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Transferring lessons from Singapore: an art or a science?
Perspectives
Book Transferring lessons from Singapore: an art or a science? 3 years ago, a former Harvard medical professor and biotech scientistentrepreneur was astonished to discover Singapore’s remarkable health-care system. Ranked among countries with the best health outcomes, Singapore spends less of its gross domestic product (GDP) on health than any other developed economy—about half of what many western European countries spend and about a quarter of US health-care spending. Keen to spread the news, William Haseltine, now President of the non-profit think tank and consulting group Access Health International, has written Affordable Excellence: The Singapore Healthcare Story. Affordable Excellence provides a valuable account of how the Singapore health-care system has developed, how it works, and how it is financed. Haseltine focuses on Singapore’s innovative financing system, called the “3Ms”. The system attempts to generate a quasi-free market that promotes individual responsibility supported by an enabling state. Funding is generated mostly from individual savings, not a tax-based entitlement, in which private payment fuels regulated competition that enhances quality, fosters efficiency, and controls costs. Haseltine does
Getty Images
Affordable Excellence: The Singapore Healthcare Story William A Haseltine. Ridge Books, 2013. Pp 182. ISBN 9789971696641. Download at http://www. accessh.org
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not emphasise, however, that this financing system also depends upon Singaporean sociocultural values that prioritise personal saving and filial family care-sharing. The core of the 3M framework is Medisave, a mandatory medical
“Perhaps, the major lesson from Singapore is the need to constantly rebalance failures of both the market and the state. ” savings account for residents; employees and employers contribute an equal percentage of wages to savings that are accumulated to pay for health-care expenses. Singapore’s two other supplemental plans are MediShield and Medifund: the former a voluntary opt-out insurance for financial protection against catastrophic illness and the latter a safety-net covering the indigent funded by government endowment. 3M funds are paid to Singapore’s public and private hospitals that are structured with incentives and price control—public hospitals have different ward classes and the private sector has to compete against the subsidised public sector. Most prices
are made transparent to the public, apart from private medical fees. The number and type of practitioners and quantity and use of new medical technologies are regulated to reduce supply-induced demand. In searching for transferable lessons from Singapore, however, Haseltine leaves some questions unanswered. Which of Singapore’s lessons are worthy of dissemination? Under what conditions can Singapore’s lessons be transferred to the world’s diverse countries? Some commentators present Singapore‘s health-care system as an ideal example of managed capitalism, in which informed consumers are incentivised to keep down costs. By contrast, others question the role of private markets in health care and argue that Singapore’s system is inferior to European taxed-based health systems that promote social solidarity. Yet both views oversimplify the complexity of the Singapore system. To contrast markets with social solidarity unnecessarily polarises the Singapore story. Although Singapore’s Government targets its tax revenues (30% of total health spending) towards public health and subsidised primary care to those with lower incomes, it provides 80% of the hospital services and recovers 50–60% of the public spending via private savings from the 3M. But means testing, hospital ward classes, and differentiated pricing target the poor. So, the contrast is different routing of expenditures coming from tax-exempt savings or general taxation. Medisave by itself is regressive, and must therefore be backed up by MediShield for health catastrophes and Medifund for the poor. European national health systems try to cover everyone but carry the moral hazards of overuse and demand rationed by professional norms and waiting lists. www.thelancet.com Vol 382 September 14, 2013
Perspectives
The Singapore and European systems are not diametrical opposites of efficiency versus equity, only differing incentive structures with a different social compact of cost sharing. In August, 2013, the Singapore Government announced a new MediShield Life plan that provides compulsory universal health coverage for life, which includes cover for preexisting illnesses and a subsidy for the poor. This plugs the last major gap of universal health insurance in Singapore, as the 3M framework shifts from individual responsibility to shared responsibility of the individual and the state. This recent state action itself negates Haseltine’s argument that competition and free market forces have led to affordable excellence in Singapore, short of regular government interventions to correct for market failures. Haseltine assumes that Singapore’s lessons come out of its medical system, but the wider social determinants of health have had an important role. Early national priorities in Singapore did not emphasise medical care but rather political unity, a prosperous economy, and an efficient and corruption-free government. Policies to promote jobs, housing, infrastructure, water, sanitation, and a green environment were advanced, while a Central Provident Fund eventually became the building block for old age security, home ownership, higher education, and medical care. Women enjoy gender equality in education and work, enshrined by the 1960 Women’s Charter. How much of Singapore’s positive performance, therefore, should be attributed to these social determinants of health, and not just the medical system? Even within the medical system, Haseltine short-changes Singapore’s hidden success in primary care. Virtually all citizens have access to cost-effective primary care with multifunctional polyclinics that cover public housing estates. www.thelancet.com Vol 382 September 14, 2013
