Follow The Money Trail

Doctors In The Crosshairs

On 2 May 23, a certain financial advisor by the name of Francis How Chee Kuen wrote to The Straits Time Forum stating, “Many years ago, IPs (Integrated Shield Plans) were more affordable, but doctors have been charging high prices for their services, leading to insurers increasing their premiums. Premiums will continue to rise if doctors overcharge or mark up prices”. The letter was titled, “Holistic approach needed to tackle cancer care costs”

He gave an example of one his clients having to pay $3000 out of $5000 a month when the new Cancer Drug List (CDL) is enforced in February 2024. He ends off the letter by saying “In our battle to contain cancer treatment costs, we can’t just be targeting the insurers and capping coverage. Instead, the whole issue needs to be addressed holistically and from all angles”.

“Holistic” is a very politically-correct word nowadays, but using such a big word doesn’t make one’s argument any more complete and persuasive than making a monkey wear a skirt or a pair of pants and calling it human.

What this Mr How is actually saying is, doctors overcharging and making mark-ups to their services is the root of the problem. He also said in the same letter that pharmaceutical companies should be subject to scrutiny as well. And the system should not be just targeting insurers and insurance coverage in an attempt to contain costs.

Just Being Human

This hobbit’s answer to Mr How is quite simple – Everybody wants to make a good living and put bread on the table. These includes doctors, employees of pharmaceutical companies such as pharma reps and insurance agents (now called financial advisors).

So let’s cut to the chase. Everyone wants to defend or maintain if not increase the money they are making. Because doctors, insurance companies and their financial advisors as well as pharmaceutical companies and their sales representatives are humans and no one wants to suffer a loss of earnings. This is true for a communist society and even truer for a market and capitalist economy like Singapore. It is true whether you are making $4,000 a month or $4,000 a day. Nobody wants to then earn $3,000 a month when he was earning $4,000 a month or $3,000 a day when he is used to earning $4,000 a day. It’s human nature.

Let’s start with the insurance industry itself and their financial advisors. In the four years leading up to the Pandemic (2016-2019), the growth rate in management costs and commissions (paid to insurance agents and financial advisors) was actually faster than payments made to the healthcare providers. This could be easily inferred from a study made by the Singapore Actuarial Society. ( (Table A4 of Medishield Life 2020 Review: SAS Comments). From this data, we can reasonably conclude that insurance companies and financial advisors are not exactly doing this for charity. They also want to make money, and probably as much as legally possible.

Now, let’s turn to the doctors. According to the 2021 SMC Annual Report, there are about 50 medical oncologists in the private sector. These 50 will prescribe the bulk of cancer drugs in the private sector, although there are also many other specialists who prescribe cancer drugs.

So it is probably expedient to focus on these 50 specialists and say they overcharge or have mark-ups and use ineffective cancer drugs. Especially if many of them are big earners. Are all 50 completely blameless? Probably not. But that’s not the point. By the way, no medical oncologist has actually been convicted of overcharging by SMC or in the courts.

Moreover, Mr Frances How used the case of his patient from a restructured hospital, which to this hobbit, makes no sense because as everyone knows, a doctor in a restructured hospital has no input on decisions of drug price. He does the work and the hospital decides on the prices based on costs. Unless he is thinking that even restructured hospitals unreasonably mark-up their services.

Which means that he is either illogical, uninformed or he must think the problem lies elsewhere – i.e. the pharmaceutical companies. Well, pharmaceutical companies are for-profit companies that will expectedly maximise their profit. Why do you want to sell a cancer drug for $3,000 when you can sell it for $5,000? Especially in this case, your customers have paid insurance premiums that will fund most if not all of the $5,000.

So, there is no use in pointing fingers at doctors or pharmaceutical companies. Everybody is behaving as expected. It is more fruitful to, as the saying goes, “follow the money trail” by revisiting why people pay for IPs, especially pertaining to IP cancer care coverage.

We Should Be Anti-social

Since the introduction of the CDL, the IP providers have come up with riders for coverage of cancer drugs that the CDL either does not cover or where the CDL-based reimbursement caps are perceived to be insufficient to cover the actual cost of treatment. These riders are to be paid for in cash. There is a concern in some circles that if too many people buy these riders, the issue of expensive cancer drugs gets “socialised” to a huge segment of society, thereby undermining the efforts of introducing the CDL and claims caps etc to control costs.

In an article published in The Straits Times on 24 April 23, it was reported that the Minister for Health said “now that riders provide higher cancer coverage, their premiums will need to be priced higher. If this results in fewer people buying riders, “I think we have addressed the problem”. But if riders continue to be in high demand, notwithstanding high premiums, that would be a problem and MOH and the MAS are prepared to step in.”

This reporting by Ms Salma Khalik is a relief to this hobbit because it shows that MAS, the body empowered by law to directly regulate insurance companies (not MOH) is now finally prepared to step in on matters that are medical-related. This hobbit does not remember MAS stepping in to regulate IP providers in any meaningful way other than for non-medical issues and have appeared to be content to let MOH to do the heavy lifting in this area. Perhaps they have finally crossed over to a higher plane of enlightenment, which is good.

However, this hobbit thinks many people will buy these riders, which means the problem is likely to persist. We will look at this issue from both the demand and supply sides.

Demand Side

First, on the demand side, there will be a healthy interest in buying these riders:- The whole purpose of buying IP is to finance a person’s medical expenses in the private patient classes (A1 or B1 class) of a restructured hospital or in a private sector hospital when he gets a catastrophic disease. Cancer is an example of a catastrophic medical event and more than a quarter of Singaporeans will die from it and more than 40% will get it in their lifetime, i.e. getting a cancer is NOT a remote and rare event.

So it usually makes little sense if I have an IP but it is perceived that the IP is insufficient to fund private oncology care (Restructured B1 or A1 or private hospital patient). If I have an IP now I would be inclined to buy the rider, just for peace of mind and the high probability that I will need and use the rider, unless I find the rider really quite unaffordable.

There are also secondary factors that contribute to uncertainty and hence create more demand for riders (and for peace of mind):

  • The current messaging is not good for IPs that are sold without a rider. The new limit of paying only for the most expensive cancer drug (should more than one be used at the same time) gives the impression that a IP policyholder sans cancer rider has to pay out of pocket for the remaining drugs, should the policyholder need more than one drug, even though the reimbursement limit is actually quite generous.
  • The monthly limit for CDL claims can be seen to be archaic when chemotherapy cycles are now commonly 6 weeks along, leading to unutilised claim limits in some months and bursting the limits in other months, in which case the policyholder may have to top-up the difference in these other months.

Supply Side

On the supply side, there are two structural problems with the current IP environment that leads to the situation where the IP sector is unable to effectively complement Medishield Life (MSL). As this hobbit will show you, it can even undermine the policy intent of MSL. By design, the IP policy sits on top of MSL so the two are entwined like Siamese twins. If one of the twins are unwell, the other feels it too.

Problem #1: MSL Is For Life While IP Is An Annual Plan

Being an annual plan means the IP sector is in permanent dissonance with MSL. This dissonance is not just structural, but strategic, financial and behavioural as well. While MSL looks at the lifetime needs of its policyholders, IP executives and financial advisors are incentivised to think mainly short-term.

The executives who run IP providers are rewarded mainly for the IP’s financial performance on a year-by-year-basis. Financial advisors’ commissions are also heavily front-loaded and diminish very significantly after a policy is sold after say, about 2 to 3 years.

Problem #2: Too Many IP Providers

According to the financial advice website Singsaver, there are close to 3 million IP policyholders. This is about right if you consider the oft-quoted claim that close to 70% of Singapore residents (i.e. citizens and PRs) have bought IPs. Most insurance experts will tell you that 3M is a rather small pool to be shared among seven providers. It is quite unlikely that market penetration will rise much beyond 70% because the poorest 30% will probably find IP premiums very unaffordable.

To sustain seven IP providers, each IP provider will have to look for new customers to sign up. These new customers can come from either other IPs’ customer base or those that have not signed up with any IP, especially young adults entering the workforce and earning a decent salary. In any case, because of the relatively small pool of addressable IP customers, there is intense competition for new customers among all IP providers so that the IP providers can maintain or grow their market share.

One of the most important determinants of selecting an IP is of course, price. IP providers have to compete on price. But an interesting facet of the IP industry is that price competition is only critical when a person decides to buy an IP and when he renews his IP while he is still young with no pre-existing diseases. Once an IP policyholder has pre-existing diseases he is basically stuck with the same IP provider if he wants to continue having IP coverage for these diseases. He then effectively has only two choices – stay on and pay the increased premiums with the same IP provider or drop out of the market completely.

In other words, once pre-existing diseases kick in, IP is a very sticky business. Which is why despite some IP providers periodically “cry father, cry mother” about how tough and unsustainable the IP market is, no provider has exited the scene yet. Customer stickiness is a good thing when you are a business owner or operator.

And So….

