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The Singaporean Health Care System

by Chang Liu and William Haseltine, 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 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 responsible for the financing policies and governance of the public health care system.

Who is covered and how is insurance financed?

Publicly financed health care: 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. Coverage is funded through a combination of government subsidies (from general tax revenue), multilayered health care financing schemes, and private individual savings, all administered at the national level. National capital expenditures are set in the government’s annual budget.

The first tier of protection comprises government subsidies of up to 80 percent of the total cost of care provided in public hospitals and primary care polyclinics. This is supported by a group of savings and insurance programs known as the “3Ms” system—for Medisave, MediShield, and Medifund—which plays a critical role in maintaining the public’s 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. Funds in the account are used, under strict guidelines, to pay for health services such as hospitalization, day surgery and certain outpatient expenses, and health insurance for the account holder, as well as for family members.

MediShield is a low-cost catastrophic health insurance scheme to help policyholders meet the medical expenses from major or prolonged illnesses that their Medisave balance would not be sufficient to cover. MediShield operates on a copayment and deductible system. The premiums for MediShield are payable by the insured through Medisave. Singaporeans are automatically enrolled in the program. Permanent residents are covered by MediShield, but undocumented immigrants and visitors are not covered.

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

Private health insurance: A range of private insurance plans are available from for-profit insurers to supplement MediShield coverage. Called Integrated Shield Plans, they are funded from individuals’ Medisave accounts. Singaporeans also have the option of purchasing other types of private insurance, although premiums for these cannot be paid for with Medisave funds. Employers also may provide insurance to employees as a benefit.1

What is covered?

Services: Subsidies are available in public hospitals and polyclinics, as well as from government-funded intermediate and long-term care providers. MediShield provides low-cost insurance coverage for treatments in the subsidized wards of public hospitals and for certain outpatient care, including kidney dialysis and cancer treatment. As a catastrophic insurance program, MediShield generally does not cover primary care, prescription drugs, preventive services, mental health care, dental care, or optometry. Home hospice service is free of charge, while in-patient and day hospice services are subsidized based on means-testing. Governmental-funded home-based services, such as home medical and home nursing, home help, and senior home care, are also subsidized.

Cost-sharing and out-of-pocket spending: The government subsidizes a portion of the cost of patient care, based on ability to pay. Copayments after subsidy can be covered by MediShield insurance or paid for using Medisave savings. After subsidy, MediShield pays between 80 percent and 90 percent of the claimable amount that exceeds the deductible for selected outpatient treatment charges claimable under MediShield; this includes, for example, kidney dialysis, chemotherapy, 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, 20 percent coinsurance is imposed. There is no annual cap on out-of-pocket spending.

Individuals are ultimately responsible for their own health and are required to share in the cost of the health care services they use. In 2013, private spending accounted for 69 percent of total health expenditures, of which 88 percent represented out-of-pocket spending, including that covered and reimbursed by employer health insurance benefits.2

Safety net: Medifund, established in 1993, is the government-funded health care safety net for the poor. 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 can tap Medifund assistance for their patients. Medifund generally covers necessary medical treatment, including drugs, services, and tests. Medical social workers assist patients with the application process required before aid is granted. The amount of aid 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 approved patients receive 100 percent coverage for the outstanding portion of subsidized bills they are unable to pay. MediShield premium subsidies are available for lower- and middle-income Singaporeans, with the subsidized percentage based on income and age. In 2013, Medifund’s capital endowment was more than SGD4 billion (USD4.7 billion).3

In 2013, the government set up Medifund Junior for needy children and extended Medifund to primary care, dental services, prenatal care, and delivery services.4

The ElderCare fund subsidizes care for low- and middle-income patients in intermediate and long-term care facilities. The fund’s endowment stands at SGD3 billion (USD3.5 billion).5

How is the delivery system organized and financed?

Primary care: Primary care is administered mostly by private providers, with 1,400 private clinics offering primary care.6 Eighteen public polyclinics (multidoctor primary care clinics) provide subsidized outpatient care, immunizations, health screenings, pharmacy services, and sometimes dental care. Although accessible to all Singaporeans, these clinics generally serve the lower-income population; the bulk of primary care is delivered by private general practitioner (GP) clinics.

Patients can choose their primary care doctor, with registration 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 Singaporean health care system is strengthening its ties to private GP networks. The Community Health Assist Scheme, introduced in 2012, provides portable subsidies to Singaporeans from lower- to middle-income households. The scheme subsidizes visits to participating private clinics 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: There are numerous specialty care centers, including ones focused on 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; it 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 and also may 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 subsidy benefits for outpatient care provided in 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- and middle-income patients may receive subsidies for outpatient treatment from private primary care providers for chronic or acute conditions, as well as certain dental procedures.

