VZCZCXRO9952
RR RUEHCHI RUEHDT RUEHHM RUEHNH
DE RUEHGP #0965/01 2750959
ZNR UUUUU ZZH
R 020959Z OCT 09
FM AMEMBASSY SINGAPORE
TO RUEHC/SECSTATE WASHDC 7281
INFO RUCNASE/ASEAN MEMBER COLLECTIVE
RUEHPH/CDC ATLANTA GA
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEAUSA/DEPT OF HHS WASHDC

UNCLAS SECTION 01 OF 03 SINGAPORE 000965 
 
SENSITIVE 
SIPDIS 
 
STATE FOR OES/IHB 
DHHS FOR OGHA 
EAP/MTS - MCOPPOLA 
BANGKOK FOR REO HOWARD 
 
E.O. 12958: N/A 
TAGS: TBIO SOCI ECON SN
 
SUBJECT:  SINGAPORE'S HEALTHCARE SYSTEM:  ADDRESSING COSTS AND CARE 
 
REF:  A) 09 SINGAPORE 018 
B) 07 SINGAPORE 1844 
C) 07 SINGAPORE 371 
 
¶1. (SBU) SUMMARY:  Singapore's first graduate medical school, a 
partnership between Duke University and the National University of 
Singapore (NUS), opened September 29.  The physicians it graduates 
will increase Singapore's pool of new doctors and help the island 
address increased healthcare demands from an ageing population. 
Singapore, like the United States, is concerned about managing the 
rising costs of health care, but Singapore's health expenditure as a 
proportion of gross domestic product (GDP) remains a fraction of 
U.S. healthcare costs, and data show that Singaporeans enjoy longer 
life expectancy and lower infant mortality than Americans. 
Healthcare contacts credit lifestyle, competition between public and 
private health providers, and lower legal fees as key contributors 
to Singapore's lower healthcare burden.  Singapore is positioning 
itself as a medical travel destination while local healthcare 
entities are expanding globally.  End Summary. 
 
Medical School Opens; Doctors Wanted 
------------------------------------ 
 
¶2.  (SBU) Singapore's first dedicated graduate medical school, a 
partnership between Duke University and the National University of 
Singapore (NUS), opened September 29.  At the opening ceremony, 
Prime Minister Lee Hsien Loong noted that the school, which will 
train researchers and medical practitioners, will be an important 
step in Singapore's efforts to advance its healthcare system. 
Singapore, with a birth rate of only 1.28 and a relatively high 
median age of 39 years, must address rising healthcare costs and an 
ageing population.  Duke-NUS anticipates graduating 50 doctors a 
year, increasing the annual pool of new doctors to 350, which will 
help Singapore address future healthcare needs.  PM Lee indicated 
that the GOS will also consider other options to further add to the 
number of local doctors. 
 
¶3.  (SBU) Strict rules govern who can practice medicine in 
Singapore.  New graduates must work in public hospitals when they 
begin their careers and new graduates may be subject to a five or 
eight-year bond, depending on whether they studied on scholarship, 
Dr. Jason CH Yap, Director of Marketing at Raffles Hospital, told 
Econoff.  Foreign doctors with work experience abroad must complete 
a three-year term at a local public hospital before they can go into 
private practice, Yap continued.  This limits the private sector's 
ability to recruit foreign physicians and limits options for medical 
professionals living in Singapore temporarily (e.g., qualified 
spouses of executives assigned to Singapore for two years cannot 
work here). 
 
¶4.  (SBU) Physicians are groomed in the public health system but 
usually move to the private sector later in their careers.  Doctors 
at public hospitals advance quickly and heads of departments can be 
in their late 30's.  They are allowed to stay in such positions six 
to nine years and then must rotate out, Dr. Goh Jin Hian, Group 
Senior Vice President for Growth, Innovation and Strategy at private 
hospital operator Parkway Health, told Econoff.  At that point, most 
physicians choose to go into private practice, Goh said.  As a 
result, there is room for younger physicians to rise through the 
ranks, while the private sector often has the most experienced 
physicians, he added.  However, this rigid system keeps the overall 
pool of practicing physicians relatively low. 
 
