The debate on private vs public healthcare is a never-ending one. When choosing a healthcare provider, you may have pondered whether you should seek treatment at a private or a public medical facility. For this purpose, one of the key considerations would be the potential healthcare cost. To reduce such out-of-pocket costs, many consumers choose to purchase a suitable health insurance plan that provides adequate coverage for the type of medical facility that they prefer. For example, if you are comfortable with staying at Class B2/C wards at a public hospital, then you may rely on MediShield Life to cover the hospital bill. To guide you towards making the right financial decisions, here are seven common factors that you can use in your evaluation.

Table of Contents:

1. Waiting Time for Admission to Ward
2. Beds Occupancy Rate
3. Potential Treatment Cost
4. Health Insurance Policy’s Annual Claim Limit
5. Pro-Ration Factor
6. Deductible, Co-Insurance, and Co-Payment
7. Health Insurance Policy’s Annual Premium
8. Private vs Public Healthcare Insurance

One Minute Summary:

• When you evaluate private vs public medical care, there are three key factors to consider; that is, 1) Cost, 2) Quality, and 3) Accessibility.
• While private medical insurance unlocks access to fast and superior medical care, its cost is a concern.
• Although you gain access to more affordable healthcare options in public hospitals, the longer waiting time is a concern.
• On the whole, you should strive towards a balance between the type of medical care that you need, and the price that you can pay.

Part 1: Waiting Time for Admission to the Ward

Firstly, the waiting time for admission to the ward measures the number of hours from the time “the decision by a doctor to admit a patient” to the time “the patient exits the Emergency and Medicine Departments (to go to the inpatient ward)”. Based on the data from the Ministry of Health Singapore, in 2023,

• Alexandra Hospital: 2.1 hours
• Changi General Hospital: 12 hours
• Khoo Teck Puat Hospital: 9.8 hours
• Ng Teng Fong General Hospital: 9.1 hours
• National University Hospital (Adults): 5.7 hours
• Singapore General Hospital: 4.6 hours
• Sengkang General Hospital: 7.6 hours
• Tan Tock Seng Hospital: 6.6 hours

Summing up, the average median wait time for admission at the Emergency Department across the eight public hospitals is 7.2 hours. To explain, Health Minister Ong Ye Kung shared that there are many more patients with more complex medical needs, often older, and also need longer hospital stays. As a result, this contributed to higher bed utilisation, thereby slowing the flow of patients from the emergency departments to the hospital wards.

Part 2: Beds Occupancy Rate

Secondly, the bed occupancy rate measures the number of beds occupied at the hospital at a given time. Based on the data from the Ministry of Health Singapore, in 2023,

• Alexandra Hopsital: 81.6%;
• Changi General Hospital: 87.4%;
• Khoo Teck Puat Hospital: 96.9%;
• Ng Teng Fong General Hospital: 93.8%;
• National University Hospital (Adults): 86%;
• Singapore General Hospital: 85.5%;
• Sengkang General Hospital 87.2%;
• Tan Tock Seng Hopsital: 95.8%.

Summing up, the daily average bed occupancy rate across the eight public hospitals is 89.2%. To put it another way, close to 9 out of 10 hospital beds are occupied daily. Emphatically, this raises a concern about whether you will be able to get a hospital bed when you need it the most. To illustrate, The Straits Times reported this incident in 2017: Patient could not get place in SGH, hit with $78k bill – The Straits Times, 11 October 2017. In summary,

• Mr Thomas Lukose suffered a heart attack while he was at work at Gleneagles Hospital.
• As a result, he was taken to the hospital’s emergency department for immediate treatment.
• Following that, his family wanted to transfer Mr Thomas to the National Heart Centre Singapore. This is because his insurance covers him for subsidised care only.
• However, the National Heart Centre Singapore did not have any spare beds in its intensive care unit at that time. Consequently, Mr Thomas could not be transferred immediately.
• Two days later, National Heart Centre Singapore offered a bed to Mr Thomas. Despite that, his condition made it risky for the transfer to take place.
• Under those circumstances, the cardiothoracic surgeon from Gleneagles Hospital had to operate on Mr Thomas promptly.
• In sum, the hospital billed $78,000 to Mr Thomas for his medical treatment.

On the other hand, we are assuming that if you choose to go to a private hospital, then there will be a shorter waiting time for admission to the ward. Similarly, the bed occupancy rate in a private hospital should be lower as well. To cross-check this assumption, in 2022, the MP for Aljunied GRC, Ms Sylvia Lim asked the Minister for Health about the then occupancy rates of private vs public hospitals. In response, for public hospitals, the overall average monthly bed occupancy rate is 88.5%. In contrast, for private hospitals, the overall average monthly bed occupancy rate is 47%. This response and statistics justified our assumption that there is lower bed occupancy in private hospitals.

Part 3: Potential Treatment Cost

There is a noticeable difference between the treatment cost in private vs public hospitals in Singapore. To list, this may be due to varying ward charges, operation fees, doctor’s attendance and consultation fees. To illustrate this, let’s look at the bill range and the median bill for the most common form of heart surgery in Singapore, bypass operations (Code: SD742H).

