Means testing for hospitalisation subsidy
- Country:
- Singapore
- Partner Institute:
- Department of Epidemiology and Public Health, National University of Singapore
- Survey no:
- (3)2004
- Author(s):
- Lim Meng Kin
- Health Policy Issues:
- Funding / Pooling, Access
Current Process Stages
| Idea | Pilot | Policy Paper | Legislation | Implementation | Evaluation | Change | ||
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| Implemented in this survey? |  |
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Abstract
The government is considering the use of use means testing to determine eligibility to enjoy government hospitalization subsidy benefits. No details have been released on either the criteria or mechanisms for mean testing. The idea is apparently being balloon-tested to gauge public reaction. Debate over whether means testing should be used suddenly came alive in January 2004, following media reports that the government was actively looking into the idea.
Purpose of health policy or idea
ObjectiveTo exclude the "rich" from receiving government subsidies intended for the poor and needy, to defray their hospitalization bills.
Main characteristics of proposalThe government is considering the use of means testing to determine eligibility to enjoy government hospitalization subsidy benefits. No details,
however, have been released on either the criteria or mechanisms for mean testing. The idea is apparently being balloon-tested to gauge public reaction.
Debate over whether means testing should be used suddenly came alive in January 2004, following media reports that the government was actively looking into the idea.
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Characteristics of this policy
| Degree of Innovation | traditional |
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innovative |
| Degree of Controversy | consensual |
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highly controversial |
| Structural or Systemic Impact | marginal |
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fundamental |
| Public Visibility | very low |
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very high |
| Transferability | strongly system-dependent |
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system-neutral |
Political and economic background
Presently, public hospitals in Singapore have a graded hospital ward system ranging from 1-bedded private rooms (with air-conditioning, attached bathrooms and other amenities) to open dormitories
with 8 or more beds. Patients pay more for higher levels of service in terms of comfort and amenities, with little or no difference in the standard of healthcare received.
Such a system allows, in theory, for the preferential targeting of subsidies --the assumption being the "poor" will opt for the lower classes of wards. Full costs are recovered from patients in "A"
class hospital beds, whereas those in "C" class enjoy 80% subsidy. However, because hospitals do not keep tabs on patients' financial status, they have no way of knowing if those utilizing the
heavily-subsidized wards are indeed the targeted needy population.
Purpose and process analysis
Current Process Stages
| Idea | Pilot | Policy Paper | Legislation | Implementation | Evaluation | Change | ||
|---|---|---|---|---|---|---|---|---|
| Implemented in this survey? | |
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Stakeholder positions
In January 2004, a little known group of citizens called the Health Feedback Group formally put forth the idea in their feedback report, that all health-care subsidies should be tied to patients'
financial status, instead of the hospital or ward class which they choose to go into.
Data released by the Ministry of Health shortly after strengthened the impression that it was the government that was balloon-testing the idea. The data showed a trend of the well-off patients opting
for the highly subsidized C-class and B-class wards. In year 2002, close to four out of every 10 patients in the top percentile by household income had opted for the subsidized wards. One in 10 chose
to stay in C class wards.
Although means testing has been talked about for years, the fact that both the Deputy Prime Minister and the Acting Health Minister have endorsed the suggestion in their public comments has made it a
major issue for Singaporeans, generating much debate in the newspaper forum pages, government-sponsored "feedback" sessions, and in parliamentary debate.
Adoption and implementation
Means testing is targeted at the preventing the undeserving "rich" from abusing the subsidies. This begs the question of how the "rich" will be defined, and whether the differentiation, based on
which eligibility for different levels of subsidy will be determined, will result in a "middle-class squeeze".
The middle-income group is expected to be worst hit by means testing. Those with chronic conditions requiring long-term healthcare fear they might not be able to cope with the financial burden
should the existing subsidies be lowered.
Concerns have been expressed that the policy presages the extension of means testing to other aspects of life in Singapore, such as transportation, housing, and education. Others feel that government
should be spending more on health care rather than incurring additional, administrative costs trying to overly fine-tune a system that hasn't broken down yet.
In response to questions raised in Parliament, the Acting Health Minister has given the assurance that the mechanism will be both "simple and cheap" to implement and not overly bureaucratic to
administer. He also gave further assurance that free choice of any class of ward would remain, but this does not mean that everyone will get the full subsidy.
Expected outcome
As the Ministry of Health gathers more feedback, and as more details of the likely criteria and mechanisms for means testing become known, more public debate can be expected to be generated.
References
Author/s and/or contributors to this survey
Lim Meng Kin