This Country Spends Way Less Than USA on Healthcare and Gets Better Results

Spending less, not more, on healthcare seems to be doing the trick.

singapore

According to the Bloomberg Global Health Index that recently came out, among the 163 countries it considered, the healthiest is Italy, followed by Iceland, Switzerland and Singapore. U.S. is the 34th. And that speaks volumes.

Based on the latest available statistics, the U.S. spends 17% of its GDP on healthcare, yet millions of Americans remain uninsured and life expectancy is slightly below average for a rich country. Singapore, on the other hand, only spends about 5% of its GDP on healthcare.

With that big difference, one would think that health care conditions in the U.S. are far better off than Singapore. And yet it is the exact opposite. Which makes one wonder — what is the U.S. doing wrong? Or in a more positive light, what could Singapore be doing right? The short answer, it’s a combination of different techniques that are obviously working well together.

First, Singaporeans are forced to save and manage their spending habits. Instead of spending what they save voluntarily through health-savings accounts, they spend what they save in their mandatory health savings accounts (Medisave Programme) which also receive contributions from their employers.

Second, their catastrophic insurance doesn’t come from several competing health insurance companies. Instead, it comes from a single-entity, MediShield, which is run by the government.

Third, there’s Medifund — the government’s ‘safety net’ for patients who cannot afford to pay their own bills, which also contributes to MediSave accounts of its poorer and older citizens, as well as other supplemental programmes.

Fourth, the government is actively involved in regulating supplies and all costs related to healthcare services. It even goes as far as setting specific targets for public and private hospitals so they don’t earn excessive profits and stay competitive within reason.

Together, all these policies work to promote more responsible spending on the part of both the citizens and the government. While forcing its citizens to save and spend wisely, the government is also freeing up more funds to spend on goods other than healthcare.

In the process, Singapore has earned for itself the honor of being the 4th healthiest country in the world. And according to the World Health Organization (WHO), the Southeast Asian nation has the second lowest infant mortality rate and among the highest life expediencies from birth.

Health care is a right and not a privilege, and as such it’s the government’s responsibility to find practical and efficient ways to move toward a non-subsidy-laden health care system that ends the private insurance company domination and moves toward a European single-payer healthcare for all system type approach.

As one of the world’s superpowers, it is totally unacceptable to see how our healthcare system here in the U.S. — which besides being the most expensive and complicated in the world and seemingly designed to encourage waste — continues to remain (when in fact it shouldn’t-after all, we the taxpayers foot much of the bill when it comes to government health spending per person) a divisive and hot political issue with Republicans advocating one thing while Democrats advocate another. The irony of it all, though, is that both parties know fully well that the market under which our current system operates is not a free and fair market. Why? Because it’s designed to maximize profits for private insurance companies rather than provide quality health care for all. Yet, despite spending almost twice as much per head on healthcare as any other country, our healthcare outcomes lag behind many other nations. By the way, we are on track to spent 40% of our GDP on health care by fiscal year 2050.

We know solving this issue is not going to be easy as cost escalation and containment have to be addressed with the creativity they deserve, but at the same time ignoring the facts is at this point no longer an option. Additionally, if Singapore was able to come up with programs that work, surely we can do it too. But it has to start somewhere. We just hope that we can find that starting point soon because without it, there’s just no way we can move forward and look ahead to a better healthcare system in the future.

1 Comment on This Country Spends Way Less Than USA on Healthcare and Gets Better Results

  1. This is an opinion piece, but not labeled as such. Furthermore, it just blatantly states health care is a right: based on what? It is not in the Constitution. Also, you ignore the diversity and size of the USA versus Singapore. If we had a true free market system it would be much better than Singapore’s I can tell you that. PRIVATE co-ops for one are working well right now in the USA. Paying about $60/month per person with $750 deductible. It is good coverage too. My wife and I are in our late 50’s. There is too little competition in number of doctors, hospitals, pharmas and insurance companies. Get rid of the AMA’s control on how many doctors there can be for one. Get rid of their crazy 8-10 year requirement to be a doctor (Britain’s doctors only go to school for 4 years, in fact those doctors can practice here in the USA). Let insurance be sold across state lines. Time to cut the red tape big time in drug development (and sales channels too including let Canada import drugs if organizations want to buy from them). And you know what? Every limitation, i.e. dramatic cost increase, is traced to the govt’s policies. Get govt. out of health care, save say the bottom 10%, and the free market will work wonders. Another reason why this would work is 5% of Americans use 49% of all health care dollars. So take out 49% of all health care spending and rates would plummet for 90% of Americans.

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