After-hours care: Numerous public and private hospitals offer round-the-clock emergency care, and approximately 30 clinics throughout the country provide 24-hour care. Many other clinics have late-night hours, with lists of these posted online. A 24-hour emergency hotline can be used for contacting ambulances operated by the Singapore Civil Defence Force. A mobile 24-hour house call medical service is available as well. Information on patient visits is not routinely sent to primary care doctors.

Hospitals: General care is delivered at regional hospitals. 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 2010, there were 4 million public hospital outpatient visits, two-thirds of them subsidized.7

Public hospitals are funded from a block budget. Part of the budget is based on the Casemix system, which classifies medical conditions using diagnosis-related groups. Hospitals can reallocate budget savings to 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. Additional government funds are available for personnel training and research.

Wards in Singapore’s public hospitals are tiered in four main classes according to level of amenities. A-class wards comprise one or two-bedded rooms and have the highest level of amenities. Patients there are seen by doctors assigned by the hospital; because they are treated as private patients, their bills are not subsidized. Patients in the other wards receive means-tested subsidies that vary according to choice of ward.

The private sector provides about 20 percent of the secondary and tertiary levels of care. Private hospitals generally offer faster service and more amenities and are more involved in medical tourism than are public facilities.

Mental health care: The Institute of Mental Health is Singapore’s 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. Many public hospitals also offer general and specialized services for eating and sleep disorders, addiction, and geriatric psychiatric conditions.

Health care and social agencies involved in mental health are guided by the National Mental Health Blueprint of 2007. They provide integrated services such as education and prevention, early detection, and treatment for at-risk individuals and those facing emotional difficulties. The blueprint has laid the groundwork for a network of care and support systems intended to eventually enable integrated community living. To improve accessibility of services, the government is establishing multidisciplinary shared-care teams that provide treatment and care to the mentally ill through service networks in the community. It is also providing support for caregivers, building community safety networks for people with dementia and depression, and providing training and support to GPs in managing and caring for people with mental illness in their communities. There are targeted community-based mental health programs for youth, adults, and the elderly as well.

The Institute of Mental Health and voluntary welfare organizations handle most cases requiring residential care or a transition period with close supervision.

Long-term care and social supports: Voluntary welfare organizations and private operators manage long-term care services for the elderly. Services are financed in several 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 and run through designated private insurers, provides monthly direct cash payouts for those who can no longer take care of themselves. Depending on which type of care and setting best suits their needs, seniors and their families can choose nursing facilities or home-based health care providers, including hospice care.

Financial support is available for informal and family caregivers. The Caregivers Training Grant, administered by the Agency for Integrated Care, provides an annual SGD200 (USD235) subsidy for caregivers to attend approved training courses in taking care of the elderly or persons with disabilities. The Foreign Domestic Worker Grant provides SGD120 (USD141) monthly for hiring a foreign domestic worker to care for the frail elderly or for an individual with at least moderate disability.

diagram of health care system

What are the key entities for health system governance?

Singapore’s Ministry of Health has overall responsibility for health care, setting policy direction, managing the public health care system, and ensuring quality of care and responsiveness of the health system to residents’ needs. Its purview includes: needs assessment, services planning, personnel planning, system governance and financing, provider fee-setting, cost control, and health information technology.

The Ministry of Health regulates the health care system through legislation and enforcement. Among 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 for potential problems, which can lead to compliance audits and eventual prosecution. Marketing by licensed facilities is also regulated to safeguard the public against false or unsubstantiated claims and to prevent inducement to use nonessential services, such as cosmetic procedures.

Professional bodies, including the Singapore Medical Council, Singapore Dental Council, Singapore Nursing Board, and Singapore Pharmacy Council, regulate professionals through practice guidelines and codes of ethics and conduct. The ministry also engages these bodies to explain policy rationale and garner support for initiatives. The Health Sciences Authority regulates the manufacture, import, supply, presentation, and advertisement of health products—including conventional drugs, complementary medicines (traditional medicines and health supplements), cosmetic products, medical devices, tobacco products, and medicinal products for clinical trials. Its mission is to ensure that all 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.

The government consults health system stakeholders, including patients, before enacting policies to ensure that public sentiment, concerns, and feedback are taken into account; that diverse views inform the testing and refinement of ideas; and that public understanding and support are cultivated to facilitate implementation.

What are the major strategies to ensure quality of care?

Singapore’s Ministry of Health conducts an annual patient satisfaction survey to gauge patient satisfaction levels and expectations regarding public health care institutions. The survey assesses waiting times, care coordination, and other health service attributes.

Public and private hospitals, clinics, laboratories, and nursing homes are required to submit applications to the ministry for licensure. 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.