In summary, this culminates in a situation whereby IP providers compete aggressively for customers up front by slashing prices but do not similarly compete so intensely on “after-sales” service and care quality later. That is why they do not have to respect MOH fee benchmarks in its entirety and also seek not to have more doctors empanelled. When you’re stuck to your IP provider because of pre-existing diseases, you’re stuck real good.

We say that healthcare is ultimately determined by the Golden Triangle of Affordability, Accessibility and Quality.

But in reality, the business model of IP is probably based on maximal affordability up-front and denial or limitation of accessibility later with minimal if any respect for quality, so that profits can be maximised.

This can be largely attributed to the two features described above:

  • IP policies is an annual plan while MSL is for life, resulting in multi-faceted dissonance between the two and
  • There are too many IP providers fighting for a small pie up front which paradoxically becomes a sticky business post-sales.

So it is likely that cancer riders will be popular because there are factors on both the demand and supply side that lead to such a fertile milieu for the sale and purchase of these riders.

But what if the revenue from these riders cannot adequately pay for the cancer services incurred later on? As usual, IP providers can raise premiums to a limited extent before policyholders drop out, or restrict accessibility by empanelling as few specialists as possible.

They also have a third trick up their sleeves – which is to blame service providers such as doctors and hospitals for being expensive as well as chastise pharmaceutical companies for excessive mark-ups. And then the cycle may repeat itself – there may be some task force or committee formed that will try to control costs by introducing measures that mainly target healthcare providers while IP providers pay lip service to the recommendations that would have been  put up, which is essentially what happened with the HITC’s work (Health Insurance Task Force) a few years ago.

If you think about it carefully, the interests of IP providers and their financial advisors are almost diametrically opposite to that of the government. The government is always about long-term sustainability while the IP sector is short-term. The government doesn’t want too many buying such riders lest the problem gets socialised. The IP sector on the other hand wants more and more people to buy riders, thereby indirectly socialising the issue. This applies to cancer care and can be applied to the whole IP industry as a whole. The money trail starts with the how the IP sector is structured while at the same time there are too many IP providers for a relatively small market. And these lead to other consequences when other stakeholders also want a piece of the pie. The trouble is everyone wants the biggest slice of the biggest pie. And somehow the insurance industry has been the most adept at this game so far, by blaming others and positioning itself as mostly blameless.

But the truth is, everyone is human and human nature prevails. Unless you’re a hobbit.

Previous posts on the subject of IP:

In Search Of A Better Life

In the 10 years preceding Covid-19, from 2009 to 2019, MOH Budget tripled from S$3.7B to S$11.7B. In FY2022, MOH Budget peaked at 19.29B, understandably so, due to the demands brought on by fighting the Pandemic. In the current FY2023, the MOH Budget has shrunk a bit to S$16.8B, as we gradually leave the Pandemic behind us. S$16.8B is still 44% more than what was budgeted in the year preceding the Pandemic, in FY2019. That’s still a lot of growth. And if we extrapolate back to 2009, the 2023 MOH budget is 4.5 times larger than what it was in 2009, a mere 14 years ago.

In any other country that this hobbit can think of, if the government pumped so much money so quickly into the system, you would imagine that there would be better morale amongst healthcare workers in the public sector, because ultimately an influx of such magnitude so rapidly would lead to better pay or more staff to share the workload, or both.

However, when this hobbit talks to young doctors, the mood cannot be more different. It is not uncommonly a spirit of resignation and defeat. Many are heading for the exits, or at least seriously contemplating so. And this is very worrisome. Because as this Hobbit grows older, he needs more and more medical care and he would like to treated by doctors who are at the very least satisfied with their professional lives.

There are many reasons given for this unhappiness. Many of these reasons have been discussed in detail before – excessive and unsatisfying paperwork and administrative duties, unreasonable patients and family members who may even abuse them, bosses who are overly demanding, an environment intolerant of mistakes and even underperforming hospital IT systems etc.

As this hobbit approaches the autumn if not winter of his medical life, he has the luxury of looking back. If he had to live his life again, would he have chosen to apply for Medicine in the local university when he turned 19 so long ago? The answer is still a “yes”. I cannot say the same thing for folks turning 19 now in 2023, though. And that’s the difference.

Wanting and choosing a career in medicine involved many things that haven’t changed much since then: it is a calling, hard work, long hours, sacrifice, satisfaction, status etc.

Over the years, there is also another constant that medical school admission interviewees don’t mention much, but many want to be doctors because they were in search of a better life. I’ll be honest here, one of the bigger reasons why this hobbit chose medicine as a career was that he believed this career would lead him to a better life. A career in medicine has largely delivered on this count for me.

In itself, there is nothing wrong with wanting a better life. One can even say it is a human right to want a better life, similar to the pursuit of freedom, happiness and human dignity.

But what is a better life? To answer this question, we must first recognise “better” is a word that has connotations of relativity. Better than what or who?

• Better than your peers who after A levels or junior college went on to choose other careers?
• Better than what your parents managed to provide for you when you were growing up or that you can provide for your children better material comforts than what your parents provided for you?
• Better than what your seniors in the medical profession could achieve?
• Better than what your classmates in medical school could achieve?

Whether we like it or not, most of the time, this “better” involves material possessions and wealth. Of course, there are a few who do not consider measures of material wealth being pertinent at all; these include admirable folks who go on to work in NGOs, become missionaries etc. But these are the exceptions.

Also, a lot of what a better life depends on where is your starting point. If you grew up in a 2-bedroom rental Singapore Improvement Trust flat or a 3-bedroom HDB flat and taking the bus to school, then buying your first executive condominium at 32 or your first small second-hand car at 30 usually means medicine has indeed given you a better life, materially speaking.

But if you grew up in a freehold landed property in Districts 9, 10 or 11 and you were fetched to school by your parents or even chauffeured in a nice big car from Primary 1 to JC2, then ending up in an executive condominium and buying that small second-car car as a medical officer is not a big thing. In fact, you may start to wonder if being a doctor will ever lead you to a “better” life, without parental assistance in the form of paying for the down-payment of the condominium and/or helping you with paying for that $100,000 Category A COE. And then you may even start to doubt if you will ever make it to a Category B COE vehicle in your lifetime, given how things are going.

What constitutes “a better life” is a tough question that each generation of doctors have to face and answer themselves. Because no one can answer these questions for them.

But the facts are not on young doctors side. 30 to 40 years ago, 150 to 200 students were chosen to read medicine locally out of a cohort size of about 60,000. Another maybe 30 to 50 kids were rich enough to go overseas. In other words, about 200 to 250 medical graduates were produced a year from local and overseas medical schools. Today, a total of 700 medical graduates are produced a year (500 local and 200 overseas), out of a cohort size of about 35,000 to 39,000.

Put it another way, when this hobbit entered medical school, there was one doctor to 1000 persons in Singapore. Now there are 2.7 doctors to 1000 persons. This figure is likely to reach 3 in a few years’ time. While an ageing or aged population will create more demand for medical services, it is unlikely to fully offset the effect of a quickly growing medical profession. In other words, there will be less work for each doctor, which will likely translate into less earning power.

You can see it especially in the private specialist sector. 30 to 40 years ago, nobody really worried about not enough work when they went private. 20 years ago people worried a little but in the end, nobody was short of work either. Today, not having enough patients is a real concern.

The public sector is not spared either. Recently, a senior public sector doctor posted in social media that 25% of doctors in public hospitals were senior consultants. Senior consultants used to be a rarity, now no longer. I hear in some top-heavy tertiary hospitals some consultants only have half a day of operating theatre time a week.

Doctoring is no longer an uncommon thing, like in the past.

We always say medicine is a calling. Only those that receive that calling should become a doctor. This hobbit still believes this to be true. But we need also to be honest and admit if we use the old perceptions and definitions of what a better life is, then medicine is unlikely to deliver the goods for many doctors. And young men and women who aspire to be doctors today should know these hard truths before committing to a career in medicine.

They will need to decide for themselves what are the new norms for defining a better life. And that may already be taking place even as we speak. Maybe that’s why young doctors now talk about better work-life balance and quality of life. Because these are the ingredients for a better life that they can still hope for today.

Could We Or Covids Have Done Better

The Covid-19 White Paper was released on 8 March 23. This hobbit thinks this was a very commendable effort to look back at what happened that was led by a former Head of Civil Service that is known for his frankness and clarity of thought.

It correctly identified the two major shortcomings made by the government – the U-turn in mask policy and the blow-up in cases that happened in foreign worker dormitories. And this in itself, is a win for transparency and humility. Two very rare commodities in the world nowadays. It is also noteworthy that the two errors arose from essentially the heuristic error of anchoring. Just because the coronavirus in SARS was infectious only when the patient had fever doesn’t mean that another coronavirus will behave likewise. We were anchoring on our past experience with the SARS virus and hoping the Covid-19 virus will behave likewise.

