Paul Tambyah: Budget needs to take care of the have-nots

Singapore Democrats

Good evening all,

I would like to thank Sze Hian and MARUAH for inviting me to speak at this event. Firstly I would like to clarify that I am speaking in my own personal capacity as an activist and politician and NOT as a representative of the University and the hospital. I hope that the Independent can take note of that as it causes problems for a lot of people when the different roles that we speak in are mixed up. The University has a very clear policy on public communications which recognises that “Academics are regarded by society as scholars and by tertiary students as role models, and should therefore balance freedom of expression with accountability to society. Faculty and staff members are generally free to express their views on a subject matter as long as they behave in a responsible manner, and it is clearly stated that these are their personal opinions, and not the official views of the University. In expressing personal opinions, faculty and staff members should refrain from stating their university affiliation”. I have been reassured by those in authority that I will be treated no different from other academic politicians such as Asst Prof Intan or Assoc Prof Janil Puthucheary and I would ask that you respect that.

Now I would like to get to the most important concerns I have to raise today. I would like to present three wishes for Budget 2018. I know that Finance Minister Heng Swee Kiat said that he is not Robin Hood nor Santa Claus but I am kind of hoping that he will be a genie and grant three wishes.


The first is in the area closest to my heart – healthcare. As I have mentioned on numerous occasions, Singapore has excellent healthcare with some of the finest doctors, nurses and allied health professionals in the world especially in our public hospitals. We have access to the most up to date technologies and drugs and some really modern facilities with state of the art equipment. However, our healthcare financing system is overly complex leading to many people being afraid of falling sick in Singapore. In response, the Medishield Life program was introduced after GE 2011 and soon after the SDP launched our Healthcare Plan in 2012. It is a strong step in the right direction in that it included individuals with pre-existing medical conditions including congenital illnesses who had previously been excluded from Medishield. The problem is that Medishield Life is still primarily a catastrophic health insurance policy but unlike other public catastrophic health insurance policies, it carries an annual cap on how much it will pay out. In countries such as the Netherlands or Taiwan which have state mandated national health insurance schemes, there is a cap on how much an individual has to pay with the state insurance taking care of the rest for those with truly catastrophic expensive illnesses. In contrast, with Medishield Life, while there is no lifetime cap, like commercial insurance policies, there is an annual cap on the payout by the insurer with the rest of the costs for very expensive treatments being borne by the individual. This has resulted in the sad spectacle of children and adults with rare diseases who require expensive treatments in excess of their annual Medishield Life claims limits resorting to crowdfunding through the various thriving online crowdfunding platforms. Singaporeans are very generous and many have given to support these individuals who need expensive medications to stay alive but I personally believe that having a child with a rare genetic disorder or cancer which does not respond to first or second line treatment should not force an individual to turn into an online beggar.

It is not just in the rare diseases with expensive treatments beyond the Medishield Life annual caps which are the problem. The co-payments and deductibles that come with Medishield Life are also very high. For an 81 year old staying in a C class ward, the first $2000 of the hospital bill is not covered by Medishield Life. Expenses above $2000 also carry a 10% co-payment and Medishield Life only covers inpatient costs and some very selected outpatient costs including chemotherapy, dialysis and some transplant medications. This means that for the vast majority of C class hospitalisations and outpatient treatments, individuals who have paid into Medishield Life are unable to claim for their treatments. The evidence for this comes from data provided by the Ministry of Health citing the CPF annual reports. These data show that for 2016, the total amount of money collected in premiums from Singaporeans was $1.858 billion. In contrast, the amount paid out was $745 million which would make Medishield Life much more like a commercial insurance scheme rather than a mandatory public insurance policy. The government challenges this approach by arguing
“This approach is not a holistic representation as it omits a large part of what MediShield Life premiums are meant to support, namely future long-term claims and premium rebates.” I am not an insurance or financial planning expert like the other two speakers but no other public mandatory health insurance scheme in the world to my knowledge uses this method of calculating its incurred loss ratio.

