Subsidy and Other Preoccupations 13

Yet another letter to the press on the subject of means testing:


By all means, add subsidised beds
Letter from Lan Zhong Zheng

I concur with the opinion of the reader who wrote the letter, "More hospital beds the remedy" (April 26).

Indeed, from my fleeting hospital attachment at one of the restructured hospitals in Singapore, I managed to catch a glimpse of the crunch faced by government hospitals here.

There was an appalling paucity of available beds in the heavily subsidised wards, while the exact opposite was obvious in the "paying patient" wards.

There were even instances where subsidised patients in the Intensive Care Unit (ICU) were transferred to a Class A ward, just to squeeze out a bed in the ICU for someone whose condition was believed to be more dire and life-threatening.

The ultimate solution is not to carry out means testing on Singaporeans but to increase the supply of beds in the subsidised wards in hospitals here. Implementing means testing infringes on the right of the people to choose.

Does it mean a tycoon should be barred from a superior room and can only stay in a suite? Similarly, why should the middle-income not be given the option of staying in a Class C ward? Being in the middle-income group does not definitely mean one has the money to splurge on a class B1 or A ward.

Looking into supply should be the long-term solution in addressing this shortage. However, as we all know, land is scarce and government hospitals are stretched to their full capacity in terms of facilities and resources.

Rather than diversifying interests by trying to usurp a slice of the burgeoning medical tourism market, the Health Ministry should draw on the HDB model, which sets out to provide public housing to Singaporeans first, especially the less well-off ones. Drawing on this model, healthcare should be focused on catering to the individual needs of Singaporeans, in particular the subsidised pool of patients rather than having to attract foreign wealthy "paying patients" at the same time.

Means testing may bring instant temporal relief to the current situation but with an ageing population and such uncertain times, no one knows when epidemics like Sars will rear its head again. The bed crunch in hospitals may pose a more serious problem then.


Despite our low beds ratio, angry doc is still not convinced that the root problem here is an absolute bed shortage. In fact, the account given in the letter of subsidised patients being lodged in A-class wards tells us that there are beds available in the hospital.

Nor is the problem one of relative bed shortage alone.

In its currently proposed form, means testing does not forbid one from staying in a C-class ward: it merely reduces the percentage of subsidy a patient who fails the means test receives (to less than 80%, but presumably more than 65%). If the patient accepts the lower subsidy, he may still stay in a C-class ward.

So what is the purpose of means testing then?

Is it "to better target our subsidies at those who need them most"?

If so, does that mean that subsidy for those who pass the means test will be increased to more than the current 80%?

Or, is it to achieve "right-siting"?

If so, means testing seems to be too imprecise a tool to achieve that, since it does not take into account whether or not a patient needs to stay in an acute hospital.

angry doc is, once again, confused. Perhaps all the letters to the press published in the past few weeks will prompt a reply from the ministry which will answer all his questions.

Subsidy and Other Preoccupations 12

An interesting letter to Today today which attempts to look at the issue of means testing using statistics:


More hospital beds the remedy
Means testing: Are S'poreans abusing medical system or is capacity just insufficient?
Letter from Tony Tan Kok Tee

I read with concern recent news articles on the planned means testing in hospitals here, presumably because our lower-class hospital wards are overcrowded.

The question is, what is the root cause? Is it due to Singaporeans abusing the system, or insufficient hospital beds?

According to the World Health Organization's World Health Report 2006, the number of hospital beds ratio in Singapore (in 2004) is only 28 per 10,000 population. Countries with similar Gross National Product (GNP) per capita as Singapore have a much higher hospital beds ratio than Singapore.

In the 2007 PriceWaterHouseCoopers study on global cities, Singapore also scored badly in this area.

Among the four Asian dragons, the Republic of Korea led the way with 89 hospital beds per 10,000 population, followed by Taiwan (48 beds), Hong Kong (47 beds) and Singapore (28 beds).

Among the countries with US$20,000 ($30,200) to US$40,000 GNP per capita as indicated by the International Monetary Fund, only five countries had fewer than 30 hospital beds per 10,000 population in 2003/04. They are Kuwait (21 beds), the United Arab Emirates (22), Brunei (26), Bahrain (28) and Singapore (28).

Since Singapore has been benchmarking itself in many areas against advanced countries, I think we should do likewise in the hospital beds ratio.

If our hospitals are indeed overcrowded, then building bedrooms carved out from wards for loved ones to stay, as reported in a newspaper article, will only worsen the problem.

If there is a genuine need for such accommodation, our Government may wish to allocate nearby land for such purposes and encourage private enterprises to build and manage them to complement the hospital services.

Our Government has also done a fantastic job in marketing Singapore as a medical hub and I fully support the initiatives. But if our public hospitals are also targeting the foreign patients, will there be pressure to convert the already limited wards to better-class wards/facilities at the expense of lower-class wards?

If we have insufficient hospital beds for our current population, it will be a bigger challenge to handle the additional 1 million foreign patients without compromising on Singaporeans' increasing medical needs.

Our Health Minister mentioned that means testing is to prevent Singaporeans from abusing the system. But, is that the case?

Is the "sandwiched" middle class abusing the system if they choose to stay in lower-class wards even if their income is above average? They may have two sets of elderly parents, ailing loved ones plus school-going children to care for. I would like to think they are being prudent.

Should we force them to stay in upper-class wards and deplete their savings faster?

Compared to the lower income earners, these middle-class earners may seem "well-off", but the reality may be the opposite. Every family is unique and means testing will not be able to accurately capture the increasing financial constraints of this middle class.

Another solution to the overcrowding problem, rather than adopting means testing, is to increase the number of hospital beds — beyond the planned Jurong and Northern General hospitals.

The increased capacity will not only give all Singaporeans a choice and not deprive them of the opportunity to stay in these lower-class wards especially if they are financially constrained, but also help us service the increasing foreign patients.

Our Government will have to decide whether all Singaporeans — regardless of financial health — are entitled to basic, low cost, no-frills healthcare services.

We're not asking for free medical treatment or hospital stay like in some countries, but to have a fair system for all Singaporeans.


Comparing our bed ratio to those of the other developed Asian countries, angry doc is tempted to conclude that we do suffer from bed shortage.

But wait.

Mr Tan goes on to tell us that the countries with the lowest bed ratios include Gulf states like Kuwait, UAE, and Bahrain.

Now Kuwait, UAE and Bahrain are not exactly Third World countries, with what the oil bursting out of the ground, so why would they have bed shortages? Moreover, healthcare in Kuwait, UAE and Bahrain are actually quite good, so their low bed ratios do not seem to translate to poorer healthcare for their residents either.

So what's happening here?

Well, disease patterns and health-seeking behaviour differ from country to country. A low bed ratio does not necessarily mean that the people are sick and unable to get a bed in hospital; it might just mean that they are mostly healthy and do not need to be hospitalised. On the other hand, a high bed ratio may also not mean that everyone who needs a hospital bed will get one, if access to hospital is difficult, hospitalisation fees are high, or if the beds are 'oversubscribed'.

What we perhaps need to do in asnwering the question of whether we have a problem of bed shortage is to look at data other than bed ratios.

What is the occupancy rate of beds by ward class like?

What are the waiting times from the emergency department to the ward?

