SMC’s new requirements on doctors with regard to Third Party Administrators (TPAs) are finally in force. But not before some frantic and often bewildering announcements by many stakeholders; including the SMC, the three professional bodies (PBs) and of course, the TPAs themselves.

Many of the TPAs announced some new charging system that did not involve percentages but in fact, still looked like they were fee-splitting, thereby undermining the spirit and substance of the new SMC requirements. Of course, SMC had to respond with a last-minute Advisory and the three PBs also then added in their bit to remind doctors. Finally, several TPAs then responded with a literally last-gasp amendment to the charges and contracts they were offering doctors. A handful of TPAs were issuing new charging schedules on as late as 30 June 2017 – the eve of the new SMC requirements’ implementation.

All these last-minute jostling and positioning maneuvers underlined several hard truths which this Hobbit would like to point out now (and not earlier, as we all have just recovered from brain-freeze and acute attack of attention deficit arising from the FamiLEE saga):

• TPAs’ primary reason for existence is to maximise profits (like any other commercial entity)
• There is much ambiguity in the SMC requirements.
• Indirect regulation of TPAs via SMC is highly unsatisfactory

The first point is obvious. That’s why many TPAs, while removing percentages from the schedules, actually charged more from the doctors and also allowed the doctors to raise their fees. They are there to maximise profits first, then try and save money for their corporate and insurance clients. Nothing wrong with that. But we need to recognise this. TPAs exist to maximise shareholder value (which usually means maximise profits).

The second point is TPAs were prepared to protect or even enhance their margins by eliminating percentages from the charging schedule, but in essence, they were trying to get doctors to skirt the fundamental intent of SMC requirements – which is to prohibit fee-splitting. In the first instance, almost none of the TPAs gave any detailed justification as to how their charges were arrived at on a cost-plus basis. If they gave, it was only the barest and skimpiest one or two-liner justifications.

Some of the TPAs made assurances that actually meant little to the doctors. They told doctors they had consulted their lawyers and their lawyers had assured them their fee schedules were in-line with SMC requirements. The interpreter of any SMC requirement are the Complaints Committee and Disciplinary Tribunals of SMC. The FINAL interpreter of SMC requirements is the Court of Three Judges. If I get hauled up to a SMC Disciplinary Tribunal and get suspended for three to six months, is the TPA going to indemnify me for my loss of earnings, legal costs etc? Not to mention my loss of professional reputation and emotional suffering? Remember, a company can indemnify you for civil damages, but it cannot (and should not) indemnify you financially for the consequences of SMC disciplinary proceedings that are “quasi-criminal” in nature. So as far as this hobbit is concerned, whatever the TPAs’ lawyers said to the TPAs is not worth very much to me unless I am given a copy of the lawyer’s advice in writing. And even then, what redress can I get from the lawyers? They are the TPA’s lawyers, not mine. The lawyers owe a professional duty to the TPA, not me.

This whole episode of last-minute and frantic issuance of advisories and TPA fee schedules and contracts reflects the painful fact that SMC is NOT the correct body to regulate TPA activities and TPAs should be directly licensed and regulated as healthcare institutions. And this hobbit is still wondering why the authorities are so reluctant to do so.

The full weight and risk of this approach of indirect TPA regulation now falls on the doctors and not the TPAs themselves. The uncertainty of SMC’s new requirements, and hence regulatory risk, falls on the doctor, not the TPA. That is why the TPA is willing to take risk by issuing fee schedules that followed the letter but not the substance of SMC’s requirements initially. If the doctor gets hung, the TPA still gets away scot-free (unless the TPA is run by a doctor). It is an unfair playing field manifestly. A simple principle of regulation is that the party who gets the most benefit should be the one that gets punished most severely, but all parties that benefit should be punished. This is the approach taken by MAS (Monetary Authority of Singapore) when they punish both the rogue bankers and the bank if there are money-laundering activities. This was well put by the Managing Director of MAS, Mr Ravi Menon, recently.

But if you take the example of TPA, there is nothing remotely close to this level of thinking. The doctor may get punished severely by SMC, then the TPA changes the way it charges. But can anyone fine or suspend a TPA? Probably not. Who gets the money? Yes, the doctor, but also the TPA. The regulatory risk and downside is fully loaded onto the doctor. TPA – practically ZERO.

Politically it also doesn’t make sense (And this hobbit doesn’t make any comments about politics usually, but he will make an exception here). If the authorities regulate TPAs, they may just displease a few folks who own and operate TPAs. The current regime of loading 100% regulatory risk onto doctors probably irritates and angers thousands of doctors. So the political math just doesn’t add up either.

If you think this is bad, well, things just got worse and darker. We now move into the area of  medical concierge. We are going into pure darkness here. There is no light. We are into the stuff of black holes.

Firstly, medical concierges are not new. They have existed for a long time and there is a role for them, especially for foreigners trying to get medical care here. They help foreign patients find the right doctor, book air-tickets, hotels, service apartments and conduct other support activities etc. They may charge the doctors and/or the patients.

But two new developments have led to a new phenomenon – medical concierges for local patients! One must wonder why would a local need medical concierges since Singapore is so small and connected.

These new developments are:

• Dwindling number of rich foreign patients, due to our high costs and charges in the private sector
• As-charged Integrated-Shield Plans (IPs) (especially those with first-dollar coverage riders)

In the recent past, many of these medical concierges were actually insurance agents. Insurance agents are regulated by the authorities through the regulation of insurance companies (“insurers”). These insurance agents/medical concierges were referring patients to specialists and asking for a percentage-based admin fee, not very much unlike what TPAs were doing.

