Singapore Beats Hong Kong in Health Efficiency: Southeast Asia

Singapore overtook Hong Kong to top a ranking of the most-efficient health-care systems, as the government boosts spending on medical services to support an aging population.

The Southeast Asian nation was rated first among 51 countries, according to an annual ranking compiled by Bloomberg that tracks factors including life expectancy, the cost of health care as a percentage of gross domestic product and total medical expenditure for each person. Hong Kong dropped to second place and Italy was ranked third, while the U.S. was 44th and Russia last.

Singapore has increased health-care spending in recent years as the workforce ages and the government faces political pressure to ease the burden of the country’s poor. The city-state subsidizes some medical expenses and patients are required to take on more of the costs if they choose premium services, with citizens using mandatory savings set aside for health-care needs.

“I describe Singapore’s system as the least imperfect in the world,” said Jeremy Lim, head of Oliver Wyman & Co.’s Asia-Pacific health and life sciences practice. “If Singapore can successfully balance the increased funding availability with prudent measures to curb inappropriate and over-consumption which society as a whole accepts and supports, the future would be very promising.”

Health-Care Spending

Prime Minister Lee Hsien Loong’s administration will spend close to S$4 billion ($3.2 billion) over the next five years to help Singaporeans benefit from a new universal health insurance plan called MediShield Life to be implemented at the end of next year, according to the Ministry of Health. It has also set aside S$9 billion for health care and other benefits for the elderly as part of a Pioneer Generation Package.

Bloomberg’s ranking of the most-efficient health-care systems is based on countries with a population of at least 5 million, GDP per capita exceeding $5,000 and a minimum 70-year life expectancy. This year’s ranking took into account year-on-year changes to the criteria used.

Hong Kong’s health-care cost per capita increased 38 percent from a year earlier to $1,944, while Singapore’s rose 13 percent to $2,426, according to the ranking. Singapore’s life expectancy gained 0.4 years in the same period to 82.1 years, compared with Hong Kong’s 0.06 years rise to 83.5 years.

“The higher health expenditure is a result of the increase in both government spending as well as expenses of the private sector,” a representative for Hong Kong’s Secretary for Food and Health Ko Wing-man wrote in an e-mail. Singapore’s Ministry of Health declined to comment on the ranking.

Targeted Spending

Singapore’s consumer prices rose 1.2 percent in July from a year earlier, the slowest pace since March, while Hong Kong’s inflation quickened to 4 percent from 3.6 percent in June.

Hong Kong has higher utilization rates and public medical expenditure, while Singapore’s health-care spending is more targeted, said Phua Kai Hong, an associate professor of health policy and management at the Lee Kuan Yew School of Public Policy in Singapore, citing preliminary findings from his comparative studies.

A photograph of patients housed in a tent outside Singapore’s Changi General Hospital in the Straits Times newspaper in January prompted concern that the nation’s hospitals may not be able to accommodate the aging population.

The number of elderly in Singapore, or those older than 65 years, will triple to 900,000 by 2030, according to the National Population and Talent Division. Based on the current birth rate and without opening its workforce to more foreigners, the median age in the city-state will rise to 47 years by 2030 from 39 in 2011, it said.

Chronic Illnesses

The average length of stay in hospitals for patients aged 65 years and above rose to 8.2 days in 2013 from 7.8 days in 2010, according to the Ministry of Health. About 1,200 beds will be added to the health-care sector this year, with 10,000 more by the end of 2020, according to the ministry.

In addition to eight public hospitals, private options on the island include IHH Healthcare Bhd.’s Mount Elizabeth and Raffles Medical Group Ltd.’s center.

“As the population of older people with chronic illnesses and disabilities and home requirements increases,” beds would get filled with more people who have difficulty getting out of the hospital, said David Matchar, director of health services and systems research at Duke-NUS Graduate Medical School in Singapore. “It only means that the bed crunch would get worse.”

Singapore topped a separate 2012 Bloomberg Ranking of the world’s healthiest countries, compared with Hong Kong at 17th and the U.S. at 33rd out of 145 countries. Singapore’s Health Promotion Board hosts free exercise programs in the central business district and schools run a program to help overweight and underweight children achieve an ideal weight.

“In terms of Singapore being very high in terms of rankings, I think largely it is attributable to preventative care,” said Tilak Abeysinghe, an associate professor of economics at National University of Singapore. “The government takes a very, very active role of telling people to live healthily.”

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