Tackling Singapore's rising healthcare costs - Aviva Singapore

| 15 Jun 2020

Maintaining Singapore's healthcare costs comes down to collective responsibility and access to health information, according to Daniel Lum, Product & Marketing Director, Aviva Singapore. He shares his insights in this article.

The cost of healthcare in Singapore has always been a hot topic - and now, as people’s health and safety leads the headlines every day, it has become even more prominent.

It is a complex topic, with many different variables and factors influencing it, but it’s time to shine a light on where the responsibility lies around healthcare costs, and also how Singaporeans feel the healthcare sector is servicing them and what every healthcare stakeholder can do to keep improving this.


Singapore’s rising healthcare costs

Firstly, the facts: according to a recent Mercer study, medical cost inflation in Singapore rose 10% in 2018 - and it’s expected to continue rising in the coming years.

Another study by Willis Towers Watson found that the leading cause of inflation in the healthcare sector is over-servicing by medical professionals. This alone could be its own article, but with regards to these studies - finding the right balance in the cost of care is not simple, and it’s a hard line to follow for any insurer.


Everyone has a key role to play 

Taming this situation requires the effort of all parties including medical professionals, insurers, financial adviser representatives, and policyholders. Only then can healthcare remain affordable and sustainable.

If you ask Singaporeans whose responsibility it is to help curb healthcare costs, what do you think the answer would be? Thankfully, we did ask them, so there’s no guesswork here.

While 63% of Singaporeans believe this responsibility lies with the government, 17% say it falls on the shoulders of medical providers, and 8% on insurers.

Just 12% said they believed that “individual responsibility” should play a part - that is, each individual person making choices regarding their own healthcare that:

a) finds a feasible and affordable solution for their concerns, and
b) does it in a way that doesn’t ‘inflate’ the healthcare sector further via over-servicing or otherwise. 

These responses were part of our Aviva Health Survey 2020, and these results bring to light an important factor of this entire discussion: the need for healthcare information and education.

In order to take more individual responsibility in helping to curb healthcare costs, Singaporeans say they need more information from all parties when making decisions regarding their healthcare.

Source: Aviva Singapore

Our survey backed this up, with 83% of respondents across all ages and demographics stating they would like more detailed explanations and a better understanding of the necessity of treatments prescribed by medical professionals.

This means that most Singaporeans believe having a clearer picture on a diagnosis or prescribed treatments or medications will enhance their overall healthcare experience by giving them the power to weigh up options. In fact, 77% of respondents often feel information is lacking when it comes to treatment plans prescribed by doctors.

It is important that Singaporeans are able to take the initiative to ask questions and clarify doubts they may have.


Stay updated with your healthcare benefits

Encouraging Singaporeans to play a more active role helps address the disparity in knowledge on healthcare benefits they are entitled to, which actually forms part of the solution to rising costs.

For instance, nearly half (46%) of the respondents to our survey said they were unaware that their Integrated Shield Plan has a panel of medical specialists they can use to enjoy preferred outpatient consultation fees.

Source: Aviva Singapore

Beyond this, we also know that healthcare costs are exacerbated partly by complex administrative procedures.

In Singapore, adoption levels of pre-authorisation and the approved network of panel specialists are too low. And yet, use of pre-authorisation can curb over-servicing by flagging out claims with unclear charges and treatments.

These two processes help avoid treatments that may not benefit consumers, reduce the incidence of unnecessary charges, and alleviate overall healthcare costs and ensure quality care for customers.

Read also: AIA Singapore: Medical claims pre-authorisation process as easy as 1, 2, 3


Financial adviser representatives are strong advocates for clients

It’s a complex issue with not one simple answer - but there are other key things that can speed up this necessary process of driving more healthcare awareness and education.

"Financial Adviser Representatives (FARs) play an important part in this ecosystem."

Sharing a direct relationship with clients puts them in the ideal position to advise on matters concerning the use of health insurance processes like customer care hotline for appointment/hospitalisation, panel specialists and pre-authorisation.

As an insurer, we want to help them build a strong adviser-client relationship so that communication is effective, and clients are directed onto the right customer journey to get quality care.

It is also imperative that advisers are properly aligned with the big picture of lowering healthcare premiums. This includes two-way conversations that allow new health related initiatives and processes to be shared efficiently and more importantly, validated by feedback and sentiments from the ground through the FARs.

All in all, we must bear in mind that each of us – not just government authorities and healthcare institutions – have a part to play in ensuring healthcare cost sustainability.

No amount of effort is insignificant and we can first start by closing these education gaps when it comes to our healthcare decisions.


Daniel Lum, Product and Marketing Director, Aviva Singapore

Daniel is responsible for product development for Individual Life & Health solutions, brand and marketing, the analytics function, as well as distributor training. He has over 25 years of experience in financial services.


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