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

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

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

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 The Hobbit has reproduced these withdrawn Guideline on Medicine Fee which was issued in 1998 in the second section of this post (which in turn was reproduced in the June 2001 issue of the SMA News that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

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

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

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

• A bird in the hand is worth two in the bush. The GPs are now earning decent margins from dispensing activities, while participating in the treatment of chronic enrollees will definitely lead to an erosion of margins and loss in earnings. The GP has got to earn more money from MOH payouts from other Healthier SG activities to address this loss in earnings. To qualify for these payouts that range from $130 to $180 a year for each chronic enrollee, several milestones have to be reached. These are reasonable milestones from a clinical standpoint, but the reaching of these milestones require the full cooperation of the patient. And as any experienced GP will tell you, patients may not cooperate with you fully for a host of reasons best known to the patient. There is therefore much uncertainty in this.

• There is no guarantee from any other party as to the number of new enrollees each GP will get. Participation is strictly voluntary for the patient. MOH or the clusters will not forcibly assign any new patients to any GP. In the worst-case scenario, a GP may get no new patients and his existing patients are converted into Heathier SG chronic enrollees and hence subjected to strict price-caps when whitelisted drugs are used. In effect, a GP is subjected to unilaterally offering price guarantees without a corresponding guarantee of any significant increase in business volume from other parties. (Unfortunately, repeated expressions of “don’t worry” do not amount to a business guarantee in real life)

• The GPs think they know their business better than anyone else and therefore they think they are right. (The counter-argument suggests that the bureaucrats think they know the GP’s business better). And what is worse, should the GP be right, no one will compensate them for the loss in earnings. In other words, they bear most, if not all of the business risk of this grand endeavour.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

The Covid non-Award Award (Category A)

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

The Covid non-Award Award (Category B)

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

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

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

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

Now, we move on to other awards for 2023

Community Destruction Award

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

Once Bitten Twice Shy Award

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

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

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

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

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

Great Singapore Sale Award

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

Most Unwelcome Sequel Award

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

Best Evidence Award

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

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

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

Mental Sclerosis Award

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

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

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

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

Ugly Neighbour Award

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

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

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

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

Maybe the Indian authorities today still think likewise.

Coming of Age Award

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

On 17 Nov 22, while referring to the NHS (National Health Service), the British Chancellor of the Exchequer (a fancy UK name for Finance Minister) Jeremy Hunt, said in the House of Commons (a fancy name for Lower House of Parliament), “We want Scandinavian quality alongside Singaporean efficiency, both better outcomes for citizens and better value for taxpayers.”…(Ref: https://www.bbc.com/news/av/uk-politics-63663033)

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

• Whether a treatment is off-label or on-label (which as this hobbit has said before, what is off or on-label can come down to a rather unscientific basis – like Viagra and pulmonary hypertension)

• Whether a treatment is supported by evidence based on inferential statistics (i.e. based on statistics derived from a group of people) in the era of personalised and precision medicine

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

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

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

Recently, there was a report in mainstream media about how an Integrated Shield Plan (IP) provider refused to provide cover for a patient who was suffering from cholangiocarcinoma. The reason given was that the immunotherapy drug was normally used for breast cancer and not for cholangiocarcinoma. The use for cholangiocarcinoma was “off-label”. (Cancer patient ends up with $33,000 bill after insurer refuses to pay for drug).

Two letters from members of the public (both doctors) were published in The Straits Times Forum on 24 April 22 and then MOH and Life Insurance Association (LIA) subsequently weighed in with letters on 25 April 22.

Military colleges often teach that a country fights a war for usually two reasons:

• It thinks it can win the war, thereby achieving the objectives it has set out for the war, so it fights, or
• If it doesn’t fight the war, the country, culture and society as they know, will be destroyed and it may well cease to exist. i.e. the conflict poses an existential threat to the country.

For example, in the current Russian invasion of Ukraine, Putin is claiming the second reason, but his calculus for starting the war was probably that of the first. Ukraine on the other hand, is fighting obviously based on the second reason.

While the arguments put forth by LIA and MOH are not invalid – cancer drugs can be frightfully expensive and their use needs to be controlled in some way, the elephant in the room in this case is that the patient is alive, and appears to be having a decent quality of life. In other words, the immunotherapy drug Pertuzumab worked.

This is quite remarkable given that cholangiocarcinoma patients often live for several months only and the patient is alive and walking around 22 months after diagnosis. The other salient point is that Pertuzumab was not given callously. It was only given after two other conventional drugs had failed.