The impact of restricting payouts in Medishield Life reduces the potential for Medishield Life to really make a difference in the health of Singaporeans. An example of what has worked is the one-off Pioneer generation package which greatly reduced the costs of primary healthcare for individuals who were classified as Pioneers. In contrast, Medishield Life with its restriction to hospital care and tertiary outpatient care has led to the paradoxical situation where people do not get the help that they need until it is too late. To give you an example, I recently visited a friend at a long term care facility and saw row after row of disabled Singaporeans who had had strokes. Many of them were in their fifties and sixties and many of them had been told some time before their stroke that they had an irregular heart rate or high blood pressure but they had not followed up on this because of the costs of medications or the lack of an integrated subsidized primary healthcare system that catered to working Singaporeans. The polyclinics do good work but they only cover 20% of primary healthcare in Singapore, the bulk of which is provided by private general practitioners. These individual GPs pay commercial rates for drugs, rental and equipment and have to recover costs from patients although most of them would often waive charges for poor patients. Apart from the very limited subsidies provided by the CHAS system, most people pay for their GP visits in cash or through their employers insurance as Medishield Life cannot be used for GP visits. The result is that irregular heart rhythms and high blood pressure are often inadequately treated until it is too late and a stroke occurs. The consequences of a stroke can be devastating. Despite the fact that Medishield Life will then kick in to cover the costs of inpatient stay, for the individual and the family, this is something which could and probably should have been prevented by more affordable and accessible primary healthcare.

The latest innovation we have heard about is the proposal to make Eldershield compulsory and to lower the age for contributions to 30. This is worrying as it suggests that the same metrics for calculating the loss ratio for Medishield Life are being applied to Eldershield. Indeed, according to the Straits Times of 1 Feb 2018
“In Parliament last year, Health Minister Gan Kim Yong said $2.6 billion in ElderShield premiums was collected between 2002 and end-2015, and around $100 million was paid out in claims”. Personally, I think it would be simpler to just allow individuals to use their Medishield Life funds to pay for orthopaedic devices, diapers, wound care creams and other medical needs that disabled older Singaporeans would need.

So, my first wish is that Medishield Life be expanded to cover evidence-based healthcare interventions. I raised this at the IPS dialogue with DPM Teo Chee Hean last month and his response was to cite the classic neoliberal argument that if you provide free medical care, a “buffet table syndrome” will result. This means that individuals will get all kinds of diseases and treatments just so that they can enjoy the free medical benefits. This is not his fault, it is a widely held belief among health economists from various right wing think tanks primarily in the United States who have advanced this argument. To those of us who practice medicine on a daily basis, it is completely at odds with reality. There are some individuals who seek medical treatment when they do not really need it – they have a medical condition known as Munchausen’s syndrome which can actually be successfully treated. The rest of the people most doctors see everyday in the wards and clinics of our local hospitals do not want to be there. The happiest moments of my practice are when a patient shakes my hand and says “Thank you doc, I hope to see you again, but not in hospital!”. No one with cancer wants to get cancer or with a heart attack wants to get a heart attack just because his insurance provides free treatment for cancer or heart attacks. None of us chooses to get sick. Healthcare is a basic human right and the World Health Organization now recognises that truly universal healthcare is a fundamental human right. We have taken the first steps towards this with Medishield Life covering pre-existing medical conditions and congenital illnesses, we now need to move closer towards truly universal medical care where no one needs to go begging online to support their children’s healthcare expenses or ends up hospitalised for a preventable medical condition such as a stroke caused by an irregular heart beat.

