SINGAPORE - The cost of healthcare in the private sector far outstrips what private patients in public hospitals pay, and part of the reason for this is the lack of fee guidelines and more patients whose insurance pays the whole cost of their treatments.
This has resulted in sharp increases in insurance payouts, which in turn pushes up premiums people have to pay.
An 11-member task force set up by the Life Insurance Association (LIA) of Singapore, including two members each from the Ministry of Health (MOH) and the Monetary Authority of Singapore (MAS), has released recommendations on how to rein in runaway healthcare costs.
- Have fee guidelines - currently not allowed as they are seen as anti-competition - to reduce overcharging and to "empower insurers to detect inflated claims".
- Streamline an existing process so insurers can raise suspected inappropriate or excessive medical treatments to the Singapore Medical Council, the professional watchdog.
- Insurers should have a panel of preferred healthcare providers who charge reasonable fees to help manage costs. This is done in other countries. Patients can opt for other doctors or hospitals, but doing so could affect the amount of their bill covered by insurance.
- The number of people who have bought riders, which cover their entire medical bill, has gone up from less than one in five residents in 2011 to one in three today. Half the people who have bought integrated health insurance plans (IPs), which cover non-subsidised treatments, have riders today. Patients with riders generally have bills that are 20-25 per cent higher than those who have to bear a share of the cost. The task force suggested the six insurance companies offering IPs tweak their products so patients pay a share of the bill to prevent the "buffet syndrome" which occurs when patients are "insulated from the cost".
- Require pre-authorisation from the insurer for treatments, so the insurer can "assess the medical necessity" and so patients know that the treatment is covered by their insurance. This is also practised in other countries.
The task force, headed by Ms Mimi Ho of financial consultancy firm Regulatory Professionals, also suggested greater consumer education so more people would "actively manage their health and healthcare costs".
The MOH on Thursday (Oct 13) issued a press release hailing the report as "timely and commendable".
It said there was value to fee transparency and "will continue to work with healthcare providers and IP insurers on ways to further improve fee transparency".
Last week, the ministry made public the range of fees charged by private hospitals and specialists for a large number of common procedures.
MOH agreed that co-payment by patients, a "key tenet" in its healthcare financing framework, "helps to guard against over-consumption and over-treatment".
It said: "The absence of any co-payment may encourage over-consumption by some patients and over-servicing or over-charging by some healthcare providers which will eventually increase healthcare costs and insurance premiums for all Singaporeans."