What are the waiting times for elective admissions like?

Those statistics, angry doc believes, will give a better picture of whether or not we do have a bed shortage problem here.

But even if we do have all those figures, and even if we do have a proven bed shortage, it does not answer Mr Tan's question of whether the root cause is that of a fundamental bed shortage, or whether it is that of abuse. A hospital with a high occupancy may have a high abuse rate if most of the patients in fact do not require hospitalisation, just as a hospital with low occupancy may in fact have a zero abuse rate if all the patients are there for medical reasons.

We cannot have a system that will prevent abuse unless we have a system that has the moral courage to identify abuse and to stop it. Until we do that, everything else we do is just penalising people who genuinely require healthcare.

Subsidy and Other Preoccupations 11

The ST Forum published a letter from Gerald today:


Have disease-specific time limits for means testing

I REFER to the editorial, 'Means testing a minefield' (ST, April 19). Most people would agree with the principle that the less well-off should receive more subsidies. However, follow-up questioning would likely reveal that none of them would consider themselves as 'well-off', and therefore they, too, should be deserving of subsidies.

Therein lies the difficulty of means testing - everyone agrees with the principle, but the devil is in the details of the implementation. I would like to make the following suggestions for the public and Health Ministry to consider.

Firstly, on the qualifying criteria for subsidy, no matter how the cut-off line is drawn, there will be unhappiness among those above the line. The use of a sliding scale, so that everyone enjoys at least some subsidy, is to be commended.

Furthermore, the criteria should keep pace with healthcare inflation. For example, the current maximum of $500 per capita family income for downgrading to C class was implemented in 2001. Data from Statistics Singapore shows that health-care costs have risen by almost 10 per cent since then, and only 238,000 households met this limit in 2005.

Secondly, the proposed limit of five days' stay in a public hospital is too simplistic. Certain conditions, by their very nature, necessitate a stay of more than five days, e.g., colon-cancer operation. It is also for these very conditions that we worry about chalking up large bills, rather than one-off admissions like childbirth, hernia surgery or knee replacement. With disease-specific data readily available from Casemix, the ministry should instead set disease-specific time limits.

Lastly, the public is apt to view this exercise as a cost-cutting measure. To assure us otherwise, the Government should channel the projected savings back to us, especially to those who will be affected adversely by means testing. This could be in the form of an upgrade of our MediShield packages, to assure us that although we may no longer qualify for C-class subsidies, we would still be able to afford the necessary health care when the need arises.

Gerald Tan Jit Shen


Setting disease-specific time limits sounds like a way to fine-tune means testing. Perhaps we can go one step further and implement different cut-off income levels for different diagnoses too. The background work will probably be a nightmare, but it does sound like something the ministry should look into.

Rational Rationing

"Healthcare has to be rationed. The only question is how best to do it."

So writes Dr Crippen in his latest post is on the subject of, well, rationing healthcare.

Dr Crippen believes that one of the causes for the long waiting time in the NHS is abuse of healthcare by "people who do not understand that health care is expensive", and advocates a front-end charge for healthcare.

"There needs to be a front end charge for health care. Yes, a “charge” at the point of entry. That charge needs to be a percentage of the costs of care that each patient needs. And yes, that means that some will pay more than others; that those with poor health will pay more. The system must be properly safety netted by means testing so that none will be denied health care because of cost but all must pay something."

It's a controversial idea for those used to the 'free at the point of delivery' NHS, but here in Singapore we are already familiar with the concept of co-payment.

Unfortunately, in angry doc's experience, co-payment does not always eliminate abuse; it merely imposes a fee for abusing healthcare.

People will continue to use the healthcare system inappropriately as long as they can afford it, and means testing will not be a satisfactory tool in discouraging people from abusing the system.

Let's look at a couple of hypothetical scenarios.

Mr A makes $4500 a month. He lives with his elderly mother who had a stroke, his wife, and their two children.

Mr A wants to bring his family for an overseas trip for a week, but does not want to bring his bed-bound mother along. He brings her to the emergency department and 'requests' that she be admitted. As his monthly per capita household income is $900, he passes the means test and his mother is warded into C-class.

Mr B makes $2200 a month. He is unmarried and lives with his elderly mother, who also had a stroke. His bed-bound mother gets a urinary tract infection. He brings her to the emergency department, where the doctor advises her to be admitted for treatment. As Mr B's monthly per capita household income is $1100, he fails the means test and his mother is warded into B2-class.

Is that fair?

But what if Mr A pays B2 rates for his mother's admission?

What if Mr A pays A-class or non-subsidised rate? Does that mean he is not abusing healthcare?

angry doc believes what determines abuse of healthcare is not whether one pays for it, but whether one actually needs it. Setting arbitrary income-levels to decide who gets how much subsidy is not going to change the fact that fundamentally, most of us feel that given a situation where resources are limited, they should go to those who need them most.

Subsidy and Other Preoccupations 10

An anonymous doctor made this comment on an earlier post which angry doc thinks is worth replying to in a separate post:

My wife is currently pregnant. 25 weeks gestation at the moment.

She had premature contractions.

We went to KKH.

Thoughts ran through my head about what would happen if our 25 week old baby were to be delivered.

Mortality is high. Morbidity is high. A several month stay in Neonatal ICU would cost a lot of money if we were not in C class.

These issues are real. Even for a doctor myself earning a comfortable income, a several hundred thousand dollar hospital bill followed by having to bring up a child with possible disabilities is a very sobering thought.

Luckily for us, no premature delivery occurred.

I hate to say this to you angry doc, but perhaps you need to have a loved one close to you be struck down with illness and then have the government tell you that you can't go to C class because you do not earn <$1000 a month and then later on be saddled with debt of several hundreds of thousands of dollars.

I know someone has to pay for it. But I am still happier paying higher taxes so that all of us do not have to worry so much about the cost of saving our loved ones.

To be frank at one stage I was thinking, it might be better if my soon to be born permature son die swiftly rather than for KKH's neonatologists try to save him.

Certainly isn't a good thought but it did cross my mind. :(

Certainly if angry doc's loved one needed expensive treatment, he would like to receive as much subsidy as he could.

And that's exactly the point of means testing.

Let's look at some figures.

Let's start with a total hospitalisation bill of say $300,000, which is close to the figure in the example provided by LuckSingaporean and the (in)famous KKH premature baby case.

With C-class subsidy, the final bill will be 20% or $60,000.

Assuming a 2-month stay (again using the figure from LuckySingaporean's example and assuming that a baby delievered at 25-weeks gestation is discharged at 34-weeks), at a daily withdrawal limit of $400, Medisave can be used to pay for $24,000 of the bill, leaving an out-of-pocket bill of $36,000.

At B2-class rates, the final bill is 35% or $105,000, with an out-of-pocket bill of $81,000.

Failing means testing does not mean that a patient has to pay the entire sum of $300,000.

Of course, $81,000 is still a lot of money, and if angry doc had to come up with that kind of money, it would mean working harder and scrimping. But can he, in all honestly, say that it is unaffordable?

Assuming angry doc makes $100,000 a year, do you think it is fair that he gets C-class subsidy, and lets tax money take care of the $45,000 difference?

Do you think it is fair for someone who earns more than angry doc (say $600,000 a year) to let tax money pay for the difference?

