• About Us
    • Fact Checking Policy
    • Ownership & funding information
    • Volunteer
  • Subscribe
  • Letter submission
    • Submissions Policy
  • Contact Us
The Online Citizen Asia
  • Opinion
    • Editorial
    • Commentaries
    • Letters
    • Comments
  • Current Affairs
    • Singapore
    • Malaysia
    • Indonesia
    • China
    • ASEAN
    • Asia
    • International
  • Finance
    • Economics
    • Labour
    • Property
    • Business
  • Community
    • Arts & Culture
    • Consumer Watch
    • NGO
    • Lifestyle
    • Travel
  • Politics
    • Civil Society
    • Parliament
    • Transport
    • Education
    • Environment
    • Health
    • Housing
  • Law & Order
    • Legislation
    • Court Cases
No Result
View All Result
  • Opinion
    • Editorial
    • Commentaries
    • Letters
    • Comments
  • Current Affairs
    • Singapore
    • Malaysia
    • Indonesia
    • China
    • ASEAN
    • Asia
    • International
  • Finance
    • Economics
    • Labour
    • Property
    • Business
  • Community
    • Arts & Culture
    • Consumer Watch
    • NGO
    • Lifestyle
    • Travel
  • Politics
    • Civil Society
    • Parliament
    • Transport
    • Education
    • Environment
    • Health
    • Housing
  • Law & Order
    • Legislation
    • Court Cases
No Result
View All Result
The Online Citizen Asia
No Result
View All Result

Focus on Healthcare – Part 2: Where did our money go?

by Terry Xu
01/10/2013
in Current Affairs
Reading Time: 5 mins read
0

Focus on Healthcare is a five-part series that provides a critical analysis of Singapore’s healthcare system, popularly known as the 3M system (MediShield, Medisave, Medifund). Through it, we hope to provide an understanding of how healthcare financing is currently being funded and used in Singapore, and explore the ways in which this can be further enhanced to cater for the needs of Singaporeans.

In this second part, we take a look at exactly how much we have in the 3M piggy bank, and how best it can be spent before we have to consider raising premiums or taxes.

 

By Roy Ngerng and Leong Sze Hian

Following his announcement during the National Day Rally 2013 to tweak the 3M system, Prime Minister Lee Hsien Loong announced that government healthcare subsidies will increase, and that the MediShield Life premiums and Medisave contribute rates will also be increased, to foot the increase in healthcare spending, because “we each have to take personal responsibility for ourselves.”

A few days later, Channel NewsAsia reported that PM Lee had “reiterated that while the government will do more, ‘good things need to be paid for’.” He also said, “If I’m discussing whether to raise taxes or not, I think I will never finish that discussion. So, one day when we have to raise taxes, the government will just have to make up its mind and say, ‘ok, I have to decide, I have to do this, I have to persuade people’, because otherwise it’s not workable.”

It was also reported in the Today newspaper that, “the government is unlikely to raise income tax to pay for the slew of healthcare, housing and infrastructure initiatives announced.” Rather, “the Goods and Services Tax (GST) might instead be the first in line for an increase should the Government need to raise revenue.”

However, as some observers have noted, Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam had said in the run-up to the general election in 2011 that the GST will not be raised “at least for five years” because, he said, “there’s absolutely no reason to raise the GST.” We are only two years into this “five years”.

But how much do Singaporeans have in their MediShield and Medisave right now? And is there a need for Singaporeans to pay more, either through additional premiums or taxes?

For Medisave, in 2012, there was a total balance of $60 billion but the amount withdrawn for direct medical expenses was only $768 million – this effectively makes up only 1.3% of the total balance.

For MediShield, Parliament had also revealed that the MediShield surplus is $850 million for the last 10 years. In 2011, only $282 million MediShield claims were made. This means that only 24.9% of the known MediShield reserves had been claimed.

Finally, for Medifund, in 2012, the capital sum is $3 billion. Of this, only $98.2 million was disbursed in 2012. This represents only 3.3% of the capital.

In graphic terms:

medisavechart2

If we take these figures as an annual average, the withdrawals from Medisave make up only 1% of the balance, MediShield only 25%, and Medifund only 3%.

Adding them all up, there would be about $64 billion in balance in the 3Ms. The total of $1 billion spent would make up only 1.8% of the total 3M balance.

The question to ask: What happened to the rest of the 98.2% – or $63 billion – of the 3M balance?

What’s more, if we look back at the Medisave balance, the amount has been steadily increasing while the amount withdrawn has been slowing down.

In 2012, there was an increase of 9.5% in the total Medisave balance, from $54.8 billion to $60 billion. However, for the amount withdrawn, it only grew by less than a tenth of it, at 0.9%, from $761 million to $768 million.

Moreover, Medisave is also invested in Singapore government bonds, which earn annualised returns of 16% in S$ terms for the last 39 years, and about 6% in US$ terms for the last 20 years, respectively.

From the statistics above, it would seem that there is no deficit in running the Medisave, MediShield and Medifund schemes. On the contrary, the government is accumulating a huge surplus of more than 98% of the 3M balance.

To be clear, since the 3M schemes have high accumulated surpluses, they don’t actually cost the government a single cent. In fact, because Singaporeans are forking up the money through taxes and Medisave, they are in effect paying for their own healthcare bills by themselves. Worse yet, they are paying a portion of their own wages into these schemes, without seeing significant real returns comparable to those obtained by the government, whilst these schemes continue to accumulate surpluses.

