As reported in The Straits Times, MOH recently published data that showed Integrated Shield Plans (IPs) varied widely in terms of coverage and lifetime price (Integrated Shield Plans lifetime premiums vary widely across insurers, MOH comparison shows” (1 July).

This is hardly surprising and shows that there is some form of competition between insurers and collusion does not exist, which is good.

However, as Saw Swee Hock School of Public Health Associate Professor Wee Hwee Lin noted, “This is clearly useful for people to review their existing insurance policies but with caveats. It is not possible for people with existing medical conditions to switch providers.”

Price is easy to understand, but coverage less so. As journalist Ms Salma Khalik noted in the above article, “To confuse matters further, the lowest coverage may not come from the insurer charging the lowest premiums”.

Understanding coverage requires much more technical knowledge and research effort than comparing price or premiums.

Or for that matter how insurance companies operate.

To understand this, the hobbit would like to point you to another Straits Times article published on 19 June 2024 written by a CEO of a financial advisory firm, “When it comes to financial advice, do your own homework” (by Chuin Ting Weber). This hobbit must confess that he has found this to be one of the most illuminating articles published this year. Here is what she wrote,

“The truth, or the whole truth?

Financial advice, like medicine and law, is a licensed profession, Professionals know more than the people they serve. Often, clients don’t know what they don’t know. This knowledge asymmetry imposes an ethical responsibility on a financial institution (FI) and its representative to go beyond basic honesty, to care about their clients’ interests.

How far this responsibility goes, however, depends on the standard applied. In Singapore, FIs are held to the “suitability” standard (emphasis mine); financial products recommended must be appropriate to the consumer’s financial situation and goals…..

….However, this still falls short of a higher “fiduciary” standard adopted by some countries. A fiduciary must make recommendations in the best interest of the client, even if it means decreased remuneration for the FI or the adviser”.

She then gave the example that a retiree seeking a stream of income was given a recommendation by a financial adviser or FI to buy an insurance product when she should have gone for a higher CPF Life payout by getting the retiree to top-up her CPF Retirement Account. Recommending her to buy the insurance produce was not untruthful, but “the more complete truth” would be recommending her to consider topping up her CPF Retirement Account.

She adds “If fact, FIs can even argue that their advisers should not do that (recommending the retiree to top up the CPF Retirement Account). Because while their responsibility towards the consumer (i.e. the retiree) is on a suitability basis, their responsibility towards shareholders is on fiduciary basis”.

After reading this article, this hobbit was deeply troubled. But this also explains why the medical profession is often at logger heads with the insurance companies and the twain shalt never meet (at a place of peace) given the gulf in fundamentals.

Doctors owe a duty of care to our patients. This is to be found in the SMC Ethical Code and Ethical Guidelines. In reality, duty of care is really fiduciary duty in medical-speak. That means we must do our best and put the interests of our patients before our own interests.

On the other hand, Financial Institutions (all insurance companies that sell IPs are FIs licensed by the Monetary Authority of Singapore) puts the interests of its shareholders above that of its customers. As aforesaid by Weber – the FI owes a fiduciary duty to its shareholders but not to its customers/policyholders; it only has to offer “suitable” insurance products to its customer, which may not be in their best interests.

When “suitable” is not good enough

Contrast this to an actual case that went before SMC and the Courts. In 2017, a prominent private sector oncologist was suspended by the Courts for 8 months after an appeal was filed for a SMC case. In fact, the Courts said that had it not been for the long delay by SMC to hear the case, the suspension would have been 16 months.

What did this oncologist do to be punished so heavily? Answer: He had “wrongly held out false hope” to the family by claiming that there was a 70% chance of the cancer patient responding to medical chemotherapy and for not offering surgery as the preferred option for treatment of the patient’s cancer.

That is not to say that chemotherapy was quackery. In this case, chemotherapy was an accepted form of treatment. It was just that surgery was supposed to be better and it wasn’t offered as an option for the patient to consider.

Now if the standards of regulation for FIs were applied to this oncologist, he probably would have gotten away with offering chemotherapy as the (only) option although he may be still found to be guilty of giving the patients’ family false hope.

This is because while surgery was the better option, chemotherapy cannot be considered to be unsuitable; similar to the logic behind the example given in the abovementioned Straits Times’ article – topping up of the CPF Retirement Account was the best option, but recommending the retiree to buy an insurance policy was also “suitable”.

We owe a fiduciary duty or duty of care to our patients, while FIs and financial advisors and insurance agents only need to offer something that is suitable. Which is also why Weber recommends that when it comes to the matter of financial advice, do your own homework!

A wise crack may counter that isn’t it the same with subsidised healthcare in our public healthcare institutions (PHIs)? As a subsidised patient, one has no right to choose their own attending specialist physicians. The hospital will just assign you a specialist. It’s your good luck if you get assigned the professor or Head of Department. Tough luck if you get assigned an Associate Consultant instead. Certainly, an Associate Consultant is “suitable” (because he is indeed a specialist), but he or she can hardly be considered to be the best option the PHI can offer.

Well, there is a difference here. If the case turns out to be complex and beyond the abilities of the AC, he is also duty bound to seek the input of a more senior specialist or even refer the patient to the more senior specialist. This happens at no extra cost to the subsidised patient. If the case is simple and does not warrant the input of more senior specialists, then it can be argued that the outcome is likely not to be significantly different whether the case is handled by an AC or a SC.

