The Quest for Value-Based Insurance

One side of the Coin: Value in Underwriting

A lot of folks are talking about Value Based Healthcare. It’s the in-thing now. Two public health specialists (Drs Jeremy Lim and Jake Goh Jit Khong) joined in the IP debate recently (25 April 24) and wrote in the Straits Times recently that “Ultimately, every stakeholder wants ‘Value’”.

Let’s see if the IP insurers are delivering value. To do that, unfortunately, we have to look at the numbers. This hobbit is not particularly a whiz at numbers but let’s give this a shot. And if the figures given in this post are proven to be very wrong, this hobbit unreservedly apologises in advance.

In Jan 2021, The Singapore Actuarial Society (SAS) produced a paper called “Medishield Life 2020 Review: SAS Comments” based on data between 2016 to 2019. A very illuminative table was produced in that paper which was reproduced by the SMA in its Position Statement which was released in March 2021 : Troubled Integrated Shield Plans. Table 1 is a reproduction of that table in the Position Statement.

Table 1: Combined Profit and Loss of 7 Integrated Shield Plan Insurers 2016 to 2019


Year		Gross PremiumsGross ClaimsManagement ExpensesCommissionChange in Reserves and Other ExpensesUnderwriting Gain/(Loss)
2016$1608m$1190m$106m$131m$279m(98m)
2017$1859m$1390m$126m$160m$329m(146m)
2018$1836m$1399m$140m$182m$153m(38m)
2019$2143m$1617m$166m$197m$206m(43m)
2016-2019$7447m$5596m$538m$670m$967m(325m)
% of Gross Premiums 75%7%9%13%(4%)
% Increase from 2016-201933.3%35.9%56.6%50.4%  
CAGR (Compound Annual Growth Rate10%11%16%15%  

The last two rows are additional observations by SMA. The rest of the table is exactly what was presented by SAS. We can trust that SAS are experts in this field and the figures they presented have not been contested by anyone as being erroneous even though there was some debate as to what conclusions one can draw from these figures.

One of the things that I need to say I am happy with the Monetary Authority of Singapore is that they require insurers to submit data in a form called Form A5. These submitted data is then published online. The link is given at the end of this post 1,.

In any case, this hobbit and his gnome friends have dug deeper into such publicly available sources and mined more recent data.

Table 2: Combined Profit and Loss of 7 Integrated Shield Plan Insurers 2019 to 2022


Year		Gross PremiumsGross ClaimsManagement ExpensesCommissionChange in Reserves and Other ExpensesUnderwriting Gain/(Loss)
2019$2143$1617$166m$197m$206m(43m)
2020$2351$1625$170m$202m$948m(593m)
2021$2451$1807$177m$215m$79m172m
2022$2571$1889$192m$215m$153m123m
2019-2022$9516$6938$705m$829m$1386m(341m)
% of Gross Premiums 73%7%9%15%(4%)
% Increase from 2016-201920%16.8%15.7%9.1%  
CAGR6.3%5.3%5.0%3.0%  

From Table 2, it would appear that things have become stabler from 2019 to 2022 compared to 2016 to 2019. Management Expenses and Commission costs are not increasing faster than gross premiums collected and gross claims paid out.

However, the claims ratio, which is the amount of money disbursed on behalf of policyholders to healthcare providers has dropped from 75% to 73%. As stated in SMA’s position statement, “In USA, the Affordable Care Act or “Obamacare” formally states that Insurers must spend at least 80-85% of premium on health costs; rebates to policyholders must be issued if this is violated. As one can see from the table above, only 75% of premiums collected were paid as claims in 2019 for the IP sector”. We have since gotten even lower than 75% and now stands at 73%, suggesting that the effectiveness or utility of IP as a funding mechanism for private health care has deteriorated further.

The column on “Change in Reserves and Other expenses” is highly variable and subject to individual IP insurer’s actions. For example, in 2020, AIA noted “Long Term Individual Medical Expense: The underwriting result includes a one-off impact of S$(697)m from reinsurance. Excluding this one-off impact, the underwriting result in 2020 is S$(3)m. “. In other words, if we took out this $697m item from AIA, the industry would have made a healthy profit and AIA would not have made a 700m loss in 2020. We do not really know why AIA had to book this one-off 693m item into the books. Is this an accounting treatment and nobody burned through $697m of cash or they really lost all that money in cold, hard cash. This hobbit suspects it is some form of accounting treatment but admittedly, this is just a guess.

The Other Side Of The Coin: Value in Investment (Or the lack of it)

As with all insurance activities, insurers take our money in the form of premiums and surpluses and then invest the premium monies in the quest for good returns (and hopefully these returns will relieve some of the pressure to raise premiums).

In additional to the datasets that SAS has discussed in their 2020 paper, there is actually more information that can be gleaned from Form A5 submissions in the form of Nett Investment Income. This is where the insurer invests the premiums and underwriting gains to generate more income for the company. Whether they are successful or not is another story, as Table 3 will show:

Table 3: Underwriting Gain/Loss and Nett Investment Income: 2019 to 2022

IP insurerUnderwriting Gain/(Loss)Nett Investment Income/(Loss)Operating Results (Underwriting Gain/Loss + Investment Income/Loss)
AIA($664.7m)($19.4m)($684.1m)
GE$38.8m$23.4m$62.2m
HSBC_AXA($13.4m)$0.2m($13.2m)
Income$56.8m($56.1m)$0.7m
Prudential$231.1m($5.7m)$225.4m
Raffles($11.4m)$0.1m($11.3m)
Singlife_Aviva$20.9m1.6m$22.5m
Total($341.9m)($55.9m)($397.8)
Total Less AIA’s 697m$355.1m($55.9m)$299.2m

What are the possible conclusions we can draw from Table 3? Here is what this hobbit thinks:

  • If we ignore or remove the effect of the one-time AIA’s 697m reinsurance figure, then AIA probably made some money from underwriting (?+32M) and only two insurers lost money in underwriting; i.e. the two smallest ones.
  • Insurers often claim that they know how to grow our money, but judging from the data above, maybe they aren’t so good after all.
  • Let’s take the example of a real IP insurer. We will call this insurer – Insurer A, a relatively large IP insurer. They were profitable from underwriting activities consistently for the four years in question: from 2019 to 2022. They made money from investment activities from the first two of the four years. Then they lost 13M in 2021 and a whopping 144M in 2022! Basically they had practically lost all their money that they made in underwriting in this period and then some. One can only wonder what they were doing to lose so much in investment activities in one year.
  • The smaller IP insurers, such as HSBC_AXA, Raffles and Singlife_Aviva are the only insurers that made money from investment activities in all four years. One large insurer only made money in one of the four years, another insurer made money in three of the four years and yet another in two out of the four years. Many of the seven insurers would have been better off putting the premiums in a bank fixed deposits or buying T-bills.

One may counter that insurance premiums are calculated based on actuarial principles and not based on investment outcomes. This hobbit concedes he does not know enough about the insurance industry and maybe that is true. But having said that, if I were the board director of an insurance company or even just a shareholder, one would want to know how will management address the losses arising from investment activities. How does one cover the big hole of say, ($144m)?

Back To Premiums

And now we come back to the issue of IP premiums. Notice whenever anybody wants something more from the insurers, the insurers will respond by saying whatever you ask for will lead to higher premiums? They seem to be looking for every opportunity to repeat this mantra of higher premiums. This is especially so when doctors lobby for more, whether in terms of asking for more doctors to be empanelled or raising fee schedules.

The LIA has just said a few days ago that empanelling more doctors will lead to higher premiums. If every empanelled doctor already sticks to being reimbursed at the rates prescribed by Insurer X’s fee schedule, how can more panel doctors lead to higher premiums for Insurer X’s policyholders? Can the newly-added doctors charge more than the fee schedule? Do more panel doctors mean more over-servicing? Can over-servicing happen frequently when insurers already hire armies of case managers to handle claims and ask questions that range from the clinically unsafe (e.g. why do you do two ward rounds a day instead of one) to the plain stupid (e.g. Why did you not try conservative treatment first before performing surgery on the patient with anal fistula?).

The fact is the majority of IP insurers are making decent margins and profits from underwriting IP policies in the last few years. Prudential, in particular, is doing exceptionally well and it contributes more than half of the underwriting profits of the entire group of seven IP insurers.

And if you look at MOH data released in the June 2023. (Please see chart 1), you will see that doctors’ fees have been rising significantly slower than hospital part of the bill and overall bill sizes.

Chart1 :

(The Straits Times 14 June 2023)

So let’s get things into perspective, the IP insurers aren’t doing badly underwriting IP policies and doctors are not the main culprits for rising healthcare costs in the private sector. Period. And some IP insurers can even do much better if they don’t make bad investment decisions. I think my grandmother can generate better investment returns than some of these folks.

Extracting More Value: Claims’ Ratio Going from 73% to 85%

The slowly declining claims ratio should be of particular concern to policy wonks. I think the world will be a happier place for policyholders and healthcare providers if the government just nationalised the whole IP sector (i.e. like Eldershield becoming Careshield) and raised the claims ratio to 85%. That would mean $1.1B (73% to 85% = 1.1B) more money over four years to pay for healthcare services, instead of now being spent on the supporting infrastructure of “management”, “commissions” and “other distribution expenses” of IP insurers.

On another note, this hobbit has been told that “other distribution expenses” include incentive overseas trips, conferences  and celebratory meals for insurance agents, and perhaps even media advertisements to show who are the most successful insurance agents. And these amounts are not small. For example, one company spent $31m on “additional distribution expenses” in 2022. These expenses are reflected under the “Changes in Reserves and Other Expenses” column in Tables 1 and 2 and are separate from the commissions that agents earn directly from the insurers.

If we can raise the IP sector’s claims ratio from 73% to 85% and extract about $275m a year more from the system, we can probably even have policy portability without significantly raising premiums. This would answer the question of “who pays for portability”. The answer would be, “Still the policyholders. Just cut out the middleman costs of private IP insurers and raise the claims ratio”.

85% is not a magic figure plucked from thin air. It is a figure mandated in Obamacare.  American healthcare is known to be notoriously expensive and inefficient. If they can mandate a figure of 80 to 85%, why should Singapore settle for anything less than 85%?