Although about 80% of primary care is provided by private practitioners, there are public subsidies, such as the community health assistance scheme for those with low incomes. The Health Promotion Board provides outpatient, maternal and child health, school, and elderly services and intensive national health campaigns, which all target common diseases and promote healthy lifestyle. Rather than focusing on financing or hospitals, a powerful lesson from Singapore is surely its remarkable system of primary health care and public health. Can other countries learn lessons from Singapore? To claim that a country is unique shuts down the possibilities of learning good and bad lessons. Believing that any lesson can be transferred indiscriminately to all countries is naive. The truth undoubtedly lies somewhere in between. Haseltine believes that Singapore has lessons for emerging countries that are planning their future health-care systems and for highincome countries seeking to enhance quality and control costs for ageing populations with non-communicable diseases. But analysing which lessons can be transferred among which countries may be as much an art as hard science. Singapore is unique, of course: a small city-state with a stable government, a financial and trading centre, and an open meritocratic society. As such, Singapore’s lessons are not transferable to large countries with unstable governments, low rates of employment, or many informal sector workers. Few countries can match the conditions in Singapore. Other Asian countries such as Japan, South Korea, Thailand, and China, including Taiwan, have performed fairly well using a social health insurance or tax-based system. Historically, Hong Kong like Singapore inherited a strong health system from the British and its current taxbased system generates good health outcomes but the government spends
more on health care than Singapore with twice the rate of per person hospital utilisation. Singapore’s previous public spending in a national health service model and its relative success in public health are rather similar to the present health systems in Hong Kong, Sri Lanka, and Malaysia (from which it was separated in 1965), all former British colonies. Affordable Excellence offers a clear account of the health system in Singapore that might provoke deeper thinking about which of Singapore’s lessons are truly transferable elsewhere. At times, Haseltine waxes lyrical about Singapore’s health-care story with some oversimplification of what the system is supposed to do rather than what it has done and what remains to be done. The book’s last chapter on the future, interestingly, is devoted to how Singapore is gearing up for a rapidly ageing population burdened by non-communicable diseases—a profound transition shared by all of Asia. Perhaps, the major lesson from Singapore is the need to constantly rebalance failures of both the market and the state. As Jeremy Lim argues in his new book, Myth or Magic: the Singapore Healthcare System, good governance has a critical role in determining the health of people. Indeed, the latest introduction of MediShield Life attests to the role of such governance in Singapore. The ultimate lesson from Singapore’s health story might not be its past accomplishments but its forwardlooking anticipation, preparation, and management for the future.
*Lincoln C Chen, Kai Hong Phua China Medical Board, Cambridge, MA 02138, USA (LCC); and Lee Kuan Yew School of Public Policy, National University of Singapore, Bukit Timah, Singapore 259772 (KHP) [email protected] LCC and KHP declare they have no conflicts of interest. KHP was interviewed by William Haseltine during research for Affordable Excellence: The Singapore Healthcare Story but had no direct involvement in this book.
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Book Transferring lessons from Singapore: an art or a science? 3 years ago, a former Harvard medical professor and biotech scientistentrepreneur was astonished to discover Singapore’s remarkable health-care system. Ranked among countries with the best health outcomes, Singapore spends less of its gross domestic product (GDP) on health than any other developed economy—about half of what many western European countries spend and about a quarter of US health-care spending. Keen to spread the news, William Haseltine, now President of the non-profit think tank and consulting group Access Health International, has written Affordable Excellence: The Singapore Healthcare Story. Affordable Excellence provides a valuable account of how the Singapore health-care system has developed, how it works, and how it is financed. Haseltine focuses on Singapore’s innovative financing system, called the “3Ms”. The system attempts to generate a quasi-free market that promotes individual responsibility supported by an enabling state. Funding is generated mostly from individual savings, not a tax-based entitlement, in which private payment fuels regulated competition that enhances quality, fosters efficiency, and controls costs. Haseltine does
Getty Images
Affordable Excellence: The Singapore Healthcare Story William A Haseltine. Ridge Books, 2013. Pp 182. ISBN 9789971696641. Download at http://www. accessh.org
930
not emphasise, however, that this financing system also depends upon Singaporean sociocultural values that prioritise personal saving and filial family care-sharing. The core of the 3M framework is Medisave, a mandatory medical
“Perhaps, the major lesson from Singapore is the need to constantly rebalance failures of both the market and the state. ” savings account for residents; employees and employers contribute an equal percentage of wages to savings that are accumulated to pay for health-care expenses. Singapore’s two other supplemental plans are MediShield and Medifund: the former a voluntary opt-out insurance for financial protection against catastrophic illness and the latter a safety-net covering the indigent funded by government endowment. 3M funds are paid to Singapore’s public and private hospitals that are structured with incentives and price control—public hospitals have different ward classes and the private sector has to compete against the subsidised public sector. Most prices
