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The Singaporean Health Care System

by Chang Liu and William Haseltine, Duke-NUS Graduate Medical School and ACCESS Health International

What is the role of government?

The government of Singapore planned, built, and continues to develop and maintain the nation’s public health care system. It also regulates both public and private health insurance in the country. The health care system is administered by the Ministry of Health, which has responsibility for assessing health needs and for planning and delivering services through networks of health and hospital facilities, day care centers, and nursing homes. The ministry manages, plans for, and maintains staffing throughout the system and is also responsible for financing policies and governance of the entire public health care system. Because Singapore is a very small nation-state, there is little regional- or local-level funding or regulation; the national government takes on full responsibility for the health system. Singapore offers universal health care coverage to citizens, with a financing system anchored in the twin philosophies of individual responsibility and affordable health care for all.

Who is covered and how is insurance financed?

Publicly financed health care: The Singapore health care system is funded directly by the national government through its Ministry of Health. The ministry’s budget for fiscal year 2013 was SGD5.9 billion (USD6.7 billion), or 1.6 percent of GDP. The funds come from general revenue, and they are used for subsidies, campaigns to promote good health practices, manpower development and training, and infrastructure expenses. Most of the budget is devoted to subsidies for patients receiving medical care at public hospitals, polyclinics, community hospitals, and certain institutions providing intermediate and long-term care. Other budget allocations are for initiatives addressing obesity prevention, tobacco control, childhood preventive health services, chronic disease management, and public education (Ministry of Health, 2013).

Singapore offers its citizens universal health care coverage, funded through a combination of government subsidies, multilayered financing schemes, and private individual savings, all administered at the national level. The first tier of protection is provided by government subsidies of up to 80 percent of the total bill in public hospitals and primary care polyclinics. There are also subsidies of up to 80 percent in the government-funded intermediate and long-term care institutions. This is supported by a system of savings and insurance programs to help individuals and families pay for their care—known as the “3Ms,” for the Medisave, MediShield, and Medifund programs. Together, these play a critical role in maintaining Singaporeans’ health and welfare.

Medisave is a mandatory medical savings program that requires workers to contribute a percentage of their wages to a personal account, with a matching contribution from employers. Individual contributions to and withdrawals from the accounts are tax-exempt. Account funds are used, under strict guidelines, to pay for health services such as hospitalization, day surgery, and certain outpatient expenses, as well as health insurance for the account holder and family members.

MediShield is a low-cost catastrophic health insurance scheme to help policyholders meet medical expenses for major or prolonged illnesses that their Medisave balance would not be sufficient to cover. All permanent residents are automatically enrolled in the program; undocumented immigrants and visitors are not covered.

MediShield operates on a copayment and deductible system, with premiums payable by the insured through Medisave. A universal health insurance scheme will replace MediShield at the end of 2015 (see below).

Medifund is the government endowment fund set up to aid the indigent. The fund covers Singapore citizens who have received treatment from a Medifund-approved institution and have difficulties paying their medical bills despite government subsidies, Medisave, and MediShield coverage.

Privately financed health care: According to the World Health Organization (2013), in 2010, private expenditure amounted to 69 percent of the nation’s total expenditure on care, 10.1 percent coming from private prepaid plans.

Private insurance is available from a number of for-profit companies, usually in the form of Medisave-approved Integrated Shield Plans. These plans serve as a supplement to MediShield, providing, for example, additional benefits and coverage when a patient opts for Class A and Class B1 wards in public hospitals or private hospitalization. Individuals can use funds from their Medisave accounts to pay the premiums for Integrated Shield Plans.

Employers may also offer private insurance to their employees as a staff benefit. Typically, employer-sponsored insurance cover primary care and other outpatient visits, in addition to hospitalization.

What is covered?