Then we can move from value-based healthcare to value-based insurance as well. The current IP milieu is failing on both counts. On one hand, the value in IP underwriting to policyholders can be significantly improved. Instead it has declined from 75% to 73%. On the other hand, it is also obviously not delivering enough value from its investment activities in many instances.

So instead of just talking about getting more value out of healthcare providers and always threatening to raise premiums, lets focus on getting more value out of IP sector and the insurers. The public and policyholders expect and need insurers to deliver value just as much as healthcare providers.

Portability and Choice

On 30 April, the President of SAS, Mr Alex Lee, weighed in on the debate in a letter to The Straits Times Form “Time for an inclusive and informed dialogued about IPs”.

He opined that “The data needed to support an inclusive and informed debate on portability, continuity of care, and other aspects of IP design is not available. That needs to change. Policyholders of different profiles must be heard”. He further commented that portability will lead to increase in costs and premiums because “choices have a cost” and indeed, this hobbit agrees that portability is about having a choice and there is a cost to having a choice, especially when you exercise that choice.

This hobbit has long argued that getting a restructured hospital to run four classes of bed leads to increased costs and less efficiency. It would be far better to have less choice for class of beds. We could derive some savings just by cutting down choice. The term management consultants use nowadays is not to “give a choice” but to “retain optionality”.

So choice indeed costs. Henry Ford implied this truth in his autobiography regarding the production of the Ford Model T, when he said “Any colour the customer wants, as long as it’s black”. The retool his production line to provide for different colours for Model T will raise costs.

Similarly here, why are healthcare providers and some policyholders clamouring for portability? Portability is not an end in itself, it is really a means to the end of extracting more value through competition after a IP policy has been bought and especially if pre-existing diseases have developed.

The government’s disdain for riders is well known. Yet IP insurers still innovate and come up with all kinds of riders nowadays. This is because they need to compete for new business and so innovate to develop more perceived value for the prospective customer to sign up as their policyholder.

But once you have developed pre-existing diseases as a policyholder, you are kind of stuck. No competition occurs and IP insurers see no need to deliver more value, especially when the policyholder gets older. They are probably not very unhappy if you decide to drop your IP plan when are you are 75 years old, having paid IP premiums for decades and are now likely to start making claims.

Portability will force IP insurers to compete post-policy purchase and in doing so, hopefully deliver value. Yes, while this hobbit agrees with Mr Alex Lee, President of SAS that choice costs – But this is from the perspective of the manufacturer (like Ford) or the insurer. From the perspective of the consumer, retaining optionality (i.e. the threat of exercising choice) also leads to better value creation through competition on the other side of the equation.

In Search Of Value: Competition and Regulation

However, competition is not the only way to deliver more value and safeguard the interests of policyholders. Another way is regulation so as to address the “power imbalance” that the President of SMA, Dr Ng Chee Kwan, mentioned about in his letter on 27 April 24.

If some regulator stepped up to the plate and started to do most of the following (non-exhaustive):

  • Mandate that the claims ratio for IP business should be at least 80%, preferably 85%
  • Not allow IP insurers to change coverage anytime (remember the incident involving an insurer not covering diagnostic scopes suddenly a few years back?)
  • Mandate that criteria for empanelment and exclusion from preferred panels be spelled out clearly and publicly
  • Regulate the size of preferred panels with respect to the the number of policyholders
  • Regulate on how insurers must grow their preferred panels with time
  • Regulate what can be put into exclusion clauses for disease coverage. For example, they must be evidence based exclusion clauses. E.g. you can exclude coverage of colon cancer if the patient had colorectal polyps discovered previously, but you cannot exclude coverage of all GI cancers from the oesophagus to the anus just because the person had piles.
  • Regulate what can be preauthorised and when preauthorisation can be denied
  • Regulate IP insurers on what questions they can ask or cannot ask. Especially questions that subliminally promote a unsafe practice culture through under-servicing, e.g. “Why do you have to do two ward rounds a day instead of one”?
  • Appointing a SMC-registered medical practitioner to oversee and be held accountable for decisions by insurers that affect patient safety and clinical outcomes adversely

If the above can be instituted for all insurers, then maybe we do NOT need portability so badly..

Bottomline is, other stakeholders in the IP sector, such as policyholders and healthcare providers are looking for a better deal from IP insurers i.e. they are searching for more value than what insurers are providing.

This can come through either by competition or regulation or both. But at present, both are not present. That is why “the current arrangements are untenable and will come to a boil soon enough” (Drs Jeremy Lim and Jake Goh).

Where’s The Value?

The days where the public and healthcare providers accept that IP insurers

  • provide a claims ratio of only 73%
  • do not compete after a policy is bought because there is no portability
  • and are also at the same time largely not subject to adequate regulation

are probably over. We need to find ways to extract the kind of value from the IP insurers that our people need and deserves.

1https://www.mas.gov.sg/statistics/insurance-statistics/insurance-company-returns

Postnote: Alert and mythical reader of this column, Dr Harry the Beng has alerted this hobbit that the figure of $1.1B could be extracted by raising the claims ratio from 73% to 85% over FOUR Years, not one year, or about $275m a year. The hobbit is sorry for these errors and has since corrected them. That’s what happens when you post at around midnight, I guess. In any case, this hobbit would like to suggest to the relevant authorities to consider creaming off any excess premiums that exist when the claims ratio falls below 85% and use the cream-off to fund Healthier SG activities Now, wouldn’t that be a much better way of using those excess premiums than letting the insurers keep the money?

Eyeing the Problem

There has been some concern over a spate for ophthalmologist resignations from the public sector in the last 12 months or so.

But first, some statistics to put things in context. In the latest SMC Annual Report (2022), it was recorded that there are 314 ophthalmologists in Singapore, of which 122 worked in the private sector and the rest (192) worked in the clusters. Therefore, about 39% of all ophthalmologists are from the private sector.

From 2018 to 2022, a period of 4 years, the number of ophthalmologists increased by 42, from 272 to 314. That’s about an increase of 10.5 per year in this period. I.e. we are increasing the number of ophthalmologists by about 10 a year, nett of the ophthalmologists who retire in the same year.

If we assume that the country produces nett 10 ophthalmologists a year, and to maintain the market share between private sector and public sector at around the current 40%/60% split, then roughly 4 ophthalmologists should leave in a 12-month period for the private sector.

However, In the last 12 months, a total of 15 ophthalmologists have left the public sector or have tendered their resignations and are now serving notice, give or take a few. And interestingly, the vast majority of these 15 are senior consultants, or on the verge of becoming one, since the most junior ophthalmologist of these 15 was already registered with the SAB (Specialist Accreditation Board) in 2016, i.e. with at least 7 years of experience as a specialist before resigning. Three of them are very senior, having graduated in the 90s and collectively have chalked up some 60 years of specialist experience between them.

To better understand why so many ophthalmologists have left or are leaving in the last 12 months, we need to first acknowledge that there are several peculiarities of ophthalmology:

  1. The practice of ophthalmology is not as dependent on hospitals as many other disciplines, not unlike dermatology. Hence there is a less pressing need for one’s practice to be located in a clinic suite that is co-located with a private hospital. Hence, an ophthalmologist doesn’t have to pay sky-high rents.
  • Secondly the epidemiological trends of eye diseases are firmly on the ophthalmologist’s side. At least 80% of Singaporeans become myopic by the time they reach adulthood, and this translates into a great pool of patients that can benefit from refractive surgical procedures e.g. Lasik. 80% of the elderly will develop cataracts, which again serves as a very large source of patients.
  • Due to the perceived criticality of sight, patients in this day and age do not wish to be treated by family doctors for eye conditions except for the least complex of conditions that can be treated with just eyedrops and ointments prescribed by the family doctor. Gone are the days when a family physician will routinely attempt to lance a stye or excise a chalazion. Some still do, of course, but they are few and far in between, especially among the younger family physicians. Most GPs are not trained to perform indirect ophthalmoscopy or tonometry and do not have the equipment anyway. All this means that, in comparison to most other disciplines, ophthalmologists take up an inordinately large share of the disease burden.

A secondary factor that needs to be discussed is the role of insurance in private sector ophthalmology. While many other specialties are very dependent on insurance-funded work, ophthalmology is less so. This is because non-insurance work are a plenty in ophthalmology in the form of Lasik procedures and even aesthetic blepharoplasty. That is why despite insurance players resisting recruiting new doctors onto panels and cutting down on reimbursement rates, ophthalmologists have no problem earning a decent living in the private sector sans insurance.

The above can be considered as unmodifiable factors that are particular of ophthalmology that makes going into private practice less daunting when compared to other disciplines.

But it doesn’t quite explain why the sudden exodus has happened. Your friendly neighbourhood hobbit actually went to talk to a few of them. When folks in their fifties and late forties leave, you can be sure that there are significant push factors behind the move. This is in contrast to someone leaving for private practice when they are in their thirties and early forties, when pull factors play a more important role in the decision-making process.

Some of the push factors expressed include:

  1. A relentlessly and sharply increasing workload and punishing work schedule that gets harder and harder to keep up with as one gets older. As one ophthalmologist put it, “At the rate this is going, I can’t see myself growing old and retiring in Institution X, because I don’t think I can keep working at this rate. Might as well go out and work at a less punishing pace now and lengthen my working life”.
  • Changing of remuneration policies. Each institution has a different work and pay culture. Some are more ‘capitalist’ and some are more ‘socialist’. Not a few said that a particular institution was getting more and more socialist in remuneration policy and yet workload kept increasing. Another ophthalmologist said, “You cannot have your cake and eat it too. If you want to make me work harder and see more patients, then pay me more. The pay structure has to incentivise me to chase after more patients. Communist countries failed economically because socialist-style remuneration did not lead to more productivity”. (Oops. This one really hit home for me)
  • There is a need to strike a better balance between research, teaching and clinical service. “Some of us are bearing the brunt of the massive workload and bringing home the bacon for the institution but we are getting paid less than folks who see fewer patients and spend most of their time doing research”.  This is nothing new, the tension between service needs and academic medicine. But somehow the already-delicate equilibrium between the two has apparently deteriorated lately, probably brought on by the rapidly increasing service workload. The tension is more manageable when the workload is likewise manageable. But when the workload becomes unreasonable, then old wounds concealed by a thin scab may just dehisce again.