When looking an extreme example of a $300,000 bill, it is easy to think that anyone but the richest should be entitled to subsidy. However, most hospitalisation bills come up to (only) several hundred or thousand dollars. Is it fair then for angry doc to let tax money pay for the several hundred or thousand dollars in difference, when he can (presumably with his doctor's pay) easily afford it?

angry doc returns to his point that means testing, when it comes to something as variable as hospitalisation in the acute hospital, is a crude tool. At a lower end of the spectrum we may be able to accept saving more tax money by giving people who can afford it less subsidy, but at the higher end of the spectrum I think we can all agree that it can be hard even for those whom we would usually consider well-off. Means testing in its current proposed form does not consider this, and angry doc believes this is why many fear it.

Or maybe it's just that we all just don't want to pay more when we can pay less.

Added: angry doc would once again like to state that he believes subsidy should be tied to a patient's need for treatment rather than a patient's income level.

Subsidy and other Preoccupations 9

Another letter on the subject of means testing in the ST Forum today:


Means testing: Allow less well-off to pay less

WHILE I agree fully with the intention of means testing to bring about a more equitable health-care system, the operationalisation of the aim should not be to make the better-off pay more but to allow the less well-off to pay less.

The Health Ministry's decision to stick with the former indicates that health care is a zero-sum game.

All indicators point towards economic prosperity, so why the need to cut costs now instead of just boosting subsidies from the bottom?

Means testing for long stayers in hospital seems to be based on the following assumptions:

• Patients with more money are not spending as they should on health care.
• They are able to spend but they choose not to for reasons which the ministry feels are invalid.
• These patients deprive the more needy of their subsidies.
• Patients' ability to pay for health care correlates positively to their family income.

Although affordability is an important consideration when deciding on nursing homes versus hospitals or A-class versus C-class wards, I find it rather presumptuous to assume that elderly patients who can afford much better would choose a hospital over a nursing home with a better environment. For the elderly who have lived out a large portion of their lives, costs would probably be a lesser factor over environment and comfort, especially if they can well afford it.

Another debatable assumption in means testing seems to be definite familial support for the patient. Family income alone is not a good indicator of how well a patient is able to afford his hospital bill. A family that willingly supports an elderly patient would necessarily give him the best health care and comfort within its means. However, immediate family members have their own family units to take care of.

Furthermore, not all families follow the 'seniors first' rule. In the event of having to choose between paying for one's child and one's parent, many would choose to support the child.

Health care is an essentiality which no one should be deprived of, regardless of the patient's supposed ability to afford higher fees. Policies should not be made based on assumptions of familial support or dubious claims that high-income patients choose to stay in a poor man's ward.

Fang Shihan (Ms)


Ms Fang makes some valid points, but angry doc thinks some of her assumptions are wrong.

"Although affordability is an important consideration when deciding on nursing homes versus hospitals or A-class versus C-class wards, I find it rather presumptuous to assume that elderly patients who can afford much better would choose a hospital over a nursing home with a better environment."

It makes sense to think that a patient who does not need to stay in a hospital would choose to go to a nursing home instead, but in practice patients resist this as it actually costs less to stay in a C-class ward in a hospital than in a nursing home if one fails the means test. This is in fact one of the reasons given for extending the means test to hospitals (see item 13.).

"For the elderly who have lived out a large portion of their lives, costs would probably be a lesser factor over environment and comfort, especially if they can well afford it."

Again, it makes sense, but in angry doc's own experience this is not always true. In fact, many of the elderly patients he has met are obsessively thrifty when it comes to healthcare expenditure. Patients have asked for 'standby' medication to be added to their subsidised prescription for their overseas trip to China or Korea (thus helping them save a few dollars for a trip that costs them a few thousand dollars).

"Health care is an essentiality which no one should be deprived of, regardless of the patient's supposed ability to afford higher fees."

angry doc would once again like to state that he is not a fan of means testing in its current proposed form, but he nevertheless thinks that we should as far as possible be precise and accurate when we discuss this issue. Means testing in its current proposed form does not "deprive" anyone of healthcare. It does not even "deprive" anyone of subsidy, but just reduces the amount of subsidy they receive. If we misrepresent means testing in an effort to discredit it, we stand to lose credibility ourselves.

"Policies should not be made based on assumptions of familial support or dubious claims that high-income patients choose to stay in a poor man's ward."

Here angry doc agrees with Ms Fang. angry doc would like to know how much we stand to 'save' if means testing was implemented. Perhaps there should be a data-gathering phase where patients who stay for more than 5 days in the C-class ward are subjected to the proposed means test questionnaire. Perhaps it is already being planned or implemented.

Confidence Goods 10

Well, well.

CCS and CASE both replied to Ms Chen's letter today, but they have not answered her most important question.


Watchdog: Give patients fee data to make choices

I REFER to Ms Christine Chen Siew Mei's letter, 'How to decide if doc is overcharging?' (ST, April 16).

The Competition Commission of Singapore (CCS) will not issue guidelines on 'acceptable and normal charges', as this would constitute another form of fee guideline.

It should be noted that the Ministry of Health's guidelines under the Private Hospitals and Medical Clinics Act and Regulations require doctors to display their fees and other relevant charges prominently. Hence patients would know beforehand the fees payable.

CCS would also encourage bodies such as the Singapore Medical Association to collect and make widely available information on the fees charged by doctors, so that the public is aware of the range of fees charged for various medical procedures and treatments.

This would enable the public to know where a particular doctor's fee stands in relation to the fees charged in the market and make informed decisions about which doctor to see.

The CCS will work with the Consumers Association of Singapore to review the complaints that it may receive on doctors' fees. CCS will take action if there is any infringement of the Competition Act.

More information on the Competition Act can be found on our website at (link removed).

Chin Yen Yen (Ms)
Senior Assistant Director (Corporate Communications)
for Chief Executive Competition Commission of Singapore


Free competition will keep prices in check

I REFER to Ms Christine Chen Siew Mei's letter, 'How to decide if doc is overcharging?' (ST, April 16).

The Consumers Association of Singapore (Case) does not always require fees to be paid whenever consumers approach us. Consumers can seek advice via phone, e-mail or walk-in consultation at no charge.

Our officers will advise consumers on a case-by-case basis and highlight the various options of recourse.

Only when consumers request for us to represent them and manage their complaints would they need to join us as members.

As to the writer's concerns about overcharging, we believe that free competition will work against doctors who charge excessively. With free competition, there will always be a range of fees that doctors charge and consumers can choose the doctor that fits their budget.

Doctors who intend to charge a certain level of fee will need good reasons to do so. Doctors who price themselves out of the market may lose their patients to those who charge market rates.

We encourage clinics to practise transparency by displaying prominently the costs of consultation and other medical services at the entrance and at the registration counter. This will ensure that walk-in patients are fully aware of the charges before they seek a consultation and prevent disputes over fees.

Cost-conscious patients should call up a few clinics to enquire about the consultation fees.
We also expect doctors to itemise their charges, so that consumers are able to determine the cost of consultation vis-à-vis the costs of related products and services.

While we believe that fees will not differ significantly after the withdrawal of SMA guidelines, we will continue to monitor the situation and may conduct a survey of medical practitioners' fees in future.

