Implementation of Means Testing

• Abstract
• Characteristics of this policy
• Purpose and process analysis
• Expected outcome
• References

Abstract

The Health Ministry has announced it will use Means Testing to determine eligibility for government subsidy of hospitalization costs from January 2009. The key idea behind means testing is so that government subsidies go to those who need them most.

Neue Entwicklungen

The idea of determining eligibility for government subsidy of hospitalization costs based on actual income rather than on choice of ward class was first mooted in 2004 (see survey (3) 2004). The Health Ministry had been monitoring hospitalization trends over the years and was concerned that many who can afford better classes of wards have been choosing to be admitted to the heavily-subsidized C and B2 class wards, sometimes crowding out lower-income patients. But the major obstacle to mean testing was the uncertainty that surrounded the implementation details: what parameters to use? Will the income cut-off points be acceptable to the public? Will implementation will be onerous for those affected? After several years of public dialogue and internal deliberation, the Health Ministry has finally announced it is ready to implement Means Testing from January 2009.     

With this  announcement, the cut-off monthly salary for enjoying the full subsidy at public hospitals has been fixed at Sing$3,200.  Monthly income is defined as average monthly wage based on the last available 12-month data. Those with no income, e.g. housewives, retirees and children, and those living in government-subsidized Housing Board apartments or properties with annual values of Sing$11,000 or less, will continue to get the full subsidy of 80 per cent in C class wards and 65 per cent in B2 class wards. With these assumptions, the government estimates that 80% of Singaporeans will hardly be affected.  

Rising from the base of Sing$3,200 monthly salary is a detailed sliding scale of declining subsidies according to individual income. In other words, the higher up the salary scale, the smaller will be the subsidy entitlement. (see Table 1). The graduated subsidies are between 50-65% for Class B2 and between 65-80% for Class C.  Those earning $5,201 or more will continue to enjoy subsidy of 65 per cent in a C class ward and 50 per cent in a B2 class ward. The subsidies for permanent residents, who are non-citizens, will be 10 percentage points lower than for citizens (see survey (9)2007).    

See below: Table 1 - Parameters for Means Testing in Public Hospitals 

Innovationsgrad	traditionell		innovativ
Kontroversität	unumstritten		kontrovers
Strukturelle Wirkung	marginal		fundamental
Medienpräsenz	sehr gering		sehr hoch
Übertragbarkeit	sehr systemabhängig		systemneutral
current    previous

The key motivation behind means-testing is to better target limited subsidies at the lower income group. Government has promised that the additional revenue derived from the reduced subsidy for the higher income group will go towards subsidising the lower income group. Patients who cannot afford the current B2/C subsidy will get additional financial assistance, through Medifund.  Persons aggrieved by means-testing will have his or her case re-assessed on a case-by-case basis.  

The government's pledge to be flexible at the margins and "err on the side of generosity" provides the key to non-contentious, fuss-free implementation.

Purpose and process analysis

Current Process Stages

	Idee	Pilotprojekt	Strategiepapier	Gesetzgebung	Umsetzung	Evaluation	Veränderung/Richtungswechsel
Implemented in this survey?

Initiators of idea/main actors

• Regierung: The government holds the view that no matter how much of the government budget is allocated to healthcare, it will always be limited. So the government’s aim is how best to stretch that money to those who really need help.

• Leistungserbringer

• Patienten, Verbraucher

• Bürgergesellschaft

• Politische Parteien

Actors and positions

Regierung
Minstry of Health	sehr unterstützend		stark dagegen
Leistungserbringer
public hospitals	sehr unterstützend		stark dagegen
Patienten, Verbraucher
Patients/Consumers	sehr unterstützend		stark dagegen
Bürgergesellschaft
Civil Society	sehr unterstützend		stark dagegen
Politische Parteien
opposition members of parliament	sehr unterstützend		stark dagegen
current    previous

Actors and influence

Regierung
Minstry of Health	sehr groß		kein
Leistungserbringer
public hospitals	sehr groß		kein
Patienten, Verbraucher
Patients/Consumers	sehr groß		kein
Bürgergesellschaft
Civil Society	sehr groß		kein
Politische Parteien
opposition members of parliament	sehr groß		kein
current    previous

Positions and Influences at a glance

Adoption and implementation

To be implemented in January 2009.

 

Table 1 - Parameters for Means Testing in Public Hospitals

Monitoring and evaluation

Some community and union leaders as well as members of parliament have called for household income instead of individual's monthly income to be used for means testing. The Health Ministry has, however, explained that monthly income was being used because  government had felt it would not only be tedious and time-consuming, but intrusive to check the entire family's income for one individual's short hospital stay. Singapore's public sector hospitals see more than 200,000 subsidised patients each year, mostly for just a few days at a time.

Expected outcome

Eager that the system should be relatively quick and fuss-free when implemented, the Health Minister has given the assurance that 'We will be flexible at the margins to help those who may appear to be of high-income, but who have exceptional financial liabilities.'   Government is also hoping that with means testing, many who earn more than $3,000 a month and are currently under-insured, will buy private insurance cover.

Impact of this policy

Qualität	kaum Einfluss		starker Einfluss
Gerechtigkeit	System weniger gerecht		System gerechter
Kosteneffizienz	sehr gering		sehr hoch
current    previous

References

Sources of Information

"Means testing - which tier do you fall in?" Straits Times March 3, 2008.

Reform formerly reported in

Means testing for hospitalisation subsidy (2) Process Stages: Idee

Means testing for hospitalisation subsidy Process Stages: Idee

Author/s and/or contributors to this survey

Lim Meng Kin

Empfohlene Zitierweise für diesen Online-Artikel:

Lim Meng Kin. "Implementation of Means Testing". Health Policy Monitor, April 2008. Available at http://www.hpm.org/survey/sg/a11/4