are made transparent to the public, apart from private medical fees. The number and type of practitioners and quantity and use of new medical technologies are regulated to reduce supply-induced demand. In searching for transferable lessons from Singapore, however, Haseltine leaves some questions unanswered. Which of Singapore’s lessons are worthy of dissemination? Under what conditions can Singapore’s lessons be transferred to the world’s diverse countries? Some commentators present Singapore‘s health-care system as an ideal example of managed capitalism, in which informed consumers are incentivised to keep down costs. By contrast, others question the role of private markets in health care and argue that Singapore’s system is inferior to European taxed-based health systems that promote social solidarity. Yet both views oversimplify the complexity of the Singapore system. To contrast markets with social solidarity unnecessarily polarises the Singapore story. Although Singapore’s Government targets its tax revenues (30% of total health spending) towards public health and subsidised primary care to those with lower incomes, it provides 80% of the hospital services and recovers 50–60% of the public spending via private savings from the 3M. But means testing, hospital ward classes, and differentiated pricing target the poor. So, the contrast is different routing of expenditures coming from tax-exempt savings or general taxation. Medisave by itself is regressive, and must therefore be backed up by MediShield for health catastrophes and Medifund for the poor. European national health systems try to cover everyone but carry the moral hazards of overuse and demand rationed by professional norms and waiting lists. www.thelancet.com Vol 382 September 14, 2013
Perspectives
The Singapore and European systems are not diametrical opposites of efficiency versus equity, only differing incentive structures with a different social compact of cost sharing. In August, 2013, the Singapore Government announced a new MediShield Life plan that provides compulsory universal health coverage for life, which includes cover for preexisting illnesses and a subsidy for the poor. This plugs the last major gap of universal health insurance in Singapore, as the 3M framework shifts from individual responsibility to shared responsibility of the individual and the state. This recent state action itself negates Haseltine’s argument that competition and free market forces have led to affordable excellence in Singapore, short of regular government interventions to correct for market failures. Haseltine assumes that Singapore’s lessons come out of its medical system, but the wider social determinants of health have had an important role. Early national priorities in Singapore did not emphasise medical care but rather political unity, a prosperous economy, and an efficient and corruption-free government. Policies to promote jobs, housing, infrastructure, water, sanitation, and a green environment were advanced, while a Central Provident Fund eventually became the building block for old age security, home ownership, higher education, and medical care. Women enjoy gender equality in education and work, enshrined by the 1960 Women’s Charter. How much of Singapore’s positive performance, therefore, should be attributed to these social determinants of health, and not just the medical system? Even within the medical system, Haseltine short-changes Singapore’s hidden success in primary care. Virtually all citizens have access to cost-effective primary care with multifunctional polyclinics that cover public housing estates. www.thelancet.com Vol 382 September 14, 2013
Although about 80% of primary care is provided by private practitioners, there are public subsidies, such as the community health assistance scheme for those with low incomes. The Health Promotion Board provides outpatient, maternal and child health, school, and elderly services and intensive national health campaigns, which all target common diseases and promote healthy lifestyle. Rather than focusing on financing or hospitals, a powerful lesson from Singapore is surely its remarkable system of primary health care and public health. Can other countries learn lessons from Singapore? To claim that a country is unique shuts down the possibilities of learning good and bad lessons. Believing that any lesson can be transferred indiscriminately to all countries is naive. The truth undoubtedly lies somewhere in between. Haseltine believes that Singapore has lessons for emerging countries that are planning their future health-care systems and for highincome countries seeking to enhance quality and control costs for ageing populations with non-communicable diseases. But analysing which lessons can be transferred among which countries may be as much an art as hard science. Singapore is unique, of course: a small city-state with a stable government, a financial and trading centre, and an open meritocratic society. As such, Singapore’s lessons are not transferable to large countries with unstable governments, low rates of employment, or many informal sector workers. Few countries can match the conditions in Singapore. Other Asian countries such as Japan, South Korea, Thailand, and China, including Taiwan, have performed fairly well using a social health insurance or tax-based system. Historically, Hong Kong like Singapore inherited a strong health system from the British and its current taxbased system generates good health outcomes but the government spends
more on health care than Singapore with twice the rate of per person hospital utilisation. Singapore’s previous public spending in a national health service model and its relative success in public health are rather similar to the present health systems in Hong Kong, Sri Lanka, and Malaysia (from which it was separated in 1965), all former British colonies. Affordable Excellence offers a clear account of the health system in Singapore that might provoke deeper thinking about which of Singapore’s lessons are truly transferable elsewhere. At times, Haseltine waxes lyrical about Singapore’s health-care story with some oversimplification of what the system is supposed to do rather than what it has done and what remains to be done. The book’s last chapter on the future, interestingly, is devoted to how Singapore is gearing up for a rapidly ageing population burdened by non-communicable diseases—a profound transition shared by all of Asia. Perhaps, the major lesson from Singapore is the need to constantly rebalance failures of both the market and the state. As Jeremy Lim argues in his new book, Myth or Magic: the Singapore Healthcare System, good governance has a critical role in determining the health of people. Indeed, the latest introduction of MediShield Life attests to the role of such governance in Singapore. The ultimate lesson from Singapore’s health story might not be its past accomplishments but its forwardlooking anticipation, preparation, and management for the future.
*Lincoln C Chen, Kai Hong Phua China Medical Board, Cambridge, MA 02138, USA (LCC); and Lee Kuan Yew School of Public Policy, National University of Singapore, Bukit Timah, Singapore 259772 (KHP) [email protected] LCC and KHP declare they have no conflicts of interest. KHP was interviewed by William Haseltine during research for Affordable Excellence: The Singapore Healthcare Story but had no direct involvement in this book.
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