Services: Subsidies are available for care provided by public hospitals and polyclinics, as well as by government-funded intermediate and long-term care providers. MediShield, the second of the “3Ms,” provides low-cost insurance coverage for treatments in the subsidized wards of public hospitals and outpatient care for certain conditions, including kidney dialysis and cancer treatments. As a catastrophic insurance program, MediShield generally does not cover primary care, prescription drugs, preventive services, mental health care, dental care, or optometry. MediShield is operated by the Central Provident Fund Board.

Cost-sharing and out-of-pocket spending: The government of Singapore contributes to building and maintaining the system and subsidizing a portion of the cost of patient care, based on the individual’s ability to pay. Copayments after subsidy can be covered by MediShield insurance or paid for through Medisave savings. For MediShield, an annual deductible against claims must be met before coverage can begin. Coinsurance for inpatient bills ranges from 20 percent to 10 percent as the bill increases. Therefore, after government subsidies, MediShield pays between 80 percent and 90 percent of the claimable amount that exceeds the deductible for selected outpatient treatment charges claimable under MediShield (e.g., kidney dialysis, chemotherapy for cancer, and erythropoietin for chronic kidney failure). Other outpatient services are fully paid from private funds or, in some cases, employer benefits. Deductibles do not apply to outpatient treatments. Instead, a 20 percent coinsurance is imposed. There is no annual cap on out-of-pocket spending.

The health care system requires individuals to be ultimately responsible for their own health and to share in the cost of the services they use. Consequently, patients approach their health care choices knowing that they will pay a portion of the bill. In the Singapore system, patients are responsible for copayments and deductibles that are often higher than in other nations. According to the World Health Organization (2013), private spending amounts to 69 percent of total health care expenditure, of which 88 percent is out-of-pocket, including costs that are covered and reimbursed by employer medical benefits.

Safety net: Medifund, the third of the Singapore system’s “3Ms,” is an endowment program funded by the government as a health care safety net. It was established in 1993, and its mission is to help the poor pay for their care. Money from the fund is disbursed each year to approved institutions, and a committee at each institution evaluates and approves financial assistance to patients. Government-funded providers (whether public or private institutions, or voluntary welfare organizations) are able to tap Medifund assistance for their patients.

Medifund generally covers necessary medical treatment, including drugs, services, and tests. Medical social workers are in place to assist patients with the application process required before aid is granted. The amount of aid granted is determined by the patient’s and the family’s income, the social circumstances of the patient, the medical condition, and treatment costs. More than 90 percent of patients whose applications are approved receive assistance amounting to 100 percent of the outstanding portion of subsidized bills that they are unable to pay.

The ElderCare Fund is another government-established endowment fund established by the government. The endowment, which stands at SGD3 billion (USD3.4 billion), provides grants to intermediate and long-term care facilities to subsidize the care of low- and middle-income patients (Ministry of Health, 2013).

(Please note that throughout this profile, all figures in USD were converted from SGD at a rate of about SGD0.88 per USD, the purchasing power parity conversion rate for GDP in 2013 reported by the World Bank (2014) for Singapore.)

How is the delivery system organized and financed?

Primary care: Primary care is mostly administered by the 1,400 private clinics offering such care (Ministry of Health, 2013). In addition, there are 18 public, multi-doctor polyclinics that provide subsidized outpatient care, immunization, health screening, and pharmacy services, with some offering dental care as well. These clinics, however, generally serve lower-income populations; the bulk of primary care is delivered by private general practitioner clinics.

Patients can choose their primary care doctor, and registration is not required. Private primary care doctors make referrals but generally do not function as gatekeepers. They are usually paid on a fee-for-service basis.

The Singapore system is strengthening its ties to private general practitioner networks. The Community Health Assist Scheme was introduced in 2012 to provide portable subsidies to Singaporeans from lower- to middle- income households. The scheme subsidizes visits to a participating private clinic for acute conditions, specified chronic illnesses, specified dental procedures, and recommended health screening. There are about 720 participating medical clinics and about 460 dental clinics.