Should members of the public have queries on any consumer issue, they can call 6463-1811 or e-mail (link removed)

Seah Seng Choon
Executive Director
Consumers Association of Singapore


CCS and CASE have both avoided answering the question: Do they have the expertise or domain knowledge to know the intricacies and complexities of pricing in the whole spectrum of health care?

Say you go to a specialist for a surgery, and the fees he quotes you is the top of the range of fees, and several times that of the private rate at restructured hospitals. Is he overcharging you? What if all his other patients who had previously undergone that surgery have paid up without complaints, and felt they had good value for their money?

Say you go to a GP for a problem, and he orders several blood tests, X-rays and scans, and does a biopsy for you, all of which are charged at the middle or lower part of the range. Is he overcharging you? What if many doctors would actually consider the tests he has done for you as redundant?

Without taking quality into account, a "survey of medical practitioners' fees" and "itemised charges" will not allow patients to make informed decisions about their healthcare spending.

Not only have CCS and CASE not answered Ms Chen's questions satisfactorily, their replies in fact raise another question: If CCS believes that free competition will benefit patients, why does it need CASE to monitor the fees?

Or, as Lt Kaffee would ask:

"If you gave an order that Santiago wasn't to be touched, and your orders are always followed, then why would Santiago be in danger?"

Subsidy and other Preoccupations 8

Sometimes angry doc has difficulty deciding whether letter-writers to the ST Forum are cleverly subtle, or just clueless.


Worry and questions about means testing

I REFER to the article, 'Means testing in hospitals within a year' (ST, April 8).

The problem that means testing is trying to resolve is the 'abuse of subsidised health care'. I disagree with this approach.

By applying for C-class wards, a patient is sacrificing level of service, comfort and reduced waiting time. Hence middle-class citizens who can afford better wards must be applying for C-class wards for pure cost savings.

This should be a personal choice. Why can't middle-class citizens elect to get subsidised health care?

Imagine securing a C-class ward, and, after enduring the long queues and a more crowded environment, having to pay B-class prices after five days.

Furthermore, the definition of what a person can afford may vary. Do we use taxable income? Or disposable income? What about the number of dependants? There are many complexities in this financial decision, and devoting the Health Ministry's resources to perform credit assessments on everyone may generate a substantial cost in itself.

If the patient load in C-class wards is getting heavier, wouldn't it be more efficient if more B-class wards are converted to C-class wards?

With the reduced number of B-class wards, their prices can be subject to market forces. Citizens can hence freely elect to pay B- or A-class prices to enjoy better service. I believe this would be a better way of reducing patient load.

The same argument against middle-class citizens enjoying health-care subsidies can be applied to education subsidies. Do we really want to move in that direction?

Soo Kuo-Ooi


What do you think?

How much is that doctor in the window? 8

A very pertinent question was raised in the ST Forum today:


How to decide if doc is overcharging?

THE Competition Commission of Singapore's (CCS) response to the recent withdrawal of the Singapore Medical Association's (SMA) guidelines on fees deserves more discussion.

CCS announced that it will work closely with the Consumers Association of Singapore (Case) to handle any complaints of overcharging by doctors.

This is good but it opens up two questions.

The first is will there be a charge levied?

The SMA never levied any charge on members of the public who filed complaints against doctors. But a visit to the Case website reveals that a complainant usually has to join Case as a member. Membership carries an annual subscription of $25 and filing a complaint incurs an administrative charge of $10.

The second question is more fundamental. How will CCS and Case decide on what constitutes overcharging?

The term 'overcharging' carries with it the notion of relativity. Overcharging can exist only if there is an understanding of what is 'normal charging'.

But without benchmarks and guidelines, it is practically impossible to define overcharging. Are CCS and Case going to draw up their own guidelines on what are acceptable and normal prices?

How will CCS and Case decide a doctor is not merely 'expensive' but has transgressed to the point of 'overcharging'?

Do they have the expertise or domain knowledge to know the intricacies and complexities of pricing in the whole spectrum of health care?

And will CCS and Case likewise step up to the plate to handle overcharging complaints when other professional groups withdraw their equivalents of price or fee guidelines?

These are questions that need to be answered clearly and soon.

Christine Chen Siew Mei (Ms)


How indeed.

As angry doc has mentioned in a comment in a previous post, overcharging is not against medical ethics per se. Neither the Hippocratic Oath nor the SMC Ethical Code forbids overcharging.

As long as the fee is agreed upon, and it is not an emergency situation, there really isn't a definition for overcharging. Doctors charge, and are paid, what 'the market will bear'.

One can perhaps stipulate a 'normal price' for a particular treatment or procedure by a particular grade of doctor, but it will not reflect the reality of the private healthcare sector, where sought-after specialists command a premium and still have a steady flow of patients.

On the other hand, having a fixed or 'normal' price for particular treatment or procedures may result in over-servicing, where a doctor recommends and performs treatment, investigations and procedures which are not strictly necessary or beneficial to the patient. But then again, this is already the reality in healthcare systems where physicians are reimbursed for services and procedures rather than result or outcomes.

Of course, one may also over-service and overcharge patients.

Like Ms Chen, angry doc is not yet convinced that CCS or CASE have the required knowledge or experience to tell when a patient has been overcharged or over-serviced.

angry doc is not even sure doctors can be sure all the time, but if he had to be hauled up for allegations of overcharging a patient, he would rather be facing people who knew what treating a patient entailed.

How much is that doctor in the window? 7

One of the reasons why angry doc reads Dr Crippen's blog is because he believes that changes in the NHS are often followed by similar changes in the local healthcare system.

From Dr Crippen's entry today, angry doc learnt that "[British] MPs awarded themselves a 66% pay rise".

angry doc couldn't find any recent news article on that story, but he did manage to find this old news article from when the proposal for a pay rise was first announced.

What does this have to do with the title of this post?

Well, even with the 66% pay rise, GPs in the UK still have a higher base salary than their MPs.

Subsidy and other Preoccupations 7

One of the shortcomings of means testing which Mr Chang did not bring up in his letter featured yesterday is the fact that means testing, when it comes to subsidy for hospitalisation, is a crude tool.

Patients are admitted to the acute-care hospital for a variety of reasons, and the costs can therefore vary very much depending on the condition and treatment. Under the proposed means testing scheme a patient who passes the means test will enjoy an 80% subsidy, while a patient who fails the means test will receive something perhaps closer to the B2 class subsidy level of 65%.

At the lower end of the scale, say a 5-day admission for chronic obstructive lung disease at Alexandra Hospital, this 15% difference translates to something in the region of $300.

At the higher end of the scale, say a 12-day admission for a coronary bypass at National University Hospital, the difference is in the region of $2000.

So while the percentage differences are the same in both cases, angry doc believes that it is the absolute amount that patients are worried about.

Further, angry doc believes that the absolute amount needs to be seen as a percentage not just of the total hospital bill, or against the per capita household income, but as a percentage against the total hosehold income and what it means in terms of the reduction to the per capita household income.

Let me illustrate this with a couple of examples, using a threshold of $1000 per capita per month (see here for why I chose this value) and two patients whose incomes are $100 above and below this threshold respectively.