Based on the table above, here are some of the observations that we can make from the Bill Range and Median Bill:

1. In public hospitals, under the subsidised category (i.e. Class B2/C ward), 75% of the patients were charged a total bill of less than $12,401.
2. In public hospitals, under the non-subsidised category (i.e. Class A ward), 75% of the patients were charged a total bill of less than $43,159.
3. In private hospitals (which are also non-subsidised), 75% of the patients were charged a total bill of less than $99,810.
4. As can be seen, treatment in private hospitals costs 8 times more than treatment in public hospitals (under the subsidised category).
5. Similarly, treatment in private hospitals costs more than double the treatment in public hospitals (under the non-subsidised category).

Therefore, we can conclude that if you seek treatment in private hospitals, then you should expect to pay a larger medical bill.

Part 4: Health Insurance Policy’s Annual Claim Limit

To explain, the annual claim limit is the maximum total amount of all the reimbursements that the insurer shall make for the incurred eligible expenses. If the treatment cost is above the annual claim limit, then the insurer shall not be liable to cover the medical expenses. Accordingly, this means you will need to bear the remaining cost on your own. At this time, based on the Comparison of Integrated Shield Plans by the Ministry of Health Singapore, this is the annual claim limit for the various types of integrated shield plans across the seven insurers:

• Standard Integrated Shield Plan (For Public Hospital Class B1 Coverage): $200,000
• Class B1 in Public Hospitals: Between $120,000 to $500,000
• Class A in Public Hospitals: Between $150,000 to $1,000,000
• Private Hospitals: Between $250,000 to $2,500,000

It is worth noting that different insurers may set different annual claim limits. With this in mind, I will encourage you to conduct further research on the plan that you are interested in. Summing up, we can see that the higher the entitled level of health insurance coverage, the higher the policy’s annual claim limit. To point out, this is to ensure that these plans provide sufficient payout to cover the potential treatment cost. This is similar to what I have noted earlier in the earlier section, Part 3 – where a bypass operation in a private hospital costs eight times more than the same operation in a public hospital. Such higher treatment costs mean that you will likely need a higher policy annual claim limit.

Notwithstanding that, this does not imply that a subsidised treatment will not exceed the policy’s annual claim limit. This is especially true if you make multiple medical claims in a policy year.

Part 5: Pro-Ration Factor

When you seek treatment at a medical facility that is above your plan’s level of coverage, the insurer will apply a pro-ration factor to the medical bill. For instance, MediShield Life imposes a 25% pro-ration factor when you seek treatment at a private hospital. To clarify, this means MediShield Life will only take into account 25% of the entire medical bill for its claim computation. In like manner, based on the Comparison of Integrated Shield Plans by the Ministry of Health Singapore, this is the pro-ration factor for the respective integrated shield plans (when you seek treatment at private hospitals):

• Standard Integrated Shield Plan (For Public Hospital Class B1 Coverage): 65%
• Class B1 in Public Hospitals: Between 35% to 80%
• Class A in Public Hospitals: Between 50% to 70%
• Private Hospitals: Not applicable

In general, the higher the entitled level of health insurance coverage, the higher the pro-ration factor. To clarify, this means the integrated shield plan will take a higher percentage of the medical bill into account for its claim computation.

Part 6: Deductible, Co-Insurance, and Co-Payment

As I have noted in the post, Should I buy Rider for Integrated Shield Plan, your out-of-pocket expenses depend on whether you have the integrated shield plan rider (“IP Rider”). In essence, if you do not have the IP Rider, then you will need to pay for the deductible and co-insurance component of the medical bill. On the other hand, if you have the IP Rider, then you will pay for the co-payment component of the medical bill instead. Here is a summary of the different claim computations:

In both cases (i.e. with or without the IP Rider), you will need to pay for at least 5% of the medical bill. By and large, the larger the medical bill, the larger the amount that you need to fork out from your pocket. In addition, based on our observation of the potential treatment cost (in Part 3), the medical bill tends to be more expensive in private hospitals. As a result, there is a possibility that you will incur a higher out-of-pocket cost (as compared to the case in public hospitals).

Part 7: Health Insurance Policy’s Annual Premium

All things considered, you will need to pay an insurance premium for your health insurance plan. Generally, the higher the entitled level of coverage, the more expensive the annual premium. Furthermore, the insurance premium tends to increase according to your age band. For this purpose, here are two blog posts that I have written to highlight the cost associated with an integrated shield plan:

• Lifetime Cost for Private Health Insurance Singapore
• Total Cost for Public Health Insurance Singapore

Summing up, from age 0 to 100, you may expect to pay more than double the insurance premium for a health insurance policy that covers private hospitals (as compared to Class A wards in public hospitals).

Part 8: Private vs Public Healthcare Insurance

All things considered, I will evaluate private vs public healthcare insurance based on three key factors:

1. Cost (Cheap, or Expensive);
2. Quality (Average, or Better);
3. Accessibility (Fast, or Slow).

For instance, if you want healthcare to be fast and good, then it won’t be cheap. In like manner, if you want healthcare to be cheap and good, then it won’t be fast. Given that tradeoff, which are the two factors that matter to you the most?

First Published: 8 May 2019
Last Updated: 24 August 2024