Checks and balances crucial to success of system

SINGAPORE // As a regulator, payer and provider of healthcare services, the Singapore government uses free market principles alongside intervention to keep medical costs from going off the rails.

“Price control in the sphere of health care is very much set by the government in Singapore,” said Dr Jeremy Lim.

“The secret of the Singapore model is that the government has multiple levers.”

One of these levers is Medisave – a mandatory national health savings scheme that requires employees to contribute between 8 and 10.5 per cent of their monthly income to a personal account.

The money in that account can only be used for government-approved medical bills run up by the account holder and his or her immediate family members.

When the account reaches the basic healthcare sum of S$52,000 ( Dh134,000) – the amount deemed sufficient for basic subsidised health care in old age – the excess will be channelled into the person’s social security savings fund.

“Essentially, co-paying some of the health care through out-ofpocket savings forces patients to exercise their judgment as consumers,” said Dr Lim.

To help patients make informed choices, the health ministry has, since 2004, published the cost of different procedures at every hospital to promote competition and transparency among healthcare providers.

As Singapore’s healthcare regulator, the government keeps supply in check by controlling the number of private hospital licences, the amount of land released for private hospitals, and by determining the intake of medical and nursing students in local tertiary institutions.

It also decides the number of foreign doctors who will be licensed to practise medicine in the country.

“In Singapore, the biggest funder of health care is the government,” said Dr Lim.

As a major payer, the government sets the pricing for health care through determining subsidy levels, or setting the limits of claims in Medisave or Medishield Life – a government-administered health insurance.

Finally, the government runs 80 per cent of the hospitals and provides 20 per cent of primary health care in the country.

As the main healthcare provider, what it charges patients sets the tone for the competition so that private operators cannot charge much higher.

The government runs 80% of the hospitals and provides 20% of primary health care