Mr A, who has a wife one child, earns $3300 a month. His per capita houshold income is $1100 and he fails the means test.

Mr B, who lives with his parents, wife, and two kids, earns $5400 a month. His per capita household income is $900 and he passes the means test.

Mr A and Mr B are both admitted for coronary bypass. Mr A's bill comes up to $4844, while Mr B's bill is $2768.

Mr A's bill translates to 12% of his total annual income, and Mr B's bill translates to 4.3% of his total annual income.

In other words, Mr A, whose absolute total annual income is lower than that of Mr B, pays a higher fee than Mr B, both in terms of absolute amount, as well as in percentage terms.

angry doc can easily see why Mr A will think means testing is an unfair system.

Subsidy and other Preoccupations 6

As expected, a letter on the ST Forum on means testing.

Mr Chang sounds angry, and his letter looks a little disorganised (and angry doc had to rearrange a couple of paragraphs to make his commentary below). He uses many arguments that people use when faced with the prospect of paying more for healthcare. Let's have a look at them together, shall we?


"I STRONGLY disagree with the plan to introduce means testing in public hospitals ('Means testing in hospitals within a year'; The Sunday Times, April 8).

Why are Singaporeans paying more in income tax, based on earnings, and getting less or no subsidies in hospitals? Isn't this a double whammy? Middle-income earners are likely to be the hardest hit again.

What is the justification for taking away subsidies because of a heavier patient load in hospitals? The heavier load should be managed through beefing up health-care staff and more funding from the Government. This is especially so in the face of an ageing population."


At first glance Mr Chang's argument makes sense: why should one tax-payer receive less subsidy compared to another tax-payer who has a lower income, since he, by virtue of the fact that he has higher income, pays more taxes? Let the government government rather than tax-payers pay for the required funding and staffing, he argues.

Now assuming that the other government expenditure remain static, any increase in government funding in healthcare will necessarily come from taxation. And if we assume that this taxation will come from income tax with the same exemption for people who do not make the minimal taxable income, such a system will benefit the lower-income group, and 'penalise' the middle income group who do pay income tax, and also all tax-payers who do not utilise the subsidised healthcare system.

So at the end of the day, unfortunately, a middle-income earner will still have to pay for his healthcare, either out of his pocket or through his taxes.

(If you are interested, angry doc has previously tried to estimate how much increase in taxation a fully funded healthcare system will mean.)


"Hospitals already have a first-line check. The minimum entry level is B2 class. Downgrading to C class involves much red tape, which prevents people from abusing the system."


angry doc is not sure that the minimum entry level is B2 class, but downgrading to C class is difficult, although there are ways to beat the system...


"Having a child with a critical long-term medical condition means having to visit the hospital on average once a week, be it inpatient or outpatient.
...

The Government has been encouraging young parents to have more children but its actions are not in sync with this drive."


One can in fact utilise the same argument to argue against an increase in the cost of almost everything: petrol prices because children need to go to school, food prices because children need to eat, property prices because they need a place to sleep, and so on. O! won't somebody please think of the children?

To be fair the government does provide many things in the form of free healthcare for children, such as free immunisation and free screening by the School Health Service Division, and until recently free weight reduction programme in the form of the TAF Programme.


"As a Singaporean and a taxpayer, I would expect to be taken care of and not have to compromise on health care because of uncertain financial support.

...

Medical subsidy should not be given on a case-by-case basis. It should be an entitlement of the Singaporean taxpayer, who should not have to 'beg' for it during trying times.

Chang Kiang Meng"


These two paragraphs give the two key obstacles to the implementation of means testing: that it offends our sense of entitlement, and that it can be demeaning.

angry doc believes that most Singaporeans do view healthcare subsidy as an entitlement - something they earned just by being a citizen and a tax-payer - and so it seems like a perversion of justice when those who pay more taxes should be denied benefits from the very system they have contributed towards.

angry doc is no fan of means testing, but he nevertheless thinks he might need to re-examine this sense of entitlement. Means testing in its current form does not deny one subsidy altogether - it merely reduces the amount of subsidy one receives - nor does it deny one affordable healthcare. If we all make the connection that the subsidy being given comes from the taxes we pay ourselves, perhaps the idea of means testing will become more acceptable?

The final sentence in Mr Chang's letter tells us the other reason for resistance to the implementation of means testing: people do not like to beg.

Being subjected to means testing can be a demeaning experience. One is required to provide proof of one's poverty, as it were.

angry doc has seen some patients who would rather give up on their applying for financial assistance than to turn up for the interview and provide the required income data. Perhaps they didn't really need the financial assistance or would not have made the cut. Perhaps their per capita household income was too high, but their family did not give them enough money to see the doctor. Perhaps their pride did not allow them to go through the whole process.

Whatever the case, angry doc imagines that the means test is one test that a patient wouldn't feel good about whether he passes or fails it.

How much is that doctor in the window? 6

How much money should a doctor make?

Events over the past two weeks have prompted angry doc to mull over this question which he should have asked himself (and given himself a satisfactory answer to) years ago, but never did.

Money was a major consideration when angry doc was a mere stripling (yet to earn his spear or first penny) having to make the choice in school subjects which would eventually decide his future career (well, it seemed that way then...). You see, angry doc decided to work towards getting into medical school because he thought the healthcare is about helping people and not about money at all. Like Dr Crippen, he too had the idea that the financial renumeration from practising medicine would keep him 'reasonably comfortable', so he did not bother finding out how much money he stood to make if he decided to go to business or law school instead. Doctors, he thought, got a good pay doing a good thing.

Of course, we all now know how wrong he was: healthcare isn't always about helping people, but it is always about money, and some doctors struggle to make ends meet and maintain a work-life balance. But I digress...

angry doc is of course not the first doctor (or person) to mull over the question of how much doctors should be paid. A quick search on google turns up this article by Dr Bottle, which in turn refers to two other articles (one by Dr Atul Gawande and the other by Dr Gunderman). Together the articles address the ethical and practical issues of 'physician compensation'. They do not tell angry doc how to come up with an exact figure of how much doctors should be paid, but then that's not what the authors set out to do.

There will probably never be a 'right' answer to angry doc's question; as Dr Gunderman wrote in his article: "[w]here you stand on physicians' incomes depends in part from where you sit". Patients and third-party payers will always want to pay as little as they can, and doctors will always want to be paid an amount which they feel gives them fair renumeration for their efforts and the risks they bear.

How one chooses to think about the question is perhaps already decided by what answer one wants to arrive at.

Subsidy and other Preoccupations 5

Seeing as how means testing is likely to become a hot topic over the next couple of weeks, angry doc would like to draw his readers' attention to this excellent repository of news articles and letters on means testing in Singapore.

Confidence Goods 9

Thanks to aliendoc, angry doc can take a break from blogging about the letters that hit the forum today.

Now he'll just sit back and wait till the letters on means testing come along...

Mental Capacity Act 3

angry doc was hoping to take it easy over the Easter weekend, but the hits just keep coming...