Watch this space for part three, where we will try to work out the sums that will continue financing our healthcare needs without incurring additional taxes or premiums. And no, we are not trying to take over the Finance Minister’s job…

For just US$7.50 a month, sign up as a subscriber on The Online Citizen Asia (and enjoy ads-free experience on our site) to support our mission to transform TOC into an alternative mainstream press.

Related Posts

WHO panel in talks on COVID emergency status
AFP

WHO panel in talks on COVID emergency status

27/01/2023
AFP

Two years after Myanmar coup, UN says situation ‘catastrophic’

27/01/2023
Grab driver supposedly earned $5,227.82 in a week prior CNY, netizens voice worries over his health
Community

Grab driver supposedly earned $5,227.82 in a week prior CNY, netizens voice worries over his health

27/01/2023
Philippines to appeal ICC resumption of drug war probe
AFP

ICC grants new inquiry into Manila’s deadly ‘war on drugs’

27/01/2023
Minister refutes claims of Malaysia consulting Singapore on housing policy due to its inefficient civil service
Housing

Minister refutes claims of Malaysia consulting Singapore on housing policy due to its inefficient civil service

27/01/2023
457 civil society organizations call on ASEAN to move beyond the Five-Point Consensus
AFP

Myanmar junta sets out tough new rules for political parties

27/01/2023
Subscribe
Connect withD
Login
I allow to create an account
When you login first time using a Social Login button, we collect your account public profile information shared by Social Login provider, based on your privacy settings. We also get your email address to automatically create an account for you in our website. Once your account is created, you'll be logged-in to this account.
DisagreeAgree
Notify of
Connect withD
I allow to create an account
When you login first time using a Social Login button, we collect your account public profile information shared by Social Login provider, based on your privacy settings. We also get your email address to automatically create an account for you in our website. Once your account is created, you'll be logged-in to this account.
DisagreeAgree
0 Comments
Inline Feedbacks
View all comments

Latest posts

WHO panel in talks on COVID emergency status

WHO panel in talks on COVID emergency status

27/01/2023

Two years after Myanmar coup, UN says situation ‘catastrophic’

27/01/2023
Grab driver supposedly earned $5,227.82 in a week prior CNY, netizens voice worries over his health

Grab driver supposedly earned $5,227.82 in a week prior CNY, netizens voice worries over his health

27/01/2023
Philippines to appeal ICC resumption of drug war probe

ICC grants new inquiry into Manila’s deadly ‘war on drugs’

27/01/2023
Minister refutes claims of Malaysia consulting Singapore on housing policy due to its inefficient civil service

Minister refutes claims of Malaysia consulting Singapore on housing policy due to its inefficient civil service

27/01/2023
457 civil society organizations call on ASEAN to move beyond the Five-Point Consensus

Myanmar junta sets out tough new rules for political parties

27/01/2023
Thai ruling party names deputy PM as main election candidate

Thai ruling party names deputy PM as main election candidate

27/01/2023
Mrs Teo says SG continues to invest in training local talent while MNCs transfer staff to work in SG

Mrs Teo says SG continues to invest in training local talent while MNCs transfer staff to work in SG

27/01/2023

Trending posts

Two Indian nationals paid about S$330 and S$730 respectively for forged certificates submitted in their S-Pass application

MOM found issuing EPs meant for foreign PMETs to PRC waitress and general worker

by Correspondent
26/01/2023
34

...

Ho Ching breaks silence over Temasek’s write down of its US$275 million investment in FTX, says it “can afford to be contrarian”

US regulator questions VCs’ due diligence work prior to investing in FTX; Ho Ching says Temasek can afford to be contrarian

by The Online Citizen
24/01/2023
28

...

Indian rupee falls 60% since signing of CECA while Singapore becomes top investor in India

by Correspondent
25/01/2023
52

...

Focus on Healthcare – Part 2: Where did our money go?

by Terry Xu
01/10/2013
0

...

Temasek and GIC reportedly in talks with Adani Group accused of “brazen” market manipulation and accounting fraud

Temasek and GIC reportedly in talks with Adani Group accused of “brazen” market manipulation and accounting fraud

by The Online Citizen
26/01/2023
46

...

“党籍不会过期失效”  前进党称已就党籍终止知会卡拉

AGC asked to explain purposes of 68 private letters of inmates illegitimately forwarded to prosecutors

by The Online Citizen
21/01/2023
16

...

October 2013
M T W T F S S
 123456
78910111213
14151617181920
21222324252627
28293031  
« Sep   Nov »
  • About Us
  • Subscribe
  • Letter submission
  • Contact Us

© 2006 - 2021 The Online Citizen

No Result
View All Result
  • Opinion
    • Editorial
    • Commentaries
    • Comments
  • Current Affairs
    • Malaysia
    • Indonesia
    • China
    • ASEAN
    • Asia
    • International
  • Finance
    • Economics
    • Labour
    • Property
    • Business
  • Community
    • Civil Society
    • Arts & Culture
    • Consumer Watch
    • NGO
  • Politics
    • Parliament
    • Transport
    • Education
    • Environment
    • Health
    • Housing
  • Law & Order
    • Legislation
    • Court Cases
  • Lifestyle
    • Travel
  • Subscribers login

© 2006 - 2021 The Online Citizen

wpDiscuz