The authorities then reminded these insurers that their agents CANNOT take a fee for such activities. The agents can get paid commissions when insurance policies are bought and premiums paid, but certainly not for referring patients for episodic care.

So the insurance agents stopped doing so, which is good. But then some agents realised “hey, healthcare fee-splitting for referrals is better business than selling policies!”. Quite a few of them promptly left the insurance industry. They are now full-time medical concierges and no more insurance agents. Medical concierges are completely unregulated.

Apparently, these concierges can demand up to 25% of the doctor’s and hospital bills as admin fees. For example, for one inpatient episode: professional fees may be $10,000 and hospital portion is another $10,000. Total: $20,000. The concierge will ask for 25% which is $5,000. This amount may be split between the hospital and the doctor, or more often than not, paid fully by the doctor (i.e. Out of the $10,000 professional fees portion, the doctor takes $5,000 and splits the other $5,000 with the concierge).

The concierge, who is no longer an insurance agent, may work with his former colleagues in the insurance industry to get a steady stream of patients who bought IPs. The specialist bumps up the professional bills to cover the admin fee, knowing that for IPs that have first dollar coverage and as-charged riders, the insurers will pay what is charged. The patient doesn’t feel the financial pain, the concierge gets paid and the doctor gets paid for work. Nobody gets hurt ostensibly (except the insurer).

Where does the admin fee go to? This hobbit hopes that it only goes to the medical concierge. But if one is intellectually honest, one cannot exclude the mathematical possibilities that the admin fees can also go to the insurance agent and/or the patient, in terms of cold hard cash or just a good meal or even a few cans of abalone or bird’s nest. You never know.

These medical concierges here are also acting as one-man TPAs essentially. They are even more difficult to track than the usual TPAs which are companies. This hobbit is told that several concierges are behaving haughtily in the private hospitals because they bring so much business to them. They are not to be messed around with.

How should the authorities address this new front of medical concierges benefiting from local patients with Integrated-Shield Plans? Should SMC now issue advisories on medical concierges?

Frankly, the answers are obvious. But it is not for this hobbit to say them here.

It’s getting really dark, and maybe it’s time for this hobbit to take Flight NCC 1701 to the Undying Realms.

Mr Toh Han Li, CEO of Competition of Commission of Singapore (CCS) recently said “High prices in itself is not an infringement of the Competition Act…. we are not a price regulator. But it’s important to understand the reasons behind high prices.”

“Sometimes there are situations where players in the market may not have infringed the law, but there are some features in that market which are not making it work as well as it should be and I think the formula milk study is a good example.”

This was reported in The Straits Times on 5 June 2017. The CCS exists to ensure there is competition. But to the average person in the street, having competition is not an end in itself. Prices are. Yes, more competition usually leads to lower prices. But the key word here is ‘usually’. In many cases, it does not. There is no evidence yet that there is collusion or anticompetitive behavior in the milk powder business in Singapore. It appears all that has happened is that several milk powder brands have tried to improve their branding and position themselves as premium products so as to charge higher prices. There is nothing wrong with that. Singapore Airlines has been doing that for decades, and therefore commands premium pricing. Why can’t milk powder companies do the same?

But while this may intellectually satisfy people who dwell on economic calisthenics, the common folk are interested mainly in prices of products and services.

The same applies to healthcare, While the intellectuals and “competitionists” may scream with indignation that SMA’s Guidelines of Fees (GOF) were anticompetitive and hence rightly abolished, experience has shown that private sector prices have risen much faster since 2007 (when the GOF was withdrawn) when compared to the 10 or 20 years when GOF existed. And it is not just the professional fees, but hospital charges as well. Some reckon that private sector bill sizes (professional fees and hospital charges) have risen by about two to three times since 2007.

So where does this leave us? Higher and higher prices spiraling quite out of control, for one. And naturally, a less and less competitive private healthcare sector. It’s quite ironic isn’t it? The GOF was removed to spur competition but instead led to higher and higher prices rendering the sector uncompetitive as a regional healthcare hub. It is no secret that our private hospitals and specialists depend more and more on local patients with integrated shield plans and private healthcare insurance to sustain their earnings while the number of foreign patients continue to drop as a percentage of total patients seen by individual specialists and private hospitals.

Speaking of earnings, it is now time to talk about earnings of doctors vis a vis Third Party Administrators (TPAs). The new SMC requirements for doctors working with TPAs come into effect in days, from 1 July 2017 to be exact.

As expected, all the TPAs this Hobbit knows about have moved away from percentages. Because the guidance from SMC and the Three Professional Bodies (3PBs) was specific – A fixed fee is better and percentages should be avoided. So there are no percentages in the new TPA contracts offered.

But that’s where the good news ends. Many TPAs have taken the opportunity to raise their charges so that doctors have to pay even more to the TPAs. And many TPAs have missed the woods for the trees, or perhaps they have deliberately followed the letter of the law so to speak, but are still making doctors contravene SMC requirements in spirit and soul.

Time for a friendly recap –

Guideline H3(7) of the SMC Ethical Code and Ethical Guidelines (ECEG) states:

1. the quantum of administrative fee should “reflect their (i.e. TPAs’) actual work in handling and processing the patients”
2. “not be based primarily on the services you provide or the fees you collect”
3. “not be so high as to constitute “fee splitting” or “fee sharing” or which render you unable to provide the required standard of care”,
4. “If you pass on such fees to patients, you must disclose this to your patients”.

