Benchmarks for surgical fees raise transparency; help keep lid on costs

THE Ministry of Health's recent publication of fee benchmarks for common surgical procedures in the private sector has been a long time coming.

Singapore's rising medical costs are a perennial concern. AON's study, Asia's Healthcare Trends 2017/2018, estimated Singapore's medical inflation rate at 9.5 per cent in 2017; this is expected to inch up to 10.9 per cent this year. While this is an improvement from as much as 20 per cent in 2014, there is no room for complacency. The three-year insurer outlook for medical inflation is divided: 50 per cent believe that the current trend will hold, while the other half believes that it will rise significantly. In particular, inpatient costs are driving the price escalation. The fee benchmarks are themselves part of efforts to contain healthcare costs.

Alarm bells were raised by the 2016 report Managing the Cost of Health Insurance in Singapore by the Health Insurance Task Force, which found that the claims incidence rate of Integrated Shield Plans (IPs) had been rising at a three-year compounded rate of 9 per cent. Between 2012 and 2014 the overall bill sizes rose by 8.7 per cent at private hospitals compared to 0.6 per cent a year at public hospitals. Surgical charges at private hospitals were between two and 2.4 times higher than public hospitals. IP policyholders - particularly those with riders which enabled them to claim the entire hospital bill - were more likely to seek treatment at private hospitals. The study also noted that based on surgical bills provided by the Life Insurance Association, private hospitals and medical professionals may have over-charged patients by "inflating certain components of the bill''. These practices included the unbundling of routine laboratory tests for higher total billing, or charging excessive amounts for consumables.