• The health system that is Singapore’s

    As Haseltine notes, the medical savings account is only one small element of Singapore’s health system, even if it is the one that has attracted most attention. It has never accounted for more that 10% of total health expenditure. As he shows, it only works by being wrapped up in a complex network of mechanisms that compensate for its failure to deal with the fundamental challenge in delivering universal healthcare—those in most need of healthcare, typically older and poorer people, are least able to pay for it. [...]

    The cost of care is limited by major subsidies to hospitals—up to 80% of the cost of inpatient treatment—on top of other payments for capital expenditure. There are also strict controls on what hospitals can do and what they can charge, including limits on purchase of advanced technology.

    That’s Martin McKee and Reinhard Busse in a BMJ editorial on William Haseltine’s new book on Singapore’s health system. Apparently, Haseltine was motivated to write it because he searched and could not find a satisfactory, detailed explanation for how Singapore’s system works. I share his frustration and am grateful he did the work.

    As of this writing, the Kindle edition is free on Amazon. I downloaded and began to read it this past Saturday. So far, so good. Prior TIE posts on Singapore’s health system are here.

    UPDATE: Here’s Haseltine speaking at Brookings about Singapore’s health system. (H/t Brad Flansbaum.)


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    • Martin and Reinhard are right that the MSAs by themselves don’t account for Singapore’s excellent performance. I wish they had explained a bit further. I wish they had had explained how the MSAs
      (and other subsidy sources) work to ensure access and protect from catastrophic costs while allowing patients and providers to interact within a structured market environment – where patient choice directly influences providers’ income; and where patients are conscious of cost for most services.
      Choice as an accountability mechanism gives patients’ leverage in their interactions with providers – and generates Singapore’s relatively good performance wrt responsiveness; and, the fact that providers get paid partly based on output contributes to Singapore’s relatively high productivity and efficiency.
      Since people pay fees for most services they are cost conscious. And this consciousness contributes to constraining providers from increasing prices. Singapore’s low prices are one of the factors driving their strong performance as a medical tourism destination – as well as contributing to the systems’ remarkable cost efficiency (total spending on healthcare in Singapore is 3.9% of GDP, about a third of the European average).

    • And the medical tourism works in the opposite direction. Singaporeans will travel abroad for health care if it makes financial sense.