No Universal Coverage, but Forced Savings 
----------------------------------------- 
 
¶5.  (U) Singapore does not offer universal health coverage per se, 
rather it makes saving for expenses like retirement and health care 
compulsory for individuals.  The government administers three 
programs to help cover the health costs of its population: 
Medisave, Medishield, and Medifund.  Medisave was established in 
1984 as a mandatory savings program for individuals to meet costs 
associated with hospitalization, outpatient surgery and certain 
other outpatient expenses.  The savings requirement is between 6.5 
and 9 percent, depending on age; people 35 or younger must save 6.5 
percent of their income, 35 to 45 year-olds 7.5 percent, 45 to 50 
year-olds must save 8.5 percent, while those 60 and above must save 
9 percent.  Employers must also contribute to their employees' 
Medisave accounts.  Medisave was recently expanded to allow patients 
to draw on accounts to cover outpatient services for diabetes, 
hypertension, hyperlipidemia, and stroke.  For those chronic 
conditions, the maximum amount that can be drawn from a Medisave 
account is S$300 (US$214) per year but patients can augment that 
 
SINGAPORE 00000965  002 OF 003 
 
 
with funds from family member accounts.  Patients still pay 
deductibles of about S$30 (US$21) and then 15 percent of the balance 
of outpatient bills. 
 
¶6.  (U) Medishield is a low-cost insurance plan that the GOS 
introduced in 1990 to cover "catastrophic" illness or accidents that 
outstrip the balances in individuals' Medisave accounts.  Private 
insurance options are also available to Singaporeans.  Medifund, 
akin to U.S. Medicaid, is an endowment fund established by the GOS 
to help Singaporeans who cannot pay their medical expenses, even 
with Medisave and Medishield.  Reports indicate that Medifund serves 
approximately ten percent of the Singaporean population. 
 
Quality Care is Not Always Equal Care 
------------------------------------- 
 
¶7.  (SBU) Traditionally, private healthcare providers handle about 
80 percent of primary and preventive healthcare services while 
subsidized government hospitals provide 80 percent of the more 
costly acute care.  There are seven public hospitals in Singapore 
and care is tiered based on patients' ability to pay what is not 
subsidized.  The lowest level "C" is 80 to 85 percent subsidized and 
patients are treated in multiple bed wards with communal bathrooms 
that often do not have air conditioning, Dr. Yap said.  While in the 
highest level "A", which is not subsidized, patients might be in 
single or double rooms with bathrooms.  Dr. Yap said that patients, 
regardless of subsidy level, will have access to the same medical 
tests, equipment and general care, so the GOS asserts that all 
patients receive quality health care.  However, Dr. Yap acknowledged 
that there are inequalities because C-level patients do not receive 
the same individual attention and may be at greater risk of hospital 
infection in a multiple-bed setting.  Hospitals conduct some means 
testing to ensure patients that can pay more are not taking up beds 
in the lower-level wards. 
 
Singapore to be Medical Travel Hub 
---------------------------------- 
 
¶8.  (SBU) Private hospitals like Raffles and those run by Parkway 
Health are competing for business from Singaporeans that could pay 
to receive A-level care in public hospitals, expatriates resident in 
Singapore, and overseas patients.  Dr. Yap and Dr. Goh estimated 
that approximately 30 to 40 percent of the patients in their 
hospitals were from countries like Malaysia, Indonesia and India. 
Dr. Goh noted optimistically that a recent amendment to Singapore's 
Human Organ Transplant Act (Ref A) that will allow compensation for 
unrelated living donors could increase the numbers of transplants 
performed at Singapore's private hospitals.  Dr. Goh said Singapore 
is not a medical "tourism" destination where people go for cosmetic 
surgery and recuperate in a vacation setting, like Thailand. 
Instead, Singapore is positioning itself as a medical travel 
destination that offers high-quality care for serious health issues 
at a more affordable price.  The Ministry of Health (MOH) Web site 
lists average costs for common medical procedures and online sources 
comparing medical expenses estimate that procedures like coronary 
artery bypass and coronary angioplasty can cost 75 percent less in 
Singapore than in the United States.  Dr. Goh said that U.S. health 
insurers were in discussions with Parkway Health regarding covering 
U.S. patients who seek care in Singapore. 
 
