to improve the lives and health of their citizens.
Finally, I thank Dave Conti for his valuable editorial assistance and constant input throughout the writing of this book.
William A. Haseltine Washington, DC, April 2013
Introduction
Why this book? Affordable Excellence tells the story of the Singapore healthcare system, how it works, how it is financed, its history, and where it is going.
Today Singapore ranks sixth in the world in healthcare outcomes well ahead of many developed countries, including the United States. The results are all the more significant as Singapore spends less on healthcare than any other high-income country, both as measured by fraction of the Gross Domestic Product spent on health and by costs per person. Singapore achieves these results at less than one-fourth the cost of healthcare in the United States and about half that of Western European countries. Government leaders, presidents and prime ministers, finance ministers and ministers of health, policymakers in congress and parliament, public health officials responsible for healthcare systems planning, finance and operations, as well as those working on healthcare issues in universities and think-tanks should know how this system works to achieve affordable excellence.
The lessons from Singapore should be of interest to those currently planning the future of healthcare in emerging economies, for Singapore was not always rich. In just 50 years, Singapore transformed itself from a low-income country to one that has one of the highest per capita incomes in the world, from a country with poor health outcomes to one of the best in the world. What was the philosophy and what were the key decisions that drove this transformation? Leaders and policy planners may well ask—will this work in my country?
One point that emerges clearly: decisions made early on affect the course of later history. Once begun, it is very difficult to revise health finance and delivery systems, as such decisions profoundly affect the lives of individuals and economies. To finance healthcare, should countries adopt a mixture of private and public insurance as does the United States, the state approach to healthcare finance and operations as in the United Kingdom, or the public–private partnerships of Germany and Japan? Or should an entirely different approach be taken, that of Singapore, where emphasis is placed on individual responsibility supported by an enabling state? Affordable Excellence describes the Singaporean approach as an alternative well worth considering.
Singapore also offers useful lessons for wealthy countries with long-established healthcare systems. The world's most developed countries are facing a crisis of confidence in their healthcare systems. Costs are rising at an alarming and seemly uncontrollable rate. In the United States, healthcare accounts for almost 18 percent of the GDP and is rising. Most developed economies are facing twin demographic problems: the population of the elderly is rising rapidly and the population of the young, who must support them, is shrinking. The cost of caring for the elderly far exceeds that for the young. Yet as earning power declines with age, it is not compensated for by increased earning capacity among the young.
The Singapore system offers a guide to controlling costs and paying for health in the present. It may also provide a blueprint for the future. Singapore is relatively unique amongst governments in its ability to plan for the future. In the past, the government has planned and successfully executed, over a 30-year period, strategies requiring the integration of the activities of most government ministries. That is how the current healthcare system was designed and built. Today, the emphasis is on planning for the coming demographic crises using the same cross-ministry approach that has worked so well in the past. How can the current system be adapted to provide excellent care for the elderly at a cost the country can afford? This is the central issue for all developed economies. Those planning for the future might well look to Singapore for ideas on how to prepare for the challenges ahead.
I was surprised to learn that no book describing the Singapore healthcare system has been written. To be sure, aspects of the system are described in many monographs and books that treat more general topics. Affordable Excellence provides a source for those wishing a more comprehensive knowledge of how the system was built, financed and operates. In writing this volume, I have often been told that Singapore is unique and lessons learned are not applicable elsewhere. Some say Singapore is small and solutions to problems there will not work elsewhere. Others believe only a government with a long tenure in power (Singapore's ruling People's Action Party has been in power since independence in 1965) can achieve comparable results. Some even go so far as to describe Singapore as a dictatorship—an inaccurate characterization in my view—and that such a healthcare system can only be imposed by a controlling government. My answer to these challenges is that I am a scientist trained to look at what works. We call working examples “proof of principle.” The Singapore experiment does work, proving that healthcare systems can be designed that provide high-quality healthcare to all citizens in a highly-developed economy at a cost the economy can afford, and that costs can be controlled while delivering excellent service. True, the continuity and long-term perspective that come from political stability may make it easier for a government to develop a strong healthcare system (see next chapter); nonetheless, Singapore has much to teach health systems no matter what their political context.
CHAPTER 1
The Singapore Healthcare System: An Overview
Singapore has achieved extraordinary results both in the high quality of its healthcare system and in controlling the cost of care. In per capita terms and as a percentage of Gross Domestic Product (GDP), its health-care expenditures are the lowest of all the high-income countries in the world.
How did this happen? How has Singapore been able to achieve these kinds of results?
The answers are bigger than just the process of putting a healthcare system together. There are larger factors that have to do with the spirit and philosophy of Singapore itself, the way it is governed, how the government approaches domestic issues, and how it deals with the world.
In my study of Singapore, I have found three compelling qualities woven into the fabric of the country that have enabled it to achieve outstanding successes in so many areas, healthcare included. They are long-term political unity, the ability to recognize and establish national priorities, and the consistent desire for collective well-being and social harmony of the country.
Political Unity and Constancy of Purpose
From the time the British withdrew from Singapore and left its former colony to fend for itself, Singapore has been able to develop and grow as an integrated whole. The People's Action Party (PAP) has been in power since independence, resulting in sustained political stability. Along with stability has come a unity and constancy of purpose and action throughout government. Contrast this condition with other countries where government regularly changes hands and different parties espousing different agendas go in and out of power. A clear and uninterrupted approach to solving a nation's problems is very difficult to achieve in such situations. The government has been steady in its broad general vision of what care should be and what role it should play in the lives of Singaporeans. That continuity of philosophy and approach, I believe, has made possible the ability to plan and execute over a long period of time.
I have also observed an unusual degree of unity among the country's various ministries—an acknowledged spirit of cooperation among governmental departments that makes possible the formulation of policies that reaches across ministries. A member of the team that assembled the 1983 health plan discussed in this chapter and Health Minister from 2004 to 2011, Mr. Khaw Boon Wan, has noted that each month, Permanent Secretaries of each ministry meet to focus on issues that require participation by more than one ministry.1 It is simply assumed that ministers will work as a team on issues that need interdepartmental cooperation.
I find it relevant that the government realized early on that improvement in health conditions and care had to be approached as an integral and inseparable part of the overall development planning for the country. As a heavily urbanized city-state with a population of two million at