Outpatient specialist care: A number of centers focus on medical specialties, including cancer, oral care, cardiovascular disease, diseases of the nervous system, and skin diseases. The National Heart Centre, for example, offers a full range of treatment, from prevention to rehabilitation and is the national and regional referral center for any cardiovascular complications. Research, teaching, and training are also conducted there. Specialists who work in the public system are salaried; they may also see nonsubsidized patients.

Administrative mechanisms for paying primary care doctors and specialists: The government pays subsidies directly to provider institutions, reimbursing them for a portion of treatment costs. Patients receive the subsidy benefits for outpatient care in both public clinics and public hospitals; for emergency care at public hospitals; for intermediate- and long-term care at facilities managed by voluntary welfare organizations; and, through means-testing, for care in private nursing homes. Eligible lower- to middle-income patients may also receive subsidies for outpatient treatment for chronic or acute conditions, and also certain dental procedures, at private primary care providers.

After-hours care: Numerous public and private hospitals offer 24-hour emergency care. There are approximately 30 24-hour clinics throughout the country, and many other clinics have late-night hours; lists of those clinics are available online. There is also a 24-hour emergency hotline that can be used for contacting ambulances operated by the Singapore Civil Defence Force. A mobile 24-hour house-call medical service is also available. Information on patient visits is not sent routinely to primary care doctors.

Hospitals: General care is delivered at regional hospitals. General hospitals offer acute inpatient services and specialist outpatient services, and have 24-hour emergency departments. In 2010, there were more than 11,000 beds (public and private sector) in 30 hospitals (15 public and 15 private, including specialty centers, community hospitals, and chronic care hospitals). In that same year, there were 4 million outpatient visits at public hospitals, two-thirds of them subsidized (Affordable Excellence, 2013).

Public hospital funding is derived from a block budget. Part of the budget is based on Casemix, which classifies medical conditions based on diagnosis-related groups. Hospitals can reallocate savings from the block budget to develop other aspects of public health care services. The block budgets are reviewed every three to five years to ensure that subvention models keep up with changes in models of care and hospital operations. In addition to the block grants, government funds are available for manpower training and research.

Wards in Singapore’s public hospitals are tiered in four main classes, according to level of amenities. Patients in the highest-class wards are treated as private patients and therefore not subsidized. Patients in the other classes receive varying subsidies depending on the choice of ward and means-testing levels.

The private sector provides about 20 percent of secondary and tertiary care services. Raffles Medical Group and Parkway Health are two of the main private hospital groups; they generally offer faster service and more amenities, and are also more involved in medical tourism, than public facilities do. The public sector has begun renting private hospitals’ spare capacity to treat subsidized patients, as private hospitals currently have more beds available.

Mental health care: Health care and social service agencies involved in mental health care are guided by the National Mental Health Blueprint of 2007, and provide integrated services such as education and prevention, early detection, and treatment for at-risk individuals or people facing emotional difficulties. The blueprint laid the groundwork for a network of care and support systems that will enable integrated community living. The Institute of Mental Health is Singapore’s only acute tertiary psychiatric hospital. It provides psychiatric, rehabilitative, and counseling services for children, adolescents, adults, and the elderly, as well as long-term care and forensic services. Patients with addictions can be treated in the Institute’s National Addictions Management Services unit. General and specialized treatment services for eating, sleep, and addictions disorders, and for geriatric psychiatry, are also offered at a number of public hospitals.

To cope with projected increase in demand for mental health care and to improve accessibility, the National Mental Health Blueprint calls for more community-based mental health services, led mainly by tertiary facilities. Components of the program include multidisciplinary shared-care teams operating in service networks in the community; support for caregivers; community safety networks for people with dementia and depression and their caregivers; and general practitioner training and support for the care and management of people with mental illnesses. There are also community-based mental health programs targeting youth, adults, and the elderly. Most cases requiring residential care or a transition period, with close supervision provided by the Institute of Mental Health and by two voluntary welfare organizations (Singapore Association for Mental Health and Singapore Anglican Community Services).