Aging population

Don’t worry, my second and third wishes are a lot shorter! My second wish relates to the bogeyman of the elderly Singaporean. I hear a lot about how we have an ageing population in Singapore and the aged-dependency ratio is changing dramatically and that we have a demographic time bomb and other alarmist rhetoric. This annoys me tremendously mainly because firstly, it is not accurate. We do not have 200 and 300 year olds walking around the streets of Singapore demanding expensive social services. We do not even have 92 year old politicians trying to upset the political leadership succession plans for our country. What has happened in Singapore, just like in many other countries, is that social conditions and medical care have resulted in fewer people dying young. This means that more people are surviving to an older age which should be a good thing – something to be celebrated. The problem comes about when people are unhealthy regardless of their age. An unhealthy 50 year old with diabetes, kidney failure and an amputation, will need a lot more social and medical support than an 80 year old who runs marathons. The best news in recent weeks has been that the number of new dialysis patients has dropped for the first time in decades. While the authorities were rightly cautious about this, it may mean that the tide is finally turning and the incidence of chronic diseases will drop in older Singaporeans to levels closer to what middle aged Singaporeans are experiencing today. This is not wildly optimistic – in many developed countries, death rates from cancer have dropped across the board, dementia rates have also dropped. Indeed, there are some accurate data from Singapore which suggest that older people in Singapore, far from being a burden on society as some would paint them, are actually making significant contributions far in excess to the benefits that they receive.

The report “A Profile of Older Men and Women in Singapore 2014”, was prepared by the Tsao-NUS Ageing Research Initiative and the International Longevity Centre Singapore. Some striking findings included in the report are that 73% of older adults aged between 60 and 75 and 28% of those over 75 provided financial assistance to their children. Many middle-class Singaporeans now feel that they have to provide assistance to their adult children trying to make down payments for their first properties, something that was unheard of a generation ago. The other important piece of data in that report was the decreasing prevalence of chronic diseases in the very elderly – for example, while 31% of those 65-69 had diabetes, only 7% of those over 85 had diabetes. This is a phenomenon known as survivorship – in other words, individuals who live beyond 80 are actually probably healthier than many people in their sixties because of a combination of genetic, environmental and other factors. Thus, just because there are more 80 years olds now than there were 20 years ago does not mean that there are more unhealthy people around now. In fact, the opposite is more likely to be true. Furthermore, the older generation of Singaporeans ten years from now will be far more educated than our predecessors, thus giving us far more options in terms of careers and financial options. The one difference is that none of us will have pensions and we will have to depend on our CPF or our investments to keep us going as we start to make way for the younger generation and plan on enjoying the fruits of our labors. Basically, the sum of this argument is that older Singaporeans are not a burden. They already contribute significantly to their families, to society and our nation as a whole. With good primary care, they can live long and healthy lives and should not be used as an excuse for raising taxes to fund the very limited social support systems that we have here in Singapore. So my second wish is that the Minister of Finance does not use the excuse of “having fewer people dying young” for raising taxes on all of us.

Income inequality

My third and final wish is that the government will take serious steps to address the problem of inequality. Singapore is recognised as one of the most unequal societies in the developed world, similar to the United States or Hong Kong, and vastly different from the Scandinavian countries or Japan. This has a real impact on people as we can see from the data on population demographics. We know from Singapore’s report on the registration of births and deaths from 2015 ( that the average age of death for a Chinese person in Singapore is 77, for Malays 70.3 and for Indians 68.0. This is different from life expectancy. Life expectancy at birth means that a baby born in Singapore today can expect to live to 83 years old. That is an outstanding public health achievement and the result of investment of huge amounts of resources in pediatric and obstetric care. The average age of death on the other hand refers to adults, not babies and thus the ICA data shows us that (and I quote directly from the report) “there are disparities in the average age at death among different ethnic groups. The AA for Chinese was 77.0 years compared with 70.3 years for Malays, 68.0 years for Indians and 66.3 years for other ethnic groups. The gap in AA between Chinese and non-Chinese ethnic groups existed in all major causes of death except diabetes mellitus.” No details of socio-economic status are provided but it is likely that a large part of the differences are due to socio-economic rather than racial factors. A study from Singapore’s Eye Research Institute published in the journal Nephrology, Dialysis and Transplantation in 2009 showed that within the Malay community, poorer health outcomes were independently associated with lower socio-economic status ( Thus inequality can be to a matter of life and death for poorer Singaporeans of all ethnic groups.

