Challenge to control rising health-care costs

Politicians who promise free care distort market, fuel rising costs: Khaw

By Salma Khalik , HEALTH CORRESPONDENT

THERE is no such thing as free health care.

This is a key tenet that makes Singapore's system among the most cost-effective in the world - and politicians, especially, should take note.

Touching on the hot topic of health- care reform in his keynote speech at a two-day Economist conference yesterday, Health Minister Khaw Boon Wan said politicians bore part of the blame for rising costs.

They have to tell the truth, and not promise free health care for all if ballooning costs are to be controlled.

In Singapore, patients know they have to shoulder part of the cost for health- care services, and thus look for value for money and do not over-consume.

But when politicians promise free health care, they distort the market, and set the table for over-consumption, resulting in higher costs for governments.

With health-care reform a buzzword in countries from Australia to the United States now, Mr Khaw told the gathering of about 200 health professionals at the Fullerton Hotel that ageing populations and slower economic growth are placing severe cost stresses on systems everywhere, and countries are urgently seeking reform.

In the US, for example, President Barack Obama recently pushed through a landmark health-care reform plan that has been described as the most expansive social legislation enacted in the country for decades.

Mr Khaw said that while Mr Obama's changes were 'an important step forward', they are 'clearly not deep enough and may not even do much to reverse the cost escalation'.

In Germany, where the social health insurance scheme was invented, employers want to cap their contributions to health insurance plans, leaving patients to pay the rest.

Singapore itself is not immune to rising costs, Mr Khaw said.

'In the past decade, annual consumer price index increases averaged 1.5 per cent, while annual health inflation was 2.9 per cent,' he said.

Though the country has kept its healthcare cost at below 4 per cent of its gross domestic product (GDP), or under US$8 billion (S$11.2 billion) for a population of five million - a figure others find 'amazing' - it will not stay that way because of the ageing population here, he added.

Singapore's aim is to keep the percentage of GDP spent on health care at a single digit, which he said would be a remarkable achievement.

The minister said the way forward lies with people having a strong sense of personal responsibility for their own health.

Older patients also need to ask if they truly require the services of multiple subspecialists.

Finally, they have to accept their mortality and the limits of medical science.

Mr Khaw quoted a BusinessWeek magazine article on an American patient whose seven-year fight against kidney cancer topped US$600,000.

After his death, the man's wife concluded: 'The only thing I can see that the money bought for certain was confirmation he was dying.'

Treating health care like any other economic activity, Mr Khaw said, is one way to make the system good and cheap.

Promoting competition among providers, publicising their performance and making sure consumers seek value for money are some ways to do this, he said.

This is why the Ministry of Health (MOH) provides patients with information so that they can make better choices.

It now publishes the bill sizes for the 70 most common hospital treatments on the Internet. This is updated monthly.

In time, MOH will provide more information, such as surgical complication rates and hospital acquired infection rates, to patients.

Having better educated and better informed patients, Mr Khaw said, makes him optimistic about health-care reform.

'Such a population has the potential and capacity to consciously choose healthy lifestyles, pursue disease prevention, early detection and treatment, and to comply with disease management regimes,' he said.

And what of politicians?

They have a role to play too, he said: 'We must be prepared to break the mould, innovate, and tell the people the plain truth.'

"Finally, they have to accept their mortality and the limits of medical science." - this being said by a minister sounds almost scary, if you ask me.

Ex-Chief Economist of GIC once mentioned in a ST interview that Singapore's healthcare spending is miserable compared to other developed countries. Even if we double our spending this year, we'd be spending the same amount Taiwan was spending 10 years ago.