The obvious solution of course is to train more ophthalmologists to meet the demands of workload. But it takes a long time to train an ophthalmologist. So, in the meantime, the fastest way to beef up supply in the public sector is to recruit ophthalmologists from overseas. Singapore public sector pays relatively well compared to some other countries and it would not be too difficult to recruit ophthalmologists from e.g. UK. But in the long run, this may not solve the problem either. There have been examples of foreign-trained specialists who likewise leave for private practice once they obtain full SMC registration. For foreign-trained specialists with a basic medical degree that is registrable with SMC, the time taken to convert from conditional to full SMC registration can be as short as 2 to 3 years. Unless we plug this hole and mandate a longer period of service before a foreign-trained specialist can obtain full registration and can therefore leave for private practice, recruiting more foreign-trained specialists may be a just a short-sighted or stop-gap measure at best.

In addition to addressing directly some of the push factors stated above, perhaps a better approach is to better distribute the workload between the private and public sector ophthalmologists. But this would require the cooperation of insurers, especially the Integrated Shield Plan (IP) insurers. Not just particular to ophthalmology, IP insurers have  instituted a suite of measures to restrict and reduce IP work in the private sector while pushing more and more work back to the public sector, thereby exacerbating the demand-supply imbalance there. These measures include not just disincentives to seek care in the private sector even though the IP policy provides adequate private sector coverage, but also incentives for the policyholder to go back to the public sector.

There are no easy solutions here but obviously something needs to be done quickly to turn the tide. If not, the dark triumvirate of poor morale, worsening working conditions and more resignations may spill over to the public domain in the form of ballooning waiting times for appointments and surgeries.

SQUIB GAME AND THE DYAD OF MEANNESS

squib – (noun) A short humorous or satiric writing or speech (Merriam-Webster’s Dictionary)

Since my last post, “Letters to Hobbit 2024” (https://hobbitsma.blog/2024/02/15/letters-to-hobbit-2024/), many more alert and mythical readers of this column have stepped forward to give me further examples of stupid questions and requests from high priests of the Insurer Order. While we politely call them high priests, I have been told these chaps have all the charisma, intelligence and persistence of a lice-infested orc.

Further examples of stupid questions:
• “Why do you follow-up the patient every six-monthly instead of 12-monthly” and “Why do you follow-up the patient 12-monthly instead of six-monthly (same insurance company)
• “Did you attempt conservative treatment for this patient before deciding on surgery?” (For a patient with anal fistula). Purported but unverifiable answer: No. Because like his insurer, he wants to be a perfect ass-hole.
• Why did you do a mammogram only on the left breast? (breast cancer found in the right breast and a right mastectomy had been done)
• Please give a memo describing the indications for and results of the colonoscopy done three years ago (for a claim on an operation for a fracture of the right ankle)

And the list goes on…..

This has become so big a problem that there are anecdotal reports that nurses now coming for job interviews with private specialist clinics not infrequently state up-front that their job scope must not include dealing with insurance companies and insurance claims; if not, they would rather not get the job. So private specialist clinics must now hire separate staff just to deal solely with insurance companies and claims.

Dealing with stupid questions invariably is very demoralising and mood-sapping. Other than perhaps an unreasonable patient or family member, there are few things that can ruin a healthcare worker’s mood more than a stupid question from an insurer. And since we are talking about better mental health and mental well-being for all, including healthcare workers, we should really help them by trying to minimise stupid questions. Stupid questions can be considered to be a kind of psychological abuse of the healthcare worker by certain inconsiderate members of the insurance industry. And since we do not even tolerate verbal or psychological abuse of healthcare workers from patients and their families nowadays, why should we tolerate abuse from these inconsiderate members of the insurance industry?

Time and resources spent answering (often repeatedly so) stupid questions could be better spent on more productive tasks like seeing more patients, not to mention the intangible costs of consequent low morale and poor mental well-being of affected healthcare workers.

All this leads to a less efficient healthcare system and higher healthcare costs because well, stupidity is expensive.

And so, in line with the constructive nature of this satirical column, this hobbit would like to propose that the relevant stakeholders of the health insurance industry start a forum or body to look into stupid questions posed by insurance companies and their staff to healthcare providers. We can call this the “Stupid Questions Under Investigation Bureau” (SQUIB). The administrative support of SQUIB will be funded by hopefully, MOH.

This is how SQUIB can work. The SQUIB Panel can consist of perhaps the following:

• A senior MOH doctor (maybe the Director-General of Health (DGH) or Deputy DGH to chair the SQUIB Panel. He will have the casting vote in the event of a tie
• A representative from Life Insurance Association (LIA) to represent the insurance industry’s interests
• A representative from either a Medical School (like a professor from YLLSOM) or a Professional Body like the Academy of Medicine Singapore to provide the doctor’s perspective on what is good practice of medicine
• A representative from the Consumers Association of Singapore (CASE) to represent patients’ interest

We can also hope that the SQUIB Panel will have a voting representative from the (somnolent) regulating authority for insurers. If this happens, this hobbit will buy 4-D, TOTO and Big Sweep all at one go.

SQUIB will process complaints from doctors about stupid questions from insurance companies. To discourage frivolous complaints from doctors against insurance companies, doctors will have to pay a non-refundable admin charge of say, $100 to SQUIB for each complaint filed.

SQUIB will then consider if the complaint is justified or not justified by its members voting. Whether a question is stupid or not will be decided by a majority decision by its members.

If the complaint is not-justified, nothing happens to the insurance company. If the complaint is justified, then the insurance company has to donate $1000 to a registered charity of the doctor’s choice, in the doctor’s name. If the registered charity is also an Institute of Public Character (IPC), then the doctor can claim a tax break from the donation.

There has been informal feedback that doctors are generally afraid to complain against insurance companies or use a forum like the Multilateral Healthcare Insurance Committee (MHIC) because they think they will be thrown out of the preferred provider panels of these insurance companies they had complained against. And it is indeed a fact that today, insurance companies can remove any doctor from their panel without giving any reasons – when it comes to whether a doctor can be on any panel, insurance companies are the judge, jury and executioner. Hence this climate of fear among panel doctors about bringing unfair insurance practices to light.

To allay these fears and promote transparency, the MHIC and SQUIB should require insurance companies to file a yearly list of doctors that have been removed from their panels and check if these doctors are also registered complainants to MHIC and SQUIB. Should they be, then MHIC and SQUIB can request a full report from the insurance company to justify why these doctors have been removed from their panels. If MHIC or SQUIB is not satisfied with the report, then they can refer the case to the insurance regulator for further investigation for possible victimisation of or retribution against complainants by insurance companies.

Finally SQUIB can publish a ranking of insurance companies according to the number of (proven) stupid questions complaints received by SQUIB. They should even publish the stupid questions themselves, if nothing but for a good laugh.

OK, so much for stupid questions. We move on to more latest developments in the health insurance sector. And yes, they are getting murkier by the minute.

Dyad Of Meanness

Recently, there has been feedback from a galaxy far, far away on quite a few incidents involving this insurance provider which we shall fictitiously call “I-come-steal”. Now, I-come-steal has not always been so coveting. They had been quite kind and cooperative previously and they had reimbursed doctors well, often up to the top end of benchmarks, giving doctors very decent income. But they have since left their cooperative stance and gone to the dark side.

Things got even darker when they appointed this claim administrator which happens to be owned by a major facility provider. We will likewise give this claim administrator a fictitious name, “I-am-strange”. There is obviously a potential conflict of interest with I-am-strange. I-am-strange can deny claims from doctors and then benefit from this denial at two levels. Firstly, they get the usual fees from the I-come-steal for services rendered. Secondly, they can shift the money they had squeezed from the doctor to the facility bill side, which will benefit their owners. Basically, they can swop or “exchange” the doctors bill to the hospital bill component. This hobbit has no evidence this has happened, but many doctors this hobbit has spoken to have brought up this potential for double benefit and potential conflict of interest. And apparently, bills incurred at other facilities do not incur the same kind of intense scrutiny as the ones incurred at facilities owned by I-am-strange’s shareholder, which only serves to reinforce this perspective on the ground. All this hobbit can say is I-come-steal and I-am-strange form a formidable Dyad Of Meanness, like The Emperor and Darth Vader.

Next, we move on to another purported example of this Dyad’s shenanigans. They are very quick to explore loopholes in our healthcare system. An example fee is the loophole found between Table of Surgical Procedures (TOSP) and fee benchmarks. In the interests of keeping up with progress in medical science, and to reflect current practice, there is a committee overseeing TOSPs that comes up with new TOSP procedure codes from time to time. So for example, a new surgical code may be created to reflect a combined operation involving two procedures. But the well-meaning TOSP committee’s creation of new codes is not link to the Fee Benchmarks Committee’s work. So this new code does not have an official MOH fee benchmark.

I-come-steal/I-am-strange then conveniently tells the surgeon that the use of an old code (for an operation he has performed for years) is now not accepted. He has to use the new code. The old code may have a fee benchmark (issued by MOH) that is from e.g. $10,000 to $20,000. As a result, the mid-point for the benchmark is $15,000, which is what the surgeon is claiming for, and also what he has been paid in the past. He is now told that he must claim under the new code, for which there is no MOH benchmark. Instead, I-come-steal/I-am-strange now issues their own benchmark of say, $11,000 to $15,000 for this new code. The midpoint is now only $13,000 and the doctor will be reimbursed as such. Which is kind of ridiculous when the new code is supposed to cover an operation which is more complex and involves more resource utilisation but which the insurer has conveniently given an internal reimbursement value that is lower than the old code (for a simpler operation), just because MOH hasn’t issued a fee benchmark for this. This surreptitious move to use new codes with no fee benchmarks is something policymakers should look out for. At the very least, perhaps a new TOSP code can be issued only if it comes with a fee benchmark, to prevent abuse by any insurance provider.

That’s all for this month. This hobbit really hopes someone in MOH will take up the proposal to organise SQUIB. SQUIB Game will be fun and charities will also benefit, which is a very good thing. In the meantime, let’s hope someone keeps a close watch on the unpleasant stuff being dished out there in spades by the Dyad.

Letters to Hobbit 2024

This month, we continue with the tradition of publishing some completely nonsensical letters from our alert but fictitious readers. For the avoidance of doubt, this column is written in the spirit and form of satire. If anyone is offended by this satire, go and suck your thumb. Trust me, it helps. To at least ingest some germs, if nothing else. Your microbiome needs it, since you are so uptight.

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Dear Hobbit

Why do second ward round?

