Healthcare spending on the rise because of higher utilisation, rising manpower costs: Gan Kim Yong

SINGAPORE: Singapore’s healthcare expenditure is set to continue to increase, largely due to the development of new facilities and the cost of running them, Health Minister Gan Kim Yong said in Parliament on Thursday (Mar 5).

Speaking at his ministry’s Committee of Supply debate, he said that Singapore’s national health expenditure increased from S$13 billion in 2012 to S$22 billion in 2017, or about 11 per cent per annum.

Breaking this down, Mr Gan said about five percentage points of this increase was due to increased utilisation, Mr Gan said.

“As our population ages and grows, demand for healthcare services also increases,” Mr Gan said.

Singapore is also utilising more healthcare than in the past, even after accounting for ageing and population growth, Mr Gan said.

“This is partly the result of making care more accessible and affordable to all, and partly due to earlier diagnosis and closer monitoring and follow-ups for medical conditions,” he said.

He added that the range of treatment options has also expanded as the frontiers of medicine advance, increasing utilisation, but at the same time improving life span and the quality of life.

HIGHER MANPOWER COSTS

About four percentage points of the growth in national health expenditure can be attributed to higher manpower costs, Mr Gan said.

“On one hand, our healthcare workforce expanded significantly between 2012 and 2017. On the other hand, our healthcare workers’ salaries also increased as we implemented pay adjustments to attract and retain our healthcare workers,” he said.

The remaining two percentage points were largely due to the rise in the costs of drugs, medical devices, and other overheads, he said.

Deputy Prime Minister Heng Swee Keat said in his Budget 2020 round-up speech that Singapore can expect that the overall national health expenditure will continue to increase as Singapore’s population ages and the Government steps up investments in facilities and services.

In explaining the need for an increase in the Goods and Services Tax, Mr Heng said that there are many critical national needs that are better met by Government provision through taxes, he said, pointing to building up healthcare facilities and services, and providing subsidies to ensure that our healthcare needs are well taken care of.

“They are recurrent needs, meaning that these needs will be there year after year. In fact, growing year after year. We need to fund them using recurrent revenue,” Mr Heng had said.

Mr Gan said Singapore must continue to be prudent in its healthcare spending to ensure it is directed towards where it gives us the best outcomes.

Patients too can play a part to ensure Singapore has a good and sustainable healthcare system, Mr Gan said.

“We can make wise choices, and have a trusted family physician to turn to for advice. Only then can we ensure that our healthcare system is sustainable and remains affordable for patients,” he said.

ROLE OF INFORMATION TECHNOLOGY

Information Technology (IT) will continue to be an essential enabler for the healthcare system, and MOH will continue to strengthen governance and safeguards on data, Mr Gan said.

“This will be essential to maintain the public’s trust,” Mr Gan said.

Mr Gan gave an update on “concrete steps” taken to implement the recommendations of the Committee of Inquiry (COI) on the SingHealth cyberattack.

Close to 80 per cent of the control measures recommended have been implemented or mitigated, he said.

“The more complex measures require careful implementation to avoid disrupting essential healthcare services and impacting patient safety. These will be progressively completed by 2022,” he said.

Various enhancements have also been made to strengthen the security of the National Electronic Health Record (NEHR) system, he said.

“Work is still ongoing, and the enhancements are being implemented. Mandatory contribution to the NEHR will be deferred until all enhancements are completed, and we are satisfied that the system is assessed to be sufficiently robust,” he said, adding that his ministry will provide further announcements on this at the “appropriate juncture”.

These steps will help to raise the “cybersecurity posture” of the public healthcare system, Mr Gan said.

Even as MOH secures its systems, it continues to explore how technology such as telemedicine can improve care, he said.

To date, 25 public healthcare institutions and 39 community care partners have started video consultation pilot services, he said.

“Keeping everyone healthy is a team effort, and we are all part of the team. So let us all play our part to keep Singapore and Singaporeans in good health,” he said.