Unbiased Analysis of Today's Healthcare Issues

Singapore’s Health Care system

Written By: Jason Shafrin - Jan• 14•08

Bryan Caplan of EconLog has an interesting blog post on Singapore’s Health Care System. In the post, he reviews Ghesquiere’s “Singapore’s Success,” analyzing Singapore’s health care system.

Harford finds that Singapore spends a third of what the U.S. does on health care (as a percentage of GDP) yet has better health indicators. Of course, much of this may be attributable to lifestyle differences rather than a superior health care system. Nevertheless, the Singapore system has some very interesting characteristics:

  • There are mandatory health savings accounts: “Individuals pre-save for medical expenses through mandatory deductions from their paychecks and employer contributions… Only approved categories of medical treatment can be paid for by deducting one’s Medisave account, for oneself, grandparents, parents, spouse or children: consultations with private practitioners for minor ailments must be paid from out-of-pocket cash…”
  • “The private healthcare system competes with the public healthcare, which helps contain prices in both directions. Private medical insurance is also available.”
  • Private healthcare providers are required to publish price lists to encourage comparison shopping.
  • The government pays for “basic healthcare services… subject to tight expenditure control.” Bottom line: The government pays 80% of “basic public healthcare services.”
  • Government plays a big role with contagious disease, and adds some paternalism on top: “Preventing diseases such as HIV/AIDS, malaria, and tobacco-related illnesses by ensuring good health conditions takes a high priority.”
  • The government provides optional low-cost catatrophic health insurance, plus a safety net “subject to stringent means-testing.”
  • Almost all care is subject to significant co-pays.

Regardless of your stand on universal health care, instituting co-pays is an important means to control cost. Nobel Laurette Muhammad Yunus agrees with this statement, even applying this to principle to developing nations, “I think it’s very important to have the patients, the people who are asking for health services, to pay.” (see 26 March 2007 post)

You can check out my own review of East Asian health care systems here.

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4 Comments

  1. […] Poor individuals who need more liquid asset will not be able to take advantage of the HSA.  Singapore has a mandatory HSA in which funds are automatically are deducted from one’s checking account.  I am generally […]

  2. […] are some more details on how Singapore’s system works: * There are mandatory health savings accounts: […]