Here are some examples. One TPA has said it will charge $100 for a Table 1 operation and this goes up by between $100 to $200 per table until it reaches $1000 for Table 6B or above.

Of course, there is no mention of percentages. But doesn’t it smell like it’s still “based primarily on the services you (i.e. the Doctor) provide or the fees you collect”? The TPA does not explain in any detail how the resources and effort spent by the TPA to process a Table 1 procedure goes up by 10 times when it comes to a Table 7 procedure.

Apparently, there was another example whereby a repeat consultation charge by the doctor was $45. The TPA wanted to charge $40 with effect from 1 July, which leaves the specialist with $5!. Naturally, many doctors quit and the TPA had no choice but to revise their charges. But for discussion’s sake, had the doctors not quit and the TPA persisted in charging $40 out of $45, would this not amount to “so high as to constitute fee splitting”?

But nonetheless, the $45 charge-limit remains (and it is $70 for a first consultation). These charges are considerably lower than what the Restructured Hospitals charges for an unsubsidised patient. Which means to cover costs, the specialist has to prescribe drugs and order tests to breakeven (“over-servicing”) – This is the slippery slope that no one talks about.

The mathematics of this is quite easy. A specialist hopefully sees 200 to 300 outpatients a month or 8 to 10 patients a day (25 working days a month and many do not see this number). His rental can range from 10K to 25K a month (depending on whether he shares the unit or not with another specialist). His manpower and other costs come up to at least 15K a month. In other words, his fixed cost (conservatively) is at least 25K a month. It could well be as high as $40 to $50K a month. Let’s say his fixed costs is a modest $25K a month and he sees 250 patients, the cost per patient is about $100 a month, way more than the $70 or $45 for first and repeat consultation this TPA is paying. To make sure he doesn’t lose money from seeing patients from this TPA, the specialist needs to order (maybe unnecessary) investigation treatment to cover costs. And in case you haven’t noticed, he hasn’t even paid himself anything to see this TPA patient!! The $100 fixed cost per patient does not include his own pay!

This phenomenon arises because in trying to secure a particular contract, the TPA has to quote a very low consultation fee. The HR manager or insurance company staff is not wise enough to know that the consultation fee is so low and the TPA charges are so high such that in the end, the scheme is not sustainable unless the patient is over-serviced. In other words, the scheme renders the doctor “unable to provide the required standard of care” – the standard could well be a consultation without ordering investigations or treatment.

It’s a sad state of affairs that is not likely to go away anytime soon even though the new SMC requirements will come into force on 1 July. This is mainly due to four factors:

• Subtle over-servicing is very difficult to prove.
• Lay people are still interested only in (quoted) price (HR managers and Insurance companies who sign up with TPA)
• TPAs only take money from doctors and not from insurance companies or employers
• The authorities are unwilling to regulate TPAs directly and wish to influence them indirectly through the SMC and doctors

The last two points are peculiar to Singapore and hence very important. In most countries, TPAs charge insurance companies and employers as well and not only doctors for TPA services. In Singapore, almost all of a TPA’s revenues comes from the doctors paying them. Obviously, as previously described, there is a strong degree of moral hazard to such one-sided arrangements.

But the biggest problem of all is that at the end of the day, TPAs are unregulated. The common argument is that TPA charges are not a public health or patient safety issue. But if a private sector specialist is only paid $45 or $70 ($60 after TPA fee deduction) for consultation, way below what the restructured hospitals charge (and the same principle applies to GPs and Polyclinics), this will inevitably lead either to over-servicing or poor quality of care- isn’t this already a public health or patient safety issue?

The new fee arrangements proffered by many TPAs clearly demonstrates that TPAs are hell-bent on keeping their profits and margins while paying a cosmetic observance to the new SMC requirements. Doctors are still (if not more) exposed to these new and probably unethical fee arrangements. The attempt to influence TPA behavior through SMC guidelines has not borne real fruit, only the most annoying of obsequious superficialities. One wise gynaecologist compared this approach to a “trans-rectal THBSO” (i.e. theoretically can be done, but hardly the correct or best approach). In short, this approach failed miserably.

Let’s not kid anybody, “no percentages” does not mean there is no fee-splitting. “No percentages” also does not mean that the charges are not “primarily based on the services you provide or the fees you collect”. Let’s not smother ourselves in flaky semantics.

As this hobbit writes this column, the world is agog with stories of cyber-attacks crippling services and companies. One of the worst hit is the British NHS. How important is the NHS? If you would be let to believe, the British, in a poll a few years back consider the creation of NHS to be more important than the defeat of Germany in World War 2. So crippling the NHS is a big deal.

The underlying problem is really that of over-optimisation. In a bid to optimise the operations of the NHS, patient records were all made electronic and centralised. That made it ripe for a mighty cyber-attack. It’s the phenomenon of “optimisation to vulnerability”. One cannot escape this phenomenon. It is a trade-off. The question is whether society is waiting to make this trade-off. In Singapore, this question has not been asked. At least not in the arena of a national electronic medical record.

The techies and IT guys do not usually mention this trade-off. They just want to digitalise everything and put it on the cloud, and everyone lives happily ever after. Well, life is not like that, as the UK and NHS are now finding out.

Also, IT is unique in that the IT guys who designed and then operate the system or software are seldom if ever held liable for cyber-attacks. This is in contrast to other disciplines or commercial activity. A company can be sued for designing or manufacturing a car badly or even just a car airbag badly. In contrast, no one has sued an IT firm for lousy software that is easily attacked and crippled.