The FI test of suitability is a tradeoff between enriching self (the shareholders of the FI and/or the financial advisor) and doing what is best for the policyholder. This is in contrast to the duty of care or fiduciary duty that we owe our patients whereby enriching oneself at the expense of the best interest of one’s patient is NOT allowed.

The triumph of the standard of suitability

Now let us look at another real-life example in the form of an incident involving medical oncology that has happened recently. A medical oncologist was dropped from a preferred provider of an IP panel. No reasons were given, as usual. Any IP insurer will tell you that they don’t have to give any reasons whatsoever for including or dropping a doctor from their panels.

This oncologist began to reflect over why was she (and her colleagues in the same practice) dropped by the insurer. She had heard from reliable sources that her group’s rates were quite reasonable and in fact, she hadn’t raised her rates for 5 years.

She surmised that the reason she was dropped was that she had sometimes used cancer drug treatments which are not on the MOH’s Cancer Drug List (CDL) on a few patients after conventional drug treatments had not worked. She is a domain expert in her area and often gets referrals from other doctors for difficult and complex cases. When the usual options are not effective, she would try something not on the CDL if the patients had bought riders that explicitly allowed for such use (Class A to E of Non-CDL Treatments) as described in the circular issued on 2 September 2022 by the Life Insurance Association, Singapore (LIA). In some of these cases, due to the high cost of treatments, she has often given discounts as well.

If what she suspects the reason behind her being dropped by this insurer is true, then this is a good example of what can happen when fiduciary duty meets the test of suitability. She had tried doing what she thought was best for the patient, given the patient’s dire situation and what the patient’s IP policy is supposed to cover. But by doing so, she will suffer financially going forward because she is no longer a panel doctor with this insurer, i.e. her patient’s best interest has been served at a loss to herself.

On the other hand, the insurer, despite providing coverage for non CDL treatments, may also be sending out a message to other panel doctors that they do not encourage doctors from trying their best (even when it is permitted under the terms of the policy) but instead should just do what is suitable and sufficient, and that the interests of the insurer come before the patient.

The suitable slope to perdition

The future of medicine in especially the private sector will therefore be a contest between a doctor trying to fulfill his duty of care/fiduciary duty to the patient and also funders of healthcare such as insurers trying to impose a lower standard of “suitability” on doctors. The balance of power is clearly on the side of the insurers because they control the funding and they are also accountable to no one on how doctors are chosen to be put on or dropped from preferred provider panels.

In the short term, this is not a bad thing because if everyone just dishes out suitable care, healthcare costs will probably be lower and therein lies the temptation. But in the long run, the patient will suffer as doctors align themselves with their funding masters –  the insurers. This is because the obvious knowledge asymmetry between insurers, providers on one side and the patient/policyholder on the other side is so great that it is not easy for the patient/policyholder to discern he has been given just “suitable” care instead of the best care that owing a fiduciary duty/duty of care requires.

Clearly, in the face of the enormous power and financial resources wielded by FI insurers that are only expected to operate on the standard of suitability, doctors in the private sector must align themselves with the insurers to survive. The tenet of duty of care that we teach in medical schools and to our young resident doctors must eventually yield to such great a countervailing force (of the insurers and their test of suitability) when many of them leave for the private sector.

And before we know it, we may already be well on a fast and slippery but surely suitable slope to perdition.

POSTNOTE (Dated 23 Aug 24): since the publication of this post, a lawyer, presumably linked to the case involving the oncologist that was quoted in this article has contacted SMA more than once with regard to what he or she considers to be a factual error in this post. This lawyer (with reference to the Disciplinary Tribunal’s findings and the C3J’s Decision) has stated that the use of the word “preferred” is incorrect to describe surgery as an option and that the adjective used should be “viable” instead.

There are a few things that need to be stated or restated here

This hobbit was merely quoting the mainstream media (aka The Straits Times) when he used the word “preferred”. Instead of asking lowly me to correct this word, maybe the mighty Straits Times should be asked to make this correction instead. (The news article was published in 2017 and written by Ms Salma Khalik). https://www.straitstimes.com/singapore/health/prominent-cancer-doctor-ang-peng-tiam-given-8-month-suspension-by-supreme-court

All readers should also note for historical reasons, this hobbit is known as “hobbitsma”. But really, this hobbit has been an independent blogger for years and this is clearly stated in the first post on this wordpress platform. So while certain equally old coots in SMA know how to contact me (usually by smoke signal or using the middle-earth equivalent of a mail pigeon), SMA doesn’t tell me what to write or not to write.

Finally and most importantly, the main subject matter of this post is comparing the test of suitability with the duty of care or fiduciary duty doctors owe their patient. And really, it doesn’t matter whether surgery is “viable” or “preferred”. The crux of the matter is that under the duty of care he owes the patient, the doctor would be found wanting if he had not offered surgery as an option, whether surgery was viable or preferred is irrelevant to the outcome at the SMC or C3J level. On the other hand, under the test of suitability, the doctor would probably be found to be OK if he had only offered chemotherapy as the only option offered because chemotherapy is a “suitable” option. Under the test of suitability, one does not have to offer ALL suitable options; the doctor has to offer only one – and that was the thrust of the ST article by Weber.

Therefore, the key point of this hobbit’s discussion that affects the outcome of this case is NOT whether surgery is a viable or preferred option, but which test was applied or is applicable – Duty of Care or Test of Suitability.

So, really, this Postnote is unnecessary. But I have to write this to get my life back. Maybe it is about time to retire and sail off to Valinor