Keynote address by Dr Lam Pin Min, Minister of State for Health, at the Commonwealth Fund International Symposium on Health Care Policy, 20 November 2014

Building a Nation for All Ages-

Transforming Singapore’s Healthcare System for the Future”

Distinguished guests,

Ladies and Gentlemen,

1.            Good evening. First and foremost, I would like to thank the Commonwealth Fund for the kind invitation to speak at this distinguished symposium. It is my honour to deliver this address in memory of the late Dr. John Eisenberg, one of your most renowned and influential researchers and policymakers.

2.            America, and many other countries in the developed world, are going through significant healthcare reform. This comes at a time when the world economy has been going through a difficult period, and governments are facing great fiscal pressures. It is my pleasure to be able to share the experience of Singapore, and some lessons we have learnt along the way. 

3.            First, allow me to share some background about our country and healthcare system. Singapore is a small island city-state, with a population of about 5 million. Some of our key healthcare indicators are shown on the slide. Our average life expectancy has improved from around 60 years in the 1950s, to 82 years in 2013. According to the latest World Health Statistics 2014, we are ranked 5th in the world for life expectancy in men and 4th for life expectancy in women. In 2011, we were ranked 6th out of 191 countries on overall health system performance by the Economist Intelligence Unit Liveability Rankings.

4.            All countries strive to develop a healthcare system that is universal in coverage and effective, and yet sustainable for future generations. In achieving these three aims, trade-offs necessarily have to be made. In Singapore, we have managed to achieve relatively good healthcare outcomes at relatively low costs, spending about 4% of our GDP on healthcare. We have done this by embracing a healthcare philosophy founded on three key pillars.

5.            First, we emphasize that individuals must take responsibility for their own health. We promote healthy living among the populace, such as healthy eating and exercising, and regular health screening, to address preventable causes of disease. In our healthcare financing, we maintain the principle of co-payment by individuals for healthcare, which helps to mitigate against the risk of the “buffet syndrome” and over-consumption. This is a difficult choice that we made early on, based on the reality that there is no “free lunch”, and in all instances, it is the people who are paying for healthcare, whether through higher taxes, premiums, or payroll contributions.

6.             Second, accessibility and affordability. The government has invested heavily in building up accessible healthcare services, ranging from preventive and public health services to primary care and tertiary care, and in manpower development so we have the right number of healthcare professionals with the right skills and capabilities to meet the healthcare needs of Singaporeans.

7.            We provide generous government subsidies of up to 80% for public healthcare services, targeted especially at lower-income Singaporeans through means-testing. Supporting this is our fundamental “3Ms” healthcare financing framework, on top of government subsidies. The “3Ms” stands for Medisave, MediShield and MediFund. Through these multiple layers of protection – subsidies and the 3Ms, we achieve universal coverage of our population. Let me show you a short video clip that summarizes how our system works.

8.            As mentioned in the video, Medisave, is a personal Health Savings Account that all Singapore citizens have. It is funded from mandatory employer and employee contributions. Medisave can be used for hospitalization expenses,  outpatient expenses such as treatment of chronic diseases like diabetes, as well as certain preventive services like vaccinations and cancer screening. It can also be used to pay premiums for health and severe disability insurance. While Medisave is a personal account, it can also be used for the medical expenses of immediate family members.

9.            Our second “M”, MediShield, is a basic national health insurance scheme, which protects against large catastrophic healthcare expenses. MediShield can be used to pay for hospitalization bills, day surgery and selected expensive outpatient treatments. Premiums for MediShield can be paid from citizens’ Medisave accounts. There are also deductible and co-insurance features in MediShield to guard against over-consumption, and to keep premiums affordable. On top of generous government subsidies, this insurance scheme helps to further improve affordability by enabling the population to risk-share among unhealthy and healthy.  While subsidies are financed through general taxes, insurance helps to make part of healthcare costs more explicit to the public, and engenders a stronger sense of shared responsibility and the need for tradeoffs between increased coverage and higher premiums.  We will be introducing an enhanced version of Medishield – called Medishield Life – next year. I will go into that later.

10.         Even while emphasizing individual responsibility, we also want to ensure that no citizen is denied healthcare due to the inability to pay. We thus set up Medifund, an endowment fund that acts as a safety net for needy Singaporeans who are unable to pay their medical bills after taking into account subsidies, Medisave, and MediShield.  