Recently I have been asked by an insurer called Stinklife to justify why I was doing two ward rounds a day for my inpatients. In her email to me, this Assistant Manager of Shield Operations Team (sounds like a person from Marvel Avengers, hence I am very afraid) wrote, “Could you please further elaborate the medical indication/reasons for the justification on why the patient is required 2 visits per day from admission till discharge day. Also kindly state the timing for each visit on each day for our further review”.

I am very perplexed and upset. When I was a young MO working in public hospitals, I was told by my boss that a hardworking and good doctor always tried his best to do two ward rounds a day; a morning round and an evening round. I remember my more conscientious consultants doing their evening rounds with me before they went home.

Now it would appear Stinklife is trying to tell me that my evening round is unnecessary. 24 hours is a long time before an inpatient is seen again, the patient’s condition can turn for the worse in this period.

Dr Chin Du Lan

Cardiologist

Mount Noveau Hospital

Dear Colleague Du Lan,

I am with you all the way here. But it would appear that in our current climate in Middle-earth Healthcare, there is one ring to rule them all – and this is the Ring of the Insurer. This Ring is more powerful than what we learn from textbooks, research papers, CMEs and our professors and role models in the profession. It may have been two ward rounds a day in the past, but since the Wearer of the Ring of the Insurer has spoken, it is now only one round a day. This is mainly because the Wearer of the Ring of the Insurer Regulator sat on his ass for the last 10 years before sailing off into the sunset. The folks holding on to the Ring of the Healthcare Professionals cannot stand up to the wearers of the Ring of Insurers

On a more serious note, I do note that the standard of English from the Shield Operations Team is very bad. Really gave me a ogre-sized headache just going through those two unwieldy sentences.

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Dear Halfling

$5.99 Telemedicine

Greetings in the Year of the Smaug. May you HUAT all the way this year, win TOTO 12 million and your Healthier SG patient enrolment hit the roof!

Recently, I received this EDM tilted “Consult for a Medical Certificate”, the EDM further stated “Teleconsult for Minor Illnesses” – Get a medical consultation started in 5 minutes for $5.99 nett”, “No Video Consultation Required” and “SMC Registered Doctors”

Apparently, the medical consultation may just consist of filling up a form. The doctor will review your case (via the form you filled up online) and decide whether to give you an MC or not. They may get in touch with you if they need further information.

Doesn’t this smell of selling MCs? How does one determine a patient is deserving of an MC without a video consultation and apparently by just filling a form?

Can I do likewise?

Dr Chao Geng,

GP, Eat Snake Clinic

Dear Dr Chao Geng

Since you are also a SMC Registered Doctor, you can of course start a service similar to what is mentioned in the EDM. But a word of friendly advice- you should not charge this odd figure of $5.99. You should charge according to how our CDC Vouchers are designed – in multiples of $2, $5 or $10. This would facilitate faster transactions because your payer, I mean patient, doesn’t have to Paynow you the remaining 99 cents. We need to be more payer-centric, I mean, patient-centric.

You should also do a side business of selling snake soup in the shop lot adjacent to yours. I suspect your patients may have a certain predisposition to eating snake-derived products.

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Dear Shorty

Most Trusted Centre

Recently I have been approached by a person claiming to want to give my practice Tulang Orthopaedic Clinic an award for being one of the “Most Trusted Orthopaedic Centres Adopting Evidence Based Practices and Cutting Edge Treatments in 2024”

This award comes with other benefits, including two full-page exclusive story about Tulang Orthopaedic Clinic which will be designed with images, the issuance of a Certificate of Leadership Excellence, two authored articles written by any person representing the practice, among other things.

All of the above will come as long as I paid them USD2500. If I can buy trust and more patients for USD2500, why not? What do you think?

Dr Hoh Seng Lee

Emeritus Senior Consultant Mentor

Tulang Orthopaedic Clinic

Dear Dr Boh Seng Lee, I mean Dr Hoh Seng Lee

I can see why you want to improve your standing and branding in the market. However, you should really ask yourself if anyone reads this publication or website that gives out this award. And how many recipients of this award will there be? Maybe also 2,500?

You may be better off doing a 15 second dance routine on TikTok that highlights the joy of sucking marrow out of a long bone found in a bowl of orc soup. With today’s woke generation, that may get you more patients than getting an award for being “Most Trusted….”.

The Short One

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Dear Adik the Pendek

Who is Responsible?

I performed a haemorrhoidectomy on a 62 year-old in September last year. After sitting on my claim for some 4 months, I received a letter from the insurer last month asking me to give a memo to justify why a pre-operative ECG and Chest X-ray were needed for this patient. To add insult to injury, the email stated, “Please submit a referral letter/doctor’s memo for our review. Kindly note that the doctor’s memo fee (if any) is not payable under the policy”.

The patient is a 62 year-old. Isn’t it routine to do an ECG and Chest X-ray to assess anaesthetic risk? I am wondering who is asking such basic questions? More importantly, if we do not do a proper pre-anaesthesia workout and something bad happens, who is responsible? The insurer or the doctor?

Dr Tan Kah Chng, Giles,

Giles the Piles Clinic

Dear Kah Chng,

I sense much anger in you. That leads to the Dark Side. Anger leads to pain, and pain leads to suffering.

Please see my above reply to Dr Chin Du Lan. Unfortunately, a standard accessory item to the Ring of the Insurer is the Pendant of Non-Accountability. Wearers of this Pendant cannot be held accountable to any clinical outcome, good or bad, even though they can decide how healthcare services are priced, who can perform and get paid for these services. In short, you, the doctor is still responsible if some disciplinary tribunal decides you have not given professional services of a good enough standard by not ordering an ECG or a Chest X-ray for a 62 year-old patient, and then censures or suspends you from practice.

I need to caution you that the person who asked you to justify the investigations may also be a High Priest of the Insurer Order. These High Priests have developed the ability to ask an infinite number of stupid questions that are designed to frustrate and anger you and also to generate more and more paperwork to justify higher and higher management costs for the insurance company they work for.

Yeah, life in Middle-earth sucks for us doctors. Truth be told, if I can be reincarnated, I will want to come back as an Insurer. I am told the wearer of the Ring of Insurance Regulator has been cursed with the Spell of Somnolence by the dark Sauron, the effects of which seem to be permanent. It doesn’t seem the wearer will wake up anytime soon.

Your friendly neighbourhood, Adik the Pendek

Do We Have Too Many or Too Few Doctors?

A New Year brings new hopes and aspirations. And new worries and fears, unfortunately. In this new year, the hobbit wants to wish all readers of this nonsensical column a very ungratifying year and may all of you remain as ingrates.

This is because in 2024, the scariest word is gratification. Woe be unto you should any of you (especially those in the public sector) be suspected to have received gratification. Gratification can be displayed in many different forms; these include free concert and F1 tickets, or may even be just letting off a loud burp or two after a heavy meal or an upsized cup of bubble tea.

So remember, in 2024, stay ingrate.

Having dispensed with this New Year Greetings and leaving all ungratified, let us now set our eyes on this post’s question: Do we have too many or too few doctors?

As the cliché answer goes – it depends on who you ask

If you ask the public sector folks – they will say too few. The public healthcare clusters are desperately trying to recruit new doctors to fill vacancies that are created when new hospitals and polyclinics are launched. And the government are building these public health institutions (PHIs) rather quickly, in anticipation of increased healthcare needs of an aged population. The frequent complaints about waiting times and appointment times at polyclinics and specialist outpatient clinics reinforce the view that we don’t have enough doctors in the public sector, at least.

But if you look at the MOH Singapore statistics, in 2022, we have 2.8 doctors per 1000 population or about 1 doctor to 357 persons. This figure is in line with those of many developed Anglophone countries, including USA, Canada, UK, Australia etc and better than most countries in the region, including Korea and Japan. Also, Singapore is a small city-state that does not suffer from difficulty of having physical access to doctors that sparsely populated large countries may experience. In other words, even we may not have too many, we probably have enough or near enough doctors, going by national and international statistics and norms.

Then again, if you ask doctors in private practice, they will say the situation is rather saturated and we have enough or even too many doctors. Apparently, seven ENT surgeons have left or are leaving for the private sector in 2024. And we are in January. Prices and rentals for specialist clinic space in private hospitals are shooting up again, suggesting that demand far outstrips supply.

The Public Sector

But let us go back to the public sector again since the public sector employs the majority of doctors. In the latest SMC Annual Report (2022), it is stated that there are a total of 16,633 doctor in Singapore, of which 10,938 worked in the public sector and the remaining 5,695 working in the private sector. (i.e. 65.8% working in public sector or about two-thirds)

Of the 10,938 doctors in the public sector, 4,536 were specialists while 6,402 were non-specialists.

According to a recent article in the Straits Times, (9 Dec 2023), there were 624 doctors working in our polyclinics. These are in all probability not specialists registered with the Specialist Accreditation Board (SAB). That leaves about 5778 non-specialists working in the public sector less polyclinics. There were also 624 house officers in 2022 who need close supervision.

There are a relatively small number of public sector doctors who work in MOH, the statutory boards such as HSA, HPB, and agencies such as MOHH, AIC, Synapxe etc. If we ignore this small group, and take away the 642 polyclinic doctors and 624 house officers, there are 9690 doctors in the public sector. Of which the 4536 specialists would make up 46.8% of all doctors in the public sector.

In other words, there are almost as many specialists as there are medical officers working in the clusters’ hospitals and national specialty centres.

Obviously, this was not the case in our restructured centres long ago. Older doctors can all testify that specialists were a rare thing. In fact, even registrars were a rare thing. Once you pass your M.Med, you are either a Registrar or a MOS (Medical Officer Specialist), and you are given that prized object – the black name tag, which you proudly wear (if you are male) on top of your shirt pocket. You are now officially known as a “Tua Lo Kun” (Big Doctor in Hokkien) and you can now strut down the ward corridor with a spring in your step. Even senior nurses like ward sisters (aka ward managers) treat you with deference. You also get a respectable night call allowance (i.e. more than forty bucks). You gladly buy your on-call team supper. Actually, the registrar paying for supper was almost an obligatory thing, mainly because the more junior doctors were paid peanuts or nothing.

When you become a consultant, you have reached minor warlord status with your small team of registrar, medical and house officers. A consultant cannot be left alone when he or she visits the ward to see patients. A nurse and a house or medical officer will rush to the consultant’s side when he reviews his patients, to take instructions and to update the case-notes.