So to the guys who are rushing to promote some national software or clinical records under the banner of optimisation of healthcare, let the current NHS incident be a warning to them. Especially to the policy wonks who do not really understand what’s happening on the ground. There is some merit still to having dispersed repositories of medical records as a risk management tool as opposed to putting everything in one big virtual cloud. Centralise (“Cloud-ize”?), optimise and digitize comes with risk and consequences. And the more you do so, the greater the risk and consequences.

In the meantime, horror stories of newly minted specialists unable to secure jobs continue to come in to Hobbit Central. Many have been told they will be offered contracts to continue as resident physicians with terms no better than what senior residents get even though they are now fully qualified and registered by the state as Specialists.

On top of that, in response to the glut of residents exiting specialist training, many hospitals are cutting back drastically on the number of new residents they are taking in. This hobbit was told in a certain discipline, the number of residency places being offered has gone down from 12 a few years ago to now 1 or 2 residents.

Obviously, this boom and bust phenomenon is not making anyone happy. The older exiting residents who cannot get a decent Associate Consultant post or the house officers and junior medical officers seeking specialist training are equally miserable and frustrated.

Some disciplines fare better because they were “disobedient” in the past and refused to accept more residents then they could commit jobs to. Others are really suffering now because they listened to the call to suddenly take in many more residents without thinking through the long term downstream effects. In retrospect, unquestioned obedience isn’t such a good thing after all.

The folks who put in place the policy to open up residency places several years ago are still around, just hiding in some corner. They obviously did not read what Milton Friedman said about money supply. A smooth, steady and slow expansion of money supply is key to generating steady and sustainable growth. Printing more money indiscriminately and quickly just exacerbates the boom and bust cycle and creates much misery later. This hobbit thinks the same principles of a “Monetarist” policy should apply in manpower supply planning. We are obviously seeing the similar poor outcomes now due to the irresponsible and rapid expansion of residency places several years ago.

In the longer run, we should even question not just residency places but the actual number of doctors we are producing. The three local medical schools produce about 600 graduates a year. Another 100 to 200 go overseas for medical studies. While no one owes anyone a living, we should still give priority to attracting our Singaporeans back to practice even though they studied overseas. That’s ~750 medical graduates Singapore has to absorb a year.

Singapore has about 35,000 births in a good year. In other words, every year, we have a cohort of 35,000 Singaporeans. Let’s multiply this number by 2 to include Permanent Residents, foreign workers and even tourists. So we have a “modified” cohort of 70,000. Yes, the population is ageing and we need more doctors. But we are also a small country that does not suffer from the inefficiencies of geographical factors such as providing care in rural and remote areas etc. Many developed countries also have ageing or aged population demographics, so a cohort size of 70,000 is about right.

Most developed countries have (practicing) doctor to patient ratios of between 1:250 to 1:400. UK – 1:369; Netherlands – 1:342; France – 1:305; Denmark – 1:287, Sweden – 1:250, Australia – 1:255; USA – 1:400.

Based on a cohort size of 70,000, if we adopt a generous target of 1:250, we only need to produce or recruit 280 doctors a year in the steady state ONCE we have reached the target of 1:250. If our target is 1:400, then we need even fewer – 175 doctors a year once the target has been attained to serve a cohort of size of 70,000. Yet, we are now producing 750 graduates a year (600+150)

Singapore currently has a doctor-patient ratio of 1:430 (MOH data). If we only include practicing doctors, the ratio is probably closer to 1:470, assuming 1 in 10 doctors are employed in non-practising roles or retired but still registered etc. Again, let us be generous here even though the MOH website states that only about 5% or 600 doctors are not in active practice.

At the rate we are going, we will reach the low target of 1:400 in about 4 to 5 years and maybe the high target of 1:250 in 10 to 15 years, assuming the three medical schools keep producing 600 graduate a year and 150 Singaporeans go overseas to study medicine and return to its shores.

When we are at steady state, what do we do with the 3 medical schools? Even if we take the draconian approach that we do not take in anybody from overseas (even if they are Singaporeans), the 3 medical schools need only produce a total of 175 to 280 medical graduates a year.

To have some economies of scale and to maintain quality, an undergraduate school should produce ideally between 150 to 200 a year and a postgraduate school should have a cohort of about 100.

What are the choices then when we have attained our desired doctor-patient ratio (whether 1: 250 or 1:400 or somewhere in between)?

This would imply one or more of the following

1. We will certainly have to cut down on class sizes in the three medical schools. We may even have to close one medical school
2. We can make medical education an “export” business, which is what some countries do, such as Ireland. But our cost structures are hardly competitive. If we remove the subsidies for the medical schools, the full cost of medical education in Singapore is probably more expensive than UK or Australia.
3. There will be a serious and growing oversupply of doctors locally and all its attendant negative consequences.
4. Medical graduates cannot be trained properly or secure good clinical jobs.

Actually we need to look no further than our neighbour Malaysia. There are now at least 32 medical schools that have set up shop in Malaysia and Malaysians can also get their degrees from overseas, in traditional places such as India or even as far away as in Ukraine.

There are so many medical graduates that they cannot secure house officer positions in government hospitals. There is a waiting list for positions. And even when you do get a house officer job, there are often so many of house officers that each house officer is given just two or three beds to attend to. This is hardly a recipe for good training of junior doctors.

