Scrap Medisave and increase govt spending

Singapore Democrats

Do away with the ‘3M’ system (Medisave, Medifund and Medishield) and pay all our healthcare expenditure through a single pool of funds in which the Government contributes 84 percent.

This is the essence of the SDP National Healthcare Plan: Caring For All Singaporeans which was prepared by the Party’s Healthcare Advisory Panel comprising Drs Ang Yong Guan, Patrick Kee, Neo Eak Chan, Leong Yan Hoi, Tan Lip Hong, Tong Beng Chye, Wong Wee Nam and Ms Eveline How.

Under the SDP’s Plan, Medisave will be scrapped and the money returned to one’s CPF Ordinary Account. Singaporeans who are employed and earning $1,500 or more will contribute $600 per year into the National Health Investment Fund (NHIF). This will be deducted from their CPF savings.

Those earning between $800 and $1,500 will pay $300 per year. Individuals who earn less than $800, are unemployed or on social welfare will not be required to contribute.

Tan Lip Hong talks about the Healthcare Benefits Smart cardUpon payment into the NHIF, each user will be issued a Healthcare Benefits Smart Card which will entitle the holder to pay only 10 percent of the total hospital bill and capped at $2,000. So if one’s hospital bill is $5,000, he/she need only pay $500. If the bill is $30,000, the patient pays $2,000.

And if one visits the GP at a family clinic to get treatment for coughs and colds, the Government pays $10 of the bill and the patient foots the remainder. This will ensure that while the government subsidises the bill, the patient will co-pay the bill to prevent abuse. $CUT$

Those who do not contribute to the NHIF (unemployed or welfare recipents) will receive full subsidy if they fall ill and need to see the GP or have to be hospitalised. In other words, they will not have to make payment.

The Healthcare Card also stores medical information, utilisation history and payment records which is easy for hospitals, clinics and patients to use, and therefore reduces administrative costs.

All public hospitals will have only one-class system comprising of 2-bed wards instead of the present Classes A, B1, B2 and C. Such an arrangement ensures that those who need urgent treatment get it first, regardless of one’s ability to pay.



Wong Wee Nam: “The poor cannot go without treatment.”

For example, patients who need to undergo surgery will have their waiting times based on clinical indications and not on the basis of ward class.

It is more equitable than the present system which gives priority to those in the higher-class wards.

Healthcare is a human need, the Panel said, not a commodity where the rich can buy immediate and better treatment, and the poor have to wait months on end to receive medical care.

Financing for the SDP Plan

Total healthcare spending in Singapore in 2010 was about $12 billion. This is made up of the Government’s portion, payments from the 3Ms, out-of-pocket payments and payouts by insurance companies. We project this to increase to about $14.7 billion by the time our Healthcare Plan is implemented.

Of this amount, the NHIF will shoulder up to $11.8 billion. The Government will contribute $10.5 billion to this Fund and the remaining $1.3 billion will come from our CPF deductions as described above. Co-payment (out-of-pocket payments when one visits the GP, for example) will add up to $0.6 billion. The remaining amount will be due to private spending (paying for treatment at private hospitals, for example).

The present Government budget is $4 billion. The SDP Plan proposes that the Government increases this amount to $10.5 billion. The difference of $6.5 billion is more than made up by:



  1. Reducing defence spending  Collection: $5.75 billion
  2. Introducing luxury tax  Collection: $1.85 billion
  3. Introducing property taxon foreign property buyers  Collection: $0.2 billion
  4. Increasing corporate tax  Collection: $1 billion
  5. Abolishing GST for healthcare  Collection: $0.35 billion
  6. Collecting from Tote Board  Collection: $1.5 billion

         Total $10.65 billion

We have striven to make this a caring and financially sound healthcare plan. We want to make it an even better plan by consulting the public and inviting you to give us your views and suggestions. We will include them where appropriate and incorporate them into the publication.

You can contribute your views by posting on the comments section below, email us at [email protected] or go to our Public Consultation page on our Facebook. You can read the full 87-page report here. We look forward to hearing from you.

(from left) Leong Yan Hoi, Neo Eak Chan, Wong Wee Nam, Ang Yong Guan, Eveline How, Paul Tambyah, Patrick Kee, Toh Beng Chye, Tan Lip Hong (Cheng Shin Chuen is not in the picture)

More photos of the launch event at SDP’s facebook photo album.

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