And finally, when one reaches the demi-god status of senior consultant, junior staff who are not in your team actually now avoid you or at least your stare while those who are, fawn over you, or least pretend to. The air thickens around you wherever you go, and now you are accompanied by the ward sister and at least a registrar when you review your patients. The ward doctors and staff hold a mini-conference before they make the decision to page you, or not. (For young readers, please be informed that there was this thing called a pager and “page” is both a verb and a noun).

Well, all that has changed with the above distribution of medical manpower currently in our restructured hospitals and national centres. As the numbers show, almost half the doctors are specialists. And this hobbit has been told that about half of the specialists are senior consultants (this hobbit has not been able to verify this claim). In other words, if this is true, then about 1 in 4 doctors are senior consultants, another 1 in 4 are either consultants and associate consultants.

There are no more entourages for senior consultants, except maybe the head of department or previous heads of departments. There just aren’t enough junior doctors to accompany every specialist that comes around in the wards. In some departments, the senior consultants outnumber the house officers.

It is therefore a “top-heavy” distribution of medical manpower. Obviously, we have to work in new ways now. But in the long run, one must ask, is this distribution of medical manpower sustainable from a cost-effectiveness point of view? Yet, at the same time, as aforesaid, we often hear of a large number of public sector specialists resigning for the private sector. One wonders, are they mainly senior consultants or more junior specialists?

It is a very complex situation but it would be nice to know what are the planning norms for medical manpower in our public healthcare clusters? E.g. what percentage of doctors should be specialists? And of these, what is the desired proportion for Associate Consultants, Consultants and Senior Consultants? Of course the tertiary hospitals  and national centres could have a larger percentage of senior consultants etc.

This hobbit doesn’t know how many doctors and specialists the public sector needs as a whole, but the gut feel is that we probably either have too many senior consultants, too few junior doctors, or both.

The specialist manpower planning in our clusters is also inextricably linked with the private sector and national situation. It has been said that specialists should comprise 40% of all doctors in Singapore. This target has already attained currently with 40.3% of all doctors being specialists.

The Private Sector

This figure would include the significant number working in the private sector and especially the private hospitals. In our private hospitals, almost all doctors are specialists. But a closer look at the private sector would reveal that only about 38% of doctors in the private sector are specialists, (2163 are specialists out of 5695 private sector doctors). One would assume (wrongly) that the bulk of the remaining non-specialists would presumably be family physicians (FPs).

There are 3532 non-specialists working in the private sector of which only 1707 are registered FPs. That leaves 1805 non-specialist doctors in the private sector who are not on the family physician register. One wonders what do they do? Locums? Working in pharmaceutical companies? Resident MOs in private hospitals? Aesthetic GPs? This hobbit confesses he doesn’t know how this diverse group of doctors can come up to 1805, outnumbering the number of FPs.

Ideally, this group of “undifferentiated” non-specialist doctor in the private sector should be deployed where they are needed most. Perhaps more can be retrained as FPs through the GDFM (Graduate Diploma Family Medicine) route?

Let’s return to the specialist manpower situation again. The recent announcement by MOH (8 Jan 24) that it is interested in exploring the idea of setting up a not-for-profit private acute hospital should be supported. Another Mount Alvernia-like hospital would allow for more specialists to go into private practice without incurring the costs associated with the astronomical price for for-profit private hospital land in Singapore.

Perhaps this not-for-profit private acute hospital would address the possibility that we are having relatively too many specialists and especially senior specialists in the public sector.

But for this to happen, there needs to be a national and professional-wide consensus on the following:

  1. Do we have enough doctors nationally? (with a doctor-patient ratio of 1:357)
  2. Are we getting enough doctors every year (both locally and from overseas, ~ 600 to 700)?
  3. Are we training enough of these doctors to be specialists? (~40%)
  4. Do we have enough specialists nationally, now and going forward (in terms of percentage and in absolute numbers)?
  5. Do we have enough specialists in the public sector (in terms of percentage and in absolute numbers) compared to junior doctors?
  6. Do we have enough senior consultants in the public sector (in terms of percentage and in absolute numbers)?

In line with this New Year’s theme of avoiding any form of gratification, this post ends with more questions than answers……

Not So Merry A Season

It’s that time of the year when practically everyone you know is on holiday overseas. They are taking full advantage of the almost almighty Singapore dollar and standing up for Singapore by chirping “cheap, cheap” from Tokyo to Tasmania and from Seoul to Sao Paulo. Of course, most people do not realise that there are zero-sum games in this world after all – if we find everywhere else cheap, then everyone else also probably finds us expensive. Which probably explains why Orchard Road is rather quiet nowadays, when compared to other shopping districts in the major cities of Asia. But it’s OK, in the meantime, just enjoy the almost almighty Singapore dollar and almost all-conquering Singapore passport.

It’s the season to be merry, after all. But not for quite a few folks

The first group of folks would be the board of directors, management, shareholders and customers of Cordlife Group Limited. In a shocking revelation, several storage tanks in its Singapore operations for stem cells were found to have been exposed to temperatures exceeding that which is deemed allowable. This calls into question if the cells and tissues stored therein are still viable should they be needed. In any case, an accreditation body called FACT (Foundation for the Accreditation of Cell Therapies) has suspended their accreditation of the bank. Most if not all reputable hospitals who can perform stem cell transplants will only take samples that have been stored in cord blood banks that are accredited with internationally reputable accreditation agencies – FACT is one of them. In other words, even if the cells stored are viable, they may not be deemed usable because the accreditation status is now suspended.

Anyway, the incident calls into question a few things, including

  • When and how much did the management and board know about the shortcomings?
  • What was done to uncover the full extent of these incidents to get a full picture of the number of incidents in tank(s) were exposed to higher than allowed temperatures?
  • What were the reasons for these failures in operations, escalation and disclosure?

This will entail probably the Mother of all RCAs (Root Cause Analysis)…..And we haven’t even talked about how this incident affects Singapore’s reputation as a healthcare hub.

The next unmerry thing on the radar is the alleged corruption of the AON Singapore CEO, who has been accused of taking a bribe amounting to $240,000 from Fullerton Healthcare. At first glance, two things are interesting about this case. First, this hobbit doesn’t know how much an insurance broker like AON pays their Singapore CEO, but it is probably well in excess of $240,000 a year. The fact that he was willing to risk his entire well-paid job and possibly end up as a criminal for $240,000 defies common sense. Also no present or past employee or director of Fullerton Healthcare has been charged yet by CPIB. Watch this space carefully.

We move onto something else pretty interesting developing in the Third Party Administrator (TPA) Scene. An unnamed TPA was said to have offered new fee scales to its panel of ophthalmologists. These new scales are so low that they fall well below that of the MOH Fee Benchmarks. In fact, an older ophthalmologist was said to have remarked that the new fee scales are even below what he was offered more than 10 years ago by the same company. Apparently, in 2011 a Table 4A operation was reimbursed at ~$2800. In 2024, the same Table 4A was to be paid ~$2200.

This hobbit is also hoping his bowl of Bak Chor Mee in 2024 will be cheaper than what he paid for in 2011, but that is wishful thinking bordering on the mythical, like Santa coming down the chimney bearing gifts.

But myths and wishful thinking will remain just what they are. Reality, on the other hand, bites. Apparently, more than 90% of the original ophthalmologists who were on this TPA’s panel came to their independent and individual conclusions that it was unwise to remain on this panel for reasons best known only to them and they then quit one by one; leaving just a handful left on the panel. It’s a free world and a market economy we live in. Payers have a right to offer fee scales as they see fit and service providers have a right to independently reject them for whatever reasons. But if I were this TPA’s clients, I would ask why did my panel of ophthalmologists shrink by more than half in 2024 when compared to 2023?

Finally, its squeaky-bum time for the Integrated Shield Plan (IP) providers. On 9 Dec 23, Mr Han Fook Kwang wrote in ChannelnewsAsia (CNA) this commentary titled, “Amid ever-raising premiums, let’s make for no-claim individuals to switch private health insurers”. Now Mr Han is the Michael Owen-equivalent of Singapore journalism. He was the Editor of The Straits Times for many years but now writes for CNA, not unlike how Michael Owen played for Liverpool before playing for Manchester United, both periods to wide acclaim.

In this commentary, Mr Han has come to the conclusion that:

  1. The IP providers want to collect premiums when you are young but are happy for you not to be covered by them when you are old (i.e. the concept of cherry-picking or adverse selection)
  2. There is no real competition between IP providers once a person has chosen to stay with one IP provider due to pre-existing diseases
  3. Smaller IP providers charge higher premiums and also make financial losses

He then recommends:

  1. (More) government supervision and action
  2. Beyond ensuring the financial viability of insurers, there should be someone (or some government agency) out there to look after the interests of the customers
  3. There should be “closer oversight of the premiums charged and what they cover”.
  4. Allowing for “portability for those who have not made any claims for a certain number of years”.
  5. So as to facilitate “a gradual migration to more efficient companies charging lower premiums”
  6. Three to four IP providers will suffice for a relatively small market like Singapore so that real competition exists, instead of seven providers

Many of the above points have also been covered by this Hobbit previously in this Blog over many posts but of course nobody pays attention to mythical me. Hopefully the guys in MAS, the stated regulators of insurers, will pay more attention to what Mr Han is saying. Even though going by the past record of MAS, this is most likely going to remain a hope and nothing more. But’s it is Christmas and Christmas is the season of hope. The hope that MAS will do more than pay attention to financial viability or health of insurers, but also do what Mr Han said about looking after “the interests of customers”.

Finally, we move on to the ongoing Public Consultation of the Health Information Bill (HIB). It’s interesting how this Consultation is carried out – which is in the form of a survey or a questionnaire. The survey consists of a number of questions that demands the respondent to answer in a binary-outcome fashion, either a “yes” or a “no”. Each question is followed by an optional free-text box for you to elaborate, should you so wish.

I think whoever designed this survey should be sent either to the Civil Service College or the Saw Swee Hock School of Public Health for a short course in survey or questionnaire design, because enforcing a binary outcome does not lend itself well to understanding and analysing the nuances in attitudes of diverse stakeholders in what is now usually a complex policy environment. Many respondents may not use the free-text box provided and even if they do, the free text cannot supersede the “yes” or “no” response.