I hope someone in power is thinking about these medical manpower issues now and making the correct policy adjustments and plans in anticipation of the future. The future is often nearer than we think…

Correct answers are in Bold and Underlined with comments in parenthesis 

1          Which of the following local professional organisations is the oldest in Singapore?

1. Alumni Association
2. Singapore Medical Association
3. Academy of Medicine Singapore
4. Singapore Medical Council

2          Which of the following is FALSE about Yong Nen Kiong (“NK Yong”)

1. He is the longest serving President of SMA
2. He writes a weekly cardiac health column for the Business Times ( he writes a wine column)
3. He performed the first open heart surgery in Singapore in 1965
4. He performed the first open heart surgery in Malaysia in 1969

3          Who was the “Agong” of Alumni Association?

1. Arthur Lim
2. Chee Phui Hung
3. Chao Tzee Cheng
4. WC Cheng

4          Which of the following about LMS is TRUE?

1. It was a four-year course and was issued by the KE VII College of Medicine
2. Originally, a LMS graduate was not allowed to take fellowship degrees in UK (i.e. cannot specialise)
3. It stands for Licentiate in Medicine and Surgery and is a recognised basic medical qualification by SMC
4. All of the above

5          Which of the following is the odd one out in terms of place of origin?

1. Soo Khee Chee
2. Foo Keong Tat
3. Kandiah Satku (He is from KL/Klang, the others are from Penang)
4. Tan Seang Beng

6          Which of the following doctors was a paediatric trainee once?

1. Ho Ching Lin (ophthalmology)
2. William Chew (endocrinology)
3. Lee Wei Ling (neurology)
4. All of the above

7          Who was the first local Professor of General Surgery?

1. Jimmy Choo Jim Eng
2. Yeoh Ghim Seng
3. Foong Weng Cheong
4. Ong Siew Chey

8          Which of the following about KKH is FALSE?

1. It once held the (Guinness Book of World Records) record for the busiest obstetric hospital in the world
2. Was the first hospital in Singapore to perform successfully a IVF procedure using frozen embryos (done in NUH)
3. The current hospital stands on a cemetery site and the original address of this site is called 1 Jalan Cemetery
4. It is the first and only public hospital to house a McDonalds fast food restaurant in Singapore

9          Which of the following passed the Part 1 exams of all 3: FRCS, MRCP and MRCOG?

1. Ng Han Seong
2. Benjamin Ong
3. Fock Kwong Ming
4. Chee Yam Cheng

10        In YLLSOM, there is a Wong Niap Leng Medical Bursary; who is Wong Niap Leng?

1. He is/was a Professor of Medicine
2. He is/was a Dean
3. He was the first person who performed liver transplant in Singapore
4. He was the canteen operator of the canteen in KE VII Hall in Sepoy Lines

11        Politically speaking, which of the following is the odd one out?

1. Tan Sze Wee
2. Chia Shi-Lu (He is an elected MP, the rest were Nominated MPs)
3. Benedict Tan
4. Kanwaljit Soin

12        Which of the following is FALSE about Tan Chorh Chuan?

1. He was Dean of Medicine and DMS
2. He is an accomplished poet and has published an anthology of poetry 3 years ago (He is an accomplished Chinese art painter, not poet)
3. He used to be orientation chairman of KEVII Hall (i.e. chief ragger)
4. He played hockey in KEVII Hall as a block fellow after he graduated

13        Which of the following is FALSE regarding Poh Soo Kai?

1. He was the first Honorary Secretary of SMA and a founding member of the PAP
2. He was detained under the ISA for a total of 17 years over two spells
3. He was released from detention after he confessed to being a Communist (He never confessed to being a Communist)
4. He was a grandson of the philanthropist Tan Kah Kee and a relative of philanthropist Lee Kong Chian

14        How much did Arthur Lim take home as the founding director of SNEC?

1. $1,000 a month
2. $10,000 a month
3. $20,000 a month
4. $0 a month

15        The first national specialty centre to be set up in Singapore was

1. National Heart Centre Singapore
2. National Skin Centre
3. Singapore National Eye Centre
4. National Cancer Centre Singapore

16        Which of the following funded a big part of his undergraduate medical education in Singapore by winning a lottery (i.e. 4D)?

1. Yeoh Khay Guan
2. Goh Lee Gan
3. Teo Eng Kiong
4. Fong Kok Yong

17        Which of the following is (probably) the richest doctor in Singapore (by value of shares in publicly-listed healthcare companies)?

1. Lee Hung Ming
2. Loo Choon Yong
3. Ang Peng Tiam
4. Tan See Leng

18        Which of the following is FALSE about TTSH?

1. The first location for TTSH was opposite SGH on Pearl’s Hill
2. Tan Tock Seng, the person, was a Straits Chinese born in Singapore (he was born in Malacca)
3. It set up the first rheumatology unit in Singapore
4. It was originally called the Chinese Pauper Hospital

19        Which of the following is the odd one out in terms of employment history?

1. Ang Yong Guan
2. Paul Ananth Tambyah (The rest were all once “sign-on” regular SAF Medical Officers)
3. Lam Pin Min
4. Lim Wee Kiak

20        Which of the following statements about Gleneagles Hospital is FALSE?

1. After refurbishment, it was opened by Mr Goh Chok Tong
2. The hospital started out as Gleneagles Nursing Home
3. It is 60 years old this year
4. It is named after a valley in Scotland and the valley is populated by many eagles 

The biggest news in the past month is the reclustering of the reclustered 6 clusters into 3 clusters which is leaving just about everyone flustered. So flustered was one Group CEO that it was rumoured he quit stat, like a guy with anaphylactic shock.

