Subsidy and Other Preoccupations 20

It's not fair, is it? Making angry doc angry on a Sunday morning...


(emphasis mine)

Means testing on track for implementation in January 2009
By May Wong, Channel NewsAsia

SINGAPORE : The government is on track to implement means testing in January next year at all public hospitals.

Health Minister Khaw Boon Wan said preparations are on-going to link up with agencies like the Central Provident Fund Board and the Inland Revenue Authority.

Means testing helps to focus healthcare resources to needy Singaporeans, with low-income citizens receiving higher government subsidies.

Mr Khaw was speaking to reporters after launching a campaign on colorectal cancer on Saturday.

[snip]

Means testing will ensure lower-income Singaporeans have access to subsidised wards like C-class hospital beds.

This scheme will also ensure such beds are not overcrowded by those who can afford higher medical bills.

Mr Khaw said: "I expect a January implementation which is hassle free and ought to be uneventful. (The) majority will not have a problem with means testing and (for) a small minority of high-income patients, the criteria are very generous, so they'll be expected to pay a little bit more, but not a lot more. (It will be) well within their affordability level. So Singaporeans need not worry."

[snip]


It doesn't quite add up, does it?

Let's look at the statements angry doc highlighted in turn.


"Means testing helps to focus healthcare resources to needy Singaporeans, with low-income citizens receiving higher government subsidies."


While the statement is technically true, it is misleading: "low-income" citizens are not going to enjoy higher subsidies than they already do now; instead, "high-income" citizens are going to enjoy lower subsidies than they already do now.

As the minster put it:

"a small minority of high-income patients... they'll be expected to pay a little bit more, but not a lot more."


How much more is "a little bit more"?

A patient with monthly a income of $5,201 and above will receive a 65% subsidy for Class C instead of the usual 80%, while a patient whose income falls between $3,201 and $5,200 will receive a subsidy of between 65-80%.

Given that "the scheme will not affect 80 per cent of Singaporeans", this means that (assuming similar bill sizes between the two groups) even if we assume that the 20% of patients who fail means testing all receive only 65% subsidies instead of 80%, we stand to 'save' 6.25% of spendings in terms of subsidies*. angry doc agrees with the minister that this is "not a lot".

If we take into account the fact that some of these 20% of patients would not have chosen to stay in a C-class bed to begin with, means testing or no, then the 'savings' will be even less than 6.25%.

So let's say means testing allows us to "focus" this 6.25% in "resources" to low-income patients; will it "ensure such [subsidised] beds are not overcrowded by those who can afford higher medical bills"?

angry doc doesn't think so, since according to the FAQ on Means Testing on the MOH site:

"Patients will still retain their freedom to choose their ward class. Any patient, regardless of whether they are rich or poor, can choose to be admitted to a Class C or B2 ward. They will still be heavily subsidized, but at different rates."

So they are free to choose their ward class, they are "heavily subsidized", but the MOH nevertheless expects them to *not* choose a C-class bed. Interesting.

And if they are still free to choose a C-class bed (and who wouldn't? It *is* "heavily subsidized"!), will means testing still "ensure lower-income Singaporeans have access to subsidised wards like C-class hospital beds"?

angry doc will leave his readers to answer that question for themselves.


* - angry doc's maths is poor, so do let him know if he made a error there.