Factors Contributing to Lower Costs 
----------------------------------- 
 
¶9.  (SBU) Singapore spends approximately 3.4 percent of its GDP on 
healthcare, compared to more than 15 percent in the United States. 
Yet, Singaporeans have lower infant mortality and higher life 
expectancy than Americans, according to World Health Organization 
statistics.  Dr. Yap and Dr. Goh attributed the lower healthcare 
costs in Singapore to a number of factors, including lifestyle, 
government controls, competition, and a less litigious society. 
Breast and colorectal cancers, heart disease and stroke are still 
major killers in Singapore and chronic diseases like diabetes are on 
the rise, but widespread obesity is not yet a problem.  Compulsory 
National Service and the associated military fitness tests may 
encourage young men to adopt a healthier lifestyle, Dr. Goh 
surmised.  Singaporeans are good consumers of preventive care, 
spending approximately S$300 to S$400 (US$214-285) annually on 
health screening, he estimated.  Companies will also pay to have 
mobile clinics brought to their locations to screen employees. 
Private physicians and facilities are forced to compete for business 
with heavily subsidized polyclinics and public hospitals, which 
distorts the market but keeps costs low for consumers, Dr. Yap 
stated.  The average consultation fee at a local polyclinic can be 
 
SINGAPORE 00000965  003 OF 003 
 
 
as little as S$8.00 (US$5.70), according to MOH. 
 
¶10.  (SBU) Raising polyclinic fees would be a major policy issue, so 
the prospect of increasing fees in the public sector is limited, Dr. 
Yap stated.  To help augment the low consultation fees, MOH allows 
physicians to prescribe and dispense medicine, Dr. Goh and Dr. Yap 
noted.  The pharmaceutical industry would like to see prescribing 
and dispensing rights separated (Ref B), but such a change would 
take time and careful planning as Singapore would suddenly need 500 
more pharmacists, Dr. Yap estimated.  The government also controls 
which pharmaceuticals are allowed onto the Standard Drug List (SDL), 
which restricts the drugs public-sector healthcare providers can 
prescribe.  (Note: According to contacts at a major U.S. 
pharmaceutical company operating in Singapore, the opaque SDL 
process described in ref C remains a concern.  End Note.) 
 
¶11.  (SBU) Dr. Yap also noted that compared to the United States, 
healthcare providers in Singapore do not have the same 
administrative and legal costs.  He said that there are few 
malpractice lawsuits in Singapore and most hospitals try to deal 
with a patient issue internally.  Dr. Yap indicated that malpractice 
awards usually only cover medical expenses and lost income.  He said 
the highest payout he was aware of was S$2 million (US$1.4 
million). 
 
Private Healthcare Providers Going Global 
----------------------------------------- 
 
¶12.  (SBU) Both Raffles Medical Group, the parent company of Raffles 
Hospital, and Parkway Health are expanding overseas.  Raffles is 
going global conservatively and currently has three clinics in Hong 
Kong, Dr. Yap said.  Parkway Health has projects in the Middle East 
and India, but Dr. Goh noted that Parkway had been burned in a few 
deals, so their overseas operations tend to be consulting or 
operations contracts and not capital-intensive projects.  Parkway 
Health won a bid last year to manage a women and children's hospital 
in Abu Dhabi.  Neither Parkway nor Raffles have expansion plans for 
the United States. 
 
SHIELDS