11.         Thirdly, we enable markets to work in healthcare, by relying on market mechanisms where possible, and encouraging greater transparency in pricing and outcomes. In Singapore, the majority of primary care is provided in the private sector, whilst the public sector hospitals provide the majority of expensive specialist and hospital care. Long-term and community based care are provided largely by charities, with government support and subsidies. Our decision to corporatize formerly government-run hospitals and polyclinics has enabled public services to be delivered in a cost- conscious manner, and to act as benchmarks for the private sector.  In line with the emphasis on personal responsibility, we have also promoted transparency of healthcare charges to support informed choice by patients. Since 2003, we have been publishing hospital bill sizes for the most common conditions, together with the volume of cases and the average length of stay.  We are now moving towards transparency of outcomes as well.

12.         To keep our system sustainable, we are also putting in place various measures to contain costs. In public sector hospitals, we encourage through subsidies the use of drugs which have proven clinical efficacy and cost effectiveness. Given the large number of medical devices being introduced into Singapore each year, we have introduced a similar Health Technology Assessment process for medical devices and implants to ensure they are both clinically- and cost-effective. We are also working with the public hospitals to set up Medical Device Committees to ensure rational selection and utilisation of new medical devices, similar to the existing committees for drugs.

13.         To measure and improve the quality of our public healthcare services, The Ministry of Health, or MOH in short, set up a National Performance Measurement framework. This comprises the national-level National Health System Scorecard, which is then cascaded to setting- and provider/ specialty-level scorecards. The Scorecards leveraged extensively on internationally-established measures and definitions such as those developed under the OECD Healthcare Quality Indicator (HCQI) Project and the CMS’ Core Measure Sets. This allows MOH to benchmark Singapore’s performance internationally on a ‘like-for-like’ basis, enabling us to identify areas where we are doing well, and where improvements are needed. ‘All or None’ measurement is also used to drive consistent, high quality and reliable care to patients in our public hospitals. Implemented for common conditions such as heart attack and stroke, we are in the process of extending this to other conditions. In addition, all our public hospitals, and most private hospitals, are JCI-accredited.

14.         In summary, we take a pragmatic and practical approach in structuring our healthcare system.  Where possible, we leverage on market-based mechanisms, supported by performance measurement so that healthcare providers have the incentive to provide quality care in a cost-conscious manner.  Individuals are incentivised to stay healthy, save for their medical expenses and avoid using more healthcare services than needed, whilst help is given to the needy so no one is denied healthcare due to lack of funding.  On the whole, we are not perfect but believe we have managed to strike a delicate balance between the outcomes of accessibility, affordability, quality and sustainability.

15.         However, we recognise that many challenges lie ahead. Foremost among those challenges is that of the ageing population. The percentage of our population aged 65 and above is about 10% today; that is projected to double to 20% by 2030. This is due to falling fertility rates, coupled with increased life expectancy.

16.         Ageing will be a major driver of future healthcare demand across the entire healthcare spectrum, as seniors have both greater acute care needs, as well as greater chronic and long-term care needs. The theme of this symposium is “Caring for High Need- High Costs Patients”. Many of such patients are frail elderly patients who have multiple chronic conditions, physical disabilities, or dementia, while facing inadequate social support. I would like to share with you how Singapore is planning to meet the needs of the ageing population.

17.         First of all, while ageing presents numerous challenges, we also want to recognise that ageing is also an opportunity with potential benefits for all.  We envision an alternative scenario, one of productive longevity- one where longer years of life is translated into longer years in active ageing, such as in the community or workplace, where we look beyond chronological ages to keeping our seniors functionally and cognitively independent for as long as possible and seniors spend many happy, fulfilling years free of disability. To succeed, we need a shared vision across the whole of government, not just MOH alone.  In short, our vision is to build a Nation for All Ages.

18.         To achieve this vision, we are developing an ambitious, whole-of-government action plan for successful ageing. This holistic plan will cover 7 diverse areas- lifelong learning for seniors, employment, volunteerism, urban infrastructure, healthcare, retirement adequacy, and research into ageing.