The National Health System Scorecard uses internationally established indicators to compare performance. The Public Acute Hospital Scorecard measures institution-level performance, and similar scorecards for providers are being rolled out in primary care facilities and community hospitals. Public health care institutions are monitored to ensure compliance with the standards of service and key deliverables defined by the scorecards.

In 2008, Singapore introduced national standards for health care to set priorities for improvement efforts and promote a culture of continuous quality improvement. The national standards, which focus on ensuring that public institutions provide appropriate care to satisfy patients’ needs, 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.

What is being done to reduce disparities?

The Community Health Assist Scheme provides subsidies to Singaporeans from lower- to middle-income households to obtain treatment at private primary care providers. 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.

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, including an increase in the Medisave employer contribution rate in 2015. Increases are intended to encourage low-wage workers to save more for their retirement and medical needs and to have better access to care, in addition to the government’s additional contributions to Medisave accounts; the latter are also provided to the elderly.

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 care with intermediate- and long-term care. The agency, which operates at the patient, provider, and system levels, advises patients and families on appropriate health care services and helps them navigate the health system. A primary focus is follow-up treatment for chronic-disease patients after discharge from the hospital. Another is the expansion and improvement of health care capabilities at the community level. Currently, all six public hospital clusters in Singapore are undergoing a systemwide transformation to a regional health care system model to better integrate all care services. Hospitals will work closely with other providers in their region, such as community hospitals, nursing homes, general practitioners, and home care providers.

Another significant role for the Agency for Integrated Care is that of ensuring integration of health and social services for elderly and disabled populations. The agency coordinates and facilitates placement of individuals with nursing homes, community providers, day rehabilitation centers, and long-term care facilities; facilitates treatment at home by managing referral of patients to home care services; and assists people with applying 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 formulation of policy, monitoring of implementation, and sharing of patient records. The long-term goal is to allow medical professionals to access clinical data on patient treatment and safety.8

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

How are costs contained?

Singapore spends 4.7 percent of its gross domestic product on health care.9 Costs are controlled first and foremost by fostering and controlling market competition: the government directly regulates the market when it fails to keep costs down. It also can regulate prices for services provided in the public hospitals, as well as the number of public hospitals and beds. Within this environment, private-sector providers must be careful not to price themselves 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 level of reimbursement they will receive for patient care. They are required to break even within this budget.

The government has numerous ways of keeping the health care “demand” in check, including copayments, deductibles, and restrictions on the uses of Medisave and MediShield for consultations, treatments, and procedures. These controls discourage unnecessary doctor visits, tests, and treatments.

The Ministry of Health makes available on its website hospitals’ bills for common illnesses, treatments, and ward classes. Patients can look up the costs of specific surgeries and tests, the number of cases treated in each hospital, and more.

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 informational technology services for the health care system.

What major innovations and reforms have been introduced?

Medisave use has been expanded gradually to cover chronic conditions such as diabetes and high blood pressure, as well as health screenings and vaccinations for selected groups. The Medisave Contribution Ceiling was increased in 2016, and there is no longer a Medisave Minimum Sum.10

Changes initiated in November 2015 to MediShield Life aim to address the growing need for chronic disease care and long-term care. Coverage is now universal and compulsory and 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 (USD118,000). 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 (USD5,882). Less than 1 percent of Singaporeans will need to pay additional premiums.11

In 2015, the Ministerial Committee on Ageing unveiled new features of an SGD3 billion (USD3.53 billion) national plan to help Singaporeans age with confidence, lead active lives, and maintain strong bonds with family and community. The plan encompasses about 60 initiatives covering 12 areas: health and wellness, learning, volunteerism, employment, housing, transport, public spaces, respect and social inclusion, retirement adequacy, health care and aged care, protection for vulnerable seniors, and research.

References

1Figures for the percentage of the population covered by private insurance are not readily available.

2World Health Organization, “Part III. Global Health Indicators,” World Health Statistics 2013 (WHO, 2013), pp. 138–39.

3Please note that throughout this profile, all figures in USD were converted from SGD at a rate of about SGD0.85 per USD, the purchasing power parity conversion rate for GDP in 2015 reported by the World Bank (2016) for Singapore.

4Singapore Ministry of Finance, Budget 2015.

5Ibid.

6Ibid.

7W. A. Haseltine, Affordable Excellence: The Singapore Healthcare Story (Brookings Institution Press, 2013).

8Accenture, Singapore’s Journey to Build a National Electronic Health Record System (2012).

9World Bank, World DataBank; accessed Oct. 14, 2014.

10Singapore Ministry of Health, “All Singapore Residents to Enjoy Universal Coverage under MediShield Life, with No Exclusions,” press release, Sept. 21, 2015.

11Singapore Ministry of Health, Better Health, Better Future for All, Ministry of Health Initiatives for 2015 (2015).