But enough big talk. Now for the small talk that regular readers of this column seem to enjoy much. There are some episodes during the pandemic that are worth remembering but not mentioned in the White paper, just for laughs, if nothing more. These include:

The Virus Vanguard. These are official superheroes no less, since they first appeared in government Facebook webpages, albeit for about only a day in April 2020. We remember our disappeared champions – Circuit Breaker, Care Leh-Dee, Dr Disinfector, Fake News Buster and the (drumroll please) MAWA Man (Must always walk alone, the very antithesis of Liverpool fans). This hobbit hopes that they have NS liabilities, so that in the next pandemic or epidemic we can serve the SAF100 on them to return.

Pivot to F&B Sector. The KTV cluster in 2021 was a result of several KTVs that have “pivoted” to the F&B sector (with assistance and sometimes even grants from the relevant  authorities). A good and well-meaning idea in itself except that these newly pivoted F&B outlets did not have any commercial kitchens. So obviously they had to cook up something else on these premises which resulted in the cluster.

Strangers Sharing Same Hotel Room during Quarantine. At the start of the Omicron wave around December 2021, some folks were made to quarantine in the same hotel room with complete strangers. Naturally, this nutty idea was quickly panned by many. Between a full-height walled cubicle in Singapore Expo and sleeping with a stranger in the same hotel room for about 7 to 10 days, most folks will prefer the former. C’mon, even in an SAF exercise, I have my personal basha tent. This hobbit thinks the guy who came up with this probably liked Frank Sinatra’s “Strangers in the Night” a little too much.

CB and Tightened CB. Kudos to the wordsmiths who were always on top of the word game during the pandemic. These include calling a lockdown a circuit breaker or CB in short. This evolved to a Tightened CB later on. And at about the same time, the government was putting out Chinese-dialect short videos to get the message out to the elderly in the Chinese community. Whoever came up with the tightened CB bit should also be sent for some dialect classes.

Die Another Day. This incident arose also in late 2021 when a MOH Director said mortuary directors could handle dead bodies when the cause of death was Covid-19. This was refuted by the Secretary of the Association of Funeral Directors’ Singapore the next day in The Straits Times Forum which stated clearly that MOH guidelines prohibited them from handling such bodies outside of hospitals. This is clearly NOT a case of Everything Everywhere All At Once as the left hand didn’t know what was happening with the right hand. It is also nice to know the Association was given a President’s Certificate of Commendation for exceptional effort and significant contribution to fighting Covid-19. Incidentally, organisations such as SMA, CFPS, AMS, SNA, SDA and PSS weren’t. Obviously someone either forgot about or doesn’t like these guys?

Let us now get down to the White Paper proper and move back into the serious stuff. What really hit home for this hobbit. The White Paper really had their finger on the pulse when it stated on Page 67:

“However, some of the (i.e. SMM) measures were overly elaborate, difficult to operationalise and explain, and therefore confused the public. Re-opening the economy in phases while limiting the spread of community infections turned out to be a more complicated, and emotionally affecting, journey than expected. All this highlights the need for us to exercise greater flexibility in a crisis, go for broader brush but more implementable measures, and to guard against the instinct to aim for unrealistic standards of perfection”.

On Page 74, the White Paper essentially put out the same message again:

“With future pandemics, we will also need to exercise more flexibility. During COVID-19, at times we allowed the perfect to be the enemy of the good, for example the over-calibration of some SMMs and treatment protocols. In striking the right balance between achieving precision and ease of implementation in our public health protocols, we should guard against leaning too much in the direction of the former”.

Very important points that were most eloquently articulated. Beyond these wise words, this hobbit would like to draw attention to this graphic that was put out in late 2021 by Lianhe Zaobao which told vividly how wrong can matters get:

Like what this hobbit has said before, you don’t have to know Chinese to appreciate the ludicrous complexity the “system” had become before thankfully someone decided to implement Protocols 1, 2 and 3.

It is perhaps importantly to go one-step further to discuss why the “system” went off the cliff in terms of complexity and impossibility (rather than ease) of implementation, especially in the area of public health and healthcare.

First, let us remember, whether we like it or not, that protocols, circulars, instructions, directives etc, are written and put in place by people (i.e. real humans, not halflings, elves and orcs). And what drove these people to do what they did? This hobbit can proffer several possibilities:

  • The people who wrote these protocols really have no real on-the-ground experience running healthcare facilities such as hospitals, nursing homes or clinics. They probably grew up in a nice white building; from sitting behind a desk to sitting in a cubicle, before finally being holed up in an office and adorned with a personal assistant to show they have arrived. Hence, just armed with a little theoretical knowledge and no frontline experience, they write protocols the way novelists write fantasy stories.
  • These people are more afraid of losing their jobs more than solving real-life problems, and think that the best way to keep their jobs is to cover their backsides and to write protocols and directives that cover every possibility and exception without thinking how the people on the ground will cope. Never mind you cannot possibly comply with what they wrote. That’s your problem, not these people’s.
  • They are just plain stupid (which is unlikely, since they can write such complicated protocols. Maybe they have spectrum disorder, but they are probably high-functioning ones rather than stupid).
  • Various combinations and permutations arising from the above three possibilities.

There are of course other possibilities, but it would be impossible to explore all of them in the interests of time and readers’ attention. Of course, this hobbit is NOT about to excoriate old wounds, start a new round of fault-finding or try to settle old accounts. But it is important to state that these people have written and issued protocols and directives that have caused untold grief and profound degradation of morale among front-line healthcare workers during the pandemic. This hobbit thinks the morale hasn’t quite recovered fully even now. Quite a few people are still scarred and angry.

So, in the name of all that is good and true, this hobbit beseeches those that are in the high places of power that they do not assign very important tasks such as writing of protocols and directives to these same dangerous people again. Put them somewhere else where they can still earn a living off taxpayers’ money but do less harm, like dress them up as MAWA Man, Care-leh-dee and Dr Disinfector etc and send them to Cosplay conventions. Better still, we can put them onto a Chingay Parade float that has a big overhead banner which has the words “CBs”.

Drug Whitelist and Pricing

According to some folks, in a “perfect world”, doctors prescribe and pharmacists dispense. Doctors earn only from consultation and pharmacists make a living from drug mark-ups, whether from sales or dispensing. Unfortunately, the world is not perfect. Our colonial masters saw it fit to let doctors and medical clinics dispense medicine to their patients, which actually ran counter to what was happening in the United Kingdom when we were still a colony.

And since then, doctors made a living out of both consultation and the dispensing of drugs here. I stress, it is dispensing and not sales, since we are not allowed to “sell” medicines to persons who were not our patients and only allowed to dispense medicine to persons with whom we have a doctor-patient relationship. And this even applies to Over-The-Counter (OTC) drugs.

Despite the fact that doctors are allowed to dispense medicines and derive some profit from it, it is not a carte blanche. There is always competition from pharmacies and patients have a choice. Patients can always decide to take a prescription from a doctor and get it filled at the pharmacy, especially if the price of the dispensed drug is higher than the pharmacy price. This is already happening as many Singaporeans get their chronic medication prescriptions filled across the border in Malaysia, where medicines are cheaper due to territorial pricing practiced by many pharmaceutical companies.

And before the Competition Commission of Singapore in their infinite wisdom decided to outlaw the SMA’s Guideline of Fees, the SMA actually put out guidelines on how to mark-up medicine prices. The Hobbit has reproduced these withdrawn Guideline on Medicine Fee which was issued in 1998 in the second section of this post (which in turn was reproduced in the June 2001 issue of the SMA News that is available on the SMA website).

But the hard truth remains:- GPs in the private sector have never been able to make a living just from consultation fees alone, and their earnings are significantly augmented by dispensing activities.

So the recent informal discussions between the bureaucrats and various GP leaders and PCNs (Primary Care Networks) have resulted in a lot of angst and unhappiness. The main point of contention is the (draft) Drug Whitelist and the price-caps for each drug in the Whitelist. Those GPs who have seen this list have largely come to the conclusion that if they followed the price-caps, it would result in a very significant loss of earnings for them. The counter-argument is that the loss of dispensing earnings would be offset by various payouts from MOH for managing what are called these “chronic enrollees” appropriately.

Most GPs unfortunately remain unconvinced by this counter-argument. From the GP’s perspective, the reasons for the scepticism are at least three-fold:

  • A bird in the hand is worth two in the bush. The GPs are now earning decent margins from dispensing activities, while participating in the treatment of chronic enrollees will definitely lead to an erosion of margins and loss in earnings. The GP has got to earn more money from MOH payouts from other Healthier SG activities to address this loss in earnings. To qualify for these payouts that range from $130 to $180 a year for each chronic enrollee, several milestones have to be reached. These are reasonable milestones from a clinical standpoint, but the reaching of these milestones require the full cooperation of the patient. And as any experienced GP will tell you, patients may not cooperate with you fully for a host of reasons best known to the patient. There is therefore much uncertainty in this.
  • There is no guarantee from any other party as to the number of new enrollees each GP will get. Participation is strictly voluntary for the patient. MOH or the clusters will not forcibly assign any new patients to any GP. In the worst-case scenario, a GP may get no new patients and his existing patients are converted into Heathier SG chronic enrollees and hence subjected to strict price-caps when whitelisted drugs are used. In effect, a GP is subjected to unilaterally offering price guarantees without a corresponding guarantee of any significant increase in business volume from other parties. (Unfortunately, repeated expressions of “don’t worry” do not amount to a business guarantee in real life)
  • The GPs think they know their business better than anyone else and therefore they think they are right. (The counter-argument suggests that the bureaucrats think they know the GP’s business better). And what is worse, should the GP be right, no one will compensate them for the loss in earnings. In other words, they bear most, if not all of the business risk of this grand endeavour.

