The Blame Game

Great. Now doctors and nurses are responsible for rising hospital charges?


Hospital costs sneak up as economy hums
Wage increases blamed, but some seek more protection for needy
Tan Hui Leng

DON'T like the heftier numbers on your hospital bill? Blame the economy. Apparently, it is doing too well.

Almost every hospital in Singapore has raised its charges — admittedly by just a handful of dollars. As the demand for healthcare professionals rises with the improving economy, hospitals' manpower costs are going up.

Noting that the majority of healthcare costs goes to human resource, National University of Singapore health economist Associate Professor Phua Kai Hong said: "Every time there is a wage increase, the first to be affected is healthcare because there are many qualified specialists there and you need to keep them from moving to the private sector."

It is not the specialists alone that are benefitting. Nurses have been asked to shoulder some of the responsibilities of junior doctors. But this came with a demand for better benefits, and they recently got a pay hike.

Health Minister Khaw Boon Wan said in Parliament two weeks back that his Ministry had to keep wages competitive to hold on to qualified professionals like nurses and speech therapists. "This is also the reason why medical fees need to be raised periodically as the cost of manpower is a major component of medical costs," he said.

But patients see only the bottomline — and they don't always like what they see.

At Singapore General Hospital (SGH), subsidised inpatients in Class B2 wards will pay $53 a day — an extra $3, or 6 per cent more — from April. Those in Class C wards will pay $26 a day, $1 more than they currently do.

SGH said that the increases are its first since 1993.

An SGH spokesman said that even though its expenses had risen steadily, the hospital had held off any fee increase until now.

And even with the hike, the hospital will recover "just a small fraction" of its rising costs, said chief executive Prof Tan Ser Kiat.

"With an increasing volume of subsidised patients, and facilities at SGH which need updating, any under-collection of revenue would mean fewer resources available for meeting the growing need for improvements necessary for sustaining quality of patient care," he said.

At National University Hospital, the accident and emergency (A&E) fee was increased from $70 to $80 in January — the hospital's first A&E fee hike since 1997.

At Alexandra Hospital, C-class ward charges went up from $21 to $23, subsidised specialist outpatient clinic consultation rates went up from $18 to $20, while A&E went up from $55 to $60; all increases took place late last year. At KK Women's and Children's Hospital, ward treatment fees also increased from last month.

Only Tan Tock Seng Hospital and Changi General Hospital have not raised their fee and now all eyes are on them.

The hospitals, themselves, did not want to comment, but NUS economist Prof Phua felt it was only a matter of time before their fees went up. "These are government hospitals, so they'll follow suit," he said.

Despite the hospitals and the Ministry offering their reasons for the hike, Dr Lam Pin Min, MP and Deputy Chairman of the Government Parliamentary Committee for Health, said he was somewhat surprised. "I was a bit shocked to see the fee revisions for the different hospitals," Dr Lam told Today.

"The timing is not very appropriate — why is there a need to increase prices when the GST hike has just been announced?"

The Government has already said that it will absorb the Goods and Services Tax hike for all subsidised patients. But, Dr Lam pointed out, that is just a two-percentage-point hike, whereas the recent rise in consultation and hospital fees appeared to be more substantial.

The Health Ministry said that the fees would remain affordable to all subsidised patients and the needy would not be denied care.

NUS health economist Prof Ake Blomqvist added that, by international standards, hospital charges in Singapore were not particularly high, especially given the quality of healthcare.

"And if there is concern about the burden that an unexpected major illness sometimes places on low-income people with limited Medisave balances and little medical insurance coverage, it is probably better to work on strengthening the safety net for those population groups specifically, rather than increasing the subsidy to all health care users, including high-income ones," he said.


Certainly wages make up a significant proportion of a healthcare cluster's annual expenditure (just a little more than 50% in both clusters - see here and here), but this is not surprising for a business where the chief commodities being sold are knowledge and skills and not goods.

Moreover, manpower cost is not the only part of the expenditure that is rising (nor the component that has seen the biggest percentage rise - do look through the annual reports for the past few years; you may be surprised...), nor are doctors and nurses the only ones on the payroll.

To single out wage increases for 'specialists' and nurses in the article and to just gloss over the other factors contributing to an increased expenditure is to do these people a disservice.