The Singapore health story: Balancing market forces with state intervention Feb 17, 2015

The Singapore health story: Balancing market forces with state intervention

At the opening of the Ministerial Meeting on Universal Health Coverage in Singapore on 10 February, Dr. Margaret Chan, Director General of the World Health Organization (WHO), lauded Singapore for achieving “first-rate health care, with outstanding health outcomes, at a cost lower than in any other high-income country in the world.”

The Singapore healthcare success story, according to Chan, is anchored on balancing the advantages of competitiveness and other market forces with the need for state intervention.

”There is no free lunch. The plan works to protect against the over-consumption of care,” Chan cited. “UHC in Singapore has worked as a strategy for building an inclusive, caring, and progressive society. These are assets for any country in the world.”

The WHO director-general emphasized, however, that UHC is intrinsically country-owned. “To work well,” she said, “it must be home grown in line with each country’s culture, domestic political institutions, the legacy of the existing health system, and the expectations of citizens.”

All of these outcomes require deliberate policy decisions, she added.

In his address to the Ministerial Meeting, Singapore Prime Minister Lee Hsien Loong, outlined the policies that the city-state adopted to achieve universal health care.

“Enabling citizens to live full and healthy lives is one of the most important responsibilities of the government. Firstly, because good health is fundamental to the happiness, fulfillment and dignity of every human being. Secondly, because good health is a public good,” he said. 

“Thirdly,” he added, “good health is a basis for the nation’s prosperity and success. Healthy children learn better. They have a much better chance to improve their lives. Healthy adults contribute to the workforce better and are more able to take care of their family and loved ones.”

He emphasized, though, that good health for the whole population is very challenging to achieve. Here are some of the cornerstones of Singapore’s health policy that guided it across the years:

1. Protecting patients from medical costs is a moral hazard - the Prime Minister stressed said that once your protect people from the financial consequences of medical treatments, either through generous insurance plans or a state-funded healthcare system they will seek more treatment than they need and doctors, too, will be insecticides to over-treat. 

Today, he said Singapore is spending about 4.2 percent of its GDP on healthcare and the share of the government is 1.6 percent of GDP. 

“Less than half, more than a third. It is overall remarkably low,” he said. “We need to use a variety of instruments: pricing, regulation, incentives, system design, public and private engagement efforts, exhortation as well as sometimes compulsion. And all to shape behavior – by doctors, patients, administrators, drug suppliers – in order to produce a good collective outcome,” he said.

2. Focus on public health - Singapore has invested in basic sanitation, instituted compulsory vaccination and inoculation of children, and invested in education heavily.

“We embarked on a major public housing program. There is a big difference between sharing a bed space in a crowded slum in Chinatown and owning an HDB flat with running potable water and modern sanitation. So the first thing we did was not medical care in the hospitals but public health,” the Minister said.

3. Individuals need to take personal responsibility for their health - Singapore has mounted public health campaigns to help raise awareness of the risks of an unhealthy lifestyles. These include promoting healthier choices for food, promoting regular exercise or tightening restrictions on unhealthy behavior like smoking.

“We are building a clean and green Singapore, with access to healthy lifestyle activities – parks, exercise corners, cycling tracks even as our city becomes more densely built-up. We are encouraging an active lifestyle within the communities, especially among senior citizens,” the Minister said.

4. Marrying the best of privatized healthcare system with that the best aspects of a single-payer models. - Like most nations, the Minister emphasized that Singapore started out with healthcare fully provided by the state, except that early on there was payment for hospital charges or partial co-payment. This is to ensure that “people valued the medicine that was prescribed and they will not just take the medicine home, take two pills, throw away the rest of the packet, and come back to ask for more.”

Today, the right balance in healthcare is achieved by financing between individuals and the government, between savings and insurance and government subsidies. 

“It is a system which is dynamic and which has evolved over time. We have government subsidies. They are generous; they are tilted towards the lower-income patients. We make sure that everyone has access to good healthcare, including the poor and vulnerable,” the Minister said.
UHC as a social equalizer

Dr. Chan stressed that UHC is one of the most powerful social equalizers among all policy options. It is the ultimate expression of fairness. 

“If public health has something that can help our troubled, out-of-balance world, it is this: growing evidence that well-functioning and inclusive health systems contribute to social cohesion, equity, and stability. They hold societies together and help reduce social tensions,” she said.

Admittedly, Singapore story is its own. Minister Lee Hsien Loong said it is by no means the only way to do it. 

“There is no country in the world which considers itself to have reached nirvana, although every country always believe somebody else has a better system,” he said.

Dr. Chan herself shared the story of Bangladesh, which aimed for universal health coverage for a vast and very poor population through high-impact interventions.

“To compensate for a severe shortage of doctors and nurses, the country trained and then closely supervised a brigade of community health workers, mostly women, who followed a doorstep-delivery approach. The country also used its world-class research capacity to experiment with innovations. Formal and contractual arrangements were made with nongovernmental organizations that were best placed to win community trust and reach marginalized populations. Improvements in school enrolment, especially for girls, and in agriculture brought huge benefits for health,” Dr. Chan said.

She added that the Bangladeshi government built and ran nearly 12,000 strategically located community clinics. Policies were also instituted to create a strategic bias towards the need of some and girls, including sexual and reproductive health services. 

“The approach led to a stunning reversal in excessive mortality of girls compared with boys,” Dr. Chan said.  “Health is likely one of the most precious commodities in life. But it is highly political and it requires investment,” she concluded.