19.         We had earlier made a start on this initiative to build a nation and city that is friendly to seniors. Through our City for All Ages project, we aimed to create a ground-up people movement across the island to build an inclusive and caring environment in every town. CFAA has provided a platform for local communities to find out the needs of the seniors in their communities and implement ground-up initiatives to address these needs. This includes working closely with the grassroots leaders, volunteers, government agencies, healthcare providers, non-profit organizations and other organisations within the communities to address not just healthcare but social and infrastructural needs, for example identifying locations with fall hazards and making improvements in safety for seniors, and retro-fitting seniors’ homes with elderly-friendly features.

20.         In the area of healthcare, we recognise that a fundamental paradigm shift is required in meeting the needs of our ageing population. Our healthcare system has been built on our acute hospitals, which have served the more acute, episodic healthcare needs of a younger population well in the past. However, as our population ages, our seniors’ needs will become more chronic, social, preventive, rehabilitative and palliative in nature, needs which our acute hospitals are not best suited to serve.  As medicine becomes more specialised and sub-specialised, we also need to re-focus care to become truly patient-centred. 

21.         We therefore we need a fundamental transformation of our healthcare system, to be less reliant on our acute hospitals, and to provide more integrated, patient-centric care across many different sectors including primary care, community and home care. We want to support our seniors to age-in-place in the community, instead of being institutionalised, as long as they can.

22.         We are therefore aggressively expanding the capacity of our community-based services like nursing homes, day care, home and centre-based care services, to support seniors ageing-in-place. To achieve integrated, patient-centric care across the health and social spectrum, we have re-organized our healthcare system into six Regional Health Systems, each serving a particular region of Singapore. Each RHS is a developing network of healthcare facilities and providers, including a public sector acute hospital, community hospitals, nursing homes, day care centres, primary care clinics, and home care services, that serves a particular region of Singapore. The goal of the RHS is to orchestrate holistic, patient-centred care across the entire healthcare continuum within the population it is accountable for, and promoting preventive care to keep its assigned population healthy. Within each RHS, patients should flow seamlessly between providers and be cared for at the most appropriate setting. The public sector hospitals and polyclinics play an important role in driving the development of the RHS and in building up the capabilities of the primary and community care providers.

23.         We are piloting programmes that aim to meet the needs of and achieve specific outcomes for specified vulnerable groups in the community, similar to accountable care models in the US. One example is the Singapore Programme for Integrated Care for the Elderly (SPICE) programme, modelled after the Programme of All-inclusive Care for the Elderly or PACE developed by On Lok in San Francisco. SPICE provides personal, rehabilitative, nursing and medical day care at community based centres, and home care services to allow frail elderly to remain in the community instead of in an institution. This program was recently featured in the Health Affairs journal.

24.         Another example is the pilot Ageing-In-Place programme, run by one of our Regional Health Systems, Alexandra Health System, that recently won the UN Public Service Award. Here allow me to play a video that sums up nicely the goals of the programme and what it has achieved.

25.         I hope you enjoyed that video. The Ageing-in-Place programme is a good example of an initiative that has helped seniors to remain in the community, while reducing overall healthcare costs. However, the complex nature of the healthcare system, with multiple stakeholders and providers, and numerous transition points between care settings, presents continuing challenges for integration of care.

26.         A key enabler in our efforts has therefore been the Agency for Integrated Care (AIC), which we set up in 2009 to oversee, coordinate and facilitate efforts in care integration. AIC has multiple roles. It serves as the central referral agency, assessing patients’ needs and placing them to appropriate community services using a single common IT platform. It seeds and nurtures care coordinators in hospitals who identify vulnerable patients, coordinate post-discharge care arrangements including health and social care, and follow up with patients in the community post-discharge. AIC also pilots programmes like the SPICE programme mentioned earlier, and fosters organisational integration within the Regional Health Systems through the resourcing of key priority areas, creation of platforms for multi-stakeholder discussion, and sharing of best practices across institutions. Finally, it supports capacity growth and capability development in the primary and community care sectors, to ensure that end-to-end integrated care can occur.