It has been argued that open free market trading economies such as Hong Kong, the United States and Singapore will inevitably have inequality far in excess of more closed societies such as Japan or Scandinavia. That may be true but in Singapore, public policy has a major role in reducing or exacerbating inequality. There is a lot that can be done.

To take the most obvious example – education. It is widely recognised that education is a pathway out of poverty and that good students who study hard and are given the opportunity have a chance to bring themselves and their families out of so-called poverty traps. There are many in Singapore in the Universities and others who have tried to address inequality by strengthening outreach programs to underrepresented groups. However, the best interventions are early. The pinnacle of Singapore’s early education system is the Gifted Education Program. Their website states clearly that “There are 2 main reasons for implementing the GEP in Singapore:  The Educational Factor: It has been recognised that children have varying abilities and it is not a sound practice to give every child the same education and expect him/her to move at the same pace as his/her peers. The intellectually gifted need a high degree of mental stimulation. This need may not be met in the mainstream classroom and the gifted child may become mediocre, indifferent or disruptive in class. And   The Socio-Political Factor

Singapore is a small nation with only human resources to rely on for its progress and prosperity. It is to the advantage of the nation that the gifted are helped and nurtured.” 

While this does sound a bit elitist, the list of primary schools offering the GEP is even worse. There are nine primary schools offering the GEP in total, four of them, Catholic High School, Nan Hua Primary School, Nanyang Primary School and Tao Nan School do not offer Malay or Tamil as a second language effectively restricting access to a significant number of children. Of the remaining five schools, a quick check with the URA Space Map (  and the Singstat table 152 of the General Household Survey of 2015 (
shows an interesting distribution. Two of them – Henry Park Primary School and Raffles Girls Primary School are located in the Bukit Timah Planning Area where 44.3% of the resident households have incomes of more than $20,000 a month in comparison to the national average of 12.1% across the URA planning areas. One, ACS Primary is located in the Novena planning area which has 27.4%. Another, Rosyth School is in the Serangoon planning area with 21.3% of households in the highest income categories. Only St Hilda’s is located in a planning area closer to the national norm with only 9.5% of households in the Tampines area belonging to the highest income category. This economic segregation of elite primary schools provides well-to-do Singaporeans with additional help that they do not need. Don’t get me wrong, some of my best friends are from the GEP but I think its implementation needs to be adjusted especially at the primary school level.

Singapore’s taxation system is already extremely regressive. The highest taxes are paid by low wage work permit holders who contribute up to 40-50% of the money paid by their employers to various government levies. In Singapore, elderly Ah Pek’s and Ah Ma’s who have to pay GST on the medications that they buy from the Sinseh and on the water conservation tax that they pay in their homes. In contrast, a young person who inherits a fortune from his parents and has not worked a day in his life but simply pays some bright fund managers to invest the money to generate returns, who lives on a yacht, shops in Milan, Tokyo and Shanghai, pays no estate duty, no capital gains tax, very little GST, while at the same time enjoying taxpayer funded infrastructure, amenities, security and resources. Very few countries outside of city states such as Monaco do such transfers to the wealthy the same way that we do.

None of the people born into poor families I know in Singapore ask for a handout. They simply want a level playing field where they are given the same opportunities as other Singaporeans to work hard, do well and be recognised for their efforts. My third wish is for the government to do something to remove structural inequalities in Singapore.

So there you have it – three wishes – expand Medishield Life, stop using people who live longer as an excuse to increase revenues, and do something to remove the structural inequalities that prevent all Singaporeans from achieving our potential.

Monday, 12 February 2018 speakup2 Print