You are conducting a consultation to receive feedback so as to draft bills and fine-tune policies. You are not conducting a referendum like in the Scottish Referendum of 2014, when the Scots were asked whether they wanted to be an independent country or not, in which case a “yes” or a “no” answer is fit for purpose.

Indeed, a “yes” or “no” answer makes for easy analysis later when the consultation process is over. But what will be the quality of the analysis of the survey outcomes that can possibly come out of such a blunt approach?

Don’t Make Things Complicated

Life as a GP used to be simple. But it’s not so simple anymore. And this hobbit is not even talking about Healthier SG and the NEHR. We are just talking about signing up as a member of the Royal College of GP in the UK.

As expected, you need to fill up a form when you apply to be a member. The link to the form is as given below at the end of this post. You are asked to declare your gender identity and you are given the following choices:

  • Prefer Not To Say
  • Man
  • Woman
  • Transgender
  • Genderqueer
  • Agender
  • Genderless
  • Non-Binary
  • Cis Man
  • Cis Woman
  • Trans Man
  • Trans Woman
  • Third Gender
  • Two-Spirit
  • Bigender
  • Genderfluid

The form does not say you have to choose only one out of the above choices. Presumably you can pick more than one?

This hobbit is not making this up. I think when society gets this complicated, it is time to leave where you are and live out your days in a tiny hamlet or a remote island. So that you can figure out what is the difference between “Agender”, “Genderless” and Non-Binary”. Seriously, perhaps the RCGP can conduct some very meaningful CME on what each of the above options mean. I hope our CFPS doesn’t follow RCGP’s footsteps in making the world a more complicated place than it already is.

Thankfully, life in Singapore is much simpler. Most of the time. All the folks need to know is whether your clinic has signed up as a Healthier SG clinic or not and whether your clinic system is NEHR-ready or not.

Speaking of NEHR, the recent Distributed Denial-of-Service (DDoS) cyberattack on Synapxe (formerly IHIS) resulted in public healthcare institutions websites being down for seven to eight hours on 1 Nov 23.

This is a very unfortunate event which has been summarised by The Straits Times’ Senior Health Correspondent Ms Salma Khalik on 2 November as “Having the websites of nationwide public healthcare institutions go down may not be severe, as critical services were not affected. But people’s trust in the efficiency and high level of security of government IT platforms may be shaken as a result. That is the real fallout”.

Synapxe issued a press release on 3 November 23 stating that “Patient data and the internal networks remained accessible and unaffected. Patient care was not compromised”. However it did also state that “On 1 November 2023, an abnormal surge in network traffic was detected at 9.15am. This surge circumvented the blocking service, and overwhelmed Synapxe’s firewall behind the blocks. This triggered the firewall to filter out the traffic, and all the websites and internet-reliant services became inaccessible”. 

The press release further noted that “DDoS attacks cannot be prevented, and the defences against DDoS attacks will have to constantly evolve to keep up with advancements”. 

The public sector Electronic Medical Record (EMR) and NEHR systems were unaffected and hence “patient care was not compromised”. This is because since the Singhealth Cyberattack of 2018, the EMR and Health Information Systems (HIS) in public healthcare institutions have been delinked from the Internet. The government and the public healthcare clusters have the enormous resources to implement this. Today, there are separate computers for clusters’ clinical staff to access the internet for research and other purposes that are totally delinked from the EMR or HIS systems. It would be beyond the resources of private sector clinics, whether GP or specialist, to run a Clinic Management System (CMS) that is not internet-based or -linked.

In fact, most, if not all of the HSG/NEHR-compliant CMS being offered on the market are cloud-based and use existing internet browser interfaces. Gone are also the days when the clinic database is stored on a hard disk located inside the clinic.

If “DDoS attacks cannot be prevented” and somehow the “blocking service” could be “circumvented” by a surge, then how would private sector clinics continue working in the event of a determined and massive DDoS attack if the attack targets the private sector? Indeed, while patient care in the public sector wasn’t affected, many GPs will tell you that the Patient Risk Profile Portal (PRPP) could not be accessed on 1 Nov and hence vaccination information could not be submitted on that day.  You can still submit this on another day I suppose, but one cannot say patient care was entirely unaffected in the private sector, as was the case with the public sector.

Could a doomsday situation happen when all private sector clinics’ CMS are knocked out by a Mother of All DDoS Attacks on the several IT systems that can link up with the NEHR and have been pre-approved as HSG-compliant? And if so, what happens? What is the backup plan to keep private sector clinics running if this happens on a nationwide scale? Are we prepared for such a scenario? On another note, do private hospitals also face similar risks with their EMR and HIS systems in the context of DDoS attacks?

This hobbit is no IT expert and these are tough questions that obviously this hobbit does not have the answers to. But he certainly hopes some folks in MOH and Synapxe do.

Since we are also on the subject matter of forms and making things complicated, let us move on to talk about a local example of a misguided use (or rather, denial of use) of forms. A private sector doctor who wanted to opt out of the NEHR told this hobbit that he has found out the only way to do so is to obtain the opt-out forms from public healthcare institutions (link below). Which is kind of a strange arrangement. This probably has come out of some super-bright, savant-level mind who has deluded/convinced himself/herself into believing that ONLY the public sector can be trusted with the simple task of ensuring that the person who wants to opt out of NEHR is provided with the relevant information to make an informed decision.

The private sector can be allowed to do organ transplants, offer proton beam therapy and separate conjoint twins but cannot be entrusted/empowered to tell a person what he needs to know in order that he can make an informed decision whether to stay in or opt-out of NEHR? The private GP can be empowered to be MOH’s main partners in delivering HSG but cannot be entrusted/empowered to tell the patient what he needs to know about the consequences of opting out of NEHR? If a person opts out of NEHR, he is automatically disqualified from enrolling onto HSG. No enrolees, no HSG, no business for the GP. If there is one thing consistent about private sector GPs – they don’t do stuff that is bad for business. Enrolling patients for HSG is good for business, which is why we see healthy enrolment numbers now.

It makes this “opt-out of NEHR form” sound like a weapon of mass destruction that has to be kept in a sealed bunker or vault that can withstand a nuclear attack and is guarded round-the-clock by commandoes.

Seriously, in Singapore, you can obtain birth or  death certificates, submit your tax returns just by simply logging on to government websites using SingPass on your handphone but you have to visit a public healthcare institution in person just to obtain this mystical form so as to opt-out of the NEHR? What is more important in life than birth and death and taxes??

The genius who came up with this policy really needs to think again and do better. Why make life so unnecessarily complicated?

RCGP online application form:

https://www.rcgp.org.uk/getmedia/d194bd03-14d2-4bfb-b41f-9d2588c66393/RCGP-UK-membership-application-form-2018.pdf

Opting out of NEHR:

https://www.synapxe.sg/healthtech/national-programmes/national-electronic-health-record-nehr/faq

Beware the Middlemen

The Fattest Cats

On 9 October, The Economist published an article, “Who profits most from America’s baffling healthcare system”. The sub-heading read: “Hint: it isn’t big pharma”.

The article began by saying that on 4 October, 75,000 employees of Kaiser Permanente went on a 3-day strike. Kaiser Permanente is a name that many public sector senior management in Singapore may be familiar with. It was the go-to place for study trips and was touted as a model of care that we could learn from, even before the idea of population health became popular or anyone thought about Healthier SG (HSG). The article also noted that in April this year, Kaiser had acquired Pennsylvania-based Geisinger Health, yet another name that many public sector leaders in Singapore may be familiar with.

The Economist article went on to state “Pharmaceutical firms and hospitals attract much of public ire for the inflated costs. Much less attention is paid to a small number of middlemen who extract far bigger rents from the system’s complexity. Over the past decade these firms have quietly increased their presence in America’s vast healthcare industry. They do not make drugs and have not, until recently treated patients. They are the intermediaries – insurers, chemists, drug distributors and pharmacy-benefit managers (PBMs) – sitting between patients and their treatments. In 2022, the combined revenue of the nine biggest middlemen – call them big health – equated to nearly 45% of America’s healthcare bill, up from 25% in 2013”.

It seemed rather ironic to this hobbit that the biggest and fattest cats in America healthcare now are neither the folks that made the drugs and equipment that patients need, nor the hospitals or folks that actually gave the care. The fattest cats are now (drumroll please), “the middlemen”.

Thank goodness there is little chance of that happening in Singapore. For primary care, with the advent of HSG, the third-party administrators (TPA) who sat between the GPs and the patient are largely redundant and will be replaced by the one TPA to rule them all – the government. There is a lot of pain and angst with HSG, especially when it comes to the IT part (such as syncing with NEHR) and worries over drug pricing, but at least the government pays on time and pays adequately when compared to many TPAs. This hobbit does not think that the government will ever become the biggest or fattest cats making money in the primary care sector, but it needs to be said that bureaucracy does have a tendency to becoming fat and unwieldy, although not in a feline or profitable sense.

The government also makes up the lion’s share of the hospital sector, with some 80% of all acute hospital beds, so the middlemen can’t really sink their teeth there too. But when you look closer at the private hospital and specialist sector, the signs are there that we may be walking down the American path.

We need to just look at the profits insurance companies make in Singapore, as well as the increasing amount of money going to management salaries and bonuses as well as the commissions paid to insurance agents and you can see where the proverbial train may be heading.

On top of this, on the provider side, be they at the hospitals or doctors’ end, more and more resources are being spent on insurance-related matters, which include:

  • obtaining pre-authorisation in a timely manner
  • appealing against denial of pre-authorisation
  • filing of claims after service and care has been provided
  • handling denial of claims
  • processing of requests for discounts from insurance companies

It used to be that hospital and clinic staff took on these insurance-related tasks in addition to the regular responsibilities they had. But no more. Now it is not uncommon for a staff nurse to tell the specialist upfront that his/her responsibilities do NOT include dealing with insurance-related matters if he/she is to work for the specialist The consequence is that the doctor now has to hire another staff just to deal with insurance-related matters.

And we wonder why healthcare spending is going up. Soon, we will end up like the USA, where folks on both sides hire legions of staff to frustrate one another in the private hospital sector.

On 10 October 2023, MOH announced that through its Claims Management Office (CMO), it was issuing Claims Rules. Medishield Life (MSL) claims deemed potentially unreasonable are now subject to adjudication by an independent panel appointed by the MSL Council.