In conclusion, to the GP, the price-caps of whitelisted drugs, as it stands now, represents a very high-risk venture with probably a limited potential upside.

My Chinese teacher once said this to my class – people may risk their lives to take part in very lucrative but illegal businesses (like drug-trafficking), but no one will take part in businesses that will in all probability lose money.

As the current design of the whitelist stands, the patient stands to benefit a lot while MOH meets all its KPIs and strategic goals. Unfortunately, it appears that one rather important aspect has been not taken into adequate consideration, which is how the GPs benefit from this.

Because we GPs are simple folks thinking simple strokes), it’s rather simple to see what is important to the GP, (assuming quality healthcare is given to their existing patients already):

  1. Do you give me assured business leading to increase business volume and revenue?
  2. Do you increase my earnings?
  3. Does participating in your scheme cost me much (Not just money, but in terms of time and effort as well)?
  4. How much business risk do I bear in this endeavour?
  5. Do I keep my business and professional autonomy?

Of course, we don’t expect all of these above considerations to be in our favour and there is a lot of give and take. For example, if you guarantee me extra business at no business risk, I don’t mind sacrificing some of my autonomy and even investing a bit here and there to upgrade my practice, say, on the IT side.

But if I cannot be assured of an increase in earnings and yet have to put in a lot of effort, such as keeping two sets of stocks and dispensing records as well as financial accounts for Healthier SG and non-Healthier SG patients for the same whitelisted drug, (as is what is being proposed now), then it is quite likely that I will decline to participate. Especially when I am stuck in my 680 square-foot HDB shophouse practice and I really, really have no space or manpower for this kind of fancy logistic and accounts management. (This hobbit has this strong suspicion that whoever came up with this has never been to a HDB estate to see a GP in his/her life and this person should be sent to Tengah New Town to oversee a setting up of a GP practice as part of his private sector and/or community engagement posting).

Therefore, I would rather keep my bird in my hand than to go for the two in the bush. As it is, my bird is a rather small one already, (compared to my specialist colleagues), I cannot afford to lose this one little bird while hoping to find others in the bush. In other words, I am very risk-adverse.

Finally, there is a saying by Lao-tzu (attributed as the founder of Taoist philosophy) that goes like this, “If the water is too clear, there is no fish”. Perhaps the water is indeed too clear with the Drug Whitelist and price-caps, and the fish are unwilling to come out and be seen.

Indeed, if you compare the price-caps, allowed percentage markups and margins of the Drug Whitelist with the withdrawn 1998 SMA Guideline on Medicine Fee, you will realise in many cases, the 1998 Guideline offered a better deal for even the very low-cost medicines then than what is allowed 25 years later, for the GPs treating chronic-tier enrollees. And it bears remembering that in the nineties, my bowl of mee pok only cost $2 in Houseman Canteen, SGH.

SMA Guideline on Medicine Fee (Issued in 1998, Withdrawn in 2007)

a) The price of medicine to the patient should be comparable to what he would have to pay, if he were to choose the prescription at a pharmacy instead.

b) Prices comparable to those charged at a pharmacy are an acceptable upper limit. When this is not known, the following are some suggested acceptable alternatives:

  1. When the price of the medicine is listed in a drug index such as DIMS, the list price of the single-user pack size can be used.
  2. When the above is not available, the list price quoted by the manufacturer or the distributor can be used. When this list price is not available, up to 1.25 times the nett price for the single-user pack size is acceptable.
  3. Where neither the list nor nett prices of the single-user pack size is available (e.g. bulk-packed medicine). Up to twice the per-unit cost of bulk-packed medicine is acceptable.
  4. For very low-cost medicine, a rounding up to 10 cents per tablet/capsule, $1.50 per 5g of cream, or $1.50 per 30ml of mixture, is acceptable. Alternatively, a rounded-up charge of $2 per each medicine dispensed for up to a week, is acceptable.

c) The patient retains the right to choose whether to fill the prescription in the clinic, or externally at a pharmacy.

2023 Hobbit Awards

This Hobbit is appreciative of how the government has recognised folks and organisations that have contributed to the battle against the Covid-19 Pandemic by giving out Covid-19 National Awards. But it is important to not just recognise these worthy people and organisations but also to recognise those that were not given. So we start off this year’s Hobbit Awards by giving out

The Covid non-Award Award (Category A)

This award goes out all the Permanent Secretaries in government. Other than the Permanent Secretary for Home Affairs and Chairman of the Homefront Crisis Executive Group (same person), none of the other Perm Secs were given any Covid-19 National Award by the government. This hobbit speculates that this glaring omission could only be so because all of them declined to receive any award and only put up the person chairing this powerful Group to receive the award on behalf of all of the others. If so, nice move. I like.

The Covid non-Award Award (Category B)

The President’s Certificate of Commendation is a new award category. It is given to “organisations and teams that made exceptional efforts which had a significant impact in Singapore’s fight against COVID-19”.

481 certificates were given out and this hobbit has no doubt that all of them deserve the award. These include not just teams and departments in the public sector but private companies and NGOs as well. Some recipients include the College of General Dental Practitioners, the General Insurance Association (GIA), the Life Insurance Association (LIA), The Association of Banks in Singapore (ABS), The Association of Funeral Directors Singapore (AFD) and The Law Society.

Interestingly, none of the major healthcare professional associations such as the SMA, Singapore Dental Association (SDA), Pharmaceutical Society Singapore (PSS), The College of Family Physicians Singapore (CFPS), Academy of Medicine Singapore (AMS) and Singapore Nursing Association (SNA) received the President’s Certificate.

To all these big healthcare-related professional organisations that didn’t receive this prestigious President’s Certificate, never mind lah, this hobbit gives you the not-so-prestigious but very sincere “The Covid non-Award Award (Category B)”

Now, we move on to other awards for 2023

Community Destruction Award

There is a certain private hospital that has either closed or is in the process of closing down the fruit shop, retail pharmacy, doctors’ tea room and a busy branch of a bank located on its premises. This hobbit hopes the management of this hospital knows that when you run a large hospital, you are actually managing a community and fostering its community spirit, and you are not just operating a facility. A community is made up of people. A facility is just brick and mortar.

Once Bitten Twice Shy Award

On 29 Nov 22, Senior Minister of State Dr Koh Poh Koon rejected a proposal by the General Insurance Association (GIA) to “tweaking existing insurance products” to cover gig workers such as ride hailing and on-demand delivery workers as this would lead to higher costs for the platform companies that hire them. (Business Times, 29 Nov 22 : General insurers’ proposals for gig workers not viable or cost-effective: Koh Poh Koon).

More importantly, it was reported in this article that he said, ““GIA’s suggestion of using only existing prolonged medical leave insurance or group personal accident insurance in place of Wica would relegate this to a private insurance policy whose terms and conditions are dictated by the insurer, without a clear mechanism to adjudicate disputes,” he said. “I appreciate why insurers would want more flexibility in how they compensate claims but to ensure fairness to workers and companies, I do not think we should be leaving it to insurers to be the final arbiter of any disputes to work injury claims,” he added, citing possible conflicts of interest.
Dr Koh said the committee also engaged platform workers, who described having to “jump through hoops” to make claims, even giving up on doing so due to the onerous process””

Sounds familiar? His words can also be an accurate description for many cases involving Integrated Shield Plans now, where a platform supposed put in place to handle disputes are voluntary and IP providers can refuse to take part in them. In this hobbit’s opinion, when you can refuse to participate, you are effectively the “final arbiter”, even if a process exists.

Obviously Dr Koh has learnt a few things during his stint in MOH and has now applied them with great clarity in MOM. Bravo. He gets our Once Bitten Twice Shy Award hands-down.

Incidentally and as aforesaid, the GIA received the prestigious President’s Certificate of Commendation (Covid-19) just a few days ago.

Great Singapore Sale Award

The Annual Great Singapore Sale has been in the doldrums for a long time, worsened by the impact of the pandemic. Well, this year’s Sale promises to be briskier and earlier, with relatives and friends of Mainland Chinese buying paracetamol and other flu medicines by the cartloads in Singapore and shipping them back to the Mainland. This hobbit finds it strange that China is supposed to be the Factory of the World, yet they cannot produce enough paracetamol and distribute them accordingly within China?

