MAIN AND DEVELOPMENT ESTIMATES OF SINGAPORE FOR THE FINANCIAL YEAR - 1ST APRIL, 1991 TO 31ST MARCH, 1992
Sir, first, I would like to thank Dr Hong Hai, Chairman of the GPC on Health and my other parliamentary colleagues for their comments and suggestions. They have touched on a very wide range of topics. Generally, the comments and the questions show that on many of the fundamentals there is a convergence of views. For example, many feel strongly that we should encourage and help Singaporeans to take full responsibility for their own good health. They want Singaporeans to be provided quality health services. That the Government also agrees. They expect these health services to be cost effective, which we also agree. By being cost effective, we can then keep the health care cost, or we can at least help to restrain the health care cost, from going up too rapidly. They also want the health services to remain affordable to all Singaporeans, which my Ministry also agrees. Sir, my Ministry's policies are directed at helping every Singaporean to take full responsibility for his or her own health. With escalating health care costs the world over, the old saying that prevention is better than cure is never truer. My Ministry is also committed to helping those who fall ill to recover as quickly as possible. This we do at three levels: the primary health level, which is the first line of medical care, the secondary and the tertiary care levels. Dr Tan Cheng Bock has touched on those areas and I will elaborate afterwards. Sir, I will first address the points and questions on expenditures on health care and hospital services, before asking Dr Aline Wong to reply to the other points. Sir, Dr Hong Hai and several other Members have correctly pointed out that our national health expenditures are low and, in certain cases, extremely low, compared to that of the developed countries. We as a nation spend about 3% of our GDP on health care. In UK, about 7%, Germany and Canada, about 9%, and the USA tops the bill at over 12%. So in comparison with USA, our budget is extremely low. The question is: which is the most appropriate level of expenditure? Are we underspending? Or are the others overspending? Sir, there are several reasons as to why we spend less. It is important for us to realise and remember that. Firstly, the figures are not totally comparable. Different countries compile their health expenditures differently. For example, some include expenditures which are really welfare expenditures. Others include environmental and industrial health and other expenditures. So we are not really comparing apples to apples. Secondly, Singapore has a relatively young population. Our median age is only 29 years, and the proportion of the elderly, ie, those people who are over the age of 60, is only 8%. Thirdly, our fee-for-service has helped to curb excessive demand for health care. In Singapore, fortunately, pre-paid medical insurance still plays only a very minor role. Fourthly, it is cultural. I think Singaporeans, by and large, especially elderly Singaporeans, would prefer, if they can, not to be hospitalised. It is only with great reluctance. This is reflected in our admission rate. In Singapore, our admission rate into hospitals is 124 per one thousand population. In the USA, it is 170 per one thousand population. Sir, the last factor, which is a very important one, is that hospital costs comprise the major component of health care expenditures. For example, in my Ministry, they make up almost 80% of our expenditures. The Government has focused on this area over the years and has ensured that our costs are as low as possible by ensuring that our hospitals are operated efficiently without frills, avoiding proliferation of expensive equipment, and ensuring that the treatment procedures are appropriate and not excessive. The Government provides 80% of hospital services. The inexpensive Government hospital services therefore also act as a brake against what the private sector can charge. So that has also helped to keep the private sector charges lower than what they could have been otherwise. Sir, when you look at the developed countries, there are several factors there that account for why they spend so much. Firstly, there is a very strong practice of defensive medicine. In the West, litigation is fairly common. So doctors over-investigate. If you go in with a sprained ankle, you are likely to get the whole body scanned in case you fell and damaged other parts of your body. Also, there is an unnecessary hospitalisation for observation as well as a propensity to keep patients in hospitals longer to ensure that they are pretty well before being discharged. There is also a proliferation of medical technologies. The health care cost, the whole world over, is increasing by between 10% and 15% a year. Unfortunately, for the developed countries, their economic growth rates have been averaging 2% to 4%. The inevitable result is that with every passing year the health care costs eat into the budget that is available, and therefore health care costs as a percentage of GDP or GNP in the developed countries have been increasing steadily year by year. In Singapore, our high economic growth rate has meant that although our health care costs have been increasing at about 10%11%, the share of the GDP can be main- tained at between 2 1/2% and 3%. That is something that we must ensure. Keep our high economic growth at the present level to at least 6% in the future. Sir, many Members have asked about the expenditures. Let me give you some figures. For financial year 1980, we spent $260 million, which is 1% of GDP. This year our expenditure is $954 million, including the expenditures of the restructured hospitals, so that we are comparing apples with apples. This is equivalent to 1.4% of our GDP. If you take away the restructured hospitals, Singapore General Hospital, Toa Payoh Hospital, Kandang Kerbau Hospital, our expenditure is $722 million, which is equivalent to 1.1% of our GDP. So in terms of the GDP percentage, although we have tried our best, it is still creeping up - 1.4% today. Sir, whilst the amount of money that is being spent, in absolute terms as well as in terms of percentage of GDP, is important, I think what is even more important is that we must look at how the money has been spent. What kind of values are we actually getting for the money. Dr Hong Hai has quoted some figures, so I would not repeat them. Infant mortality rate and life expectancy - these are two key indicators and we are on par with developed countries. Sir, in terms of the quality of medical services, I have met or have received reports from many prominent visiting specialists, from the US and from