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     FrontPage Edition: Tue 6 March 2007

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Gearing up Singapore for its 2020 healthcare needs

Source:  www.gov.sg

MOH Budget Speech (Part 1) - Gearing Up for 2020

By Mr Khaw Boon Wan, Minister for Health

This is my 4th Health Budget. Having dealt with the more immediate issues for 3 years, I will from now on focus on gearing up Singapore for its 2020 healthcare needs.
Introduction
I will be 68 by then, with my wife equally silver-haired.
My daughters should be married and hopefully we will have a hall full of grandchildren.
My family and I will need much more healthcare than we do now.
Hence, I am most mindful that 2020 is only 13 years away. We must not let it slip by casually.
The questions posed by Mdm Halimah and Dr Lily Neo are pertinent. We must have answers to those questions over the next few months and continue to refine them over the next few years.
The socio-demographic changes to come are well-known. Still it is worth highlighting the key factors that will significantly impact our future healthcare demand.
Most Singaporeans will be better educated, have higher expectations, want high-quality care and, I hope, be able and willing to pay for it.
For the bottom 20%, striving to cope with global competition, money will be tight and healthcare cost will be their key concern.
The number of people above 65 will increase; fortunately most will be healthy and well. Many will however be health-conscious and will seek medical attention without hesitation, to address any discomfort or just to be assured.
The number of "old-old", exceeding 80 years of age, will increase many-fold. By this age, many will have some medical problem. Many will be financially comfortable, but there will be a sizeable number who will be tight financially.
Scientific discoveries, medical technologies will accelerate and make available diagnostic and treatment modalities that we can only dream of today.
But many of these will be costly and the companies that invent and produce them are not going to give them away for free.
Clearly, one size will not fit all. As Health Minister, my duty is to put the big pieces in place so that by 2020, we have a healthcare system that offers the full spectrum of care that meets the needs of the young and the old, the rich and the poor and the large numbers in between, and we have the financial resources to pay for them.
So let me start with funding.
(a) Financial Resources
In the musical cabaret, Lisa Minelli sang "money makes the world go round", and Jack Neo made "money no enough" part of our psyche. Well, money does not make the world go round, people do. And we will have enough money for healthcare if we save for it, have the right expectations and do not waste.
What are the realities of healthcare?
Everyone will need it, most towards the latter part of life when we are not at our peak in earnings.
Social welfare and comprehensive insurance are seductive ideas - no need for co-payment and nobody needs to worry about healthcare cost.
But they both lead to the "buffet syndrome" of abuses and over-servicing and financial disaster. When the healthcare system is overwhelmed, the poor suffer as unlike the rich they cannot afford other alternatives.
The truth is that healthcare demand is unlimited but supply is, because not many people will willingly pay more tax or insurance premiums which are needed to expand supply.
The rational approach is to require some co-payment by patients. A meaningful co-payment makes a dramatic difference to patient behaviour and even doctors' behaviour.
So that everyone can afford the co-payment, we get everyone to save through Medisave for a rainy day.
On top of that, we pool the risks through a basic insurance plan, MediShield, as the backup.
Finally, we provide sensible social welfare through Medifund as the ultimate safety net.
This is how we tackle the financing challenge, with 3Ms providing multiple layers of safety nets.
Each layer does not cover all cases, but together we cover everyone. Dr Muhammad Faishal asked that we explain our healthcare financing schemes more thoroughly to Singaporeans. I fully agree.
We must keep the schemes easy to understand, because healthcare can sometimes be complex. We will improve our public communication efforts. Let me use this opportunity to reiterate our model.
For minor treatment and healthcare needs at GPs and polyclinics: use cash. Our GP services are very competitive, inexpensive and affordable for most people.
For larger medical expenses that require hospitalisation, our Medisave scheme is working as designed, especially after we have fine-tuned it in recent years.
I have now extended Medisave to cover outpatient treatment of 4 common chronic diseases.
Its full impact will be felt over the years when the scheme matures. I am optimistic that, if participating chronic patients co-operate with their Family Physicians and actively change their lifestyle and comply with medication, their health will improve. This will avoid future complications and save patients money and suffering.
Mr Low Thia Khiang asked that we remove or lower the cash co-payment; I think that will be unwise. Remember that Medisave was not designed for outpatient care. We must not unwittingly deplete it for purposes not originally planned as then the contribution rate will not be enough and we would have to raise it.
Collectively, there are $36 billion in our Medisave Accounts today and this is still growing at more than $1 billion a year. This is healthy but only because we are still a very young society. Medisave is our savings for the future when we will all grow old.
The only structural problem now is that some Singaporeans, a minority, are not saving. They are naturally worried about healthcare cost. The solution is not to make healthcare free but to get them to save. Workfare and Government top-ups will help them build up their Medisave for the future rainy day. But they must themselves make some effort.
For larger medical expenses requiring intensive and prolonged hospitalisation, we have MediShield.
After the reform in 2005, it is now working better. We will continue to refine it to reduce the co-payment by patients but we must not make it a comprehensive medical insurance scheme without any need for co-payment.
Some insurers sell MediShield riders to eliminate co-payment. This is not wise and we do not encourage this. That is why we do not allow Medisave to pay for the premiums of such riders, as proposed by NMP Cham Hui Fong. But if Singaporeans want to buy such riders out of their cash savings, I cannot stop them.
I have a couple of ideas to enhance MediShield further. MediShield coverage among active workers is not bad, at 90%.
But 390,000 Singaporeans below 20 years of age are not insured. The premium at their age is inexpensive, only $30 per year.
And young parents can use their Baby Bonus to pay the premium. So cost is not the issue. Many parents already do so; in fact about half of our youths are covered by the enhanced MediShield promoted by private insurers. Some parents who did not do so told me that they know MediShield is good but inertia is the reason for their lack of participation.
MediShield Auto-Cover for Children
I will make it easier for these parents to sign on their children for basic MediShield coverage.
We will introduce an opt-out scheme for infants to be automatically covered under MediShield from the time their births are registered.
Premiums can be deducted from their fathers' Medisave or alternatively their mothers'. Parents who do not want such coverage can opt out any time by informing the CPF Board. We will get this done later this year.
For those who are already born but below 7, we will work with MOE to provide this opt-out service at the time of Primary One registration.
For older students, we will work with MOE to see how we can get them in as a one-off exercise. I thank Mr Yeo Guat Kwang for his support of the measure and I hope parents will support it too. It will be good for their children.
To keep basic premiums affordable for the majority, MediShield will continue to exclude coverage of congenital illnesses.
But for the vast majority, MediShield coverage from young will give parents the peace of mind that, should their children develop any illnesses as they grow up, they will have insurance coverage for such illnesses and the subsequent treatment.
After I have brought the children into MediShield, I will see how best to bring in the 100,000 or so housewives who are still outside MediShield. I will study Mr Yeo Guat Kwang's suggestion of an opt-out scheme for husbands to sign on their wives.
More.....

Source:  www.gov.sg Media Release 6 Mar 2007

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