with 174 more patients than his or her counterpart in these countries but then again it depends on whether the doctor in question works for the private or the public sector if we’re talking about specialists 60% or 6 out of 10 work in the public sector the other 4 attend work in the private sector it seems that more specialists work in the public sector but the distribution of work between private and public sectors is not the same in Singapore 8 out of 10 people depend on the public sector for their more expensive hospitalization needs so the 6 out of 10 doctors in the public sector will deal with these 8 out of 10 patients while the 4 out of 10 in the private sector would only have to deal with these 2 of 10 patients but the good news is that the proportion of specialists in the public sector has been steadily growing from about 56% in 2001 to 62% in 2011 the Republic sector has been very aggressive in his recruitment efforts both locally as well as overseas secondly the Republic sector has been putting in a lot of effort into into retention so salaries have gone up in preparation for a growing and an aging population our health care financing system will be undergoing a revamp for one thing the yearly budget will double from the current four billion to eight billion Singapore dollars by 2016 now we’ll spending a few or a lot of extra dollars help solve our health care problems we know that the OECD countries spent a lot more than we do on health care almost double but does it buy them a more efficient health care system here we have total health care expenditure per person per country and here’s the infant mortality rates it is one of the health indicators used by the World Health Organization or whu-oh to assess

a country’s health care system the lower this number the better and how do we CD countries do in infant mortality in relation to how much they spend countries like the UK France and Germany have a rather high infant mortality despite spending more the u.s. does very poorly here Singapore we get more bang for our buck we spend about $2,100 and infant mortality rate is low at around 2 let’s look at a different health indicator healthy life expectancy the average number of years a person can expect to live in full health the higher the number the better most of the OECD countries do pretty well and our judges having efficient healthcare systems except the u.s. they spend about $7,000 and have a healthy life expectancy of about 70 years which is about the same healthy life expectancy as Singapore except that we spend $2,100 we may not fare as well as our European counterparts but we considered efficient so throwing money at the problem isn’t the solution instead perhaps we should be looking at more flexibility like perhaps portability of government subsidies so that more of the population could use private health care services so that we could alleviate the waiting time the burden on specialists and the bid crunch in the public sector well it’s clear that without subsidies the private sector is in accessible to the average Singaporean right and if we want to optimize the Singapore health care at the system level we really do need to think about portable subsidies what happens in other countries such as Australia it was almost on a voucher system where the government says that for a certain service for a particular consultation the government will reimburse the provider with X dollars and the government is agnostic as to whether is in the public sector or in the private sector so while we have a health care system that is reasonably up to mark times are changing Singapore is facing an ageing population changing disease patterns and a new smaller family structure which means the way that we finance our healthcare needs if you are a rehaul at least the facelift