Long-term care and social supports: Management of long-term care services for the elderly is provided by voluntary welfare organizations and private operators. Services are financed in a number of ways, including direct payment by individuals and families, direct government subsidy to patients through providers, and capital and recurrent funding for intermediate and long-term care providers to provide means-tested, subsidized care. ElderShield, a long-term care insurance program regulated by the government but run through designated private insurers, is also available. ElderShield makes monthly direct cash payouts to those who can no longer take care of themselves. These payouts are intended to be setting-neutral, so that families and seniors can choose the type of care that best suits their needs. Eligible care includes nursing home, facility-based, and home-based health care, including hospice care.

Financial support is available for informal and family caregivers. The Agency for Integrated Care administers the Caregivers Training Grant that provides an annual SGD200 (USD228) subsidy to attend approved training courses in caring for elderly or persons with disability. The grant is allocated per care recipient, not per caregiver. Care recipients must be Singaporeans or permanent residents age 65 or older or with disability. The Foreign Domestic Worker Grant, a monthly grant of SGD120 (USD137) for hiring a foreign domestic worker to care for the frail elderly or for an individual with at least moderate disability, is also available through the Agency for Integrated Care. Eligibility requires a maximum household monthly income of SGD2,600 (USD2,965) (Ministry of Health, 2013).

What are the key entities for health system governance?

Organization and planning: Singapore’s Ministry of Health has overall responsibility for health care, setting policy direction and managing the public health care system. Its responsibilities include needs assessment, services planning, manpower planning, system governance and financing, provider fee-setting, cost control, and health information technology, with an overall goal of ensuring quality of care and responsiveness to Singaporeans’ needs.

Regulation: The Ministry of Health regulates the health system through legislation and enforcement. Among the its core regulatory functions are licensing health care institutions under the Private Hospitals and Medical Clinics Act and conducting regular inspections and audits. Advertising is subject to monitoring and analysis to identify potential problems, which can lead to compliance audits and prosecutions in some cases. Marketing by licensed facilities is also regulated in order to safeguard the public against false or unsubstantiated claims and to prevent inducements to using nonessential services, such as aesthetic medicine.

Professional bodies, including the Singapore Medical Council, Singapore Dental Council, Singapore Nursing Board, and Singapore Pharmacy Board, regulate professionals through practice guidelines and codes of ethics and conduct. The Ministry of Health also engages these bodies to explain policy rationale and to garner support for various initiatives. The Health Sciences Authority regulates the manufacture, import, supply, presentation, and advertisement of health products, including conventional medicines, complementary medicines (traditional medicine and health supplements), cosmetic products, medical devices, tobacco products, and medicinal therapies for clinical trials. Its mission is to ensure that all these products meet internationally benchmarked standards of safety, quality, and efficacy. The insurance industry is regulated by the Monetary Authority of Singapore as part of its financial regulatory role.

Public consultation: The government takes the views of patients and other stakeholders into account through various means, including the “Our Singapore Conversation” sessions and an online survey. Public consultation occurs before policies are enacted to ensure that public sentiment, concerns, and feedback are added to the discussion; that diverse views are heard and ideas are tested and refined; and that public understanding and support are cultivated to facilitate implementation. As an example, after public consultation, Medisave was expanded to include a variety of preventive and treatment services, such as mammograms and colonoscopies, treatment of some mental health disorders and chronic diseases, and palliative care.

What are the major strategies to ensure quality of care?

Singapore’s Ministry of Health conducts an annual survey to gauge patient satisfaction and expectations regarding public health care institutions. The survey measures satisfaction with waiting times, facilities, and care coordination, among other health system attributes. Results of the 2012 survey show that 77 percent of respondents were satisfied, and that 78 percent of patients would “strongly recommend” or “likely recommend” institutions to others based on their own experience (Ministry of Health, 2013).

Public and private hospitals, clinics, laboratories, and nursing homes are required to submit applications to the health ministry for operating licenses. Physicians wishing to practice in Singapore must secure a position with a health care institution and register with the Singapore Medical Council, which maintains the official Register of Medical Practitioners. Physicians are required to fulfill continuing medical education requirements administered by the Medical Council. For institutions, prelicensing inspections are conducted to ensure standards.

