Fee Benchmarks for Medical Procedures

12 Dr Lim Wee Kiak asked the Minister for Health (a) what is the Ministry's rationale in introducing fee benchmarks for medical procedures; (b) how is this new guideline aligned to the spirit of fair competition; and (c) whether the Ministry is aware that the benchmarks may cause doctors who are charging lower fees to charge higher fees.

13 Assoc Prof Daniel Goh Pei Siong asked the Minister for Health whether the removal of the Singapore Medical Association fee benchmarks in 2007 has led to the inflation of medical costs in the last decade and how will the Ministry's fee benchmarks be independently derived so as to prevent anti-competitive price-fixing.

The Senior Minister of State for Health (Mr Chee Hong Tat) (for the Minister for Health): Mr Deputy Speaker, the introduction of fee benchmarks is part of a larger strategy to keep healthcare costs affordable and sustainable as we prepare for an ageing population in Singapore. This is a shared responsibility and requires a collective effort from all stakeholders. We, as individuals, have to take good care of our health and make informed choices when we seek treatment. Healthcare professionals play a key role in providing quality care that is appropriate to patients' needs and charge reasonable fees for their services. The Government and healthcare institutions need to continue to improve productivity and look for ways to deliver greater value for patients. Employers and insurers can help to manage increases in healthcare costs by encouraging prudent use of healthcare services by their employees and policyholders.

Sir, the Singapore Medical Association (SMA) first introduced its guidelines on fees (GOF) in 1987. It withdrew the GOF in 2007 after it was informed by the Competition Commission of Singapore of anti-competitive concerns. There was no significant change in the average annual healthcare inflation rate in the decade preceding and following the 2007 withdrawal of SMA's GOF, which were 2.4% and 2.6% respectively.

Recent policy measures, such as the Pioneer Generation package, MediShield Life subsidies and the Community Health Assist Scheme, have helped to reduce the healthcare inflation rate to about 1.2% between 2013 and 2016.

Over the past years, the Ministry of Health (MOH) has been publishing historical transacted hospital bill sizes and operation fees for common medical procedures to enhance transparency of healthcare charges. The introduction of fee benchmarks will take this further by providing all stakeholders a useful reference. We believe this will encourage appropriate charging practices and provide useful information for patients and payors to make better informed decisions on their care options.

The fee benchmarks will be set by the Ministry with advice from an independent committee that comprises stakeholders representing the medical community, providers, patients and payors from both the private and public sector. The benchmarks will be reviewed and updated regularly, with references made to historical transacted data.

The fee benchmarks are not intended to restrict competition as doctors are not prohibited from charging lower or higher fees if they wish to. The fee benchmarks serve as references for the public, including insurers and professional bodies, to assess whether the fees charged by a healthcare professional are reasonable.

The Ministry will, however, continue to monitor the charging practices in the healthcare sector.

Mr Deputy Speaker: Dr Lim Wee Kiak.

Dr Lim Wee Kiak (Sembawang): Mr Deputy Speaker, I thank the Senior Minister of State for the reply. I would like to clarify with the Senior Minister of State regarding the fee benchmarks which MOH will roll out soon. Do they include the total bill, with breakdown into the components, such as the doctors' fees and facility fees? Part of the public concerns have to do with the facility fees charged by the hospitals, which have been increasing quite a fair bit recently.

The second clarification is on my last question asking whether these benchmarks will cause doctors who are charging lower fees now, to up their fees instead. So, we are worried that there could be a knee-jerk reaction.

Mr Chee Hong Tat: Sir, I thank the Member for his supplementary questions. Indeed, the concern about healthcare fees is not only about doctors' fees. It is about the overall healthcare cost. So, this will include doctors' fees, but it would also include facility fees and other components of the overall healthcare cost that patients, insurers, taxpayers and Government, on the whole, will have to pay.

We focused on doctors' fees for a start because these were also the recommendations of the Health Insurance Task Force. It made a report and recommended that fee benchmarks focused on professional fees in the first instance. For other fees, such as hospital charges, Dr Lim Wee Kiak is aware that we currently publish the facility fees for common procedures. If there are ways that we can present the information better to allow members of public and patients to have more information to make comparisons, we would be happy to receive feedback on how we can do better. We will also continue to monitor if benchmarks for other healthcare-related services will be required in the future.

Sir, the fee benchmarks, by themselves, will not be a silver bullet to address healthcare costs. I mentioned in my reply that we also need collective effort from all stakeholders as providers and institutions need to focus on improving productivity, improving appropriate care. Recently, we set up the Agency of Care Effectiveness (ACE) and they issued some guidance on appropriate care guides, drug guidances. These are ways to help medical professionals, patients and caregivers to identify what are the cost-effective treatment options. So, ACE will also be looking into medical technology guidance this year to guide the selection of clinical and cost-effective medical devices.

Mr Deputy Speaker: Assoc Prof Daniel Goh.

Assoc Prof Daniel Goh Pei Siong (Non-Constituency Member): I thank the Senior Minister of State. I am presuming he was also answering Question No 13.

Mr Chee Hong Tat: I meant to ask for Mr Deputy Speaker's permission to answer both Question Nos 12 and 13 together. I apologise for that.

Assoc Prof Daniel Goh Pei Siong: I have three supplementary questions. First, what other sources of information or expertise would the Ministry be using to ensure the independence of the benchmarks other than that of the Advisory Committee? Second, how would the Committee be involving the patients because they are not organised into associations or any other kind of bodies? Third, what would the Ministry do to prevent insurers from using the benchmarks to reduce the payouts or to reject legitimate claims?

Mr Chee Hong Tat: I thank Assoc Prof Goh for his supplementary questions. I think it is important for us, when we do the fee benchmarks, to have representation from all stakeholders – the professionals, the professional bodies and, of course, from patients, consumers. We want to be able to reflect different perspectives as we set the benchmarks. These benchmarks are meant as guidelines, as references. When insurers refer to these benchmarks, it is not something that prevents them from treating each claim on a case-by-case basis. Depending on the merits of the case and, certainly, if it is within the appropriate guidelines, insurers, I am sure, would continue to be able to fulfil their obligations to their policyholders, in accordance with the terms of their insurance products.

Going back to the earlier point that Dr Lim Wee Kiak raised with regard to the concern that some doctors may, as a result of this, raise their fees. I certainly hope that would not be the case because I believe that the large majority of our doctors have their patients' well-being and concern at the foremost, and that is what they want to focus on.

But, of course, the benchmarks would help us to identify the small number of doctors who overcharge. This is information for us to be able to use, for patients to use, for insurers to use and for the authorities, including the Singapore Medical Council, for them to be able to take action and prevent the small number from raising healthcare costs for everyone else.

Mr Deputy Speaker: Assoc Prof Daniel Goh.

Assoc Prof Daniel Goh Pei Siong: I agree with the logic of representation. The question is: how do you select the patients? Because it is not really organised as a body.

Mr Chee Hong Tat: Sir, we have groups like the Consumers' Association of Singapore. We also have groups that can represent different stakeholders. It would not be possible to represent every single individual, as I am sure Assoc Prof Goh would agree with me. But to have the input and perspective from patient groups, from consumers, certainly, that would be something that could be taken as part of the process.