Most Unwelcome Sequel Award

As Covid-19 Omicron and its variants reap their way through way through China like a ravenous sickle, one cannot but fear that new variants will be created. Just as it happened with Delta in India and Omicron in South Africa. Can China, with its 1.4B population avoid this fate? Will the current China wave prove to be the most unwelcome sequel to Delta and Omicron?

Best Evidence Award

According to Johns Hopkins University statistics, the number of Covid-19 deaths is about 11,800+ deaths in HK so far, arising from a base of 2.6M cases. Most of the deaths occurred during February and April of 2022, peaking on 11 March when 294 deaths occurred in a single day. In Singapore, there have been about 1700+ deaths from a base of 2.2M cases, with deaths a day peaking at 22.

HK’s population is about 37% larger than Singapore’s (7.4M vs 5.4M). Using Singapore Covid-death numbers as a base (1700), it can be extrapolated that HK’s death numbers could have been around 2400 (1.4 x 1700). Instead there are 11,800 deaths or 9400 “excess deaths” when compared to Singapore. These deaths can be largely attributed to a lower vaccination rate among the elderly and a sizeable population receiving less effective vaccines.

These are the numbers that any anti-vaxxers have to satisfy themselves with intellectual honesty that vaccination is bad for people, especially for the elderly before continuing with their counter-truth messages.

Mental Sclerosis Award

There is a nursing shortage worldwide. This country has lost and is still losing nurses, especially foreign ones to other countries that offer superior terms. Either we shape up and rethink how we can keep our experienced foreign nurses or we will have to suffer this continual drain until some crisis occurs (if it hasn’t occurred already). Superior terms do not just include a bigger pay package or more allowances. Superior terms include non-monetary terms, e.g. the ability to bring their family, especially kids along with them to Singapore and to give them access to subsidised education and healthcare.

Also, you really can’t replace a nurse with 5 to 10 years of working experience in our hospitals with a fresh recruit. It takes several years before a foreign nurse understands our working environment and attains a high degree of local-context proficiency. So this explanation that we can address the situation by recruiting 1000 nurses from overseas to replace the 1000 we lost recently doesn’t quite cut it with operators on the ground who know better.

Of course there will be people who will argue that we cannot give these foreign nurses superior terms that are different from workers drawing the roughly the same salaries but working in other sectors and jobs.

To these people, this hobbit confers the Mental Sclerosis Award. Hopefully these folks will never be admitted to a hospital in their entire life and then know what it is to be a patient in an environment that is short of experienced nursing manpower.

Ugly Neighbour Award

Remember how many people criticized the government for not imposing test requirements, restrictions and bans on flights originating from India early enough in the first half of 2021 as the Delta variant (which was first discovered in India) swept through the globe?

Well, obviously India has learnt something from what Singapore did then – it has now very swiftly (on 29 Dec 22) imposed a mandatory negative Covid-19 test result requirement from just 6 places – China, Japan, Hong Kong, Thailand, South Korea and Singapore. This is to address the large number of cases that are popping up now with the current Covid-19 sweeping through China.

When this old coot of a hobbit was growing up decades ago, this conversation wasn’t quite uncommon or unexpected –

The hobbit, “Hi, I am hobbit from Singapore”,
Reply from American, “Oh, that’s a nice place in China!”

Maybe the Indian authorities today still think likewise.

Coming of Age Award

A generation of doctors was baptised with blood, toil, tears and sweat during the SARS Outbreak of 2003. Another generation of young doctors have since been tested with something far more persistent, pervasive and pernicious than SARS. Their scars may not completely heal even with time and the loss of years and innocence cannot be retrieved. But they continue to stand proud and tall. Going forward, this hobbit has no doubt that they will be more than capable of taking up the mantle of the medical profession from their seniors. They have come of age amid The Pestilence Of This Age.

Singaporean Efficiency

On 17 Nov 22, while referring to the NHS (National Health Service), the British Chancellor of the Exchequer (a fancy UK name for Finance Minister) Jeremy Hunt, said in the House of Commons (a fancy name for Lower House of Parliament), “We want Scandinavian quality alongside Singaporean efficiency, both better outcomes for citizens and better value for taxpayers.”…(Ref:

Coming from our colonial masters, that’s quite an endorsement of what we do now. It wasn’t so long ago that they started a medical school in Singapore called the King Edward VII (KEVII) College of Medicine, which only conferred a qualification called the Licentiate of Medicine and Surgery (LMS) to the natives (i.e. us). Those armed with an LMS could practise as “Assistant Physicians”, to the physicians (i.e. the Europeans/colonial masters) but could never apply to take exams that led to one being recognised as proper specialists, such as MRCP and FRCS. The highest degrees they could attain were the LRCP and MRCS, which were not recognised as specialist qualifications. In other words, a hard ceiling was put in place for natives holding a LMS in that they could never specialise. It was only a few years after World War 2 ended that the College started conferring MBBS.

By the way, the LMS remains a recognised qualification under the Medical Registration Act and one can practise in Singapore with just an LMS issued by the KEVII College of Medicine. This hobbit just wonders if there are still any doctors alive today with LMS.

Enough of history. What is efficiency? At the heart of it, efficiency implies a healthy ratio between input and output. An efficient system means one comparatively puts in few inputs of resources (time, people, money etc) and gets a lot of output. In healthcare, the concept of efficiency has evolved to outcomes as well. In layman terms, efficiency can be simplistically described as getting a bigger bang for the buck.

But seriously, are we as efficient as Mr Hunt thinks? This Hobbit has serious doubts. And even if we are efficient now, it is obvious that this efficiency is declining. If it were not, our MOH budget would not be growing quite so fast and the growth trajectory has been described as “unsustainable” by Finance Minister Lawrence Wong in his Budget Speech this year.

For the current financial year, MOH has been allocated the largest budget of all ministries, surpassing that of even MINDEF and MOE. True, there are a few billions in there budgeted for Covid-19, but even if we strip that out, MOH probably still has the second largest budget in government today.

With this large and fast-growing input of money, are we getting a lot more output and more importantly, more and better outcomes? It is probably the realisation that we are not that has led MOH to implement Healthier SG.

But will  Healthier SG improve the efficiency of the healthcare system by placing emphasis on preventive medicine and the family physician? The simple answer is “yes”. But the improvements will be limited because there are other powerful forces at play that drag down efficiency.

First, there is the Americanization of Singapore healthcare that has taken place in the last 15 years or so. America has probably the most inefficient healthcare system in the world, spending a whopping 18% of GDP on healthcare while its population has health outcomes that are inferior to many first world countries. When we unthinkingly introduced stuff like ACGME-I Residency and JCI into our healthcare system, we are really aping a country that spends 18% of GDP when we only spend about 5% GDP on healthcare.

One ENT surgeon recently remarked “Latest example of how JCI increases costs – we have been rolling our own shoulder roll in OT for decades. Last week, a young American JCI surveyor came and said “Oh, this does not meet the required standard and will not pass safety and infection control guidelines. You should buy proper shoulder rolls and replace them regularly”. Are we supposed to follow her advice? Why should we?? Thanks for contributing to escalating healthcare costs. Let’s become USA”.

Let’s also look at the ACGME-I Residency that some geniuses decreed must be implemented some years ago. Has that led to better specialists being produced? If so, then how come most private hospitals have now put in place a requirement that a specialist must have spent at least 5 years in a restructured hospital as a specialist, of which 3 must have been as consultant, before he or she is given admission rights in the private hospital? In other words, a specialist must now have spent at least 2 years as Associate Consultant and 3 as Consultant before this specialist is given practising rights. This is the market recognising that despite putting in more resources to implement American-style residency, the product is not of the same quality of yesteryear.  The American Residency system may appear to be more efficient superficially by cutting down the number of years needed to produce a state-registered specialist, but it is not.

Moving on from Americanisation, we come to the more difficult issue of culture and risk management. The system cannot get more efficient when tasks that were previously done by junior staff are now pushed to the more senior staff. This is only logical because a senior staff costs more than a junior staff. Old coots like us have gone through the times when a 3rd year registrar can perform a gastrectomy by himself. Now I am not so sure if a “more senior” 2nd year Associate Consultant can do that. Gone are the days when a Medical Officer can perform an appendicectomy unsupervised. Of course, detractors will say, well, times have changed and the public now demand better care etc. Maybe. Let’s take a simpler example then. Many years ago, a house officer can sign a death certificate, but now only a medical officer can. Yes, there are legal implications of certifying death. But seriously, other than medico-legal implications, how harmful can that be? It is about filling a form correctly and after all, the patient has passed on. And since house officers only practise in hospitals, the unsure house officer can always consult someone more senior when certifying death.

It is all about the underlying culture of risk. Today, the risk appetite is much lower than in the past, even for honest mistakes. And the solution is always to escalate the work upwards to address this. In the world of bureaucracy, there is this concept of “title inflation” where affairs that were handled by a junior staff were now handled by a person with a bigger title (and more expensive). So in effect, the job responsibilities of say, a “Director” today were similar to that of an “Assistant Director” 15 years ago. This will also invariably lead to the appointment of many more “Directors” and higher costs. The same concept can also be applied to our public hospitals. This hobbit is told that this does not only happen to the medical profession but to nursing and allied health professions too. What was done by a healthcare attendant (aka “Amah”) is now done by an enrolled nurse, and what was previously done by an enrolled nurse often has to be done by a staff nurse now and so on.

