Long-term Strategies to Ensure Healthcare Cost Containment and Reduction of Unnecessary Medical Tests

Mr Dennis Tan Lip Fong asked the Minister for Health (a) whether the Ministry has assessed the extent to which unnecessary medical tests, procedures or prescriptions contribute to rising hospital bill sizes; (b) what measures are in place to prevent over-servicing by healthcare providers; and (c) whether patient cost-sharing mechanisms can be enhanced to deter excessive consumption of medical services.

The Ministry of Health (MOH) outlined its key strategies to manage healthcare cost during the recent Committee of Supply (COS) debate. These are widely regarded as international best practices.

To manage growth in cost of delivery, we implemented Health Technology Assessments to ensure that we fund and encourage the use of health technologies that are clinically- and cost-effective. With these efforts, we observed that drug spending growth in the public healthcare system has slowed from around 10% before financial year (FY) 2021 to 5% in FY2023.

We have also implemented a value-driven care programme throughout our public healthcare clusters, tracking and benchmarking quality and cost outcomes across common conditions and identifying areas for improvement. These ensure that what we spend on healthcare is commensurate with good health outcomes for Singaporeans.

Demand for healthcare will grow with an ageing population. Through Healthier SG and Age Well SG, we are investing in population health to keep Singaporeans healthier for longer. We are transforming care to anchor care in communities as far as possible, instead of over-relying on acute hospitals.

We developed and publish fee benchmarks for close to 2,200 common procedures and conditions to guide fee setting in the private healthcare sector. We also publish hospital bill size information across all hospitals and ward types to enable patients to make comparisons. Through a Claims Management Office that we set up in 2022, we have stepped-up monitoring and enforcement against inappropriate MediShield Life claims that may drive up costs and healthcare insurance premiums.

Finally, an important factor to manage costs is to ensure that we maintain financial discipline in how we pay for healthcare. We try not to over-rely on only subsidy or insurance. Instead, through a combination of subsidy, MediShield Life and MediSave, and maintaining some co-payment from patients, we try to keep healthcare affordable. As a result, our national healthcare spending is under 5% of the gross domestic product as of 2022, which is significantly lower than the 10% to 12% of other developed economies. This translates into a lower healthcare financial burden for Singaporeans.