From Dr Crippen, he learns of this story concerning the Mental Capacity Act in the UK:


(excerpt)

The Act will give legally binding force for the first time to advance directives - or 'living wills' - under which patients can set down their wish to refuse treatment if they become seriously or terminally ill. In a living will, a patient can tell doctors to withdraw treatment so that they die as a result. During the passage of the Bill through Parliament the Government insisted that the practice did not amount to euthanasia. But some doctors insist that if they deliberately withheld food and fluid from a person who would not otherwise die they would be complicit in 'euthanasia by omission' or assisting in a suicide. Doctors must get a second opinion before deciding to withdraw artificial nutrition and hydration from a patient who is not close to death. There are also new provisions for patients to give 'lasting powers of attorney' to a friend or relative. This 'attorney' would be able to instruct doctors to let the patient die if they became incapacitated. Those refusing to obey the instructions would be open to prosecution for assault. Doctors or nurses could also be accused of 'wilfully neglecting' incapacitated patients and punished with up to five years in jail.


Will doctors in Singapore face a similar situation?

angry doc doubts it.

Given that the proposed Mental Capacity Bill is meant partly to address a lack in the Mental Disorders and Treatment Act (MDTA) by allowing patients to appoint someone with the power of attorney in the event that he loses his mental capcity, it is likely that the following clause from the MDTA will also apply:


Provision in case of cruel treatment or neglect of persons of unsound mind.33.

(1) If it appears to a Magistrate on the report of a police officer or on the information of any person that any person supposed to be of unsound mind is not under proper care and control or is cruelly treated or neglected by any relative or other person having the charge of him, the Magistrate may send for the person supposed to be of unsound mind and summon the relative or other person as has or ought to have the charge of him, and the Magistrate may after due inquiry make an order for the person to be sent to a medical officer at a mental hospital for treatment and the medical officer may thereafter act in accordance with section 35.


In addition, the MCYS press release on the MCA also states that the proposed Bill will:

"be guided by the principle that decisions made on behalf of the person must be done for his best interests,"

and that:

"Donees will be given statutory protection for their actions as long as they act within the ambit of the legislation. At the same time, safeguards will be introduced to ensure that the decision makers do not abuse their powers."

Still, if you feel worried enough by the proposed MCA, you might just want to send your feedback to the MCYS.

Subsidy and other Preoccupations 4

After years of anticipation and uncertainty, we finally have a projected date for the implementation of means testing.


(excerpt)

Means testing may kick in within next 12 months: Health Minister
By Hasnita A Majid, Channel NewsAsia

Means testing may kick in within the next 12 months, says Health Minister Khaw Boon Wan.

And the first to be affected will be patients in C-class wards who stay more than five days in hospital.

Patients in C-class wards now enjoy an 80 percent subsidy.

But the Health Ministry realised that not all patients need such a subsidy, as there are some in the high income bracket who choose to be hospitalised in such wards.

To ensure that there is no abuse of the system, the Health Minister says means testing must be done on those who stay more than five days in hospital - the average length of stay.

Means testing, which is a way to determine how much subsidy a patient should get, is already done in nursing homes and community hospitals.

Mr Khaw says: "We are in this business where all of us want to constantly improve our service level. But if your prices are wrong, if they are heavily subsidised or free or whatever, you are going to attract more and more patients to you, including those who can go to Gleneagles Hospital and Mount Elizabeth and so on. And we have very good doctors, very good specialists. So we know that at the end of the day, means testing are important.

"And until you introduce proper means testing, I'm afraid all these problems will remain, will simmer. I'm seriously thinking about all those who are long stay, who should now be discharged to community hospital, we should do means testing on them. Now they are saying that if they go to nursing homes they will be means tested but if they remain at SGH they are not means tested, therefore it's cheaper - then we will never solve this problem."

Mr Khaw says for those who can afford to pay more, their subsidy may be reduced to less than 80 percent but they will not be asked to move to a higher class ward.

However, he is not keen to extend means testing at the polyclinic level for practical reasons.

Mr Khaw says: "It's not just looking at your personal income - we are talking about family income here. The whole family should be supporting the patient. So therefore I need to know how many children you have and how much are they earning. And we cannot have self-declaration because everybody will say they are poor, they earn $800 when actually it may not be so. So you begin to see the complexity of means testing.

"We know that at our polyclinics, waiting time is already very long. If at the counter we are going to start asking all these questions, you know, I think we cannot do business. We will end up doing only means testing and no treatment. So it's not practical unfortunately."

Mr Khaw was speaking at a dialogue session on on Saturday with unionists in the healthcare sector, where he answered several questions.

(click here to read rest of article)


Announcing the decision at this time is really bad timing.

Timing aside, angry doc wonders what life in a C-class ward where not everyone pays the same fees will be like. Will those who receive say 70% subsidy feel that they are entitled to better care and service compared to those who receive 80% subsidy, since they pay more? How will the staff and 80%-subsidised patients feel towards them? Will they simply decide that they should just upgrade to B2 class and receive 65% subsidy instead?

angry doc is still ambivalent about the whole concept of means testing; he believes that the right way to control government healthcare spending should be rationing based on need (for the treatment) rather than ability to pay.

For angry doc to embrace the concept of means testing, it will require him to make a paradigm shift and see subsidy not as a form of entitlement which all citizens should enjoy equally if they wished, but as a form of, well, subsidy for those who need them.

Confidence Goods 8

angry doc doesn't usually feature articles from The New Paper, but he would like to use this one as material for our exercise this weekend:


SCRAPPING OF MEDICAL FEE GUIDELINES
Health expert says: It won't work for specialist clinics
By Ng Wan Ching
April 05, 2007

APPLYING economic laws to healthcare products and services is tricky.

And consumer ignorance is one reason why market forces may not 'work to the full extent' when it comes to the cost of specialist care.

Health economist Phua Kai Hong, of the National University of Singapore, said this in response to the Singapore Medical Association's (SMA) statement that it will no longer issue guidelines on fees.

The association said the guidelines on fees may go against the Competition Act, which came into effect last January.

Recommending charges could be considered price-fixing and breaking the law.

On this issue, Associate Professor Phua, who was involved with the SMA in the past to revise the guidelines, said: 'The worry is not so much for primary healthcare. The GPs are already very competitive.

'With specialists, there is usually more consumer ignorance. This is where market forces cannot work to the full extent,' he said.

By the time patients need to see specialists, it may be an emergency or they are quite ill and may be psychologically affected. By then, few will seek a second or third opinion.

'(An unethical doctor) may decide to do a wallet biopsy to see how much the patient can afford. How many patients will know enough to make rational and cost-effective choices?' Assoc Prof Phua asked.

(Wallet biopsy is medical lingo to describe a check on a patient's financial ability to pay for medical services.)

Which is why he does not understand why the Competition Act should have any impact on the guidelines.

He said the guidelines were developed by comparing local fees here against the fee schedules of other developed countries as a fair and rational means of paying doctors.

'Healthcare is a special economic product. It has humanitarian and moral characteristics. It's very personal,' he said.

Assoc Prof Phua, who also chaired a past Health Ministry-related committee on Transparency in Hospital Billing in 2004, said there will be issues too if the doctor is not cost-conscious.

'He is in a position to order all sorts of tests and if the consumer is ignorant, it is very hard to challenge which tests are necessary and which are not,' he said.

FAIR

He explained that the guidelines were there for reference on what was fair - a range of fees from the low end to the high end - but it was not something that had to be followed.