If you ask this Hobbit, the 3 clusters formed in this latest exercise makes a lot more sense geographically and operationally. It certainly makes more sense to have this structure than the 6 clusters that was formed just a few years ago. The last cluster, Eastern Health Alliance (EHA) was just formed 6 years ago in 2011. Its formation was formally declared by Minister for Health, Mr Gan Kim Yong, who inherited this six-cluster idea from the previous administration. The other two clusters that are closing shop, Jurong and Alexandra Health are also less than 10 years old. In case you are wondering, the current health minister remains Mr Gan, and that underscores just how briefly this six-cluster gig lasted.

Any organisational structure than involves tens of thousands of people than cannot even last 10 years is a bad idea. For example, do you know how many hours, consultancy dollars it takes to design logos, uniforms, taglines, mission, vision and values when a cluster is formed? And how many more hours of meetings and trainings to get buy-in from the thousands of staff that each cluster employs? And all that investment is now down the drain, not to mention the emotional upheaval that comes along with these clustering exercises.

Take the guys in Changi General Hospital for example. If you ask the longer-serving staff, they were pretty OK with being part of SingHealth in the first place (not ecstatic, but OK). Then they were asked to become EHA because they had to join the movement of creating six regional health clusters. We needed six clusters because it was rumoured another two mega-huge personalities in another cluster couldn’t get along with each other and had to part ways by forming two clusters. And now, they are told EHA is no more and you are back in SingHealth again. Some wry old coot remarked, “Luckily I kept my SingHealth name-tag and employee handbook, maybe no need to issue new one”.

Seriously folks, you can just cry.

The problem is that we should not create organisational structures around personalities., unless you are talking about Christiano Ronaldo, Lionel Messi, Tom Brady or Donald Trump. By doing so, you are storing up problems for yourself and the chickens are now coming back to roost.

And then we have NNI. Just kidding. This Hobbit has absolutely NOTHING to say about NNI. I repeat, NOTHING.

Whew. Yeah, call me chicken-hearted. I am not a dumb cluck like many think this Hobbit is. Let’s move on to other stuff.

Just the other day, I was told of some terrible behaviour by GP locums that need to be addressed.

One GP was told by a locum that for a $100 an hour, he will only see 6 patients an hour. Any more and he needs to be paid more. If not, he will not work faster than see 6 patients per hour even if the waiting room is exploding.

Another locum was worse. He signed up for one week of locum slots with one clinic. After one day, he said he will not take $100/hr and demanded $120/hr instead, if not he wasn’t coming back the following day; effectively blackmailing the proprietor GP (who was already away on holiday).

Thankfully, I haven’t faced such unprofessional locums in my practice. In my opinion, once you accept a locum gig, you are COMMITTED to it at the pre-agreed price. In the first case, if there are less than 6 patients per hour, do you refund some money to the guy who hired you? Of course not! You are paid for your time, not the number of patients you see. True, it may be a tough and busy practice, and you are free to ask for more money the NEXT time they contact you for future slots. But for the current slots, you have to complete them because you have already agreed to. Your word is your bond.

If I may add, these cases are purportedly involving young locums. The general consensus (and I agree) is that decline in professionalism and even clinical standards involve the younger locums.

Maybe it’s the residency system where residents’ workloads are capped to a certain (low) number of patients an hour in the clinics that has led to this mindset of entitlement. SMC should consider adding a section on Unethical or Unprofessional Locum Behavior in the new Ethical Code and Ethical Guidelines. This is the real world, not the make-belief world of residency.

In last month’s column, we talked about the government now self-insuring all doctors in the public sector through MOHH. And how MPS handling of the OG’s indemnity coverage essentially led to the government stepping in for all of the public sector. Well, MPS is now conducting a seminar or forum of sorts called “Making The Right Choices”. This hobbit is confused. Is it meant for doctors or is it meant for MPS themselves? After all, if some geniuses running MPS did not make the choice of unilaterally and suddenly changing the nature of coverage for Singapore OGs, their monopolistic hold in the specialist sector would not have vanished overnight. Talk about hatching a bad idea and making the wrong choice. They are now left with only the private sector business. Board members of MPS should ask themselves if they had hired the right people to manage MPS after this debacle. They can call this the Fall of Singapore Part 2 and look for the MPS equivalent of General Percival. (Well, to be fair to the old boy, at least Percival didn’t self-destruct, he merely surrendered). Are the MPS OG chickens coming back to roost big time now.

It is now again approaching government budget time and it is again time to strut the numbers like how the Sin Ming Avenue cockerel struts his feathers. In FY 2002, Government Health Expenditure (GHE) was S$1,558M or about S$1.6B. In FY 2015, GHE was S$9,247M or ~S$9.2B. For FY 2016, the estimated GHE was S$10,999 or ~S11B. That is an increase of S$1,752M in FY2016 over FY2015. As you can see, the increase from FY2015 to 2016 alone was greater than the whole of what government spent on health 14 years ago. This is a very frightening number. Clearly, while we may have underspent on healthcare in our first 40 years of independence, the spending increases in the last 10 years have more than made up for lost time. Yes, the large increases in MOH spending have led to better working conditions and terms for healthcare staff and better outcomes for patients and all this is great. But still, are such increases sustainable? Or are we again storing up troubles for later?

This hobbit thinks we may have to cull healthcare spending like how NEA wants to cull the Sin Ming Avenue chickens….and it will be a very painful exercise because younger healthcare leaders, managers and staff who work in the public sector now have never experienced the kind of parsimony if not deprivation that older workers had lived with, especially those that have worked in the seventies and eighties.