Singapore uses a performance measurement and management process to help health care providers assess and benchmark their performance against peers. The National Health System Scorecard uses internationally established performance indicators to compare performance. The Public Acute Hospital Scorecard is used to measure institution-level performance. Its indicators cover clinical quality and patient perspectives. Similar scorecards for providers are being rolled out in primary care facilities and in community hospitals.

The scorecards define standards of service and key deliverables required of public health care institutions, and institutions are monitored to ensure compliance. The scorecards incorporate internationally accepted indicators and definitions where possible, such as the U.S. Center for Medicare and Medicaid Services’ Joint Commission– aligned measures for acute myocardial infarction and stroke.

In 2008, Singapore introduced national standards for health care to set priorities for improvement efforts and alignment with planning initiatives. These standards focus on key areas of concern and are intended to promote a culture of continuous quality improvement. The national standards are implemented through the network of Healthcare Performance Offices, each chaired by a senior clinical leader who reports directly to the institution’s chief executive officer or medical board chairman. Resulting quality improvement outputs can then be incorporated into the National Health System Scorecard and the Public Acute Hospital Scorecard for performance analysis and monitoring.

What is being done to reduce disparities?

Community Health Assist Scheme: The Community Health Assist Scheme subsidizes treatment for lower- and middle-income Singaporeans at private primary care sites. The subsidies cover acute conditions, 15 chronic conditions, and a range of dental procedures. Subsidies are also available for recommended screenings for obesity, diabetes, hypertension, lipid disorders, colorectal cancer, and cervical cancer.

Revised Central Provident Fund contribution rates: The Central Provident Fund is the umbrella account under which Singaporeans save for retirement, housing costs, and medical care (through the “3Ms”). There have been periodic increases in both employee and employer matching contribution rates in recent years, with another increase in the employer contribution rate to Medisave slated for January 2015. These increases are intended to encourage low-wage workers to save more for their retirement and medical needs and to have better access to care.

What is being done to promote delivery system integration and care coordination?

Singapore’s Agency for Integrated Care was created in 2009 to bring about a patient-focused integration of primary and intermediate- and long-term care. The agency, which operates at the patient, provider, and system levels, works to encourage health care providers to coordinate their efforts on behalf of the patient. The agency also advises patients and families about appropriate health care services and helps them navigate the system. A primary example of the issues it addresses is follow-up treatment for chronic-disease patients discharged from the hospital. Another major initiative seeks to expand and improve health care capabilities at the community level. To achieve better integration of all care services, all six public hospital clusters in Singapore are undergoing a systemwide transformation to a regional health care system model. Hospitals will work in close partnership with other providers in their region, such as community hospitals, nursing homes, general practitioners, and home care providers.

Another significant role for the agency is to ensure integration of health and social care services for elderly and disabled populations. The agency coordinates and facilitates the placement of sick elderly people with nursing homes, community providers, day rehabilitation centers, and long-term care facilities, and manages referrals to home care services. The agency also actively helps the elderly and people with disability apply for available financial assistance.

What is the status of electronic health records?

Singapore is building a sophisticated national electronic health record system. The system collects, reports, and analyzes information to aid in formulating policy, monitoring implementation, and sharing patient records. The long-term goal is to allow medical professionals to access clinical data on patient treatment and safety. System capabilities include: a master index that matches patient records from a variety of sources and includes a unique identifier as well as other patient identity information; a summary care record for each patient that offers an overview of recent medical activity; access to overviews of specific events, such as hospital admissions; and access to health data in Singapore’s registries for immunization, medical alerts, and allergies.

When fully developed, the system will allow data to be accessed and viewed in appropriate formats by medical professionals, patients, and researchers. Data sources will include the electronic medical record systems of public hospitals and polyclinics. There are plans to enable patients to view and possibly contribute to their personal health records.

How are costs contained?

