By Ames Gross
Singapore boasts one of the highest GDP per capita in the world at $59,000 and this places ahead Singapore ahead of the US, Germany, UK and Japan. More importantly, the Singaporean economy is still growing strongly despite the global economic slowdown. With their 2011 GDP of $315 billion, the Singaporean economy is larger than that of Portugal, Norway and Ireland – despite having a much smaller population.
In 2011, the Singapore government’s healthcare expenditure was approximately $8.97 billion, or roughly 3.75% of their GDP. At the individual level, Singapore’s per capita healthcare expenditure of over $1,450 per person is second behind Japan in Asia. The high level of wealth and healthcare expenditure makes Singapore’s healthcare market very attractive for foreign medical device companies.
Currently, the market for medical devices is approximately $460 million and growing. Thus, international companies need to comprehend Singapore’s healthcare system in order to succeed.
The primary care sector in Singapore’s healthcare system is dominated by private providers, which covers approximately 75% of the market. The public sector dominates the acute sector care. There are also government funded voluntary welfare groups which service the step-down care sector, such as nursing homes, community hospitals and hospices.
Primary Healthcare Services
Singapore’s network of 1,980 private medical clinics covers roughly 79% of the primary healthcare services in Singapore. Eighteen public sector polyclinics provide the remaining coverage. These polyclinics treat patients discharged from hospitals and provide medical care for outpatients. They also provide pharmacy services, immunization, health screening and health education. All Singaporean school children and those above the age of 65 are eligible to receive up to a 76% discount at these polyclinics.
Secondary and Tertiary Specialist Care Services
Singapore has seven public hospitals, comprising of a psychiatry hospital, a children’s and women’s hospital and five general hospitals. The general hospitals provide general and specialist treatment for both inpatient and outpatient services. They also contain 24-hour emergency units.
In addition to the general hospitals, Singapore also has six national specialty centers. Each specialty center specializes in a different field — cardiac, eye, skin, cancer, dental and neuroscience treatment.
Overall, the public hospitals and specialty centers cover about 82% of the secondary or tertiary services. The private hospitals service the remaining coverage.
Healthcare Tiers in Singapore
Singapore does not have one system of reimbursement for medical devices. Instead, Singapore’s healthcare system provides a variety of protection to keep surgeries, drugs and medical devices affordable. The Singaporean government provides large subsidies, supplemented by other programs such as MediShield, ElderShield, Medifund, and the Medisave program.
To simplify, the government healthcare subsidies in Singapore can be divided into 4 main tiers. The first tier, large government subsidies, provides coverage of up to eighty percent of the total medical bill for acute public hospital wards which are accessible to all Singaporeans.
The second tier, Medisave, is an individual medical savings account plan which is mandatory for all Singaporeans. Working Singaporeans, as well as their employers, contribute a percentage of their monthly salary to this account to cover future medical costs. The account is also portable to other jobs and can still be accessed after retirement
The following hospital costs are covered by Medisave:
Medisave also covers the following hospitalization and other approved expenses:
The third protection tier in Singapore is MediShield, a risk-pooled catastrophic medical insurance plan that is inexpensive. Through a co-payment and deductible system, MediShield covers major illnesses which can be problematic for insurance policies. Up to four-fifths of significant medical bills are covered by MediShield.
The fourth tier of protection in Singapore is ElderShield. ElderShield is a risk-pooled severe disability insurance which covers the financial costs associated with having a severe disability. ElderShield subscribers can also obtain higher disability insurance coverage by purchasing “ElderShield Supplements”.
Lastly, the Singapore government also has an ultimate safety net for disadvantaged Singaporeans who cannot afford their bills even after the generous subsidies in the form of a medical endowment called MediFund.
Singaporeans can also add to their existing healthcare coverage by purchasing additional private insurance policies. Singaporeans must first be MediShield subscribers before they can purchase the additional private plans. This practice is common amongst the middle and higher income Singaporeans. The structure of the industry maintains the national risk pool and prevents private insurers from patients who are already very healthy.
As outlined above, the Singapore healthcare system is indeed complex. As such, international medical device companies need to comprehend this to be able to succeed there.
Ames Gross is president and founder of Pacific Bridge Medical, recognized nationally and internationally as a leader in the Asian medical markets. Founded in 1988 PBM has helped hundreds of medical companies with business development and regulatory issues in Asia. Contact PBM at firstname.lastname@example.org.
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