Angry Doctor

Monday, April 23, 2007

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.



  • Hi Angry doc,

    Sorry. I am the anonymous who wrote to you regarding my pregnant wife and our 25 week old baby.

    I must apologize. I thought that if someone earned $100K a year then based on the income tax levels for 2006 that puts that person in the top 16% of income earners paying tax in 2006. Figures below

    20,000 & below -
    20,001 - 25,000 18,882
    25,001 - 30,000 58,095
    30,001 - 40,000 166,813
    40,001 - 50,000 120,372
    50,001 - 60,000 79,031
    60,001 - 70,000 54,128
    70,001 - 80,000 39,759
    80,001 - 100,000 50,461
    100,001 - 150,000 57,354
    150,001 - 200,000 23,135
    200,001 - 300,000 20,627
    300,001 - 400,000 8,190
    400,001 - 500,000 3,731
    500,001 - 1,000,000 4,712
    1,000,001 & above 1,724
    Total 707,014

    Thinking I was in the top 16%, I had the impression that the hospital would FORCE me to be a paying class patient with NO SUBSIDY AT ALL because I would be classified as someone who can afford it.

    I didn't know that the means testing that MOH is lining up is only for C class. So it means that anybody can still choose B2 class?

    I guess if that's the case then it's not so bad. Phew! I was beginning to think that I might have to start paying instalments for the hospital bill which is more than my HDB flat!

    Sorry for the misunderstanding and thanks for pointing out the facts to me.

    PS : Are there any black and white details of how MOH's means testing will be? Where did you get the details about anybody including those earning 100K a year and above would be allowed to stay in B2 class?

    By Anonymous Anonymous, At April 23, 2007 5:40 pm  

  • No worries.

    One of the reasons why people fear means testing is because we don't know how exactly it will affect us. Details are still scanty, but so far it sounds like MOH will still let people stay in C-class wards if they fail the means test, but give them less subsidy. Given that C-class subsidy is 80%, and that B2-class subsidy is 65%, the figure for those who fail means test but still stay in C-class is probably a figure in between the two. I use the B2-class figure as a 'worse'-case figure.

    The figure I am using for my discussions is not an annual income of $100K, but a monthly per capita family income of $1000 (which is more stringent than an annual income of $100K).

    I use that figure based on the information given here:

    I am not sure if that is still current, but $1000 monthly per capita is also the cut-off used for subsidy at the nursing home level:

    I think it's a reasonbale figure to use for our discussions.

    By Blogger angry doc, At April 23, 2007 7:14 pm  

  • I am really impressed by this rebuttal post, angrydoc! Sometimes, it's helpful to know some math.

    By Blogger tscd, At April 24, 2007 3:09 pm  

  • Provided my figures and calculations are correct, that is...

    By Blogger angry doc, At April 24, 2007 5:07 pm  

  • AngryDr,

    I can see that you understand the word affordable well. Our HDB flats which is the most expensive public housing is also affordable.

    Since $250K flats are affordable surely $81K medical bills are also affordable. What is wrong with $200K medical bills, since the $250K flat is affordable.

    Of course if a person makes $200K a year, no medical bill is unaffordable. Really...

    You're right - The problem is with the higher end spectrum of medical bills. How much to squeeze middle class families whose incoem is about $5000 a month. Is $80K too much? Is $100K too much? ...

    You see such huge bill especially those in ICU coincide with very serious illness. Families are already trying to cope with a crisis and now they have to worry about the $80K or $100K medical bill dangling over heads. Come on this is a 1st world govt! This is a govt that comes at an affordable multi-million per minister. This is a govt that promised us Swiss Standard of Living....Surely they won't abandon us at our time of crisis to save tax payer dollars which they happily spend $10.6B on defense and several billion on R&D that historically produced little tangible results. Surely, when we talk about severe illness when we need our beloved govt the most, they will be there for us.

    Why this obsession with "saving tax payers' money" by cutting down subsidy through means testing? How come this obsession to save tax payers' money does not extend to our R&D spending that produced no tangible results to our defense spending which keeps increasing. Why all this effort "save tax payers' money" when it is no more than one-tenth per year what we lost in Shin Corp?

    There are many trade off in govt spending. Don't be mistaken that this great govt cannot afford to help those with big medical bills, it is a question of how much they want to squeeze out of families.

    For the family with the $70K medical bill which I put up on my blog. THey are not dying. They are not starving. The mother had to quit her job to look after the sick child at home which is a 24hour task with medication, month checkups. The emotional strain is already enormous, not to mention the financial strain. The big medical bill is now paid as month instalments...and the regular check ups/tests cost money. This is affordable? By the PAP govt definition it is. But this is the greatest govt in the world, the highest paid, can't they aim for something better? Will our country's finances collapse and our economy sink if we help the severely sick (which is a small minority) more?

    Sorry for the rant, I woke up angry and forgot to take my blue pills.

    I still don't understand how a family with a per capita income of $1000 can afford a medical bill of $81K. Of course families with $200K income will have no problem. You are right it is a crude tool. Using a crude tool on sick people is a cruel isn't it?

    What is the meaning of affordable anyway? Without defining this word affordable, there is alot of latitude for squeezing. Since the govt sounds sincere when it express its desire to keep medical care "affordable". Can they tell us how much maximum would they consider affordable for a family with per capita income of $1000?

    By Blogger Lucky Tan, At May 01, 2007 7:16 am  

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