Hefty health-care costs have become a global concern, including in Singapore. Worldwide, countries struggle to contain them. Patients and families, too, are concerned.
In Singapore, a lot of attention has been focused recently on the role of doctors in driving up health-care costs through their fees.
While doctors certainly influence health-care costs, they are not solely, or even primarily, responsible for them.
Other contributors include technology such as drugs, medical equipment, implants; consumables such as nappies, dressings or intravenous drips; professional fees given not just to doctors but also therapists, dieticians, nurses and to cover hospital administration, laboratory tests such as radiological investigations; and facility fees for use of hospital rooms and operating theatres.
And there are always business costs such as rent.
Some factors are inherently expensive (think MRI scans and implants), but are used only once. Other, cheaper consumables may require prolonged use - such as adult diapers - and so, cost a significant amount in the long term. Drugs are another example of lower-cost items which, over the long term, may be expensive.
Apart from these components of health-care costs, how health care is paid for also has an impact on how expensive it becomes.
Payers such as insurance companies may inadvertently contribute to higher health-care costs.
For example, if insurance companies pay only for hospital admissions, patients tend to opt for this, even if they don't need it for minor surgery, which can be done within a day.
The "buffet syndrome" encouraged by newer health insurance plans which pay from the first dollar without co-sharing also tempts people to overuse medical services. Even if just a few do so, it results in higher premiums for all.
How can costs be minimised?
The final bill can be cut down with combined efforts, starting with patients, then looking at health-care providers, the payers and the policymakers.
For patients, the advice would be: Take ownership of your own health. Patients mindful of their health can tremendously decrease their lifelong health-care costs.
For example, regular check-ups can warn of any impending, disabling and expensive complication, such as kidney failure from diabetes.
Choosing the right doctor can also keep expenses under control.
The right doctor is one who will help you navigate the health-care system and is willing to discuss treatment options for any disease - and the cost options, too. The issue of overservicing and overcharging by doctors is a concern as costs escalate.
True, profit is essential for business growth and advancement in knowledge.
Without profits, the next breakthrough product cannot be researched and hospitals cannot invest in training of qualified staff and research.
But it is important to combine profit with a strong sense of ethics and values.
This way, patients are prescribed treatment they need, with cost-effective options.
Providers are fairly reimbursed for their care, while patients enjoy care that's affordable and appropriate.
Payers are agencies like health insurance companies that pay for health care.
To keep costs down, payers can do more with data sharing, having open and transparent pricing and "right-siting" of care. The latter involves choosing the right place to access the care. For example, inpatient hospital stays are expensive, compared with outpatient, day surgery.
Open and transparent pricing can be achieved when individual costs in the hospital or health-care bill are itemised.
This promotes healthy competition and productivity, and also aids in lowering costs.
Many countries have turned to collaborative data sharing, where payers and health providers pool data and, together, determine a sustainable fair price.
At the government level, one way to drive costs down is to go for group purchasing.
The state has a big role to play in cutting the cost of the final bill and making drugs and technology available to the public sector.
In Australia, the government buys drugs on behalf of patients - whether they are in the public or private sector. It also sets recommended prices within a range so that profiteering is minimised.
When the government prices its drugs, it takes into account the cost of running health-care facilities, as well as the need to ensure that pharmaceutical and implant companies make enough profits to do research and develop drugs. It does not leave it to private practice doctors to mark up drug prices at will. That is where the difference lies between overcharging and a reasonable profit.
In Singapore, there is group purchasing of drugs in public hospitals and health-care institutions, but not in private sector clinics.
There is also no recommended "selling" price and, hence, prices vary among hospitals and clinics.
There is also the issue of profit transfer, where doctors waive or lower professional fees, but charge for drugs to recover the ever-increasing cost of running a service. This is not an ideal situation and needs to be improved.
MediShield Life is a key step to ensuring health-care remains affordable. But the Government cannot do it alone. The patient, the provider, the payer and the policymaker must all do their part.
The writer is a geriatrician in private practice and chairman of The Good Life Cooperative that aims to help members age well and manage health-care costs.
This article was first published on Sep 23, 2014.
Get a copy of The Straits Times or go to straitstimes.com for more stories.