Have our junior professionals become stupider over the years? Of course not! They are better trained, better qualified and better paid, yet the work keeps escalating upwards. Is it the fault of these younger people? This hobbit thinks not. This phenomenon is a systematic and reflex response that takes place in a culture that is intolerant of any mistake.

When a mistake is made, in order to pre-empt similar mistakes from occurring, the usual and reflex solution is – get the more senior person to do it instead. This leads to increasing costs (and decreasing efficiency) and less job satisfaction and poorer training for the junior staff. And worse, often, all this is done in the name of “patient safety”. When “patient safety” is mentioned, many administrators go into brain freeze and go for the “escalate upwards” option.

This does not mean that we want to mindlessly pile more and more work on junior staff so as to ruthlessly raise the efficiency of the system. Rather we should be looking at giving back the meaningful stuff that junior staff used to do years ago to today’s junior staff and removing the work that is of low value. To do this, there must be a culture of accepting honest mistakes made by junior staff. It starts from the very top and then it cascades down. The “system” must provide political cover to the hospitals, and in turn, the hospital management must provide cover for the clinical departments etc so that a healthier culture can be inculcated down the line.

A risk-free environment seems laudable, but it comes at tremendous cost. This is a difficult thing to say, but there needs to be an acceptable trade-off between risk and cost if we are to run an efficient healthcare system.

If we are unable to accept any trade-off, then the hard truth is efficiency of our healthcare system will continue to decline even though we put in more and more inputs of manpower, time and money.

September Stew

You have barely settled into watching Amazon’s Rings of Power before you realise you are now threatened by that one Power that is more all-consuming than even the One Ring. Indeed, there is that One Ring to rule them all, but there is also that One Power that can drive sound-minded people to become teeth-clattering, nerve-wrecked, fingernails-chewing idiots.

No, we are not talking about the crippling effects of high inflation.

Yes, we are talking about PSLE.

But better days await because there is that most important post-PSLE question that needs to be answered very soon, “where are you going for the year-end holidays?” Are Singaporeans going to conquer Japan (or at least Shinjuku) in a tit for tat for what they did to us 80 years ago in 1942? Except that instead of shouting “Banzai”, Singaporeans will scream “Cheap” and then splash the cash from Sapporo to Kagoshima. At current exchange rates, we can have two bowls of ramen with full spread of toppings in Tokyo for the price of that one bowl in Singapore that is accompanied by a sliver of an apology for chashu. In case you haven’t noticed, Singapore is the most expensive place in the world for Japanese cuisine. It’s another world-first for the little Red Dot

IP Premium Freeze

While we are talking about inflation and the rising costs of living, this hobbit has some good news. In the last post, this hobbit noted that on 15 Aug 22, it was reported in the Business Times that “Strong profits for most insurers’ Integrated Shield portfolios, but brace for premium hikes”. In that same report, it was announced that 5 out of 7 will raise Integrated Shield Plans (IP) premiums this coming year. These raises were made in the name of keeping the IP sector “sustainable”, despite making good profits in 2021 and 2020.

Well, well, it appears that in Singapore, pigs can indeed fly. On 2 Sep 22, the Life Insurance Association of Singapore (LIA) announced that IP insurers were freezing IP premiums for about a two-year period – 2 Sep 22 to 31 Aug 24.

Wow, what happened? Did the IP insurers stumble on some Ring of Benevolence or Cloak of Kindness to offer this two-year reprieve? This hobbit is stunned like vegetable.

This hobbit thinks it’s probably some ogre-sized fella sat on these soulless and faceless IP people and forced them to regurgitate some of the profits from 2020 and 2021. Its either that or some fire-breathing dragon finally woke up and breathed on these IP folks.

Whoever you are, Mr Ogre-size Fella(s) or Fire-breathing Dragon(s), this hobbit thanks you.

Widespread IT system outage x 2

Unless you are completely delinked from public sector healthcare, you would have experienced the deleterious effects, or at least heard, of the IT system outages that occurred recently. This happened not just once, but twice, on 25 Aug and 5 Sep 22. These two events were attributed to “node failures”, which in turn were caused by bugs in the firmware of devices supplied by a company called Cisco (not the local security services company). It was reported in the Straits Times on 12 Sep 22 that these “devices have been patched”. This information was revealed in response to parliamentary questions.

It was also reported in the answer given to these questions that in the IT arm of MOH Holdings, called Integrated Health Information Systems (IHIS), which supports the IT needs and operations of public sector healthcare institutions, has a headcount of ~3500. I must say, this is quite a staggering number and this hobbit is stunned like vegetable, again. Some smaller general hospitals may not even have a headcount of 3500. This hobbit wonders how many headcounts does GovTech, the agency that supports the rest of government, has? More or less than 3500?

Anyway, beyond headcounts, what is important is that IT availability nowadays is almost as important as utility-availability in the traditional sense. If there was a power outage or if the water taps ran dry for just a few hours on almost a nationwide scale, you can be sure that the authorities will be tasked to investigate thoroughly what happened and to make recommendations as to what steps can be taken to prevent the recurrence of such events. With our heavy reliance on IT to deliver healthcare today, IT availability is no less important than power or water availability.

For example, life-sustaining critical equipment such as ventilators are plugged into Uninterrupted Power System (UPS) power sockets. The batteries for these UPS systems are maintained and replaced fastidiously and they will kick in when there is a power outage.

As a second line defence, backup power generators are tested regularly in hospitals to ensure they are always ready in case of a power blackout. Even water supply grids have redundancy built-in for some general hospitals.

So do we have the same level of resilience built into our IT systems supporting our public healthcare institutions?

Pre-employment Grants for Singaporeans Studying Medicine Overseas

Currently, Singaporeans studying Medicine overseas in recognised universities can apply for a MOH Pre-Employment Grant (PEG) to partially fund their studies. In return, they are bonded to serve the government for up to 4 years, depending on the number of years the grant was given to the student. The grant is given on merit. But it is not known publicly as to what are the exact meritocratic criteria involved here. This grant is very popular and has brought back many a Singaporean doctor to our shores over the years to work as a house or medical officer. This hobbit may be wrong, but anecdotal evidence suggests that slightly less than half of Singaporean medical students are successful in getting this grant.

It is said that folks who don’t get this grant often end up seeking employment and training overseas and there is a higher risk that they will never come back.

On the other hand, recently, on the MOH Holding website, there was an announcement that it was conducting a Request for Proposal (RFP) for the Appointment of a Recruitment Agency to Provide Services for the Recruitment of Doctors in India (announced 6 Sep). This was followed up by another RFP 10 days later for Request for Proposal (RFP) for the appointment of recruitment agencies to provide overseas recruitment services to MOHH and its Affiliate(s) for a period of two years with an option to extend for another one year.(

The earlier RFP was for the recruitment of 60 Medical Officers from India from 2022 to 2024 with an option also to extend for another year, while the later RFP was for recruitment of nurses, enrolled nurses, nursing aides and healthcare assistants

Let’s just focus on the doctors bit for a while. If we are so short of medical officers and we have to appoint agencies to help us recruit them from overseas, wouldn’t it be easier if we just awarded more PEGs? It is estimated that annually we produce about 500 doctors locally and another 200 Singaporeans go abroad to study medicine. Wouldn’t this shortage of 60 medical officers be easily plugged by giving out more PEGs? It would be nice if we knew, excluding those that don’t bother to apply for the PEG, how many unsuccessful PEG applicants there are roughly in a year so that stakeholders can take this discussion further. It would be very useful if stakeholders also knew, of the unsuccessful PEG applicants, how many indeed remained overseas for their HO and MO employment and training.

Integrated Shield Plans Premiums: Heads You Win, Tails I Lose

On 15 Aug 22, The Business Times reported on the financial performance of insurers providing Integrated Shield Plans (IP) for 2021 – “Strong profits for most insurers’ Integrated Shield portfolios, but brace for premium hikes”.

This opening paragraph highlights the situation facing policyholders this coming year: “Despite markedly stronger underwriting results in 2021, most insurers with Integrated Shield (IP) plans will raise premiums this year, mostly for private-hospital base plans and riders”. The article goes on to state that 5 out of the 7 IP insurers will raise premiums this year.

The article contained a table of the IP insurers underwriting results from 2016 to 2021 (6 years). There are a total of 7 IP insurers, with Raffles Health being the smallest and latest provider. It started operations in 2018 and only posted full-year underwriting results from 2019. It has reported small losses for 2019 to 2021 (<$3M each year). In any case, Raffles is an “integrated healthcare group”, which means that its policyholders usually obtain healthcare services from Raffles Medical Group. It can probably afford to sustain small losses in its insurance arm while it makes money from the healthcare provider arm to balance the books. So let’s ignore Raffles Medical Group for now in our discussion.

