Regional clusters will see GPs, polyclinics and providers from other sectors working together
HEALTH Minister Khaw Boon Wan shed some light yesterday on the changes in the health-care sector that have taken place in the last few years.
Replying to a question from Nominated MP Viswa Sadasivan, Mr Khaw said that key insights have been gleaned since the public health-care system was moulded into two giant clusters in 2000.
Then, it was hoped that the two clusters – SingHealth and National Healthcare Group – would bring about integration and coordination between hospitals, polyclinics and specialty centres under either umbrella.
Competition between the two groups would also lead to better service and lower cost for patients, it was said then.
Mr Sadasivan asked yesterday if these benefits had indeed materialised.
In reply, Mr Khaw said that while the cluster experience has been generally positive, lessons have been learnt.
One is that the integration of healthcare providers must go beyond the public sector to include private and charity sector providers as well.
This is because some patients, especially the elderly and chronically ill, will visit health-care providers from across the spectrum, whether general practitioners or community-run nursing homes.
The other is that the unique characteristics of the health-care sector throw up obstacles in the way of competition.
Competition in health care is rarely between large clusters, but instead takes place on the micro level, say between doctors or departments, he added.
“Many economists have concluded that there is significant market failure in health care,” Mr Khaw said.
Information asymmetry, in which providers know more than the consumers, is one key reason for the failure, he added.
Market failure is not inevitable, however. Mr Khaw later brought up the example of obstetrics as one field where the market is naturally competitive. Most pregnancies are routine ones.
He noted: “Pregnant ladies, because of nine months of antenatal care in clinics, have a lot of information to share. They know which doctors are charging what. So there’s information transparency. This
is a classic example of where the conditions for competition exist and exist well. That’s why obstetric service has been pretty competitive.”
Another example is corrective eye surgery, he noted. A few years ago, he conducted an experiment by publishing prices for Lasik operations. “Within two or three months, the prices of Lasik packages dropped by more than $1,000 per eye,” he recalled.
“Unfortunately, the bulk of healthcare services do not lend themselves to such a competitive environment. But we have to continue to make progress.”
He said that with these insights, his ministry was now establishing regional clusters to “build partnerships and seek synergies beyond the public sector”.
A northern cluster will be anchored by the upcoming Khoo Teck Puat Hospital in Yishun, and an eastern one by Changi General, working with St Andrew’s Community Hospital next door.
Later, Mr Sadasivan told The Straits Times that he tabled the question because of concerns on the ground that the two-cluster system was creating competition for competition’s sake.
He said he had heard complaints that the system created inconveniences without bringing down prices for patients.
“In the past, the two groups did not share data. Let’s say you’re first admitted to SGH for a heart condition. Subsequently, you move and you’re closer to NUH. Since the hospitals are in competing clusters, the patient has to start from scratch in terms of data,” he said.
“My own sense is that Minister Khaw is moving towards streamlining and flatlining the structure,” he added.
He views regional clusters as a positive development, as they will make sure patients have faster access to primary care.
Khoo Teck Puat Hospital, which will open later this year, will be flanked by a community hospital for the chronically ill, as well as a nursing home.
The three entities will work with the general practitioners, polyclinics and other health-care providers in the area.