“If the claim is found to be inappropriate, the medical institution and/or doctor will be asked to rectify and refund the inappropriate portions of the claims and not recover the monies from the patient”….”MOH is stepping up our monitoring of inappropriate claims and will not hesitate to act against the small minority of doctors who are found to be repeatedly non-compliant despite warnings. Repeat offenders may have their accreditation status under the MSL and Medisave schemes suspended or revoked”. (MOH press release dated 10 Oct 2023).

All well and good. In a population of thousands of specialists, there will be a few who don’t play by the rules or reasonableness and they have to be managed actively, if not managed out.

The press release also stated that speciality-specific claims rules have been and will be developed. These rules are based on “evidence-based literature, prevailing clinical practice and cost-effective guidelines”. It was also stated in the same release that the first set of claims rules for gastrointestinal endoscopy was released in August 2022. Two more sets of claims rules were released in September 2023 for ENT and cardiology.

All these efforts are to ostensibly primary protect the interests of the patients and to keep MSL financially sustainable in the long-term. This hobbit has nothing against supporting practices that are “cost-effective” and “evidence-based”.

However, what about the other side of the equation with the insurance companies who sell Integrated Shield Plans (IPs)? IP premiums and claims sit on MSL premiums and claims. Who ensures IP providers are “cost-effective” and “evidence-based”?

Cost-effective?

Does anyone in Singapore set a minimum limit on how much of the premiums collected are spent actually on paying for healthcare? Or IPs can spend as they like on management costs and commissions and also on amassing profits?

USA’s Affordable Care Act or “Obamacare” states that 80 to 85% of premiums collected should be spent on healthcare costs. But in Singapore, between 2016 and 2019, the corresponding figure is only 75%, with the rate of rise for management costs and commissions being faster than claims (i.e. payment for claims for healthcare provided) between 2016 and 2019. Can such a state of affairs support the aim of being “cost-effective”?

Evidence-based?

As for “evidence-based”, what is the evidence for some IP providers selecting certain doctors to be empanelled over others?

It was stated in the SMA’s Position Paper on Troubled IPs (May 2021) that “The Health Insurance Task Force (HITF) Report stated ‘To enhance and ensure transparency of the arrangement (e.g. disclosures on the healthcare provider selection process)’, that is, IP insurers should state the criteria used to select doctors to be on a panel. The fact remains that no doctor or policyholder knows what the actual quantitative or qualitative measures that make up these secret criteria are”.

This was the state of affairs in 2021 and remains so today.

In other words, the exercise of selecting doctors for empaneling is a completely opaque exercise with no accountability to regulators, policyholders and of course the hapless healthcare providers who do not get selected.

But this is just the tip of the iceberg about evidence-based. What is far worse is the exclusion clauses and denial of claims that are inflicted on policyholders that are not evidence-based. Policyholders are not healthcare professionals armed with the knowledge to understand and appreciate the true impact of these clauses up-front. Only years later, when they need to make claims for conditions that are excluded, they then experience dismay if not devastation when they receive notice that their claim has been denied. Some IP providers also indulge in semantics to get away with paying for claims. The examples of non-evidence-based exclusion clauses and denial of claims are many. Some of the commonest or egregious ones include:

  • A history of breast cysts leading to an exclusion clause for all breast conditions, including breast cancer. (The evidence is that breast cysts do not become cancerous)
  • A history of piles or anal abscess that leads to an exclusion for all colorectal conditions. Some insurance companies even state that all gastrointestinal conditions are excluded! What has an anal abscess got to do with stomach or colorectal cancer?
  • A major branch of the Left Anterior Descending Artery (LAD: a major coronary artery) is the diagonal artery. A claim for a stent inserted for a almost completely occluded diagonal artery is denied on the grounds that the diagonal artery is NOT the LAD, it is a branch. (That is like saying your car insurance policy only covers you for the main Singapore island but not Sentosa). Well for the record, a heart attack involving the diagonal artery can lead to death and disability too.

No Two-way Street

This hobbit can go on and on. But at the end of the day, one of the major conclusions from this exercise that this hobbit has arrived at is that while healthcare providers, such as doctors, are compelled to practise in a cost-effective and evidence-based way (and rightly so) when MSL is involved, there is no such requirement for IP providers although IP premiums and claims sit on the MSL framework. IP providers just need to be seen to be financially sustainable to their regulator and when things get rough for them, they can resort to that one usual and effective trick they have up their sleeves:  – the ability to get away with squeezing healthcare providers and policyholders ever harder by raising the spectre of premiums increasing for policyholders if they are not allowed to get their way. (I gotta admit, this is a beautiful strategy that works like a charm, something almost akin to a kid throwing tantrums when he realises that he always gets what he wants by doing so)

But one should perhaps wonder: for how long more can this lop-sided state of affairs continue?

And while we may reassure ourselves that the private hospital and specialist sectors constitute a small part of healthcare delivered in this country, the fact that about 70% of Singapore residents have bought an IP policy means that there is great potential for this to mushroom into a big problem later on.

Previous posts on the subject of IP:

https://wordpress.com/post/hobbitsma.blog/914

https://wordpress.com/post/hobbitsma.blog/865

https://wordpress.com/post/hobbitsma.blog/773

https://wordpress.com/post/hobbitsma.blog/757

https://wordpress.com/post/hobbitsma.blog/749

https://wordpress.com/post/hobbitsma.blog/731

https://wordpress.com/post/hobbitsma.blog/709

https://wordpress.com/post/hobbitsma.blog/664

Things We Should Really Be Teaching Our Medical Students Today

It was announced recently that a new common curriculum for incoming NUS dentistry, medicine, nursing and pharmacy students will be introduced (The Straits Times, 16 Aug 23)1.

The Straits Times reported that the aim of the common curriculum covering five modules was to “imbue in students a greater awareness of social issues and their impact on health, as well as cultivate teamwork, communication skills and digital literacy. Students will also learn about working and communicating in multidisciplinary teams, as well as the legal and ethical principles underpinning the practice and delivery of health services”.

“The curriculum combines healthcare, data science, artificial intelligence and information technology to equip students in using data effectively to improve patient outcomes and information flow across healthcare IT systems”

The above stated purposes are indeed laudable. Let’s hope they can achieve what they set out to do. But why stop here? As this hobbit looks back on his medical education received from the local medical school as well as what is happening around him now, he cannot but think that there were some things that the School can do to improve things further.

Here are a few suggestions as to how the curriculum can be improved even more with the introduction of a few more fresh modules….

The IHIS/Synapxe Module

On 27 July 23, the organisation called IHIS (IHIS – Integrated Health Information Systems) was renamed, or to be exact, given “a new identity”, as Synapxe. In his speech on that day, Minister for Health said that IHIS/Synapxe “is a 4000 strong organisation today”2.

IHIS has been in existence since 2008. It is therefore NOT a new organisation, and it is a big organisation that is responsible for providing IT support to the public healthcare system and rolling out the NEHR to the private sector as well. Its influence permeates every aspect of care in the public sector, which consists of the three healthcare clusters that contain 10 restructured hospitals, 23 polyclinics and as well as community hospitals and national specialty centres.

From the many conversations this hobbit has had with quite a few young doctors, they don’t seem to be aware that IHIS/Synapxe exists even though it has been around for 15 years and what it is actually supposed to do. All these young doctors know is that they have to grapple with an EMR that is so important that the restructured hospitals and polyclinics are almost paralysed when the system is down. Even specialists in the public sector don’t know what this organisation is supposed to do. So it is important that we educate our medical students about Synapxe comprehensively and how big and important it is.

To put things in perspective, there are some 4000 people working in Synapxe. From the SMC 2021 Annual Report (the latest available on the SMC website) there were 4,368 specialists employed in the public sector. That means for every public sector specialist providing care to our patients, there is also one Synapxe employee working behind the scenes.

To put things in even bolder relief, according to the 2022 Allied Health Professionals Council Annual Report, there were 1485 diagnostic radiographers, 1003 physiotherapists, 154 radiation therapists, 249 speech and language therapists and 520 occupational therapists working in our restructured hospitals, national specialty centres and polyclinics (i.e. the three public healthcare clusters) in 2022. This makes a grand total of 3411 Allied Health professionals from these five groups employed to deliver important care in the three public healthcare clusters, but this number is still significantly less than the number of people employed by Synapxe! Come to think of it, our medical students should really learn how to work with Synapxe employees since there are more of them than there are allied health professionals.

Medical Law Module: Lawful, Unlawful and Lawless

The aforesaid Straits Times report stated that medical students will learn about the legal and ethical principles underpinning the practice and delivery of healthcare services. Presumably, they will learn about legislation such as the Medical Registration Act, Medicines Act, Healthcare Services Act etc as well as the SMC Ethical Code and Ethical Guidelines (ECEG). This is excellent because this hobbit didn’t think he was taught any of these laws while in medical school. We need to teach medics more than the science and art of medicine, they need to know what is lawful and ethical and what is unlawful and unethical.

But this is also not enough. We need to teach them about what is lawless too. There are organisations such as third-party administrators (TPAs), insurance companies, such as Integrated Shield Plan (IP) providers that can influence, organise and even direct healthcare provision but at the same time do not come under any law that regulates how they do so and ensures that they do not undermine the practice of ethical or lawful clinical medicine.

For example, IP providers are regulated to ensure they are sound financially, but there is no law that can stop or punish an IP provider from suddenly stopping coverage for something as fundamental as a colonoscope, or for denying coverage to a policyholder for colon cancer because he had bleeding from piles 10 years ago. These are the lawless aspects of our healthcare environment that every medical student should learn early – the sordid facts of life that a doctor will face sooner or later as a doctor.

Patient Confidentiality and Privacy Module

We always talk about patient confidentiality in our medical ethics lessons and when teaching our students and young doctors about the dos and don’ts when accessing and using EMR and NEHR. But we never talk about patient privacy rights. In fact, there is nothing on patient privacy and their privacy rights in official documents that this hobbit is aware of. Hence, there are also no established standards to articulate what is a patient’s right to privacy.

Which is kind of incredible for a first-world country such as ours.

Every ethicist worth his salt will tell you that it is almost impossible to define a patient’s confidentiality rights well before we have some clear idea about what are the patient’s privacy rights. How does one define a patient’s confidentiality rights when there are no privacy rights standards and therefore he has no established and expressed rights to information privacy in healthcare? Confidentiality is built on the foundation of privacy. But somehow, we have been able to talk about ensuring patient confidentiality by suspending it in thin air without anchoring it to the principle of privacy.