Of the remaining 6 IP insurers, here are the results:

YearNumber of loss-making IP insurers (out of 6)

Total underwriting profit was about S$170M for 2021. Singlife with Aviva made money for the first time in 6 years and said that its profit of $32.71M could be once-off (compared to only $680K for 2020) due to a “one-off release in reserves that was kept to cater for Covid-related costs”. Let us remove the effect of this one-off surplus of $32M from Singlife with Aviva and the total underwriting profit for the 6 IP insurers would still be in the region of $138M. In 2020, these 6 IP insurers’ combined nett underwriting profit was about $107M. From 2016 to 2019, collectively, the 6 IP insurers did not make money.

Now, let’s turn back the clock a little to the time when times were bad, when most of the insurers lost money. Then, the insurers said that the IP industry was unsustainable and argued for lower reimbursement rates for healthcare providers, especially the doctors. This led to the formation of the Health Insurance Task Force (HITF) and the subsequent introduction of the MOH Fee Benchmarks and Preferred Provider Panels in an attempt to lower costs.

In an about face, the IP insurers (other than Income) did not respect the full range of the MOH Fee Benchmarks because it said doing so will lead to higher premiums for policyholders. Some IP insurers also said that having more inclusive panels (i.e. more specialists) would also lead to higher premiums as well. In other words, it was signalling to policy-makers that any move along these two directions would inevitably lead to policyholders suffering financially. And with almost 70% of Singaporeans being a IP policyholder, this was a powerful signal indeed. Till now, most of the IP providers do NOT reimburse to the higher limit of the MOH Fee Benchmarks, and Preferred Provider Panels still exist, although they have increased in size.

It is therefore quite jaw-droppingly shocking that with record profits in 2020 and 2021, and with IP providers still not respecting the higher limit of fee benchmarks, IP providers still want to raise premiums this year. And the reason given? The same as when times were bad, to keep the IP sector “sustainable”. The word “sustainable” has become a word for all seasons for IP insurers.

The Business Times article reported “Insurers cite a number of challenges in the quest to keep IPs sustainable (emphasis mine), including an ageing population and rising medical inflation which is significantly higher in private hospitals compared to public or restructured hospitals” and “increased use of newer and costlier treatments have resulted in an increase in both the frequency and severity of claims”.

To sum it up, in bad years, some IP insurers will say they need to raise premiums and cut reimbursements to keep IPs sustainable. In good years, like in the last two years, IP insurers will say they need to raise premiums because of an ageing population and rising medical inflation, so that the IP business is sustainable.

So in other words, they have given reasons to raise premiums in both good and bad years. Isn’t that a case of “heads you win, tails I lose”? Looks like these guys have figured it all out – they will raise premiums under any circumstances to keep things “sustainable”. Brilliant.

This hobbit thinks the main problem with IP is structural – IP is an annual policy. The IP provider probably views the sale of IP policies as an annual affair and no more. Premiums are collected annually and reimbursements are made annually. They will argue that there is no guarantee that a policyholder will renew the policy, which is technically true but practically not so – as often cited, a policyholder with pre-existing conditions cannot switch IP provider yearly. Once there are pre-existing conditions, policyholders are essentially stuck with the same IP provider unless they choose not to have any IP plan at all. So the best strategy for a profit-maximizing IP insurer is to raise premiums as much as possible without losing policyholders. This was pointed out by Dr Jeremy Lim in the aforesaid Business Times article, “Hence, despite improving economics as reflected by the latest numbers, insurers would still want to maintain premium increases to improve their profit margins and also keep policyholders ‘used’ to regular premium increases” and “annual premium increases (should not be) so dramatic that policyholders choose to discontinue”.

As IPs are structured as a yearly insurance contract between the policyholder and insurer, the IP insurers have no incentive or interest in smoothening out business cycles or to share some profits with their policyholders. The IP insurers’ main interest is to maximise premiums and profits every year and thereafter extract maximum commissions and bonuses for the company and for their employees

This is in contrast to say Medishield Life (MSL), which is a not-for-profit scheme and premiums are paid on a life-time basis. For example, there is “front-loading” of premiums when a person is young, healthy and usually having a good income in MSL. MSL policyholders pay more than they consume when they are young and the surplus is then used to fund policyholders’ premium shortfall when they are old and they consume more healthcare but may probably be retired with no or less income.

The question before us now is that with the way the IPs are currently structured, do IPs best serve the healthcare financing needs of Singapore going forward? In the name of sustainability, we have seen how IP insurers have justified their decision to raise premiums no matter if times are good or bad and if they are loss or profit-making. There is no mechanism to return a bit of the profits to the policyholders when times are good so as to lessen policyholders’ premium burden.

This hobbit thinks the whole business of IP has become a frightening beast that will continue to inexorably grow at the expense of the interests of policyholders and healthcare providers. It has become painfully obvious that if we are to tame this all-devouring IP beast, the whole sector needs to be fundamentally restructured and tightly regulated. The way IP businesses are run now appears to be only sustainable for IP insurers, but not for policyholders or healthcare providers.

Nursing Attrition and Shortage

There has been many reports about the shortage of nurses in Singapore and the increasing attrition rates we have seen lately. Parliamentary questions have been asked and answered. It was reported in The Straits Times (2 Aug 22, Resignation rates of nurses in public hospitals at a five-year high in 2021) that between 2017 to 2020, the attrition rates for local nurses hovered between 5% to 7% and in 2021, the attrition rate rose to 7.4%.

What is more distressing is that attrition rate for foreign nurses rose to a whopping 14.8% in 2021, double than that of local rate. If this keeps up, we can theoretically turnover our total foreign nurse workforce completely in 7 years and the local nursing workforce completely in 14 years.

Another way to look at it is that a local nurse will on the average stay in local nursing for 14 years and a foreign nurse will stay with us in nursing for 7 years. That is not too encouraging. Nursing is a calling and it’s different from say being an air stewardess. Singapore Airlines wants to keep its inflight crew young and fresh and not everyone can be promoted to be an inflight supervisor or leading stewardess. So an average period of employment of say 7 years may be pretty good for an airline.

Nursing, on the other hand, has other imperatives and contexts to consider. For one, it takes at least three years to train a person before one becomes a state-registered nurse (SRN) (i.e. staff nurse). It takes a few more years before a SRN becomes really proficient in what she is supposed to do, and even longer if he or she specialises in certain areas by getting an advanced diploma, e.g. ICU nurse, scrub nurse etc. This is about the time he or she becomes a senior staff nurse (after 4 to 6 years of being an SRN) and her contributions to the organisation and patient care rise significantly beyond that of a “junior”, fresh out-of-school SRN.

Therefore, we really want a nurse to work for at least 20 to 25 years or longer if possible so that the healthcare system can derive maximal benefit from their experience, expertise and productivity. But clearly it is not happening. But I guess if the average local stays for 14 years, it’s still a pretty decent period of time. Many marriages don’t even last that long nowadays. In any case, if a nurse leaves the public sector for the private sector and still works as a nurse, then it is not a complete loss as he or she still contributes to the healthcare system. But we don’t have the data on this and let’s defer comment on this until we have more information.

The situation with foreign nurses looks much more dire if the attrition rate stays at >14%. It is nice to think that if we recruit and retain more local nurses than our dependence on foreign nurses will decline. But with <40,000 births a year on this island and a rapidly ageing population, Singapore needs more foreign nurses now and going forward. Period. It takes time for a foreign nurse to adapt and settle in our working and living environment. Some say this period is anywhere from 3 to 5 years. When the foreign nurse is finally settled in and up to speed, they leave after a year or two. This is a lament that is often heard amongst nursing administrators and doctors.

And then there is the acuity of the current problem. Previously, we could try to recruit nurses at a steady pace when demand and supply were stable. But with the pandemic, we do not have the luxury of time and stability in demand and supply. We need to keep each and every nurse we have today, even as we try to recruit more from overseas or train more locals to be nurses. The analogy is that we have to stop the source of bleeding while we transfuse the patient. No point transfusing when the patient continues to haemorrhage profusely. The haemoglobin ain’t gonna rise.

It is great to see nurses in the public sector getting 1.7 to 2.1 months of retention payment this year. But will this stop or decisively slow the bleeding? Only time will tell. But this hobbit suspects this may not be enough. Typically, a worker looks at compensation and benefits as well as prospects when deciding to stay with a job or an employer. Anecdotal evidence from foreign nurses here suggests that remuneration is not the main reason why they leave for other lands. Basically, the Anglophone world is recruiting nurses aggressively and they know that any nurse that is licensed by SNB (Singapore Nursing Board) is of a high quality and so they are being actively targeted by these English-speaking countries. In other words, Singapore has become the on-the-job training ground of these Asian-origin foreign nurses so that they can eventually work in other countries such as USA, UK, Australia, New Zealand and Canada.