the UK, who have been here on short term assignments or passing through while being here on conferences. Their assessment is that our medical services here are very comprehensive and of a quality that is comparable to that of their home countries. Despite the fact that the percentage of GDP that is being spent on health care by the Ministry has only gone up very little over the years, we have been able to achieve a much higher level of service. Let me give you some other data. It is very important. How much time does the doctor have for the patients? In 1985, just five years ago, in one year we had one doctor to 1,800 patient days. Last year, the ratio had dropped to one doctor to 980 patient days. That means the doctor is able to double his time with every patient. In terms of nurses per in-patient day, in 1985, 450 in-patient days to one nurse; 1990, 410. So in the nursing ratio we have also managed to improve and therefore enable them to give a better service. Another service is the specialist outpatient clinics. In 1985, each doctor saw about 1,900 patients a year. Last year, the ratio went down to one doctor to 1,000 attendances. So again in that area, we have managed to allocate more resources to each patient. This is well reflected in the waiting time. In Singapore, for an elective surgery, the average waiting time is about one to five weeks, average 12 days. In many of the developed countries, the waiting time is two months to as long as two years in the UK. So in terms of value, I do not think anyone can deny the fact that we have a very good health service even though only 3% of the GDP is being spent on it. We can and should be proud of what we have. But we should not celebrate prematurely and start spending more, just because we appear to be able to afford it. The factors influencing the low expenditures may change. In fact, one factor will definitely change, and that is our population profile. The elderly will double in 20 years and double again in another 20 years. So that one factor will definitely change, and they will create more demand for health services. We therefore have to find more inexpensive ways for treatment as well as to discourage over-usage and over-treatment. We must therefore use this period to build up our savings at both the national and individual levels. Otherwise, when the elderly increases, there will be no money in the kitty to help look after them. So the challenge is not that we should spend more of our GDP on health care, but how to ensure that the percentage of GDP on health care does not creep up too fast. Sir, the Government does place a very high priority on health care. Dr Hong Hai asked whether in comparison to other Ministries, our share is too low. I think the answer to that is that every Ministry must be gauged by the Finance Ministry in terms of what are the requirements and that the funds are given to ensure that those programmes can be carried out properly. In that respect, I must say that the Finance Ministry has been quite fair to the Ministry of Health and they have been giving us the funds that are needed to ensure that our health services remain good. In terms of affordability and subsidies, which several Members have brought up, Sir, we all know that hospital services are very expensive. I shall not repeat the reasons. Those who want to know can refer to the Hansard. They are well-documented. What we need to realise is the funds available on the part of the Government are never unlimited. Ministries are all competing for funds. So there is a finite amount available for each Ministry. Within the Ministry there are many programmes. We have just heard Dr Vasoo saying, "Why are we spending so much money on acute care? We should be spending more on preventive and primary health care instead." Therefore, acute care now ends up with less. So at every point down the line, an apportionment must be carried out. The answer is to make sure that the apportionment is done in such a way that every programme can be optimised. 2.30 pm Affordability. Are our health care costs affordable? Are the subsidies adequate? Should we be giving more subsidies? Let us look at the B2 bills. I am going to quote from SGH which has the highest B2 bills. The average cost for a B2 patient is $1,850. We subsidise each patient to the tune of $1,350. The average bill is therefore about $500. So patient pays $500, Government subsidises SGH $1,350. Is that bill affordable? When we look at the 40th percentile family income, we find that you require 6.1 months of Medisave contributions to pay the bill. For the 20th percentile, which is $900 per month, the answer is for that family member going in, they have to use up 9.3 months of their Medisave contributions. We have to look in terms of the frequency of hospitalisation. The average person would expect to be hospitalised about once every eight to 10 years. For a family of five, they are only using up about 45 months of Medisave and they are able to save on the remaining 45 months. The C Class average cost is quite similar to the B2, but the average subsidy is much bigger, and the result is the bill size for the C Class patient at SGH is about $250. This is equivalent to 3.1 months of Medisave contributions for the 40th percentile family income and to 4.6 months' contributions for the 20th percentile. So therefore B2 and C Class remain highly affordable. Even for the lowest income earners, their Medisave is more than adequate. The question which Dr Hong Hai has raised is: Should we also make A and B1 more affordable by giving them subsidies? Sir, the policy, as I have stated here in the House many times, is that our aim is to ensure that we recover at least recurrent cost from the A and B1 patients. In SGH, they have managed to recover the recurrent cost, but not capital cost. In Toa Payoh Hospital and the other Government hospitals, each A Class patient still gets $200 subsidy per hospitalisation. So they are still getting subsidies. For the B1 patients, although they are not supposed to be getting any subsidies on the recurrent expenditure, SGH still has to give the B1 patients $250 subsidy per hospitalisation. At Toa Payoh Hospital and the other Government hospitals, the subsidy is even higher - $500 per hospitalisation. So it is not that we are not giving subsidies. Despite the policy of trying to recover recurrent cost, we are still giving substantial subsidies to the A and B1. We will try to gradually reduce these subsidies so that in this way we will be able to free up more of the future subsidies for the B2 and C Class patients who are the ones who truly need these subsidies. The principle must be that we let each patient choose the ward that he wants to get into.