First, a Happy New Year greeting to all readers of this column. 2016 was a torrid or a great year depending on where you came from. It was a bad year for Star Wars fans as Carrie Fisher is now One With The Force, unlike Donnie Yen who is very much alive muttering the same two-liner incessantly in the movie. Frankly, he should have spoken with a Martin Yan accent when he played his blind Rogue One character. (“Yan can cook, but Yen cannot look”).

Puns aside, Rogue One was a good Star Wars movie because

• For once, everybody died, including the smart-ass robot
• There were no crass efforts to merchandise everything
• There are plot loopholes as big as Sarlacc’s mouth, like in all other Star Wars movies

2016 was a good year for Donald Trump, Kim Jong Un and Boris Johnson, because bad-hair days are now de rigueur among the elite and the establishment.

Going forward, what does 2017 hold? This Hobbit is no fortune-teller, but he will hazard a few predictions. It’s the year of the Rooster in the Chinese Almanac and yes, this is the year many of our chickens come home to roost.

2017 will be the year that many residents will exit as specialists. And the picture is not good. We hear horror stories of many newly-minted specialists unable to secure jobs in the restructured hospitals (RHs). And we are not just talking about certain specialties only; it is across the board. Popular and “lucrative” disciplines such as ENT and Eye are grappling with this problem too. Apparently, there is an instance of 4 ENT residents exiting in 2017 from one institution and only one was offered an Associate Consultant (AC) contract. There are dozens of ENT and Eye residents exiting over the next two to three years that probably will have no AC jobs. And if you extrapolate to other disciplines, the number must be in the hundreds.

These newly-minted specialists who will not get AC contracts have 3 options:

• They stay on and remain hired as Service Registrars while bearing the professional responsibility of specialists.
• They leave for the private sector, either working for more experienced specialists or open up practice in an already-saturated market and without sufficient experience to run a practice independently
• They can do something else, like open a bakery or café, like what quite a few lawyers have done. But unlike lawyers, they have spent four to five years undergoing postgraduate training for something that they now have to ditch.

This Hobbit once wrote about the Residency Turkey quite a few years ago. Well, the Turkey has been eaten and now it’s time to manage the Residency Chickens that are coming home to roost.

Current leadership is not responsible for this mess for sure. The guys who are have flown the coop long ago.

The legal profession and the Law Minister were quick to react when they sensed too many people were going into law. But there is no such apparent deftness in MOH or SMC and things are going on business as usual. People are still rushing to medical school overseas if they cannot get a place in a local one and the local schools are still churning out about 500 medical graduates annually and of course when you have so many graduates, you have to offer more specialist training positions.

MOHH and the RHs are also still actively recruiting specialists from overseas to exacerbate the problem of a glut in junior specialists.

The crux of the problem is that unlike in the past, the people who fund training are NOT the folks that hire specialists. MOHH is the funder and the employer of residents and they can create and hire residency positions that RHs welcome (“free or cheap labour”). But once that is done, the newly-minted specialists have to be funded from the operating budget of a RH and they become “expensive and inexperienced labour”. Instead of hiring an AC and training them to “full” consultant, some RHs prefer to hire full-fledged consultants from overseas.

It is true that no one owes anyone a living. Residents cannot all expect to get AC contracts as a fait accompli from the RHs. RHs should not be under compunction to offer AC contracts to all exiting residents. But when the number of residents who do not get an AC job outnumber those that do, it means more than that. This is a systemic problem that requires a comprehensive solution, not superficial band-aid solutions that the residency system represented, which in turn has created so many problems of its own now downstream.

Another bad idea that was hatched by some feather brain was in the area of medical indemnity. Some wise guys in MPS (Medical Protection Society) thought that they could pick and choose what they offer Singapore doctors. About a year ago, MPS unilaterally changed what they offered obstetricians from an incidence-occurrence product to a claims-made one. This led to a big uproar in the community and some senior OGs giving up obstetrics altogether. These bean counters probably thought they were the smartest folks under the sun, and that they could cherry-pick what they want to offer us natives here – they could minimise the losses or preserve the margins for the OG sector using a claims-made product while still offering incidence-occurrence plans to the rest of the medical profession here. Someone made decisions based on counting their spreadsheet chickens even before the eggs hatched.

Guess what, they obviously haven’t seen The Empire Strikes Back (In this Hobbit’s opinion, still the best movie in the Star Wars franchise) or understood that seemingly clever decisions have what we call “negative externality effects”. And the externality effects this fateful decision has triggered are both great and negative for these bean counters. Starting this year, the RHs have decided to buy medical indemnity insurance for all their doctors. The already did so for the junior doctors, but now it has been extended to all doctors, including specialists. MPS will probably lose tens of millions of premiums annually arising from this, beginning in 2017. It’s actually a good thing in the long run because it sends a clear message to any medical indemnity provider that The Empire will strike back if need be.

There are lessons to be learnt from this episode. First, gone are the days when you can just sail in and out of our little island deciding at a whim what we primitive natives have to take from you.

Secondly, if you are a mutual or sort-of cooperative, behave like one. Don’t behave if you just another commercially-run, bean counter-dominated organisation. As anyone will tell you, doctors generally dislike bean counters.

Thirdly, while public sector employees almost never look for more work, sometimes their hand can be forced. In this case, the sudden realisation that indemnity product coverage in Singapore can be changed overnight by a foreign indemnity provider (which is not even subjected to regulation as an insurance provider in Singapore by the relevant authorities since they do not even have an insurance license here) have forced them to at least for now ring-fence the public sector from such vagaries with their own in-house plans. The public sector has the will, scale and resources to do so when their feathers are sufficiently ruffled.