Singapore spends just 4.7 percent of its GDP on health care (World Bank Health Data, 2014). Cost is controlled in a number of ways, perhaps foremost by the manner in which the government both fosters and controls competition—intervening when the market fails to keep costs down. Public and private hospitals exist side by side, with the public sector having the advantage of patient incentives and subsidies. Because it regulates prices for public hospital services and regulates the number of public hospitals and beds, the government is able to shape the marketplace. Within this environment, the private sector must be careful not to price itself out of the market.

At the same time, the government sets subsidy and cost-recovery targets for each hospital ward class, thereby indirectly keeping public sector hospitals from producing excess profits. Hospitals are also given annual budgets for patient subsidies, so they know in advance the levels of reimbursement they will receive for patient care. Within their budgets, hospitals are required to break even.

To keep demand for services in check, the government possesses numerous tools, including copayments, deductibles, and restrictions on the use of Medisave and MediShield for consultations, treatments, and procedures. These controls discourage unnecessary doctor visits, tests, and treatments, resulting in more careful use of health system resources.

Price transparency: Another factor in controlling costs is price and outcome transparency. On its website, the Ministry of Health makes available hospital bills for common illnesses, treatments, and ward classes. Patients can look up costs for specific surgeries and tests, the number of cases treated in each hospital, and more. Data for public sector hospitals are complete; since private hospitals supply data voluntarily, the information may not offer the same level of detail. Armed with pricing information, consumers are able to shop better for the services they require.

Pooling of funds and purchasing: The Group Purchasing Office consolidates drug purchases at the national level. One goal of this system is to keep drug prices affordable by containing the costs of pharmaceutical- related expenditure. The Group Purchasing Office also purchases medical supplies, equipment, and IT services for the health care system.

What major innovations and reforms have been introduced?

Government spending: Since 2012, Singapore has been conducting a major review of the health care financing framework. In the 2012 health care budget, the Minister of Finance announced the government would increase its annual share of expenditure on health care from SGD4 billion (USD4.6 billion) to SGD8 billion (USD9.1 billion) over four years (Ministry of Health, 2012). The contribution by the government will soon rise from one-third to approximately 40 percent of the total, with the prospect of future increases.

Outpatient subsidies: To maintain affordability of health care, subsidies to lower- and middle-income patients at Specialised Outpatient Clinics in public hospitals were increased starting in September 2014. Subsidies for standard drugs will also be increased these patients beginning in January 2015. Increases are means-tested.

Medisave: Medisave use has been expanded gradually to cover chronic conditions and health screening and vaccinations for selected groups. In early 2015, Medisave will also cover outpatient scans needed for diagnosis and treatment.

MediShield Life: Changes to MediShield are being implemented to address the growing need for chronic disease care and long-term care. Coverage has become universal and compulsory, and now includes individuals with preexisting conditions. Previously ending at age 90, coverage is now for life. The lifetime cap on benefits has been removed, and the annual limit increased to SGD100,000 (USD114,000). Another recent change provides better protection from large hospital bills by reducing coinsurance payments below 10 percent, for the portion of the bill exceeding SGD5,000 (USD5,702) (Ministry of Health, 2014).

Medifund: In 2013, the government added SGD1 billion (USD1.1 billion) to Medifund’s capital fund, which now totals SGD4 billion (USD4.6 billion). This increase will support the implementation of Medifund Junior, which will target assistance to needy children. It also allows for the extension of Medifund coverage in 2013 to primary care, dental services, prenatal care, and delivery. In the same year, annual assistance increased by almost 30 percent, to SGD130 million (USD148 million) (Ministry of Health, 2013).

Community Health Assist Scheme: Previously set at 40 years, the minimum age qualification for the program was removed in 2014. The household income ceiling for eligibility increased from SGD1,500 (USD1,711) to SGD1,800 (USD2,053) per capita per month. More chronic diseases were added, and subsidies for recommended health screening were introduced. These enhancements have enabled more lower- and middle income Singaporeans to benefit from the portable subsidies available at more than 1,000 medical and dental clinics (Ministry of Health, 2014).


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