'In the US and almost all developed countries, that's how they do it. Every procedure has a fee guideline. Without it, there is no check and balance,' he said.

The problem, he added, is also compounded by the lack of comprehensive information on average bill sizes for private hospitals - they have given their bill sizes voluntarily and the list is not complete. Bill sizes also do not reflect doctors' fees, he pointed out.

A Health Ministry spokesman said that it is still working on getting more bill-size information from private hospitals for its website.

Associate Professor Goh Lee Gan, a past president of the SMA, said that individual doctors should now display their own GOF (guideline of fees).

'The patient can still ask the doctor what his fees will be, roughly. It's likely that life will go on as usual,' he said.

If a doctor overcharges, even if he is a specialist, word will get around and patients will leave.

He added: 'It is important to teach patients to find out what they are paying for and whether they get what they are paying for.'

For this, the press definitely has a role to play, Assoc Prof Goh said.

MOH said its guidelines under the Private Hospitals and Medical Clinics Act and Regulations still stand.

Before consultation, doctors are encouraged to inform patients on the likely charges. Every private hospital manager is required by law to ensure that every patient is informed, on or before his admission, of the estimated total charges for his hospitalisation and treatment.

This is to allow patient and family to make informed choices.

The Competition Commission of Singapore (CCS), which is the competition watchdog here, has welcomed the move by the SMA to remove its guidelines.

A CCS spokesman said this would permit greater flexibility for fees to be set by doctors in line with their business costs.

Such a move is more in line with today's circumstances.

Consumers would therefore benefit from the greater transparency and competition of prices.


Now count how many times the word 'quality' appears in the article.

Ven-duh 3

Through Dr RW, angry doc learns of this CNN news article (excerpt):


Pity the poor pharmaceutical sales rep
Amid mounting competition and a backlash against Big Pharma's aggressive sales tactics, drug reps are looking more and more like an endangered species.
By Aaron Smith, CNNMoney.com staff writer
April 4 2007: 8:17 AM EDT

NEW YORK (CNNMoney.com) -- It's hard out there for drug sales reps--particularly if they work in places where gaining access to doctors is becoming increasingly difficult.

Take Boston. Glenn Abrahamsen, senior director of global analytics for drug company Schering-Plough, says the city is full of medical groups with formal policies restricting the access that company reps have to individual doctors.

"We weren't allowed to leave samples: not tissue boxes or anything," said Abrahamsen, speaking at iiBig conference in Atlantic City, N.J. late last month "We weren't allowed past the receptionist."

Such "closed door" policies are now common around the country, especially in Washington, Minnesota and Wisconsin, according to anecdotal evidence from drug sales reps and medical groups.

The backlash--fueled in part by double-digit increases in advertising spending by Big Pharma--is turning the industry on its head. Sales reps are facing massive layoffs and falling incomes as commissions drop. Drug companies, meanwhile, are scrambling to come up with new ways to get their medications in front of the doctors who would prescribe them.

In one sign of the dislocation, Pfizer is in the process of laying off 2,200 sales reps, or about one-fifth of its U.S. sales force. Industry watchers expect rival companies will soon follow with cutbacks of their own.


The question now is whether the lowered manpower expenditure will actually translate to lower drug costs or more investments into drug research, or whether pharmaceutical companies will simply think of other ways to use that money to influence doctors' prescribing patterns.

Confidence Goods 7

Three letters on the ST Forum today on the SMA's decision to withdrawal its guidelines of fees.

Dr Lim Boon Hee predicts that "[n]ow that the Singapore Medical Association has withdrawn guidelines on medical fees for fear of contravening the Competition Act, the situation is set to worsen," and advises patients: "Do not assume anything to be free and you won't go far wrong in this free market where the difference to your pocket can be a matter of thousands of dollars."

Mr Lim suggests that clinics "should clearly display their general charges at the door or outside the clinic so that patients will know the cost before entering the clinic and not when they are in the clinic seeing the doctor," presumably sparing both sides from unnecessary embarrassment.

The most interesting letter amongst the three, in angry doc's opinion, was however relegated to the online forum:


Competition Act should exclude medical services

I READ with dismay that the SMA is withdrawing fee guidelines for doctors as the guide could be in contravention of the recently enacted competition code, 'Private docs can set own fees as SMA drops guidelines' (ST, April 3).

Competition is not an ends in itself. The intent of the Competition Act is to let consumers benefit from more choices, lower prices and better products and services when businesses compete. Therefore, in assessing possible restraints on competition, the Competition Commission should examine the market from the point of view of the consumer.

Would doing away with SMA guidelines promote or hinder consumers' interest? I think the latter.

Health care is not like normal goods and services, the sick cannot shop around. And for health-care providers, the quality of care does not (and should not) be affected by economic incentives.

Section 34 of the Act prohibits agreements which prevent, restrict or distort competition. I cannot see how there is an appreciable anti-competitive effect by having guidelines on doctors' fees.

It should also be noted that the fee guide was implemented to inject transparency into private medical charges. By scrapping the fee guide, is the SMA regressing on the need for transparency and, in doing so, give private doctors the liberty to overcharge?

Currently, certain activities and sectors are excluded from the Act. These include postal services, portable water, bus services, rail services, activities of 'net economic benefit' and those 'arising from exceptional or compelling reasons of public policy'. The exclusion of some of these sectors is based on public interest considerations.

It is arguably in the public interest to exempt health care from the Competition Act. At the very least, the commission should give industry-specific regulators like the SMA with their industry knowledge and expertise, the mandate to handle issues such as the guidelines on doctors' fees.

Faye Chiam Pui Hoon (Miss)


Unlike Ms Chiam, angry doc does consider SMA's guidelines an attempt at price-fixing and reducing competition between doctors.

But like Ms Chiam, angry doc believes competition should not be an end in itself.

As with almost everything it is important to look at how general concepts apply to a specific context. The form of competition the guidelines were aimed at discouraging was one based completely on price alone, with no regard to the quality of care being delivered, and which threatened patient-care.

Of course, the guidelines are not the only way to achieve this (nor, come to think of it, a very successful method so far); the Ministry's planned data on the range of fees charged by doctors will likely serve the same purpose.

What angry doc finds sad in this ongoing media drama is that almost all the focus has been on the virtues of competition and how it will reduce costs, with no understanding of the fact that sometimes, cheaper simply means worse.

Confidence Goods 6

Somebody hold angry doc back, because this really makes him angry (emphasis mine).


Competition Commission partners CASE to monitor pricing

SINGAPORE: Price-fixing by companies or industry associations may soon be a thing of the past.

CASE, the consumer watchdog, will get extra help from the Competition Commission of Singapore (CCS) to take action against businesses which charge uncompetitive prices.

CCS is a regulator of price-fixing and it announced on Thursday that it will support CASE to monitor and possibly take violating companies to task.

After the Singapore Medical Association (SMA) withdrew guidelines on 1 April, doctors can now charge patients freely, according to their business costs.

In a letter to its members, SMA said it had been advised by its legal advisors that its fee guidelines contravened the Competition Act.

At an off-camera briefing, the CCS said although it has not accused SMA of price-fixing, the association’s fee guidelines, which had been in place for the past 20 years, can stifle market forces and harm consumers by reducing choice.