The next big question is- will this new arrangement be extended to the private sector as well? Or will there be new entrants into this market?

We will talk about more chickens that are coming home to roost next month. And yes, this Hobbit promises more chicken-related bad puns. Cluck, cluck….

November has been a testy month for the healthcare community. Firstly, there is this unsavoury (depending on your position, it could also be ‘savoury’) revelation that the National Kinky Foundation (NKF) has removed its male CEO due to some personal indiscretion with a male employee. You can bet your kidneys that subtle warning signs have been there for some time. But as usual in our compliant culture, no one speaks up till it’s too late…. And then there is a lot of cleaning up to do by then.

Next on the list is this revelation that the SMC is still deliberating about how to implement or operationalise certain parts of its new Ethical Code and Ethical Guidelines (ECEG). In an article in The Straits Times on 18 November 2016, it was reported that the SMC “are deliberating this matter at present and will be providing clarifications to the doctors in due course” when it was asked if doctors can continue to pay Third Party Administrators (TPAs) a percentage of their fees.

There are a few things one must note about the new ECEG. Firstly, the new ECEG which will come into force on 1 Jan 17 is a document that is to be fully implemented. It is not just an aspirational document merely stating niceties and lofty ideals. Every sentence therein will be used by SMC or patients’ lawyers to secure a conviction when the occasion arises. There is nothing wrong with that, because that’s what lawyers are trained and supposed to do in real life.

So every word in the ECEG needs to be carefully thought through. What are its exact legal implications? The sentence in the new ECEG on TPA fees, “Such fees must not be based primarily on the services you provide or the fees you collect and you must not pay fees that are so high as to constitute ‘fee splitting’ or ‘fee sharing’” has opened up the question of what exactly is “primarily”? It’s a good question and it needs to be answered clearly.

Unfortunately, no one knows the answer because SMC is still deliberating. It’s unfortunate. It’s embarrassing even. One should not issue a new ECEG and be still deliberating what a key paragraph or word therein actually means in real life.

It would have been far better if someone had the gumption to ban percentage-based fees entirely. No “primarily”, “secondarily” or “tertiarily” woozy, iffy stuff. Draw the line in the sand. Instead, now everyone is tied in knots awaiting the outcome of the deliberations. There is no guarantee that the outcome of the deliberations will be clear, useful and simple guidance or clarification. It may be “primarily means primarily, not “pre-“ or “post-primarily”. By which time, doctors and TPA administrators may have slit their carotids in frustration. Some wordsmiths communicate, others obfuscate.

This is like what one of my old consultants used to say – “half-pregnant” situations – there is no such thing as half-pregnant, you are either pregnant or not.

Secondly, there is this tea-room talk that some parts of the ECEG will be applied with a light touch, specifically the bits on TPA fees. This hobbit does not find this argument convincing.

Old laws and guidelines may be applied with a light touch because they have become a bit out of date and current situations and context have evolved. The old laws and guidelines need revision in due course but perhaps not immediately. Or they may be removed for good eventually. But these considerations do not apply to new laws and guidelines. New laws and guidelines are new precisely because they have been drafted and implemented to address new situations. While one may delay the implementation of these new laws so that people are given more time to be aware, this delay is at best temporary. Likewise, a light touch may be applied initially because awareness is lacking, but again this is only for a short time. A light touch cannot be maintained indefinitely for new laws and guidelines. The intent must be to enforce new laws and guidelines fully. If not, then why should they be promulgated in the first place?

Since we are on the subject of TPAs, we now go on to the attempted IPO (Initial Public Offer) of a Managed Care Company and TPA – Fullerton Health. Many of us in the medical profession are familiar with this company. Apparently they had wanted to IPO the company with a valuation of about $1.1Billion. That’s in Singapore Dollars, in case anyone is wondering.

According to another The Straits Times article published on 21 Nov 2016, Fullerton Health has “called off plans for a share market listing following the long delay generated in part by anonymous complaints about the medical firm’s business model”.

Apparently, there were many queries and poison pen letters and “The complaints centred largely on how the firm takes a 15 per cent cut of doctors’ fees under its managed care services”. According to the Group CFO, the complaints were “surprisingly repetitive”

It was reported in  The Straits Times article that the IPO was called off as the company had wanted to have the company shares traded on the Singapore stock exchange before the American Presidential Election.

It is highly unusual for any IPO to be called off because of poison pen letters and complaints. According to a Business Times article published on 24 November 2016, only five IPOs have been sunk by poison pen letters since our stock exchange adopted a public scrutiny process as part of its IPO framework 14 years ago. So it is a rare occurrence.

This Hobbit hopes that Fullerton will attempt to IPO again on the Singapore stock exchange. Our languid stock exchange will benefit from a big IPO; and healthcare companies are often investor’s favourites. Still, it would be interesting to note whether Fullerton’s business model will remain the same (charging a percentage) or change as a result of the SMC’s new ECEG. Many doctors and investors should read the new or updated prospectus with great interest when an IPO is attempted again.

Meanwhile, there are poison letters that have no merit, and there are those that have. This Hobbit does not think that completely unfounded claims will be taken seriously by the stock exchange or regulatory bodies. It is really up to healthcare companies who wish to IPO in Singapore to really examine if their practices stand up to not just business standards but also the healthcare industry’s ethical considerations and requirements as well.

Finally, as we are nearing the end of another year,  we should be in a more charitable and philosophical mood – the quote for the day comes from a senior lawyer who was quoted in the aforesaid Business Times article, “The practical side of things is, try to make peace and don’t make enemies.”

Happy holidays!