27.         Information technology is another critical enabler for integrated, patient-centric care. It has the potential to close gaps between providers and facilitate integrated care. Since 2009, we have worked to put in place the National Electronic Health Record (NEHR) as a first step towards realizing the vision of “One Patient, One Health Record”. This enables providers from all settings to electronically access patients’ health information and history, and hence make better informed decisions about their care. It also provides a platform for better collaboration between physicians in different sectors.

28.         We are also developing tele-health services to bring services closer to patients and their families. For example, tele-rehabilitation allows stroke patients to perform rehabilitative exercises or physiotherapy in the comfort of their own homes. The Singapore Integrated Diabetic Retinopathy programme provides a centralised tele-ophthalmic service for screening of diabetic patients at public sector polyclinics for diabetic retinopathy. In addition, one of our public hospitals has embarked on a pilot to monitor diabetic patients at home with glucometers and blood pressure meters to capture the readings and transmit them into the Electronic Medical Record.

29.         Finally, we are also evolving our financing framework to meet the needs of an ageing population. As mentioned earlier, and in the video, we are enhancing the MediShield scheme to MediShield Life. While MediShield was previously an opt-out scheme, MediShield Life will provide lifelong and universal coverage for all Singaporeans, regardless of age, and with no exclusion for pre-existing illness. This will provide assurance for all Singaporeans that they will have health insurance coverage for life, regardless of how their life and health circumstances change over time and in their old age.

30.         MediShield Life will also offer better protection for large bills, through increased claim limits and lower co-insurance. We have also lifted the lifetime claim limit. In this respect, MediShield Life bears some similarity to European universal social insurance systems, as well as reforms in the American Affordable Care Act that aim to expand coverage to uninsured individuals and raise claim limits. But we are cognizant of the need to constantly guard against the risk of over-consumption. We have maintained our fundamental principle of patient responsibility, through retaining deductible and co-insurance payment features in MediShield Life. This also helps to keep premiums affordable.

31.         Earlier this year, the Government announced the special Pioneer Generation Package, which aims to recognise the contributions of the pioneering generation of Singaporeans who built our nation in the early years after our Independence in 1965, and give them greater peace-of-mind over their healthcare costs in old age. Beneficiaries of the package will receive significant subsidies for their MediShield Life premiums and annual Medisave top-ups, as well as additional subsidies for primary care and outpatient treatments at public healthcare institutions. In addition to this, pioneers with moderate to severe functional disabilities will receive additional cash assistance.

32.         Both MediShield Life and the Pioneer Generation Package come on top of our regular review of long-term care affordability, to ensure our seniors are able to pay for long-term care if they need to. In 2012, we significantly enhanced the government subsidy framework for intermediate and long term care to cover all lower and middle income households.

33.         We are also reviewing our ElderShield scheme. ElderShield is a national scheme that provides affordable severe disability insurance to help with long-term care costs. If the insured cannot perform 3 or more of the 6 Activities of Daily Living, such as bathing, dressing and feeding, they are entitled to cash payouts, which give families the flexibility to choose the most appropriate type of care services, whether informal of formal. We are reviewing the key design parameters of ElderShield to ensure that payouts keep pace with rising costs.

34.         In all these efforts, we remain careful to maintain the delicate balance between affordability, accessibility and sustainability. For example, we are carefully calibrating the increased benefits of insurance with the inevitable rise in premiums. We are also maintaining our philosophy of targeting government help at the most needy. Our system not only has higher subsidies for healthcare services for the lower-income, it also has higher subsidies for insurance premiums.  So we are also strengthening the progressivity in the system.  

35.         However, making these changes will not be easy.  They require mind-set changes on the part of our providers, who are used to providing care within their own institutions, rather than integrating care across institutions and into the community.  They also require mind-set changes on the part of the population, who feel that they need the “best care available”, perceived to be found in the acute hospitals, rather than the “best care suitable for them”, which could be in their own homes.   Last but not least, it requires a mind-set shift within our Health Ministry – a willingness to experiment with different care models, an openness to failure, and the ability to learn quickly and start again. In this respect, we have learnt a lot from new healthcare models and innovations in your countries, and hope to continue to do so.

36.         In conclusion, Singapore has come a long way in the past fifty years, through a practical and pragmatic approach to healthcare. We are significantly evolving our system, while building on our past strengths, to meet the needs of an ageing population, and build a Nation for All Ages.

37.         Thank you.


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