This has been so for many years. I remember there was, outside a public hospital where I worked at, a public bus-stop (a mere few metres from the edge of the hospital compound) which had a large advertisement with the words “Join US Nursing” boldly displayed. Apparently, there was nothing the hospital could do because the bus-stop was located in a public area and whoever owned the bus-stop took the advertising money already.

But what has changed in the last 12 to 18 months is that their recruitment efforts have intensified and their offers have improved. And the 24 months of border closure has deepened the pain of separation from family members and the loneliness of living alone in Singapore.

Most of the countries mentioned above offer benefits that cannot be recompensed by more money: – e.g. the ability to bring your family members along and for these family members to enjoy subsidised healthcare and education. So while the money to be made in Singapore is not less than elsewhere (especially given our low tax rates), the peace and happiness that comes with living with your spouse and children cannot be matched by mere dollars and cents. These are employment policies that affect all employers of nurses, both public and private and they cannot be adequately addressed by employers themselves. There needs to be a national relook at how Singapore remains a competitive if not attractive country for foreign nurses to work and live in.

The policy quagmire that detractors may come up with is to ask why should special arrangements or dispensation be given to nurses and not to other skilled workers that Singapore also needs, e.g. IT support staff, construction supervisors and foremen, skilled hospitality workers etc. And then somehow the whole thing gets stuck from here onwards and every mind trying to solve the problem enters a state of deep freeze.

The hard truth is nobody outside of Singapore cares if you have parity in treatment between different skilled workers working in different sectors. We just have to be nimble and competitive so that we get what we need, be they nurses, IT support staff or plumbers. Adopting a one-size fit all approach (no accompanying family members for S-pass holders, regardless of sector) just means we lose experienced nurses to places that are more competitive and compelling.  

Another possible solution is to raise foreign nurses salary to the point that they qualify for employment passes instead of S-passes, so that they can bring in family members as well. But that would mean raising salaries across the board for all nurses, both local and foreign. This hobbit thinks this may be workable but someone better do the math and see if we can afford it.

In other words, there are no easy choices. Singapore has always survived on the belief that nobody owes us a living and we must remain competitive. Well, nobody owes us  foreign nurses either, especially experienced ones. We either do what needs to be done or we don’t get what we want or need. The cheese has moved with the pandemic. What is our response?

Let us now return to the problem of attrition rates for local nurses. The attrition rates may seem less ominous than for foreign nurses, but the problems may be even more deep-seated and cannot be changed by quick and purposeful policy adjustments.  

This hobbit is reminded of a story he heard long ago that happened in Middle-earth in the previous millennium. This tale was told to this hobbit by a dwarven assistant director who happened to be there when the incident happened. The great Non-Temporary Secretary of the Sickness Ministry of the Kingdom of Crimson Speck summoned all his senior staff to sit at the Grand Boardroom Table. This was in the days when The Sickness Ministry was so small that even a deputy or assistant director can somehow find a seat at this Great Table.

The Non-Temporary Secretary asked all who were seated at the table, “Do you have daughters”? Quite a few answered in the affirmative. He then followed up and asked “If I gave you a binary choice; to choose between being a teacher or a nurse, what would you want your daughter(s) to be?” (This was in the last Millennium, when people were less politically correct and more gender-specific)

Sadly, all the wise and august elves, men, dwarves, halflings seated at the Table indicated they would want their daughters to be teachers. Not one said “Nurse”. The Non-Temporary Secretary looked at the ceiling of the Great Boardroom and sighed. He concluded, “If that is the belief of all of us in this room, then how can we even convince others to let their daughters be nurses so that our present nursing shortage in the Sickness Ministry can be addressed”?

Well, the above fictional story may have come from mythological Middle-earth in the last Millennium, but it underscores the point that a society’s worldview may have to be addressed before nursing can be commonly considered to be an attractive career option by young adults and their families.

Who Shall Live (or Die)?

You know this is serious business when we get two letters published side by side on the same day from Ministry of Health on the essentially same subject, no thanks to 400-word limit imposed by The Straits Times Forum. This happened on 18 June 22 (Assistance available for cancer patients who need medications not on new list; Balance needed between allowing liberal use of cancer drugs and affordability).

Basically the problem is “money no enough”. But I think somehow the discussion has veered towards subsidising drugs that are “clinically proven” with “evidence”. The words “clinically proven” appeared twice and “evidence” appeared three times in these two letters. The words “cost-effective” appeared three times as well.

So what is “evidence” and “clinically proven” in the medical world? It’s really based on biostatistics and probability. This hobbit has a confession to make, like many medical students in the past, he skipped or slept through most of the lectures in social medicine and biostatistics and remembers only a few shreds of the stuff, now located in some obscure sulci of the brain that has been in disuse for a long time.

The basic principles of biostats, or rather – inferential statistics, are based on proving or disproving “the null hypothesis” with a probabilistic threshold of 5%, hence the dictum that something is “statistically significant” when p<0.05. This requires really obtaining many values for the same trait under investigation (also known as “response variable”), leading to a distribution of values that are often assumed to have a “normal distribution”.

Hence, this concept of the “power” of a study, which is influenced by the number of subjects under study (i.e. sample size)  – the more subjects, the more values we can get for the same trait under investigation, and we get more power. (Actually there are 4 factors that influence power, but we will just talk about sample size here).

As you can see, this kind of evidence  in clinical depends on studying a group of people. But the idea of precision medicine is predicated on very different premises. Precision or personalised medicine depends on customising treatment or intervention based on a suite of factors that are peculiar to a person, not common to many persons.

If something in precision or personalised person is proven to work well for one person, then that is evidence in itself. To go back to the old framework of submitting lots of “evidence” to show that it works for many people (i.e. “clinically proven”) is just not going to cut it.

Sure, there are lots of people practising stuff close to quackery in the name of precision or personalised medicine, and this should not be allowed at all, much less be covered by subsidies or insurance pay-outs. But to ask for more evidence the old-fashioned way that something works for many people for a given problem is like asking people to buy and use paper road maps on a driving holiday when there are GPS and Google Maps.

But most importantly, to the patient itself, inferential statistics means nothing. To him or her, evidence is when the patient feels better, his cancer marker counts are lower or better still, his tumour is seen shrinking on the CT scan or MRI. To the patient, such “solid” evidence requires a sample size of one – the patient. The idea that someone needs to submit more evidence to show the magical p<0.05 when his cancer markers are dropping and his tumour is shrinking on a CT scan just cuts no ice with the public, or for that matter, to anyone with a modicum of intelligence.

Simply put, the way things are now:  – Just as one man’s meat is another man’s poison, one man’s evidence is another man’s quick death sentence (should the treatment be denied).

And then there is this more difficult concept of cost-effectiveness. Cost effectiveness in reality is a ratio of price and desired outcome. The first step is to define what is the desired outcome. In this case, it may well be period of additional survival attributable to the new treatment. The next and difficult step is to apply a dollar value to this additional period of survival and say well, is this worth it?

Inherent in this is that we are saying that there is a price-tag to each day of additional survival. If the cost of the treatment is below this price, we will pay. If the cost of treatment is more expensive than this price-tag, we won’t. And if the patient cannot afford it, then the patient dies. Hopefully quickly and less painfully.

This reminds me of a classic Health Economics textbook written by a prominent American health economist, Victor Fuchs in 1974, titled,  “Who Shall Live?”. If you are a health economist or policymaker, implicit in asking this question “Who Shall Live?” is also answering the terrible question, “Who Shall Die?” in economic and policy terms.

But both questions have to be answered because resources are limited. If we had unlimited resources, then these questions need not be answered. But we don’t. That’s the sad truth. Perhaps we should learn from doctors from several decades ago when Singapore had very limited resources. For example, in nephrology, Singapore had very few dialysis machines and doctors had to decide who gets dialysed and who doesn’t, and in the process literally gets to decide who shall live or die.

Maybe the authorities can release a transparent standard of $X per day of additional survival and answer the question of who shall live or die, so that drug companies can decide if they want to meet this target or not and get funding or insurance, especially Integrated Shield Plan (IP) coverage.

This is because the current approach is deeply and intellectually unsatisfying, when the decision to approve or deny funding or insurance coverage for a treatment for a patient comes down to

  • Whether a treatment is off-label or on-label (which as this hobbit has said before, what is off or on-label can come down to a rather unscientific basis – like Viagra and pulmonary hypertension)
  • Whether a treatment is supported by evidence based on inferential statistics (i.e. based on statistics derived from a group of people) in the era of personalised and precision medicine

Until we have the gumption to just say, “look, some people are NOT going to get funding or insurance coverage for treatment because we cannot afford it and yes, rich people do live longer because they can pay for better or personalised or precision medicine”, then the deep murmurings of discontent and unhappiness will continue to fester.

In the meantime, perhaps IP providers can consider selling riders that pay for off-label use of medicine and personalised or precision medicine. This will be another opportunity for them to make even more money. This hobbit will pay for such a rider if it is just a couple of hundred dollars a year.

I am sorry if this post seems rather dark and amoral. It’s better to be blunt and amoral than to prance around the altars of evidence and on- or off-label use.