See healthcare productivity from patient’s perspective

In Political governance on 16/03/2012 at 10:34 am

So the SDP says healthcare should be a “right not a commodity” while the WP’s Chairman (and a MP) points out, “Singapore’s total expenditure on healthcare as a % of GDP was far lower than international standards. More importantly, the government or public expenditure on healthcare is also far lower than elsewhere. Singapore’s government expenditure on healthcare is about 1.6% of GDP; nearly 4 times lower than the 6.1% global average in 2009”.

Here’s an interesting perspective from Jeremy Lim, a private sector healthcare manager, that appeared in BT sometime ago. The headlines sums up what I as a 50-something “new poor” but financially responsible voter want from a public healthcare system: not money being thrown at the system but

See healthcare productivity from patient’s perspective

Does their health improve in the shortest possible time at the lowest possible charges?

BUDGET 2012 reaffirms the government’s commitment to raising productivity and signals in no uncertain terms the stance that some short-term pain faced by companies is necessary for the longer-term good. However, even as we re-examine processes and traditional practices, it is timely also, especially in very tightly regulated sectors such as healthcare, to explore whether our rules and regulations encourage and reward productivity efforts.

In some instances, in the name of safety, do we actually stifle productivity and ‘kill’ innovation?

Funding is another key driver of behaviour – does the way we reimburse healthcare paradoxically reinforce inefficiency?

Healthcare trade-off

Healthcare is often characterised as ‘finite resources, infinite demand’. There is never enough to satisfy everyone and difficult choices balancing cost and effectiveness have to be made.

This necessitates that at the system level, clinical quality and patient safety are relative concepts.

Imagine a graph plotting ‘Cost’ on one axis and ‘Effectiveness’ on the other. The resulting 2 x 2 matrix conveniently categorises all healthcare interventions into one of four possibilities: ‘Less Expensive and More Effective’, ‘More Expensive and Less Effective’, ‘More Expensive and More Effective’, and ‘Less Expensive and Less Effective’.

The first two are easily dealt with: Do the first; it is a no-brainer, don’t do the second; another no-brainer.

If ‘More Expensive and More Effective’, then the pivotal question is ‘Is it worth the extra costs?’

For the ‘Less Expensive and Less Effective’ category, which we will focus on, the key question to ask is ‘Is it good enough?’

Over-specified standards

Singaporean readers old enough will remember the dental hygienists of yesteryear scaling and polishing teeth, especially of children. These hygienists were, compared to dentists, less well educated ‘technical staff’ and trained specifically in scaling and polishing, leaving diagnostics and more complicated dental procedures to properly qualified dentists.

As Singapore advanced up the economic ladder, the dental hygienist faded away and dentists dominated the landscape.

In recent years, the hygienist has made a comeback. With increasing recognition of the desperate shortage of dentists, dental hygienists are now resurgent. Of course a dentist should be more skilful in polishing and scaling teeth, but is a hygienist good enough?

Think about the MinuteClinic in the United States. Starting with a modest single clinic in 2000, the chain now has 600 locations across the US proudly proclaiming: ‘Our practitioners have seen more than 11 million patient visits, with a 95 per cent customer satisfaction rating’.

These practitioners are supported by sophisticated computer algorithms, treating only specific symptoms and conditions, and are priced much lower than traditional practices. Oh, retail clinics are run by nurses and physician assistants. Is that good enough?

Prescribed nurse-to-bed ratios are entrenched in healthcare regulations in many countries and a cheap and easy regulatory instrument. However, these may be an over-specification and penalise innovative organisations which embrace technologies to increase an individual nurse’s efficiency. Tele-health initiatives may permit offsite and even out-of-country monitoring, thus enabling fewer nurses to care for more patients.

But hospitals have little incentive to invest or even think about such possibilities if the ratios are rigid and allow for no cost savings from reduced manpower.

Dollars and sense

Years ago, some patients would be admitted to hospital overnight for an MRI. These otherwise well patients occupied a bed for one night so as to be eligible to use Medisave dollars to pay for the MRI! Today, while such blatant examples of ‘abuse’ are less common, Medisave, by design, is still biased towards hospitalisation payments. Choosing between a day surgery and an inpatient option for a minor surgery, say, a laparoscopic gall bladder removal, the sharp patient would note that Medisave claims for hospitalisation go up to $450 a day but only $300 for day surgery coverage.

Between two nights in a hospital with room rate claims of $900 and an outpatient procedure followed by hiring a day nurse for post-operative home care for which only a total of $300 is claimable, which would patients choose?

Are we inadvertently fostering prolonged admissions at a time when Singapore is furiously playing catch-up to the tune of 1,900 hospital beds?

Patients today resist moving from subsidised wards in public hospitals to community hospitals as the subsidy schemes are more generous in the public hospitals. Furthermore, half the patients would not qualify for government subsidies.

Finance Minister Tharman Shanmugaratnam announced in this year’s Budget that ‘all patients in community hospitals will now qualify for government subsidies . . . The middle-income group will receive the largest increase in subsidy rates, getting a subsidy of 20 to 50 per cent when they previously did not receive any’.

This is a step in the right direction to ensure a coherent financial gradient and, hopefully, will result in better use of very scarce hospital beds.

Productivity in healthcare needs to be reframed as value creation from the perspective of the patient and not simplistically as output for a given input, which is a common technical definition.

The hospital which has its doctors seeing a hundred patients a day may not be better than the hospital whose doctors treat on its premises only 30 patients a day. What matters to patients is whether their health improves in the shortest possible time with the least possible inconvenience at the lowest possible charges.

This engagement with the healthcare system may be in an institution, like a hospital, or in the home setting, offered by a doctor with over a decade of intense specialisation or a technician with two years of vocational training – it doesn’t matter.

What matters is the outcome and it is not simply a matter of productivity.

Governments have a role to play not just in doling out incentives to spur productivity and innovation, but in fostering an eco-system where smart regulations drive genuine value creation, and reversing payment perversions that result in inefficiency and wastage.

The writer is CEO, Fortis Healthcare Singapore

  1. Takes someone in the medical arena, or a long-term patient, to pin-point the crux of the issue and the fundamentals. Too bad most of the medical practitioners are too busy creating the Golden Age foe themselves and their families. You want cheap and good? Screw you and fark off.

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