This hobbit wonders how much longer can we continue to ignore teaching the principles of patient privacy and privacy rights to our medical students (and for that matter, to all healthcare professionals as well) and just continue to harp on only ensuring patient confidentiality. Its like trying to teach medical students histopathology without first getting the student to learn histology and anatomy

The Expectation Module

We really need to educate our medical students that they have to moderate their expectations of the good material life that they think they will have. This should be done right after matriculation.

Here are the numbers. As of 2021, there were 16,044 doctors licensed to practise medicine in Singapore, of which 6,431 were specialists. The number of doctors increased by 776 over the previous year.

Twenty years ago, in 2001 (SMC Annual Report 2001), there were 5,922 doctors in Singapore, of which 1930 were specialists. The number of doctors increased by 345 from 2000.

Over 20 years (2001 to 2021), the number of doctors increased by 2.7 times and the number of specialists increased by 3.33 times.

The doctor-population ratio in 2001 was 1: 678. In 2021, the ratio had fallen to 1:3693.

Our medical profession is growing a lot faster than the general population. The population in Singapore hasn’t increased by 2.7 times in 20 years, even though they have aged and should consume more health care per capita. But the fact remains that doctors are fast losing any rarity effect that they used to enjoy.

Unfortunately, the number of freehold housing properties and Certificate of Entitlement (COEs) have not increased as quickly as the number of doctors here. In fact, the vehicular population is now at almost zero-growth. The end result is that most doctors of the future will not be able to enjoy the so-called finer things in life that their predecessors did: large cars, freehold condominiums and landed properties, golf club memberships etc.

Going forward, the median income of doctors will move more and more towards the median income of the general population. The end result is that things that can only be afforded by say, the top 5 to 15% of income earners will be out of reach of many doctors unless they have parental assistance to purchase these things or they are at the top of their game in terms of earnings. This would include private housing and it won’t be long before we see large segments of the profession staying in HDB flats. Hopefully,  doctors in the future should still be able to afford HDB Prime and Plus HDB flats.

Our medical students need to know that given the numbers, this scenario is all but a certainty due to the inevitability of statistics. And we should really tell them the whole truth as early as possible. Of course, there will be still be a very few within each cohort that can end up in big houses and own very expensive sports cars, but these will get rarer and rarer as long as the doctor population is growing at a much faster rate than the general population.

Don’t get this hobbit wrong, there is nothing wrong with staying in HDB flats like 80 to 85% of the population. This hobbit grew up in a HDB-shire and thoroughly enjoyed his 30 years living there. He may yet return to one when he gets older to enjoy the amenities and subsidies that HDB dwellers enjoy. But he is worried that many young doctors and medical students may set out with material expectations which are misaligned with the eventual reality that many of them will experience.

1https://www.straitstimes.com/singapore/new-common-curriculum-for-incoming-nus-dentistry-medicine-nursing-and-pharmacy-students

2https://www.moh.gov.sg/news-highlights/details/speech-by-mr-ong-ye-kung-minister-for-health-at-the-integrated-health-information-systems-15th-anniversary-and-launch-of-new-identity-27-july-2023-9-40am-at-singapore-expo-hall-3

3https://www.moh.gov.sg/resources-statistics/singapore-health-facts/health-manpower

Going Private 2023

Recently I received in my email an EDM about a seminar organised by the SMA, “Taking the Plunge – Going Into Private Practice” which will be held on 26 Aug 2023. That set me on thinking of what it means to go into private practice in the post-Covid world of 2023.

Specialists

I was just chatting with some young surgeons the other day and was astonished to find out that apparently, at least 12 orthopaedic surgeons have left for the private sector in the first six months of 2023! From anecdotal evidence, this exodus is not just limited to orthopaedics but extends to other specialties as well.

There are several interesting new trends in the current round of private sector entrants in the specialist sector. For one, very senior people, including folks in their fifties are leaving when in the past, it was those in their late thirties and early forties who usually quit. You hardly if ever hear of a fifty-something year-old leaving. Secondly, folks now don’t leave one at a time from one department. They often leave in twos and threes.

This sudden surge in folks leaving for private can be another unwanted aftermath of the Covid-19 Pandemic. Few people dared to leave for private in the Covid years of 2020 to 2022, and so now there is a rebound, as in the number of people who normally would have left for private over three years have now been compressed into a one-year period.

Of course, when folks go private, they have to go somewhere in private. And this somewhere has translated into sky-high prices and rentals in popular private hospitals. Clinic space in a big freehold-lease private hospital have reached $12,000 to $13,000 per square foot. In another large hospital in town where only about 60 years remain of its 99-year lease, prices are going at about $9000 per square foot. Rentals in both these hospitals are now frequently in the $23 to $25 per square foot range.

All this may suggest that the environment is hunky-dory outside in the private sector but this cannot be further from the truth. Firstly, severe manpower constraints, especially in nursing, have meant that private hospitals often cannot be operating at full capacity. Wards and especially operating theatres are not infrequently closed. Unless absolutely urgent or it is an emergency, one frequently cannot find a bed to admit a patient. OT slots are even harder to find and many surgeons have told this hobbit that they consider themselves very lucky if they can find an elective OT slot within three weeks for their patients. So there are some serious capacity issues that limits one’s earnings in the private sector, even though demand for their services may remain high from both local patients with integrated shield plans (IPs) and overseas patients.

Which brings us to the next topic of the day, IPs. IP reimbursement remain parsimonious and clustered at the lower half of the MOH Fee Benchmarks. MOH has just released the second edition of the Benchmarks last month. It remains to be seen if the IP providers will revise their reimbursements upwards to keep pace with the newly-revised Benchmarks.

Another perhaps even more discouraging trend we are seeing is that IP providers are seemingly very reluctant to admit new specialists to their preferred panel of providers. The common lament of new private sector specialists we hear is that they find it extremely difficult to get into IP panels. Older and more established doctors may belong to four or five panels but newer ones consider themselves lucky to be in more than one panel.

Therefore, there is possibly a “dual ossification” happening here. The first ossification is that of reimbursement rates as IP providers drag their feet to pay more to be in line with the new benchmarks, resulting in specialists’ earnings per patient or per procedure unlikely to increase significantly anytime soon (if ever). The second ossification is of preferred provider panels where these panels are largely frozen in time with very limited number of new entrants resulting in new specialists being shut out. Frankly, this hobbit thinks that regulators should state some standards for preferred panels. The size of panels should be in line with the number of policyholders an IP provider has. For example, an IP provider with 1M policyholders should have 2x the number of preferred providers that another IP provider with only 500,000 policyholders has. And it should be stated that no matter how small the pool of policyholders are, every IP provider should have at least have  a bare minimum X number of preferred providers.

These two phenomena are actually known to the specialists who are contemplating going private.

If you think about it, a specialist going private now have to face up to a quintuple-whammy of:

  1. Reimbursement rates by IPs not increasing fast enough or at all
  2. Getting acceptance into an IP preferred provider panel is getting more and more difficult
  3. Rapidly rising prices for purchase or rental or clinic space/medical suites
  4. Workload constraints due to healthcare facility capacity limits and/or manpower shortage
  5. Increased competition among increasing number of private sector specialists

Yet, they are still going private. Why is this so?

This hobbit thinks that this may have to do with expectations:- Things are bad, but if you are convinced that if things are not going to get better, then even if things are bad now, it is still better to leave sooner rather than later.

Will workload and waiting times in restructured hospitals get better? Will the EMR get easier to use? In a mistake-intolerant environment, will the trend to get consultants to do more and more work that were previously done by medical officers and residents reverse itself? Will private hospital clinic space get cheaper when no one knows when will land for a new private hospital be made available?

If the answer to the above questions is a consistent “No”, then people will still leave. In other words, whether the going is good or not is not as important as whether the going is going to get worse; i.e. staying on is not tenable.

A simple example of the importance of expectation is that of private hospital and private hospital clinic or medical suite space. The last private hospital land was released 15 years ago, around 2008. No one knows when the next piece of land will be released for building a private hospital. This is exacerbated by the precedent of sky high prices paid for the last private hospital land that was put up for sale. This leads to the current situation where specialists will pay an arm and an leg to secure medical suite space. The uncertainty of when new hospital co-located medical suites will be made available in the market leads to the persistent expectation that demand will outstrip supply which in turn feeds higher prices for such assets. This can been seen by the fact that 15 years after the last release of private hospital land here, the 2008 price for that piece of land is probably still the most expensive hospital land on this planet (on a per square foot built-up area basis) today!

Things would be different if the relevant authorities are publicly committed to releasing land for say, a 300-bed private hospital every 10 or 12 years. Specialists and hospital operators will then plan accordingly with that certainty in mind, instead of pushing up prices for land and medical suite which in turn leads to more and more expensive private healthcare.

Family Physicians (FPs)

On another note, let’s turn our attention to FPs. Healthier SG has been largely welcomed by the current generation of FPs. But among younger doctors still in the public sector, many are also thinking of going private as well; either to set up their own GP clinics or groups, or to join an existing group. The reasoning is quite simple – Enrolment under Healthier SG is truly underway now. However, in a few years, it is expected that everyone will be enrolled with a FP under Healthier SG. In fact, this is one of the stated aims of Healthier SG – Everyone should have a FP. Will there be many people who still need to be enrolled with a FP in five years’ time? The only folks that may require enrolling in the future may be new PRs and citizens, who did not enjoy Healthier SG benefits when they were  previously not residents in Singapore.

In other words, the Healthier SG pie for new FPs will be getting smaller rapidly as the pool of people without Healthier SG shrinks. It is also likely that future generations of Singaporeans will sign up with the same Healthier SG providers that their parents have enrolled with. Or rather, they may have already been signed up when they were kids, and they will likely continue with the same providers when they grow up. Not unlike why this old coot is still using the same POSB bank account that he has had since Primary 1 when some nice bank officer came and signed up practically everyone in the class.

In business school, they call this “first mover advantage”. Indeed, the first mover will almost always have an advantage. But it cannot be to the point that future generations of FPs will be existentially disadvantaged. Young FPs and FPs- to-be now in the public sector are right to worry about this and policymakers could pay attention to this so as to make Healthier SG attractive for future generations of FPs.