And these guidelines send a signal to market players, in this case – the doctors, to price their services in a narrow range, even if it does not eventually lead to price-fixing.

The commission expects visits to the doctor to be potentially cheaper in the long run.

All that is left to do is to wait for the market to adjust to the new changes.

But should there be cases of overcharging, the CCS will work with CASE to monitor and correct any exorbitant rise in doctors' fees.

CASE Executive Director Seah Seng Choon said he looks forward to working with the commission to facilitate solutions to consumers' complaints on uncompetitive pricing and practices.

Following SMA's recent withdrawal, Healthway Medical Group, which has a network of 40 clinics, has said it has no plans to raise its fees and will maintain it within the withdrawn guidelines.


Sure it may be cheaper to see a doctor after the guidelines are withdrawn, but this is not about the guidelines anymore. Rather, it is about the insinuation that the idea behind the guidelines was cartelism, and that the CCS was the good guy here protecting all patients from us greedy doctors who have been conspiring to overcharge them all along.

Cheaper does not always mean better, and unlike with a cup of coffee or a plate of chicken-rice the consumer here cannot always tell the quality of the goods he has received. Choice means little when consumers cannot discern quality, and market forces do not always work to the benefit of consumers.

The guidelines may have been an attempt by SMA at price-fixing, but as angry doc understood it they were never conceived as a means to maintain consultation fees at an artificially high rate and to benefit the doctors at the expense of patients, but rather as a common reference point to reduce the prevalence of undercutting amongst GPs, which was threatening to compromise the quality of care being given.

To blindly pursue free market, consumer choice, and lower prices without understanding that medicine is a confidence goods is to do all parties concerned a disservice.

Or, as Colonel Jessep would put it:

"You put people's lives in danger. Sweet dreams, son."

How much is that doctor in the window? 5

Another article and a letter on the withdrawal of the SMA guidelines of fees in Today today.


How much to see the doc?
Survey results on GP fees to be released within a year but patients face info void now
Tan Hui Leng

WHILE it has withdrawn its fee guideline for doctors' services, the Singapore Medical Association (SMA) will soon release information that should give patients an idea of average charges at General Practitioner (GP) clinics.

The results of the association's survey on primary care clinics, conducted last year, are being analysed and details will be published on the SMA website within a year. The association will also conduct a similar survey among medical specialists this year.

The announcement, made by the SMA at a press conference yesterday to explain the sudden and controversial withdrawal of its Guideline on Fees on Sunday, follows the move by the Ministry of Health (MOH) to publish GP fee schedules online by year's end.

With the withdrawal, the SMA will no longer handle the public's complaints — it receives more than 20 a year — about being overcharged by doctors.

But it is open to exploring a new feedback channel for consumers, in collaboration with the MOH and the Consumers' Association of Singapore — if doing so does not compromise the association's legal position, said SMA president, Dr Wong Chiang Yin.

The SMA move came after extensive discussion with lawyers and the authorities over how the guideline could be viewed as a form of price-fixing, in contravention of the year-old Competition Act.

On talk that doctors had agreed to strike the fee guide so as to mark up their salaries, Dr Wong said: "That is sad because we are doing this with deep regret, great reluctance ... this is 20 years of work by my predecessors, and we are just putting it away? But we don't really have a choice."
First published in 1987 to make private medical charges transparent, the fee guideline has kept price hikes for common procedures, such as basic chest X-rays, to between 10 and 60 per cent — quite a "modest" figure, noted Dr Wong.

But four of the association's five law consultants had believed it to be in breach of competition law. Confirming this with the Competition Commission of Singapore would have cost the non-profit SMA, which had a turnover of $1 million and an operating surplus of $15,000 last year, more than it could afford. Earlier, Dr Wong had told Today the bill could have added up to $200,000, including legal fees.

Clarifying its fees yesterday, the Commission said parties requesting its guidance need only pay an initial fee of $3,000, without incurring legal fees, plus an additional $20,000 for more complex cases. Fees for an actual verdict range from $5,000 to $45,000.

Doctors have been told to remove the SMA fee guideline card from their clinics but are required to display their own pricing information under the Private Hospital and Medical Clinics Act.

The association has also advised its members to set "reasonable" consultation fees. The concern now, said SMA spokesman Dr Tan Sze Wee, is the lack of information for patients. "If you have an urgent need to see a doctor ... you wouldn't have time to call up five GPs to ask for the best quote," Dr Tan said.


If the system is not sick ...
Why withdraw doctors' fee guidelines when healthcare sector is clearly competitive?
Letter from Chua Soo Kiat

I am deeply perplexed by the Singapore Medical Association's (SMA) move to withdraw the guideline of fees for private doctors and their apparent lack of consultation with our Health Ministry, for it seems our Health Minister was equally surprised.

The fee guidelines seemed to have served Singapore pretty well. There have been no statistical data, survey results or any reports to suggest that our current private medical cost structure is uncompetitive, either too high for the average Singaporean or too low for our doctors and specialists to make a decent profit.

The only compelling reason given by the SMA president, Mr Wong Chiang Yin, was that they had "no choice" because SMA may not comply with the Competition Act.

Buying into this logic is very difficult. The SMA seemed to have taken an approach too narrow and inflexible when complying with the Competition Act.

First, as with any other law, compliance with the Competition Act should not take into account just the legal words, but more importantly, the spirit and the intent of the law. A holistic view is needed and public interests have to be carefully weighed given the wide-ranging ramifications.

The first duty spelt out in the Competition Act's Section (6)(1)(a) is to "maintain and enhance efficient market conduct and promote overall productivity, innovation and competitiveness of markets in Singapore".

Singapore has one of the world's most acclaimed healthcare industries, a result of the collective effort by both public and private practitioners. We are on track within the next decade to be an important medical hub attracting thousands of medical tourists from all over the world.

Thus, it is not an overstatement to say that our current medical industry is productive, innovate and competitive by any international benchmark.

Second, when in doubt as to compliance with the Competition Act, the SMA should have sought conclusive legal advice.

It was reported that the total cost incurred may run up to $200,000 and the SMA felt that it was excessive. (Editor's note: The Competition Commission has since clarified that the fees are not of this amount. See page 3.)

How can an association with well paid professionals not be able to fork out $200,000 when making such an important decision? I find this hard to stomach.

Third, besides seeking conclusive legal advice, the SMA should also have approached the relevant Ministry to clarify its doubts.

The Section (8) of the Competition Act explicitly states that "The Minister may give such general directions, not inconsistent with the provisions of this Act, relating to the policy the Commission is to observe in the exercise of its powers, the performance of its functions and the discharge of its duties as the Minister considers necessary, and the Commission shall give effect to any such directions."

To sum it up nicely, our Minister does have the final say.

The SMA should have at least notified our Health Minister rather than surprised him through the public medium.

This sudden move does not appear to be well thought through and I hope both the SMA and the Health Ministry can give more insights into this. There is really no conclusive justification to make a radical change now.

We have done well in recent years containing the rise of medical costs. Let's not shift into a reverse gear.


Mr Chua echoes angry doc's sentiments that SMA might have acted unwisely on this issue. Now that the cost of obtaining a decision from the Competition Commission has been clarified to be lower than the $200,000 expected, perhaps SMA will seek a ruling and review its decision.