The last point that should be noted was that we are arguing over $33,000 for something that worked and gave someone a decent quality of life for many months. Not exactly a sum that will sink the system in Singapore, even though it may be a lot to an individual. Putting a patient on a ventilator in ICU for about a week often costs that much if not more, and as we know, many a time the patient ends up not making out of the ICU alive.

It is true that there is scant evidence that Pertuzumab works for cholangiocarcinoma. But we need to remember that clinical evidence is based on inferential statistics – the science of probabilities based on assumed distribution of values (e.g. the bell-shaped curve of a normal distribution).

Let us now return to this patient at hand, Ms Koh Ee Miang. Probability-based and evidence-based medicine mean little to her. Only one thing matters – either she lives on, or she doesn’t. And at only 45 years old with a teenaged daughter, the will to fight for her right to live on (and again this hobbit stresses – with  a decent quality of life), must be very strong. She will fight. She has to fight. She is fighting based on the aforesaid second reason – if she ceases to fight, death will beckon quickly and she will cease to exist.

And indeed, this is exactly what has happened. She has gone to the press so that her plight gets highlighted. And really, the answers and replies so far from the establishment aren’t exactly useful to her or her oncologist.

What does the oncologist do now? Stop the medicine? Should she not have even given her Pertuzumab in the first place? Just let her be overwhelmed by the cancer after the two conventional drugs failed? She’s 45, not 85…..

And then there’s the issue of off label and on label use. The letter from LIA makes it sound like off label use is always an undesirable thing. But that is simply not true. Whether something is considered off label or on label use may be just a commercial consideration.

Let’s take the example of Sildenafil – what is now commercially known as Viagra. Viagra is now famous for being a drug used to treat erectile dysfunction. But Sildenafil was originally put on clinical trial for use as a drug to treat pulmonary hypertension. However, it was then serendipitously discovered that many trial (male) subjects had erections and viola, Viagra was born.

As far as this hobbit knows, the use of Viagra in Singapore for erectile dysfunction is on label but not pulmonary hypertension. It is not because Viagra is not effective against pulmonary hypertension. After all that is what it was intended for and there is clinical evidence to support this. The drug company just didn’t apply for it with the drug regulation authorities for reasons best known to itself. It could be the market for pulmonary hypertension is much smaller than erectile dysfunction and also because of risk management. When a drug is used off label, the doctor and hospital bears the risk. When it is on label use, that risk is shared with the drug company. Since the market for treating erectile dysfunction is such a big and lucrative one, why should a company take on the additional risk of it being used as a pulmonary hypertension drug?

Whatever the case may be, whatever is on label is at the discretion of the drug company when it puts up the drug for registration with the authorities. The authorities can reject the application because of lack of scientific evidence, but they have no powers to ascribe something as on label if that is not applied for by the drug company.

It is noteworthy that the MOH letter to The Straits Times Forum did not mention on label or off label use. It talked about scientific evidence. Because on label or off label use is not quite the gold standard of appropriate use it has been made out to be. There are many drugs that are being used off label in both private and public sector healthcare settings. It doesn’t mean that off label use is always imprudent or unsafe.

Let us now return to the patient. Since missing Pertuzumab for one session in January, her cancer markers have shot up by about 50%. In fact, it was reported that the oncologist may have to change to another even more expensive HER-2 drug because the effects of Pertuzumab are “waning”.

As Dr Jeremy Lim implied in his letter in The Straits Times Forum on 24 April 22, in the age of precision medicine, (e.g. immunotherapy), some finesse is needed. In evidence-based medicine, all of us have been taught that the 95% confidence interval and p<0.05 are sacrosanct. But 95% is not 100% and what about the remaining 5%? What if somehow something that falls outside the 95% actually works for this individual, do we deny this person care? Especially when we are pretty sure that this denial will lead to a quick and premature death?

This hobbit would like to see if some IP providers will think out of the box to address these issues instead of drawing a line in the sand about on or off label use. For example, it could have covered the treatment for just two to three months to see if the treatment works. If the treatment doesn’t work then by all means withdraw cover. But if the treatment works then it should continue cover but the coverage would be subject to reimbursement caps that are stated upfront.

Personally speaking, I would have thought that the IP provider should have just paid out the $33,000 for a treatment that manifestly worked for their policyholder, a living human being. All IP providers profess to care about their policyholders in their marketing materials and public communications. But here again, this hobbit is reminded that insurance companies are business entities designed to maximise shareholders’ value. Bad press, public opinion or the almost certain prospect of an unnecessarily premature death matter little when their bottom line is hit by about $33,000.