Jeremy Lim For The Straits Times

How to reassure Ah Pek on the Pioneer Package

If the intended recipients do not understand the PGP, it is difficult for them to feel reassured. The Government has prioritised communicating its benefits, but perhaps the challenge really lies in the complexity of the design.
If the intended recipients do not understand the PGP, it is difficult for them to feel reassured. The Government has prioritised communicating its benefits, but perhaps the challenge really lies in the complexity of the design.BT FILE PHOTO

Amid the euphoria of the Pioneer Generation Package (PGP) announcements, it is hard to be a wet blanket. In fact, it seems almost churlish to question the package of medical subsidies the Government has committed to giving the "pioneer generation", or those aged 65 and above.

But before the headlong rush into implementing the package, it would be timely to step back and ask whether there are aspects that can be done differently. I do not doubt the Government's sincerity and commitment. At the same time, one cannot help but wonder whether the package will fully achieve its twin objectives of providing our pioneers with not only lifelong medical care but also financial peace of mind.

The great artist and inventor Leonardo da Vinci elegantly articulated: "Simplicity is the ultimate sophistication". For the PGP, simplicity is vital. The scheme targets citizens who are educationally, linguistically and socially diverse. Policymakers have to deliver messages simple enough to be understood and yet powerful enough to resonate.

If one does not understand, it is difficult to feel reassured.

A recent survey highlighted that seven in 10 Singaporeans had heard of the PGP but more than half admitted they did not know or understand the benefits. The statistics among the target group, the pioneers, I suspect would be even more modest.

It is striking that in rolling out the PGP, the Government has found it necessary to establish a task force, helmed by two ministers, which has prioritised communicating the benefits to the intended recipients. Co-chairman of the task force, Senior Minister of State for Health, Dr Amy Khor, described last month plans to train 1,000 front-line staff and said that the Government would be "running through with them the various questions and concerns that Singaporeans may have regarding health-care subsidies and also to help them address some of these questions and concerns to provide reassurance to patients".

Perhaps the challenge really lies in the complexity of the design. From a policy perspective, the PGP sits on top of the existing 3M (Medisave, MediShield, Medifund), Chas (Community Health Assist Scheme) and CDMP (Chronic Disease Management Programme) schemes, which arguably, most Singaporeans do not fully understand anyway. In the proposed system, there are multiple tiers of subsidy depending on whether the presenting disease is deemed "simple" or "complex", whether the disease is included in the CDMP, and so on.

The contrast with many countries with universal health coverage is stark. The message should be simple: At the point you need health care, concentrate on getting well; don't worry about money. In many schemes globally, there are no co-payments required, or if there are, these are in the form of fixed amounts with annual limits. In Singapore, the individual's co-payment can soar while the Government's share (subsidy amount) is capped.

Australia announced in its Budget last week that the government would impose a A$7 (S$8.20) co-payment for each visit to the general practitioner, up to a total of A$70 a year for concessional patients.

No caveats depending on type of disease, no exclusions depending on housing type or income. Just a simple A$7 figure to understand and remember.

This brings me to the second point. It is better to frame the scheme to be viewed through the lens of the pioneer and not the policymaker.

While $9 billion is an admirable commitment to the health- care needs of the pioneer generation, the pioneer would much rather know what he needs to pay individually rather than the amount the Government subsidises.

Imagine the thoughts running through the mind of a pioneer: "Yes, it is good to know there is a $28.50 per visit subsidy for a common illness like a cough or cold, but how much do I need to pay? Nothing? $10? $20? More?"

In stores, it is clever marketing to highlight a large discount - but what really matters to the customer is what he pays, not the discount. The Government's concerns over unanticipated costs and the instinct to safeguard public coffers are understandable and perhaps even natural.

But to the Singaporean living on $1,000 a month, a mis-estimation of the medical bill by $50 is 5 per cent of all he has; to the Government, the same mis-estimation occurring for even 10 per cent of our pioneers is $2.25 million, or barely a quarter of a per cent of the $9 billion allocated.

Perhaps the risk of getting the numbers wrong is a yoke easier borne by the Government's accountants than by elderly Singaporeans.

The PGP is the cornerstone of the Government's 2014 Budget. The Government has correctly read the minds of the pioneer generation that fears around health care weigh heavily.

The political will is there to make a difference; Prime Minister Lee Hsien Loong has declared to the pioneer generation that he and his Government will "make medical care always affordable for you".

Let's design the PGP such that every Singaporean in the pioneer generation can easily understand and use it, safe and secure in the comforting reassurance of a nation's gratitude.

The writer is a partner in the global consulting firm Oliver Wyman.